IS DAVID STOCKMAN RIGHT?

GET THE FACTS BEHIND THE NEWS!

David Stockman, Budget Director for Pres.Ronald Reagan.

American capitalism is so corrupted that change is impossible without a megameltdown, and collapse. Stockman knows well the political process is manipulated by a wealthy elite that cares nothing of the people, nothing of Main Street, nothing of the future of America. They care only for themselves.

Money has corrupted our political system. We’ve lost our moral compass. “The Triumph of Politics Over Economics” is a self-destructing ideology. Money has driven all politicians into a bizarre conspiracy that’s destroying America from within. And nothing but a thundering crisis will shock America awake.

Stockman has 10 reasons WHY A THE LARGEST BUST YET IS INEVIABLE unless America wakes up.
1. Politicians are addicts, can’t stop spending America’s future
Reagan’s big government policies “led to the utter failure of spending control.” Today America is “living way beyond our means,” and yet politicians are incapable of thinking past the next election. … money has become such a massive force in the electoral process” making politicians “slaves” to big money and special-interest lobbyists.
2. Cutting taxes: a cruel joke. “In pure philosophy, lower tax rates would be better.” You’re kidding yourself if you think cutting taxes today is really cutting taxes. We’re simply deferring massive tax increases into the future, unfairly and immorally putting huge debt burdens on future generations.” Tax-cutting is a “massive Christmas tree of special-interest tax benefits and loopholes … reducing the revenue”.

3. Social Security is a myth: Forget 2036, there’s no money today
“The combination of Medicare and Social Security” is “the heart of the budget, and the top one-third of that goes to retirees who have private assets, private pensions, other sources of income. They shouldn’t be dependent on the government … that money wasn’t saved,it was spent on cotton subsidies and bribes to warlords in Afghanistan. This is simply an intergenerational transfer program. … social insurance is a myth,” that bank is empty.
4. ReaganomicS(Republicans) loves war: Military spending is off the table“Reagan was utterly uninterested in any detail of the defense budget, of any of the claims for dollars made by the Pentagon,”. “He gave them a blank check, without question, and that … ballooned spending as we were massively reducing the revenue”.… Spending increases were so huge in defense that it became almost impossible to get anybody to … go after the food-stamp program or school lunches, when you’re just showering tens of billions of dollars on ammunition accounts and spare parts replacements and a massive expansion of the Navy.” Or wasting another “hundred billion dollars on wars of occupation in places that are the ends of the earth.”
5. Gross leadership failure: clueless ex-Goldman CEO at Treasury
“[Henry] Paulson frankly WAS the most incompetent, reckless secretary of the Treasury that we’ve had in modern history. He had no schooling in public policy, he had no schooling in the longer-term issues of fiscal management, or even what sound money is all about.” When “the crisis metastasized in” 2008 Paulson got “panicked calls from his buddies on Wall Street who were seeing their pyramids of debt coming crashing down.” And when Goldman Sachs’ stock cratered, Paulson panicked. “There was no philosophy behind it; there was never an analysis done.” Driven by a clear conflict of interest, he wanted to protect the $600 million fortune he built at Goldman, while saving his Wall Street buddies from bankruptcy. So Paulson failed the American people.
6. Bank bailouts: Bad economics now accelerating America’s decline
Paulson’s panicky failure in September 2008, … Even the House Republicans knew in their better judgment that it was a terrible idea, and they voted initially against it.” In fact, “the only panic that occurred was in” Paulson’s panicky mind. “Big pyramids of debt on Wall Street were coming crashing down. Had we allowed nature to take its course, maybe Goldman Sachs stock would have gone down to $10. But that’s their problem and that’s the problem of speculators who owned the stock, not a systemic problem for the economy.” Paulson’s panic made matters worse.
7. In a “free market,” Wall Street banks must be free to fail
“The fundamental principle of free-market capitalism is that you have to be free to fail as well as succeed,”. Socialize losses and privatize gains, you will destroy” our system of capitalism. Why? Because moral hazard encourages new “reckless risk taking, misallocation of capital.”
8. Today’s “crony capitalism” is destroying our faith in America
Wall Street is killing trust in the economy: “Once the broader public sees that the cronies of capitalism are bailed out by their friends in Washington or the Fed, why should they believe that the system we have is fair or is working in their interest?
9. Derivatives speculation: Wall Street gambles in shady casinos
Gold was “at the heart of it a fixed exchange rate system” before 1971 obligating “each country to settle its accounts at the end of every year … Chronic payments deficits and you were going to… lose your monetary reserves.” But when we “went to pure fiat money … financial volatility and instability” created a “massive speculative casino … Today probably 99% of currency futures are for speculation and 1% might be for legitimate trade hedging. That’s the problem we have in the whole financial system today.”
10. Too-greedy-to-fail banks are creating another bigger meltdown.
Before the crisis hit in 2007, “the top four banks in this country had $5 trillion of assets combined. After the whole crisis of too-big-to-fail and all of the bailouts, today the top four banks have $7 trillion of asset footings.” Simultaneously, fear has “been generated on Main Street, and the appropriate antipathy that’s developed towards the crony-capitalist policy of bailing out anybody that’s big and strong like GM and Goldman Sachs” has created a new “generation of workers that’s going to be turned into tax slaves … That will have to change … but it will only change when the crisis comes … .

Posted by diogenes at 12:45 PM 0 comments