Thursday, June 29, 2017

Anticipating Big Mistakes

Observing Human Actions,

Seymour Hersh, who broke the My Lai Massacre story when I was in 7th grade, and busted the false-flag Sarin attack in Syria a few years ago, always gets his facts and sources straight before breaking a story, so it takes awhile. Here is as good and clear and detailed a version of the events of early April, when the Syrian air force hit an ISIS meeting in a place that had chlorine for cleaning dead bodies, bombs and agricultural supplies (organophosphates) stored. The US was notified ahead of the specifics. All the military and spooks knew there was never any Sarin, but President Trump was energized by the TV news and saw a moment to catch the wave by bombing Syria. The "Gorilla Option" was chosen (beat chest and bellow). The Russians were advised ahead of time, so they advised the Syrians. Fuel was blown up. Most missiles never got there. Only broken planes got blown up in hangars. The intelligence and military people reportedly didn't like this decision. (Hersh had to get this published in Germany. Go figure.) Thanks Ray.

After recent hype, the Trump Administration seems to be walking back that red-line about another chemical weapons attack in Syria.

Russia and Islam, Connecting the Dots and Discerning the Future
Oh, this is really good and deep. Russia solved the Chechan-rebel problem by making Sunni Islam strong and healthy within Russia, and not the radical Salafist Wahhabi faction, not at all. This strong, healthy and integrated Islam is presented here as the biggest threat to the Saudi backed Islamic reactionary extremists.
This is a long article, but with excellent focus. All the information is useful. Thanks Eleni.

Saudi Arabia, the UAE, Bahrain and Egypt still stand prepared to eject Qatar from the Gulf Cooperation Council if Qatar does not accept becoming a Saudi satellite and accepting Saudi foreign-policy, and muzzling Al-Jazeera, as well as ejecting those Turkish soldiers. This is an ultimatum. Qatar said "non" and will keep resisting it. 
(Turkish Muslim Brotherhood government really must support Qatar's Muslim Brotherhood. Germany also seems to support Qatar. Israel showed support for Saudi Arabia's ruler recently with those fighter jets, but Israel really supports Israel. Mohammad Bin Salman, Saudi Arabia's impetuous crown Prince, architect of the war against Yemen, is not good at listening to prudent counsel. He wants that big gas field between Qatar and Saudi Arabia. He wants to be in the pipeline-to-Europe party. Turkey is the critical member. Syria won't let an enemy pipeline through, and Syria is going to stand, not fall. The obvious fix is to get Qatar and Iran and Syria on the same side, cut out the House of Saud, and pipe all the natural gas to Europe ASAP and until it runs out. Saudi attack on Qatar could be like Iraqi attack on Kuwait.)

The Syrian tension between the US and Russia has increased since the US shot down a Syrian plane, which had been attacking retreating ISIS forces. The pilot is alive and pictured here. What the Russians said is that they would track any planes or drones in Syrian airspace as targets, meaning that a pilot would keep hearing that he is targeted on the special radar that guides the deadly S-300 and S-400 missile systems, and could die within 30 seconds or so. It's hard to concentrate. (Not stated here is the effectiveness of Russian electronic measures in causing US military systems to suddenly fail. Less dramatic. Equally destructive.)

Cardinal Pell, the Vatican Finance Chief, has been charged with multiple sexual assaults on children, after a long investigation in Australia. (Pedophilia is one of the ties-that-bind in the networks of elite power. The sharing of this secret binds together those who know they cannot otherwise trust each other. It's in the US, too. Comet Ping Pong "Pizzagate" may still be investigated in this administration, the nuclear-option of domestic politics.)

John Podesta answers some questions in a closed door session with House Intelligence Committee. (He'd better make some deals to guaranty his own safety, if he gets such a nice option, which he shouldn't. Tortured lizard...)

"Prestitutes, not Russia, interfered in the US election", Paul Craig Roberts

In California, where there is a Democratic super-majority in Congress, and a Democratic governor, who vigorously supported single-payer health insurance in 1992, there is nothing to stand in the way of this momentous transformation, except Democrats. It won't be voted on this year, so all the "supporters" won't be forced to vote against it by their real backers. Jerry Brown must also be relieved not to be put on the spot.

Does Janet Yellen, who does not believe she will "see another financial crisis in her lifetime" have late stage pancreatic cancer? 
Just askin'. Desperate statement, isn't it?

Professor Steve Keen says there is no place for Yellen's complacency. He's being polite. He knows that she knows: 
"She knows who Minsky was. She has spoken at conferences at the Levy Institute at Bard College, in upstate New York, where Minsky worked for his final years. She gave a speech there just 18 months after the crisis began, at a conference named after Minsky, in which she praised Minsky."

If we don't change the way money is created, rising inequality and social disorder are inevitable, Charles Hugh Smith 
(Wealth is sucked form workers and producers and golden-showered upon financial elites.)

UK government announces that it won't pay to remove flammable covering from high rise apartments. The locals will have to pay for it, but they are already broke and over-extended. (We still don't know how many died at Grenfell Tower. They have to leak it out little by little to avoid riots.)

Losing Class War

Monday, June 26, 2017

Good To The Last Drop

Eating Seed Corn,

"The Dynamics of Depletion" looks again at something which is counter-intuitive, how gas/petrol can be cheap, when the economy is grinding down, and there is plenty of oil, and no more oil exploration.
We have economic models based upon equilibrium, and we are used to lumping the costs and payoffs in one pot and sort of leaving time out of it. It's a lot easier than trying to calculate uncertain time lags on everything, which is what really happens.
Credit based money is hard t understand, and does a very good job of obscuring the real dynamics. That serves the ruling class, as a rule.
The economy we have grew up on oil that was cheap to extract.
The price of oil went up with costs until the 2008 financial collapse. Costs of exploration and extraction were rising, and companies raised prices to stay in the black, up to $140/bbl. The system collapsed, and became wholly based upon central bank interventions and promises for the rosy future.
With interest rates near zero, oil was seen as an excellent investment, so lots of money was shunted into it, especially shale, but all the profits were in the future. Then in late 2014 the oil prices dropped again, and they have stayed down, and all the profits are still in the future. There's no exploration to speak of.
This puts the fossil fuel economy in terminal decline, and the cookie jar empty.
What is observed here is what I have also noted, the rich have to take the huge losses, because they have the huge imaginary portfolios. We will all have to endeavor to scrape by much more efficiently, more like the Flintstones than the Jetsons. 

Trump wants to sell oil leases in the Arctic National Wildlife Refuge. There is apparently a super-giant oil and gas field under it. The oil-majors are keeping secret the results of the one test well drilled long ago. How can it not get pumped?

The Fed announces that they will raise interest rates, and/or tighten policy through unwinding QE (ceasing to roll-over assets when they mature, marketing them, instead) until asset prices start falling. 
Personally, I think global central banking has gotten positioned for the long deflation. They will no longer collect interest, but they will take position of assets, everything of value. This is like the 1800s strategy. Bankrupt borrowers and take their farms.

The Bank for International Settlements states that years of record low interest rates have set the world up for a big crash when rates are raised, as they currently recommend. That's not a bug, it's a feature Bankers rule.

Charles Hugh Smith looks at the date a hedge fund executive has set for the stock market crash, Valentine's Day 2018. It's as good a date as any. Charles looks at the psychological steps that take place in the classic head-and-shoulders collapse of asset prices here.

Julian Assange says the Democratic Party is doomed by the financially-captured establishment, which serves no purpose but it's own, and that of the financial masters. People with real democratic leanings will have to form a new Democratic party, along the populist lines that Bernie Sanders was presenting. (Those lines may move a lot by 2020.)

Monsanto and Bayer (now merged) seem to have a strategy to take over the marijuana market. (I suspect they found a way to make pot addictive, too.)

This study comparing pot smokers and non-smokers in California and Colorado finds that the pot smokers are happier, healthier, richer, more likely to volunteer in their communities, and have a lot more masters degrees. (Do you think that's because these are the people who care to take the whole route to legal marijuana, with all the time and expense? Pot doesn't make you educated, rich or happy.)

Disgruntled Populist

Sunday, June 25, 2017

Divided And Conquered

Taken for a Ride,

Jim Kunstler looks at the very-expensive medical-care bubble in the US.
(The funniest claim about ObamaCare in today’s New York Times is the statement that 20 million citizens got access to health care under the so-called Affordable Care Act. Really? You mean they got health insurance policies with $8000-deductables, when they don’t even have $500 in savings to pay for car repairs? What planet do The New York Times editorial writers live on?)
Spare yourself the angst of even worrying about the outcome of the current healthcare debate. It’s not going to get “fixed.” The medical system as we know it is going to blow up, and soon, just like the pension systems across the country, and the treasuries of the fifty states themselves, and the rest of the Potemkin US economy.

A United Nations report has shed light on the world’s burgeoning crisis of displaced peoples, finding that a record 65.6 million were forced to vacate their homes in 2016 alone. More than half of them were minors. The top countries have one thing in common. They were all targets of US intervention.
http://theantimedia.org/us-intervention-un-report-refugees/
Senator Rand Paul takes a clear stand: Some people, Paul noted, say that “you got all the Article II, and it would just be nice to have an AUMF [Authorization of Use of Military Force]. “No, it wouldn't be nice. That's the Constitution. There's supposed to be no war without an AUMF. We have been illegally at war for a long time now. This is illegal war, at this point,” he said. Thanks Eleni.

The situation in Syria is not complicated. Here's what you need to know. From April 10, still right on. Just look at the bullet-points... (OK, the US government and media-for-profit are lying to us, the US is supporting terrorists and paying them to keep changing their names, and the US and Israel specialize in false-flag attacks. Payoff is control of gas-pipeline-to-Europe, a big rent-extraction scheme.)

Here is an update on the war in Syria, where US proxy-bad-guys are falling too fast to Syrian Army, Iranian and Lebanese forces, before the US can get in there and root them out, and take control of what they control. Also, Iranian ballistic missiles, fired from Iran, are impressively accurate against ISIS targets far away in Syria.

Moon of Alabama has the maps and details, which I really found useful. The speed at which the Syrian and Russian forces are advancing on ISIS strongholds is making US claims of needing to help fight ISIS fall flat. The plane shot down by the US last week was a poor decision. The pilot is reported rescued behind ISIS lines here. I expect US drones to get shot down, but we may not be told.

It looks like the US is having to give up on training Arab mercenaries in al-Tanf, Syria, near the Jordanian border, an important crossroad. American-proxy SE Syria invasion is in-retreat.

Israel has been providing artillery and other supporting fire against the Syrian Government, to aid al-Qaeda mercenaries which it supports, for 3 years.
The person familiar with Israel’s assistance confirmed that cash moves across the border but said it goes for humanitarian purposes. However, rebels interviewed said they use the cash to pay fighters’ salaries and to buy weapons and ammunition—something the Israeli military wouldn’t comment on.

America supervises it's Persian Gulf Allies, like Saudi Arabia and the UAE, as they torture Yemeni prisoners off shore, and things like that. Yes, our friends in the region support certain armed factions, and so do we, and no, we don't call them that name, or that other name any more.

The Saudi/Qatar Spat, An Offer to be Refused: Moon of Alabama likens this to the start of WW-1, but it may not progress. 
(What I keep seeing is that the House of Saud is trying to cut out the Muslim Brotherhood. Turkey is a Muslim Brotherhood State, and Qatar has a small Turkish garrison, which Saudi Arabia demands they expel. Huh? The Turkish army sucks after Erdogan culled all the disloyal officers, but it's still a lot better than the Saudi military. Political support for the Saudi regime is a mile wide and an inch deep. It will support whoever delivers the oil. The US and Israel can switch sides. They really can... Give them a chance to support Turkey.)

Saudi Hypocrisy, Golem XIV:
The Great Gas War is gathering towards a major escalation. The Northern Front in Ukraine has gone quiet. Or at least unreported. But its Southern Front from Syria to Yemen, Turkey to Iran is hotting up.

Mohammad Bin Salman is the new Saudi Crown Prince, suddenly installed. He has been in charge of the military and running the war against Yemen for the past couple of years. He got a performance-raise. They say this 31 year old was raised spoiled, and doesn't listen to advice, but he seems to hold all the reins of power. What could go wrong?

Israel deployed 18 fighter jets to Saudi Arabia to prevent a coup when Bin Salman's incipient-despothood was announced. Other members of the Saudi family seethe. It's a big family, and everybody wants to be king, or have his (full) brother be king. (The House of Saud used to care what other Arab nations thought, but now openly consorts with Israel.)

73% of Americans think the "Russia Probes" are a distraction, and 64% believe they are harmful to the US.

Tired of the Lies

Saturday, June 24, 2017

American Deep State Origins

Subjects of the American Empire,

Jada Thacker has just published the clearest explanation of the finances and class-warfare involved in the American Revolution and the Constitutional Convention that I have ever seen. It all seems so obvious and normal and deceitful and manipulative to me. It's the same as today. Makes perfect sense. 

Student of History

Here's Jada:

Deep History of America’s Deep State

 
Exclusive: The idea of an elitist Deep State – erasing a “mistake”  by the people – pervades current efforts to remove buffoonish President Trump, but the concept has deep historical roots dating from the Founding, writes Jada Thacker.
By Jada Thacker
Everybody seems to be talking about the Deep State these days. Although the term appears to have entered the lexicon in the late 1990s, for years it referred only to shady foreign governments, certainly not to our own “indispensable nation.”
An artist’s rendering of the Constitutional Convention in 1787
Does the sudden presence of an American Deep State – loosely defined as an unelected elite that manipulates the elected government to serve its own interests – pose a novel, even existential, threat to democracy?
Not exactly. The threat seems real enough, but it’s nothing new. Consider these facts: 230 years ago, an unelected group of elite Americans held a secretive meeting with an undisclosed agenda. Their purpose was not merely to manipulate lawful government in their own interests, but to abolish it altogether. In its place, they would install a radically undemocratic government – a “more perfect” government, they said – better suited to their investment portfolios.
History does not identify these conspirators as the Deep State. It calls them the Founders. The Founders did not consider themselves conspirators, but “republicans” – not in reference to any political party, but rather to their economic station in society. But their devotion to “republicanism” was transparently self-serving. A current college text, The American JourneyA History of the United States, explains though does not explicate “republican ideology”:
“Their main bulwark against tyranny was civil liberty, or maintaining the right of the people to participate in government. The people who did so, however, had to demonstrate virtue. To eighteenth century republicans, virtuous citizens were those who were focused not on their private interests but rather on what was good for the public as a whole.
They were necessarily property holderssince only those individuals could exercise an independence of judgment impossible for those dependent upon employers, landlords, masters, or (in the case of women and children) husbands and fathers.” [Emphasis supplied]
Republicanism was a handy idea if you happened to be a master or a landlord, who were the only persons this ideology considered “virtuous” enough to vote or hold political office. Thus, “republicanism” – virtually indistinguishable from today’s “neoliberalism” – created the original Deep State in the image of the economic system it was designed to perpetuate.
How this was accomplished is not a comforting tale. But it cannot be related nor understood without an appreciation of the historical context in which it occurred.
Masters and Servants
Post-colonial America was predominantly agrarian, and about 90 percent of the population was farmers. (The largest city in 1790 was New York, with a whopping population of 33,000 residents.) There was a small middle class of artisans, shopkeepers, and even a handful of industrial workers, but the politically and economically powerful people were the relatively few big-time merchants and landowners – who also fulfilled the function of bankers.
Gouverneur Morris, a delegate to the Constitutional Convention and a key drafter of the Preamble. (Painting by Edward Dalton Marchant)
America was not quite a feudal society, but it resembled one. Commoners did not call at the front doors of the rich, but were received around back. Most states had official religions, some with compulsory church attendance backed by fines. Commodity-barter was the currency of the day for the vast majority. Debtors were imprisoned. Parents sold their children into bondage. It wasn’t what most people think of when they hear “Yankee Doodle Dandy.”
All states restricted voting only to men who owned a requisite amount of property, while the majority: un-widowed women, servants, and tenants owned no property. Moreover, most states had property requirements for eligibility to elective office, some with the higher offices reserved for those with the most property. Such restrictions had discriminated against the urban underclass and farmers since the beginning of American colonization.
Nobody at the time characterized this land of masters and servants as a “democracy.” Indeed, the master class considered “democracy” synonymous with “mob rule.” But not everybody was happy with “republican virtue” in post-war America, least of all the slaves of the “virtuous.”
The Revolutionary War had stirred passions among the servant class for social and economic liberty, but when the war ended nothing much had changed. In fact, the war proved not to have been a revolution at all, but represented only a change from British overlords to American overlords. Edmund Morgan, considered the dean of American history in the colonial era, characterized the “non-Revolutionary War” this way:
“The fact the lower ranks were involved in the contest should not obscure the fact that the contest itself was generally a struggle for office and power between members of an upper class: the new against the established.”
About 1 percent of the American population had died in a war fought, they had been told, for “liberty.” (Compare: if the U.S. lost the same proportion of its population in a war today, the result would be over three million dead Americans.) Yet after the war, economic liberty was nowhere in sight.
Moreover, the very concept of “liberty” meant one thing to a farmer and quite another to his rich landlord or merchant. Liberty for a common farmer – who was generally a subsistence farmer who did not farm to make money, but rather only to provide the necessities of life for his family – meant staying out of debt. Liberty for merchants and property owners – whose business it was to make monetary profits – meant retaining the ability to lend or rent to others and access to the power of government to enforce monetary repayment from debtors and tenants.
Much like the American Indians who had first communally owned the property now occupied by American subsistence farmers, agrarian debtors faced the unthinkable prospect of losing their ability to provide for their families (and their vote) if their land were confiscated for overdue taxes or debt. [See Consortiumnews.com’s “How Debt Conquered America.”]
Loss of their land would doom a freeholder to a life of tenancy. And the servitude of tenants and slaves differed mainly as a function of iron and paper: slaves were shackled by iron, tenants were shackled by debt contracts. But iron and paper were both backed by law.
By the end of the Revolutionary War, as few as a third of American farmers owned their own land. When the urban elites began to foreclose on the debts and raise the taxes of subsistence farmers – many of whom had fought a long and excruciating war to secure their “liberty” – it amounted to a direct assault on the last bastion of Americans’ economic independence.
The Original Great Recession
After the war, British merchants and banks no longer extended credit to Americans. Moreover, Britain refused to allow Americans to trade with its West Indies possessions. And, to make matters worse, the British Navy no longer protected American ships from North African pirates, effectively closing off Mediterranean commerce. Meanwhile, the American navy could not protect American shipping, in the Mediterranean or elsewhere, because America did not happen to possess a navy.
George Washington crossing the Delaware, in Emanuel Leutze’s iconic (though historically inaccurate) painting
In the past, American merchants had obtained trade goods from British suppliers by “putting it on a tab” and paying for the goods later, after they had been sold. Too many Americans had reneged on those tabs after the Revolution, and the British now demanded “cash on the barrelhead” in the form of gold and silver coin before they would ship their goods to America.
As always, Americans had limited coin with which to make purchases. As the credit crunch cascaded downwards, wholesalers demanded cash payment from retailers, retailers demanded cash from customers. Merchants “called in” loans they had made to farmers, payable in coin. Farmers without coin were forced to sell off their hard-earned possessions, livestock, or land to raise the money, or risk court-enforced debt collection, which included not only the seizure and sale of their property but also imprisonment for debt.
The most prominent result of Americans’ war for “liberty” turned out to be a full-blown economic recession that lasted a decade. Even so, the recession would not have posed a life-threatening problem for land-owning subsistence farmers, who lived in materially self-sufficient, rural, communal societies. But when state governments began to raise taxes on farmers, payable only in unavailable gold and silver coin, even “self-sufficient” farmers found themselves at risk of losing their ability to feed their families.
Debt, Speculation, and the Deep State
The Continental Congress had attempted to pay for its war with Britain by printing paper money. The British undermined these so-called “Continental” dollars, not only by enticing American merchants with gold and silver, but by counterfeiting untold millions of Continental dollars and spending them into circulation. The aggregate result was the catastrophic devaluation of the Continental dollar, which by war’s end was worthless.
In the meantime, both Congress and state governments had borrowed to pay for “liberty.” By war’s end, war debt stood at $73 million, $60 million of which was owed to domestic creditors. It was a staggering sum of money. In his now studiously ignored masterpiece, An Economic Interpretation of the Constitution of the United States, historian Charles A. Beard showed that domestically-held war debt was equivalent to 10 percent of the value of all the surveyed land holdings (including houses) in the entire United States at the time.
The war debt carried interest, of course – which is a problem with debt if you owe it, but is a feature of debt if it is owed to you. Not only was “freedom not free” – it came with dividends attached for Deep State investors. This should sound at least vaguely familiar today.
President George Washington
As Continental paper money lost its value, Congress and state governments continued to pay for “liberty” with coin borrowed at interest. When that ran short, government paid only with promises to pay at a later date – merely pieces of paper that promised to pay coin (or land) at some indeterminate time after the war was won.
This was how the government supplied the troops (whenever it managed to do so) and also how it paid its troops. In actual practice, however, Congress often did not pay the troops anything, not even with paper promises, offering only verbal promises to pay them at the end of the war.
But war is never a money-making enterprise for government, and when it ended, the government was as broke as ever. So, it wrote its verbal promises on pieces of paper, and handed them to its discharged troops with a hearty Good Luck with That! Even so, Congress paid the soldiers in bonds worth only a fraction of the amount of time most had served, promising (again!) to pay the balance later – which it never did.
Thousands of steadfast, longsuffering troops were abandoned this way. Most had not been paid any money in years (if ever), and many were hundreds of miles from their homes – ill, injured, and starving – as they had been for months and years. Others literally were dressed only in rags or pieces of rags. Some carried paper promises of money; some carried paper promises of geographically distant land – none of which would be available until years in the future, if at all.
Seven-year Revolutionary War veteran Philip Mead described his plight in a bitter memoir entitled A Narrative of Some of the Adventures, Dangers and Sufferings of a Revolutionary Soldier: “We were absolutely, literally starved. I do solemnly declare that I did not put a single morsel of victuals in my mouth for four days and as many nights, except a little black birch bark which I gnawed off a stick of wood, if that can be called victuals. I saw several of the men roast their old shoes and eat them….
“When the country had drained the last drop of service it could screw out of the poor soldiers, they were turned adrift like old worn-out horses, and nothing said about land to pasture them on.”
Was this liberty? To impoverished veterans, “liberty” looked bleak, indeed. To speculators in government bonds, liberty looked like a golden opportunity, quite literally so.
Vultures possessed of coin swooped in and bought a dollar’s worth of government promises for a dime, and sometimes for just a nickel. Speculators wheedled promises not only from desperate veterans (many of whom sold their promises merely to obtain food and clothes on their long trudge home), but from a host of people whose goods or services had been paid with IOUs.
Optimistic speculators cadged bonds from pessimistic speculators. The more desperate people became during the recession, the more cheaply they sold their promises to those who were not.
Speculators expected their investments, even those made with now-worthless paper money, to be paid in gold or silver coin. What’s more, “insiders” expected all those various government promises would eventually be converted – quietly, if possible – into interest-bearing bonds backed by a single, powerful taxing authority. All the Deep State needed now was a national government to secure the investment scheme. A man named Daniel Shays unwittingly helped to fulfil that need.
Rebellion and Backlash
Thomas Jefferson penned the famous sentence: “The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.” He was not referring to heroic American Patriots charging up Bunker Hill against British bayonets. He was referring instead to American farmers – many of whom had been the starving soldiers in a war for forsaken liberty – taking their lives into their hands to oppose the tax policies of the government of Massachusetts in 1787. The principal leader of this revolt was a farmer and war veteran Daniel Shays.
General Benjamin Lincoln who led a force in 1787 to put down Shays’ Rebellion in western Massachusetts. (Painting by Charles Willson Peale)
In a sense, the most interesting thing about Shays’s Rebellion is that it was not a unique event.
The first notable example of agrarian revolt had been Bacon’s Rebellion in 1676 Virginia, when frontier farmers marched on the rich plantation owners of Jamestown, burned it to the ground, published their democratic “Declaration of the People,” and threatened to hang every elite “tyrant” on their list – which included some of the forefathers of America’s patriot Founders.
Historian Gary Nash reminds us Bacon’s Rebellion had echoes across early American history: “Outbreaks of disorder punctuated the last quarter of the 17th century, toppling established governments in Massachusetts, New York, Maryland, Virginia, and North Carolina.” Jimmy Carter, in The Hornet’s Nest, the only novel ever published by an American president, tells a similar story of the agony of dispossessed farmers in Georgia a century later.
Other farmers had rebelled in New Jersey in the 1740s; in the New York Hudson Valley rent wars in the 1750s and 1760s and concurrently in Vermont by Ethan Allen’s Green Mountain Boys; for a decade in North Carolina in the 1760s, where vigilantes called Regulators battled the government of the urban elite; and in Virginia in the 1770s. Likewise, American cities had been scenes of labor unrest, riots, and strikes for a century. American class rebellion, apparently unbeknownst to most history teachers in America, was closer to the rule than the exception.
Victory in the war against England only intensified the conflict between those who considered “liberty” as a necessary condition to live without debt, against those who considered “liberty” to be their class privilege to grow rich from the debts others owed them. Howard Zinn, in his A People’s History of the United States describes the economic realities of Eighteenth Century America:
“The colonies, it seems, were societies of contending classes – a fact obscured by the emphasis, in traditional histories, on the external struggle against England, the unity of colonists in the Revolution. The country therefore was not ‘born free’ but born slave and free, servant and master, tenant and landlord, poor and rich.”
Although Shays’s Rebellion was not unique, it was a huge event, coming at a time when the rich were owed a great deal of money by impoverished governments. Pressured by rich bondholders and speculators, the government of Massachusetts duly raised taxes on farmers. To make matters far worse, the taxes were to be paid only in gold or silver – which was completely out of the question for most western farmers, who had no way to obtain coined money.
When the farmers complained, their complaints were ignored. When farmers petitioned the government to issue paper money and accept it as payment of debts and taxes, the government refused their petitions. When the farmers pleaded for the passage of “legal tender laws” that would allow them to settle their debts or taxes with their labor, they were rebuffed.
But when farmers could not pay what they did not have, the Massachusetts’s courts ordered their land seized and auctioned. At last, the farmers understood the practical effect, if not the specific intent, of the tax: confiscation of their property and its transfer to the rich, to whom the government owed its interest-bearing debt. Government had become an armed collection agency.
To the utter dismay of the erstwhile proudly tax-rebellious Patriots, the farmers too rebelled. Shaysites forcibly shut down the tax courts that were condemning them to servitude. The rich responded by loaning the destitute government more money (at interest!) to pay a militia force to oppose Shays’s rebels.
At this point, tax rebels abandoned reform for radical revolution and – in a resounding echo of Nathaniel Bacon’s century-old Declaration of the People – pledged to march on Boston and burn it to the ground. This was no Tea Party vandalism, stage-managed by well-to-do Bostonians like Samuel Adams. It was a full-blown, grassroots agrarian revolution a century in the making.
The urban bond-holding merchant-class in Boston and elsewhere panicked. And none panicked more than bond speculators, who intimately understood the rebels threatened their “virtuous” republican “liberty” to extract profit from others. Historian Woody Holton exposes the astonishing callousness of one of America’s major bond speculators in his nationally acclaimed Unruly Americans and the Origin of the Constitution:
“As a bondholder, Abigail Adams would benefit immensely if her fellow Massachusetts citizens [paid the tax] levied by the legislature in March 1786, but she also saw compliance as a sacred duty. If Massachusetts taxpayers were ‘harder-prest by publick burdens than formerly,’ she wrote, ‘they should consider it as the price of their freedom’.”
Abigail Adams, wife of the second President John Adams, in a portrait by Benjamin Blythe.
Future First Lady Abigail Adams was not alone in thinking freedom came with dividends payable to her account. Historian David Szatmary reminds us in his Shays Rebellion; The Makings of an Agrarian Insurrection that the former Patriot leadership, especially those in the merchant class, were among the first to advocate violence against democratic rebellion.
Said a published opinion piece at the time: “When we had other rulers, committees and conventions of the people were lawful – they were then necessary; but since I myself became a ruler, they cease to be lawful – the people have no right to examine my conduct.”
Showboat Patriot and bond speculator Samuel Adams –former mastermind of the Boston Tea Party and erstwhile propagandist against unfair British taxes (as well as cousin to Abigail’s husband John Adams) – sponsored a Massachusetts law that allowed sheriffs to kill tax protesters outright.
Another rich bondholder and speculator, ex-Revolutionary War General Henry Knox (the fitting namesake of Fort Knox, the famous repository of gold bullion) wrote an alarming letter to his former commander George Washington, accusing the Shays’s rebels of being “levelers” (which was the closest term to “communists” then in existence). He informed Washington that the country needed a much stronger government (and military) to prevent any riffraff challenge to the elite. His message was not wasted on General Washington, America’s richest slave owner.
In the end, the Congress, under the Articles of Confederation, could raise no money from the states to provide an army, but the privately-financed, for-profit Massachusetts militia successfully defeated Shays’s rebels. Still, the nearly hysterical fear of democratic economic revolution had been planted in the minds of the masters. Shays’s Rebellion proved to be the last straw for bond speculators whose profits were jeopardized by democracy.
Worse even, the governments of many other states were beginning to cave under intense democratic pressure from rebellious debtors. Some states were entertaining laws that prevented the seizure of property for debt; others were creating paper money in order to break the gold and silver monopoly. Rhode Island not only voted in a paper money system, but threatened to socialize all commercial business enterprises in the state.
In response to the threat of populism, the “virtuous” elite reacted decisively – not to remedy the plight of debtors, of course – but to secure their own profits from them. Accordingly, in 1786, five states sent delegates to meet at Annapolis, Maryland, just as Shays’s Rebellion veered into revolution. This unelected minority called for Congress to authorize a convention to be held in Philadelphia the next year “for the sole and express purpose of revising the Articles of Confederation.” The Articles were never to be “revised.” They were to be scrapped altogether by the Deep State.
The Deep State Conspires
Thanks to Charles A. Beard’s An Economic Interpretation of the Constitution of the United States, we know quite a lot about the status of the 55 men who conspired to draft the Constitution. But the very first thing we need to know is that they were not authorized by “We the People” simply because nobody had voted for them; all were political appointees.
James Madison
Nor were they even a representative sample of the people. Not a single person in the Convention hall “worked for a living,” nor was female, nor was a person of color. Only one claimed to be a “farmer,” the current occupation of about 90 percent of the population. Most were lawyers. Go figure.
If the delegates represented anybody at all, it was the economic elite: 80 percent were bondholders; 44 percent were money-lenders; 27 percent were slave owners; and 25 percent were real estate speculators. Demographically, the 39 who finally signed the final draft of the Constitution constituted .001 percent of the American population reported in the 1790 census. George Washington, who presided, was arguably the wealthiest man in the country. Deep State gamblers all.
And the stakes were high. Recall that the face value of outstanding domestic government bonds in 1787 was $60 million, equivalent to 10 percent of the total improved land value of the country. But these bonds, for the most part, had been obtained by speculators at a fraction of face value. Beard very conservatively estimated the profit of speculators – if the bond were redeemed at face value – would have been some $40 million. Expressed as the same proportion of total improved land value at the time of the Founding, the expected profit from government bonds held then would equal at least $3 trillion today. Tax free.
We still do not know everything that transpired at the convention. No one was assigned to keep a record of what was discussed. Reportedly, even the windows to the meeting hall were nailed shut to prevent eavesdropping – though there would be “leaks.” Because of its secrecy and its unauthorized nature, some historians have called the convention “the second American Revolution.” But revolutions are public, hugely participatory events. This was a coup d’état behind locked doors.
Most delegates presumably understood their undisclosed purpose was to dump the whole system of confederated government (which had cost 25,000 American lives to secure) into a dustbin. They evidently did not intend to obey their instructions “solely to revise” the Articles because a number of them showed up at the convention with drafts for a new constitution in hand.
The conspirators’ ultimate goal was to replace the Confederation with what they later euphemized as “a more perfect Union” – designed from the outset to protect their class interests and to ensure the new government possessed all the power necessary to perpetuate the existing oligarchy.
At the Convention, Alexander Hamilton captured the prevailing sentiment: “All communities divide themselves into the few and the many. The first are the rich and well-born; the other the mass of the people … turbulent and changing, they seldom judge or determine right. Give therefore to the first class a distinct, permanent share in the Government. … Nothing but a permanent body can check the imprudence of democracy.”
A portrait of Alexander Hamilton by John Trumbull, 1792.
Hamilton further proposed that both the President and the Senate be appointed (not elected) for life. His vision was but half a step removed from monarchy. Though not a Convention delegate, John Jay, Hamilton’s political ally, slaveowner, and the first Chief Justice of the Supreme Court, stated the purpose of “republicanism” with brutal brevity: “The people who own the country ought to govern it.”
The Founders never once envisioned any such a thing as “limited government” – unless perhaps in the sense that the power of government was to be limited to their own economic class. [See Consortiumnews.com’s “The Right’s Made-up Constitution.”]
In Towards an American Revolution: Exposing the Constitution & Other Illusions, historian Jerry Fresia sums the Founders’ views succinctly: “The vision of the Framers, even for Franklin and Jefferson who were less fearful of the politics of the common people than most, was that of a strong centralized state, a nation whose commerce and trade stretched around the world. In a word, the vision was one of empire where property owners would govern themselves.” [Emphasis supplied]
Self-government by the people was to remain permanently out of the question. The Deep State was to govern itself. “We the People,” a phrase hypocritically coined by the ultra-aristocrat Gouverneur Morris, would stand forever after as an Orwellian hoax.
The tricky task of the hand-picked delegates was to hammer out a radical new system of government that would superficially resemble a democratic republic, but function as an oligarchy.
William Hogeland’s excellent Founding Finance, recounts the anti-democratic vehemence expressed at the Convention: “On the first day of the meeting that would become known as the United States Constitutional Convention, Edmund Randolph of Virginia kicked off the proceedings […] ‘Our chief danger,’ Randolph announced, ‘arises from the democratic parts of our constitutions. … None of the constitutions’ – he meant those of the states’ governments – ‘have provided sufficient checks against the democracy.’”
No wonder they nailed the windows shut. It should be no surprise that the word “democracy” does not appear once in the entire U.S. Constitution, or any of its Amendments, including the Bill of Rights. Accordingly, the Constitution does not once refer to the popular vote, and it did not guarantee a single person or group suffrage until the adoption of the 15th Amendment in 1870, over 80 years after ratification. The Preamble aside, the Founders used the phrase “the People” only a single time (Art. I, Sec. 2).
It has been suggested the word “democracy” had a different meaning then than it has now. It did not. “Democracy” to the Convention delegates meant the same thing as it does today: “rule by the people.” That’s why they detested it. The delegates considered themselves the patriarchs of “republicanism,” the ideology that rejected participation in government by people like their wives, servants, tenants, slaves, and other non-propertied inferiors. No doubt, the delegates passionately disagreed on many things, but the “fear and loathing” of democracy was not one of them. Then or now.
The Deep State’s Specific Goals
Embedded within the Founders’ broadly anti-democratic agenda were four specific goals. These were not a list of items jotted down in advance, but were derived by group consensus as the minimum requirements necessary to achieve the Deep State’s ultimate agenda.
Thomas Jefferson in a 1800 portrait by Rembrandt Peale.
To camouflage the stark oligarchic nationalism the measures intended, the Founders disingenuously styled themselves “Federalists.” But nothing about these measures concerned a “federation” of sovereign states; taken together, they were intended to demolish the existing “perpetual” confederation, not to re-create it more effectively.
National government with limited citizen participationOf all the measures required to achieve a national oligarchy, this was the most daunting. It was achieved by a wide array of provisions.
The Electoral College. The President and Vice President are not elected by popular vote, but by electors – then and now. For example, when George Washington was first elected President, the American population was 3.9 million. How many of those folks voted for George? Exactly 69 persons – which was the total number of electors voting at the time. (Art. I, Sec. 3)
Bi-Cameral Congress. Congress is bi-cameral, composed of two “houses” – the House of Representatives and the Senate. Under the original Constitution, the House members represented the people who vote for them, while the Senate represented states, not persons, and was therefore not a democratic body, at all. It was generally expected that the Senate would “check” the democratic House. Indeed, this was the entire purpose of bi-cameralism wherever it has existed. (Art. I, Secs. 1 and 2)
State Appointment of Senators. Senators were originally appointed by state legislatures (until the 17th Amendment in 1913). It was expected that the Senate would function in Congress as the House of Lords functioned in Parliament: the voice of the aristocracy. Even though Senators are now popularly elected, it is far more difficult to challenge an incumbent because of the prohibitive expense of running a state-wide campaign. (Art. I, Sec. 3)
Appointment of the Judiciary. All federal judges are appointed for life terms by the President and confirmed by the (originally undemocratic) Senate. (Art. III, Sec. 1)
Paucity of Representation. Most undemocratic of all was the extreme paucity of the total number of House members. The House originally was composed of only 65 members, or one member per 60,000 persons. Today, there are 435 members, each representing about 700,000 persons. Thus, current House representation of the public is 12 times less democratic than when the Constitution was written – and it was poor (at best) then.
Compare: The day before the Constitution was ratified, the people of the 13 United States were represented by about 2,000 democratically elected representatives in their various state legislatures (1:1950 ratio); the day after ratification, the same number of people were to be represented by only 65 representatives in the national government (1:60000). In quantitative terms, this represents more than a 3,000 percent reduction of democratic representation for the American people. (Art. I, Sec. 2)
Absence of Congressional Districts. Although House members now run for election in equal-populated districts, the districts were created by Congress, not the Constitution. Until the 1960s, some House members were elected at-large (like Senators). This disadvantaged all but the richest and best-known candidates from winning. (Not referenced in Constitution)
Absence of Recall, Initiative and Referendum. The Constitution does not allow the people to vote to recall (un-elect) a Congress member, demand a Congressional vote on any issue (propose an initiative) or vote directly in a referendum on any issue (direct democracy). (Not referenced in Constitution)
Absence of Independent Amendment Process. One of the reasons Americans now have professional politicians is that the Constitution does not provide a way for “the people” to amend it without the required cooperation of a sitting Congress. At the Constitutional convention, Edmund Randolph of Virginia (surprisingly) proposed that the people be afforded a way to amend the Constitution without the participation of Congress. This excellent idea, however, was not adopted. (Art. V)
National authority to tax citizens directly. (Art. I, Sec. 8; 16th Amendment)
National monopolization of military power. (Art. I, Sec.8, clauses 12, 13, 14, 15, 16)
Denial of states’ power to issue paper money or provide debtor relief. (Art. I, Sec.10; Art. I Sec.8, clause 4)
All of these provisions were completely new in the American experience. For 150 years or more, citizen participation in government, independent militias, and the issuance of paper money had been the prerogative of the several, independent colonies/states – while direct external taxation had been universally and strenuously resisted. When the British Crown had threatened to curtail colonial prerogatives, the very men who now conspired for national power had risen in armed rebellion. The hypocrisy was stunning. And people took note of the fact.
Consent of the Minority
One of the note-takers was Robert Yates, a New York delegate to the Convention, who had walked out in protest. Not long afterwards, Yates (who owned no government bonds) stated his objection to the new Constitution: “This government is to possess absolute and uncontrollable power, legislative, executive and judicial, with respect to every object to which it extends. …
“The government then, so far as it extends, is a complete one. … It has the authority to make laws which will affect the lives, the liberty, and the property of every man in the United States; nor can the constitution or the laws of any state, in any way prevent or impede the full and complete execution of every power given.”
A photograph showing the whipping scars on the back of an African-American slave.
At least half of the American population (collectively called “Anti-federalists”) thought the Constitution was a terrible idea. To be sure, well-to-do Anti-federalists like Yates were not overtaxed farmers, and their objections were often based upon the defense of states’ rights, not peoples’ economic rights. Most Anti-federalists, however, seemed alarmed that the Constitution contained no guarantee of the basic political rights they had enjoyed under the British Empire, such as freedom of speech or trial by jury.
The debate between supporters and critics of the Constitution raged for a year, while partisan newspapers published articles both pro and con. A collection of 85 “pro” articles is known now as The Federalist Papers, which were written by Alexander Hamilton, James Madison and John Jay. Although these articles have been studied almost as religious relicts by historians, they do not tell us “what the Constitution really means.”
The Constitution means what it says. The Federalist Papers are sales brochures, written by lawyers trying to get others to “buy” the Constitution. The same can be said about a similar collection of “Anti-federalist Papers,” from which Yates’s quote above was taken. In any event, it is up to the courts to interpret the Constitution, not lawyers with vested interests.
In due course, the Anti-federalists put their collective foot down. There would be no hope of ratification without amendments guaranteeing fundamental political – but not economic – rights. Although Hamilton argued a guarantee of rights would be “dangerous,” James Madison convinced the Federalists that agreeing to guarantee a future Bill of Rights would be much safer that meddling with the text of the current document, which might entail unraveling its core nationalist, anti-democratic agenda. And so, a deal was struck.
Even so, the battle over the ratification of the Constitution was not ultimately decided by the people of the nation. Although the people of the several states had not voted to authorize the Convention, or the document it had produced, the Founders had been incredibly arrogant, not to mention sly. Not only had they presented the unauthorized document to the states as a take-it-or-leave-it proposition (no changes allowed), but the document itself demanded that only special state “conventions” could ratify it – not the majority popular vote of the people.
Specifying ratification by conventions meant the people would be voting for convention delegates, who would in turn vote for ratification. This was tantamount to turning ratification into a popularity contest between convention delegates, rather than a democratically direct vote on the document, itself. Moreover, ratification by convention would present the possibility that a minority of the people in a state (those in favor of the Constitution) might “pack” a convention with delegates, who would then approve of a document establishing a government for all.
Electoral shenanigans were not just hypothetical possibilities. In Philadelphia, for example, a mob kidnapped elected legislators who were boycotting a convention vote, physically dragged them into the state house, and tied them to their chairs in order to force a convention vote. Other, more subtle methods of manipulation occurred elsewhere, notably the disenfranchisement of voters through property qualifications.
Over a hundred years ago, Charles A. Beard completed his exhaustive study of the Constitution and confirmed that it most likely was ratified by a majority – of a minority of the people.
Among Beard’s final conclusions were these: “The Constitution was ratified by a vote of probably not more than one-sixth of the adult males….The leaders who supported the Constitution in the ratifying conventions represented the same economic groups as the members of the Philadelphia Convention….The Constitution was not created by ‘the whole people’ as the jurists [judges] have said; neither was it created by ‘the states’ as Southern nullifiers long contended; but it was the work of a consolidated group whose interests knew no state boundaries and were truly national in their scope.”
The Deep State, in other words. It was darkly appropriate that a document whose primary purpose was to defeat democratic rule was, itself, brought into force without a majoritarian vote.
In 1788, nine of the 13 states’ conventions ratified the Constitution (as specified in the Constitution’s own Article VII) and the document became the supreme law of the land for those nine states. By 1789, even the democratic holdout Rhode Island had followed suit. And America’s schoolchildren have been led to believe ever since that the Constitution is a sacred document, inspired and ordained by the public-spirited benevolence of Founding Fathers.
But this had been predicted. It had seemed painfully obvious to Eighteenth Century Genevan political philosopher Jean-Jacques Rousseau that constitutional government was the invention of the Deep State, its designated beneficiary.
Dripping with sarcasm, his virtuoso Discourse on Inequality explained the process: “[T]he rich man … at last conceived the deepest project that ever entered the human mind: this was to employ in his favour the very forces that attacked him, to make allies of his enemies…
“In a word, instead of turning our forces against ourselves, let us collect them into a sovereign power, which may govern us by wise laws, may protect and defend all the members of the association, repel common enemies, and maintain a perpetual concord and harmony among us.”
Rousseau penned these words in 1754, 33 years before Gouverneur Morris oversaw the drafting of the identical sales pitch that constitutes the Preamble to the United States Constitution: “We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”
Rousseau concludes: “All offered their necks to the yoke in hopes of securing their liberty; for though they had sense enough to perceive the advantages of a political constitution, they had not experience enough to see beforehand the dangers of it; those among them, who were best qualified to foresee abuses, were precisely those who expected to benefit by them….” [Emphasis added]
Does the Deep State pose an existential threat to American democracy today? Move along, folks – nothing new to see here.
Jada Thacker, Ed. D, is the author of Dissecting American History: A Theme-Based Narrative. He teaches History and Government at a college in Texas. Contact: jadathacker@sbcglobal.net