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He Cooperated with the Cops — and is Paying the Price: The Ordeal of Mark Byrge

27 Apr

American Fork, Utah

When Mark Byrge had a minor traffic accident on a street in American Fork, Utah, he did the “responsible” thing by reporting the incident to the police. He has never stopped paying for that mistake.

Within a few minutes of receiving Mark’s call, a pair of American Fork cops arrived to document the damage to Byrge’s delivery truck from a collision with a tree branch that protruded into the street. Mark was cooperative – and he put up no resistance when the lead officer, Andres Gianfelice, placed him under arrest for an outstanding traffic ticket (as well as citing him for not providing proof of insurance).

Byrge submitted without complaint to his officially sanctioned abduction, including the demeaning injury of being shackled. He politely made a single request of his captors: Owing to several back surgeries and the implantation of a $50,000 Spinal Cord Stimulator (SCS), Mark asked that the officers cuff him in front.

While explaining his condition, Mark very slowly and carefully lifted his shirt in order to display an iPod-sized rectangular lump in his lower right back.

Neither Mark’s cooperation nor his explanation made an impression on Gianfelice.

“Don’t tell me how to do my job – put your hands behind your back!” barked Gianfelice, instructing his trainee officer, Jennifer Nakai, to apply the cuffs. Before being shackled, Mark called his wife Tina to tell her he was being arrested.

He didn’t disconnect the call – which means that Tina was able to hear everything that would happen over the next several minutes.

Despite the fact that he was obviously in pain, Mark placed his hands behind his back. Local resident Bob Cardon, on whose property the untrimmed tree was located, expressed concern over Mark’s treatment.

“Do you really have to handcuff him that way?” the elderly man asked the officers.

“Shut up, or you’ll be put in the car next to him,” snarled Gianfelice.

After Mark was stuffed into the back seat of Gianfelice’s cruiser, he leaned away from the cuffs, attempting to prevent any damage to the expensive medical appliance embedded in his back.

Ignoring Mark’s protests, Gianfelice shoved him against the seat to buckle his seat belt. As that happened, Mark later recalled, “I could actually feel it [the stimulator] breaking.”

“You stupid son of a bitch,” Mark gasped, “you just wrecked my back.” He didn’t know at the time that Tina was listening to this exchange over an open phone line.

Tardily realizing that he had made a terrible mistake, Gianfelice relented and used a “belly chain” to cuff Mark in the front. This allowed the officer to claim in his official report that he had “accommodated” Mark – but by that time irreparable damage had already been done.

The SCS was designed to send electrical impulses along Mark’s spine in order to neutralize pain receptors. This allowed him to ramp down his dosages of narcotic prescription pain medications. This, in turn, is what made it possible for him to run his courier delivery business, which required both the physical capacity to load and unload cargo, and the mental acuity to drive his truck and fill out paperwork. Without the stimulator, Mark would either be too crippled to lift, or too doped-up to focus.

Subsequent medical scans of his stimulator documented that it went inactive on April 18, 2012 – the day that Officer Gianfelice, after arrogantly dismissing Mark’s entirely reasonable request to be cuffed in the front, shoved him against the rear seat of his police cruiser.

As Gianfelice pulled away from the scene of the accident, Mark informed the officer that he needed to be taken to a hospital, and he eventually convinced the officer that the jail wouldn’t admit him without hospital clearance. When they arrived at the hospital, Gianfelice parked about fifty yards away – significantly, in one of the few spots concealed from security cameras.

By this time, Mark’s right leg was already convulsing – a tell-tale indication that the SCS had malfunctioned. Gianfelice dragged Mark out of the cruiser by his right arm and began walking him toward the hospital entrance. Mark’s right leg had seized up and was refusing to cooperate with his own wishes, let alone the demands of his captor. In his subsequent report, the officer claimed that Mark began “pulling” and “jerking” away from him.

The officer didn’t explain why a handcuffed man who was in obvious pain and who had asked to be taken to the hospital would “resist” being escorted to the emergency room. Nonetheless, in short order, Mark found himself face-down in the dirt of a nearby flower bed with Gianfelice on top of him, shouting the shared refrain of police and rapists: “Stop resisting! Stop resisting!”

“I’m not resisting – get off my back!” pleaded Mark. Indeed, given his physical condition, Mark didn’t have the ability to resist.

Gianfelice claims that the crippled, handcuffed man somehow managed to drag the two of them down to the ground. Mark reports that the officer threw him down and to the right. However they wound up on the ground, the officer – knowing that Mark had a back injury – drove his knee into Mark’s lower back, placing his entire body weight on the fragile and expensive piece of hardware embedded under Mark’s skin.

This incident was witnessed over the open phone line by Mark’s wife, Tina.

Officers Gianfelice and Nakai pulled Mark to his feet and escorted him into the emergency room. Once inside, Mark gasped out a complaint to the first nurse he saw:

“This officer just assaulted me. Please call for a third party officer to investigate.”

The nurse, who was legally obligated to report on an assault against a“vulnerable adult,” ignored Mark’s request. The officer responded by “check-punching” the handcuffed victim in the chest.

“What the hell are you doing?” Mark exclaimed, his patience long since exhausted. “Let me f****ng go!”

“Don’t use that kind of language!” snapped the nurse, suddenly alert to matters of decorum after being torpidly indifferent to the violence inflicted on Mark.

Gianfelice cited Mark for “disorderly conduct,” listing the offended nurse as a witness. Predictably, his report didn’t mention his act of criminal battery against the handcuffed victim. That crime, however, was documented by the emergency room’s security camera. Significantly, Gianfelice did not charge Mark with “resisting arrest.”

This was the only video record made of the encounter between Mark Byrge and the American Fork PD – despite the fact that the department takes extravagant pride in the fact that all 33 of its patrol officers are “wired” with VidCam units.

“The American Fork Police Department claims to be the first law enforcement agency in the country to outfit all of its officers with video cameras and microphones pinned to their uniform,” reported the Salt Lake Tribune in November 2007.

“We’ve been waiting. We’ve been looking for something like this to document the good work that police officers do,” explained Lt. Sam Liddiard.

Last October, Lt. Liddiard told KSL news that “any time an officer deals with someone, they’re required to be recording.” He offered unqualified praise for the video recording technology, insisting that the record usually cleared officers accused of abuse.

There were three wired officers involved in the encounter with Mark Byrge – Gianfelice and his trainee, Nakai, and their supervisor, Sgt. James Bevard. The officers either suffered an inexplicable simultaneous failure of their VidCam units, or they didn’t bother to activate them. Nor was a dashcam recording made by either of the police vehicles on the scene.

Shortly before Mark was assaulted by Gianfelice, he had visited a local clinic to have his SCS calibrated. He went back to the clinic following the assault and was told that the leads connecting the device to his spine had shifted, rendering it useless. The device had stopped functioning on the morning of April 18 – while he was in the custody of the American Fork Police.

Since that incident, “the patient’s pain as gotten worse and his right leg is now showing signs of possible Complex Regional Pain Syndrome,” observed Gary Child of the Utah Pain Relief Center in April 2013. CRPS is a serious degenerative condition that has left Mark unable to work – and is rapidly depriving him of the ability to walk.

Mark is a 43-year-old former football player and wrestler with a compact, muscular build and low center of gravity. He walks with the assistance of a cane as his right leg atrophies. Dark striations are inscribed in his right foot, ankle, and shin. His toes are splayed at wild angles owing to involuntary muscle contractions and spasms that convulse his right leg without warning or relief.

His body slowing cutting off circulation to his lower extremity “as if it is trying to break off my foot,” Mark explained to me. CRP Syndrome can lead to other severe complications, including major organ failure.

“There’s a good chance that this could be what kills me,” Mark predicts.

It should be recalled that Mark was entirely cooperative in his dealings with the American Fork Police Department. As Gianfelice admitted in his report, he had the option of cuffing Mark in the front, rather than wrenching his arms behind his back. Why was he so intransigent?

Mark points out that Gianfelice was accompanied by a trainee officer, which “always creates a temptation to show off, be a hard case, and put the citizen in his place.” An officer will be especially prone to strut and show off when the trainee is an attractive blonde female, like Officer Nakai.

Prior to the arrest, Mark and Gianfelice did exchange words. While the officer was taking photos of the accident, Mark suggested that he get a few of the protruding tree branch, which should have been clipped by a city maintenance crew.

“You sound like someone who doesn’t want to accept responsibility,” hectored the officer.

“Well, you sound like a city employee who’s worried about financial liability,” Mark replied.

The officer responded by ordering Mark into the cab of his truck – before ordering him out to arrest him.

As Mark attempted, unsuccessfully, to recover from the trauma inflicted on him by Officer Gianfelice, he filed complaints with the American Fork Police Department. He collected witness statements from several people who had been on the scene, as well as his wife and brother, who had overheard the incident over the open cell phone connection. He assembled statements from health care professionals about the damage done to him by Gianfelice’s assault. When the AFPD didn’t respond, Mark took his evidence to the Utah County Sheriff’s Office.

Mark’s persistence didn’t endear him to AFPD Chief Lance Call.

“You’ve run to every agency on the Wasatch Front,” groused Call when Mark contacted him to demand that action be takenr against Gianfelice. “I already investigated it – and I cleared the officer.”

“You didn’t talk to any of the witnesses or review any of my evidence,” Mark plaintively replied. “How can you `clear’ him just by reviewing his side of the story?”

“I told you `no’!” Call responded, hanging up.

“After this happened, I called the mayor’s office, even though it was after five o’clock,” Mark recounted to me. “I left him a message describing what Call said, and why I needed him to support an honest investigation.”

Unexpectedly, Mark received a reply the first thing the following morning.

“The mayor called at about 8:00 and left a message on my answering machine, telling me that he was going to have the Utah County Attorney’s Office conduct an investigation,” Mark relates. “The fact that this literally happened the first thing the morning after my call indicates that the mayor and other officials had been discussing what to do about my case.”

Before the county attorney’s office began its inquiry, Mark received another official visit from the AFPD.

“An American Fork officer showed up at our door – a really big guy I hadn’t seen before,” Mark attests.

“I’m here to tell you that if you pursue this it will not go well for you,” the officer growled at Mark, taking care to cover his badge with one hand.

“What’s your name?” Mark asked. “Are you threatening me?”

“You should just know that this isn’t going to go well for you,” the officer said, ignoring Mark’s question and turning to leave.

The official inquiry, which was conducted by Sgt. Scott R. Finch of the Utah County Sheriff’s Office, was the typical preordained exercise in validation. In his interview with Finch, Gianfelice repeatedly claimed that he “could not recall,” “could not remember,” or “could not recall from memory” several critical details of the incident.

Among the matters that eluded the memory of this trained observer was whether “he was shown anything that would indicate Mr. Byrge had a back injury”; whether “he or someone else did the handcuffing of Mr. Byrge”; whether “he handcuffed Mr. Byrge in front initially or if he was cuffed behind his back at first”; or if “any other citizens [were] present or approached them at the scene of the accident.” He offered the unqualified statement that Mark “did not complain of injury when they were on the scene.”

Two witnesses one the scene – Bob Cardon and Jason Wilde – testified that Mark complained of his back injury. This was confirmed by two witnesses who overheard the encounter via cell phone.

In his initial statement to Sgt. Finch, Gianfelice claimed that “he will evaluate or estimate a person’s flexibility and size and help them out by handcuffing them in front” and that he told Mark “he had a belly chain and he would allow Mr. Byrge to be cuffed in front.”

After Finch provided Gianfelice with a copy of his report “to refresh his memory,” the officer changed his original story, admitting that he did initially cuff Mark behind his back before transferring the cuffs to the front. This is the crux of the issue: Gianfelice ignored Mark’s pleas to cuff him in front until after the damage had been done, then he lied about doing so during the subsequent investigation. He did this despite clear and detailed warnings about what this would do to the victim.

In the original reports from Gianfelice and Nakai, Mark was described as “not combative.” In their revised versions, he was described as “out of control, angry, loud, and yelling.” Significantly, in her initial account of the “scuffle” at the hospital, in which Gianfelice wound up with his knee in Mark’s back, Nakai said she “was not sure what caused Mr. Byrge to fall” because “she was on the other side of the car” – yet despite the fact that she didn’t see what happened she insisted that this was caused by “Mr Berge jerking his arms away and he lost his balance.” She conceded that Gianfelice might have used a “touch-push” to deal with a supposedly uncooperative detainee.

Despite these abundant and crucial self-contradictions, Finch pronounced the expected benediction on his fellow officers, concluding that “After conducting this investigation I believe the officers’ actions were legal and responsible.”

Charged with “disorderly conduct,” Mark – who was forced to represent himself — attempted to obtain sworn statements from officers Gianfelice and Nakai.

“Sgt. Finch said that this wouldn’t be necessary, because they were sworn officers already under oath,” Mark informed me. “But all of my witnesses were required to make sworn statements under penalty of perjury. And then when I attempted to enter the officers’ statements as evidence in my trial, I was told that they weren’t admissible, because they hadn’t been made under oath. So I was deprived of any opportunity to demonstrate that the officers had contradicted themselves – which meant that I had no defense.”

Fully disabled and unable to make a living, Mark is pursuing a civil rights case against the AFPD. He is also a candidate for the Utah State Legislature.

“My campaign is going to focus entirely on abuse of power by public officials, especially the police,” Mark told me. “I’m in constant pain, and my body is literally devouring itself. I want to do anything I can to prevent this from happening to somebody else.”

Meanwhile, the assailant who left Mark an invalid, Andres Gianfelice, is receiving a salary of $83,682 a year as part of a 33-officer force patrolling a city of 21,000 people with a negligible violent crime rate. Officer Nakai, one year after finishing her probationary term, is drawing an annual salary of $63,932 – a pretty decent rate of compensation for a job open to anybody with a GED and a capacity for casual sadism.

 

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Wage Discrimination

27 Apr

“President Obama Vows Zero Tolerance on Gender Wage Gap,” read one headline. Another read, “Women Still Earned 77 Cents On Men’s Dollar In 2012.” It’s presumed that big, greedy corporations are responsible for what is seen as wage injustice. Before discussing the “unjust” wage differences between men and women, let’s acknowledge an even greater injustice — which no one seems to care about — age injustice.

According to the Bureau of Labor Statistics, workers ages 16 to 24 earn only 54 cents on every dollar earned by workers 25 or older (http://tinyurl.com/n6puf6j). This wage gap is 43 percent greater than the male/female gap. Our president, progressives, do-gooders, academics and union leaders show little interest in big, greedy corporations ripping off the nation’s youth. You might say, “Whoa, Williams! There’s a reason younger people earn less than older people. They don’t have the skills or experience.” My response would be — if I shared the vision of the president, media elite and do-gooders: Just as there can be no justification for big, greedy corporations paying women less than they pay men, there’s no justification for them to exploit the nation’s youth.

The 77 percent median income statistic, used in discussions about male/female differences in earnings, tells us nothing about differences that might explain the differences in income, and it leads to stupid discussions. Let’s use some common sense and look at some differences between men and women that may have a bearing on earnings.

Kay S. Hymowitz’s article “Why the Gender Gap Won’t Go Away. Ever,” in City Journal (summer 2011), shows that female doctors earn only 64 percent of what male doctors earn. But it turns out that only 16 percent of surgeons are women, whereas 50 percent of pediatricians are women. Even though surgeons have put in many more years of education and training than pediatricians and earn higher pay, should Obama and Congress equalize their salaries? Alternatively, they might force female pediatricians to become surgeons.

There are inequalities everywhere.

According to the Bureau of Labor Statistics, Asian men and women have median earnings higher than white men and women. Female cafeteria attendants earn more than their male counterparts. Females who are younger than 30 and have never been married earn salaries 8 percent higher than males of the same description. Among women who graduated from college during 1992-93, by 2003 more than one-fifth were no longer in the workforce, and another 17 percent were working part time. That’s to be compared with only 2 percent of men in either category. Hymowitz cites several studies showing significant career choice and lifestyle differences between men and women that result in differences in income.

According to 2010 BLS data, the following jobs contain 1 percent or less female workers: boilermakers, brick masonry, stonemasonry, septic tank servicing, sewer pipe cleaners and trash collectors. By contrast, women are 97 percent of preschool and kindergarten teachers, 80 percent of social workers, 82 percent of librarians and 92 percent of dietitians and nutritionists and registered nurses.

For people having limited thinking skills, differences in earnings cannot be explained away. For them, Congress has permitted — and even fostered — a misallocation of people by race, sex and ethnicity. They’ll argue that courts have consistently concluded that “gross” disparities are probative of a pattern and practice of discrimination. So what to do? Maybe President Obama and Congress should require women, who are overrepresented in preschool and kindergarten teaching, to become boilermakers, garbage collectors and brick masons and mandate that male boilermakers, trash collectors and brick masons become preschool and kindergarten teachers until both of their percentages are equal to their percentages in the population. You say, “Williams, to do that would be totalitarianism!” I say that if Americans accept that Congress can force us to buy health insurance, how much more totalitarian would it be for Congress to force people to take jobs they don’t want?

 

Our Oligarchs Can Thank James Madison

27 Apr

According to authors Martin Gilens and Benjamin Page:

The central point that emerges from our research is that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.

Fortunately for The Average Joe, however, his stated policy preferences happen to coincide with the desires of the wealthy elites much of the time, (according to the study) so even though his views and desires don’t matter in Congress, he nonetheless sometimes gets what he wants, simply by coincidence.[1]

It’s only when the desires of middle-income Americans are in conflict with the goals of interest groups and the wealthy elites that he is likely to lose most of the time:

Not only do ordinary citizens not have uniquely substantial power over policy decisions; they have little or no independent influence on policy at all.

Are interest groups and wealthy elites more powerful than the average American? Certainly evidence of that is all around us, with perhaps the most obvious and dramatic example in recent years being the passage of the Troubled Asset Relief Program (TARP) engineered by the Bush administration in 2008 to bail out wealthy hedge fund managers and bankers who had run their companies into the ground. Prior to the passage of TARP, members of Congress admitted that calls from their constituents were 95 percent or more against the passage of TARP. Congress passed the legislation anyway, handing about a trillion dollars of taxpayer money to wealthy corporations, bankers, and other interests.

James Madison and Federalist #10

According to the propagandists for the centralization of the American national government in 1787, known euphemistically today as “Federalists,” the size, scope, and diversity of the United States is supposed to make such looting impossible. The claim that a larger and more expansive government produces more freedom may seem counterintuitive to some, but such is the proposition taught to American school children year after year.

We have James Madison, and specifically his Federalist Paper No. 10, to thank for the popularity of this rather dubious theory.

In the essay, Madison’s position is that large expansive republics are superior to small limited republics because they balance a variety of “factions” (by which he meant interest groups and voting blocs) against each other and prevent any single group from unduly influencing the government. In a small republic, Madison argued, small factions are able to easily take control of the state’s resources or the state itself. Included among these factions is any large voting bloc with similar interests. The majority and its alleged penchant for the oppression of the minority can be controlled by cancelling out the interests of local majorities at the national level with majorities from other states, thus leading to a balanced population in which no particular faction can gain an upper hand.

Madison’s purpose was to demonstrate that if the American states were allowed to remain largely independent, as they indeed were in 1787, they would degenerate into despotism, but if the states were all consolidated into one federal system, the different factions within the many states would be balanced out and no group or alliance could ever take control of the new government.

Like today’s elites in D.C. and Brussels, Madison’s greatest fear was political decentralization and disintegration, and upon reading No. 10 and other Federalist writings, it quickly becomes clear that many of them were obsessed with the idea of the United States being torn apart by separatist and rebellious factions. This preoccupation is easy to understand if we remember that the convention of 1787 was born out of hysteria over domestic terrorism. That’s not the terminology they used at the time, of course, but the catalyst for the convention was Shays’ Rebellion. The response of the wealthy elites at the time — people like George Washington and James Madison — was to call for a massive expansion of government power to ensure that any future resistance movement could be easily crushed.

The Anti-Federalist Response

Many of the anti-Federalists, including “Cato” disputed the assertions of Madison (who offered precious few real-world examples to support his theory).

Specifically, Cato’s letters argue that smaller states are superior to larger ones because they control less wealth and fewer resources, and therefore offer fewer benefits to factions seeking power, while at the same time limiting the scope and complexity of state matters to a scale at which “average” citizens can hope to understand and witness the dangers posed by those seeking to extract government favors. Cato quotes Montesquieu:

[T]here are too great deposits to intrust in the hands of a single subject, an ambitious person soon becomes sensible that he may be happy, great, and glorious by oppressing his fellow citizens, and that he might raise himself to grandeur, on the ruins of his country. In large republics, the public good is sacrificed to a thousand views; in a small one the interest of the public is easily perceived, better understood, and more within the reach of every citizen; abuses have a less extent, and of course are less protected.

In other words, small republics prevent any one interest from seizing the sort of super-sized power that would most easily be attained through a more expansive state. Moreover, in a large republic, the overall population consists of many competing factions that pave the way for factions to seize power by encouraging division among the population.

In these arguments we see some early precursors of arguments we find later in Rothbard and Hoppe.[2] Hoppe offers the anti-Madisonian view:

Political integration involves the territorial expansion of a state’s powers of taxation and property regulation. … In general, the smaller a country and its internal markets the more likely it is that it will opt for free trade.

I think that a world consisting of tens of thousands of distinct countries, regions and cantons, and hundreds of thousands of independent free cities such as the present-day “oddities” of Monaco, Andorra, San Marino, Liechtenstein, Hong Kong, and Singapore, would be a world of unprecedented prosperity, economic growth, and cultural advancement.

Conclusion

The anti-Federalists lost and Madison won, so we can now witness the true extent to which a large republic has failed to prevent the rise of exploitive and powerful factions in the United States. The U.S. government now controls more than 2.5 trillion dollars that flow to the treasury every year, inviting every faction, large and small, that hopes to capture even a tiny fraction of this enormous pile of wealth for itself. Never in the history of the world has any single state spent so much and owed so much, while maintaining military bases in every corner of the world while spying, cataloging, taxing, regulating, and imprisoning so many.

At one time, it was thought that those who paid for such “amenities” would rise up and object, but thanks to the vastness of the republic, taxing and spending need never be challenged. This huge, federal republic, so naively assumed by Madison to be balanced against spending and expansion, has instead facilitated a way to allow endless spending by simply spreading out the benefits. Many districts, states, counties, and regions may theoretically be at odds, but their primary concern is getting their share. Whether it’s military spending in the South, subsidies for industry in the North, cheap lands and water for farmers and ranchers in the West, farm bills for the farmers, pensions and pills for the elderly, schools for families, and roads for everyone else, there’s no one left to protest. Meanwhile, the sheer vastness and uniformity of the state’s power nationwide ensures few options for voting with one’s feet to the millions within its enormous frontiers.

The system of oligarchy identified by Gilens and Page is familiar territory to economic historians. Today’s oligarchs are little more than modern versions of the mercantilists of old. It’s unfortunate the American Revolution, a war fought against mercantilist privilege, ended as a Federalist counter-revolution that paved the way for the triumph of similar interests in later decades.

Notes


[1] The study is written by political scientists performing quantatitive analysis, so it’s best to not get bogged down in the numerical details of the study. Nevertheless, while we might critically dissect the assumptions and data behind the report, one is still struck by how very plausible the report’s research and conclusion are.

[2] Rothbard is said to have suggested the name of the Cato Institute due to his affinity for the letters of the Anti-Federalist Cato.

 

Statistical Frauds

20 Apr

 

The “war on women” political slogan is in fact a war against common sense.

It is a statistical fraud when Barack Obama and other politicians say that women earn only 77 percent of what men earn — and that this is because of discrimination.

It would certainly be discrimination if women were doing the same work as men, for the same number of hours, with the same amount of training and experience, as well as other things being the same. But study after study, over the past several decades, has shown repeatedly that those things are not the same.

Constantly repeating the “77 percent” statistic does not make them the same. It simply takes advantage of many people’s ignorance — something that Barack Obama has been very good at doing on many other issues.

What if you compare women and men who are the same on all the relevant characteristics?

First of all, you can seldom do that, because the statistics you would need are not always available for the whole range of occupations and the whole range of differences between women’s patterns and men’s patterns in the labor market.

Even where relevant statistics are available, careful judgment is required to pick samples of women and men who are truly comparable.

For example, some women are mothers and some men are fathers. But does the fact that they are both parents make them comparable in the labor market? Actually the biggest disparity in incomes is between fathers and mothers. Nor is there anything mysterious about this, when you stop and think about it.

How surprising is it that women with children do not earn as much as women who do not have children? If you don’t think children take up a mother’s time, you just haven’t raised any children.

How surprising is it that men with children earn more than men without children, just the opposite of the situation with women? Is it surprising that a man who has more mouths to feed is more likely to work longer hours? Or take on harder or more dangerous jobs, in order to earn more money?

More than 90 percent of the people who are killed on the job are men.

There is no point pretending that there are no differences between what women do and what men do in the workplace, or that these differences don’t affect income.

During my research on male-female differences for my book “Economic Facts and Fallacies,” I was amazed to learn that young male doctors earned much higher incomes than young female doctors. But it wasn’t so amazing after I discovered that young male doctors worked over 500 hours more per year than young female doctors.

Even when women and men work at jobs that have the same title — whether doctors, lawyers, economists or whatever — people do not get paid for what their job title is, but for what they actually do.

Women lawyers who are pregnant, or who have young children, may have good reasons to prefer a 9 to 5 job in a government agency to working 60 hours a week in a high-powered law firm. But there is no point comparing male lawyers as a group with female lawyers as a group, if you don’t look any deeper than job titles.

Unless, of course, you are not looking for the truth, but for political talking points to excite the gullible.

Even when you compare women and men with the “same” education, as measured by college or university degrees, the women usually specialize in a very different mix of subjects, with very different income-earning potential.

Although comparing women and men who are in fact comparable is not easy to do, when you look at women and men who are similar on multiple factors, the sex differential in pay shrinks drastically and gets close to the vanishing point. In some categories, women earn more than men with the same range of characteristics.

If the 77 percent statistic was for real, employers would be paying 30 percent more than they had to, every time they hired a man to do a job that a woman could do just as well. Would employers be such fools with their own money? If you think employers don’t care about paying 30 percent more than they have to, just go ask your boss for a 30 percent raise!

 

Another Phony Budget Debate

20 Apr

Anyone watching last week’s debate over the Republican budget resolution would have experienced déjà vu, as the debate bore a depressing similarity to those of previous years. Once again, the Republicans claimed their budget would cut spending in a responsible manner, while Democratic opponents claimed the plan’s spending cuts would shred the safety net and leave vital programs unfunded. Of course, neither claim is true.

The budget does not cut spending at all, and in fact actually increases spending by $1.5 trillion over ten years. The Republicans are using the old DC trick of spending less than originally planned and calling that reduced spending increase a $5.1 trillion cut in spending. Only in DC could a budget that increases spending by 3.5 percent per year instead of by 5.2 percent per year be attacked as a “slash-and-burn” plan.

The budget also relies on “dynamic scoring.” This trick is where the budget numbers account for increased government revenue generated by economic growth the budget will supposedly unleash. The claims are dubious at best. Of course, reducing government spending will lead to economic growth. But real growth requires real cuts, not this budget’s phony cuts.

As important as reducing spending and balancing the budget is, focusing solely on budget numbers ignores the root of the problem. The real problem is that too many in Washington — and the nation as a whole — refuse to consider any serious reductions in the welfare-warfare state.

I have always maintained that the logical place to start reducing spending is the trillions wasted on our interventionist foreign policy. Unfortunately, there are still too many in Congress who claim to be fiscal hawks when it comes to welfare spending, but turn into Keynesian “doves” when it comes to spending on the military-industrial complex.

These members cling to the mistaken belief that the government can balance its budget, keep taxes low, and even have a growing economy, while spending trillions of dollars policing the world, and propping up some governments and changing others overtly or covertly. Thus, President Obama is attacked as soft on defense because he only wants to spend $5.9 trillion over ten years on the military. In contrast, the Republican budget spends $6.2 trillion over the next decade. That is almost a trillion more than the budget’s total so-called spending cuts.

If there are too many fiscal conservatives who refuse to abandon the warfare state, there are too many liberals who act as if any reduction in welfare or entitlement spending leaves children starving. I agree it is unrealistic to simply end programs that people are currently dependent on. However, isn’t it inhumane to not take steps to unwind the welfare system before government overspending causes a bigger financial crisis and drags millions more into poverty?

Far from abandoning those in need of help, returning the responsibility for caring for the needy to private charities, churches, and local communities will improve the welfare system. At the very least,  young people should have the freedom to choose to pay a lower tax rate in exchange for promising to never participate in a government welfare or entitlement program.

Last week’s budget debate showed how little difference there lies between the parties when it comes to preserving the warfare-welfare state. One side may prefer more warfare while the other prefers more welfare, but neither side actually wants to significantly reduce the size and scope of government. Until Congress stops trying to run the world, run the economy, and run our lives, there will never be a real debate about cutting spending and limiting government.

China’s Monumental Ponzi: Here’s How It Unravels

20 Apr

China is the greatest construction boom and credit bubble in recorded history. An entire nation of 1.3 billion has gone mad building, borrowing, speculating, scheming, cheating, lying and stealing. The source of this demented outbreak is not a flaw in Chinese culture or character—nor even the kind of raw greed and gluttony that afflicts all peoples in the late stages of a financial bubble.

Instead, the cause is monetary madness with a red accent. Chairman Mao was not entirely mistaken when he proclaimed that political power flows from the end of a gun barrel-–he did subjugate a nation of one billion people based on that principle. But it was Mr. Deng’s discovery that saved Mao’s tyrannical communist party regime from the calamity of his foolish post-revolution economic experiments.

Just in the nick of time, as China reeled from the Great Leap Forward, the famine death of 40 million and the mass psychosis of the Cultural Revolution, Mr. Deng learned that power could be maintained and extended from the end of a printing press. And that’s the heart of the so-called China economic miracle. Its not about capitalism with a red accent, as the Wall Street and London gamblers have been braying for nearly two decades; its a monumental case of monetary and credit inflation that has no parallel.

At the turn of the century credit market debt outstanding in the US was about $27 trillion, and we’ve not been slouches attempting to borrow our way to prosperity. Total credit market debt is now $59 trillion—-so America has been burying itself in debt at nearly a 7% annual rate.

But move over America!  As the 21st century dawned, China had about $1 trillion of credit market debt outstanding, but after a blistering pace of “borrow and build” for 14 years it now carries nearly $25 trillion.  But here’s the thing: this stupendous 25X growth of debt occurred in the context of an economic system designed and run by elderly party apparatchiks who had learned their economics from Mao’s Little Red Book!

That means there was no legitimate banking system in China—just giant state bureaus which were run by  party operatives and a modus operandi of parceling out quotas for national credit growth from the top, and then water-falling them down a vast chain of command to the counties, townships and villages.  There have never been any legitimate financial prices in China—all interest rates and FX rates have been pegged and regulated to the decimal point; nor has there ever been any honest accounting either—-loans have been perpetual options to extend and pretend.

And, needless to say, there is no system of financial discipline based on contract law. China’s GDP has grown by $10 trillion dollars during this century alone—that is, there has been a boom across the land that makes the California gold rush appear pastoral by comparison.  Yet in all that frenzied prospecting there have been almost no mistakes, busted camps, empty pans or even personal bankruptcies.  When something has occasionally gone wrong with an “investment” the prospectors have gathered in noisy crowds on the streets and pounded their pans for relief—-a courtesy that the regime has invariably granted.

So in two short decades, China has erected a monumental Ponzi economy that is economically rotten to the core. It has 1.5 billion tons of steel capacity, but ”sell-through” demand of less than half that amount— that is, on-going demand for sheet steel to go into cars and appliances and rebar into replacement construction once the current pyramid building binge finally expires.  The same is true for its cement industry, ship-building, solar and aluminum industries—to say nothing of 70 million empty luxury apartments and vast stretches of over-built highways, fast rail, airports, shopping mails and new cities.

In short, the flip-side of the China’s giant credit bubble is the most massive malinvesment of real economic resources—-labor, raw materials and capital goods—ever known. Effectively, the country-side pig sties have been piled high with copper inventories and the urban neighborhoods with glass, cement and rebar erections that can’t possibly earn an economic return, but all of which has become “collateral” for even more “loans” under the Chinese Ponzi.

China has been on a wild tear heading straight for the economic edge of the planet—-that is, monetary Terra Incognito— based on the circular principle of borrowing, building and borrowing. In essence, it is a giant re-hypothecation scheme where every man’s “debt” become the next man’s “asset”.

Thus, local government’s have meager incomes, but vastly bloated debts based on stupendously over-valued inventories of land. Coal mine entrepreneurs face collapsing prices and revenues, but soaring double digit interest rates on shadow banking loans collateralized by over-valued coal reserves. Shipyards have empty order books, but vast debts collateralized by soon to be idle construction bays. Speculators have collateralized massive stock piles of copper and iron ore at prices that are already becoming ancient history.

So China is on the cusp of the greatest margin call in history. Once asset values starting falling, its pyramids of debt will stand exposed to withering performance failures and melt-downs. Undoubtedly the regime will struggle to keep its printing press prosperity alive for another month or quarter, but the fractures are now gathering everywhere because the credit rampage has been too extreme and hideous. Maybe Zhejiang Xingrun Real Estate which went belly up last week is the final catalyst, but if not there are thousands more to come. Like Mao’s gun barrel, the printing press has a “sell by” date, too

Of the more than US$562 million (RMB3.5 billion) that it owed to debtors, US$112 million was borrowed from 98 private parties with annual interest rates of up to 36%, according to recent revelations from Chinese media. Under that kind of pressure, the only surprise is that the default didn’t happen sooner. The company struggled to find capital for years; the chairman is suspected of borrowing up to US$38.6 million with “fake mortgages.”

But before Xingrun gets branded as China’s worst small, private homebuilder, it’s important to understand how it ended up in the mess in the first place, and what specific factors brought the operation down, or at least to the brink of collapse (local government officials insist it hasn’t officially defaulted yet).

Xingrun’s business in Fenghua, a county-level city that is part of Ningbo in a manufacturing belt on China’s east coast, ran into trouble through a renovation project starting in 2007, Chinese media pointed out. The company attempted, after securing government support and taking over for another distressed local property company, to build high-rise apartment blocks in a village called Changting. The project required the company to build homes for the original residents before the existing village could be torn down and the new buildings built. Construction was slated to start in the first half of 2012. Xingrun projected that it could pay off its debts within three years.

The project never got to the construction phase. In fact, the small village homes are still standing. Xingrun built the replacement homes for the villagers but there’s no sign of its main housing product, high-rises. Nothing has happened because the residents of the village have tangled the project and the company in a lawsuit that has stretched for years.

That explains why Xingrun was unable to pay back its loans. But why has it come so close to keeling over now? Its troubles with the Changting project persisted for years but the company simply rolled over loans and borrowed at high rates from private lenders.

One problem for capital-strapped developers in the Ningbo area is that private lenders no longer want to lend to highly risky companies. In fact, they are calling in their loans. This is just one of the problems afflicting Xingrun. The value of property in some areas of Fenghua is decreasing and that trend has lowered confidence in developers’ ability to pay dizzyingly high interest rates.

Banks aren’t hot on lending to this kind of developer either. In the past, a developer such as Xingrun could ask the local branch of a commercial bank for more credit. The local branch would take that risk because loan officers there knew that, somewhere much higher up the chain, officials promoted the lending.

That support exists no longer. Now, when small developers beg local banks for credit, they will likely be turned away. Local bank managers are reportedly being told that they may lend to risky borrowers if they wish, but they will be held accountable.

High risk is something no one seems willing to stomach these days – in stark contrast to just a year ago.

headshotFenghua is a small town, and Xingrun’s reach beyond that area is limited. Analysts have come out strong in saying that such a default has little systemic risk. The bigger picture in the region, however, can’t be ignored.

Xingrun’s woes are still the woes of the local authorities. The default will add US$305 million (RMB1.9 billion) to Fenghua province’s non-performing loan portfolio, pushing up the rate of toxic assets to 5.27% and making it Zhejiang province’s most indebted government, according to calculations by The Economic Observer newspaper.

Add Fenghua’s problems to those of the greater Ningbo region. The area reportedly has at least six years of housing stock either sitting empty or under construction. The massive buildout will put small developers under great pressure to pay back loans, especially if private debtors are calling in high-interest loans. A slowdown in property prices won’t help either. Without a rescue from provincial-level banks, Fenghua won’t be the last local government stuck in a jam.

Reprinted with permission from David Stockman.

 

ALL WARS ARE BANKERS’ WARS!

20 Apr

By Michael Rivero

 

“Banking was conceived in iniquity and was born in sin. The Bankers own the Earth. Take it away from them, but leave them the power to create deposits, and with the flick of a pen they will create enough deposits to buy it back again. However, take it away from them, and all the fortunes like mine will disappear, and they ought to disappear, for this world would be a happier and better world to live in. But if you wish to remain slaves of the Bankers and pay for the cost of your own slavery, let them continue to create deposits.” — Sir Josiah Stamp, President of the Bank of England in the 1920s, the second richest man in Britain

I know many people have a great deal of difficulty comprehending just how many wars are started for no other purpose than to force private central banks onto nations, so let me share a few examples, so that you understand why the US Government is mired in so many wars against so many foreign nations. There is ample precedent for this.

The United States fought the American Revolution primarily over King George III’s Currency act, which forced the colonists to conduct their business only using printed bank notes borrowed from the Bank of England at interest.

 

“The bank hath benefit of interest on all moneys which it creates out of nothing.” — William Paterson, founder of the Bank of England in 1694

After the revolution, the new United States adopted a radically different economic system in which the government issued its own value-based money, so that private banks like the Bank of England were not siphoning off the wealth of the people through interest-bearing bank notes.

“The refusal of King George 3rd to allow the colonies to operate an honest money system, which freed the ordinary man from the clutches of the money manipulators, was probably the prime cause of the revolution.” — Benjamin Franklin, Founding Father

Following the revolution, the US Government actually took steps to keep the bankers out of the new government!

 

“Any person holding any office or any stock in any institution in the nature of a bank for issuing or discounting bills or notes payable to bearer or order, cannot be a member of the House whilst he holds such office or stock.” — Third Congress of the United States Senate, 23rd of December, 1793, signed by the President, George Washington

But bankers are nothing if not dedicated to their schemes to acquire your wealth, and know full well how easy it is to corrupt a nation’s leaders. Just one year after Mayer Amschel Rothschild had uttered his infamous “Let me issue and control a nation’s money and I care not who makes the laws”, the bankers succeeded in setting up a new Private Central Bank called the First Bank of the United States, largely through the efforts of the Rothschild’s chief US supporter, Alexander Hamilton. Founded in 1791, by the end of its twenty year charter the First Bank of the United States had almost ruined the nation’s economy, while enriching the bankers. Congress refused to renew the charter and signaled their intention to go back to a state issued value based currency on which the people paid no interest at all to any banker. This resulted in a threat from Nathan Mayer Rothschild against the US Government, “Either the application for renewal of the charter is granted, or the United States will find itself involved in a most disastrous war.” Congress still refused to renew the charter for the First Bank of the United States, whereupon Nathan Mayer Rothschild railed, “Teach those impudent Americans a lesson! Bring them back to colonial status!” The British Prime Minister at the time, Spencer Perceval was adamently opposed to war with the United States, primarily because the majority of England’s military might was occupied with the ongoing Napoleonic wars. Spencer Perceval was concerned that Britain might not prevail in a new American war, a concern shared by many in the British government. Then, Spencer Perceval was assassinated (the only British Prime Minister to be assassinated in office) and replaced by Robert Banks Jenkinson, the 2nd Earl of Liverpool, who was fully supportive of a war to recapture the colonies.


Click for larger image of the Geneva Gazette for July 1, 1912, reporting on the assassination of Spencer Perceval together with the declaration of the War of 1812.

 

 

“If my sons did not want wars, there would be none.” — Gutle Schnaper, wife of Mayer Amschel Rothschild and mother of his five sons

Financed at virtually no interest by the Rothschild controlled Bank of England, Britain then provoked the war of 1812 to recolonize the United States and force them back into the slavery of the Bank of England, or to plunge the United States into so much debt they would be forced to accept a new private central bank. And the plan worked. Even though the War of 1812 was won by the United States, Congress was forced to grant a new charter for yet another private bank issuing the public currency as loans at interest, the Second Bank of the United States. Once again, private bankers were in control of the nation’s money supply and cared not who made the laws or how many British and American soldiers had to die for it.

Once again the nation was plunged into debt, unemployment, and poverty by the predations of the private central bank, and in 1832 Andrew Jackson successfully campaigned for his second term as President under the slogan, “Jackson And No Bank!” True to his word, Jackson succeeds in blocking the renewal of the charter for the Second Bank of the United States.

“Gentlemen! I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out, and by the Eternal, (bringing his fist down on the table) I will rout you out!” — Andrew Jackson, shortly before ending the charter of the Second Bank of the United States. From the original minutes of the Philadelphia committee of citizens sent to meet with President Jackson (February 1834), according to Andrew Jackson and the Bank of the United States (1928) by Stan V. Henkels

Shortly after President Jackson (the only American President to actually pay off the National Debt) ended the Second Bank of the United States, there was an attempted assassination which failed when both pistols used by the assassin, Richard Lawrence, failed to fire. Lawrence later said that with Jackson dead, “Money would be more plenty.”

President Zachary Taylor opposed the creation of a new Private Central Bank, owing to the historical abuses of the First and Second Banks of the United States.

“The idea of a national bank is dead, and will not be revived in my time.” — Zachary Taylor

Taylor died on July 9, 1850 after eating a bowl of cherries and milk rumored to have been poisoned. The symptoms h displayed are consistent with acute arsenic poisoning.

President James Buchanan also opposed a private central bank. During the panic of 1857 he attempted to set limits on banks issuing more loans than they had actual funds, and to require all issued bank notes to be backed by Federal Government assets. He was poisoned with arsenic and survived, although 38 other people at the dinner died.

Of course, the public school system is as subservient to the bankers’ wishes to keep certain history from you, just as the corporate media is subservient to Monsanto’s wishes to keep the dangers of GMOs from you, and the global warming cult’s wishes to conceal from you that the Earth has actually been cooling for the last 16 years. Thus is should come as little surprise that much of the real reasons for the events of the Civil War are not well known to the average American.

 

“The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.” — The Rothschild brothers of London writing to associates in New York, 1863

When the Confederacy seceded from the United States, the bankers once again saw the opportunity for a rich harvest of debt, and offered to fund Lincoln’s efforts to bring the south back into the union, but at 30% interest. Lincoln remarked that he would not free the black man by enslaving the white man to the bankers and using his authority as President, issued a new government currency, the greenback. This was a direct threat to the wealth and power of the central bankers, who quickly responded.

“If this mischievous financial policy, which has its origin in North America, shall become endurated down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and be without debt. It will have all the money necessary to carry on its commerce. It will become prosperous without precedent in the history of the world. The brains, and wealth of all countries will go to North America. That country must be destroyed or it will destroy every monarchy on the globe.” — The London Times responding to Lincoln’s decision to issue government Greenbacks to finance the Civil War,rather than agree to private banker’s loans at 30% interest.

In 1872 New York bankers sent a letter to every bank in the United States, urging them to fund newspapers that opposed government-issued money (Lincoln’s greenbacks).

“Dear Sir: It is advisable to do all in your power to sustain such prominent daily and weekly newspapers… as will oppose the issuing of greenback paper money, and that you also withhold patronage or favors from all applicants who are not willing to oppose the Government issue of money. Let the Government issue the coin and the banks issue the paper money of the country… [T]o restore to circulation the Government issue of money, will be to provide the people with money, and will therefore seriously affect your individual profit as bankers and lenders.” — Triumphant plutocracy; the story of American public life from 1870 to 1920, by Lynn Wheeler

“It will not do to allow the greenback, as it is called, to circulate as money any length of time, as we cannot control that.” — Triumphant plutocracy; the story of American public life from 1870 to 1920, by Lynn Wheeler

“Slavery is likely to be abolished by the war power, and chattel slavery destroyed. This, I and my European friends are in favor of, for slavery is but the owning of labor and carries with it the care for the laborer, while the European plan, led on by England, is for capital to control labor by controlling the wages. THIS CAN BE DONE BY CONTROLLING THE MONEY.” — Triumphant plutocracy; the story of American public life from 1870 to 1920, by Lynn Wheeler

Goaded by the private bankers, much of Europe supported the Confederacy against the Union, with the expectation that victory over Lincoln would mean the end of the Greenback. France and Britain considered an outright attack on the United States to aid the confederacy, but were held at bay by Russia, which had just ended the serfdom system and had a state central bank similar to the system the United States had been founded on. Left free of European intervention, the Union won the war, and Lincoln announced his intention to go on issuing greenbacks. Following Lincoln’s assassination, the Greenbacks were pulled from circulation and the American people forced to go back to an economy based on bank notes borrowed at interest from the private bankers. Tsar Alexander II, who authorized Russian militarey assistance to Lincoln, was subsequently the victim of multiple attempts on his life in 1866, 1879, and 1880, until his assassination in 1881.

James A. Garfield was elected President in 1880 on a platform of government control of the money supply.

 

“The chief duty of the National Government in connection with the currency of the country is to coin money and declare its value. Grave doubts have been entertained whether Congress is authorized by the Constitution to make any form of paper money legal tender. The present issue of United States notes has been sustained by the necessities of war; but such paper should depend for its value and currency upon its convenience in use and its prompt redemption in coin at the will of the holder, and not upon its compulsory circulation. These notes are not money, but promises to pay money. If the holders demand it, the promise should be kept. — James Garfield

 

“By the experience of commercial nations in all ages it has been found that gold and silver afford the only safe foundation for a monetary system. Confusion has recently been created by variations in the relative value of the two metals, but I confidently believe that arrangements can be made between the leading commercial nations which will secure the general use of both metals. Congress should provide that the compulsory coinage of silver now required by law may not disturb our monetary system by driving either metal out of circulation. If possible, such an adjustment should be made that the purchasing power of every coined dollar will be exactly equal to its debt-paying power in all the markets of the world. –James Garfield

 

“He who controls the money supply of a nation controls the nation. — James Garfield

Garfield was shot on July 2, 1881 and died of his wounds several weeks later. Chester A. Arthur succeeded Garfield as President.

In 1896, William McKinley was elected President in the middle of a depression-driven debate over gold-backed government currency versus bank notes borrowed at interest from private banks. McKinley favored gold-backed currencies and a balanced government budget which would free the public from accumulating debt.

 

“Our financial system needs some revision; our money is all good now, but its value must not further be threatened. It should all be put upon an enduring basis, not subject to easy attack, nor its stability to doubt or dispute. Our currency should continue under the supervision of the Government. The several forms of our paper money offer, in my judgment, a constant embarrassment to the Government and a safe balance in the Treasury.” — William McKinley

McKinley was shot by an out-of-work anarchist on September 14, 1901, in Buffalo, NY, succumbing to his wounds a few days later. He was suceeded in office by Theodore Roosevelt.

Finally, in 1913, the Private Central Bankers of Europe, in particular the Rothschilds of Great Britain and the Warburgs of Germany, met with their American financial collaborators on Jekyll Island, Georgia to form a new banking cartel with the express purpose of forming the Third Bank of the United States, with the aim of placing complete control of the United States money supply once again under the control of private bankers. Owing to hostility over the previous banks, the name was changed to “The Federal Reserve” system in order to grant the new bank a quasi-governmental image, but in fact it is a privately owned bank, no more “Federal” than Federal Express. Indeed, in 2012, the Federal Reserve attempted to rebuff a Freedom of Information Lawsuit by Bloomberg News on the grounds that as a private banking corporation and not actually a part of the government, the Freedom of Information Act did not apply to the “trade secret” operations of the Federal Reserve.

 

“When you or I write a check, there must be sufficient funds in our account to cover the check; but when the Federal Reserve writes a check, there is no bank deposit on which that check is drawn. When the Federal Reserve writes a check, it is creating money.” — From the Boston Federal Reserve Bank pamphlet, “Putting it Simply.”

 

“Neither paper currency nor deposits have value as commodities. Intrinsically, a ‘dollar’ bill is just a piece of paper. Deposits are merely book entries.” — “Modern Money Mechanics Workbook” � Federal Reserve of Chicago, 1975

 

“I am afraid the ordinary citizen will not like to be told that the banks can and do create money. And they who control the credit of the nation direct the policy of Governments and hold in the hollow of their hand the destiny of the people.” — Reginald McKenna, as Chairman of the Midland Bank, addressing stockholders in 1924

 

“States, most especially the large hegemonic ones, such as the United States and Great Britain, are controlled by the international central banking system, working through secret agreements at the Bank for International Settlements (BIS), and operating through national central banks (such as the Bank of England and the Federal Reserve)… The same international banking cartel that controls the United States today previously controlled Great Britain and held it up as the international hegemon. When the British order faded, and was replaced by the United States, the US ran the global economy. However, the same interests are served. States will be used and discarded at will by the international banking cartel; they are simply tools.” — Andrew Gavin Marshall

1913 proved to be a transformative year for the nation’s economy, first with the passage of the 16th “income tax” Amendment and the false claim that it had been ratified.

“I think if you were to go back and and try to find and review the ratification of the 16th amendment, which was the internal revenue, the income tax, I think if you went back and examined that carefully, you would find that a sufficient number of states never ratified that amendment.” – U.S. District Court Judge James C. Fox, Sullivan Vs. United States, 2003.

Later that same year, and apparently unwilling to risk another questionable amendment, Congress passed the Federal Reserve Act over Christmas holiday 1913, while members of Congress opposed to the measure were at home. This was a very underhanded deal, as the Constitution explicitly vests Congress with the authority to issue the public currency, does not authorize its delegation, and thus should have required a new Amendment to transfer that authority to a private bank. But pass it Congress did, and President Woodrow Wilson signed it as he promised the bankers he would in exchange for generous campaign contributions. Wilson later regretted that decision.

 

“I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is now controlled by its system of credit. We are no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.” — Woodrow Wilson 1919

The next year, World War One started, and it is important to remember that prior to the creation of the Federal Reserve, there was no such thing as a world war.

 

World War One started between Austria-Hungary and Serbia, but quickly shifted to focus on Germany, whose industrial capacity was seen as an economic threat to Great Britain, who saw the decline of the British Pound as a result of too much emphasis on financial activity to the neglect of agriculture, industrial development, and infrastructure (not unlike the present day United States). Although pre-war Germany had a private central bank, it was heavily restricted and inflation kept to reasonable levels. Under government control, investment was guaranteed to internal economic development, and Germany was seen as a major power. So, in the media of the day, Germany was portrayed as the prime opponent of World War One, and not just defeated, but its industrial base flattened. Following the Treaty of Versailles, Germany was ordered to pay the war costs of all the participating nations, even though Germany had not actually started the war. This amounted to three times the value of all of Germany itself. Germany’s private central bank, to whom Germany had gone deeply into debt to pay the costs of the war, broke free of government control, and massive inflation followed (mostly triggered by currency speculators) , permanently trapping the German people in endless debt.

When the Weimar Republic collapsed economically, it opened the door for the National Socialists to take power. Their first financial move was to issue their own state currency which was not borrowed from private central bankers. Freed from having to pay interest on the money in circulation, Germany blossomed and quickly began to rebuild its industry. The media called it “The German Miracle”. TIME magazine lionized Hitler for the amazing improvement in life for the German people and the explosion of German industry, and even named him TIME Magazine’s Man Of The Year in 1938.

 

 

Once again, Germany’s industrial output became a threat to Great Britain.

“Should Germany merchandise (do business) again in the next 50 years we have led this war (WW1) in vain.” – Winston Churchill in The Times (1919) 

“We will force this war upon Hitler, if he wants it or not.” – Winston Churchill (1936 broadcast)

“Germany becomes too powerful. We have to crush it.” – Winston Churchill (November 1936 speaking to US – General Robert E. Wood)

“This war is an English war and its goal is the destruction of Germany.” – Winston Churchill (- Autumn 1939 broadcast)

 

Germany’s state-issued value based currency was also a direct threat to the wealth and power of the private central banks, and as early as 1933 they started to organize a global boycott against Germany to strangle this upstart ruler who thought he could break free of private central bankers!

 


Click for larger image
 

As had been the case in World War One, Great Britain and other nations threatened by Germany’s economic power looked for an excuse to go to war, and as public anger in Germany grew over the boycott, Hitler foolishly gave them that excuse. Years later, in a spirit of candor, the real reasons for that war were made clear.

“The war wasn’t only about abolishing fascism, but to conquer sales markets. We could have, if we had intended so, prevented this war from breaking out without doing one shot, but we didn’t want to.”– Winston Churchill to Truman (Fultun, USA March 1946) 

 

“Germany’s unforgivable crime before WW2 was its attempt to loosen its economy out of the world trade system and to build up an independent exchange system from which the world-finance couldn’t profit anymore. …We butchered the wrong pig.” -Winston Churchill (The Second World War – Bern, 1960)

As a side note, we need to step back before WW2 and recall Marine Major General Smedley Butler. In 1933, Wall Street bankers and financiers had bankrolled the successful coups by both Hitler and Mussolini. Brown Brothers Harriman in New York was financing Hitler right up to the day war was declared with Germany. And they decided that a fascist dictatorship in the United States based on the one on Italy would be far better for their business interests than Roosevelt’s “New Deal” which threatened massive wealth re-distribution to recapitalize the working and middle class of America. So the Wall Street tycoons recruited General Butler to lead theoverthrow of the US Government and install a “Secretary of General Affairs” who would be answerable to Wall Street and not the people, would crush social unrest and shut down all labor unions. General Butler pretended to go along with the scheme but then exposed the plot to Congress. Congress, then as now in the pocket of the Wall Street bankers, refused to act. When Roosevelt learned of the planned coup he demanded the arrest of the plotters, but the plotters simply reminded Roosevelt that if any one of them were sent to prison, their friends on Wall Street would deliberatly collapse the still-fragile economy and blame Roosevelt for it. Roosevelt was thus unable to act until the start of WW2, at which time he prosecuted many of the plotters under the Trading With The Enemy act. The Congressional minutes into the coup were finally released in 1967 and became the inspiration for the movie, “Seven Days in May” but with the true financial villains erased from the script.

“I spent 33 years and four months in active military service as a member of our country’s most agile military force — the Marine Corps. I served in all commissioned ranks from second lieutenant to Major General. And during that period I spent more of my time being a high–class muscle man for Big Business, for Wall Street and for the bankers. In short, I was a racketeer, a gangster for capitalism. “I suspected I was just a part of a racket at the time. Now I am sure of it. Like all members of the military profession I never had an original thought until I left the service. My mental faculties remained in suspended animation while I obeyed the orders of the higher-ups. This is typical with everyone in the military service. Thus I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. The record of racketeering is long. I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-12. I brought light to the Dominican Republic for American sugar interests in 1916. In China in 1927 I helped see to it that the Standard Oil went its way unmolested. During those years, I had, as the boys in the back room would say, a swell racket. I was rewarded with honors, medals and promotion. Looking back on it, I feel I might have given Al Capone a few hints. The best he could do was to operate his racket in three city districts. I operated on three continents.” — General Smedley Butler, former US Marine Corps Commandant,1935

 

As President, John F. Kennedy understood the predatory nature of private central banking. He understood why Andrew Jackson fought so hard to end the Second Bank of the United States. So Kennedy wrote and signed Executive Order 11110 which ordered the US Treasury to issue a new public currency, the United States Note.

 


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Kennedy’s United States Notes were not borrowed form the Federal Reserve but created by the US Government and backed by the silver stockpiles held by the US Government. It represented a return to the system of economics the United States had been founded on, and was perfectly legal for Kennedy to do. All told, some four and one half billion dollars went into public circulation, eroding interest payments to the Federal Reserve and loosening their control over the nation. Five months later John F. Kennedy was assassinated in Dallas Texas, and the United States Notes pulled from circulation and destroyed (except for samples held by collectors). John J. McCloy, President of the Chase Manhattan Bank, and President of the World Bank, was named to the Warren Commission, presumably to make certain the banking dimensions behind the assassination were concealed from the public.

As we enter the eleventh year of what future history will most certainly describe as World War Three, we need to examine the financial dimensions behind the wars.

Towards the end of World War Two, when it became obvious that the allies were going to win and dictate the post war environment, the major world economic powers met at Bretton Woods, a luxury resort in New Hampshire in July of 1944, and hammered out the Bretton Woods agreement for international finance. The British Pound lost its position as the global trade and reserve currency to the US dollar (part of the price demanded by Roosevelt in exchange for the US entry into the war). Absent the economic advantages of being the world’s “go-to” currency, Britain was forced to nationalize the Bank of England in 1946. The Bretton Woods agreement, ratified in 1945, in addition to making the dollar the global reserve and trade currency, obligated the signatory nations to tie their currencies to the dollar. The nations that ratified Bretton Woods did so on two conditions. The first was that the Federal Reserve would refrain from over-printing the dollar as a means to loot real products and produce from other nations in exchange for ink and paper; basically an imperial tax. That assurance was backed up by the second requirement, which was that the US dollar would always be convertible to gold at $35 per ounce.

Of course, the Federal Reserve, being a private bank and not answerable to the US Government, did start overprinting paper dollars, and much of the perceived prosperity of the 1950s and 1960s was the result of foreign nations’ obligations to accept the paper notes as being worth gold at the rate of $35 an ounce. Then in 1970, France looked at the huge pile of paper notes sitting in their vaults, for which real French products like wine and cheese had been traded, and notified the United States government that they would exercise their option under Bretton Woods to return the paper notes for gold at the $35 per ounce exchange rate. Of course, the United States had nowhere near the gold to redeem the paper notes, so on August 15th, 1971, Richard Nixon “temporarily” suspended the gold convertibility of the US Federal Reserve Notes. This “Nixon shock” effectively ended Bretton Woods and many global currencies started to delink from the US dollar. Worse, since the United States had collateralized their loans with the nation’s gold reserves, it quickly became apparent that the US Government did not in fact have enough gold to cover the outstanding debts. Foreign nations began to get very nervous about their loans to the US and understandably were reluctant to loan any additional money to the United States without some form of collateral. So Richard Nixon started the environmental movement, with the EPA and its various programs such as “wilderness zones”, Roadless areas”, Heritage rivers”, “Wetlands”, all of which took vast areas of public lands and made them off limits to the American people who were technically the owners of those lands. But Nixon had little concern for the environment and the real purpose of this land grab under the guise of the environment was to pledge those pristine lands and their vast mineral resources as collateral on the national debt. The plethora of different programs was simply to conceal the true scale of how much American land was being pledged to foreign lenders as collateral on the government’s debts; eventually almost 25% of the nation itself.

 

click for full size imageWith open lands for collateral already in short supply, the US Government embarked on a new program to shore up sagging international demand for the dollar. The United States approached the world’s oil producing nations, mostly in the Middle East, and offered them a deal. In exchange for only selling their oil for dollars, the United States would guarantee the military safety of those oil-rich nations. The oil rich nations would agree to spend and invest their US paper dollars inside the United States, in particular in US Treasury Bonds, redeemable through future generations of US taxpayers. The concept was labeled the “petrodollar”. In effect, the US, no longer able to back the dollar with gold, was now backing it with oil. Other peoples’ oil. And that necessity to keep control over those oil nations to prop up the dollar has shaped America’s foreign policy in the region ever since.

But as America’s manufacturing and agriculture has declined, the oil producing nations faced a dilemma. Those piles of US Federal Reserve notes were not able to purchase much from the United States because the United States had little (other than real estate) anyone wanted to buy. Europe’s cars and aircraft were superior and less costly, while experiments with GMO food crops led to nations refusing to buy US food exports. Israel’s constant belligerence against its neighbors caused them to wonder if the US could actually keep their end of the petrodollar arrangement. Oil producing nations started to talk of selling their oil for whatever currency the purchasers chose to use. Iraq, already hostile to the United States following Desert Storm, demanded the right to sell their oil for Euros in 2000 and in 2002, the United Nations agreed to allow it under the “Oil for food” program instituted following Desert Storm. One year later the United States re-invaded Iraq, lynched Saddam Hussein, and placed Iraq’s oil back on the world market only for US dollars.

The clear US policy shift following 9-11, away from being an impartial broker of peace in the Mideast to one of unquestioned support for Israel’s aggressions only further eroded confidence in the Petrodollar deal and even more oil producing nations started openly talking of oil trade for other global currencies.

Over in Libya, Muammar Gaddafi had instituted a state-owned central bank and a value based trade currency, the Gold Dinar. Gaddafi announced that Libya’s oil was for sale, but only for the Gold Dinar. Other African nations, seeing the rise of the Gold Dinar and the Euro, even as the US dollar continued its inflation-driven decline, flocked to the new Libyan currency for trade. This move had the potential to seriously undermine the global hegemony of the dollar. French President Nicolas Sarkozy reportedly went so far as to call Libya a “threat” to the financial security of the world. So, the United States invaded Libya, brutally murdered Qaddafi ( the object lesson of Saddam’s lynching not being enough of a message, apparently), imposed a private central bank, and returned Libya’s oil output to dollars only. The gold that was to have been made into the Gold Dinars is, as of last report, unaccounted for.

According to General Wesley Clark, the master plan for the “dollarification” of the world’s oil nations included seven targets, Iraq, Syria, Lebanon, Libya, Somalia, Sudan, and Iran (Venezuela, which dared to sell their oil to China for the Yuan, is a late addition). What is notable about the original seven nations originally targeted by the US is that none of them are members of the Bank for International Settlements, the private central bankers private central bank, located in Switzerland. This meant that these nations were deciding for themselves how to run their nations’ economies, rather than submit to the international private banks.

Now the bankers’ gun sights are on Iran, which dares to have a government central bank and sell their oil for whatever currency they choose. The war agenda is, as always, to force Iran’s oil to be sold only for dollars and to force them to accept a privately owned central bank. Malaysia, one of the new nations without a Rothschild central bank, is now being invaded by a force claimed to be “Al Qaeda”, and with the death of President Hugo Chavez, plans to impose a US and banker friendly regime on Venezuela are clearly being implemented.

The German government recently asked for the return of some of their gold bullion from the Bank of France and the New York Federal Reserve. France has said it will take 5 years to return Germany’s gold. The United States has said they will need 8 years to return Germany’s gold. This suggests strongly that the Bank of France and the NY Federal Reserve have used the deposited gold for other purposes, most likely to cover gold futures contracts used to artificially suppress the price of gold to keep investors in the equities markets, and the Central Banks are scrambling to find new gold to cover the shortfall and prevent a gold run. So it is inevitable that suddenly France invades Mali, ostensibly to combat Al Qaeda, with the US joining in. Mali just happens to be one of the world’s largest gold producers with gold accounting for 80% of Mali exports. War for the bankers does not get more obvious than that!

Mexico has demanded a physical audit of their gold bullion stored at the Bank of England, and along with Venezuela’s vast oil reserves (larger than Saudi Arabia), Venezuela’s gold mines are a prize lusted after by all the Central Banks that played fast and loose with other peoples’ gold bullion. So we can expect regime change if not outright invasion soon.

You have been raised by a public school system and media that constantly assures you that the reasons for all these wars and assassinations are many and varied. The US claims to bring democracy to the conquered lands (they haven’t; the usual result of a US overthrow is the imposition of a dictatorship, such as the 1953 CIA overthrow of Iran’s democratically elected government of Mohammad Mosaddegh and the imposition of the Shah, or the 1973 CIA overthrow of Chile’s democratically elected government of President Salvador Allende, and the imposition of Augusto Pinochet), or to save a people from a cruel oppressor, revenge for 9-11, or that tired worn-out catch all excuse for invasion, weapons of mass destruction. Assassinations are always passed off as “crazed lone nuts” to obscure the real agenda.

The real agenda is simple. It is enslavement of the people by creation of a false sense of obligation. That obligation is false because the Private Central Banking system, by design, always creates more debt than money with which to pay that debt. Private Central Banking is not science, it is a religion; a set of arbitrary rules created to benefit the priesthood, meaning the owners of the Private Central Bank. The fraud persists, with often lethal results, because the people are tricked into believing that this is the way life is suppoed to be and no alternative exists or should be dreamt of. The same was true of two earlier systems of enslavement, Rule by Divine Right and Slavery, both systems built to trick people into obedience, and both now recognized by modern civilizatyion as illegitimate. Now we are entering a time in human history where we will recognize that rule by debt, or rule by Private Central Bankers issuing the public currency as a loan at interest, is equally illegitimate. It only works as long as people allow themselves to believe that this is the way life is supposed to be.

 

But understand this above all; Private Central Banks do not exist to serve the people, the community, or the nation. Private Central Banks exist to serve their owners, to make them rich beyond the dreams of Midas and all for the cost of ink, paper, and the right bribe to the right official.

Behind all these wars, all these assassinations, the hundred million horrible deaths from all the wars lies a single policy of dictatorship. The private central bankers allow rulers to rule only on the condition that the people of a nation be enslaved to the private central banks. Failing that, said ruler will be killed, and their nation invaded by those other nations enslaved to private central banks.

The so-called “clash of civilizations” we read about on the corporate media is really a war between banking systems, with the private central bankers forcing themselves onto the rest of the world, no matter how many millions must die for it. Indeed the constant hatemongering against Muslims lies in a simple fact. Like the ancient Christians (prior to the Knights Templars private banking system) , Muslims forbid usury, or the lending of money at interest. And that is the reason our government and media insist they must be killed or converted. They refuse to submit to currencies issued at interest. They refuse to be debt slaves.

So off to war your children must go, to spill their blood for the money-junkies’ gold. We barely survived the last two world wars. In the nuclear/bioweapon age, are the private central bankers willing to risk incinerating the whole planet just to feed their greed?

Apparently so.

This brings us to the current situation in the Ukraine.

The European Union had been courting the government of the Ukraine to merge with the EU, and more to the point, entangle their economy with the private-owned European Central Bank. The government of the Ukraine was considering the move, but had made no commitments. Part of their concern lay with the conditions in other EU nations enslaved to the ECB, notably Cyprus, Greece, Spain, and Italy. So they were properly cautious. Then Russia stepped in with a better deal and the Ukraine, exercising the basic choice all consumers have to choose the best product at the best price, dropped the EU and announced they were going to go with Russia’s offer. It was at that point that agents provocateurs flooded into the Ukraine, covertly funded by intelligence agency fronts like CANVAS and USAID, stirring up trouble, while the western media proclaimed this was a popular revolution. Snipers shot at people and this violence was blamed on then-President Yanukovich. However a leaked recording of a phone call between the EU’s Catherine Ashton and Estonia’s Foreign Minister Urmas Paet confirmed the snipers were working for the overthrow plotters, not the Ukrainian government. Urmas Paet has confirmed the authenticity of that phone call.

This is a classic pattern of covert overthrow we have seen many times before. Since the end of WW2, the US has covertly tried to overthrow the governments of 56 nations, succeeding 25 times. Examples include the 1953 overthrow of Iran’s elected government of Mohammed Mossadegh and the imposition of the Shah, the 1973 overthrow of Chile’s elected government of Salvador Allende and the imposition of the Pinochet dictatorship, and of course, the current overthrow of Ukraine’s elected government of Yanukovich and the imposition of the current unelected government, which is already gutting the Ukraine’s wealth to hand to the western bankers.

 

Flag waving and propaganda aside, all modern wars are wars by and for the private bankers, fought and bled for by third parties unaware of the true reason they are expected to gracefully be killed and croppled for. The process is quite simple. As soon as the Private Central Bank issues its currency as a loan at interest, the public is forced deeper and deeper into debt. When the people are reluctant to borrow any more, that is when the Keynesian economists demand the government borrow more to keep the pyramid scheme working. When both the people and government refuse to borrow any more, that is when wars are started, to plunge everyone even deeper into debt to pay for the war, then after the war to borrow more to rebuild. When the war is over, the people have about the same as they did before the war, except the graveyards are far larger and everyone is in debt to the private bankers for the next century. This is why Brown Brothers Harriman in New York was funding the rise of Adolf Hitler.

As long as Private Central Banks are allowed to exist, inevitably as the night follows day there will be poverty, hopelessness, and millions of deaths in endless World Wars, until the Earth itself is sacrificed in flames to Mammon.

The path to true peace on Earth lies in the abolishment of all private central banking everywhere, and a return to the state-issued value-based currencies that allow nations and people to become prosperous.

 

“Banks do not have an obligation to promote the public good.” — Alexander Dielius, CEO, Germany, Austrian, Eastern Europe Goldman Sachs, 2010

 

“I am just a banker doing God’s work.” — Lloyd Blankfein, CEO, Goldman Sachs, 2009

 


 


 


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Other articles by Michael Rivero on the fraud of Private Central Banking. 

THE ELEVENTH MARBLE 

HOW YOU BECAME A SLAVE TO THE BANKERS! 

Awaken slaves! – How The Private Central Bank Ponzi Scheme Trapped And Destroyed America 

THE FATAL FLAWS IN WALL STREET’S ECONOMIC THEORY 

BANKERS GONE WILD – HOW THE US GOVERNMENT HELPED WALL STREET GANG-RAPE AMERICA’S MIDDLE CLASS (AND MOST OF EUROPE)