Do Not Crucify the Citizens of the World upon a Cross of Debt…
Around the world, the number of
millionaires and billionaires is surging right along with the value of their
holdings. Even as economic growth has slowed, the rich have managed to gain a
larger slice of the world’s wealth.
Globally, almost 18 million households control more than $1
million in wealth, according to a new
report from the Boston
Consulting Group. These rich folk represent just 1 percent of the world’s
population, but they hold 45 percent of the world’s $166.5 trillion in wealth.
They will control more than half the world's wealth by 2021, BCG
said.
Rising inequality is of course no surprise. Reams of data have
shown that in recent decades the rich have been taking ever-larger shares of
wealth and income—especially in the U.S., where corporate profits are
nearing records while wages for the workforce remain stagnant.
- The U.S. Is Where the Rich Are the Richest,
Bloomberg
By J.M. Hamilton (6-18-2017)
Historians and political
scientists will tell you that one of the greatest American campaign speeches
ever delivered was by a little known congressman from the State of Nebraska,
Mr. William Jennings Bryan. In 1896, the
upstart congressman advocated the inflationary policies surrounding the free
coinage of silver, versus the Republican Party’s gold standard. Ever the populist, and arguably a Tribune for
the American people, Mr. Bryan would also go on to advocate anti-imperialism
and trust-busting. And in 1896, Mr. Bryan would become the Democratic Party's presidential nominee.
Then as now, bankers &
the oligarchy dominated monetary policy.
The economic elite, of that day, advocated the gold standard, and restrictive
monetary policy that preserved U.S. currencies value, first and foremost (arguably
to the point of having a deflationary, and deleterious, impact upon the U.S.
economy). In 1896, the GOP nominated Mr.
McKinley, who ran on a platform in support of: The Gold Standard (a/k/a sound money);
Protectionism (i.e. high tariffs); and support for the Trusts and economic
growth. Ultimately, Mr. McKinley won the
race, narrowly winning the popular vote, and winning the electoral college by a
much larger margin. POTUS McKinley would
go on to formally install the gold standard, which would play a key role in U.S. monetary policy,
until POTUS Nixon took the U.S. off the gold standard.
Then as now, the American
economy was prone to: boom and bust cycles; speculation in commodities,
currencies, & stocks; dominated by cartels and trusts; and the American
worker was well on their way, from abandoning the farm to becoming a cheap and
highly exploited form of industrial labor.
Today, many of America’s industrial jobs have been lost to free
trade/globalization, AI, and automation.
Moreover, today’s multinationals prefer to exploit labor in emerging markets – often run by dictatorships & totalitarian regimes – for pennies
on the dollar.
In reading Mr. Bryan’s famous
Cross of Gold speech today, we can see that the more things change, the more
they stay the same. In short, the
circumstances that led to Mr. Bryan’s rise have occurred again in America and
led to the ascendancy of the Sanders/Warren wing of the Democratic Party. Or perhaps, the economic circumstances that
led to the rise of late 19th Century populism really never went
away? They were just ameliorated & contained by the New Deal/Great Society programs and the social
safety net that provides a backstop – or safety valve - for predatory
capitalism’s fallout?
What follows then are excerpts from Mr. Jennings’s
famous Cross of Gold speech. See if any
of this sounds familiar?
o
We say to you that you have made too
limited in its application the definition of a businessman. The man who is
employed for wages is as much a businessman as his employer. The attorney in a
country town is as much a businessman as the corporation counsel in a great
metropolis. The merchant at the crossroads store is as much a businessman as
the merchant of New York.
o The miners who go 1,000 feet into the earth or climb 2,000 feet
upon the cliffs and bring forth from their hiding places the precious metals to
be poured in the channels of trade are as much businessmen as the few financial
magnates who in a backroom corner the money of the world. We come to speak for
this broader class of businessmen.
o We are fighting in the defense of our homes, our families, and
posterity. We have petitioned, and our petitions have been scorned. We have
entreated, and our entreaties have been disregarded. We have begged, and they
have mocked when our calamity came.
o What we need is an Andrew Jackson to stand as Jackson stood,
against the encroachments of aggregated wealth.
o The income tax is a just law. It simply intends to put the
burdens of government justly upon the backs of the people. I am in favor of an
income tax. When I find a man who is not willing to pay his share of the burden
of the government which protects him, I find a man who is unworthy to enjoy the
blessings of a government like ours.
o If you will read what Thomas Benton said, you will find that he
said that in searching history he could find but one parallel to Andrew
Jackson. That was Cicero, who destroyed the conspiracies of Cataline and saved
Rome. He did for Rome what Jackson did when he destroyed the bank conspiracy and saved America.
o We believe it is a part of sovereignty (the coinage of money)
and can no more with safety be delegated to private individuals than can the
power to make penal statutes or levy laws for taxation.
o
I stand with Jefferson rather than with them,
and tell them, as he did, that the issue of money is a function of the
government and that the banks should go out of the governing business.
o
What we oppose in that plank is the life
tenure that is being built up in Washington which establishes an office-holding
class and excludes from participation in the benefits the humbler members of
our society. . . .
o
I reply that if protection(ism) has
slain its thousands the gold standard has slain its tens of thousands.
o … there is scarcely a state here
today asking for the gold standard that is not within the absolute control of
the Republican Party.
o Mr. Carlisle said in 1878 that this was a struggle between the
idle holders of idle capital and the struggling masses, who produce the wealth
and pay the taxes of the country.
o My friends, it is simply a question that we shall decide upon
which side shall the Democratic Party fight: Upon the side of the idle holders
of idle capital, or upon the side of the struggling masses?
o The sympathies of the Democratic Party, as described by the
platform, are on the side of the struggling masses, who have ever been the
foundation of the Democratic Party.
o There are two ideas of government. There are those who believe
that if you just legislate to make the well-to-do prosperous, that their
prosperity will leak through on those below (a/k/a Trickle Down). The
Democratic idea has been that if you legislate to make the masses prosperous
their prosperity will find its way up and through every class that rests upon
it (a/k/a As noted by JMH: Flood Up).
o (On the issue of sovereignty) My friends, we shall declare that
this nation is able to legislate for its own people on every question without
waiting for the aid or consent of any other nation on earth.
Ah, history
repeats, again and again. The
malefactors of privilege & wealth (a/k/a The Rentier Class) always find a
way to capture government, and fiscal & monetary policy, for their own
ends. The oligarchy, continuously, preys
upon the 99%. Seemingly, little has
changed since Mr. Bryan gave his famous speech (but for a brief shining period
ushered in by Mr. Roosevelt and the application of his famous and much loved New Deal policies).
How
ironic that the GOP’s perceived Halcyon Days – the 1950s – saw: the apogee of
New Deal policies, culminating in the highly socialist GI Bill; a rising &
prosperous middle class driven economy (backstopped by the New Deal's social safety net); and
one of the highest upper income tax rates the nation had ever seen at 91% (only exceeded during WW II).
Now, the point
of today’s piece is not to debate the merits of the gold standard. Libertarians, such as Representative Ron
Paul, have long made a strong case for the gold standard, and there are
demerits and merits to that case, just as there are demerits/merits for a free-floating
fiat currency. The bottom line is when
it comes to fiscal or monetary policy, it’s all about how said policy is
utilized or manipulated. That is to say,
as a force for good & the many, or as a force to enrich an elite few?
No,
today, Mr. Jennings wouldn’t be railing against the gold standard, but my guess
is Mr. Jennings and his followers, instead, would be railing against a global
pandemic of debt (especially, the United States’ national debt).
A pandemic
of domestic debt set off by: deregulated banks & shadow banking (&
bailouts for same); wars w/out end financed by credit card; and tax cuts for
multinationals & the uber
wealthy, again financed by the U.S.’ credit line (and w/ no offsetting cuts to
spending to finance any of this welfare for the oligarchy). Instead, all the above entitlements for the
wealthy are funded by ultra-accommodative central bank policies and debt, and
debt service payments, as far as the eye can see. Adding fuel to the debt fire, the U.S. economy
is based not upon manufacturing and savings (under the current monetary policy regime savers are actually discouraged &
penalized); but rather, the U.S. economy is based upon debt, finance, speculation, global arbitrage, rent seeking predatory cartels & monopolies, and war.
The national debt has a crushing impact upon fiscal & social policy (read austerity), and has
led to overreliance upon monetary policy, which arguably, has let our elected
politicians off the hook from conducting the affairs of state. Why be worried about governing, fiscal policy, the
national debt, debt service load on same, and war w/out end, while the Fed’s
printing presses burned and churned? This
overreliance upon monetary policies, and our ever expanding national debt, fuels
interest rate suppression (which essentially is stealing from savers and
retirees). Aggravating our predicament
further, ultra-accommodative central bank policies funds the financialization
of economy (a/k/a financial engineering): affording cheap finance for job killing and tax base crushing M&A (and coming soon, during the next economic down turn, a spike in the number of bankruptcies).
That is to say, the beneficiaries of the Federal Reserve's exigent efforts have gone to an elite few, at the expense of a great many.
That is to say, the beneficiaries of the Federal Reserve's exigent efforts have gone to an elite few, at the expense of a great many.
Ironically,
the debt scolds (a/k/a the GOP/Dem Establishment), utilize the national debt to
demonize entitlement spending, such as Food Stamps, Social Security, Medicare,
& Medicaid; and yet, these same scolds have zero issues w/ jacking up the
national debt to pay for Wall Street bailouts, tax cuts for the wealthy, war
w/out end, and the U.S. global empire (as best illustrated by 700 to 900
military bases spread around the globe).
If one has any doubt that the tax cuts for the wealthy, and endless war, sent the deficit spiraling ever higher? Please see POTUS Clinton's budget surpluses, and the rise of deficit spending again, w/ the advent of the Bush W. tax cuts and ill-fated Afghanistan & Iraq war start ups.
If one has any doubt that the tax cuts for the wealthy, and endless war, sent the deficit spiraling ever higher? Please see POTUS Clinton's budget surpluses, and the rise of deficit spending again, w/ the advent of the Bush W. tax cuts and ill-fated Afghanistan & Iraq war start ups.
And this is exactly why, the bankocracy that thrives on nation state debt - and the easy
money policies of central banks, globally - must be put down & broken
up. A new Bretton Woods should be called
for to deal w/ the global debt crisis. In
short, global public debt must be written down in a coordinated and methodical fashion
among nation states, before calamity and more war ensues (martial & trade).
Far too many
Americans and citizens of the world – particularly children – are
undernourished, under-schooled, and receive inadequate medical care, so that
the oligarchy can max out government credit lines to pay for greater and
greater: tax cuts, government contracts, privatization, the military
industrial complex, and all manner of evil negotiated behind closed doors.
And
why? So that some behemoth multinational
or Wall Street bank can hit next quarters’ target?
This is no
way to run a planet.
As Mr. Bryan might have
said: You shall not crucify
mankind upon a cross of debt.
Copyright JM Hamilton Publishing 2017
