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THE WOLF STREET REPORT: How the Fed Boosts the 1%, as Told by the Fed

THE WOLF STREET REPORT: How the Fed Boosts the 1%, as Told by the Fed

Even the upper middle class loses share of household wealth to the 1%. The bottom half gets screwed.

The Federal Reserve’s Shell Game

The Federal Reserve’s Shell Game

Inflation, wealth redistribution, and the subtle art of misdirection

The Federal Reserve is a key component of the US government’s wealth redistribution apparatus. Under the guise of “macroeconomic management,” it redistributes vast amounts of wealth on an ongoing basis through inflation. The victims of these transfers are ordinary Americans. The beneficiaries are the government and its elite cronies.

The Fed masks the nature of this surreptitious taxation and corporate welfare by performing a simple shell game that is just complicated enough to confound the general public.

First, let’s imagine the government performing this kind of inflationary transfer without the shell game.

Let There Be Money

Imagine Uncle Sam sitting at a desk, representing the Federal government. His right hand is the Treasury. It has the government’s main bank account, represented by a ledger on the desk. Uncle Sam also has revenue collecting powers, represented by a gun resting on the desk, which he uses to extort taxes from the public. Whenever he confiscates money, the cash balances of the public decline, and Uncle Sam’s ledger increases by the same amount.

As the God of the Bible could say, “Let there be light” (in Latin, fiat lux) and it was so, the State can say, “Let there be money” (fiat pecunia) and it is so.

Now let’s say Uncle Sam wants to raise $200 million for current expenditures: bureaucrat salaries, weapons purchases, welfare payments, etc. The problem is, the public has a limited tolerance for overt taxation. So, at a certain point, if Uncle Sam simply gestures to his gun again to levy the funds, he might face a tax revolt.

…click on the above link to read the rest of the article…

 

Paul Ehrlich: ‘Collapse of civilisation is a near certainty within decades’

Fifty years after the publication of his controversial book The Population Bomb, biologist Paul Ehrlich warns overpopulation and overconsumption are driving us over the edge

The toxification of the planet with synthetic chemicals may be more dangerous to people and wildlife than climate change, says Ehrlich.
The toxification of the planet with synthetic chemicals may be more dangerous to people and wildlife than climate change, says Ehrlich. Photograph: Linh Pham/Getty Images

Ashattering collapse of civilisation is a “near certainty” in the next few decades due to humanity’s continuing destruction of the natural world that sustains all life on Earth, according to biologist Prof Paul Ehrlich.

In May, it will be 50 years since the eminent biologist published his most famous and controversial book, The Population Bomb. But Ehrlich remains as outspoken as ever.

Prof Paul Ehrlich of Stanford University.
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Prof Paul Ehrlich of Stanford University. Photograph: Alamy Stock Photo

The world’s optimum population is less than two billion people – 5.6 billion fewer than on the planet today, he argues, and there is an increasing toxification of the entire planet by synthetic chemicals that may be more dangerous to people and wildlife than climate change.

Ehrlich also says an unprecedented redistribution of wealth is needed to end the over-consumption of resources, but “the rich who now run the global system – that hold the annual ‘world destroyer’ meetings in Davos – are unlikely to let it happen”.

The Population Bomb, written with his wife Anne Ehrlich in 1968, predicted “hundreds of millions of people are going to starve to death” in the 1970s – a fate that was avoided by the green revolution in intensive agriculture.

Many details and timings of events were wrong, Paul Ehrlich acknowledges today, but he says the book was correct overall.

“Population growth, along with over-consumption per capita, is driving civilisation over the edge: billions of people are now hungry or micronutrient malnourished, and climate disruption is killing people.”

Ehrlich has been at Stanford University since 1959 and is also president of the Millennium Alliance for Humanity and the Biosphere, which works “to reduce the threat of a shattering collapse of civilisation”.

“It is a near certainty in the next few decades, and the risk is increasing continually as long as perpetual growth of the human enterprise remains the goal of economic and political systems,” he says. “As I’ve said many times, ‘perpetual growth is the creed of the cancer cell’.”

…click on the above link to read the rest of the article…

 

High Levels of Youth Unemployment – and Runaway Inequality – Cause Riots

High Levels of Youth Unemployment – and Runaway Inequality – Cause Riots

Recipe For Disaster

We’ve known for 1,900 years that runaway inequality destroys societies.

The great American historian Will Grant wrote in 1969:

In progressive societies the concentration[of wealth] may reach a point where the strength of number in the many poor rivals the strength of ability in the few rich; then the unstable equilibrium generates a critical situation, which history has diversely met by legislation redistributing wealth or by revolution distributing poverty.

A 2011 study this month by economists Hans-Joachim Voth and Jacopo Ponticelli shows that – from 1919 to the present – austerity has increased the risk of violence and instability.

Peter Turchin (professor in the Department of Ecology and Evolutionary Biology, and an adjunct professor in the departments of Anthropology and Mathematics at the University of Connecticut) pointed out in 2013 that inequality is cyclical, skyrocketing until – periodically – revolution forces concessions from those who have grabbed all the wealth.

Indeed, leading institutions and economists all over world warn that runaway inequality could cause violence and unrest.

For those who work for a living, the level of inequality in America today is arguably the highest in world history.

A high level of youth unemployment is also a leading cause of riots. As we noted in 2011:

…click on the above link to read the rest of the article…

 

 

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