Sunday, April 7, 2019

The Squealing of the Pigs…

You know, Paul, Reagan proved that deficits don't matter. We won the mid-term elections, this is our due.

- Dick Cheney, former CEO of Halliburton, former VP of the United States.

I’m a big believer that deficits do matter.

By J.M. Hamilton 3-9-2019

One of the great things about growing up a military brat was the experience of moving every three to four years, if not sooner, and seeing different places, meeting new people, and experiencing different cultures. Something happened this week that brought me all the way back to the ninth grade.

My family had just moved to exurbs outside of San Antonio, and my new high school had one the largest agriculture (ag) barns in the State of Texas, if not the largest. And among the typical teen groups of that era – freaks, jocks, nerds, and socials – was a new group I really hadn’t encountered before, called the kickers. The kickers were the ag girls & boys, and they spent a lot of time down at the school barn. Some of these kids would go on to college at Texas A&M.

That first Texas Spring, I heard all kinds of loud animal noises – squeals & screams – coming from the high school barn. I turned to one of my classmates, wearing a FFA blue corduroy jacket, and asked him, “What is that god-awful noise?”

The fifteen year old pulled out his pouch of Red Man, placed some tobacco in his cheek, pushed back his Resistol a little bit off his brow, and listened to the crying of the animals.

Finally, he said, “It’s nut cutting time. And the boars, they don’t like it. They don’t like it at all.”

What brought about my high school flashback, this week, was all the squealing the academic and financial elite are engaged in over MMT (Modern Monetary Theory). Ironically, while the elites maybe screaming about it, MMT has been the monetary policy of the United States, arguably, since the 2008 crash.

MMT is the belief that deficits don’t matter, because as the US possesses its own currency, it does not have to rely upon taxation, or borrowing from foreign governments, to finance federal deficits (which have been running close to, or at, on average, a trillion dollars a year, since the 2008 crash… this is projected to continue as far as the eye can see, thanks to the Trump tax cuts). Instead, deficits can be monetized by the US central bank, or the Federal Reserve… we saw this in action, post-crisis, w/ the advent of QE or quantitative easing (basically, the Fed buying US treasuries and private debt). Fortunately or unfortunately, depending upon one’s perspective, the Fed is the most powerful branch of government w/in the US and the least understood by the public. That is to say, the Fed, w/ a little help from its friends at Treasury, can print money to finance the national debt, and as of late seemingly, w/ few or limited repercussions.

So why then, the elite’s cacophony of crying and squealing?

After all, the Federal Reserve has been helping to finance the national debt, which has ballooned from approximately $10 trillion in 2008 to $22 trillion plus, today. Haven’t the elite been the beneficiaries of QE and Fed intervention into private and public debt markets? Didn’t the stock market soar; weren’t Wall Street banks, shadow banking, and the elite bailed out; didn’t asset prices rise stratospherically; taxes for the wealthy – cut; military contactors enriched by credit card wars; didn’t the rich get richer… thanks to the Fed and MMT?

Absolutely.

And therein lies the rub or the tension. The financial elite – which owns the government and has captured fiscal, foreign, monetary, and tax polices (not to mention all four branches of government) – really doesn’t mind the Fed financing deficits, as long as they are the beneficiaries. But the second a few Dems, and some liberals, talk about taking the Fed’s bazooka and firing it at real problems, like: a planet in flames; free college education; an economic bill of rights; and wage & wealth inequality (last seen at these levels, during the Gilded Age)… well, then there’s a problem.

The elite, as I recently argued, have rigged a perpetual profits machine, and the engines of that machine are the Federal Reserve and the debt driven economy. And the elite like the financialization of the US economy; they like the rigged system they have built for themselves; they like – w/in the US – the preeminence of Wall Street banking, shadowing banking, and the ultra- mercenary, private equity machine. It requires so little effort to mint profits from cartel & monopoly, and gutting a company’s credit line and employee pension.

Finance is the tail that wags the Main Street dog, and the Lords of Finance – who own the establishment politicians – aren’t about to give that up. They want the conduit for Fed policy to remain the Wall Street banks & the stock market; they like trickle-down monetary policy, as it effectively, sterilizes the money flowing out of the Fed, and for the most part, keeps it out of the public’s hands.

In this manner, inflation is contained.

Inflation, Weimar Germany hyper-inflation, is the primary argument that the academic and financial elite raise against MMT.

What inflation JM? Great question… glad you asked.

Many economists and financial eminentos (as well as myself) predicted that as a result of the Fed’s balance sheet expansion, the mopping up of US debt, and all the liquidity and money printing injected by the central bank into the economy that inflation would set in. But inflation hasn’t set in… which would debase the buying power of the dollar, as well as, harm faith in the dollar as a storehouse of value. Why?

First, thanks to the Fed’s cheap money policies, M&A has exploded. This has created cartels & monopolies, which exert monopsony power over a thoroughly defeated US labor market. In short, here in the US, as workers compete for fewer and fewer well paying jobs against global labor (thank you automation, AI, & industry consolidation, as well), wages are suppressed, while management and the ownership class take nearly all income gains .

Second, as the US imports many of its products, due to the offshoring of labor & manufacturing, EM nations are exporting their disinflation – exceptionally low wages – to the United States (which is good if you are a consumer, and absolutely sucks, if you are an American w/ a high school education, or less, and are attempting to find a well paying job). A quick shout out to my favorite news show, Bloomberg Surveillance, for bringing up this salient point this week.

And third, all the central banks are doing it. If the US was alone in suppressing interest rates, expanding its balance sheet, and engaged in debt monetization, through QE… The US dollar would no longer be the world’s fiat currency. But as the BOJ, the ECB, and the PBOC are all engaged in monetary sleight of hand, as well as other central banks, the impact to the dollar appears minimal. As a result, the almighty US dollar and the Federal Reserve – for now – have suffered no ill effects. In short, there’s a cartel of central banks engaged in monetary welfare for the global kleptocracy, and as long as they play nicely together, the currencies cannot be played off one another (such that it alters the various currencies' balance of power).

Bottom line: Inflation is nowhere to be seen. That is to say, as long as global M&A – and industry consolidation - continues at its extraordinary pace, it remains an employers’ job market… and as long as the plutocracy continues to keep all the economic gains of the global economy for itself (effectively, sterilizing central bank largesse), and central banks continue in lockstep w/ the same easy money policies, directed through a cartel of global banks… don’t expect inflation anytime soon.

Forcing the issue further is nation state debt itself… the central banks can only allow interest rates to creep up so high (higher interest rates would contain M&A and provide interest income to retirees and savers), before nation state debt service loads wreak havoc on government budgets.

So does MMT work, can it work? JMH can tell you this, it has worked exceptionally well for the 1% for a decade, to such an extent that we now live in a Neo-Gilded Age.

What liberals are talking about, in regards MMT, is the end of sterilization in the money supply, & largesse, issued forth by the Fed. And the end of monetary sterilization – monetary policy nut cutting time, if you will - is what causes the elites to squeal, like barnyard animals in springtime.

If the Fed largesse was to shift away from Wall Street, and be redirected at the American public - via a Green New Deal, a jobs guarantee, or a UBI – wages would rise, and this would crimp profits in the private sector. And this is what is so upsetting to the robber barons… the fact that their perpetual profits machine, loaded w/ debt, may suffer a rise in wages.

Moreover, workers - unlike the financial elite – tend to spend the money they make, and if aggregate demand outstripped aggregate supply, this, in turn, could actually bring about inflation (the very inflation, the Fed is said to have long sought). A possible rise in inflation, in turn, may cause greater scrutiny of our cartel and monopoly driven economy… the primary biz model of the cartel & monopoly economy is to restrict the supply of products & services - or fix price - to drive profit maximization.

With populism all the rage, the elites don’t want that kind of scrutiny. The model won’t bear it.

As with all things economic & monetary, when treading in unfamiliar territory, the keys to implementing an economic bill of rights, a jobs guarantee, and a UBI - financed by the Federal Reserve & MMT – would be to do so at a gradual pace. Arguably, the benefits of MMT, to date, have accrued exclusively to the 1%. Therefore, it’s long past time to spread the wealth, by redirecting Fed largesse to policies that directly help the 99%.

As for a Green New Deal, that can’t wait.

Here, the elite need only ask themselves: What good is being wealthier than King Midas, if the planet is destroyed?

Weimar Style

Short to intermediate term, I have to side w/ Cheney on deficits… longer term, unless we want to go to negative yields (which would erode debt and the principle itself, as has been done in other countries – see Germany & Japan), I have to side w/ Mr. Fink. Eventually, the national debt will have to be addressed, via a haircut.

At the end of the day, the elite have already jumped the Rubicon, and are fully engaged in MMT (aka QE). They have captured government and government policies (especially, the Fed & monetary policy) for their own personal enrichment. The elite favor deficits and debt when it enriches them, but are terrified of spreading the wealth to the 99%: partly because of their insatiable lust for profits; unmitigated greed; and partly, because they fear, greatly, a highly successful Northern European socialist model placed w/in the US.

(The elites, also, like to believe they are self-made, when in reality many are as socialist as they come. That is, their wealth, often, was obtained by crony contacts w/in government, and a rigged system. MMT, in the hands of liberals, would upend the top-down/trickle-down approach of our economy, and redirect, to a greater degree, to a bottom-up approach, or a 99% first tack).

After all, how are you going to keep boys and girls down on the farm - and dependent upon slave wages, multiple jobs, & Oxycontin - once they’ve had a taste of a highly successful mixed economy, European model (w/ a healthy dose of socialism to ameliorate the effects of a predatory, crony-capitalist system)?

The longer term solution, of course, and what will, almost, inevitably happen – as the entire house of debt is unsustainable - is there will need to be a, gradual, national debt write down. And only central banks have that kind of power to forgive that much debt. Stakeholders in our current catastrophic debt levels, those who make income off that debt – banks, shadow banking, and multinationals - are all that stand in the way of a longer term solution, and, likely, an inescapable write down (that will free up global governments to serve the will of the people & enterprise, via fiscal & monetary policies).

In the meantime, please consider hearing protection to muffle the screams & squealing.

Copyright JM Hamilton Publishing 2019

Regulatory Capture in the Age of Trump

FAA employees warned as early as seven years ago that Boeing Co. had too much sway over safety approvals of new aircraft, prompting an investigation by Department of Transportation auditors who confirmed the agency hadn’t done enough to “hold Boeing accountable.”

- Boeing Had Too Much Sway in Vetting Own Jets, FAA Was Told – Bloomberg

By JM Hamilton (3-24-2019)

JMH spends a great deal of time describing the financial elite’s capture and takeover of the US government - indeed, most Western governments - via fiscal, foreign, judicial, monetary, and regulatory policy capture. The term “capture” can seem, at times, so ubiquitous that after awhile it can lose all sense of meaning.

This week, we break down regulatory capture in particular, and offer up some recent examples. There are two primary reasons to visit this issue: a) regulatory capture demonstrates how short-term myopia, driven by greed, often gets the better of the management & ownership class; and b) recent examples of regulatory capture, and the subsequent fallout, are piling up like so many wrecked cars, during an ice-storm on a miserable winter night.

Investopedia offers up the following definition of regulatory capture:

Regulatory capture is an economic theory that says regulatory agencies may come to be dominated by the industries or interests they are charged with regulating. The result is that the agency, which is charged with acting in the public's interest, instead acts in ways that benefit the industry it is supposed to be regulating.

That pretty much describes it. Regulatory capture has been around for decades, if not for centuries. None other than Adam Smith described the tendency of private enterprise to seek out favors from government, not the least of which are: removal of government oversight, and grants of monopoly, so as to maximize profits. Commercial interests often believe that if they can just rid themselves of those pesky regulators, they can send their products and services to market faster, and start generating revenue and profits sooner. Besides, as any capitalist - or establishment Dem or Republican - will tell you, markets are self-regulating. And that last part - markets are self-regulating - might be partially true within a healthy capitalist economy, as defined by many businesses competing w/in the same products or services sector. One major slip up - on a failed product or harmful service launch - and your company could very well become toast, as your competitors fill the product & reputational void.

But in today’s monopoly economy, healthy regulatory bodies - designed to protect consumers, labor, and yes, even companies and investors from possible ruin - are more important than ever before. In short, regulatory bodies, properly functioning, aren’t designed to thwart business, but rather, provide the rules of the road – the guardrails, if you will - for a healthy and safe economy, benefiting all factions: consumer, labor, management; & ownership.

Perhaps that is why successive Dem and GOP administrations – who all too often have willingly bought into the neoliberal paradigm (that markets are self-regulating) – have not only damaged (& underfunded) rules enforcement, regulations, and the regulatory bodies themselves, but also, in some cases, done irreparable harm to the businesses & investors they attempted to help through deregulation. But perhaps no administration has done more to make a farce of deregulation, & regulation, than the corrupt & crony Trump government. The Trump administration has allowed the revolving door to spin like a top between industry insiders & lobbyist, and the regulatory bodies.

To such as extent, the fox no longer guards the regulatory henhouse, but instead, the fox has purchased both the farm and the henhouse.

Under POTUS Trump, the regulatory swamp runneth over.

Here then, some ongoing & recent examples, of regulatory capture gone horribly wrong.

Boeing, the FAA, and the 737 MAX 8: It took two downed aircraft, the loss of more than three hundred lives, and globally, aviation regulators shutting down the 737 MAX 8, before the Trump administration and the FAA grounded and shutdown Boeing’s plane. Since then, it’s come out that the FAA has not only abrogated its responsibilities, but basically, has relied upon Boeing to self-regulate and certify the safety of its aircraft. Meanwhile, as the plane remains grounded, Boeing is suffering: unprecedented reputational costs; economic damages, as airlines pursue the loss of revenue from grounded equipment; cancelled existing and, possibly, future orders of the 737 MAX 8; future litigation from families of the deceased travelers on the two doomed aircraft; likely, shareholder litigation; a criminal investigation is underway; and significant loss of market cap – now running into the billions – as Boeing’s stock shares tank.

And thanks to industry consolidation, Boeing is likely too big to fail. Could a taxpayer funded bailout be around the corner?

We’ll find out. Here again, is an underfunded regulatory body, the FAA, that used to be respected around the world, and now, is a laughingstock. The black box, from the doomed Ethiopian crash? Sent to France for review and analysis. The FAA, along w/ Boeing, not only failed the customers & flight crews of the two doomed aircraft, but it also arguably failed itself, as a regulatory body, and the employees, management, and ownership at Boeing.

But ultimately, the blame goes to Congress – particularly the GOP - for underfunding regulatory bodies for decades, and failing to control the revolving door between the regulatory bodies and the industries the regulators were designed to oversee. Basically, crony capitalism in overdrive.

The FTC, the Justice Department, Failed Antitrust Enforcement, and Industry Consolidation on an Unprecedented Scale: In the last couple of weeks, Americans have seen the completion of several monster media mergers, like: Disney/Fox and AT&T/Time Warner. Now, Americans can receive their entertainment content and news – live streamed or televised – from several corporate leviathans.

And US news content will continue to increasingly become more homogenized, and sanitized, so that real news about government corruption, and the capture of our regulatory bodies by major corporations, conveniently, never makes it on the air, or, at most, receives very abbreviated attention. Increasingly, national news shows – overseen by their corporate masters – are often devoid of content, superficial, and substance free. Want real news, you'll need to read it from several different sources.

Here, blame the Justice Department and the FTC, not only for media concentration and cartel formation, but also concentration and vertical integration in industry after industry.

The formation of cartels and monopolies – and the failure of the FTC, Justice Department, & courts to enforce antitrust laws - has played no small role in: the formation of a Neo-Gilded Age; unprecedented wage & wealth inequality; the crushing of jobs, opportunity, & innovation; but also, a dearth in the number of startups and the elimination of animal spirits.

Want to know why the American Dream is dead? Look no further than the failure to expand and enforce antitrust laws.

The Federal Reserve, the Office of the Comptroller of the Currency, FDIC, et al., and Wall Street & US Banks: The Federal Reserve is one of the primary regulators of Wall Street banks. And today, Congress, the Fed, and various regulatory agencies are back at it: rolling back banking & derivatives regulations; lowering capital requirements (thanks to off balance sheet transactions, & offshore subsidiaries, who knows if the capital presently required is sufficient?); and enabling Wall St banks, US banks, and largely unregulated shadow banking to set America up for the next crisis.

Whether it’s allowing self-dealing (see the ISDA), the continuation of a derivatives & swaps market worth hundreds of trillions in notional value, watering down & dragging out rule making & enforcement (see the Volcker Rule), or allowing junk debt to continue to be rolled up into CDOs or CLOs and often, sold as an investment grade security instruments… the Federal Reserve, Congress, and the regulatory authorities were at the center of the 2008 crisis and will likely, be at the center of the next financial storm.

Complicit in all this, Congress often relies upon the banking industry, and their lobbyist, to write regulatory legislation that is vague, and ultimately, largely relies upon underfunded & understaffed financial regulatory bodies to interpret & enforce. Predictably, Congress, owned by the banks, passes the buck onto captured regulatory authorities. Moreover, some financial enforcement falls at the state level… all of which, further contributes to barriers of entry and the preeminence of the existing Wall Street banking order.

At this point, it would be hard to argue that Wall Street banks provide few, if any, products & services that are for the public good. Many Wall Street bank products & services have an angle, or binary outcome: their enrichment and the counterparties’ or public’s loss (see Wall Street’s role in financing private equity and LBOs). To this day, Wall Street banks remain too big to fail, the bulk of the derivatives sold are used for speculation and gambling, and yet, these banks remain federally insured (that is to say, reinsured by the US taxpayer).

And the banking cartel is responsible for the transmission of the Fed’s monetary policy, which now serves – nearly exclusively – surprise, Wall Street banks and the stock market. Ultimately, the Wall Street cartel serves itself, first & foremost, not the American economy, and certainly not, the majority of Americans.

What goes up is supposed to land, not crash…. Like Boeing’s planes & stock valuation.

We could go on and on.

The Congress insisting that the DEA not investigate Big Pharma over the opioid crisis; the Congress working with Big Pharma & the FDA to keep patented medication protected and existing drug monopolies & monopolistic pricing in place.

Is the EPA complicit in the growing Bayer, Monsanto, and Roundup scandal?

More than likely, yes.

At the center of regulatory capture is the stock market as the sin qua non of all economic endeavor, and the market’s constant need for higher and higher stock valuations and dividends. The market demands monopoly and monopolistic returns. The market demands that the consumer and labor always come last, and that regulatory authorities bow down to the very industries they are supposed to regulate. And the monopolies always insist that they need scale, colossal scale, to compete on the global stage; but that scale often comes – not w/ economies of scale – but diseconomies of scale. That is to say, the monopoly or multinational becomes so byzantine & Kafkaesque that no CEO, or management team, could possibly possess the ability to run, effectively, these giants.

Add in C-Suite pay packages, and the regulatory doom loop is complete:

The stock market + CEO pay packages + captured regulatory authorities & Congress = products, services, and business outcomes that are – all too often – detrimental to consumers, labor, the taxpayer, and in the long run, investors and shareholders (REPEAT).

Just ask the management team at Bayer, who purchased Monsanto, or perhaps, ask Boeing how regulatory capture - and FAA ownership - has worked out for them?

Some call it regulatory capture… JMH would argue its karma working its way around, inevitably, to bite the apex predators where it hurts most, in the wallet.

Saturday, February 23, 2019

The Union of Soviet Socialist Multinationals

Amazon, the e-commerce giant helmed by the world’s richest man, paid no federal taxes on profit of $11.2 billion last year, according to an analysis of the company’s corporate filings by the Institute for Taxation and Economic Policy (ITEP), a progressive think tank.

Thanks to a variety of tax credits and a significant tax break available on pay handed out in the form of company stock, Amazon actually received a federal tax rebate of $129 million last year, giving it an effective federal tax rate of roughly -1 percent.

It is the second year in a row the company has enjoyed a negative federal tax rate on a multibillion dollar profit. That would place the company’s effective federal tax rate below the rate paid by the poorest 20 percent of American households, which had an effective federal tax rate of 1.5 percent in 2015, according to the Tax Policy Center.

Amazon paid no federal taxes on $11.2 billion in profits last year – Washington Post

By J.M. Hamilton (2-23-2019)

The City of New York received a three billion dollar – Valentines’ Day – gift card from Amazon, when the company announced it would not accept the city’s welfare, and would not be setting up an alternative headquarters w/in the city’s boroughs.

It’s just the latest example of the corporate relo welfare that has run amuck w/in these United States. Relo welfare is characterized, whereby local muni and state politicians, throughout the country, bid against one another in the hopes of bringing in an ever-shrinking pool of well paying jobs to their hometown. The prizes for the multinationals are often free tax breaks, possibly land, infrastructural improvement, and preferential treatment by the local establishment; the prizes for politicians maybe an assortment of campaign contributions, endorsements, PAC money, political advertising, perhaps philanthropic contributions to foundations - used for political purposes, and possibly, dark money.

During that same Valentines’ week, another news story broke, reporting that Amazon made $11.2 billion in profits, and would be paying no taxes on any of it… and in fact, due to a rigged tax code, would actually be receiving money, or a tax rebate, back from the government.

And politicians - allegedly the nation’s leaders - wonder why all the well paying jobs are drying up, and the country is bust w/ national debt at 22 trillion dollars and counting.

Tax cuts for the rich (aka billionaires & multinationals); the plutocracy’s capture of federal & state governments; the political class’ abdication of the responsibility to regulate markets, and protect consumers, citizens & labor from the ravages of cartel, monopoly, & monopsony powers; the billions gifted to Wall Street banks, shadow banking, and multinationals daily, via the Federal Reserve… all have left politicians, of the weaker mindset, w/ limited leverage, and little recourse, but to throw additional welfare at multi-billionaire dollar organizations in the hopes of bringing in jobs.

Otherwise, an angry multinational might pick up their toys, like Amazon did, and run to a less meddlesome locale.

There are a handful of politicians, of the stronger mindset, however, who actually give a damn, and care about ordinary Americans. Senator Sanders was exceptionally successful in launching a populist campaign that caused Mr. Bezos to raise Amazon’s minimum wage to fifteen dollars an hour. This, in lieu of Amazon engaging in another form of corporate welfare, practiced daily w/in the US, where multi-billion dollar corporations pay their employees a nonliving wage, and let the taxpayer foot the bill for the balance necessary to keep those underpaid workers alive. This is nothing less than a direct subsidy to the multinational’s bottom line.

And perhaps, all this entered into Amazon’s calculus, when it abandoned NY. The world's richest man - going through a messy divorce, w/ alleged “dick pics” at the National Enquirer; lambasted by Senator Sanders over minimum wages & government subsidies; and a nasty battle brewing w/in the country’s greatest metro area, NYC, over corporate relo welfare….

No wonder Amazon bailed.

Mr. Trump and the GOP are said to be salivating about tarring the 2020 Democratic nominee as a socialist. However, the true welfare queens (a trope exploited at its apogee, by candidate Reagan) are US multinationals, who never miss a trick w/in our rigged system to profit, by stealing from the government & the taxpayer. Despite all the Ayn Randian chest-thumping about rugged individualism, with monopolies, always remember, what is theirs is theirs - unless there are losses, and then, they are socialized - and what is yours is theirs, too. The government exploitation angles are too numerous to count. That’s why they hire, McKinsey & Co.

Google, another multi-billion dollar tech behemoth, also plays the relo game. Google comes to cities, states, and towns – w/ agreements of sworn secrecy (like Amazon, there can be no transparency), and wearing the mask of some derivative LLC or made up corporate name – seeking welfare and tax subsidies, too. Except Google is really quite shrewd. In that, taking a page directly from the military industrial complex’ playbook, Google is spreading themselves around the country and throughout the globe's nations. Per the WashingtonPost, Google now has a geographic footprint that includes seventy offices worldwide, including “15 data centers on three continents.” Alphabet Inc. (aka Google) knows that if they can provide a sprinkling of jobs to as many states as possible - spread the wealth, so to speak - fewer politicians will have the courage, or temerity, to challenge Google on: privacy; the plundering of personal data; its monopoly; and a tech industry/company that has jumped into bed w/ the Deep State and the MIC, itself.

Meanwhile, the disenfranchised, the poor, the middle class, mothers and children… are told to enjoy a nice steaming bowl of austerity, because the government has maxed out the country’s credit line on the true welfare queens: US multinationals, Wall Street banks, and MIC contractors.

Socialism & welfare for billionaires & multinationals, and austerity & bootstraps for our children and the poor: no wonder the US birthrate – in certain states, particularly among Trump voters – is lower than the death rate. Meanwhile, relo welfare rarely, if ever, pays the purported dividends/results back to the muni or state, in terms of increased jobs or an expanded tax stream (just ask Wisconsin’s former governor, Walker, about Foxconn).

Союз Советских Социалистических Транснациональных Корпораций

JMH has written extensively about holding corporate leadership accountable for our crony economy & government. But perhaps, simultaneously, it’s time to hold our owned politicians accountable as well.

As there are clawback provisions written into some C-Suite contracts - whereby in the event of accounting irregularities, or fraud, the offending executive forfeits bonus and pay - perhaps it's time to have similar provisions w/in politician pay? (Note, the proposed politician clawbacks are not a substitute for campaign finance reform, term limits, nor caps on the duration of the campaign season, and a whole host of other democratic & lobbying reforms.)

What better way to restore the public trust in Congress, and state and local legislative bodies & counsels? Start with written accountability, performance, and transparency standards, deduct 20 to 25% of the political class’ pay and campaign contributions, and hold it in escrow for ten years. At the end of ten years, if there’s no accountability, performance, or transparency violations, said politician receives the pay/campaign contributions that were set aside ten years prior. Otherwise, if there’s a deviant malfunction, or some other sordid scandal, then said contributions/pay becomes forfeit, and the taxpayer’s property (or perhaps a victims fund is financed from forfeit pay).

Some might argue this is civil forfeiture in reverse (which SCOTUS took a hammer to just this week); but if a law has been broken, or fraud committed, then arguably, due process has occurred.

In short, if we are going to clean up our basket case of a democracy, and the crony –economy, we need to hold both camps responsible: not only our elected politicians, but the billionaire, C-Suite & multinational class, as well.

It seems that when it comes to doing backroom deals, the Union of Soviet Socialist Multinationals, and our elected politicians, just can’t help themselves, enough.