Category Archives: Articles by others

The coup d’etat

Matt Tiabbi brings the thunder, as always:

The reality is that the worldwide economic meltdown and the bailout that followed were together a kind of revolution, a coup d’état. They cemented and formalized a political trend that has been snowballing for decades: the gradual takeover of the government by a small class of connected insiders, who used money to control elections, buy influence and systematically weaken financial regulations.

The crisis was the coup de grâce: Given virtually free rein over the economy, these same insiders first wrecked the financial world, then cunningly granted themselves nearly unlimited emergency powers to clean up their own mess. And so the gambling-addict leaders of companies like AIG end up not penniless and in jail, but with an Alien-style death grip on the Treasury and the Federal Reserve — “our partners in the government,” as Liddy put it with a shockingly casual matter-of-factness after the most recent bailout.

The mistake most people make in looking at the financial crisis is thinking of it in terms of money, a habit that might lead you to look at the unfolding mess as a huge bonus-killing downer for the Wall Street class. But if you look at it in purely Machiavellian terms, what you see is a colossal power grab that threatens to turn the federal government into a kind of giant Enron — a huge, impenetrable black box filled with self-dealing insiders whose scheme is the securing of individual profits at the expense of an ocean of unwitting involuntary shareholders, previously known as taxpayers.

Daily Telegraph fail

Warning: “Do nothing” wankfest ahead.

Via the Telegraph:

We need more risk and less regulation of the financial sector

Um, OK?

Capitalism is based on innovation.

Adam Smith rang.  He said “did you even READ my fucking book?”

But innovations are not always well understood when they first turn up. People buy too many of them and pay too much for them.

I just want to quote this as evidence the market does not always work perfectly and people are not rational consumers.  This will become important in a minute.

That is what happened in this crisis. People paid too much for financial products that they didn’t understand.

And sold them for too much.  And floated an entire economy on the basis they would keep selling forever and would never drop in price.  Oh, and there was something about lying to investors and firing people who disagreed with that assessment, using things like evidence and projected trends.  So not so much a naive mistake and more like carefully calculated get rich schemes.

Left to function alone, the market would have punished those that had invested in the companies that lost.

And everyone else, for good measure.  The market approves of collateral damage.

Companies going bust and investors losing their money are not a “failure of capitalism”.

Not even if they are making a yearly profit, yet go out of business due to a lack of credit during more quiet seasons?  Because that’s what is happening.

It is capitalism; and if you don’t like it, then you don’t like the system.

If you love Communism so much, why don’t you live there?

There was no need for the British government to bail out the banks last autumn.

Apart from that whole “turning into the next Somalia” thing, and everyone knows Somalia is a healthy and functioning market economy, with reported growth in such vital areas as piracy, terrorism, warlordism and mercenary work.

The wrong policy response – the one adopted – was to reward investor error.

Yeah, those silly investors, believing banking CEOs.  They should have beat them until they told them the truth about the risks they were taking!  Jack Bauer would do no less.

It saved the capitalists made rich at the expense of private capitalism.

If you hate that so much, why don’t you move to Cuba or something, Che?

Calls for heavy-handed regulation to restrict the actions of banks are the flip-side of acting so as to undermine the market’s means to punish poor decision-making.

Yeah, not allowing financially risky decisions with the threat of jail is totally not a punishment when compared to what The Market will do.

This means there will be less risk-taking in the economy as a whole – less innovation and experimentation, less diversity and dynamism.

I cite the Open Source Movement as proof people cannot innovate without a profit motive.

We will have an economy that grows more slowly and a society that is less tolerant, offering fewer opportunities for those who have no money but good ideas to get ahead.

Whereas a worldwide economic depression every couple of years won’t make people more intolerant or offer fewer opportunities at all.

The financial sector is unlikely to be able to return to sustained profitability without significant restructuring of a much more radical nature than the current favourites of creating “boring banks” and “bad banks”. Governments are now the major shareholders in these institutions, and they should insist upon their restructuring.

Typical commie, looking to the government to solve all your problems.

Imagine if, instead of all that, we had used £100 billion or £200 billion for tax cuts to stimulate the real economy.

Yeah, but imagine if we had used £300 billion to stimulate the Really Real Economy (for Realness).  Or £400 billion to titillate the Somewhat Less Empheral Economy.  Or, and I will admit we are pushing the boat out here, £500 billion for The One True Objective Economy That No Rational Person Can Deny?  What then, eh?  That’s the problem with you Commies, your lack of innovative thinking.

Ye gods, that was the biggest pile of fail I have ever read.

The potential for far-right terrorism in the USA

I’ve been kind of busy, and I don’t see that stopping anytime soon, so instead of doing a writeup myself, I’ll just direct you with links.

Orcinus has the details about the potential (and, in my view, likely) re-emergence of the “Patriot” militia movement:

One of the more disturbing trends we’ve been observing is the return of far-right “Patriot” rhetoric about government oppression with the election of President Obama. Fueled in no small part by mainstream right-wing talkers proclaiming we’re headed into “socialism” — not to mention a “radical communist” who must be “stopped” or else America will “cease to exist” — the overheated rhetoric has been gradually getting higher in volume, intensity, and frequency with each passing week.

The initial concern that this raises is the possibility of a new wave of citizen militias, particularly when you have mainstream pundits like Glenn Beck out there helping to promote the concept. As Glenn Greenwald observed, the “Patriots” are back with a vengeance.

At least for the time being, however, there isn’t any evidence of new militias forming, though we may see numbers growing within the coming months within existing units, particularly as Fox News and radio pundits start fueling right-wing anxieties.

However, we are starting to see a trend that’s even more disturbing: Military veterans voicing Patriot-movement beliefs, including threats of violent resistance to the Obama administration.

If anyone is foolish enough to think these guys are actually about liberty, I suggest you ask them where they have been for the past 8 years, or their views on Bush’s leadership.  There is a disturbing proto-fascist element to the militia movement which is really worrying.

A look inside the corporate PR machine

There are two excellent pieces up on The eXiled right now which you need to be reading.  They are Is CNBC’s Rick Santelli Sucking Koch, and Koch activists teabag media.

I’ll leave you to read them in your own time, but I could smell the PR bullshit coming off these Tea Party protests from the start, I just didn’t have the time or the inclination to dig.  Nevertheless, an insight into how these things work is always nice.  As Ames points out

So today’s protests show that the corporate war is on, and this is how they’ll fight it: hiding behind “objective” journalists and “grassroots” new media movements. Because in these times, if you want to push for policies that help the super-wealthy, you better do everything you can to make it seem like it’s “the people” who are “spontaneously” fighting your fight. As a 19th century slave management manual wrote, “The master should make it his business to show his slaves, that the advancement of his individual interest, is at the same time an advancement of theirs. Once they feel this, it will require little compulsion to make them act as becomes them.” (Southern Agriculturalist IX, 1836.) The question now is, will they get away with it, and will the rest of America advance the interests of Koch, Santelli, and the rest of the masters?


Over at Chaos Marxism, a cunning plan has been hatched.

I’m down with this.  God knows, all I do every day is read political theory texts and blogs anyway, it would be nice to engage myself somewhat more critically with the whole process.  I have also been taking notes from TV Tropes, for my own attempts of fiction, once I start writing fiction again (in between searching for jobs, reading, blogging and contributing to several internet fora – sooner or later, something will give, most probably me).  Should those come to fruition, I’ll probably spend days getting people to read them, so no doubt you will all know when it happens.

Anyway, I know a couple of peeps from PD, such as Cramulus, have also expressed potential interest in this project, and board members always have tons of hosting space lying around, doing nothing (for some bizarre reason).  Hopefully, enough people will register interest to get a viable site going once I get to pitch the idea to the members.  Worst comes to worst, I’ll dump the ideas on a free blog until someone less in debt and more technically competent than me gets a Wiki on the project started.

Edit: NlhasdAJHLgkgli.  Seriously, that’s what the inside of my head feel’s like.  I tried, but my mind is so fried right now I can’t express myself the way I want.  I need a proper night’s sleep.

Burn baby burn

Increasing complex systems have a tendency to collapse in more catastrophic ways.  Hence, when George Soros and Nassim Nicholas Taleb say that this economic crisis will be worse than the Great Depression, I am not surprised at their appraisal.

However, what does a Depression actually mean, in our current socio-political economic condition?  No doubt, circumstances across those three areas of analysis do differ from the 1930s and so we have to ask ourselves, what does that mean for us?  The only viable mass movements of the moment seem to be, at least in the American contexts, religious ones.  In the UK, I don’t think even that is possible.  While I think the worries about fascism, at least in parts of the Third World, are valid, platforms explicit about such a program are rejected, and not just because of the negative connotations of such labels.

And how will the internet affect such a Depression, as well?  Will we see spontaneous protests, or even peaceful urban takedowns, orchestrated via Facebook and Twitter?  Or will the net become a talking shop, the modern day equivalent of a soapbox, where gripes and despair about our current conditon are aired but little else is actually done?

Obviously, my thoughts turn to recent graduates and attempts to get jobs, for personal reasons.  Will unemployment and the lack of prospects lead to, as it did in Italy in the 60s, a militant intellectual movement who felt they had more in common with the proletariat than their (usually) middle class backgrounds?  Or could it breed a new class of cosmopolitan guerrilla entrepreneur, an anti-Davos man if you will.

I could really do with a team of sociologists and cultural theorists right now.

Panic! at the economic disco

Just a short economic roundup:

Japan’s economy is going down the tubes at the fastest rate in 35 years.

Ireland could default.

Keep an eye on Eastern Europe (yes, I know the Telegraph are apocalyptic enough as it is, but hysteria aside, there are valid concerns about the state of the region)

China’s recovery may be riding on the back of sham loans

Kansas is having money trouble

Collateralized Loan Obligations could be next financial black swan.

Santander has liquidity issues.

In summation, things don’t look too good.  More and more, I find myself agreeing with John Robb, even when I actively try not to.

Always the bridesmaid, never the bride…

For some unthinkable reason, I was not invited to Technoccult’s roundtable on the future of the nation-state.  Probably because they’ve never heard of me, Wes and Edward aside, but I won’t let that get in the way of some good snark.  Besides, I can now claim to be a renegade renegade futurist, which justs adds to my edgy appeal.  Or something.

Anyway, good question.  The whole viability/decline of the state has become a very interesting question in light of the credit crunch.  And I have more than a passing interest in social organization in the past and present, in no small way due to reading John Robb for the past three years or so.

Continue reading Always the bridesmaid, never the bride…

Is George Friedman smoking crack?

Stratfor’s analysis is starting to show its bias much more:

Note the section on the US missile program in central Europe.  Unless something has changed radically, the last I heard was Obama was putting the kibosh on the project at least until the Pentagon could make the case it had to be in Europe, and in return, Russia was withdrawing its plans to put nuclear warheads in Kaliningrad, which would allow them to strike anywhere in Europe with even their smallest nuclear capable missiles.

Also on Kyrgyzstan, while the analysis is accurate, they in no way mention the cyber attack which was almost certainly undertaken by Russian proxies there – one which may have been a trial run to see how US forces coped with bandwidth poor environments.  The US military is massively dependent on using state of the art communication systems, and they did have problems in Central Asia when first moving into those bases, in 2001-2002.  Russian expertise in cyber warfare is nothing new, but running an attack which may have been designed to test US responses is.  In the Georgia/Russia spat earlier last year, the Russians were probably too busy actually attacking Georgian websites and communications to see what they could do to American bases in the country.  This time, they had an attackers advantage, in choosing the time and place.  Given Obama, just today, is reviewing cyberspace security, I would think this was much more important than Russia’s long standing objections to the US presence in its percieved sphere of intersest.

And just to confirm my suspicions, I get a new email:

In our 2009 Annual Forecast, we let Stratfor Members know that Russia is resurging–but can she really do it? The short answer is YES.

Russia needs more than economic power to mount a real resurgence–military power is an equally important aspect. So we’re introducing a special four-part series on the Russian Military.

UUUUUNNNNGGGGHHHHHHH.  Paul Kennedy is quietly weeping somewhere.  Military superpowers need to be economic powerhouses first and foremost.  Obviously, a super rich country with little population is not much of a military risk (see: Saudi Arabia), but equally a populous country with a weak economy is not nearly as much of a threat as one with a strong economy.

Russia had an economy comparable to Portugal, a thin strip of mostly barren land on the Atlantic sea, which makes the majority of its money from tourists who don’t realize they crossed the border from Spain, and from the quite frankly disgusting “firewater” drink.  Oh, and Port, of course.

And most of this was because of Russian reliance on energy resources, in particular oil and gas.  Oil prices have essentially collapsed, putting the Russian economy in dire straits.  Their weapons systems are their second main export, but with the economic crisis hitting their main clients hard as well, they cannot hope to pick up the loss of earnings there.

Russia still has a decent amount of firepower, of course.  It has the world’s biggest stockpile of nuclear weapons, for starters.  It has numerous WMD programs, including a very advanced biological weapons division.  They still maintain large numbers of missiles, both conventional and otherwise.  Its intelligence assets were primed towards Europe and America for 60+ years, and many of those assets are still around, if in a reduced capacity.  It also has its much vaunted cyber warfare capacity.

But those are costly to maintain.  Equally, Russia’s population is steadily decreasing, as is its economy.  Sooner or later, cuts will have to be made, in order to save the careers of those in the Duma and Kremlin.  And Russia is already well behind in certain technical innovations than NATO, China and Japan.  Can they sustain the economy necessary for high-tech research and their already existing military power, which is still a shadow of what the USSR possessed?  Highly unlikely.  Unless Russia can reverse its economic woes, presumably by seizing the Arctic oilfields and then orchestrating price fixing via Gazprom, its a power on the decline.  Again.

Even now, people are still not security savvy

Thanks to Reqiuem who posted this link on the forum.

The most interesting thing is how incredibly limited the range of passwords is.  With enough time, it would be very easy to crack these accounts.  As the author notes, even when the security system forces people to be at least a little more security conscious, they take the path of least resistance and, in the example of Myspace, tack a “1” on the end of their usual password.

Obviously it would be very hard to get this data, but I’d be fascinated in seeing how this sort of information correlates with that for important passwords, like those which allow access to emails or online stores or banks.  I’d be willing to bet many of the passwords are very similar, and could easily be found out with minimal data-mining of an intended target.

Bruce Schneier once wrote a brilliantly funny, yet sadly true, article, about the security mindset vs the normal human mindset once.  As I recall, his main point was that the security minded person looks at a system and thinks “how can I abuse that?”, whereas the normal person tends to use the system in the correct way and context, without paying much attention to how the system could be subverted or turned to other ends.  That is certainly part of it.  I also think its because people are used to seeing a computer as their personal possession, and everything on it as an extension of that.  Yet the internet is very much a shared space, which all sorts of characters can and do use.  But because people feel they own their computer, they feel free only taking minimal security precautions, more as ritual and formality than with any mind to actually defending accounts against possible intrusion.

I’ve often stated critical thinking should be on every school cirriculum, but now I’m starting to wonder if perhaps Security 101 shouldn’t be added to that list as well…