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12/08/2009 05:59 PM
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The Financial Meltdown: Absolutely Nothing Has Been Fixed 15 comments
by: Charles Smith December 07, 2009 |

Let's start with The Obvious: None of the fundamental causes of the global financial meltdown have been fixed in 2009.

As we careen toward 2010, it's a good time to return to basics, starting with this question: have any of the causes of the global financial meltdown been fixed? No.

Rather than address the actual causes, which would have required various financial Elites to absorb staggering, crushing losses and a re-ordering of political swag, The Powers That Be opted to mask the systemic rot with massive, unprecedented giveaways of public taxpayer funds to various banking cartels and other financial Elites.

The political and financial Elites augmented this stupendous transfer of public monies to private hands with simulacrum "reforms" which do nothing to inhibit systemic looting, fraud, debauchery of credit and pillaging of the public coffers.

Lastly, these same Powers That Be orchestrated (with the collusion of the handful of corporations which own/control the vast majority of the world media) a vast, pervasive propaganda campaign to persuade the distracted, worried populace that the great ship of the global economy (2/3 of it owned by the top 1%) had been righted by government easing of money and credit and other interventions.

Bogus government statistics form the rotten core of this propaganda campaign. Thus, the GDP supposedly rises even as the only accurate measures of economic activity--sales and income tax receipts--continue declining. While the government touts a drop of "only" 11,000 in November payrolls, private calculations arrive at a much different conclusion: 255,000 jobs were lost.

Given that almost 300,000 people supposedly "left the labor force" (meaning they ran out of unemployment and thus dropped off the count) and the Bureau of Labor Statistics ginned up tens of thousands of phantom jobs via their laughable "birth-death model," then we might conclude that 255,000 jobs lost is a dramatic undercount of the actual reality.

Beneath the propaganda swirling around "healthcare reform," a.k.a. sickcare getting sicker, lies the ugly, purposefully ignored truth: the thousands of pages of this "package" are larded and laced with giveaways to influential cartels which profit from the expansion of the sickcare system (public and private).

For example, California Representative Eshoo slipped in a multi-billion dollar giveaway to a handful (i.e. a cartel) of California-based biotechs: Eshoo bill huge boon for Silicon Valley biotech:

Buried in the giant health care bills in Congress is a multibillion-dollar bonanza for Silicon Valley's biotechnology and venture capital industries, sponsored by Rep. Anna Eshoo, a Palo Alto Democrat.

The provision would grant "biologic" drugs, a new class of drugs based on gene splicing and grown in living cells, 12 years of protection from competition by the generic drug industry, in addition to their patents.

A scathing report by the Federal Trade Commission in June said no added protection, much less 12 years, was warranted, and warned that the Eshoo legislation would ensure sky-high drug prices and stifle innovation on the most promising frontier of medical research.

Does anyone think this is the only "gift" to politically powerful interests in the thousands pages of legislation? The truth is this bill has virtually nothing to do with improving the health of the citizenry and everything to do with arranging the transfer of hundreds of billions of dollars in additional "healthcare" spending to a few cartels and Elites which dominate the sickcare "industries."

Virtually nothing in the hundreds of pages of legislation limits the systemic costs built into the sickcare system, and hence it fixes nothing.

Healthcare expenses, currently 16% of GDP, are rising at about 6-7% a year, regardless of which corrupt party is in power. The underlying economy is actually shrinking, regardless of the GDP propaganda being touted, but let's be generous and assume the crippled U.S. economy can actually "grow" 1% a year (and that's by borrowing and blowing trillions of dollars, of course).

If you project these trends, in 15 years the U.S. economy grows by $1.5 trillion but healthcare costs more than double from $2 trillion to over $4.2 trillion--roughly 30% of the entire GDP. And these are "best-case scenario" trends. If the economy devolves as I expect, GDP will be declining in real terms even as healthcare continues its inexorable expansion.

Does anyone think a nation which is adding trillions of dollars in new debt to its books and hundreds of billions to future interest payments, a nation which is pursuing an immensely costly strategy of global empire, a nation with $60 to $80 trillion (yes, trillion) in unfunded entitlement liabilities going forward, can possibly devote 30% of its total GDP to a healthcare system which has utterly failed to improve the overall health of the citizenry taken as a whole?

By all means, grab the public spotlight to scream and yell about the public option, or this or that issue; all that sound and fury is meaningless because the entire sickcare system, including Medicare and Medicaid, is doomed to insolvency within a few short years. If we don't accept an integrated understanding of health, much less healthcare, and the profound, systemic dysfunction of the current Kafkaesque system, then claiming that an expansion of the currently bankrupt system will improve health is truly insane.

As insane as claiming the U.S. banking system is now "fixed" because trillions of dollars have been squandered propping up the fraud and hiding off-balance sheet liabilities.

As insane as the government guaranteeing/owning 99% of the U.S. mortgage industry and buying $1 trillion toxic mortgage assets and then claiming the housing market, which is completely dependent on the government propping up irresponsible lending at absurdly low rates of interest, is "healed."

Absolutely nothing has been fixed in the past year. Band-aids have been positioned over fatal wounds, and the patient has been declared "healed." The wars of Empire are being expanded, a corrupt-to-the-core banking cartel thrives anew on government bailouts and interventions, a bankrupt, failed sickcare system is being expanded--these are not fixes, these are charades to maintain the current power structures and players being presented as simulacrum "solutions."

Just as a guess, the charade will start shredding at the seams after December 18, 2009, and gather speed after January 1, 2010.

You cover up the rot rather than fix the causes, then guess what: the rot only burrows deeper

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12/08/2009 06:20 PM
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