Why The Rich Pay Lower Taxes

Buckminster Fuller - Best Interview (1974)

100 Years Is Enough: Time to Make the Fed a Public Utility - By Ellen Brown/Web of Debt

100 Years Is Enough: Time to Make the Fed a Public Utility

By Ellen Brown/Web of Debt

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December 23rd, 2013, marks the 100^th anniversary of the Federal Reserve, warranting a review of its performance.  Has it achieved the purposes for which it was designed?

The answer depends on whose purposes we are talking about.  For the banks, the Fed has served quite well.  For the laboring masses whose populist movement prompted it, not much has changed in a century.

Thwarting Populist Demands

The Federal Reserve Act was passed in 1913 in response to a wave of bank crises, which had hit on average every six years over a period of 80 years. The resulting economic depressions triggered a populist movement for monetary reform in the 1890s.  Mary Ellen Lease, an early populist leader, said in a fiery speech that could have been written today:

Wall Street owns the country. It is no longer a government of the people, by the people, and for the people, but a government of Wall Street, by Wall Street, and for Wall Street. The great common people of this country are slaves, and monopoly is the master. . . . Money rules . . . .Our laws are the output of a system which clothes rascals in robes and honesty in rags. The parties lie to us and the political speakers mislead us. . . .

We want money, land and transportation. We want the abolition of the National Banks, and we want the power to make loans direct from the government. We want the foreclosure system wiped out.

That was what they wanted, but the Federal Reserve Act that they got was not what the populists had fought for, or what their leader William Jennings Bryan thought he was approving when he voted for it in 1913. In the stirring speech that won him the Democratic presidential nomination in 1896, Bryan insisted:

[We] believe that the right to coin money and issue money is a function of government. . . . Those who are opposed to this proposition tell us that the issue of paper money is a function of the bank and that the government ought to go out of the banking business. I stand with Jefferson . . . and tell them, as he did, that the issue of money is a function of the government and that the banks should go out of the governing business.

He concluded with this famous outcry against the restrictive gold standard:

You shall not press down upon the brow of labor this crown of thorns, you shall not crucify mankind upon a cross of gold.

What Bryan and the populists sought was a national currency issued debt-free and interest-free by the government, on the model of Lincoln’s Greenbacks. What the American people got was a money supply created by private banks as credit (or debt) lent to the government and the people at interest. Although the national money supply would be printed by the U.S. Bureau of Engraving and Printing, it would be issued by the “bankers’ bank,” the Federal Reserve. The Fed is composed of twelve branches, all of which are 100 percent owned by the banks in their districts. Until 1935, these branches could each independently issue paper dollars for the cost of printing them, and could lend them at interest.

1929: The Fed Triggers the Worst Bank Run in History

The new system was supposed to prevent bank runs, but it clearly failed in that endeavor. In 1929, the United States experienced the worst bank run in its history.

The New York Fed had been pouring newly-created money into New York banks, which then lent it to stock speculators. When the New York Fed heard that the Federal Reserve Board of Governors had held an all-night meeting discussing this risky situation, the flood of speculative funding was retracted, precipitating the 1929 stock market crash.

At that time, paper dollars were freely redeemable in gold; but banks were required to keep sufficient gold to cover only 40 percent of their deposits. When panicked bank customers rushed to cash in their dollars, gold reserves shrank. Loans then had to be recalled to maintain the 40 percent requirement, collapsing the money supply.

The result was widespread unemployment and loss of homes and savings, similar to that seen today. In a scathing indictment before Congress in 1934, Representative Louis McFadden blamed the Federal Reserve. He said:

Mr. Chairman, we have in this Country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks . . . . The depredations and iniquities of the Fed has cost enough money to pay the National debt several times over. . . .

Some people think that the Federal Reserve Banks are United  States  Government  institutions.  They are private monopolies which prey upon the people of these United States for the benefit of themselves and their foreign customers; foreign and domestic speculators and swindlers; and rich and predatory money lenders.

These twelve private credit monopolies were deceitfully and disloyally foisted upon this Country by the bankers who came here from Europe and repaid us our hospitality by undermining our American institutions.

Freed from the Bankers’ “Cross of Gold”

To stop the collapse of the money supply, in 1933 Roosevelt took the dollar off the gold standard within the United States. The gold standard had prevailed since the founding of the country, and the move was highly controversial. Critics viewed it as a crime. But proponents saw it as finally allowing the country to be economically sovereign.

This more benign view was taken by Beardsley Ruml, Chairman of the Federal Reserve Bank of New York, in a presentation before the American Bar Association in 1945. He said the government was now at liberty to spend as needed to meet its budget, drawing on credit issued by its own central bank. It could do this until price inflation indicated a weakened purchasing power of the currency. Then, and only then, would the government need to levy taxes—not to fund the budget but to counteract inflation by contracting the money supply. The principal purpose of taxes, said Ruml, was “the maintenance of a dollar which has stable purchasing power over the years. Sometimes this purpose is stated as ‘the avoidance of inflation.’”

It was a remarkable realization. The government could be funded without taxes, by drawing on credit from its own central bank. Since there was no longer a need for gold to cover the loan, the central bank would not have to borrow. It could just create the money on its books. Only when prices rose across the board, signaling an excess of money in the money supply, would the government need to tax—not to fund the government but simply to keep supply (goods and services) in balance with demand (money).

Ruml’s vision is echoed today in the school of economic thought called Modern Monetary Theory (MMT). But after Roosevelt’s demise, it was not pursued. The U.S. government continued to fund itself with taxes; and when it failed to recover enough to pay its bills, it continued to borrow, putting itself in debt.

The Fed Agrees to Return the Interest

For its first half century, the Federal Reserve continued to pocket the interest on the money it issued and lent to the government. But in the 1960s, Wright Patman, Chairman of the House Banking and Currency Committee, pushed to have the Fed nationalized. To avoid that result, the Fed quietly agreed to rebate its profits to the U.S. Treasury.

In The Strange Case of Richard Milhous Nixon, published in 1973, Congressman Jerry Voorhis wrote of this concession:

It was done, quite obviously, as acknowledgment that the Federal Reserve Banks were acting on the one hand as a national bank of issue, creating the nation’s money, but on the other hand charging the nation interest on its own credit—which no true national bank of issue could conceivably, or with any show of justice, dare to do.

Rebating the interest to the Treasury was clearly a step in the right direction. But the central bank funded very little of the federal debt. Commercial banks held a large chunk of it; and as Voorhis observed, “[w]here the commercial banks are concerned, there is no such repayment of the people’s money.” Commercial banks did not rebate the interest they collected to the government, said Voorhis, although they also “‘buy’ the bonds with newly created demand deposit entries on their books—nothing more.”

Today the proportion of the federal debt held by the Federal Reserve has shot up, due to repeated rounds of “quantitative easing.” But the majority of the debt is still funded privately at interest, and most of the dollars funding it originated as “bank credit”created on the books of private banks.

Time for a New Populist Movement?

The Treasury’s website reports the amount of interest paid on the national debt each year, going back 26 years. At the end of 2013, the total for the previous 26 years came to about $9 trillion on a federal debt of $17.25 trillion. If the government had been borrowing from its own central bank interest-free during that period, the debt would have been reduced by more than half. And that was just the interest for 26 years. The federal debt has been accumulating ever since 1835, when Andrew Jackson paid it off and vetoed the Second U.S. Bank’s renewal; and all that time it has been accruing interest. If the government had been borrowing from its central bank all along, it might have had no federal debt at all today.

In 1977, Congress gave the Fed a dual mandate, not only to maintain the stability of the currency but to promote full employment.  The Fed got the mandate but not the tools, as discussed in my earlier article here.

It may be time for a new populist movement, one that demands that the power to issue money be returned to the government and the people it represents; and that the Federal Reserve be made a public utility, owned by the people and serving them. The firehose of cheap credit lavished on Wall Street needs to be re-directed to Main Street.

Ellen Brown

Web of Debt

Published by the LA Progressive on December 22, 2013

12 Elements of Emotional Intelligence - By Marcia Sirota

Intellect and emotional intelligence are very different things. The former is the cognitive ability to synthesize and analyze data; to problem-solve and make associations based on available information. 

The latter is a set of innate and learned skills which facilitate relationships and enable a person to negotiate more easily through all areas of life.

Intellect can be measured by standardized IQ tests but there is no actual measure of the “EQ,” or Emotional Quotient. Even without a test, it’s obvious when someone has a high IQ and it’s just as obvious when someone has a high EQ. 

Rather than try to measure it, though, it’s more useful to look at the various elements that go into emotional intelligence.

While the IQ remains stable over a person’s lifetime, the EQ can be developed. Acquiring and practicing the following elements will enable you to boost your EQ.

The first element of emotional intelligence is empathy. The ability to understand what other people are feeling will make you more sensitive and aware and will result in more meaningful relationships. (this is true, but the real boon of empathy vs. sociopathy is reading minds)

The second element is the recognition that your actions have consequences. This understanding will enable you to make conscious choices in your life and to avoid unnecessary difficulties. (like giving you grandfather a heart-attack, so we are talking about the unforeseeable consequences of social relations, not simply physical consequences) 

Third on the list is good judgment. The gift of making well-thought-out decisions and seeing people for who they really are will maximize the possibilities of success in all areas of your life. (this is true, but what we're really talking about is 'good judgement' about other people, not good judgement about the weather, or how long it will take to learn to drive)

Number four is personal responsibility. When you hold yourself unaccountable and don’t blame anyone else for YOUR mistakes or misfortunes, you are empowered to change things for the better. Other people respect you, because you own up to your part in your relationships. (own your mistakes, not others, unless it helps with manipulating them)

The fifth element is insight. The ability to see yourself clearly and to understand your own motivations allows for the possibility of personal growth. Insight into others allows you to have a greater impact in your relationships. (manipulation)

Element number six is mental flexibility. Being able to change your mind or to see things from different points of view makes it possible for you to navigate all sorts of relationships and to succeed where other, more 'rigid thinkers' would fail. (cognitive dissonance gives one moral flexibility)

The seventh element is compassion. Being honest with yourself can be painful but with a kind and gentle attitude, it’s much easier. (I think she's speaking of forgiveness, not just understanding)

This type of compassion facilitates personal transformation (i.e. public humbleness), while compassion toward others supports deeper, more loving connections. (i.e. codependence and loyalty through extortion)

The eighth element is integrity. Following through on commitments and keeping your promises creates much good-will in personal and professional relationships and promotes success in both arenas. (this is true, live to your word or else)

Ninth on the list is impulse control. Thinking before speaking or acting gives you a chance to make deliberate, even sophisticated choices about how you present yourself to others. (seems to contradict honesty and integrity)  Not acting out of primitive impulses, urges or emotions avoids social embarrassment. (perhaps the problem is the society, no one should be  embarrassed) 

The tenth element is the ability to defer gratification (goes with nine). It’s one thing to want something but the ability to put off having it is empowering (the ability to endure frustration, and feign dispassion is a good tactical move) . Mastery of your needs allows you to prioritize around life goals.

Number eleven on the list is perseverance. Sticking with something, especially when it’s challenging, allows you to see it through to completion and demonstrates to others that you are dependable and potentially a high achiever. (dependable? high achiever?)

The twelfth and final element is courage. Emotional courage (as opposed to the physical variety) is the ability to do the right thing, see the truth, open your heart and trust yourself and others enough to be vulnerable, even if all this is frightening. This causes others hold you in high regard. (yea, that's what is important, what other's think about you)

All these elements combine within you to make up your emotional intelligence. With a high EQ, even a simple person is at an advantage in life. Without it, even someone with the most brilliant intellect is at a disadvantage.

© Marcia Sirota 2010 For More about Dr Sirota, 

http://www.ruthlesscompassioninstitute.com/

Having written extensively about healthy relationships, I believe seven simple steps will make it possible for you to have the best possible relationship. These are:

1. There’s no substitute for good communication. Expecting your partner to read your mind and know your needs and feelings without you having to tell them is a recipe for disaster. Assuming that you know what’s in your partner’s head without them telling you is equally problematic. Both people should be clear about what they want, how they feel, and what doesn’t work for them. This is the only way to know if you’re compatible.
2. You can’t change the other person. It’s hard to change, and people won’t do it unless they’re highly motivated. That being said, it takes a lot of time and effort to make significant changes. Assuming that you can get your partner to quickly and permanently alter some fundamental belief or ingrained behavior just because you want them to is setting yourself up for frustration and disappointment.
3. You won’t be happy if you’re not genuine. Trying to be a different person to please your partner will result in resentment toward your partner and dissatisfaction with the relationship. If you put on a false front, you’ll exhaust yourself. If your partner doesn’t know the real you, you’ll never feel truly loved.
4. Tolerating the unacceptable or settling for less doesn’t work. When you continually put up with behavior that upsets you or constantly settle for less than what you need, you’ll be miserable. You’ll never know if your partner is capable of giving you what you want unless you ask for it.
5. A relationship can’t thrive without mutual respect. You can’t take your problems out on each-other. Being together is not an excuse for dumping on one-another. Treating your partner with respect will deepen the trust and the love between you, whereas disrespect will undermine these bonds.
6. When you value yourself, you’re more likely to be valued. You can’t expect to be loved and respected if you don’t love and respect yourself. If you walk around with low self-esteem, you’re far more likely to attract losers who’ll want to exploit or mistreat you. When you’re confident and have good self-worth, you’ll attract happy, successful people who admire you and care about your well-being.
7. A relationship can’t fix your emotional wounds or compensate for childhood losses. Your partner can’t heal you or complete you. You need to deal with the baggage from your past, or forever be doomed to re-enact painful scenes from your childhood and adolescence in your present relationship. Dealing with your past hurts and putting them behind you will free you to have an adult, empowered relationship in which two intact people come together to share their full lives with each-other.

If you follow these seven simple steps, you’ll increase your chances of having the most fulfilling, successful relationship possible.

     

- See more at: http://marciasirotamd.com/about-dr-sirotas-5-areas-of-focus/relationships#sthash.0ujK70v1.dpuf

Defining the distinction between SCIENCE vs. Pseudoscience

Massimo Pigliucci interviewed by Richard Marshall.http://www.3ammagazine.com/3am/rationally-speaking/

Philosophy of science is a big interest for you. Science vs religion has been making headlines but you’ve recently written about the demarcation problem – the issue about how we make the distinction between science and pseudo-science, and this strikes me as being as equally problematic and important as the atheist vs believer dispute. This is something Karl Popper discussed and Larry Laudan more recently too. Before saying why aren’t they the last word for you can you briefly introduce us to how they tackled the issue?

Even if philosophy is making progress, what do you say to those who argue that philosophy is being left behind by the fast advance of science and it can’t do the work it ought to because it hasn’t enough resources? This is the gist of something Peter Ludlowhas argued – there just aren’t enough people being thrown at philosophical problems to keep up. And philosophers like Ludlow and Dave Chalmers warn of the singularity problem – that advances in technology will soon be so far in advance of human capabilities that human philosophy will become redundant.
RatinallySpeaking.org

3:AM: You participated in the Moving Naturalism Forward conference organized by Sean Carroll. You disagreed with mad dog naturalist Alex Rosenberg and defended a version of emergentism didn’t you? So why aren’t you with the mad dog view?
MP: Because it’s mad? Kidding aside, I don’t actually defend (strong) emergentism, as much as I am sympathetic to the idea and think the reasonable thing to do about it is to maintain agnosticism. Alex seems to think that modern physics has established the philosophical notion of strong reductionism, but this is highly debatable (and vigorously debated). Indeed, if one were to take a straightforward empiricist approach, one would have to lean toward emergentism, as there are plenty of higher-than-fundamental-physics level principles that scientists need in order to account for how the world works (i.e., quantum physics does no work at all – other than setting boundary conditions – in areas ranging from solid state physics to ecology, and from geology to the social sciences). And of course there is something inherently unsatisfactory, if not even downright self-contradictory, in people like Alex trying to convince others of the inevitable truth of nihilism. I mean, if he’s right, then everything we said at that workshop was already fated to happen since the moment of the Big Bang. So why argue about it? Except of course that according to his own doctrine he can’t avoid to argue about it, and I cannot but gently disagree, and so on…

3:AM: Are you agreeing with James Ladyman that there is no fundamental reality?

MP: That’s another area where I think engaged agnosticism is in order. I have read James’ and Don Ross’ Every Thing Must Go, and found it intellectually highly stimulating and thought provoking. Whether the notion that there are no “things” at the bottom of reality, or that – as they put it – ultimate reality is made of relations without relata, remains to be seen.
Science is clearly pertinent to answer certain questions about ethics. For instance: where does the strong feeling of right or wrong we all experience come from? Very likely from our evolution as highly intelligent social primates. Or, how does the brain handle ethical reasoning? That, obviously, is the province of neuroscience. But neither of these questions have much to do with the core of ethics, which deals with logic applied to resolving moral quandaries among actual human beings (or, as the virtue ethicists would have it, about answering what kind of life ought one to live). Anyone who has read Peter Singer or Michael Sandel will quickly recognize that the arguments put forth by Harris & co. are entirely irrelevant to the actual practice of ethics.

As Noam Chomsky once aptly put it, citizens of modern democracies need a course in intellectual self-defense to guard themselves against all the bullshit they will be bombarded with by corporate and governmental powers. I can’t think of anything better than studying history, reading Shakespeare and Joyce, learning how to admire a Picasso or Van Gogh, or understanding Aristotle and Marx as the foundations for that course.

3:AM: And finally, other than all your great books, are there five books you could recommend to readers here at 3:AM to take them further into your philosophical world?

MP: Just five? Ok, I’ll try, in no particular order:

- Bertrand Russell’s Autobiography, to learn about being a philosopher who is engaged in both rigorous intellectual work and important social causes.
- Michael Sandel’s Justice: What is the Right Thing to Do?, for a taste of what it is really like (pace Harris, Shermer et al.) to do ethics.
- John Searle’s Mind: A Brief Introduction, to appreciate how awesome philosophy of mind really is, and how much, ahem, debatable stuff has been written about it.
- David Hume’s An Enquiry Concerning Human Understanding, for a taste of first rate philosophy done by a first rate philosopher who writes both cogently and clearly.
- The Philosophy of the Hitchhiker’s Guide to the Galaxy, edited by Nicholas Joll, to appreciate how one can do philosophy about anything, and of course to be nudged toward (re-)reading Douglas Adams’ immortal masterpiece (which I guess was a sneaky way to get a sixth book on the list!)

Don't talk to me about "Chem-Trails" until you understand science.

http://contrailscience.com/

The Deep Web

TOR, Silkroad, Bitcoin, and Anonymous

http://hereandnow.wbur.org/2013/11/08/the-deep-web

On the origins of the deep web

“The real irony of this story, is this thing was built by the US government, in particular, the US Naval research laboratory. They worked out the theory in the 90′s and then launched it in 2003, and they had very good reasons for doing it. The deep web is a vital tool for intelligence agents, law enforcement, political dissidents in foreign countries with oppressive governments are trained in it by the state department.”

On the software needed to access the deep web

“Search engines like Google and Bing, you know, they use Spiders and other kinds of software to crawl the web, as it were. But you can only see web sites like the Silk Road if you’re working through Tor. Tor actually does two things: It keeps you anonymous, but it also allows you to see this whole range of web sites that would otherwise be invisible to you. Google doesn’t work with Tor; Bing doesn’t work with Tor. They only are interested in the conventional web. So this stuff just stays off the grid.”

On striking a balance between privacy and accountability

“If people know who you are online, then you’re responsible for what you do there, and whatever you do has consequences. That’s on the one hand. And we’re trying to balance that with the need for privacy, the need for people to keep their personal information off the net and out of the public eye, because there are things that people deserve to keep private, and technologies like Tor can do that. Unfortunately, technologies like Tor are also subject to abuse. And as it turns out, owing to various basic flaws in human nature, when people enter a situation where they can do things and not be held accountable for them, they tend to do some very bad things indeed.”

Amazing Animated Optical Illusions! #6

The Battle of Cannae 216 BC (+playlist)

Never leave your flanks exposed if you fight hand to hand like Romans, in huge deep blocks, where your soldiers can't be clever or move out of line. And never let their Calvary move to your rear (unless that's exactly where you want them). The leader by example.

EXCLUSIVE: Florida cop arrested for refusing to remove Guy Fawkes SPEAKS...