Archive for March 8, 2009


The guys at Inhabit say they’re big fans of architect Adam Kalkin and it is easy to see why. This Kalkin piece called Bunny Lane is a house within a house in Kalkin’s home state of New Jersey. It’s not a new concept but aesthetically it seems well executed. The outer one building provides a shell, designed almost as a modern, industrial shed complete with unique features, custom roll-up doors and 3 stories of rooms at one end. The inner house is a traditional two-story New Jersey home, shining like a white-washed and pristine dolls house – and that for me is the only let-down of the whole aesthetic experience.

In terms of lifestyle, the design of the building seems to create a strong link between the main living area and the outside environment – sheltered but connected through large window walls when shut away from its external surroundings and open to wind and light with the doors rolled up. At the other end of the shed, the three stories of rooms with modern fixtures, metal staircases and lots of windows are well designed and could provide an exciting contrast to a tastefully designed inner house and the living area’s furniture. So, the idea is great.

Inhabitat mentioned that they “covered Kalkin’s other work before […], including his Quik House, made from recycled shipping containers. The shell of the Quik House can be erected in a day, and ready to occupy in 3 months. Kalkin is probably best known for his Push Button House, a single cargo container that unfolds, with the push of a button, into a plush little home”.


Inhabitat is a blog committed to innovation and highly aesthetic and user-focused design and technology that lead to a smarter, eco-friendly and sustainable way of living – all elements of “good design” which also includes “social context”. While “form and function” at Bunny Lane seem to be “intertwined” and even “social context” (for example middle class, aspirational maybe) could be assumed when judging the relationship between “style and substance”, I’m not so sure about the sustainability aspects. New Jersey for example is not exactly tropical, so it would have been good to share a few thoughts on how well the buildings (especially the outer one)  are insulated, especially when considering the large windows, metal cladding the large and expansive space provided by the outer shell. Energy related questions would also have to be asked in connection to the internal lighting of the buildings, which seems quite extensive. And what about the need for water recycling, water collection, the sustainability and ecology focused link between the building and its external environment? It’s a bit of a pity that the Inhabitat post spends much time considering the aesthetics but none on what seems to be the other core element of the blog’s mission.



For more info on Bunny Lane go to the Inhabitat site; see also the original link for the Inhabitat post on  Apartment Therapy .

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There are the serious times for reflecting on the vile systemic expressions of capitalism (like the actions of CEOs or politicians), and there are other times when you enjoy the quirky beauty of design, especially when it relates to objects made from recycled materials. This is an example from The Grateful Thread blog: clocks made from old warehouse stock vinyls. I think they look gorgeous: I love the whole idea, from choice of colours and labels to redefining the hand of a clock as the arm of a record player. Great way of transforming someone’s junk into someones else’s treasure. And it looks like you can even custom-order your own clocks!

The following article seems to provide a much more informed view than the hope and trust based “Outlaw the Shadow Banking System” post by Matthias Chang. I have never bought into the ‘Obama the new Messiah’ euphoria. Seeing him dealing with the so-called global financial crisis only strengthens my belief that despite all his rhetoric he is part of the political/corporate business establishment that will do anything to prevent profound changes to a sick system whose convulsions might see us slipping into a new great depression. But even if we ‘just’ remain in a prolongued severe recession, Obama’s vision and actions will most likely add material and emotional hardship for the majority of people while continuing to reward the elite that created their misery.

Systemic Failure: Capitalism “Lays An Egg”
By Stephen Lendman

After the 1929 October 24, 28 and 29 market crash, the weekly entertainment industry magazine Variety (on October 30) published its most famous ever headline: “Wall Street Lays an Egg.” In October 2008, history repeated, and since the October 2007 peak, equity prices plunged over 50% after the Dow and S & P (in February) posted their second worst ever monthly percentage declines – topped only in 1933 during the depths of the Great Depression. So far, the current market drop matches its 1929 – 1932 pace, and like then, shows no signs of abating.


With world economies collapsing, stocks are still overvalued by every metric – dividends, price to book, sales, free cash flow, or earnings based on GAAP (Generally Accepted Accounting Principals) or “reported” earnings, not “operating” ones, easily manipulated to exclude “write-offs.” By the mid-late 1990s, companies switched to the latter method to hide over-valuations. The practice still continues to let expensive stocks masquerade as cheap ones and make the market overall look attractive to the unwary.

After the 1929 crash, newspapers reflected the mood like the Chicago Tribune headlining: “Roaring Twenties grind to a halt and a new era of hard times begins.” Variety reported that “Broadway T(ook) the Slap” and New York “nite clubs, speaks & dives (echoed) market cataclysm.” Its Cairo correspondent cabled that a “cinema had finally been wired in Alexandria, Egypt, Cleopatra’s hometown,” so the paper quipped: “Only Sodom and Gomorrah remain(ed) to be heard from.”

The comment resonates today on a global scale when never have such best and brightest teams done so much for so few, so little for so many, and so greatly harmed world economies in the process – for eight years under George Bush, now continuing under Obama with no end to it in sight. The result – a likely Great Depression II that will match or surpass the worst of the first one. What Michel Chossudovsky calls “The Great Depression of the 21st Century: Collapse of the Real Economy (affecting) all sectors” globally because solutions are contributing to “further collapse,” too many “experts” remain in denial, and bad policies follow failed ones.

On February 28, Warren Buffett told shareholders that 2008 was Berkshire Hathaway‘s worst year, and he’s “certain that the economy will be in shambles throughout 2009 – and, for that matter, probably well beyond….” As for government responses so far, his comment reflected gloom: “Economic medicine previously meted out by the cupful has recently been dispensed by the barrel. These once-unthinkable dosages will almost certainly bring on unwelcome aftereffects.”

Perhaps this is what he has in mind: Given current conditions and the pace of continued decline, America and world economies face a possible synchronized global collapse, yet few come out publicly and say it.

Marx did in foreseeing much of what’s happening today:

  • the inevitable monopoly control of production, commerce, and finance;
  • a reserve army of exploited low-paid labor;
  • a class struggle between “haves” and “have-nots;”
  • capitalism’s internal contradictions: exploiting and alienating the many for the few;
  • its crisis-prone nature: unstable, “anarchic,” ungovernable, self-destructive with booms creating bubbles creating busts, then depressions; and ultimately
  • its inevitable decay and demise because a system so corrupted can’t endure; a socialist revolution (he believed) will replace it based on greater freedom, inclusion, and equality.

During the depths of the Great Depression, Franklin Roosevelt delivered his March 4, 1933 inaugural address and said what applies to today:

rosevelt“This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today….Values have shrunken to fantastic levels….our ability to pay has fallen; government of all kinds is faced by serious curtailment of income; the means of exchange are frozen in the currents of trade; the withered leaves of industrial enterprise lie on every side….the savings of many years of thousands of families are gone.”

“More important, a host of unemployed citizens face the grim problem of existence, and an equally great number toil with little return. Only a foolish optimist can deny the dark realities of the moment.”

“Primarily this is because the rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence, have admitted their failure, and abdicated. Practices of the unscrupulous money changers indicted in the court of public opinion, rejected by the hearts and minds of men….Faced by failure of credit they have proposed only the lending of more money (and exhortations) to follow their false leadership. They have no vision, and when there is (none) the people perish.”

“The money changers have fled from their high seats in the temple of our civilization. We may now restore (it. Doing it will involve) the extent to which we apply social values more noble than mere monetary profit….there must be an end to a conduct in banking and in business which too often (results in) callous and selfish wrongdoing. (We need) action and now….to put people to work….(by redistributing land to those) best fitted (to use it (and) by preventing the tragedy of….foreclosure of our small homes and our farms.”

We need in place “safeguards against a return of the evils of the old order; there must be strict supervision of all banking and credits and investments; there must be an end to speculation with other people’s money, and there must be provision for an adequate but sound currency….For the trust reposed in me, I will return the courage and the devotion that befit the time. I can do no less.”

Roosevelt later saw poverty’s spreading scourge, “millions of families trying to live on incomes so meager that the pall of family disaster (hung) over them day by day….one-third of the nation ill-housed, ill-clad, and ill-nourished.” The same specter haunts millions today, but there’s no Rooseveltian leadership to address it.

On February 21, Reuters reported that George Soros said the world financial system has effectively disintegrated, and there’s no prospect of near-term crisis resolution. He called the turbulence worse than in the Great Depression and said Lehman Brothers bankruptcy was a turning point in “the collapse of the financial system. It was placed on life support, and it’s still (there).”

On the same day at a Columbia University conference, Paul Volker couldn’t “remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world.” He cited industrial production falling faster globally than in America because of the fallout from unbridled financial markets. “It’s broken down in the face of almost all expectation and prediction,” and greater regulation is coming as a result.

“In the future, we are going to need a financial system which is not going to be so prone to crisis and certainly not prone to the severity of a crisis of this sort. (It will) be different from the (one) that has developed in the last 20 years.” Its “primary characteristic (should be) a strong, traditional, commercial banking-type system….to service customers, individuals, businesses and governments by providing outlets for their money and by providing credit.”

This should be their core business, the same as in America 30 years ago and under closer regulation. Risky “entrepreneurial activity” should be out. Big and small commercial banks must stick to their knitting and not operate like hedge funds or casinos. Mostly what’s needed is stability in place of recklessly pursuing profits at the risk of a global economic collapse.

Obama Responds

Since taking office on January 20, Obama has been a caricature of a leader, a Manchurian candidate president, a front man for a criminal Wall Street – government partnership. The latest Zogby poll showed only 27% believe his stimulus will help them, and just 23% have confidence in either party.

obamatopiaIn Obama’s nationally televised February 24 address to a joint session of Congress, contrast his comments to FDR’s, He:

  • downplayed the crisis;
  • vowed “We will rebuild, we will recover, we will emerge stronger than before;”
  • cited our unique greatness – “the greatest force of progress and prosperity in human history;”
  • defended trillions for bankers with “more (coming) than we’ve already set aside:” from a TARP II providing “commitments exceeding $2 trillion” plus another trillion or more from a so-called Public-Private Investment Fund (PPIF) offering sweetheart deal guarantees and financing to investors to buy toxic bank assets at bargain basement prices;
  • ignored the most serious unaddressed problems: decades of accumulated debt and the bad asset overhang in the hundreds of trillions that all proposed plans barely dent;
  • blamed “people” for “spend(ing) more money and pil(ing) up more debt….than ever before;”
  • ignored Wall Street’s criminal excess and fraud, and
    the looting of the Treasury to reward them; said nothing about a corrupted system that should be scrapped for a fair one;
  • offered nothing in the way of a New Deal approach; instead offered an anti-New Deal by promising to shrink the deficit to $533 billion, or 3% of GDP, by 2013; doing it means cutting social programs like Social Security, Medicare, and Medicaid; what FDR provided, Obama may take away;
  • defended his counterproductive policies with new ones piling more abuses on the others and increasing the debt burden instead of reducing it;
  • lied that they’re “not about helping banks – (they’re) about helping people;” and
  • was silent on his hidden agenda for business at the expense of working Americans and the millions criminally defrauded out of jobs, savings, homes, pensions, and futures.

In today’s popular jargon, America failed its “stress test.”

Yet, Obama audaciously ended by saying:

“….some day, years from now, our children can tell their children that this was the time when we performed, in the words that are carved into this very chamber, “something worthy to be remembered.”

His comments followed Fed chairman Bernanke’s earlier in the day’s prepared semi-annual monetary policy report to Congress saying:

“If actions taken by the Administration, the Congress, and the Federal Reserve are successful in restoring some measure of financial stability….there is a reasonable prospect that the current ‘recession’ will end in 2009 and that 2010 will be a year of recovery.”

He also said the nation’s largest banks aren’t “zombies” when, in fact, at least the top 20 are insolvent and need bailout help to keep operating. Earlier, he saw no market bubbles and said high home prices reflected a strong economy.

A Planned Public Response

On April 3 and 4, the Bail Out the People Movement” plans a national march on Wall Street on the anniversary of Martin Luther King’s assassination. His message was:

“Rise up against wars of colonial conquest.

Fight for the right of all to a job or an income.”

Nationally, more than 50 organizing centers are involved in response to the growing crisis; an absence of leadership in Washington; and an agenda of foreign wars, occupation, and rewarding criminal bankers and the rich at the expense of millions of distressed households.

“Working people must organize independently to Bail Out People, Not Banks. It’s time to march on Wall Street,” to denounce this injustice and act.

Visit for full information on getting involved, a list of endorsing organizations, and information on organizing centers in a growing number of states, including New York, California, Illinois, Michigan, Pennsylvania, Texas, Florida, and Ohio.

In Denial Over the “D” Word

In the dominant media, inconvenient truths are suppressed, denied or delayed until they’re too explosive to ignore. Even then, coverage is way short of explaining that we’re in the early stages of the greatest ever economic decline. Policy makers are flying blind to contain it. They can’t grasp its gravity. All measures tried have failed, and capitalism’s ideological roots are at stake. For economist Richard Wolff – “Capitalism Hit the Fan,” unworkable, unjust, and spreading global chaos everywhere with frightening speed.

great-depressionWhat began as a financial crisis has now exploded with even some mainstream economists predicting a global “depression,” and IMF chief Dominique Strauss-Kahn saying advanced economies are already in one.

Perhaps others will admit it after the UK Telegraph’s February 26 headline: “Moody’s predicts default rate will exceed peaks hit in Great Depression” when it reached 15.4%. The risks are enormous because “we are in unchartered territory….If the economy deteriorates more than expected,” the rate could top 20% and be even higher in Europe – for all “non-investment grade issuers.”

Merrill Lynch’s David Rosenberg used the “D” word earlier in his end of January commentary titled: “Some inconvenient truths.”

Not your father’s recession he said, but “maybe your grandfather’s….We are likely enduring a depression today,” and while there are no official definitions, we’ve had them before – four in the 19th century and a great one in the 20th.

Recessions are generally defined as two or more consecutive GDP contracting quarters although some economists prefer measures of the relative strength or weakness of production, employment, retail sales, and so forth.

For economist John Williams, a depression is a period where inflation-adjusted peak-to-trough contraction exceeds 10%, and in a great one it’s 25%.

Duration is also important. On average, recessions last about 18 months. For Rosenberg, depressions last “anywhere from three to seven years” or longer “and tend to follow years of leveraged prosperity proportions” like the period between 2002 – 2007.

Recessions are typically “inventory cycles,” while depressions feature “balance sheet compression and deleveraging: debt elimination, asset liquidation, and rising savings rates.” When credit expansion becomes a bubble, “the distance to the mean is longer and deeper” with upside excesses producing comparable or greater ones on the downside.

Clearly, we’re way beyond a classic recession after a year and a half of massive stimulus, capital injections, “unprecedented interest rate relief,” and various other measures producing no end in sight “or any signs of normalcy returning to credit.”

Based on reverse-engineering the data, Williams guages unemployment at 18% when discouraged and part-time workers are included. Rosenberg says 13.5%, but either figure far exceeds the official fictitious 7.6%. Rosenberg also places idle manufacturing capacity at 30%, a level reached only once previously in the past five decades.

As for stimulus, Rosenberg sees little impact either from tax cuts or infrastructure spending. The latter “comes with a long gestation period” unlikely to be felt until “well into 2010.” It also falls short of boosting long-term growth. With all proposed monetary and fiscal stimulus, the economy will still “be saddled with roughly $1 trillion of excess capacity” by year end.

So far, around $1 trillion in debt has been written off. It’s not enough. We’re “still in the early stages of credit contraction (and) have no idea when the credit cycle will hit bottom.” Before it does, “more than $6 trillion in private sector debt must be eliminated.” Time, likely years, are needed for resolution, but the Obama administration plans don’t address it.

Going forward, households, especially “boomers,” will stress “frugality,” not “frivolity.” Apres le deluge, saving for retirement is crucial as deflated assets and lost pensions won’t provide it.

Here’s more:

  • Federal Reserve surveys show household credit demand declining to the lowest level on record while debt is at “near-record levels relative to after-tax incomes” and so is the debt-servicing burden;
  • 10% of borrowers are in arrears or foreclosure;
  • bank delinquency rates are the highest in 15 years and rising; the earlier S & L crisis was pocket change compared to now;
  • credit card delinquencies are at an all-time high at a time the overall credit quality index “collapsed to an all-time low;”
  • this begs the question: how can banks lend when households can’t and won’t borrow; “bringing households to the well doesn’t mean they will drink;”
  • despite much lower home prices, affordability ratios the best in over 35 years, and attractive mortgage rates, the record low National Association of Home Builders (NAHB) homebuilding index showed “residential real estate (perceptions) have changed;”
  • on February 24, the latest Conference Board consumer confidence index explained why; it plunged from 37 in January to 25 in February, its worst reading ever, and one year ago it was 76; the Economic Outlook Group’s Bernard Baumohl called it a “catastrophic collapse of confidence in the economy” even after all measures the Obama administration announced;
  • it also explains “a secular (attitude) change toward consumption;” after peaking last summer, it declined at a 15% annual rate; even food is affected with consumers choosing tuna over trout and spaghetti or Spam over steak or shrimp;
  • households have been devastated by a 20% hole in their balance sheets, or a cumulative $13 trillion net worth loss as of January 1; it’s the first time this happened since the 1930s; Rosenberg sees it hitting $20 trillion by year-end 2009, a level on a par with the Great Depression with no end of this in sight; this “permanent shock” is a harbinger of “sustained consumer contraction in coming years;”
  • household savings are rising but still unsustainably low (at under 3%) and will likely head toward earlier 10 – 12% levels; “there are no more rabbits to be pulled out of the hat” to encourage spending; the effect will be powerfully deflationary “for some time.”

Paulson and Geithner’s Violation of US Law

Specifically – Title 12, Chapter 16, Sec. 1831o of the US Code collection that Economics Professor and former Senior government regulator during the earlier troubled S & L period William K. Black discussed in his February 23 Huffington Post article titled: “Why Is Geithner Continuing Paulson’s Policy of Violating the Law?”

geithnerWell before they’re insolvent or when serious problems are suspected, US law “mandat(es) that the administration place troubled banks….in receivership, appoint competent managers, and restrain senior executive compensation” to prevent bonuses, huge salaries, raises, and undeserved benefits from being paid.

No provision says taxpayers should bail out bankers. Yet Paulson and now Geithner keep doing it, using vast sums kept secret – both in amounts and to whom beyond the handful of big names made public.

Geithner was at it under Bush. As New York Fed president, his responsibility was “to regulate many of the largest bank holding companies in the United States. Far too many of (them) are deeply insolvent because” they own insolvent banks. “The law mandates that” they be placed in receivership, yet as Treasury Secretary Geithner continues to violate it.

Under George Bush, congressional oversight largely stopped at the cost of today’s crisis. According to some, the worst is yet to come because of criminal negligence and complicity at the highest levels of government.

“Secretaries Paulson and Geithner subverted the law by allowing failed banks to engage in massive accounting fraud (including securities fraud).”

In a follow-up February 25 article, Black explained that the FBI warned of a mortgage fraud “epidemic” in September 2004 and reported that “lenders initiated 80% of these frauds….Financial control frauds’ ‘weapon of choice’ is accounting.” It flourishes in a deregulatory climate when (as the title of Wheeler and Rothman’s 1982 book suggests): “The Best Way to Rob a Bank is to Own One.”

The FBI spotted it in time to stop it. Nonprime lenders were the main culprit with Wall Street deeply involved. The fraud was so extensive, it was easy to spot. Instead, banks, rating agencies, and buyers “operated on a ‘don’t ask; don’t tell’ policy.” While it lasted, profits were huge, and few were the wiser. Today, “many (likely all) the big banks are deeply insolvent due to severe credit losses.” They and the Treasury aren’t even sure to what degree, but the amounts are staggering in size. “A ‘stress test’ can’t remedy the banks’ problem – they don’t have the loan files” for documentation.

Under Bush and Obama, banks are licensed to steal. The (“quantitative”) looting of the Treasury continues, and global economies sink deeper into a black hole of depression with the public as always the big loser.

The End Game to Economic Ruin?

Who can know, but look what casino capitalism brought us. In December 2006, John Bellamy Foster discussed “monopoly capital’s” evolution in commemorating the 40th anniversary of Paul Baran and Paul Sweezy’s classic work: “Monopoly Capital – An Essay on the American Economic and Social Order.” In his new book, The Great Financial Crisis: Causes and Consequences, he discusses the legacy it left us.

Giant corporations arose early in the last century followed by wars, depression, and more wars. Post-WW II, “capitalism was fully consolidated, particularly within the United States, the most advanced capitalist economy,” and for some years thereafter the only healthy major one unravaged by the war.

As a result, corporate America flourished, grew larger and more dominant. Profit-making oligopolies and monopolies resulted “competing not on price but mainly in the areas of cost-cutting and the sales effort.” Out of this grew “surpluses, and the economy’s problem was to absorb it to avoid stagnation.”

disadvantagedIt led to overcapacity, so key was “to find additional outlets….beyond capitalist consumption and investment” or face “economic malaise.” Beginning in the late 1960s and 1970s, financialization came to the rescue, and “to some extent (shifted) control over the economy from corporate boardrooms to the financial markets. Corporations were increasingly seen as bundles of assets, the more liquid the better.” A new “monopoly finance” capitalism was advanced to exploit it.

It produced new outlets for surplus in the FIRE sector (finance, insurance, and real estate), mostly for speculation, not capital goods investments in plant and equipment, transportation, and public utilities that earlier fueled business cycle expansions. It kicked off a “whole new historical period” that wasn’t apparent before the late 1960s. But the implications were huge and today have backfired.

The 1980s saw “an unprecedented upsurge of debt in the economy.” In the 1970s, it was about one-and-a-half times GDP. By 1985, it was double, and by 2005 it was three-and-a-times GDP, rising, and approaching “the $44 trillion (level) for the entire world.” Ever since, “the way was open for a proliferation of financial instruments and markets, which (until the present) proved to be literally unlimited.”

Much earlier, Keynes warned about “enterprise becom(ing) the bubble on a whirlpool of speculation” like in the 1920s, the price being the Great Depression.

Beginning in the late 1960s and 1970s, the process began repeating as “economic malaise” needed new stimulus. “Unable to find profitable outlets….within the productive economy, corporations/capitalists sought” opportunities through financialization, speculation, casino capitalism, “while the financial system responded with a bewildering array of new financial instruments – including stock futures, options, derivatives, hedge funds, etc.” As a result, a “financial superstructure…took on a life of its own” that today is consuming world economies.

Back then was different. “New Economy” notions took hold. The sky was the limit, but bubbles eventually grow and always burst. Minor by comparison, the 1997-98 Asian crisis showed how fast contagion can spread. Today it’s global and out-of-control. No one’s sure how to contain it, so bankers are getting trillions in a desperate attempt to socializing losses, privatize profits, and pump life back into a corpse through a sort of shell game or grandest of grand theft process of sucking wealth from the public to the top in hopes enough of it will work.

Speculation and debt need more of it to prosper, but in the end it’s a losing game. The greater the expansion, the harder it falls – especially when not making things and working Americans are exploited. Since the 1970s, wages stagnated and lost purchasing power as inflation rose. So did benefits like health care and pensions. Household debt rose to compensate. Two wage-earner households as well. It let “monopoly-finance capital (produce) an accumulation of misery” now exploding since 2008’s global collapse, exposing capitalism’s dark side and destructive contradictions, particularly its financialization form.

Foster quoted Baran and Sweezy’s response to an “irrational system.” What’s needed is “our moral obligation to (fight) against an evil and destructive system which maims, oppresses, and dishonors those who live under it, and which threatens devastation and death to millions….around the globe.” Today, the threat is real, growing, and becoming greater than most anyone imagined, remembers, or has any sure way to contain.

Stephen Lendman is a Research Associate of the Centre for Research on Globalization. He lives in Chicago and can be reached at

Also visit his blog site at and listen to The Global Research News Hour on Republic Monday through Friday at 10AM US Central time for cutting-edge discussions with distinguished guests on world and national issues. All programs are archived for easy listening.

Stephen Lendman is a frequent contributor to Global Research. Global Research Articles by Stephen Lendman

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By Engler, Yves
Yves Engler’s ZSpace Page
Join ZSpace Haiti can teach you a lot about the harsh reality of social affairs.

From the grips of the most barbaric form of plantation economy sprung probably the greatest example of liberation in the history of humanity. The 1791-1804 Haitian Revolution was simultaneously a struggle against slavery, colonialism and white supremacy. Defeating the French, British and Spanish empires, it led to freedom for all people regardless of color, decades before this idea found traction in Europe or North America.

un-haitiUnfortunately, Haiti’s history also demonstrates how fluidly Europe (and North America) moved from formal colonialism to neo-imperialism. Technically “independent” for more than two centuries, outsiders have long shaped the country’s affairs. Through isolation, economic asphyxiation, debt dependence, gunboat diplomacy, occupation, foreign supported dictatorships, structural adjustment programs and “democracy promotion” Haiti is no stranger to the various forms of foreign political manipulation. Most recently, the elected government of Jean-Bertrand Aristide was destabilized and then overthrown on February 29 2004 by the US, France and Canada, which ushered in a terrible wave of political repression and an ongoing UN occupation.

As we approach the five-year anniversary of the coup, there are three important lessons to be learned from this intervention. First of all, the Canadian sponsored responsibility to protect” doctrine, which many want to encode in international law, is little more than a cover for imperialism. Liberal Party officials justified cutting off aid and invading Haiti by citing a “responsibility to protect” the country, yet the intervention further devastated an already impoverished population.

The second lesson is that “peacekeepers” can be used to wage a brutal class war. In the two years after the coup, UN troops regularly provided vital support for the Haitian police’s violent assaults on poor communities and peaceful demonstrations demanding the return of the elected government. UN forces also participated directly in this violent political pacification campaign, launching repeated anti-“gang” assaults on poor neighborhoods in Port-au-Prince. The two most horrific raids took place on January 6, 2005 and December 22, 2006, which together left some 35 innocent civilians dead and dozens wounded in the densely populated slum of Cité Soleil (a bastion of support for Aristide). In April 2008 UN troops once again demonstrated that their primary purpose in the country was to defend the status quo. During riots over the rising cost of food they put down protests by killing a handful of demonstrators. (Kevin Pina’s film Haiti: The UNtold Story, which will be shown across the country in the coming weeks, documents the chilling brutality of UN forces.)

Finally, Haiti provides an example of how self-described “progressive” Western government-funded NGOs function as an arm of imperialism. A sort of NGO laboratory, Haiti is a highly vulnerable society where NGOs have a great deal of influence. By one estimate, Haiti has the most development NGOs of any country per capita and the vast majority of the country’s social services are run by domestic or foreign NGOs. Their influential position in Haiti provides a clear window into Western government-funded NGOs worst tendencies.

cite-soleilMany NGOs joined the Bush administration, Ottawa and a handful of armed thugs in calling for the removal of Haiti’s democratically elected president in 2004. After repeatedly complaining about human rights violations under the elected government, these groups (Development and Peace, Rights and Democracy, Oxfam Québec, Alternatives etc.) ignored or denied the massive increase in human rights violations that took place in the aftermath of the coup. A January 2008 federal government-funded report published by Alternatives (Québec’s biggest proponent of the World Social Forum) provides an eye into NGOs colonial attitude vis-a-vis Haiti: “In a country like Haiti, in which democratic culture has never taken hold, the concept of the common good and the meaning of elections and representation are limited to the educated elites, and in particular to those who have received citizen education within the social movements.” According to Alternatives, Haitians are too stupid to know what’s good for them, unless, that is, they’ve been educated by a foreign NGO. (For a detailed account of government-funded NGOs role in Haiti see Press for Conversion’s three recent reports or Damning the Flood by Peter Hallward.)

In trying to reason with these groups, one discovers that information or rational argument does little to sway groups receiving millions of dollars from the Canadian government for work in Haiti. Maintaining a progressive agenda in a country considered “high priority” by the power brokers in Ottawa is extremely difficult. And with the intervention into Haiti – unlike say the invasion of Iraq -on few people’s political radar, these NGOs felt limited grass-roots pressure to abandon their government benefactors.

Unlike in Canada Western government-funded NGOs are widely criticized in Haiti. Most progressive minded Canadians see NGOs as part of the solution to global poverty yet where these groups are “helping” out the situation is quite different. Across the country’s political spectrum, Haitians have been highly critical of development NGOs role in undermining the country’s government. A couple months ago the left-wing newspaper Haiti Progrès called NGOs in the country a “mafia” and on February 5 the country’s president, René Préval, called on Washington to stop channeling its assistance through NGOs.

Yves Engler is the author of the forthcoming The Black Book of Canadian Foreign Policy and other books. If you would like to help organize a talk as part of a book tour in May/June Please e-mail:

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“The Last Picture Show”: Obama’s Fiscal Year 2010 Budget

By Richard C. Cook

anarene-texas[“The Last Picture Show” was a 1971 film depicting the decay of small town America . It took place in the fictitious town of Anarene , Texas .]

We hear a distant tune reminiscent of America ‘s high and lonely places and the sound of a dry wind blowing. It’s March 2010 in the tiny West Texas town of Anarene . Nothing much happens here any more. The last business shut down a couple of years ago. It was a cement plant that went broke after the housing bubble burst and the banks stopped lending. The kids out of high school drive their jalopies from one end of Main Street to the other past boarded-up storefronts.

Some of the grown-ups carpool to low-wage jobs in a city 50 miles down the road. The elderly have had their Social Security eaten up by the high price of food but still get by on Spam and Kool-Aid. There used to be a movie theater, but it too closed a few months ago. Not a single person went to the “Last Picture Show.”

But there is change in the air! President Barack Obama, who was elected president a couple of years ago, is in the middle of his fiscal year 2010 budget. The 2009 budget had a deficit of $1.75 trillion, a number no fool could even have imagined before the crash of 2008. The projection for 2010 is $1.17 trillion, due to the government’s hopes for an economic recovery. But the jury is out on whether a recovery will ever happen.

Some say the banks are starting to lend again, though no one at the Anarene State Bank knows anything about it. Some say the city down the road is getting a plant to make blades for those new wind turbines. The Anarene high school got funding for an adult training course on writing resumes. The Nightly News says, “ America is coming back.”

I wish!

So what is really going on here?

Well, President Obama’s 2010 budget has attracted a lot of attention. $1.75 trillion? That’s not federal spending. That’s new federal debt!

A good measure of fiscal policy is federal government tax revenues. Revenues for 2010 are projected at $2.19 trillion, off 13 percent from a year ago, due to the recession. With the huge bank bailouts and Obama’s $787 billion economic recovery program, 2010 expenditures are estimated at $3.94 trillion, an increase of 33 percent over 2008.

Then there’s the interest taxpayers must pay on the national debt, which will likely reach $600 billion in 2010. Of course almost 100 percent of all new federal debt is financed by foreigners, mainly China .

But don’t worry, the recovery program will succeed, and the economy will start growing again. THE GOVERNMENT PROMISES! Obama’s budget forecasts such a strong upsurge in economic activity by the end of 2009 that the net for the year will be GDP growth of 1 percent. (Yes, that’s what it says.)

Is it a contradiction that the government is conducting “stress tests” on the nation’s banks in which it is predicting that the recession will last at least until 2011 to see if those banks are strong enough to weather the storm? Yes, it is a contradiction. Even the Federal Reserve does not see recovery coming as quickly as Obama’s budget. Neither do any economists. The budget is not an honest document.

It gets worse. The budget says growth will then continue as far as the eye can see—the projections go out to 2019, when we’ll have a GDP of $22.86 trillion, 61 percent higher than 2008. Happy days will be here again!

So go back to sleep, America . It’s official. The recession we are in right now will end soon and is the last one ever.

This means that the financial industry will soon be fixed, plenty of good jobs will be available, climate change and drought will be overcome, the government budget will be right-sized, and America and the world will be content and at peace. All because of the decisions being made by the Obama administration and approved by Congress during these few critical weeks we’re in the middle of right now.

But there are a whole swarm of flies in the ointment. I’ll mention just two.

debtOne is that according to University of Massachusetts economist Thomas Ferguson, who spoke at last weekend’s Eastern Economic Conference national conference in New York , the Bush/Obama bank bailouts alone will cause a permanent addition of interest payments on the national debt of $100 billion a year forever. That means every American will pay, during the course of his or her lifetime, over $20,000 to rescue the banks from their bad loans. To put that number in perspective, it equates to 2-1/2 years of tuition at a state university that instead will be paid to the government of China or a similar foreign investor.

Yes, America , that is what your elected government just decided you will do.

Another is that the U.S. has had virtually no real economic growth since the early 1970s, because since then we’ve lived in a bubble economy. Look it up. Most of our industrial output has been flat or has declined. Whole industries, such as steel, are shadows of their former greatness. The automobile industry is on life support. We’ve imported huge amounts of foreign capital by selling them our real estate and businesses. As stated on the Economy in Crisis website:

“The United States now no longer controls many of its domestic industries. Over the last 10 years alone foreigners have spent $1.2 trillion to acquire more than 8,000 key US companies. Already as of 2002, foreigners owned fully 20 percent of American manufacturing. In many high-tech and defense-related industries, the proportion is far higher. Such US industries as mining, cement, publishing, engine and power transmission equipment, rubber and plastics, and sound recording and motion pictures are now largely foreign owned. Even in industries like pharmaceuticals, chemicals, industrial machinery, transportation equipment, electronics, metal industries, and coal and petroleum industries, foreign ownership has recently become very high.”

Until the last year, the biggest growth industry within the U.S. had been the financial sector, producing profits of over $500 billion as late as 2006. In other words, the U.S. has replaced working for a living with the manipulation of money and the extraction of interest, either by lending it or by brokering the lending and investment by foreigners. In order to enrich themselves, the financiers, with a lot of help from the government, created the merger/buyout bubble of the 1980s, the

bubble of the 1990s, and the housing/equity/hedge fund/derivative bubble of the 2000s.

All this time, the federal, state, and local governments have tried to keep up by taxing every financial transaction they can get their hands on, including by raising property taxes on the inflated value of family homes. But now, with the last of the bubbles deflating, the tax base is vanishing. So governments, along with the private sector economy, which has been living on capital gains in the absence of job income for all but the very rich, have gone into the tank as well.

President Barack Obama’s economic recovery program, along with the budget just released, is an attempt to substitute a federal government bubble for the failed private sector ones. Like the private sector bubbles, this one is also based on debt. This is because debt is the only way anyone in the U.S. can any longer think of when it comes to creating a national money supply. It includes the president’s proposed $5 billion federal infrastructure bank for lending to state and local governments. This bank will probably offer better interest rates than the bond markets, but it’s still debt.

There was a time in U.S. history when other ways were known to create money; for instance, during the Civil War, when Congress authorized the Lincoln administration to spend Greenbacks directly into existence. The banks hated the Greenbacks, of course, so they got Congress to pass the National Banking Acts of 1863-64, which were the prelude to the Federal Reserve Act of 1913. Today, Greenback-type funding for the federal government is one of the chief provisions of the American Monetary Act drafted by the American Monetary Institute (

Another way to introduce debt-free money into the economy is through a dividend, such as the Alaska Permanent Fund, which in 2008 paid every resident $3,269 tax-free out of the state’s resource revenues. There is no good reason why such a dividend could not be paid by every state or by the federal government.


Greenbacks and programs like the Alaska Permanent Fund are part of what I call Dividend Economics. It’s why I’ve proposed the “Cook Plan,” which would be a system of vouchers for the necessities of life in the amount of $1,000 a month for any adult citizen who applied. A smaller amount would be provided as an allowance for children.

The vouchers would be taxed like any other income and would supplement other entitlements such as unemployment compensation, Social Security, etc. But taxes would be low for those who would use the vouchers as a main source of income. Under the plan, the vouchers would then be accepted as deposits at a new network of community savings banks that would lend at one percent interest to consumers, students, small businesses, local manufacturing establishments, and family farms.

This would introduce over $2.5 trillion of debt-free money into the economy over the next year, because under the “Cook Plan,” the dividend would be paid directly by the U.S. Treasury without borrowing or taxation. It would not be inflationary, because it would replace money from public bank lending and would result in new goods and services being created within the U.S. producing economy. In fact, we would see a renaissance of local and regional economic activity that would eventually transform the national economy as well.

You may ask, should we just be “giving away money?” My answer is that if the banks can create trillions of dollars in credit out of thin air for lending, why can’t the government create it for the people? The same goes with the trillions the government is borrowing to pay to the banks to reinflate the bubble economy. Give it to the people instead. Look at Obama’s economic recovery program that equates to $225,000 for each new job it hopes to create and probably won’t. Give that to the people too. Let them use the money as a dividend to live on during this emergency and create new jobs as well.

Right now there is nothing further from the minds of President Obama and his advisers than such ideas. That’s why his new bubble budget is America ‘s “Last Picture Show.”

Richard C. Cook is a former U.S. federal government analyst. His book on monetary reform, We Hold These Truths: The Hope of Monetary Reform, is now available at He is also the author of Challenger Revealed: An Insider’s Account of How the Reagan Administration Caused the Greatest Tragedy of the Space Age. He can be contacted through his website at

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I personally think that Matthias Chang is much to optimistic in his article, but I’d like to give him the benefit of doubt despite seeing many indications that so-called world leaders do not want to make major changes to the financial system which, after all, they fervently supported for many years. But anyway, maybe I am just too cynical … ;).

“Outlaw the Shadow Banking System!”
Guess Who Said It?

By Matthias Chang
URL of this article:
Global Research

bear-stearnsWhen I read the remarks of President Obama and Prime Minister Gordon Brown after their meeting at the Oval Office on March 3, 2009 and the speech of the latter to the Joint Session of Congress on March 4, 2009, I realized that a growing antagonism has emerged between certain factions of the ruling elites in the City of London and in Washington DC.

The first warning of the acute differences was sounded by President Obama himself and it was most surprising that the mass media paid hardly attention to it. In his weekly address on February 28, 2009, President Obama said:

“I realize that passing this budget won’t be easy. Because it represents real and dramatic change, it also represents a threat to the status quo in Washington. I know that the insurance industry won’t like the idea that they’ll have to bid competitively to continue offering Medicare coverage, but that’s how we’ll help preserve and protect Medicare and lower health care costs for American families. I know that banks and big student lenders won’t like the idea that we’re ending their huge taxpayer subsidies, but that’s how we’ll save taxpayers nearly $50 billion and make college more affordable. I know that oil and gas companies won’t like us ending nearly $30 billion in tax breaks, but that’s how we’ll help fund a renewable energy economy that will create new jobs and new industries. In other words, I know these steps won’t sit well with the special interests and lobbyists who are invested in the old way of doing business, and I know they’re gearing up for a fight as we speak. My message to them is this:

“So am I.”

Read the underlined words again.

It is clear something is definitely amiss within the ruling elites and President Obama has thrown the gauntlet to his adversaries. The skeptics may say that we should not read too much into this above quoted paragraph, as it could be mere spin to rally the troops in times of crisis. Time will tell.

I take the view that it is inevitable that the members of the ruling elites would go for each other’s throats because those who were given the charge to ensure that the money-machine keeps running have screwed up big time. Someone must answer for the fiasco.

The Blame Game

It would be naïve to assume that the status quo would remain, when the Global Trillion Dollar Casino is for all intents and purposes broken down beyond repair.

Confirmation that the blame game has started in earnest can be found in the aforesaid remarks of President Obama and Prime Minister Gordon Brown on March 3, 2009 given after their meeting at the Oval Office and Brown’s speech to Congress on March 4, 2009.

Let us come back to the issue of the money-lenders. For some strange reason, many people are put off by the term “money-lenders” but are ever so comfortable with bankers.

jp-morganBut are not bankers, money-lenders?

In fact I would say that money-lenders are more honourable than your high street bankers, as they can only rob you in the millions. The global bankers, they rape and plunder in the trillions!

Is it any wonder that Gordon Brown and President Obama, the political representatives of the Power Elites have decided that it is about time that these financial harlots are to be brought under control before they wreck the entire global power structure?

Let us have no illusions about Obama and Gordon Brown. They are going after these financial harlots not because they want to protect us from these criminals, but because for too long the political faction had to play second fiddle to the financial faction in the overall scheme of global one world government.

Until lately, money power triumphed over political power. However, when the entire financial system broke into pieces, it was time to settle scores!

Read for yourself:

Prime Minister Gordon Brown’s remarks at the White House, March 3, 2009

“Well, there’s got to be deep regulatory change. We’ve just been talking, Barack and I, about the need for proper supervision of shadow banking systems, of areas where there was bank practices that were unacceptable, where remuneration policies got out of hand and weren’t based on long-term success, but on short-term deals. And these are the changes that we’ve already announced that we are going to make.”

We’ve had a global banking failure, and it’s happened in every part of the world. It’s almost like a power cut that went right across the financial system. And we have got to rebuild that financial system. We’ve got to isolate the bad assets.”

You don’t want shadow banking systems. You don’t want regulatory tax havens. So we’ve got to act as a world together to deal with that. And that’s one of the things we’ll be talking about in April in London.”

President Obama’s response at the White House, March 3, 2009

Now, having said that, the banking system has been dealt a heavy blow. It has to do with many of the things that Prime Minister Brown alluded to: lax regulation, massive over-leverage, huge systemic risks taken by unregulated institutions, as well as regulated institutions. And so there are a lot of losses that are working their way through the system. And it’s not surprising that the market is hurting as a consequence. In fact, I think what we’re seeing is that as people absorb the depths of the problem that existed in the banking system, as well as the international ramifications of it, that there’s going to be a natural reaction.”

We are cleaning up that mess. It’s going to be sort of full of fits and starts in terms of getting the mess cleaned up, but it’s going to get cleaned up.”

Prime Minister Gordon Brown’s Speech to Congress, March 4, 2009

“And we need to understand what went wrong in this crisis, that the very financial instruments that were designed to diversify risk across the banking system instead spread contagion across the globe. And today’s financial institutions are so interwoven that a bad bank anywhere is a threat to good banks everywhere.”

“And you are also restructuring your banks. So are we. But how much safer would everybody’s savings be if the whole world finally came together to outlaw shadow banking systems and offshore tax havens?

Blink and read again the underlined words. You have just read that Prime Minister Gordon Brown has made the call to “outlaw the shadow banking system and offshore tax havens!


Even if you are a skeptic and holds the view that the quotes are mere spin to delude the people, you cannot deny that Prime Minister Brown has let the genie out of the bottle!

Whether there are any follow through actions by President Obama and Prime Minister Brown, the global citizens must take action independently, if they want to save their children, and their children’s children from decades of impoverishment and extreme hardship.

The most powerful leader of the Western world and his side-kick has openly and unreservedly acknowledged that we are having a global financial melt-down. And that the cause for this catastrophe is the shadow banking system!

There is now an open warfare between the political factions and the financial factions of the global power elites. This will be ugly. And as President Obama warned, “they are gearing for a fight ” He has also responded to the challenge: “So am I.”

Given the above scenario, we must first take out the financial elites, and thereafter the political faction, failing which we will all plunge into the black hole of financial Armageddon!

Matthias Chang is a prominent barrister, author and analyst of the New World Order based in Malaysia.
His website:

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This is the original black forest cake recipe by master pastry cook and confectioner Josef Keller (1887-1981) from Radolfzell (Lake Constance, Germany). The world renowned gateau was supposedly created in Bad Godesberg, at the former celebrity cafe Agner.


For a 24-Er-Springform

4 Eggs
100 g Sugar
100 g Butter
150 g Dark Chocolate
3 Tbsp Black Forest Kirsch (Liquor)
50 g Flour
50 g Potato Flour
1 Tsp Baking Powder
1 Pinch of Salt
150 g Ground Roasted Hazelnuts


½ l Cream
1 Pkt. Vanilla Sugar (or Vanilla Essence)
1/8 l Black Forest Kirsch (Liquor)
750 g Red Cherries
50 g (-80 g) Grated Chocolate


Stir eggs and sugar well until smooth. Add the lukewarm runny butter, the melted chocolate  (using the double-boiler method, melt chocolate with 2 tbsp of water) and the Kirsch. Mix flour, baking powder, salt and potato flour and sieve. Dry roast the ground hazelnuts in a pan untll they are light brown.

Gently mix flour and hazelnuts into the egg-sugar mix and pour all into the pre-buttered springform. Bake at medium heat (190 °C) for 45 minutes. After the cake base has cooled down, cut it twice horizontally. Whip cream and vanilla sugar (or vanilla essence and sugar to taste).

Soak the cake layers with Kirsch and cover the two bottom ones with 1cm of whipped cream. Spread the drained cherries over it and press them gently into the whipped cream. Assemble the parts to form the cake (including the top part). Cover the whole cake generously with cream and decorate with grated chocolate. If so desired, one can add cream of tartar or dissolved (cooled down) gelatin to the cream to ensure the filling will remain firm over an extended period of time.

[Translated from German into Englisch; original recipe on Webkoch]