-Caveat Lector-
Begin forwarded message:
From: [EMAIL PROTECTED]
Date: August 3, 2007 3:45:24 PM PDT
To: [EMAIL PROTECTED]
Cc: [EMAIL PROTECTED], [EMAIL PROTECTED]
Subject: Fwd: Return of the Robber Barons!!
Get a sneak peek of the all-new AOL.com.
From: "Jim S." <[EMAIL PROTECTED]>
Date: August 3, 2007 3:52:27 PM PDT
To: [EMAIL PROTECTED]
Subject: Return of the Robber Barons!!
Reply-To: [EMAIL PROTECTED]
------------------------
"America is a nation founded on the principle that all human life
is sacred...
Destroying human life in the hopes of saving human life is not
ethical."-- G.W.
Bush on the occasion of vetoing Congressional bill on stem cell
research. June
20, 2007
http://www.informationclearinghouse.info/article18109.htm
*Return of the Robber Barons*
By Paul Craig Roberts
08/02/07
"ICH" -- As the Bush Regime outfits B-2 stealth bombers with 30,000-
pound monster
"bunker buster" bombs for its coming attack on Iran, the U.S.
economy continues
its 21st century decline. While profits soar for the armaments
industry, the
American people continue to take it on the chin.
The latest report from the Bureau of Labor Statistics shows that
the real wages
and salaries of U.S. civilian workers are below those of 5 years
ago. It could
not be otherwise with U.S. corporations offshoring good jobs in
order to reduce
labor costs and, thereby, to convert wages once paid to Americans into
multi-million dollar bonuses paid to C.E.O.s and other top management.
Good jobs that still remain in the U.S. are increasingly filled
with foreign
workers brought in on work visas. Corporate public relations
departments have
successfully spread the lie that there is a shortage of qualified
U.S. workers,
necessitating the importation into the U.S. of foreigners. The
truth is that the
U.S. corporations force their American employees to train the lower
paid
foreigners who take their jobs. Otherwise, the discharged American
gets no
severance pay. [See, for example,
http://www.amren.com/mtnews/archives/2006/06/bofa_train_your.php ]
Law firms, such as Cohen & Grigsby, compete in marketing their
services to U.S.
corporations on how to evade the law and to replace their American
employees with
lower paid foreigners. As Lawrence Lebowitz, vice president at
Cohen & Grisby,
explained in the law firm's marketing video, "our goal is clearly,
not to find a
qualified and interested U.S. worker."
Meanwhile, U.S. colleges and universities continue to graduate
hundreds of
thousands of qualified engineers, I.T. professionals, and other
professionals who
will never have the opportunity to work in the professions for
which they have
been trained. America today is like India of yesteryear, with
engineers working
as bartenders, taxi cab drivers, waitresses, and employed in menial
work in dog
kennels as the offshoring of U.S. jobs dismantles the ladders of
upward mobility
for U.S. citizens.
Over the last year (from June 2006 through June 2007), the U.S.
economy created
1.6 million net private sector jobs. As Charles McMillion of
M.B.G. Information
Services reports each month, essentially all of the new jobs are
in low-paid
domestic services that do not require a college education.
The category, "Leisure and hospitality," accounts for 30% of the
new jobs, of
which 387,000 are bartenders and waitresses, 38,000 are workers in
motels and
hotels, and 50,000 are employed in entertainment and recreation.
The category, "Education and health services," accounts for 35% of
the gain in
employment, of which 100,000 are in educational services and
456,000 are in
health care and social assistance, principally ambulatory health
care services
and hospitals.
"Professional and technical services" accounts for 268,000 of the
new jobs.
"Finance and insurance" added 93,000 new jobs, of which about one
quarter are in
real estate and about one half are in insurance. "Transportation
and warehousing"
added 65,000 jobs, and wholesale and retail trade added 185,000.
Over the entire year, the U.S. economy created merely 51,000 jobs in
architectural and engineering services, less than the 76,000 jobs
created in
management and technical consulting (essentially laid-off white collar
professionals).
Except for a well-connected few graduates, who find their way into
Wall Street
investment banks, top law firms, and private medical practice,
American
universities today consist of detention centers to delay for four
or five years
the entry of American youth into unskilled domestic services.
Meanwhile, the rich are getting much richer and luxuriating in the
most fantastic
conspicuous consumption since the Gilded Age. Robert Frank has
dubbed the new
American world of the super-rich "Richistan."
In Richistan there is a two-year waiting list for $50 million 200-
foot yachts. In
Richistan Rolex watches are considered Wal-Mart junk.
Richistanians sport
$736,000 Franck Muller timepieces, sign their names with $700,000
Mont Blanc
jewel-encrusted pens. Their valets, butlers (with $100,000
salaries), and
bodyguards carry the $42,000 Louis Vitton handbags of wives and
mistresses.
Richistanians join clubs open only to those with $100 million, pay
$650,000 for
golf club memberships, eat $50 hamburgers and $1,000 omelettes,
drink $90 a
bottle Bling mineral water and down $10,000 "martinis on a
rock" (gin or vodka
poured over a diamond) at New Yorks Algonquin Hotel.
Who are the Richistanians? They are C.E.O.s who have moved their
companies
abroad and converted the wages they formerly paid Americans into
$100 million
compensation packages for themselves. They are investment bankers
and hedge fund
managers, who created the subprime mortgage derivatives that
currently threaten
to collapse the economy. One of them was paid $1.7 billion last
year. The $575
million that each of 25 other top earners were paid is paltry by
comparison, but
unimaginable wealth to everyone else.
Some of the super rich, such as Warren Buffet and Bill Gates, have
benefitted
society along with themselves. Both Buffet and Gates are concerned
about the
rapidly rising income inequality in the U.S. They are aware that
America is
becoming a feudal society in which the super-rich compete in
conspicuous
consumption, while the serfs struggle merely to survive.
With the real wages and salaries of American civilian workers lower
than 5 years
ago, with their debts at all time highs, with the prices of their
main asset --
their homes -- under pressure from overbuilding and fraudulent
finance, and with
scant opportunities to rise for the children they struggled to
educate, Americans
face a dim future.
Indeed, their plight is worse than the official statistics
indicate. During the
Clinton administration, the Boskin Commission rigged the inflation
measures in
order to hold down indexed Social Security payments to retirees.
Another deceit is the measure called "core inflation." This
measure of inflation
excludes food and energy, two large components of the average
familys budget.
Wall Street and corporations and, therefore, the media emphasize
core inflation,
because it holds down cost of living increases and interest rates.
In the second
quarter of this year, the Consumer Price Index (C.P.I.), a more
complete measure
of inflation, increased at an annual rate of 5.2% compared to 2.3%
for core
inflation.
An examination of how inflation is measured quickly reveals the
games played to
deceive the American people. Housing prices are not in the index.
Instead, the
rental rate of housing is used as a proxy for housing prices.
More games are played with the goods and services whose prices
comprise the
weighted market basket used to estimate inflation. If beef prices
rise, for
example, the index shifts toward lower-priced chicken. Inflation
is thus held
down by substituting lower-priced products for those whose prices
are rising
faster. As the weights of the goods in the basket change, the
inflation measure
does not reflect a constant pattern of expenditures. Some
economists compare the
substitution used to minimize the measured rate of inflation to
substituting
sweaters for fuel oil.
Other deceptions, not all intentional, abound in official US
statistics.
Business Week's June 18 cover story used the recent important work
by Susan N.
Houseman to explain that much of the hyped gains in U.S.
productivity and G.D.P.
are "phantom gains" that are not really there.
Other phantom productivity gains are produced by corporations that
shift business
costs to consumers by, for example, having callers listen to
advertisements while
they wait for a customer service representative, and by pricing
items in the
inflation basket according to the low prices of stores that offer
customers no
service. The longer callers can be made to wait, the fewer the
customer
representatives the company needs to employ. The loss of service
is not
considered in the inflation measure. It shows up instead as a gain
in productivity.
In American today, the greatest rewards go to investment bankers,
who collect
fees for creating financing packages for debt. These packages
include the
tottering subprime mortgage derivatives. Recently, a top official
of the Bank of
France acknowledged that the real values of repackaged debt
instruments are
unknown to both buyers and sellers. Many of the derivatives have
never been
priced by the market.
Think of derivatives as a mutual fund of debt, a combination of
good mortgages,
subprime mortgages, credit card debt, auto loans, and who knows
what. Not even
institutional buyers know what they are buying or how to evaluate
it. Arcane
pricing models are used to produce values, and pay incentives bias
the assigned
values upward.
Richistan wealth may prove artificial and crash, bringing an end to
the new
Gilded Age. But, the plight of the rich in distress will never
compare to the
decimation of America's middle class. The offshoring of American
jobs has
destroyed opportunities for generations of Americans. Never before
in our
history has the elite had such control over the government. To run
for national
office requires many millions of dollars, the raising of which puts
"our" elected
representatives and "our" president himself at the beck and call of
the few
moneyed interests that financed the campaigns.
America as the land of opportunity has passed into history.
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