Thursday, October 23, 2008
Superstitiously, I voted already, hoping like many to take at least one dirty trick out of the Republican quiver by not suffering the long lines and electronically transmitted machine commands on election day. Also, in the event my name had been put on a no-vote list, I might have a shot at overturning the mistake by fast court action and still having time to vote in this election.
Looking at the Electoral College map, Obama has 364 electors to McCain’s 171, with 18 too close to call. 270 are needed to win. Eight states that went for Bush in 2004 are now in the Democratic column and three more are barely holding on (including Tennessee) and could easily tilt into the Obama camp in any given news cycle. Even solidly Republican turf has been moving to Obama in the final days, fed up with McCain’s recklessless, fecklessness, and nastiness. Take Tennessee, Kentucky, and North Carolina, for instance, which look like divining rods crossing. Yesterday I paid $2.67/gallon for gas at a local station, a woolly caterpillar sign of how desperate someone is getting for Republican votes. Wish I could fill up my 500-gal. reserve tank now, but it is already full.
Following the money, Obama is setting fundraising records and able to outspend his opponent four to one. The cash meter is also tipping to Democratic favor for House and Senate races and it looks now that there will be 57% and 59% Democratic seats, respectively, possibly more.
A bigger question is why, when speaking of the election, I have to keep knocking wood.
While it is not inconceivable that Obama will issue an omnibus pardon to his predecessor, after the example of Gerald Ford to Richard Nixon, it is less likely that such a pardon would be extended to the inner circle of Bush’s Bunker.
Letting the puppet go free while unleashing the Justice Department on the puppetmasters has to be a nightmare scenario waking some in that circle up at night. Apart from buying condos in Dubai, where extradition won’t reach (unless one resorts to extraordinary rendition), they really have few options.
Of course, one option is just to remain in power.
Stephen Lendman points out that most of the elements of the October Surprise, 2008 Edition, are falling into place. The Dow Average dropped 22% over eight trading sessions and comparable crashes rippled through exchanges all over the world. The 1019 point swing from low to high in one of those sessions was the biggest since the Dow was created in 1896. $8.4 trillion, at a minimum, was washed out of retirement savings and company worth, bringing commerce and lending to a near standstill and beggaring some of the world’s largest corporations. At the same time 10 million foreclosures hit the real estate sector, job layoffs mounted, and consumer confidence nosedived.
While we have yet to see runs on banks or empty grocery store shelves, troops are being pre-positioned to quell anticipated riots. On October 1st, the 3rd Infantry's 1st Brigade Combat Team was returned from Iraq to serve in this role. Emergency plans for coping with economic collapse (?) or election reversal (?) a la Calderon are being fleshed out in FEMA offices and Pentagon contractor circles. Sy Hersh says he is keeping his mouth shut and his fingers crossed.
Me too, except the shut mouth part.
Wednesday, October 22, 2008
This past Monday, Mr. Kunstler, who generates metaphors faster than a tennis practice machine pumps balls, came up with a humdinger. He said the financial crisis is hitting us the way a tsunami does. “The current disappearance of wealth in the form of debts repudiated, bets welshed on, contracts cancelled, and Lehman Brothers-style sob stories played out is like the withdrawal of the sea.” But in his rapid-fire metaphorization, there is an opportunity missed. Yes, the October Surprise financial crisis is the withdrawal of the sea, but the coming wave is not monetary inflation, as Kunstler would have it, but Peak Oil. Whether we get inflation, deflation, or both, what is coming is a tidal wave that will wash a long distance inshore, leaving nothing we would recognize as today’s city life in its wake.
Separately and simultaneously, Richard Heinberg compares the crisis to the Great Depression, and says that the government’s response should be informed by what worked then. Heinberg proposes a “New Green Deal.” Instead of propping up failing financial institutions, the new president must inject investment into the real economy by supporting wide-ranging but tightly coordinated projects to create far more renewable energy generation capacity, build railroads and public transport facilities, insulate millions of homes while providing alternative heat sources, and re-configure the national food system to dramatically reduce and soon eliminate the need for fossil fuels.
I’ll take that a step farther and remind readers that Franklin Roosevelt was also a little slow to adjust to what was required in the way of social programs, but, led by his wife, Eleanor, eventually did the right thing. In 1943 Eleanor Roosevelt started the Victory Garden movement and, by 1945, 20 million home gardens were supplying 40 percent of the produce consumed in this country. She did it over the strenuous objections of the Department of Agriculture.
The Department of Agriculture also opposed organic gardening for decades, until the oil crises of the 1970s, when, after its own scientists showed how competitive it could be and how it could get the US off imported oil, it became an advocate, sort of. The Reagan Revolution ended that. The Republicans killed it with a total purge of the Department and buried the evidence. USDA was even forbidden to use the word “organic” and had to come up with “Sustainable Agriculture” as a euphemism.
Today, in New York and Boston, there are allotment gardens for people without access to land. Those in New York City were started by Brad Will when he was working for the Sixth Street Community Center, before he went off to die in Oaxaca. As Michael Pollen observed recently, Victory Gardens offer a way to enlist Americans, in body as well as mind, in the work of feeding themselves and changing the food system — something more ennobling than merely asking people to shop green.
Another New Deal program that seems lost to history but could be revived is the Resettlement Administration, a U.S. federal agency that, between April 1935 and December 1936, relocated struggling urban and rural families to communities planned and built by the federal government.
The Resettlement Administration was originally under the United States Department of Agriculture as the Division of Subsistence Homesteads. It was folded into the Farm Security Administration from 1937 until 1942.
The Resettlement Administration worked with nearly 200 communities, each of several hundred homes, to help residents escape poverty; show that cooperative management can work, and as an experiment in cooperative ownership of the village, including the businesses, which experimented with microlending, peer management review, and other innovative practices. It was killed by the Republicans during the McCarthy witch hunt.
The intentional communities movement in the US began mostly after WWII by pacifists and war resisters who picked up where the Resettlement Administration left off. Today there are several hundred thriving intentional communities in the USA and many more in other parts of the world. From intentional communities sprang ecovillages, a movement that has more than a million residents worldwide today. These were the fruit of that brief experimental period of the 1930s, the sketchpad for the route to higher ground as the tsunami approaches.
Tuesday, October 14, 2008
Missouri was seen as a swing state at the start of this Presidential election year and thus in need of campaign attention, while Tennessee was seen as solid Republican (it even swung away from native son Al Gore, who had sited his 2000 campaign headquarters in Nashville). Since the state was securely red, there has been no urgent need to push down gas prices to get more votes.
Now that Tennessee is up for grabs, we are beginning to see lower prices like other swing states. We have been slowly moving down from $4 towards $3/gallon over the past three weeks, prices that swing states like Missouri, Indiana and Ohio have been enjoying much longer. Hurricane-smuricane. As I mentioned in this space on September 6th, better prices at the pump are good news for the incumbent party, and if you have some sway with the refineries, you can make that happen, as we have seen in many Bush-related campaign seasons over the past 20 years.
If you have some sway with the oil producers and futures traders, you can also make that happen to crude, which puts the squeeze on countries like Venezuela and Russia, as an added bonus.
Of course, as James Howard Kunstler observes: "We construct our narratives to try and explain circumstances that are unraveling non-linearly before us, and some narratives are more plausible than others, depending on your vantage point. There are infinite narratives."
In my narrative, some gas is better than no gas, but if temporarily low prices bring us back to thinking the bubble economy we enjoyed before is real, and is not imploding now, we are worse off. We need to take this pause in the hyperinflation cycle to equip for the future, which will be a future not just of expensive gas, but of no gas. To the left is another sign I saw this past week in a central part of the Ozarks.
Back at The Farm we are celebrating the hunter's moon and preparing for our harvest moon. The persimmons are being dried or jellied. The hyacinths are coming off the constructed wetlands and going into long compost windrows to make next Spring's potting soil. A new, sawdust pyrolysising masonry stove is going into the Inn's greenhouse, along with all the tropical plants that will overwinter there. Carl is building a sauna from cedar shakes and scrapwood. Jason is laying out the project for our photovoltaic design and installation workshop next month. Ellie and Jessi are boxing up things we won't need when the workshop season is over. My mind is full of ideas for new books, and the extra time for writing that winter brings.
It is a good time to husband resources, buy durables, and secure for inclement weather.
Monday, October 13, 2008
This is part of the run-up to our Financial Permaculture: The Greening of a Rural American Community on October 24-28th in Hohenwald, Tennessee.
During that immersion workshop, we will be going into the “invention room” for five days to develop business plans for a number of different businesses, including a green incubator and a small ethanol production business. There is a pretty amazing group of people coming to participate as both students and resident experts. The whole point of the exercise is to address how we build the financial bridges for transferring investment capital from global financial markets (which are staring into the abyss) to local investment (which is re-aligning to meet community and family needs more directly).
In this regard, I want to remind people of The Post-Petroleum Survival Guide, which could be retitled The Post-Financial Collapse Survival Guide now. The same 12-step program that is designed to end your addiction to oil also works to end your addiction to Wall Street ups and downs, conventional employment (one chapter is called "Quit Your Job") and dependence on government to save you when strange odors start emanating from your fan. I have set up a new link to handle the increase in orders for the book. I have now sold out of my author's supply, but if you order directly from New Society, I get a better royalty percentage than if you order from Amazon or another retail outlet.
If you are up at midnight next Thursday, I hope you will join us on the radio.
Tuesday, October 7, 2008
The item? The guttersnipe, John McCain, who has been trying to draw links between his opponent and the weather underground from the 1960s, it turns out served in the 1980s on the board of the Council for World Freedom, a quasi-military front used by Oliver North and the Reagan White House to subvert the will of Congress when legislators cut off funds for the illegal covert effort to overthrow the government of Nicaragua after a democratic election threw out their puppet dictator. It wasn't enough that the despot Sen. McCain wanted re-installed was a torturer trained by the U.S. military, the Council for World Freedom was linked to former Nazi collaborators and ultra-right-wing death squads throughout Central America. Caught in the glaring crosshairs of public exposure, McCain claimed that he resigned from that board in 1984 or maybe 1986. But then retired Army Maj. Gen. John Singlaub and Joyce Downey, who oversaw the group's day-to-day activities, said they hadn't heard of that before. McCain's office produced two letters from 1984 and 1986 to back his account.
Anastasio ("Tachito") Somoza Debayle was a West Point graduate, head of the National Guard, and President of Nicaragua from 1967 to 1979. He used that authority to hunt down, torture and kill many political rivals. He was the last member of the Somoza family to be President, ending a brutal and corrupt dynasty that had held power since 1936.
Lest we have forgotten, or maybe were not even born then, the notorius Iran-Contra affair involved funding of a group of Nicaraguan terrorists, assembled and equiped by the White House, to reverse the democratic election and re-install the military dictatorship of the Somoza family. The effort was defunded and made explicly illegal by Congress through the Boland Amendment but that did not deter Ronald Reagan and the people around him. Reagan tasked his Vice-President, George Bush, Sr., former Director of Central Intelligence, with seeing that the effort continued covertly, out of the view of Congress.
The Iran-Contra affair was unmasked when a Lebanese newspaper reported that the U.S. sold arms to Iran through Israel in exchange for the release of hostages by Hezbollah (as later verified by letters sent by Oliver North to John Poindexter -- now Director of the supersecret Bush/Cheney Information Awareness Office, aka "Eagle Eye"). The Israeli ambassador to the U.S. revealed that the reason weapons were eventually sold directly to Iran was to establish links with elements of the military in that country, although suspicion arose that it was a payback for Henry Kissinger's secret Iranian mission that prevented Jimmy Carter from negotiating the release of U.S. Embassy hostages and thus brought about the election of Ronald Reagan.
The Contras did not receive all of their finances from arms sales, but used clandestine CIA drug trafficking to purchase and equip both Iran and Iraq. While a congressional inquiry led by John Kerry exposed the contra-cocaine connection, it neglected to investigate the much larger CIA-led poppy trade in Afghanistan, which was subsequently eradicated by the Taliban during the Clinton years, but then re-established and enlarged following the (ill-fated?) U.S. invasion of Afghanistan in 2002.
Not that we are saying John McCain has anything to do with that, mind you.
Monday, October 6, 2008
Saturday, October 4, 2008
KATHLEEN HALL JAMIESON: When Gwen Ifill reframed the question asked by Jim Lehrer in the first debate: What would you change in your plans, given current economic circumstances? Both candidates, like the heads of the ticket in the last debate, punted. You had Joe Biden saying, "Well, we were going to double foreign aid, but maybe we won't do that as quickly as possible. And we won't do all those bad things John McCain is proposing. Well, of course not. If you're elected, you're not going to react to the other person's agenda.Hard to imagine going further into an economic mess than we already are, but get ready, from here on out, it’s all downhill. I recently told a radio interviewer to think of it like an avalanche. You turn downhill and ski as fast as you can. What I meant was, get out of the stock market, secure your food supply, water supply, look after your neighbors, and prepare for the worst.
And Governor Palin basically said we're not going to change anything. So we've now had two debates in which candidates have been asked a significant question. And Jim Lehrer followed up repeatedly in the first debate. That in changed financial circumstances, with an unprecedented deficit and debt, with the public deficit foreign-held, now about to increase over the huge level that it's already at, these four candidates, two presidential, two vice-presidential, don't have the courage to tell us that if elected, they will change their spending and taxing plans.
Even though I believe that if either is elected, he will. As a result, they're campaigning in a way that makes it harder for them to govern responsibility. And they're ensuring that when elected, the electorate's going to feel betrayed by being promised things that they're not going to deliver. But if they keep their promises, they're going to be financially irresponsible and drive this country further into an economic mess.
This past couple weeks, it seems like most people are doing exactly that.
On October 24-28, in our county seat of Hohenwald, Tennessee, we will bring together some of the pre-eminent post-apocalytic thinkers to begin work on a transition methodology we are calling Financial Permaculture.
The 5-day workshop, led by Catherine Austin Fitts, is designed to teach people to
- Map the financial ecosystem of a community
- Apply permaculture principles to business design
- Design, start and finance a regenerative business, and
- Create ecological and socially responsible investment opportunities.
Over the past year, thanks to a $50,000 USDA rural development grant that Global Village Institute and the Center for Holistic Ecology landed in 2007, we have been drawing together the threads of what “sustainability” might look like in the context of The Farm’s county seat, the old Swiss colony of Hohenwald (35.547 N, 87.551 W., pop. 3808, average violent crimes per year = 2).
Through a cautiously slow series of baby steps, we have gradually been sucking Transition Town Hohenwald into the viral meme of the emerging world made by hand. Our Local Economic Development and Green Education Initiative has been hosting public meetings, film screenings, presentations, and columns for the weekly newspaper. In July, we held an ecovillage design charrette with Diana Leafe Christian and Greg Ramsey to allow citizens the chance to re-envision what Hohenwald might look like if the giant tractor-trailer rigs filled with pine logs and appliances didn’t drive through the center of town every daylight hour and those barren and decaying storefronts, their business lost to the big box stores on either end of town, were back to selling groceries and hardware to pedestrian and bicycling walk-ins.
But lets stop a moment and consider the current financial firestorm. Step for a moment with me into the WayBack Machine and journey to those thrilling days of yesteryear, which seem so much like déjà vu all over again. I was in my 30s and arguing atomic veterans cases. Ronald Reagan was tearing the photovoltaic cells off the White House roof, launching Star Wars, and killing Jimmy Carter’s plan for energy independence.
The U.S. Savings and Loan crisis of the 1980s came from the failure of 747 savings and loan associations (S&Ls) in the United States, losing around $160.1 billion, about $124.6 billion of which was directly paid for by the U.S. taxpayer ($326 billion in 2008 dollars). The scandal was prompted by the activities of one particular bank, Lincoln Savings and Loan Association of Irvine, California, headed by Charles Keating, who ultimately served five years in prison.
John McCain and Charles Keating had become personal friends following their initial contacts in 1981. Between 1982 and 1987, McCain received $112,000 in political contributions from Keating and his associates. In addition, McCain's wife, Cindy, and her father Jim Hensley had invested $359,100 in a Keating shopping center. McCain, his family, and their baby-sitter had made nine trips at Keating's expense, often using Keating's jet, to Keating's opulent Bahamas retreat.
The “Keating Five” affair began when it was learned Keating made $1.3 million in political payoffs to five U.S. Senators, McCain included, in exchange for helping deflect regulators from Lincoln Savings. The regulators backed off, with disastrous consequences.
With the regulators off its back, Lincoln moved FDIC-insured accounts into commercial real estate ventures. By the end of 1986, the Federal Home Loan Bank Board had found that Lincoln had $135 million in unreported losses and had surpassed the regulated direct investments limit by $600 million. Undaunted, Keating appealed to President Reagan to make a recess appointment of a Keating ally, Atlanta real estate developer Lee H. Henkel Jr., to an open seat on the FHLBB, and that quelled the investigation for a while, until Henkel himself was caught up in the scandal and forced to resign.
In March 1987, with the investigation heating up, Keating and Senator Dennis DeConcini asked McCain to travel to San Francisco to meet with regulators regarding Lincoln Savings, but McCain refused. Keating called McCain a "wimp" behind his back, and on March 24, Keating and McCain had a heated, contentious meeting. After that they apparently kissed and made up, because on April 9 McCain attended a meeting with FHLBB regulators to discuss the government's investigation of Lincoln. The regulators felt that the meeting was very unusual and that they were being pressured by McCain and the other four Senators, and in May issued a report recommending that Lincoln be seized by the government due to unsound lending practices.
Because of Keating’s friends in high places, it took two years to close Lincoln down. More than 21,000 mostly elderly investors lost their life savings, about $285 million. The federal government was liable for $2 billion to cover Lincoln's losses when it seized the institution. A Senate Ethics Committee investigation criticized McCain for exercising "poor judgment." Time Magazine noted that the Committee had timed its report to coincide with the run-up to the Gulf War, minimizing its news impact.
In 1989, Catherine Austin Fitts was serving as Assistant Secretary of Housing. The housing bubble of the 1980’s had burst, and foreclosures were rising. John McCain had been caught with his hand in the S&L bribe till. The mortgage insurance funds of the Federal Housing Administration (FHA) were experiencing dramatic losses. HUD was losing $11 million a year in its single-family fund. All funds had lost $2 billion in the southwest region the year before. Fitts complained to her superiors that there was a lot of hanky-panky, but I’ll let you read that part of the story on her website.
As she looked into it more deeply, Catherine had a minor revelation. It you take away the Reagan/McCain lax regulation and fraud part, the single biggest cause of losses in the FHA portfolio was a falling Popsicle Index – an index Catherine and her staff coined to express the health of the living equity within a place.
The Popsicle Index is the percent of people who believe that a child can leave their home, go to the nearest place to buy a popsicle, and come home alone safely. It’s an expression of the sense of intimacy and well being in a place.Catherine says, “Not surprisingly, there is a correlation between the financial equity or wealth in a place and the living equity or human and natural wealth. Where the people, living things and land are happy, businesses thrive, and the value of real estate is good.— Catherine Austin Fitts
“It took many years of researching to realize what was going on in our financial systems to incentivize this behavior. In most areas of the world, places are organized by government and financed with debt.
“Corporations are financed with both debt and equity. The key financial opportunity is in owning the equity. When profits increase or the perception of a company prospects improve, the stock goes up. Senior management and investors sell the shares, generating capital gains. Capital gains on stocks and real estate are primary mechanisms for creating financial wealth in our society.
“As a result, corporations can make money exploiting people and places and their stock will go up. The ‘stock’ of the place harmed will not go down; there is no ‘stock’ of the place. By centralizing our investment capital into large corporations, our financial interests are not aligned with the interests of the people and our natural environment.
“So what do we do? If we are to stop the financial drain on our families and communities we must change how we manage our own finances. Perhaps the way to begin is as permaculture teaches us – to listen and build out from natural systems which are, ultimately, the source of most of our wealth.
“In every place, there are thousands of existing financial agreements, including laws and regulations that impact financial values. If we are to nurture and restore places, we are well served to listen to both natural systems and existing financial agreements, looking for ways of building new, fundamental alignments between land, people and their savings that reduce risk and optimize resources on an integrated basis.”
“Developing ways of creating sound investments to finance permaculture developments and the businesses that supply them would serve to spread the adoption of permaculture techniques. The more opportunities locally, or through decentralized networks, the easier it will be for people to withdraw their retirement savings from destructive systems.”
The idea of using the term Financial Permaculture to describe these efforts was coined by Thomas Hupp of the Leadership School as he, Jennifer Dauksha-English of the Center for Holistic Ecology, Greg Landua of the Ecovillage Training Center, Carolyn Betts of Solari and Catherine were brainstorming how to integrate the Solari investment strategy with the economic revitalization of Hohenwald.
Then they decided the best way to create an integrated vision of natural and financial health within a place was to invite many more people into the conversation.
For the past several months this group has been holding a series of public events in Hohenwald, getting gradually more specific, and, through that process, has teased out a few areas that most of the stakeholders can agree on. By “stakeholders” I mean county and city officials, private enterprise leaders, State agency representatives, and interested citizens of all backgrounds and predispositions.
From October 24-28, we will gather with participants and experts from across the country for a five day course and simulation — Financial Permaculture: The Greening of a Rural American Community. We will look at creating a new business such as alternative energy and fuel production. We will apply permaculture design to regional economic planning. Please join us. This is not intended just for Lewis County, Tennessee.
In her most recent Coast to Coast appearance, Catherine told George Noory that the $700 billion bailout bill was sending money in exactly the wrong direction. It was moving it from the real economy — people’s homes, small business enterprises, groceries, dental care and car loans — to the phony economy of pyramid schemes, fractional reserve debt finance, and loan derivatives. It was buying a pig in a poke — toxic paper — and it was using real peoples’ real life savings to do it. The antidote, Catherine said, was to reverse the flow. Run money out of the fake economy and into the real one; put it where it counts by making it easier to shelter your family, buy food, and get to and from work. Invest locally if you want to see your local economy thrive and the Popsicle Index rise.
The bailout bill may slow down the crash of global financial institutions, or it may not. What is certain is that people will still be around afterwards, and they will still have the same needs to be met. It is not enough just to outrun the avalanche. Once you get to safety, you have to start rebuilding. That starts closest to home.
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