Macroeconomics and Miseducation

The following is an excerpt from the book Confessions of an Economic Hit Man. We found a very good section which we thought would be interesting for others to read.

“I also realized that my college professors had not understood the true nature of macroeconomics: that in many cases helping an economy grow only makes those few people who sit at the top of the pyramid even richer, while it does nothing for those at the bottom except to push them even lower. Indeed promoting capitalism often results in a system that resembles medieval feudal societies. If any of my professors knew this, they had not admitted it – probably because big corporations, and the men who run them fund colleges. Exposing the truth woudl undoubtedly cost those professors their jobs – just as such revelations could cost me mine”

This to us really gets to the heart of how much truth is taught and accepted in society. Much of our education system is designed to manipulate people into doing things that improve the condition of the people above them, and have little to do with what is true.

Our Doctrinal System

Lets start this post by defining “doctrinal.”

Oxford English Dictionary

doctrinal |ˈdäktrənl|
adjective
concerned with a doctrine or doctrines : doctrinal disputes.

doctrine |ˈdäktrin|
noun
a belief or set of beliefs held and taught by a church, political party, or other group : the doctrine of predestination.
• a stated principle of government policy, mainly in foreign or military affairs : the Monroe Doctrine.

More generally, a doctrine is a belief taught by a power structure, someone or something with the power to enforce beliefs. While a parent is not considered a power structure, such as the World Bank, for a child, their parent has a high degree of control over them in terms of their economics and in terms of the trust that children have for their parents, so the parent has the ability to enforce a doctrine or belief system on the child.

We use the term doctrinal to describe the repetition of inflexible or even false beliefs on the part of individuals. People who repeat doctrine in an unthinking manner are considered “indoctrinated”

One very good example of doctrinal behavior is found in this video below. In it Jim Rogers describes what he thinks are the correct actions to take given a financial crisis. He is shown being interviewed by a number of network interviewers who are asking him questions which have a number false premises. The interviewees have both a limited ability to work with the concepts that Jim Rogers is discussing and thus their questions tend towards the doctrinal. However, there is a second reason for this inflexibility, which is happening behind  the scenes. The interviewers appear to be being fed questions from their network editors. The like of questioning appears to support the notion that the network is in favor of a particular course of action…in this case using taxpayer money to bailout financial institutions.

Thinking for oneself is an often praised attribute. However, what is not discussed is how small a market there is for it and how people who think for themselves are often at odds with their employers and with their social support structure. The education system is doctrinal. While it well understood that education up to the high school level is doctrinal, many presume that as education level goes up, that more critical thinking takes place. This is a misunderstanding. The education system is doctrinal even to the PhD level. PhD dissertations must be approved by committiees, and very few people will obtain a PhD unless their committiees agree with both the quality as well as the doctrine and conclusions of the dissertation. One can be sure that dissertations which do not serve the interest of the committee members, or contradict the previous work of the committeee members will be tolerated. After years of effort, people generally want to get their PhDs, so its a small matter to make the necessary changes. However, it rarely comes to that as the PhD candidate will typically figure out long before this time what conclusions are necessary to garner approval from the committee and will adjust their research accordingly. One may think that after a PhD is conferred that the person is then free to express their own view. However, this is not true as that PhD’s career success will depend upon publishing articles in specific periodicals. These periodicals have particular standards, and particular doctrinal tests. Furthermore, endowments and contributions from corporate interests provide incentives for the university power structure, decentralized to departments, to promote research consistent with corporate doctrines.

Why So Indoctrinated?

The main reason that people are so indoctrinated is that there is a tremendous amount of effort spent in indoctrinating them, and that their perceived incentives are to continue to be indoctrinated. As most people work for other people, they do not have the luxury of “going their own way,” they must conform to the doctrine of their superiors. While they could live a dual life (stating they believe in public, while holding different views in public), in all frankness, most people have little concern with what is true and false and would prefer to be contented and successful over developing their mind. In a world of trade-offs, the desire for a nice house and comfortable life as well as enhanced access to desirable mating partners tends to trump the desire to investigate underlying assumptions. This is evidenced by the emphasis given to material acquisition vs. the acquisition of knowledge in most societies.

When Doctrine Does Not Work

Accepting the programming is often functional for the individual and makes them appealing to employers. however it is not always functional. We have seen how the doctrine of finance and economics has really worked against many people. The doctrine of investing in the stock market and in expensive housing has been very economically damaging to individuals while very profitable for concentrated financial power.

Political Setup of Congress

There is a serious problem with how congress makes political decisions and how many resources it consumes. First of all here are a few numbers.

1. 100 senators and 435 in the house of representatives
2. 30,000 congressional staff
3. 35,000 lobbyists (which attempt to influence the congress)
4. $2.4 billion spent in lobbying activity and campaign contributions

Furthermore, many of these congressmen have no power and are controlled by a few congressmen at the top. Furthermore, since these congressmen are placed in office by concentrated power, its debatable how much any of these congressmen is executing free will. The top congressmen chair and are on the powerful committees, however they often have no previous experience in the subjects that they cover.

Many Better Ways

There are several things that could be changed which would make the legislative process logical and would allow it serve the public interest.

1. Have 50 congressmen and have them elected nationally, that is every person in the US votes for an elects all 50 congressmen. (this way they will not support parochial interests, but could look for the broader public interest)
2. Have 10 major areas of legislation segmented (eg. defense and national security, agriculture, energy policy, education, health, infrastructure, etc), and have each area managed by 5 congressmen. The congressmen can be run and be elected based upon their experience in these areas, so experts can be selected for each committee
3. Make congressional elections 100% government supported, so that there is no money involved
4. Pay each congressman $250,000 a year for their service, and then an extra $250,000 for each year for the next 5 years after their term, and bar them from work after their tenure. This will prevent the congressmen from being bought by moving into industry after their government work.
5. Limit each congressman to 20 aides. There is no reason for a staff of more than 25 for each of these congressmen. This would bring the total congressional employment down to 1000. That would be a dramatic cut from 30,000. With no one to give money to, the lobbying industry would greatly shrink as well.

References

http://www.opensecrets.org/lobby/index.php

http://www.washingtonpost.com/wp-dyn/content/article/2005/06/21/AR2005062101632.html

Prediction and How To Adjust One’s Life

As we face the end of 2008, there is an approaching doom that is hard to miss. Here are a number of the reasons to be pessimistic about the future.

1. Environmental damage and global warming continues unabatted
2. The US consumption based model is being copied around the globe
3. The US political structure is becoming increasingly corrupt and incapable of change (exactly as Thomas Jefferson predicted)
4. The US financial system is becoming increasingly unstable with a major financial crisis every 7 years.
5. The US population is dumbing down and easily controlled by the media system
6. New immigration is bringing in extremely combative and selfish cultures and cultures that don’t have conceptions of birth control or resource management
7. World population is out of control

All of these issues are in plain view and extremely little is being done about them. This is because it would require sacrifice or novel ways of investing our resources. Both of these options are offensive to our simpleminded sensibilities. Even the mention that there are not unlimited resources and that we may have to sacrifice cause many people to fall into a rage. Our ability to leverage scientific and industrial discoveries is now completely outstripping our ability to know when to use them judiciously. This means we can no longer effectively moderate the damage we cause with our economic and industrial activities. Now that the environmental damage to the planet is generally accepted (it only took 50 years, as global warming was known as far back as 1958), we are still is not resulting in meaningful changes. An ignorant population is easily distracted by non-solutions to the problem like hydrogen. Industry has very little incentive to look at the long term as they compensate their executives in 3 month increments. Even the “educated” population in the US thinks science will come up with answers to our problems and we don’t need to make adjustments.

We have the greatest respect for organizations like Greenpeace, however they are losing the battle.

These combine factors spell doom for the civilized system that many thought we had developed in the Western Democracies. Furthermore, the planet is close to reaching a point where global warming will become self sustaining. The science of it is explained here.

http://www.pbs.org/wgbh/pages/frontline/heat/etc/worldco2.html

Personal Adjustments

It is a virtual certainty that we are going into a very difficult time, economically and environmentally. Increased greed and consumerism in the US and globally, in addition to compliant media systems make it impossible to stop this steady march. Too much effort has been spent on proposing how things can change, without a sober analysis of what the actual probabilities of change are. We propose the probabilities for change are small and our evidence is that there have not been changes to these negative tends since they began. For instance, environmental regulation passed in the 1970s in the US was not a change of course. It may have slowed the decline, but every year, though every supposed adjustment, the ice caps continued to melt, the fisheries continued to decline and global temperatures continued to rise. There is simply very little cultural progress. Every one of the lessons of Vietnam had to be relearned in Iraq. So we have a population that is amnesia tic not up the task of demanding change and in fact they may be as short sighted as their institutions. There has been meeting after meeting on these topics, innumerable treaties signed, UN conferences attended and funds raised, all with little effect on the degenerative march. Part of being an adult is admitting when things have reached a hopeless state, and taking the appropriate measures.

Here are some personal adjustments that can help protect thinking people.

1. Either do not have kids, or have only one. The future will be marked by fewer opportunities, more wars over shrinking resources and more cheating and fraud. Intelligent people don’t want their children to live in this environment. Furthermore, even if intelligent people have children, people with no standards and from disadvantaged cultures and genetics are reproducing like bunny rabbits. They are primitive, and they want a Mercedes. They have read Donald Trump’s book on success and they will do what it takes to be a winner. You can not compete with them, these craven dummies are set to inherit this diminished planet. Ignorant and self centered people are the dominant human form in any case.
2. Stockpile cash. More frequent financial crisis means the need for more financial protection. Don’t let the investment industry steal your money, as money is one of the few things that will protect you in the tooth and nail environment we are going into. Every prospectus you read, every company story you see in business magazines, every investment commercial is really about your money going into someone else’s pocket. That is the actual intent and outcome once you move past the images, fancy degrees, complex numbers and the soaring rhetoric.
3. Don’t get involved in binding contracts like marriages or credit card agreements. Cheating is at an all time high and the concentration of power gives the advantage to business over individuals. Individuals can protect themselves by minimizing their exposure to contracts.
4. Maintain your health. The US health care system has gone down the toilet and probably is not coming back. The best health insurance (which often does not pay out in any case) is a healthy lifestyle and exercise and diet. If you get sick, the medical industry, which is self perpetuating, will want to fill you with expensive treatments and pharmaceuticals of questionable value. 
5. Be extremely careful what media you ingest. If it comes to you, its is most probably subservient to corporate interests. Taking its advice will lead to bad decision for you, financially, emotionally and intellectually. Large media interests presume you to be a fool, passively waiting to understand the world through their analysis and to be told what beer to buy and what values to hold. 

Global Warming References

“Recent decades have seen record-high average global surface temperatures. Thermometer readings sufficient to provide reliable global averages are available back to 1850 (Brohan et al. 2006). In the past century, global surface temperature increased by about 1.4 °F (Fig. 1). In the past quarter-century, according to satellite measurements, the lower atmosphere warmed by 0.22- 0.34 °F per decade, equivalent to 2-3 °F per century (Christy and Spencer 2005; Mears and Wentz 2005).” – http://www.pewclimate.org/docUploads/global-warming-science-brief-august08.pdf

It’s also important to note that even though the full impact of that gradual melting won’t be for 500 years or so, we are reaching a point where we can’t turn back. The system is slow to change, but the change is somewhat unstoppable once it gets going. Unless we quickly reduce the present rate of carbon dioxide increase and subsequent temperature rise, we will be committing ourselves and our planet to that melting, and to the rise in sea level that will follow. – http://nsidc.org/news/press/20060706_goremoviefaq.html

http://news.nationalgeographic.com/news/2000/07/0715_040715_oceancarbon.html

Chomsky on Propaganda

FBI and Acorn

During the McCain and Obama Presidential contest, ACORN was first accused by Republicans of voter fraud and then the FBI was said to be investigating the organization and raided its offices.

What is ACORN?

In order to understand this case its important to understand what ACORN is and what they do. They have a host of low and moderate income issues they support. However, with regards to elections, they perform voter registration for groups that are typically disenfranchised from the political system. That is they pay people to register other people who ordinarily would not be part of the electoral system.

According to Wikipedia:

“Where ACORN has discovered that its workers submitted potentially false voter registration forms, it has followed legal requirements to submit the forms to voter registrars, flagged as requiring additional attention. San Diego County, California officials stated that ACORN-submitted registrations had a rejection rate of 17 percent for all errors in 2008, whether innocent or intentional, compared to less than five percent for voter drives by other organizations.^[19]” – Wikipedia

This is what the controversy was about. That a higher percentage of their registrations were rejected, that is they were not valid. Some of these rejections were due to fictitious names. For instance, Mickey Mouse was registered to vote in some county. First its important to understand that this is not voter fraud, this is registration fraud. However, registration fraud is a very bad way to try and influence an election. The registration is cross checked with other pieces of personal data and is rather easily eliminated from the voter role. Secondly, registering people that do not exist might be good for a person being paid to collect registrations, but it does not do anything to affect the election, because that fictitious person never appears to vote, even if the registration cross check does not work properly. So, if ACORN were fraudulently attempting to influence the election, registering people that do not exist is a strange way to do it.

The FBI Comes In

Now we come to the FBI’s involvement. As you should be able to tell from the paragraph above, there was no voter fraud charged against ACORN, only registration fraud, which ACORN would never have benefited from, and which was mostly likely done by people who worked for ACORN that were attempting to get their “numbers” up. These faulty registrations were already eliminated by a computerized matching system. So the question arises, why did the FBI decide to peruse this case? There are elections boards that could investigate (although there would be little reason to bother). So why the interest from the FBI, which does not specialize in voter fraud investigations? The answer most likely lies in political patronage. Having the FBI investigate ACORN might have helped McCain in his bid for the presidency. Bush, who holds the reigns of the Department of Justice, which holds the reigns of the FBI wants McCain to win to obvious reasons. (and less obvious, as an Obama presidency is more likely to uncover the massive amount of illegal activtiy which took place under Bush).

The FBI’s Great Concern for Voting Integrity

What is most interesting is that there were documented irregularities in the 2000 Presidential election in Florida and in the 2004 election in Ohio, yet the FBI did not see fit to investigate. Tens of thousands of voters were removed from the roles by ChoicePoint (http://www.choicepoint.com/), voting machines gave Gore negative votes, the list goes on and on, yet the FBI never did any investigating. As the movie Hacking Democracy (http://www.hackingdemocracy.com/) shows, DieBold (http://www.diebold.com/default.htm) is continuing to make and sell a voting machine that can be hacked in 10 seconds, which has a program on memory cards and which uses a database with no logging system (MS Access) as the system of record for the voting database. Yet, the FBI does not investigate. Perhaps on the Diebold voting machine issue, the head of DieBold’s promise to deliver Florida for Bush in 2004 may have had something to do with the FBI’s lack of interest. These are “real” instances of voter fraud and voter suppression, not some easily correctable and non-issue like the ACORN affair. This brings up the question of how the FBI chooses its cases. As the Elliot Spitzer investigation and the ACORN investigation point towards, the FBI is about investigating things that give the current administration a leg up on the competition. Illegality is an almost incidental concern at the FBI, political patronage and scratching the back of concentrated power their first priority. Hollywood might want to consider this when the make their next FBI movie that shows the Bureau doing things that help protect the general public.

What is Illegal?

Much has been made of the association of Obama with Bill Ayers. Bill Ayers was part of the Weather Underground, which was a lightweight terrorist organization back during the Vietnam war. We rightly call them lightweight because they called ahead of time to evacuate the buildings they set bombs in, and were more about raising awareness through extreme methods rather than killing. They were of greatest threat to themselves as a bomb creation mishap did kill several of the members of the Weather Underground. A detailed account of them can be seen at Wikipedia.

http://en.wikipedia.org/wiki/Weatherman_(organization)

However, what is not discussed is what Ayers and the Weather Underground was protesting. They were protesting the Vietnam War. During the Vietnam War the US illegally bombed at least three countries (Vietnam, Laos, Cambodia), generally accepted estimates are that this lead to the death of 3.5 million people, the dissolution of civil society in Cambodia allowing the Khmer Rouge to come to power and other negative outcomes that have left these countries in an extremely bad state. This bad state extends to the present day, and will extend to the future. A huge amount of unexploded bombs has made amputees of many in the areas that were bombed. The invasion of Vietnam was illegal, as were the bombings of Laos and Cambodia. Strange it is that Bill Ayers, who killed no one, but was responsible for property damage is considered a terrorist by conservatives, yet one of the main architects of Vietnam and a person directly responsible for taking the bombing to Laos and Cambodia is considered a lauded specialist in international relations. That would be Henry Kissinger. This brings up the question of what really is illegal. Is something illegal if it is done by a powerful country against a weaker country? What Bill Ayers did could certainly be considered justified as a way of increasing the costs of the Vietnam War to America. What else were his options? In an only slightly democratic society (notice how long a majority of the population opposed the war and how long it continued) like the US, there is little but violent action that will change its course. This is the root of terrorism of the weak against the strong, an inability to change policy through rational and peaceful means. As much as large power centers complain about terrorism, they are really referring to the very minor terror of citizens against them The US had no excuse of self protection against the Vietnamese. There was no Soviet threat, and Vietnam posed zero risk to the US. There Vietnamese were not coming to invade Peoria. This was a colonial war prosecuted after the power vaccum left when the French, who had their own illegal Vietnam War with 40,000 casualties withdrew from the area. Furthermore there was no South Vietnam and elections in Vietnam were on course until the Kennedy Administration manipulated by the CIA decided to assasinate Diem.

http://en.wikipedia.org/wiki/Arrest_and_assassination_of_Ngo_Dinh_Diem

The entire basis for the war, that the US was protecting South Vietnamese independence was pure fiction. (See below for support for these contentions. Its long, but worth it. If you respond to this post without watching this in its entirety, you won’t have a good basis for a response and I will delete the reply.)

US education and media has done its job, so not only do most Americans not know these facts, they can not interpret them properly when they are explained in even the most serene environment with all the facts place on the table. But their lack of acceptance does not change the illegality of the war. An objective view would certainly say that a war which killed 3.5 million people, which was not in any way defensive (in addition to other massive societal damage which is difficult to measure) is far more of a terrorist action. In fact it was infinitely more of a terrorist action than the Weather Underground’s activities. Kissinger, Nixon, Kennedy Johnson and the 1000s of Americans, both military and civilian, responsible for the hell on earth that was brought down upon the people of SouthEast Asia, and that continues to deeply hamper their development are the terrorists par excellance. Bill Ayers can’t be uttered in the same breath as them.

http://www.worldfreeinternet.net/news/nws125.htm

New Rules

In order to engage in an undertaking, it should conform to the following criteria. This criteria can be used to prevent a person from being sold an idea or being manipulated into a course of action that is unrealistic.

1. Portability – The endeavor should have value presently and in the present location and in the future at a future location. For instance, an RV is portable in that it can be moved and also collapsed (put into storage). Portability is important because circumstances change and portability ensures that the investment can be recouped and transferred to the new location and environment.
2. Buffering – Does the endeavor affect the individual overly strongly, does it attempt to influence in a disproportionate way or take away the individual’s autonomy? When a company hires a person they give them an email and a cell phone number, which they take once the individual leave, in essence shutting down that identity. This is not a buffered solution, but a rigged system.
3. Maintenance of Identity – Is the individual’s identity taken by the other individual, or especially by the institution. The majority of identity theft is by institutions on individuals, not individuals on other individuals.
4. Low in Maintenance – Does the item maintain itself, or require minimal maintenance? Every item takes more maintenance than is necessary. High maintenance items do not scale and have a high potential to be abandoned, erasing the investment. A perfect example here is the stock market. Invest in the stock market sounds easy enough, but constantly monitoring the stock market is a serious drain of time and you can not be sure of being able to follow it when it requires your attention most.

http://counterecon.wordpress.com/category/stock-market/

Discrimination and Life’s Blessings

Discrimination is a big feature of social life and social discourse. While discrimination conjures images of the civil rights movement and of race riots, discrimination is common in and the norm in all of human activity. For instance, if you help an elderly person to lift something, without being prompted, you have just discriminated for them on the basis of their age. The selection of a mate is nothing but the discrimination against many other possible suitors and the discrimination for your one true love. Discrimination is a curious concept in terms of when people tend to bring up the topic. While nearly ever person can all point out to times when they have personally been discriminated against, its much harder for people to point out when we discriminated against others. In fact there is little interest in discussing this side of the equation at all. Furthermore many groups that rail against discrimination and against the larger homogeneous society frequently discriminate in equal measure within their group and against the larger group as well. Thus the term discrimination actually means is..

“what others have done to me or to my group,”

…and it is more generally a plea for extra benefit based on an extremely hazy notion of fairness. Fairness being whatever improve’s the condition of the person pointing out the discrimination.

Meritocracies

Selecting for more talented people is called a a merit system and for those societies who practice it, it is called a meritocracy. People are in general in favor of a meritocracy, at least when asked their views. However, they generally work against meritocracies by attempting to use their personal connections to enhance their job prospects…this being the opposite of a meritocracy also known as a the “old boys network” and when preference is given for family members it is referred to as nepotism. How much individuals give out benefits based upon meritocracy and how much by personal connection often has to do with how competitive their own personal situation is. If they control a monopoly then there is a tendency to hire family members, if they work in a more competitive situation, then they will tend towards hiring based upon merit.

Limited Benefits

The point we want to bring up, which is very rarely brought up with regards to discrimination, is that there are a limited number of high paying jobs and a limited number of resources in general. Some type of discrimination will be used and will always be used in order to limit the access to “life’s blessings.” Improvements in the lack of discrimination for certain groups of people means fewer benefits for those that were previously the beneficiaries of discrimination. Even under the “expanding pie” fallacy, that is often employed by those that propose that there are no economic or other limitations to a society, there is is still the limit imposed by relative good. In well off societies the well off compete for benefits such as status, living location and life partners, therefore even if the pie continually expands (which it does not of course, and the environmental disaster that is happening in slow motion around us is showing the limitations of growth) there will always be a relative competition for the good things. The better and more valued something is, the less there is to go around.

How Politically Incorrect

No doubt this post will bring up a number of disagreements and form cognitive dissonance with many readers. Its extremely important to mirror the illogical way that society defines discrimination and to think of discrimination in terms of how it is often explained in US society. The author will no doubt be accused of being indifferent to the past discrimination of this group or that group. This is an expected response from those that have immediate emotional reactions to arguments. Actually this post is about the concept of discrimination and how it used to ask for more benefits, but never used to provide more benefits. If one wants to use the argument of discrimination in an unbiased way than one will spend as much time admitting one’s own discrimination against others and offering full benefits to everyone who asks, as they spend using the argument of discrimination in order to get more for oneself.

Logical Fallacies

One of the common ways that people mislead others is through the use of logical fallacies. These are arguments which are inherently flawed due to their structure. Wikipedia has a great listing of logical fallacies. Its good to refer to them when faced with interpreting arguments:

http://en.wikipedia.org/wiki/List_of_fallacies