3-20-05

Before we begin, let us all take a moment to reflect on a picture worth a thousand words:

Well, it's been a while since I've blogged in here, I've been following some leads and doing some research for what I call "the big adjustment", a phrase I am borrowing from a recent speech by Paul Volker. Volker, for those of you who don't know, was the Federal Reserve chief that Alan Greenspan (our current fed chief) replaced. He's also a former Deputy Secretary of the Treasury, chairman of the Federal Reserve Bank of New York, North American chairman of the Trilateral committee, and author of several books. He is most well known for being the key architect of the Reagan administration's "trickle-down" economics.

Referring to America's inability to balance its books, the esteemed economist had this, among other things to say:

"Below the favorable surface [of the economy], there are as dangerous and intractable circumstances as I can remember�. Nothing in our experience is comparable� But no one is willing to understand this and do anything about it� We are consuming� about six per cent more than we are producing. What holds the world together is a massive flow of capital from abroad� it's what feeds our consumption binge� the United States economy is growing on the savings of the poor� A big adjustment will inevitably become necessary, long before the social security surpluses disappear and the deficit explodes� We are skating on increasingly thin ice."7

He's not talking about a big adjustment to our lifestyles (although that's implied), he's talking about an adjustment to the accounting of the American economy.

See the video of that speech here

Apart from the fact that we consume more than we produce, that the retiring baby boomers will drain the treasury, that many of the world's central banks are dumping dollars in favor of Euros, there are other "intractable circumstances", the most obvious of which is Peak Oil. The most comprehensive explanation I have seen on the subject was an hour long presentation in the United States House of Representatives just a few days ago, which you can read by clicking here. It's a long read, but is absolutely critical to understanding what's going to happen over the next twenty years. We have reached the apex of world oil production. We stand at the top of the bell-curve, arms raised in victory, ignoring the precipice that looms below.

Also, the Bank of International Settlements-- which co-ordinates policy among central banks, which then in turn co-ordinate policy of the commercial banks in thier respective countries-- has shown in thier latest quarterly review that Asian Banks have dumped 13% of thier dollars for local currencies, a trend that began in Europe a few years ago.

Speaking of International Banking, President Bush has chosen the next man to lead the World Bank, and that man is Paul Wolfowitz-- Deputy Defense Secretary, key architect of the invasion and occupation of Iraq, and a man with no experience in economics, unless you count the economics of war. This makes perfect sense. After all, in 1969, Robert McNamara was appointed chief of the World Bank after escalating the Veitnam war from a few hundred Green Berets to half a million U.S. troops, leading to the pointless deaths of more than 50,000 American troops and untold numbers (millions) of Veitnamese. President Bush knows that in the dark times ahead, it'll be good to have man in charge of the World Bank who's not afraid to let thousands of civilians die for ideological reasons.

And finally, let's talk about my hero Cynthia McKinney. After being re-elected to the House of Representatives by her district in Georgia, she is upholding her promise to speak truth to power. In recent weeks she has dogged Defense Secretary Rumsfeld and JCS Chairman Myers over, among other things, the $3.3 trillion that the pentagon "lost" in fiscal years 1999 and 2000, who was in charge of co-ordinating the four wargames that crippled the eastern sector's air defense on 9/11, and allegations of Dyncorp (a pentagon contractor) involvement in the child sex-slave trade. To see an absolutely priceless video clip of Donald Rumsfeld stuttering and yammering, juxtaposed by McKinney's calm glare, please click here, then scroll to the bottom of the page and click play (you must have realplayer to see it).

All I can think when I watch that clip is "that's my girl". Remind me to write her a letter.