Another Obama adviser who targets health care is David Cutler  OBAMA'S TOP ECONOMICS GURU: AUSTAN "THE GHOUL" GOOLSBEE  Jeffrey Liebman Of Harvard, Top Economics Advisor To Obama,   Pinochet did not have an economic plan of his own, and by 1975 inflation would run as high as 341 percent. Into this crisis stepped a group of economists known as "the Chicago boys."

Obama's Plan To
Privatize Social Security
Jeffrey Liebman Of Harvard, Top Economics Advisor To Obama,
Wants To Privatize Social Security - Just Like The Sinister Bush Plan Americans
Resoundingly Rejected In 2005.  Benefits Cuts And Higher Payroll
Taxes Are Also On Obama's Agenda.

By Webster Tarpley
2-6-8

 

Obama’s economic advisers
January 9, 2008

BRZEZINSKI SEIZING CONTROL
OVER US POLICY

IN SLOW-MOTION CREEPING COUP

By Webster G. Tarpley

Barack Obama - America's
First Jewish President

By James Petras
12-13-8
.....Think about it: Not only do the Zionists
and their embedded clones rule the White House,
they also have the political apparatus
(left, liberal, center and right) to silence, insult,
witch hunt and isolate any critic of their agenda,
their organizations and of the State of Israel.
When confronted by a critic the entire apparatus
brays in unison about 'anti-Semitism'
and follows up with severe civil sanctions...

THE OBAMA DECEPTION video

 

Obama's Plan To
Privatize Social Security
Jeffrey Liebman Of Harvard, Top Economics Advisor To Obama,
Wants To Privatize Social Security - Just Like The Sinister Bush Plan Americans
Resoundingly Rejected In 2005.  Benefits Cuts And Higher Payroll
Taxes Are Also On Obama's Agenda.


By Webster Tarpley
2-6-8
 
 
Liebman has supported partial PRIVATIZATION of the government-run retirement system, an idea that is rejected by many Democrats and bears a similarity to a proposal for so-called "personal investment accounts" that Bush promoted in 2005.
 
"Liebman has been open to private accounts," said Michael Tanner, a Social Security expert at the Cato Institute in Washington, a think tank in Washington that advocates "free markets" and often backs Republicans.
 
The Liebman-MacGuineas-Samwick plan to loot Social Security also promises raising regressive payroll taxes, cutting benefits, or a combination of both.
 
 
OBAMA'S DOUBLE TALK ON SOCIAL SECURITY: "Everything should be on the table." (May 2007) This leaves the door wide open to Liebman's privatization plan.
 
WARN OLDER PEOPLE AND RETIREES THAT OBAMA AND HIS CLIQUE OF WEALTHY ELITIST BACKERS  WANT TO TAKE THEIR SOCIAL SECURITY PENSIONS AWAY
 
* OBAMA ECONOMIC ADVISER DAVID CUTLER ARGUES THAT HIGH HEALTH CARE COSTS ARE ECONOMICALLY DESIRABLE
 
Another Obama adviser who targets health care is David Cutler, a Harvard economist. Cutler wrote an article for the New England Journal of Medicine in 2006 asserting that "The rising cost ... of health care has been the source of a lot of saber rattling in the media and the public square, without anyone seriously analyzing the benefits gained."
 
Cutler advocates improving healthcare through financial incentives, meaning that he wants to increase cash flow into the hands of rapacious pharmaceutical and insurance companies.
 
* OBAMA'S TOP ECONOMICS GURU: AUSTAN "THE GHOUL" GOOLSBEE ­ SKULL AND BONES ALUM,
FRIEDMANITE CHICAGO BOY, FANATICAL FREE TRADE GLOBALIZER
 
 
Barack Obama's top economics adviser is a member of the super-secret Skull & Bones society of Yale University (Class of 1991), of which George H.W. Bush, George W. Bush, and failed elitist John Kerry are also members. Goolsbee is widely reported to have told Obama not to back a compulsory freeze on home mortgage foreclosures to help the struggling middle class in the current depression crisis, as demanded by former candidate John Edwards. Hillary Clinton has advocated a one-year voluntary freeze on foreclosures. Obama has offered counselors to comfort mortgage victims as they are dispossessed, citing the "moral hazard" of protecting the public interest from Wall Street sharks.
 
George Will, in an October 2007 Washington Post column saluted Goolsbee's "nuanced understanding" of traditional Democratic issues like globalization and income inequality; he "seems to be the sort of fellow -- amiable, empirical, and reasonable--you would want at the elbow of a Democratic president, if such there must be," wrote the arch-oligarchical apologist Will.
 
Austan Goolsbee (Obama's likely Secretary of the Treasury): "I'm a University of Chicago economist and no one is ever going to be more in favor of open markets and free trade than an economist, so you would presume I'd be for anything that has the words 'free trade agreement' in it and all I'll tell you is this: I do believe there's no one more in favor of open markets than me . . ."
 
As one reactionary Yale alum gushed: ". . .voters who usually lean Republican should take a second look at Obama ... Although some of his centrist economic prescriptions may disenchant liberals who distrust the benefits of globalization, Goolsbee said economic data indicate that free trade leads to higher wages."Goolsbee is almost certainly the unnamed advisor Paul Krugman refers to when he scores Obama's stimulus plan as "disreputable". Goolsbee is a bitter opponent of a single-payer system, and has attacked Michael Moore's movie Sicko on this issue.
 
Krugman: "The Obama campaign's initial response to the latest wave of bad economic news was, I'm sorry to say, disreputable: Mr. Obama's top economic adviser claimed that the long-term tax-cut plan the candidate announced months ago is just what we need to keep the slump from "morphing into a drastic decline in consumer spending." Hmm: claiming that the candidate is all-seeing, and that a tax cut originally proposed for other reasons is also a recession-fighting measure - doesn't that sound familiar?...Mr. Obama came out with a real stimulus plan. As was the case with his health care plan, which fell short of universal coverage, his stimulus proposal is similar to those of the other Democratic candidates, but tilted to the right. " (NYT, Jan. 14, 2008)
 
DON'T BE FOOLED BY OBAMA'S SOARING RHETORIC ­ CHECK OUT HIS RIGHT-WING ADVISORS - STOP OBAMA IN THE POTOMAC PRIMARY ­ MARYLAND, VIRGINIA, AND DC ­ FEBRUARY 12

Article Reproduced From www.Rense.com

Highlighting and links to "The Chicago boys and the Chilean 'economic miracle'"
Were added by Gnostic Liberation Front.

 

 

The Chicago boys
and the Chilean 'economic miracle'



SUMMARY: So what was the record for the entire Pinochet regime? Between 1972 and 1987, the GNP per capita fell 6.4 percent. (13) In constant 1993 dollars, Chile's per capita GDP was over $3,600 in 1973. Even as late as 1993, however, this had recovered to only $3,170. (14) Only five Latin American countries did worse in per capita GDP during the Pinochet era (1974-1989). (15) And defenders of the Chicago plan call this an "economic miracle."

By
Steve Kangas


Many people have often wondered what it would be like to create a nation based solely on their political and economic beliefs. Imagine: no opposition, no political rivals, no compromise of morals. Only a "benevolent dictator," if you will, setting up society according to your ideals.

The Chicago School of Economics got that chance for 16 years in Chile, under near-laboratory conditions. Between 1973 and 1989, a government team of economists trained at the University of Chicago dismantled or decentralized the Chilean state as far as was humanly possible. Their program included privatizing welfare and social programs, deregulating the market, liberalizing trade, rolling back trade unions, and rewriting its constitution and laws. And they did all this in the absence of the far-right's most hated institution: democracy.

The results were exactly what liberals predicted. Chile's economy became more unstable than any other in Latin America, alternately experiencing deep plunges and soaring growth. Once all this erratic behavior was averaged out, however, Chile's growth during this 16-year period was one of the slowest of any Latin American country. Worse, income inequality grew severe. The majority of workers actually earned less in 1989 than in 1973 (after adjusting for inflation), while the incomes of the rich skyrocketed. In the absence of market regulations, Chile also became one of the most polluted countries in Latin America. And Chile's lack of democracy was only possible by suppressing political opposition and labor unions under a reign of terror and widespread human rights abuses.

Conservatives have developed an apologist literature defending Chile as a huge success story. In 1982, Milton Friedman enthusiastically praised General Pinochet (the Chilean dictator) because he "has supported a fully free-market economy as a matter of principle. Chile is an economic miracle." (1) However, the statistics below show this to be untrue. Chile is a tragic failure of right-wing economics, and its people are still paying the price for it today.

 

The history of Chile and the "Chicago boys"

Unfortunately, Chile has been the site of revolution and experimentation for over 30 years now. From 1964 to 1970, President Eduardo Frei led a "revolution in liberty." From 1970 to 1973, Salvadore Allende embarked on a "Chilean road to socialism." From 1973 to 1989, General Augusto Pinochet and his military regime conducted a "silent revolution" (so-called because the free market quietly brought about drastic social change). After 1990, Chile has returned to democracy, but it will be a long time recovering from its experiments.

Chile's main export to the world is copper, and the United States has long held a keen interest in it. By the 1960s, U.S. companies had invested so heavily in Chile's copper mines that they owned most of them. When the conservative reformer Eduardo Frei became president in 1964, he attempted to nationalize the copper mines, but to no avail — he met stiff resistance from the business community.

In 1970, Salvadore Allende became the first Marxist to be democratically elected president in the Western hemisphere. In the course of his sweeping socialist reforms, he nationalized not only the copper mines but banks and other foreign-owned assets as well. Along with the redistribution of land under land reform, these actions deeply antagonized Chile's business community and right wing. It is now a matter of historical record that the CIA helped organize their opposition to Allende. A massive campaign of strikes, social unrest and other political subversion followed. In September 1973, the CIA helped General Pinochet launch a military coup in which Allende was killed. The Pinochet government claimed he committed suicide; his supporters claimed he was murdered.

The new government immediately began privatizing the businesses that Allende had seized, as well as reversing his other socialist reforms. But Pinochet did not have an economic plan of his own, and by 1975 inflation would run as high as 341 percent. Into this crisis stepped a group of economists known as "the Chicago boys."

The Chicago boys were a group of 30 Chileans who had studied economics at the University of Chicago between 1955 and 1963. During the course of their postgraduate studies they had become disciples of Milton Friedman, and had returned to Chile completely indoctrinated in free market theory. By the end of 1974, they had risen to positions of power in the Pinochet regime, controlling most of its offices for economic planning.

The arrangement was a new one in the history of governments. Although Pinochet was a dictator, he turned the economy over to the Chicago boys, and his only role was to suppress political and labor opposition to their policies. This arrangement was presented to the Chilean people as the removal of politicians and politics from the nation's affairs. Instead, technocrats with Ph.D.'s would run the economy according to the best theory available. Those theories, of course, were the "neoliberal" theories of Milton Friedman. Rational science would decide policy — not political slogans and muddled democracy.

In March 1975, the Chicago boys held an economic seminar that received national media attention. Here they proposed a radical austerity program — "shock treatment," they called it — to solve Chile's economic woes. They invited some of the world's top economists to speak at the conference, among them Chicago professors Milton Friedman and Arnold Harberger. Unsurprisingly, they gave the proposal their highest praise. The plan called for a drastic reduction in the money supply and government spending, the privatization of government services, massive deregulation of the market, and the liberalization of international trade.

This was not solely the Chicago boys' plan. It was also formulated by the International Monetary Fund and the World Bank, who made the program a precondition for future loans to Chile. The IMF and World Bank would make similar conditions of other developing nations around the world, but none would implement their program as thoroughly and completely as Chile. Interestingly, the World Bank now holds Chile up as an example to be emulated by the rest of the Third World. Considering Chile's huge debt and interest payments to the World Bank, it is not difficult to see why. The debt, devastation, inequality and exploitation that the IMF and World Bank bring to Third World countries in the name of "neoliberal development" is another story in itself. Brazil and Peru are two other notable examples — but Chile remains the worst.

Shortly after the 1975 conference, the Chilean government initiated the Economic Recovery Program (ERP). The first phase of shock therapy was reducing the money supply and government spending, which succeeded in cutting inflation to acceptable levels. However, it also caused unemployment to rise from 9.1 to 18.7 percent between 1974 and 1975, a figure on par with the U.S. Great Depression. Output fell 12.9 percent — making this Chile's worst recession since the 1930s. (2)

Meanwhile, to prevent the political consequences of such a shock, the Pinochet regime began cracking down on potential opposition leaders. Many just "disappeared." The human rights violations of the Pinochet regime will be reviewed below, but, suffice to say, workers "accepted" this austerity program at gunpoint.

By mid-1976, the economy began recovering, and from 1978 to 1981 it achieved what the Chicago boys called the "Economic Miracle." During this period the economy grew 6.6 percent a year. (By comparison, the U.S. economy usually grows 2.5 percent a year.) The Chicago boys lifted nearly all restrictions on foreign direct investment, creating an "almost irresistible package of guarantees for the foreign investor" with "extraordinarily permissive" treatment. (3) Foreign investment and loans came pouring into Chile, with loans alone tripling between 1977 and 1981. (4) Of the 507 state enterprises set up before or during Allende's presidency, the Chicago boys would eliminate or privatize all but 27. (5)

Defenders of the Chile experiment point to the "Economic Miracle" as proof that it worked. But here we should remember an important economic rule of thumb: the deeper the recession, the steeper the recovery. Quite often the recovery only gets an economy back to where it was before. Perhaps the clearest example of this is the U.S. Great Depression. Note the giant loss and growth numbers:

Changes in U.S. Gross National Product, by President
Year % Change in GNP President
1930 -9.4% Hoover
1931 - 8.5 Hoover
1932 -13.4 Hoover
1933 - 2.1 Hoover/Roosevelt
1934 + 7.7 Roosevelt
1935 + 8.1 Roosevelt
1936 +14.1 Roosevelt
1937 + 5.0 Roosevelt
1938 - 4.5 Roosevelt
1939 + 7.9 Roosevelt

The economy grew an astonishing 14 percent in 1936 — the strongest peacetime year in U.S. history. But does that mean that people were enjoying champagne and caviar during the Great Depression? Of course not. The economy was simply making up lost ground. Likewise, the U.S. recessions of 1980-82 were the worst since the Great Depression, and these were followed by an unusually strong seven-year boom: the so-called "Reagan years."

What's going on here? Two economic concepts are useful to understand this phenomenon. The first is that the economy grows in the long run, as both the population expands and each worker produces more per hour, thanks to improving technology and efficiency. This long-term growth experiences mild swings in the form of recessions and recoveries, of course. But if the economy grows in the long run, then deep recessions are going to be followed by even steeper recoveries.

The second concept is the distinction between actual productivity and potential productivity. "Potential" is a somewhat misleading term, since it implies something imaginary, but this productivity does indeed exist. Potential productivity reflects our nation's productive capacity (in the form of our workers, factories, etc.). Actual productivity reflects how much of that capacity is actually being used. For example, a factory may have the potential to turn out 3,000 cars a month. During a recession, however, its actual productivity may fall to only 1,500 cars a month. Actual growth would occur if the factory returned to a full capacity of 3,000 cars. Potential growth would occur only if a second factory were built.

During a recession, actual productivity drops as millions of workers are laid off and factories sit idle. But all the potential productivity is still there. During a recovery, actual productivity climbs closer to its potential, as millions of laid-off workers return to empty factories. This gives the appearance of growth — and we should note that this type of growth is relatively quick and easy to achieve. But what happens when all the workers have returned? Then any further growth will have to involve potential growth — that is, the construction of factories and the birth of new workers. As you might imagine, this type of growth is considerably more difficult to achieve.

So this is all that happened that during Chile's "Economic Miracle" — laid-off workers returned to their old jobs. When you take both the recession and recovery into account, Chile actually had the second worst rate of growth in Latin America between 1975 and 1980. Only Argentina did worse. (6)

And even then, much of Chile's growth was artificial or fictitious. Between 1977 and 1981, 80 percent of Chile's growth was in the unproductive sectors of the economy, like marketing and financial services. Much of this was speculation attracted to Chile's phenomenally high interest rates, which, at 51 percent in 1977, were the highest in the world. (7)

Chile's integration into the world market would leave it vulnerable to world market forces. The international recession that struck in 1982 hit Chile especially hard, harder than any other Latin American country. Not only did foreign capital and markets dry up, but Chile had to pay out stratospheric interest rates on its orgy of loans. Most analysts attribute the disaster both to external shocks and Chile's own deeply flawed economic policies. By 1983, Chile's economy was devastated, with unemployment soaring at one point to 34.6 percent — far worse than the U.S. Great Depression. Manufacturing production plunged 28 percent. (8) The country's biggest financial groups were in free fall, and would have collapsed completely without a massive bail-out by the state. (9) The Chicago boys resisted this measure until the situation became so critical they could not possibly avoid it.

The IMF offered loans to help Chile out of its desperate situation, but on strict conditions. Chile had to guarantee her entire foreign debt — an astounding sum of US$7.7 billion. The total bailout would cost 3 percent of Chile's GNP for each of three years. These costs were passed on to the taxpayers. It is interesting to note that when the economy was booming, profitable firms were privatized; when those firms failed, the costs of bailing them were socialized. In both cases, the rich were served. (10)

After the IMF loans came through, the Chilean economy began recovering in 1984. Again, it saw exceptionally high growth, averaging about 7.7 percent a year between 1986 and 1989. (11) But like the previous cycle, this was mostly due to actual growth, not potential growth. By 1989, the GDP per capita was still 6.1 percent below its 1981 level. (12)

So what was the record for the entire Pinochet regime? Between 1972 and 1987, the GNP per capita fell 6.4 percent. (13) In constant 1993 dollars, Chile's per capita GDP was over $3,600 in 1973. Even as late as 1993, however, this had recovered to only $3,170. (14) Only five Latin American countries did worse in per capita GDP during the Pinochet era (1974-1989). (15) And defenders of the Chicago plan call this an "economic miracle!"

Aggregate statistics are somewhat better. Between 1970 and 1989, Chile's total GDP grew a lackluster 1.8 to 2.0 percent a year. That was slower than most other Latin American countries, and slower than its own record in the 60s. (16)

With the economy booming in 1988, however, the government felt it safe to honor a requirement of its new constitution: a yes-no vote confirming the presidency of General Pinochet for another eight years. But the government's confidence turned out to be self-deluded, and Pinochet lost the vote. This called for another set of more open elections in 1989. The fragmented opposition united to defeat Pinochet, who was replaced by Patricio Aylwin, a moderate candidate from the Christian Democratic party. However, Pinochet remains as head of the military. Today democracy is restored in Chile, but a laissez-faire culture persists, and many social programs (like social security) remain privatized. Chile's economic course seems to have been permanently altered.



The deterioration of labor

Chile's erratic economy and ultimately slow growth are not the worst legacy of the Chicago boys. The standard of living for workers crumbled under the Pinochet regime. In fact, this is a truly horrific part of the story.

By all measures, the average worker was worse off in 1989 than in 1970. During this period, labor's share of the national income fell from 52.3 to 30.7 percent. (17) Even during the second boom (1984-89), wages continued to fall. The following index shows the decline in both average and minimum wages:

Evolution of real wages, revised index, 1980-87 (in percent) (18)
Year Average Wage Minimum Wage
1980 95.0% 97.7
1981 105.0 102.3
1982 110.3 101.2
1983 91.1 79.3
1984 86.5 69.5
1985 80.0 64.7
1986 81.5 60.3
1987 81.2 55.5

By 1989, Chile's poverty rate was 41.2 percent, one-third of them indigent or desperately poor. (19) Shanty towns known as poblaciones grew around Santiago and other major cities, kept alive by las comunes, or soup kitchens. In 1970, the daily diet of the poorest 40 percent of the population contained 2,019 calories. By 1980 this had fallen to 1,751, and by 1990 it was down to 1,629. (20) Furthermore, the percentage of Chileans without adequate housing increased from 27 to 40 percent between 1972 and 1988, despite the government's boast that the new economy would solve homelessness. (21)

Meanwhile, the wealthy were raking it in. The following chart shows how the richest 20 percent of society enlarged their share of the pie at the everyone else's expense. (Note: the "first quintile" represents the poorest 20 percent of society, the "fifth quintile" the richest 20 percent. The percentage numbers here represent the share of national goods consumed by that quintile.)

Consumption by Household Quintiles (percent distribution) (22)
Quintile 1970 1980 1989
First (poorest) 7.6% 5.2 4.4
Second 11.8 9.3 8.2
Third 15.6 13.6 12.7
Fourth 20.5 20.9 20.1
Fifth (richest) 44.5 51.0 54.6

Chile's income inequality also became the worst on the continent. In 1980, the richest 10 percent took in 36.5 percent of the national income. By 1989, this had risen to 46.8 percent. By contrast, the bottom 50 percent of income earners saw their share fall from 20.4 to 16.8 percent over the same period. (23)

Income was not the only thing that concentrated in the hands of the few; so did production. Once the Chicago boys deregulated the market, oligopolies rapidly formed in virtually every sector. The chart below shows how many large export firms controlled what percentage of their industry:

Concentration in the Export Sector by Main Industry, 1988 (24)
Industry # of firms Industry share
Paper, cellulose 2 90.0%
Chemicals 2 71.4
Wine and Beverage 2 70.2
Forest products 5 78.4
Food 6 67.3
Fish products 6 51.1
Mining 7 97.1
Wood 7 78.6
Agriculture 8 80.6

How did such extreme inequality come about? It was part of an intentional policy to keep unemployment as high as possible. (25) Widespread unemployment has the effect of driving down wages, as unemployed workers compete for a limited number of jobs, accepting even sub-poverty wages to get them. Many promoters of the "free market" forget — or probably exploit — the fact that the labor market is like any other market: dictated by the laws of supply and demand. To see how this works, imagine a land where the supply of workers perfectly matches the employers' demand for them, and everyone gets paid $10 an hour. What happens if we add a few more workers to this economy? Economist Paul Krugman explains:

  • "The way that a freely functioning labor market ensures that almost everyone who wants a job gets one is by allowing wages rates to fall, if necessary, to match supply to demand…" (26)

And the more unemployed workers we add to this economy, the more wages fall. An example of this correlation can be seen in the U.S. recession of 1982, when unemployment nearly hit 11 percent in the fourth quarter, and real hourly wages fell nearly 50 cents from three years before. The flip-side to this example is the 1980s "Massachusetts Miracle," when unemployment fell to a phenomenally low 2.7 percent, and McDonald's began offering twice the minimum wage ($7 an hour) trying to attract workers. (27)

In Chile, high unemployment was part of a deliberate policy, encouraged by the IMF and World Bank, to depress wages. During the crisis of 1975, the unemployment rate hit 18.7 percent. But even through the booms and busts that followed over the next ten years, the unemployment rate still averaged 15.7 percent. This was easily the worst in all Latin America. (28) The result of this policy was that wages fell, companies became more profitable, and inequality grew extreme. As might be guessed, such high unemployment also reduces a nation's productivity, which is largely why Chile's growth record compared so poorly to its neighbors.

How did the Chicago boys accomplish this war against workers without the people rising up in revolt? The answer lies in Pinochet's reign of terror.



Pinochet's crimes against humanity

From the very start of his rule, General Pinochet moved to suppress all opposition. He banned all other political parties, suspended labor unions, and cracked down on all dissidents to his regime. During his 16 years in power, his repressive apparatus executed at least 1,500 activists, exiled 15,000 others, and imprisoned, tortured, assassinated, or caused the "disappearance" of countless thousands more. (29) According to one human rights group, the Pinochet regime was responsible for 11,536 human rights violations between 1984 and 1988 alone. (30)

As time went on, however, Pinochet did a most unusual thing for a dictator: he dissolved his own regime. Not only did he give total control of the economy over to the Chicago boys, but he eventually returned a growing share of political freedom to the people as well. Once his totalitarian power was secure in the late 70s, he legalized labor unions and political parties once more, albeit under oppressive limitations and controls. And he agreed to a new constitution that would eventually require a plebiscite on his rule, and even democratic elections.

Does the fact that an oppressive military regime enabled the Chicago boys' to carry out their experiments somehow invalidate their results? Not according to Milton Friedman:

  • "I have nothing good to say about the political regime that Pinochet imposed. It was a terrible political regime. The real miracle of Chile is not how well it has done economically; the real miracle of Chile is that a military junta was willing to go against its principles and support a free-market regime designed by principled believers in a free market. The results were spectacular. Inflation came down sharply. After a transitory period of recession and low output that is unavoidable in the course of reversing a strong inflation, output started to expand, and ever since, the Chilean economy has performed better than any other South American economy.

    "In Chile, the drive for political freedom, that was generated by economic freedom and the resulting economic success, ultimately resulted in a referendum that introduced political democracy. Now, at long last, Chile has all three things: political freedom, human freedom and economic freedom. Chile will continue to be an interesting experiment to watch to see whether it can keep all three or whether, now that it has political freedom, that political freedom will tend to be used to destroy or reduce economic freedom." (31)

However, Friedman is pessimistic that Chile's economic freedom can last under democracy. He notes elsewhere that "while economic freedom facilitates political freedom, political freedom, once established, has a tendency to destroy economic freedom." By Friedman's lights, democracy should kill Chile's free-market reforms. One gets the impression Friedman would consider the experiment an unqualified success had the regime never existed.

It is interesting to note, however, that the anti-labor reforms enacted by the Chicago boys would have never been tolerated in a democracy (and in fact weren't, when the time came). The suppression of opposition to the Chicago program thus allows us to see how it would work in an uncompromised form.



Deregulation and pollution

Chile is a country of 15 million people, but 5 million of them live in Santiago, its capital city. Chile's free market means there is a distinct lack of anti-pollution laws, either for industry or commuters. And as a result, Santiago has become desperately polluted. In 1992, Santiago had the fifth worst air pollution of any city in the world, with levels three to four times higher than the upper limits recommended by the World Health Organization. (32)

Part of Santiago's problem is that it is ringed by mountains, so air pollution gets trapped in the city. However, that's all the more reason why public officials should have recognized the folly of indiscriminate polluting and passed the needed pro-environmental laws a long time ago.

Some 150 industries in Santiago emit 100 times the pollution recommended by particulate norms. Only 30 percent of the city's 600,000 cars have catalytic converters. Due to a lack of public works programs (and an equal lack of business interest), the city has nearly 600 miles of dusty, unpaved roads. The result is a thick, purplish smog that literally chokes the city. (33)

The cost has been horrendous, translated into unusually high mortality and sickness rates for Latin America. Santiago hospitals are swamped with over 2,700 infants a day brought in needing oxygen masks. Chile's College of Physicians has the called the situation a crisis, and authorities have set up a system of "pre-emergency" and "emergency" alerts. In a typical pre-emergency alert, authorities restrict traffic, physical exercise and industrial activity. The World Bank estimates that Santiago's current pre-emergency level is 18 percent more deadly than states of alert in Los Angeles and Europe. But until very recently, Chile's government has been unwilling to enact any serious pro-environmental legislation. In 1996, Dr. Ricardo Tulane quit the College of Physician's environmental committee in protest, accusing the government of doing too little to meet the crisis. (34)

The Chilean journal Apsi reports:

  • "The liquid that emerges from the millions of faucets in the homes and alleys of Santiago have levels of copper, iron, magnesium and lead which exceed by many times the maximum tolerable norms. [The lands that] supply the fruits and vegetables of the Metropolitan Region are irrigated with waters that exceed by 1000 times the maximum quantity of coliforms acceptable. [This is why Santiago] has levels of hepatitis, typhoid, and parasites which are not seen in any other part of the continent." (35)

The problem is not limited to Santiago. Half the country has become a desert under misguided industrial and environmental policies. A study by the Central Bank of Chile estimates that by the year 2025, Chile's native forests will have disappeared at current rates of extraction. (36) The Bank also reports that out of nine fish stocks off the Chilean coast, only one (sardines) has increased between 1985 and 1993. Five are in dramatic decline, having fallen between 30 and 96 percent. (37)

Chicago economist Ronald Coase, you may recall, won a Nobel prize for a theorem explaining how markets can resolve externalities like pollution. Chile — the Chicago boys' own experiment — strongly suggests otherwise.



Chile's privatized pensions

One of the most trumpeted "successes" of Chile's economic miracle is the privatization of its public social security system. It's most vocal supporter is Chilean economist José Piñera, who was once Pinochet's Minister of Labor, and therefore one of the most hated men in Chile. Today he is an international salesman of sorts, selling other nations on the idea of Chile's retirement program. Journalist Fred Solowey writes:

  • "In his speeches and articles, Piñera credits the Chilean pension model with producing just about everything short of the second coming of Christ: pensions that are 40-50 percent higher than under Social Security; security for the old; lower costs due to the 'fact' that the private sector is much more efficient than the public; a rate of savings rivaling that in an Asian 'tiger' economy; and even the end of class conflict in Chile." (38)

Piñera is co-chairman of a $2 million war being waged against U.S. Social Security by the Cato Institute. Their goal is to privatize the program along Chilean lines. Converts to their cause include Newt Gingerich, and, apparently, Time magazine. In a cover story entitled "The Case for Killing Social Security," Time included a sidebar on "How Chile Got it Right." (39) The operative word here is right, as in right-wing — Time's article quotes all the usual conservative think tanks, but not a single dissenting voice.

The Chilean retirement system is only a success to those companies who are pulling down outrageous profits from it. For the working people of Chile, it is a disaster in the making. According to SAFP, the government agency which regulates the private pensions, 96 percent of the known work force were enrolled in the private pensions as of February, 1995, but 43.4 percent of the account owners were not adding to their funds. Perhaps as many as 60 percent do not contribute regularly. Given the rising poverty in Chile, it is not difficult to understand why. Unfortunately, regular contributions are necessary to receive full benefits.

By 1988, about one fourth of Chilean workers were contributing enough to make the program's minimum benefits: $1.25 a day! (40) Critics charge that only 20 percent of the contributors will actually receive good pensions.

Worse, much of the plan's supposedly higher benefits are projected from the surging economic growth rates of the late 80s. But this growth followed a deep economic depression in 1983, and was bound to be high for many years following. Now that actual growth has caught up to potential growth, the Chilean economy is slowing down. The pensions are therefore not going to be as profitable as their cheerleaders claim.

When the current system was created in the early 80s, the government gave the people their choice: stay in the public program, or start contributing to private pensions. Over 90 percent of the people switched over to the private plan. This was carried out, however, under a mixture of threats, coercion and short term incentives. Many employers simply switched their employees' plans for them. The cash-starved public also received short-term pay increases by switching to private pensions, whereas the cost of the public programs went up for those who stayed in them.

"With the information I now have," says Cecilia Prado, a 17-year public employee, "I never would have switched. Under a democratic government they never could have imposed it on us. And if they ever passed a law allowing people to go back, there would be a great exodus." (41)

What many defenders of Chile's current program do not reveal is that under the old public plan, workers received not only pensions, but health care, low-interest housing loans from pension funds, and many other benefits. And that program covered 75 percent of all Chileans. When the private pensions went into effect, all these other services were dropped. As a result, Chile's "welfare pensions" for the desperately needy quickly rose 400 percent — up to the legal limit.

It is also extremely telling that when Pinochet introduced the program, his army and police were allowed to keep their own generous public plans. The private plans that were suitable for the masses apparently weren't good enough for those in charge of the country.

There are many more aspects to this unfolding disaster, but to chronicle them all here is impossible. Suffice to say, selling Chile's "success" to America is the ultimate con job.



Conclusion

A common defense of the Chicago experiment is that Chile's "prosperity [was] was born of pain." (42) However, the pain continues even today. Although Chile's economy is growing at a healthy pace today, it still lags behind most of Latin America. Much of the development is environmentally unsustainable. Inequality and poverty remain extreme. Furthermore, much of the country's industry is now foreign-owned — meaning that profits do not stay in Chile, but are shipped to other countries. Chile continues to have one of the highest foreign debts in the world, and therefore continues to serve as the poster child for the IMF and World Bank. In the U.S., Chile is on the fast track to becoming the fourth member of NAFTA — for motives one might easily guess.

Another defense of the Chicago experiment is that the conditions were not right, thus its apparent failure. Most objectionable is Pinochet's oppressive military regime. But it is unclear how his political policies would have adversely affected the Chicago boy's economic policies -- if anything, he allowed them to carry their plans out. If unregulated capitalist markets can only be imposed on workers by terror, then this is an argument that we should look for other, more humane economic alternatives.

A third defense is that the experiment was not a failure at all, but a rousing success. Usually these sort of apologetics are based on manipulative interpretations of the business cycle. The most common is to look to the incredible booms of the late 70s and late 80s — while ignoring the events responsible for them, namely, the deep depressions that happened prior.

At present, democracy seems to have reversed the tide of market tyranny, although big business still has undue influence with the government. The restoration of public life in Chile, therefore, will probably be a long, slow and agonizing struggle.

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Endnotes:


1. Newsweek, January, 1982

2. Jose Arellano, Politicas Sociales y Desarrollo: Chile, 1924-1984 (Santiago: CIEPLAN, 1988), p. 19.

3. Business Latin America, March 30, 1977, p. 103.

4. Andres Sanfuentes, "Los Grupos Economicos: Control y Politicas," Coleccion Estudios CIEPLAN no. 15, (Santiago: CIEPLAN, December 1984), p. 119.

5. Fernando Dahse, Mapa de la Extrema Riqueza (Santiago: Editorial Aconcagua, 1979), pp. 175-179.

6. James Petras and Fernando Ignacio Leiva with Henry Veltmeyer, Democracy and Poverty in Chile: The Limits to Electoral Politics (Boulder: Westview Press, 1994), p. 27.

7. Oscar Munoz, Chile y su Industrializacion (Santiago: CIEPLAN, 1986), p. 259.

8. Petras, p. 33.

9. Ibid., p. 29.

10. Ibid.

11. Juan Gabriel Valdes, Pinochet's Economists: The Chicago School in Chile (Cambridge, UK: Cambridge University Press, 1995), p. 265.

12. Ricardo Ffrench-Davis, The Impact of Global Recession and National Policies on Living Standards: Chile, 1973-87 (Santiago: CIEPLAN, 1988), pp. 13-33.

13. Cited in Noam Chomsky, Year 501 (South End Press, 1993), Chapter 7: "World Orders Old and New: Latin America Segment," 15/17. http://www.americas.org/archive/year/year-c07-s15.html

14. World Bank, World Tables 1995.

15. Ffrench-Davis.

16. Ibid.

17. Petras, p. 34.

18. Patricio Meller, "Revision del Proceso de Ajuste Chileno de Decada del 80," Coleccion Estudios CIEPLAN no. 30, (Santiago: CIEPLAN, 1990), p. 44.

19. Petras, p. 34.

20. Alvaro Diaz, El Capitalismo Chileno en Los 90: Creimiento Economico y Disigualdad Social (Santiago: Ediciones PAS, 1991), statistical appendix.

21. Excerpt from FoodFirst by Joseph Collins and John Lear. Chile's Free Market Miracle: A Second Look. http://www.web.net/comfront/miracle.htm.

22. Programa de Economia del Trabajo, Informe Anual (Santiago: PET, 1990), p. 192.

23. Diaz, pp. 58-9.

24. Analisis, no. 238, August 1-7, 198, p. 31.

25. Andres Sanfuentes, "Chile: Effects of the Adjustment Policies on the Agricultural and Forestry Sector," CEPAL Review no. 3 (Santiago: United Nations, December 1987), p. 123.

26. Paul Krugman, Peddling Prosperity (New York: W.W. Norton & Company, 1994) p. 124.

27. For average hourly real wages (Total private industry, 1982 dollars), see U.S. Bureau of Labor Statistics, Series ID: eeu00500049; for Massachusetts example, see Paul Krugman, p. 41.

28. Petras, p. 26.

29. Calculations by Chile's Commission of Human Rights, reported in Petras, p. 20.

30. Calculations by CODEPU (Comite Nacional de Defensa de los Derechos del Pueblo), reported in Fortin, September 23, 1988.

31. Milton Friedman, "Economic Freedom, Human Freedom, Political Freedom," Address at the Smith Center ­- A Conservative Think Tank at Cal State Hayward. November 1, 1991 http://www.sbe.csuhayward.edu/~sbesc/frlect.html.

32. WHO/UNEP (1992), World Bank (1992), other World Bank reports.

33. Andrea Mandel-Campbell, "Anger grows over Chilean capital's smog: Respiratory ailments rise," Miami Herald, Thursday, September 12, 1996.

34. Ibid.

35. Apsi, Chile, July 1990 (LANU, Sept. 1990).

36. Cited in Sara Larrain R., "Winning in the Global Economy: Chile's Dark Victory," PCDForum Column #79, The People-Development Centered Forum, June 1, 1996.

37. A copy of the Central Bank report was leaked to the Santiago newspaper La Nacion and published in the Latin American Weekly Report, September 12, 1996.

38. Fred J. Solowey, "Retiring the Chilean myth: Privatized pensions bring social insecurity," Focus, November 5, 1996

39. Time, March 20, 1995.

40. Joseph Collins and John Lear, Chile's Free-Market Miracle (Food First Books, 1994).

41. Solowey.

42. Quoted in Petras, p. 22.

 

Article Reproduced From: http://www.rrojasdatabank.org

 

 


Obama’s economic advisers
 

January 9, 2008

http://louisproyect.wordpress.com/2008/01/09/obamas-economic-advisers/

 

Austan Goolsbee: U. of Chicago neoclassicist and “Sicko” critic

Another Obama adviser who targets health care is David Cutler

David Cutler: Harvard economist who believes
that high health costs are good for the economy

Jeffrey Liebman: another Harvard economist and
former Clinton adviser who favors privatizing social security

Last night I was on my stationary exercise bike watching early MSNBC news coverage of the New Hampshire primaries prior to vote totals being reported. The pundits were falling all over each other in praise of Barack Obama’s campaigning skills. I was especially struck by Tom Brokaw’s describing the Black candidate as “A thoroughbred who has broken away from the pack,” a perfect encapsulation of the idiotic horse race character of these elections.

Despite the intense rivalry between Obama and Hillary Clinton, they both are cut from the same mold, namely the Bill Clinton presidency. In his 2004 speech to the Democratic Party convention titled “The Audacity of Hope”, Obama adopted the bipartisan, centrist pose perfected by Hillary’s husband during his regime:

The pundits, the pundits like to slice-and-dice our country into Red States and Blue States; Red States for Republicans, Blue States for Democrats. But I’ve got news for them, too. We worship an “awesome God” in the Blue States, and we don’t like federal agents poking around in our libraries in the Red States.

Since Obama’s speeches are rather thin on substance, you have to extrapolate their meaning from sentences such as the following, which occurred in the same 2004 address:

Now, don’t get me wrong. The people I meet — in small towns and big cities, in diners and office parks — they don’t expect government to solve all their problems. They know they have to work hard to get ahead, and they want to. Go into the collar counties around Chicago, and people will tell you they don’t want their tax money wasted, by a welfare agency or by the Pentagon.

Since welfare was gutted long ago, we can only presume that this reference was meant to establish Obama’s belt-tightening fiscal outlook. Although it is not widely understood, Obama is pretty much committed to the neoclassical economics outlook of his home-town University of Chicago. Since becoming Senator, he has relied on the advice of a professor named Austan Goolsbee, who calls himself “a centrist, market economist” (Washington Times, July 16, 2007).

Goolsbee has been a columnist for Slate.com and the NY Times, as well as a standup comedian. His economics are not meant as a joke, as I understand it. His columns are written very much in the same vein as fellow U. of Chicago neoclassical economist Steven Levitt’s “Freakonomics,” examining everyday problems such as “Why you get stuck for hours at O’Hare.” Most are fairly uncontroversial except for the swipe he took at Michael Moore’s “Sicko”, whose single-payer recommendations violate his free market principles.

Another adviser with a particular interest in health care is David Cutler, a Harvard economist who was also an adviser to Bill Clinton–surprise, surprise. Cutler wrote an article for the New England Journal of Medicine in 2006 asserting that “The rising cost … of health care has been the source of a lot of saber rattling in the media and the public square, without anyone seriously analyzing the benefits gained.”

Anxious to show the good side of rising costs, Cutler and a group of other economists defend the idea that a powerful and profitable medical industry can serve as an engine of economic growth in the USA as the wretched Gina Kolata reported in the August 22, 2006 NY Times.

By 2030, predicts Robert W. Fogel, a Nobel laureate at the University of Chicago Graduate School of Business, about 25 percent of the G.D.P. will be spent on health care, making it ”the driving force in the economy,” just as railroads drove the economy at the start of the 20th century…

Other economists agree.

”We have to spend our money on something,” says Robert E. Hall, a Stanford University economist.

In a paper published in The Quarterly Journal of Economics, Dr. Hall and Charles I. Jones of the University of California, Berkeley, write: ”As we get older and richer, which is more valuable: a third car, yet another television, more clothing — or an extra year of life?”

David Cutler, an economist at Harvard, calculated the value of extra spending on medicine. ”Take a typical person aged 45,” he said. ”They will spend $30,000 more over their lifetime caring for cardiovascular disease than they would have spent in 1950. And they will live maybe three more years because of it.”

I guess this is why they call economics the dismal science. It should be noted in passing that the aforementioned Robert W. Fogel was the co-author with Stanley Engerman of “Time on the Cross”, a book that argued that slaves actually had it pretty good under the plantation system. His latest book is titled “The Escape from Hunger and Premature Death, 1700–2100: Europe, America, and the Third World” that posits a “technophysio evolution” that is filled with Panglossian enthusiasm about capitalism’s ability to bring prosperity to the developing world.

Another Harvard University adviser to Obama is Jeffrey Liebman, a Harvard economist who co-authored a paper on the feasibility of privatizing social security when he was an adviser to Bill Clinton. Apparently, the momentum toward adopting such a proposal was halted after the Monica Lewinsky affair put the president on the defensive. Liebman has co-authored a book on social security “reform” with Martin Feldstein, another Harvard economist who was–appropriately enough–the chairman of the Council of Economic Advisors under Ronald Reagan. In an article titled “The Rich, the Poor, and the Economists” that appeared in the January 2002 Monthly Review, Michael Yates notes the following:

Before he became Reagan’s chief economist, he [Feldstein] was an expert on the economics of social security. In published papers, he claimed to have empirically demonstrated that the social security system in the United States inhibited savings. Since savings are the source of capital investment, the implication of his research was that the social security system also reduced investment and thereby reduced the growth rate of the economy, since investment is the engine of economic growth.

Feldstein’s work fit nicely into the growing conservative movement which arose after the post World War Two boom came to an end in the early 1970s. The Keynesian economics that was gospel during my college years was giving way to a return to the pre-Keynesian theory that “freely” operating markets (free from the poison of government control and regulation) were the only solution to all economic problems. Led by the famous “Chicago Boys,” especially Milton Friedman, the anti-Keynesians carried the day in the economics profession and still do. No wonder, then, that when Ronald Reagan became president, he tapped Feldstein to chair the Council. For years, Reagan had been railing against social security from his General Electric radio pulpit. Now here was an economist who could lend professional credence to Reagan’s reactionary views. Social Security would be a tough nut to crack. It was an extremely popular program, run with great efficiency and effective in sharply reducing poverty among the elderly.

There was just one problem. Feldstein’s research was fatally flawed. Two staff economists at the Social Security Administration asked Feldstein for his supporting data. After three years of repeated requests, he sent the data to them. When they tried to use Feldstein’s numbers to replicate his results, however, they could not. They uncovered an error in the computer program Feldstein had used, and when they corrected the error, the results were exactly the opposite of Feldstein’s. That is to say, the social security system actually encouraged savings and, according to Feldstein’s cherished “free market” theory, facilitated capital formation and economic growth. (For more on this, see “‘Superstar’ Feldstein and His Little Mistake” in Dollars & Sense, Dec. 1980, pp. 1-2 and the citations therein.)

One imagines that the average primary voter in Iowa or New Hampshire has not even the slightest clue that Obama is carrying around such baggage. For most of them, the mantras of “change” and “hope” are supposed to be sufficient to earn their vote, at least that was what was expected in New Hampshire. In utter defiance of the media coronation of Obama, Hillary Clinton was the choice of the people in this miserable, economically stagnant New England state. The World Socialist Website, whose political insights are sometimes undermined by their boilerplate calls for building revolutionary parties (i.e., their own) has a rather astute explanation for Clinton’s victory:

The outcome of the Democratic primary suggests that Clinton benefited from a growing concern among working class voters over the state of the US economy. Clinton was the only candidate to raise the growing danger of recession in Saturday’s televised debate, and exit polls showed that the economy was the number one issue of those who turned out to vote, whether they cast a Democratic or a Republican ballot. A staggering 98 percent of those who voted in the Democratic primary said they were “very” or “somewhat” worried about the economy.

Clinton ran ahead of Obama in the working class industrial city of Manchester, New Hampshire’s largest, and there were significant class and economic distinctions between their voters. Clinton led Obama by sizeable margins among those with family incomes less than $100,000 a year, among union members, among those without college degrees, among those who felt that the state of the US economy is poor, and among those with children in the home. Her largest margin was among single working women.

Perhaps the most striking distinction between Clinton and Obama voters concerned feelings about their family’s economic futures. Those who said their families were “getting ahead” backed Obama by 48 to 31 percent. Those who said their families were “falling behind”—a much larger group—voted for Clinton by 43 to 33 percent.

Of course, they will eventually be disappointed in a Clinton presidency because her economic program and his are virtually identical. In considering the “differences” between the two, I am reminded of what Fred Halstead used to say when he was running for president on the Socialist Workers Party ticket exactly 40 years ago: “Whoever wins the election, the American people will end up the losers.”

Louis Proyect: The Unrepentant Marxist

 

 

 

BRZEZINSKI SEIZING CONTROL
OVER US POLICY

IN SLOW-MOTION CREEPING COUP


By Webster G. Tarpley

 

Washington DC, Feb. 23 -- Events of the past few days indicate that the Zbigniew Brzezinski faction of lunatic Russia haters have now won the upper hand inside the secret councils of the Anglo-American finance oligarchy, displacing the hitherto dominant George Shultz-neocon faction. Although George Bush and his cronies still occupy the White House, the policies that are being carried out are coming from the Brzezinski left CIA machine. Brzezinski has returned to public prominence in recent months due to his role as top establishment controller for the Obama campaign. But Brzezinski is not waiting for the outcome of the November elections to take over key parts of the US government. Brzezinski and his left CIA allies are already moving to assert their strategy, even as the neocons and their characteristic obsessions are moved to the back burner. The probability of an attack on Iran or Syria is declining, even as the danger of confrontation with Russia, China, and Pakistan – all much more dangerous targets to trifle with – increases exponentially.

1. KOSOVO: The independence of Kosovo has opened a new crisis front in Eastern Europe, with the potential for very nasty complications in regard to Russia. This is the essence of the Brzezinski anti-Russian policy. Kosovo independence is of course a flagrant violation of all existing norms of international law, most notably the Helsinki CSCE treaty of 1975 which finally put an end to World War II by declaring that all borders in Europe were to be considered final unless and until any changes had been agreed through mutual consultation of the interested parties. Since the Serbian government in Belgrade is vehemently opposed to Kosovo independence, the unilateral actions of the US, British, and NATO are the very essence of international anarchy. The new regime in Kosovo goes far beyond the usual kleptocracy of NATO puppets favored by Brzezinski and his circles. The new regime in Kosovo is essentially the terrorist KLA, an organization devoted to gun-running, drug-running, and trafficking in human slaves. The KLA is a Balkan version of Al Qaeda, and both are wholly owned creations of the CIA and British intelligence. With Kosovo independence, the US, British, and NATO stand ready to use armed force to defend the right of a terrorist gang to assert sovereignty over a segment of modern Europe. The criminal obscenity of this policy could hardly be greater, but for Brzezinski all methods are legitimate provided that they increase tension with Moscow, and in that respect Kosovo independence is already a glowing success.

2. US EMBASSY, BELGRADE: The attack on the US embassy in Belgrade, Serbia by gangs of drunken students is a classic Brzezinski operation. The tactic of having an incensed rent-a-mob of swarming adolescent patsies attack the US Embassy in order to gin up a crisis is one of Zbigniew’s signature specialties. During the time that Brzezinski was running the foreign policy of Trilateral puppet Jimmy Carter, there were bloody attacks on the US embassies in Pakistan and in Afghanistan, both countries that featured prominently in Brzezinski’s arc of crisis theory. Most famous of all was of course the attack on the US embassy in Teheran, Iran, which led to the taking of hostages and the huge international crisis which helped to doom the Carter administration to extinction at the polls. If US diplomats or State Department personnel are taken hostage anywhere in the world in the weeks and months to come, this must be attributed to Brzezinski.

3. SPACE WARFARE: The shooting down by the Pentagon of a US satellite over the Pacific is a very provocative military stunt designed to intimidate both Moscow and Beijing, who happened to be Brzezinski’s immediate targets. This reckless and irresponsible action has raised the specter of an uncontrolled arms race reaching into outer space.

4. SYRIA: Zbigniew Brzezinski himself, fresh from addressing a retreat of House Democrats in Williamsburg Virginia, is now in Syria at the head of a RAND Corporation delegation. The purpose of this mission should not be construed as peace in the Middle East, although some foolish observers may read it in that way. Brzezinski’s goal is immediately to lessen Russian influence in Syria, including the closing of certain naval facilities that the Russian navy has maintained in that country. In the longer run, Brzezinski would like to turn both Syria and Iran into components of the ring he means to forge around Russia for the purpose of the strategic encirclement of that rival superpower. Zbigniew’s argument against the neocons is, why attack Iran and Syria, when you can turn them into kamikaze stooges, play them against Russia, and get rid of all of them that way? Europe and China are destined to play similar anti-Russian roles in Brzezinski’s playbook.

5. BUSH IN AFRICA: President Bush may not know what he is doing on his current visit to five African countries, but Zbigniew Brzezinski knows exactly what the mission is. The Brzezinski policy is to foment destabilization and chaos in Africa under the auspices of the new United States African command (US-AFRICOM), all for the purpose of driving the Chinese out of Africa. As Zbigniew announced on November 30, 2007 in the Washington Post, he intends to cut off Chinese access to oil, other energy sources, and strategic raw materials on the African continent. Since the Anglo-Americans control the Persian Gulf by direct military occupation, this is tantamount to a policy of driving the Chinese in on Eastern Siberia. Brzezinski believes that if the Chinese cannot get their oil from Africa, they will be forced to attempt the military seizure of Russia’s oil wells in the Far East, where there is much oil and very few Russians. Both Moscow and Beijing know exactly what Brzezinski is doing in this regard. This is the kind of harebrained scheming by Lord Astor, Lady Astor and Sir Neville Chamberlain which helped to bring about World War II. The idea then was to play Hitler against Stalin and get rid of both of them that way. When that blew up in the faces of the British, the result was World War II. This time, it may well be thermonuclear World War III.

6. CIA UNILATERAL KILLINGS IN PAKISTAN: Back in July 2007, Obama attracted much unfavorable attention when he announced his plan to bomb targets inside Pakistan without reference to the government of that country. He was vigorously criticized by Bush, McCain, and Mrs. Clinton. Obama turned out to be a bigger warmonger than Bush himself, since the tenant of the White House said that it was absolutely essential to work with the government of Pakistan against terrorism, and not humiliate them unnecessarily. Now it turns out that Obama’s puppet master Zbigniew Brzezinski is more powerful than Bush on this issue. The Washington Post of Tuesday, February 19 revealed that a CIA Predator drone aircraft had attacked the Pakistani town of Mir Ali, killing a certain Abu Laith al-Libi, supposedly a leading figure of the al Qaeda patsy organization. The big news was that this time around, the CIA had not sought approval from the government of Pakistan. President Musharraf, weakened by the CIA destabilization of his country that is now ongoing, was only notified of the operation once it was underway, meaning that he was not even consulted in advance. Thus, the aggressive policy put into Obama’s mouth by Zbigniew Brzezinski has become operational US policy, regardless of what the lame-duck Bush had to say about this issue last summer. Pakistan is now being targeted because of President Musharraf’s strategic understanding with China. Brzezinski intends to strip the Chinese of all their traditional allies as part of his campaign to smash the Shanghai Cooperation Organization and any other foci of resistance inside Eurasia against Anglo-American imperialism.

7. FALL OF ITALIAN GOVERNMENT: The European government most friendly to Russia and most reluctant to follow Brzezinski’s lead into confrontation was the Italian regime of Romano Prodi. Italy had launched a program of large-scale economic cooperation with Moscow, much of it mediated through the Italian oil company ENI, a perennial outsider and rival of the Anglo-American cartel. Underpinning the cooperation between Italy and Russia was a far-reaching rapprochement between the Vatican and the Russian Orthodox Church aiming at forms of ecumenical dialogue with obvious overtones of political and economic cooperation. This dialogue between the Roman Pope and the Russian Orthodox Patriarch is something Brzezinski abhors. A few weeks ago, Prodi was overthrown through the actions of a Quisling political faction centered on the Bank of Italy. The other European governments, most notably Mrs. Merkel in Germany, and Sarkozy in France, are currently in the pocket of the Anglo-Americans. The British regime of Gordon Brown has of course taken the lead in fomenting confrontation with Russia through such transparent provocations as the Litvinenko-Berezovsky affair and the recent flap about UK subversive activities in Russia conduited through the British Council, supposedly a cultural exchange organization, but in reality a very aggressive arm of MI-6, which is now being expelled from Russia. The policy being imposed by Brzezinski is by its origins a London policy.

POLICE STATE MOVES TO ELIMINATE OBAMA’S COMPETITION

The campaign of scandal revelations against Senator John McCain in the New York Times suggest that the banking establishment is determined to remove all obstacles that might impede the March of Brzezinski’s puppet Obama to the White House. In addition, Arizona Republican Congressman Rick Renzi, a McCain ally, has just been indicted on charges of extortion, wire fraud and money laundering in an alleged scheme to profit from a land deal. Renzi is an honorary co-chairman of McCain’s presidential campaign. At the same time, the controled corporate media continue to cover up the explosive revelations of Larry Sinclair, which have now been covered on numerous web sites and in the supermarket tabloid, The Globe. Since Karl Rove already knows all about these scandals, Democratic primary voters need to know about them too – otherwise they risk choosing a candidate so thoroughly compromised as to be unelectable.

Obama is an intrinsically weak candidate, who might well be defeated even by McCain in a normal election, especially given the overwhelming suspicion about Obama among Latino, Asian, and Catholic voters. The motivation of the New York Times smear campaign against McCain by his former admirers and backers is to eliminate any serious contenders who might hinder the new Messiah between now and November.

This is not the first time that the intelligence community-police state apparatus has had to intervene decisively to provide assistance to the faltering ambitions of their puppet, Obama. During his quest for a seat in the United States Senate from Illinois in 2004, Obama received a scandal boost not once but twice. Obama’s opponent in the Illinois Democratic senatorial primary of March 2004 was Marson Blair Hull, a wealthy securities broker who spent $28 million on television advertising and was heavily favored to defeat Obama in that primary. But Hull’s campaign was torpedoed by a barrage of well timed media charges that he had abused his former wife. Hull was therefore obliged to drop out of the race.

After Hull had been eliminated, Obama still had to face his Republican opponent in the November general election. Here his adversary was Jack Ryan, an investment banker from Goldman Sachs. Ryan had divorced his wife Jeri in 1999, and the case was sealed at their mutual request. Suddenly the Chicago Tribune and WLS television began undertaking mighty exertions to get these divorce records made public, even though they involved a dispute about child custody. On June 22, 2004, Los Angeles Superior Court judge Robert Schneider released the court documents in question. They revealed an accusation by Jeri Ryan against her husband, now Obama’s political competitor, to the effect that Jack Ryan had induced her to frequent sex clubs in a number of locations, and had attempted to coerce her into sexual intercourse in the presence of third parties. Judge Schnider’s decision was all the more extraordinary because it was made in the face of the direct opposition by both parties to the divorce, and bore on a Family Court matter that is normally kept vigorously secret. It was as if some totalitarian invisible hand were intervening in favor of the beleaguered Obama candidacy. At this point Jack Ryan was compelled to abandon his candidacy at the urging of Dennis Hastert, then Speaker of the House. By now the Illinois Democratic Party appeared to have gotten the message that Obama enjoyed divine protection, since they did not nominate a serious candidate to oppose him in the November election. Instead, they brought in a carpetbagger and well known windbag in the person of Allan Keyes of Maryland, who predictably went on to lose to Obama by the most lopsided margin in Illinois political history.

This process also recalls the 1988 elimination of top Democratic contender Gary Hart through a sex scandal. Hart’s prospective opponent was Bush the Elder, another intrinsically weak candidate favored by the CIA who needed police state assistance top make it to the White House. Gary Hart was knocked out of contention by a scandal involving Donna Rice, with whom Hart had been embroiled with the help of underworld figure Don Aronow, an ally of the Bush family. With US missiles about to be installed in Poland under the direct supervision of Ian Brzezinski, the Pentagon’s top man for Eastern Europe, the world is demonstrably moving towards a US – Russian superpower confrontation with unmistakable thermonuclear overtones. The one missing ingredient in this pattern is a suitable demagogue in the White House who can make an appeal for national mobilization in this crisis, including quite possibly a restoration of the military draft, planeloads of body bags, and a dimension of economic sacrifice and tax increases which Bush never proposed. This is the role of Zbigniew Brzezinski’s puppet and Manchurian candidate, Obama. The anointed one can still be prevented from carrying out the Brzezinski-Soros plan to seize the Democratic presidential nomination through the domestic equivalent of a color revolution or people power coup.

The dynasty we need to worry about at this point is neither the Clintons nor the Bushes. The main concern today is an extension of the Brzezinski dynasty. Zbigniew Brzezinski, founder of the Trilateral Commission, member of the Council on Foreign Relations, and RAND Corporation operative, personally selected Carter as president of the United States in the mid-1970s. The resulting 1977-1981 Brzezinski Trilateral administration was an unmitigated catastrophe, leading to two decades of severe political reaction from which this country has not recovered. Given the ongoing breakdown crisis of the Anglo-American banking and currency systems, another Brzezinski administration would pose the threat of thermonuclear war with Russia in an infinitely more acute form than in the 1970s. After a few months of Zbigniew Brzezinski running the show, the era of Bush and the neocons might begin to look like the good old days. It is still possible to avoid this nightmare by timely action.
 

 

 

THE OBAMA DECEPTION

 

Obama And Holocostianity
Baseless, Ignorant And Hateful

By Michael Hoffman
6-7-9

...Let's be real. Ending Israeli hegemony and being
genuinely fair to the Arab nation of peoples which
the Orthodox rabbis denominate as "Amalek,"
would require a revolutionary break with Holocaustianity,
the universal, de facto state religion of the Western world...

Obummer
by Edgar J. Steele
4-22-09
....I want to like Obama. 
In fact, I still do ... personally. 
After all, he is just so ... likeable. 
Problem is, things are happening on his watch
that continue to fracture America and, in fact,
seem to be accelerating her plunge into
the political, social and economic abyss....

Barack Obama - Crime Boss
By Stephen Lendman
4-18-9
...Since taking office, Obama, wittingly or otherwise,
has headed the largest criminal enterprise
in history - the mass looting of national wealth
to enrich his Wall Street benefactors.
He assembled a rogue economic team of
Clinton/Robert Rubin retreads - to fix the
current crisis they engineered...

Second Annual
State of the Revolution
A Report to the American People

by Edgar J. Steele
March 18, 2008
....Ok.  So President Obama didn't give
a State of the Union address this year. 
That doesn't mean I can't respond anyway
with the second annual edition of my take
on The State of the Revolution. 
Though this year's report contains tons
of new information,  I will, however, repeat
certain salient portions of last year's report....

Barack Obama - America's
First Jewish President

By James Petras
12-13-8
.....Think about it: Not only do the Zionists
and their embedded clones rule the White House,
they also have the political apparatus
(left, liberal, center and right) to silence, insult,
witch hunt and isolate any critic of their agenda,
their organizations and of the State of Israel.
When confronted by a critic the entire apparatus
brays in unison about 'anti-Semitism'
and follows up with severe civil sanctions...

Vogue Cover
Michelle Makes
the Hand Signal

Find out more about this Hand Signal...click picture
From www.Rense.com

The Last Shout
By Mike James in Germany
November 29, 2008
....America has just elected an avowed Marxist,
aligned with the principles of British Fabianism,
to be their president for at least the next four years.
McCain would have been no different;
for the Zionists and the State of Israel,
who control America, stacked their cards
to ensure for themselves
a satisfactory outcome either way....

 

Change you can believe in:
For the worse
Digging the Hole Deeper

by Dr. Diego Rodriguez
.......CUTTING OFF INCOME
There’s also been plenty of pressure
on the income (revenue) side:
“The U.S. economy fell into a recession last spring
and will contract sharply this quarter as more than
200,000 workers per month are added to the rolls
of the unemployed, a survey said on Monday. “....

 

OBAMA TRANCE
An Astrological Commentary
On The Birth Chart
Of Barack Obama

by Francis D. Grabau
11/12/08
"I serve as a blank screen,
on which people of vastly different political stripes
project their own views."
(Barack Obama; The Audacity Of Hope.)

 

The Israeli Who Will Run
the Obama White House

Written by Christopher Bollyn
06 November 2008

...Rahm Emanuel, who is named after a
Lehi (Stern Gang) terrorist named Rahamim Cohen,
and David Axelrod have been working together
since 1984 when they teamed up to help
Paul Simon (Mr. Bowtie) defeat Sen. Charles Percy (R-Ill.) 
These two Zionist extremists were not working for
reform in Illinois; their only agenda was to defeat
the incumbent Sen. Percy because of his senior position
on the Foreign Relations Committee
and his outspoken criticism of Israel...

Day One
Jim Kirwan
11-6-8
...The first twenty-four hours are now history,
and the first indications are that there are
surprises waiting for those that 'believed,'
perhaps too soon; in the literal application
of Obama's implied promises for real change
that already seems to be imperiled.
The message from around the world lies
in the hope that Obama will begin
to encourage peace and end the foreign
policies that have destabilized so much
of the world today. Here are some excerpts
from a round-table discussion
on Democracy Now this morning...

 

The Bankers 9/11
10-8-8
The US - now world - financial crisis
has given nations a golden opportunity,
 but will they seize it,
asks Eric Walberg

Grand Theft America
By Stephen Lendman
9-29-8
.....The result of unfettered capitalism's fatal flaw
 - unbridled greed in a rigged system that rewards
the few at the expense of most others.
First an explanation of how it works.
Free-wheeling, "free market" Chicago School
fundamentalism the way economist Milton Friedman
championed it in his 1962 book
"Capitalism and Freedom" and taught it
to students for decades....

NO To The Paulson-Bernanke
Derivatives Scam Bailout
Bail Out the American People,
Not Wall Street!

An Economic Recovery Strategy for Protectionists,
Dirigists, Mercantilists, and Populists

By Webster G. Tarpley
9-23-8

 

For more Obama
click picture below

 

Baracknophobia
by Edgar J. Steele
June 27, 2008  
Even the most ardent of Barack Obama's supporters
generally will confess to a small, nagging
(dare I say niggling?) doubt about the object of their ardor. 
Similarly, even Obama's most vocal opposition stops
and stares just a bit overlong when they see him speaking. 
What an odd situation.

Barack O’Bilderberg:
Picking the President

by Andrew G. Marshall
Global Research, June 9, 2008

 Race, class and the politics
of the Obama campaign

WSWS
By Patrick Martin
20 March 2008

Elitist Obama Broken
By Blue Collar Vote
In TX, OH, RI

By Webster G. Tarpley
3-11-8

The Old Guy Perspective
DEALING WITH IT.

Thursday, March 20, 2008
Obama says we should talk about race.
He thinks that will help him. It won't.
Most of us have spent a lifetime
absorbing the lesson that seeing
what we see automatically makes us racist.
Do you want to talk about it? Do you? Really?

FDR's `New Deal':
An Example of
American System Economics

by Hartmut Cramer

Draft Economic Recovery Program
To Stop The Bush Depression

By Webster Tarpley  
1-22-8

Henry Wallace Would Never
Have Dropped the Bomb on Japan

by Robert L. Baker

ON THE NON-NOMINATION OF 1944
The Geometry of the
Henry Wallace Nomination

by Lyndon H. LaRouche, Jr.
October 18, 2003

 

 

 

 

 


 

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