Book: The Crash of 2016

Just started a book by Thom Hartmann called "The Crash of 2016."  I had to check his online presence to see if he was considered a librul or a Tea Party Patriot.

At some point the viewpoints overlap.

It's too bad the "tea party" -- which I truly believe started out as a grassroots movement -- was co-opted by the Koch brothers for their own benefit.  It should have triggered alarm bells when the fledgling movement was suddenly inundated with outside money and started showing up at rallies holding professionally-printed anti-government signs.  At some point the legitimate goals became subverted to a rather more nefarious agenda.

Thom Hartmann wrote:

It was roughly eighty years from the Revolutionary War to the Civil War, and eighty years from the Civil War to the Great Depression and World War II.  And here we are, eighty years after that great disaster.  It takes about eighty years for those who remember to thoroughly die out.

FDR may have been the last great supporter of democracy in America. He was president when I was born; I won't see another like him.

Another speech he gave in 1936:

Quote :

   We have not come this far without a struggle and I assure you we cannot go further without a struggle.

   For twelve years this Nation was afflicted with hear-nothing, see-nothing, do-nothing Government. The Nation looked to Government but the Government looked away . . . Powerful influences strive today to restore that kind of government with its doctrine that that Government is best which is most indifferent . . .

   We had to struggle with the old enemies of peace — business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.

   They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob.

   Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me — and I welcome their hatred.

Little known is the plotted coup to overthrow Roosevelt by the money men.

Yes, Hartmann just mentioned the Business Plot. I'd never heard that story.

Hartman further ties the economic boom/bust cycles to major wars:

Thom Hartmann wrote:

The economic crisis afflicting the world in the 1930s was just the first stage of a cycle that was once again descending on humanity. The next stage is always war.

History tells us that in these times of crisis, the Economic Royalists -- the bankers, industrialists, billionaires, kleptocrats, fascists -- who know exactly what's going on and whose ill-gotten gains had caused the Great Crash to begin with, immediately try to exploit the crisis to further enrich themselves. They demand compensation for their losses, extracting bailouts and enacting austerity measures on working people, squeezing what little wealth there is left in the common economy, thus deepening the economic crisis. Under calls for privatization, they assault democratic institutions, cutting off vital lifelines and services for working people.

Aware that just as nature abhors a vacuum, power does also, they use words such as "freedom" and "free market" to push for weaker government, or weaker institutions of organized people, thus clearing room for organized money to take power.

As the situation for working people deteriorates further, extremist political parties rise up. Desperate populations flock to racist and nationalistic organizations to place blame on someone or something for their economic plight. America was not spared this extremism, and there were very real moments in the 1930s when it looked like the nation might go too far. But FDR successfully navigated that fine line between far-left and far-right extremist politics that were on the rise across Europe and Asia.

But other nations did succumb.

Thus arrived the next stage of the crash: war.

Thom Hartmann wrote:

The cycles of history that led to Europe and the rest of the planet breaking into world war eighty years ago are rolling back around today.

In Greece, a modern-day version of the Nazi Party, Golden Dawn, is gaining more popularity among the austerity-ravaged people. In 2009 that party, which embraces Nazi symbolism, racism and xenophobia, had zero seats in the national parliament.

After three years of austerity, in the 2012 election Golden Dawn picked up eighteen seats in Parliament. And Golden Dawn is looking to expand its influence, not just in Greece but all around the continent.

In an earlier chapter, Hartmann compared the economy to a big game of Monopoly, where the goal is to get get all the hotels and railroads and utilities, until all your opponents have gone broke and had to leave the game.

But as he points out, in real life, if you bankrupt all your debtors you end up losing the game... not winning.

A little after that he talks about Thomas Jefferson making the case, before the Continental Congress, that no law should be permanent. Each generation should get to make their own society as they see fit, and no law or debt or restriction should be placed on the unborn. He therefore proposed a 34-year lifespan for all laws, even the Constitution, unless renewed.

Fascinating idea.

Thomas Jefferson wrote:

The question, whether one generation of men has a right to bind another [...] is a question of such consequences as not only to merit decision, but place also among the fundamental principles of every government.

For the past 3-4 years I've been increasingly disgusted by NPR.

They used to be a pretty good source of domestic news, fairly neutral and well-balanced, reporting the follies of both Democrats as well as Republicans.  They used to also cover a lot of science and technology, and do pieces on human interest stories.  It was entertaining and informative radio.  We have two NPR stations in town and they were roughly identical.

Then around 2009, 2010 the stations subtly changed.  They dropped the human interest stories.  They dropped coverage of domestic politics, unless it was to report on something noble or heroic.  They no longer did stories critical of direction or pointing out stupid policy.  They lost their 'bite.'

Instead they ran story after story after story about how horrible things are elsewhere -- mostly interminably long stories about the wars in Iraq and Afghanistan, but also long depressing stories about child labor in China, or disease problems in India, or corruption in Russia or South America.  Their programming became terminally depressing.

At the same time these "listener-supported public radio" stations became filled with ads.  "Coverage support provided by... " and then a long list, sometimes 2-3 minutes worth of names and organizations.  These lists didn't just appear at the top of the hour, either, but every couple of minutes.  The ratio of ads to programs approached that of TV, which is now easily 1 minute of advertising for every two minutes of programming.

Mrs. NoCo still has NPR on her clock radio, and this morning I slept in on purpose.  When I awakened to NPR, the penny dropped.

The chapter I just finished in "The Crash of 2016" was about the Koch brothers.  They give tax-deductible money to the economics department of universities coast to coast, with the proviso that they get to approve course curriculum and veto instructor hiring.  They veto approximately 70% of new professors.  The ones who get hired, the curriculum that gets taught, supports the Koch brothers view of the world.

THEY ARE ALSO DONORS TO NPR.

You have just described why I no longer listen to NPR.

They have been under attack from the right wing for so long that I think they just got tired of fighting.

There were so many excellent passages in "The Crash of 2016" that I could have quoted page after page after page. I was a little worried going in, the title is a bit provocative and the frontispiece lists two dozen books the author has written, many with nearly identical titles: "Thom Hartmann's Complete Guide to ADHD," "ADHD Secrets to Success," "Beyond ADHD," "We The People: A Call to Take America Back," "Screwed: The Undeclared War Against The Middle Class and What We Can Do About It." These titles did not bode well.

But it turned out to be excellently written, not hysterical at all, and full of a lot of solid and very sober facts. He does an admirable job of describing how the "Reagan Revolution" overthrew four decades of protections that had kept the economy safe and stable, causing the next 40 years to be full of booms and busts, each one bigger than the last. Savings & Loan Debacle, Enron/WorldCom/Tyco implosions, Tech Stock Boom, Housing Bubble, Derivatives Market meltdown. Each of these was caused by the same thing: too much fluid capital because taxes are too low on high earners and government policies make re-investment or starting new businesses less attractive than gambling in the stock market.

The inevitable consolidation that follows deregulating an industry -- banking, energy, communications, agriculture, manufacturing -- means that the winners have swollen so big that they are now "too big to fail" so now their losses are nationalized, while their profits are not.

Such a top-heavy economy is not sustainable, as evidenced by the 80-year repeating cycles in the economy. We are still entering into a period of "great re-adjustment" because nothing structurally was done after the 2008 mini-Depression to correct the systemic problems. In fact things are more unbalanced and unsound now than they were before the last bubble.

The author's message is sobering, and not a little scary.

What Hartmann has described is just pure and simply capitalism.

All of the serious economic problems the US has had in the past century or so, have been the direct result of capitalists scamming the game. That is the nature of the beast, and no one should be surprised by the results.

Picked up the book yesterday. Read just a few pages but will get back to it (I'm in the middle of another book right now).

I'm not sure I agree with his 80-year hypothesis.

The book generally covered ground I've read about before, albeit in a clear and concise summary. However one thing the book made me think about, that I'd never fought about before --

During the 40-year boom years (1945-1985) when the Middle Class was making great strides and even the ultra-wealthy were getting richer, what pissed off the patrician class so much that they started working to bring back the Roaring Twenties? What was so terrible about getting stinking rich from a vibrant economy?

The answer that Hartmann hints at, but never really addresses head on, is capital flight.

High taxation on big earners only works if they have no alternatives to avoid it. Once countries like the Caymans and Belize started offering tax havens to individuals and corporations -- and US tax law did not prevent them -- they started moving assets offshore and shopping for the lowest tax rates. This fostered a competition between countries to see who could be the most "business friendly" and thus eviscerate the social responsibilities of the former tax payers.

If tax law had kept capital from fleeing none of this would have happened.

Also another thought, a couple days after finishing --

Author mentions that 2016 is a likely date for the next crash but it could be either earlier or later.  He never really defined WHY he chose 2016, but I can present at least one compelling reason...

The election in November.

Seems possible, somewhere between possible and likely, that the Republican Congress will make an effort to crash the economy in late 2015/early 2016 in order to make Obama look as bad as possible and to make their own guy look better.  Regardless of who the Dems run in '16 they'll be tied to Obama's legacy and the Kochs will do everything in their power to tarnish that legacy.

Up to and including driving the economy into a ditch again.