Archive for the ‘editorial’ Category





Here’s a nice illusion of the main process of policy in the US today called “revolving door” in this case showing how food and agricultural policy is controlled by the giant monopoly Monsanto.

This has been operating for decades but is today the norm today with very few exceptions. A similar list can be drawn for education, environmental, health, communications, EVERYTHING.


To my libertarian friends: Are you enjoying this “self-regulatory” system? After all isn’t this what Ayn rand advocated: government by and for the business elites?

To my liberal friends: Yes we must have effective regulation for a market-system to work. But tell me exactly HOW we would get that when the government (Dems or Reps) are completely in the pocket of multinational?


The radicals are (as usual) correct!

Here’s some unpopular truths and keep in mind that the article linked tells of 2 ladies who’ve won local Mayoral elections despite being hardline supporters of this armed illegal insurrection and whose husbands are under arrest for unlawful participation in them.  Everybody keeps spreading stories on how undemocratic the Venezuelan government is behaving… hmmm.  I wish we had such a well-functioning democracy in the US! 

Opposition leader and former lawmaker Maria Corina Machado, left and mayoral candidate Patricia Gutierrez greet supporters at a campaign rally in San Cristobal, Venezuela, May 22, 2014.

The democratically elected government of Venezuela has lost some of its massive support in recent years after accomplishing quasi-miraculous progress on many fronts and most notably reduction of poverty and advancing democracy in South America in the past decade.

Recently, economic difficulties have eroded this support to some extent some legitimate opposition leaders have made some respectable gains in national and local elections. In the past few months there has been an uprising against the elected government  that is portrayed by the majority of the media as a popular revolt being crushed by the government but this is the usual corporate-imperialist media BS.

See several previous posts with lots of details (just click the “Venezuela” tag on the left) but here’s the skinny: While there are many bone-fide middle class Venezuelans who are caught up in the middle of this, this is a CIA backed “soft-coup” run by billionaire oligarchs who want to take Venezuela back to the old days of mass poverty and oil riches for the 1% in Miami. The government has shown remarkable restraint in dealing with these groups of violent thugs and has kept the democratic institutions open. All the BS stories on Facebook and twitter about internet closures and lack of due-process are propaganda. In fact, as has been the case since 2002, the government is doing everything it can to restrain the masses of poor people it had liberated and protect the upper classes from their righteous rage.

Imagine a people subjugated brutally since the Spanish conquest finally having democracy and being told that they cannot re-take what’s rightfully theirs but must remain in their slums and patiently wait as economic opportunities are being slowly created for their children. The legal loyal opposition has been having increased influence and are now politically damaged by these generally upper-middle-class insurgents supported by foreign corporate interests. The only reason the insurgency has not been violently crushed is that the government is restraining the majority poor Chavista as best it can.

I know I’ll piss some people of with this and the Venezuelan government deserves to be criticised. But 99% of the coverage by mainstream media and social-network hype is BS and people are being caught up in it and unable to have an intelligent discussion. Happily there are a handful of people on both sides who are helping me understand what’s going on and I’m passing it along.


1966695_780730285289579_1013551254_nWhere does one even start to answer the question everybody is asking: What is going on in Venezuela and Ukraine?!? So in the spirit of punk (and French postmodernism), I’ll just stick a bunch of things together (bricolage). I provide a number of good sources at the bottom for you to get a fuller picture.

So is it a bunch of democracy-loving students engaged in non-violent resistance being violently oppressed by totalitarian governments? No it is not. But it is hard to see the big picture without getting into the long history of Venezuela and Ukraine and many other places. Hell, you need to look at the past 500+ years to really get the picture–oh yeah, that is why education is important but a good real-world education is almost impossible to get and requires many years.

I’ve been having lots of arguments with relatively rich and some very rich ex-students and their friends from Venezuela and have been trying very hard to be as civil as I can because I’m honestly trying to be open and understanding. Knowing that the Venezuela has eradicated hunger while here in the US 20% of kids are hungry today, it breaks my heart and makes me both sad and angry to hear a Venezuelan blogger complain about not being able to bake a cake due to milk shortages!? The economic problems in Venezuela are also not what they seem but on that later. I guess I’ll get some hate for this but the truth is ugly and complicated.

Disclaimer: let’s put Ukraine aside for a moment–I know less about it’s internal politics and will make a special post about it soon. Watch this for now.

In attempting to be “fair and balanced” (pun intended), I tried to watch the mainstream media and anti-government Venezuelan rhetoric too to see if perhaps I’m the one being misled… no, it was BS propaganda to anybody aware of the long and medium term facts of economics and politics–sorry.

I watched Jehane Noujaim’s documentary The Square (2013) about the revolutionary struggles in Egypt in order to catch the current romantic feel of heroic youth uprisings that seem to motivate all the Web 2.0 gushing about Venezuela and Ukraine. Well the Egyptians really did have a genuine uprising against a US supported dictator by poor and rich, secular, and religious youth and they lost their heroic battle, were successfully played by the military, and crushed with the continued support of the US. In the film, an exiled father of one of the revolutionary tells him: “The rich don’t need freedom. The rich are already free.” Now stop for a second and ask yourself: how does this fit into the “struggle for freedom” in the streets of Caracas these past days? It doesn’t!

Why? Because it is entirely orchestrated and run by rich Venezuelans. The majority poor aren’t involved in this at all. A significant minority in Venezuela are critical of their democratically elected government and have been exercising their right of expression and political participation but have not been able to gain power by legal means though Henrique Capriles came close in the previous presidential elections. His moderate minority is also overwhelmingly rich and upper middle-class urban people and he deserves credit for NOT supporting the radical right-wing takeover of the opposition by, most notably Leopoldo Lopez, a billionaire from an old power-family who has been taking violent actions against the Chavez government since the previous CIA backed coup against democracy in 2002. He is and continues to be a rich oligarch thug who deeply resents not being able to rule over his domain like his ancestors before him. Despite his wealth, US support, global financial support, and a sophisticated propaganda machine, he only won the hearts of rich people and it looks like all he accomplished is to break up the legitimate opposition. The violent clashes were rather small and mostly located in their rich neighborhoods and private schools and much of the violence came from Lopez’s followers themselves. Oh yeah, and more innocent civilians are murdered by the government of Colombia (a close ally of the US and Lopez and friends) every week than have died in Venezuela’s riots–double standards?

YES Venezuela has some serious economic problems. These are complex issues I’ll try to tackle in a future post but let’s say that at the very least, we should know that over the past decade, Venezuela has accomplished a tremendous feat of poverty-reduction never seen anywhere in recent times. The lives of a vast majority of the poor population have improved dramatically while everywhere else on Earth over the same time, the opposite has happened–even in China. Furthermore, they accomplished this despite aggressively hostile global economic players who have been funding coups and radical groups and even engaging in direct economic sabotage that are, at least in part, responsible for Venezuela’s economic woes. So whatever legitimate problems they have with street violence, food-prices, and inflation, the Bolivarian democratic regimes in South America have been the first good thing to happen to the vast majority of the people there since the European conquest 500+ years ago and would not have been possible without the leadership of the Venezuelan people and Chavismo–something for Venezuelans to be very proud about!

The Postmodern Twist:

People in supposedly free countries not knowing what is being done in their name is not new: Manufacturing Consent: The Political Economy of the Mass Media (1988), by Edward S. Herman and Noam Chomsky should be required reading (here’s a very short intro about their Propaganda Model). BUT I think it has gotten more dominant especially in the current media coverage of Venezuela and Ukraine. Today, there even is a twist within a twist in that people are posting their outrage about how “the media” is not “covering” the situation. They then post blatant propaganda in support of a what is in actuality a well-engineered propaganda campaign by oligarchic elites to undermine democracy (wow! despite my training in postmodern philosophy, my head spins).

But it gets crazier! The power-elites (aka the 1%) and the military-financial-complex (more on this soon–check this out) are using the well-meaning non-violent work of liberals such as Gene Sharp to execute their coups. No need to send death squads (trained at School of the Americas in Georgia), or militarily support nasty dictators and juntas (like in Egypt among numerous examples). Today they can use well-meaning naive and propagandized students to spark the process of post-colonial oppression: it’s colonizing version 3.0!

Question: ok ok we get it, but what IS going on in the Venezuela?

Answer: An attempted “Soft Coup”:

I’ve adapted this from TeleSUR which is funded by the left governments of America including Venezuela and even Cuba! Not disinterested and independent but a good summary of work by the (IMHO well-meaning) philosopher and political scientist Gene Sharp. Also, consider my previous bla bla, history, provided links (see below), history (yes; again), and judge for yourself if this is not a damn good model for the current goings on:

How to overthrow a government through non-violent methods
(in this context, non-violent implies not organizing guerrillas or invading from abroad):

  1. “Softening”

    • creating climate of opinion focusing on deficiencies

    • disseminate discontent

    • promote shortages, criminality, internal fractures, sabotage

  2. “Delegitimization”

    • ethical and political fracture

    • media campaigns accusing government of being totalitarian (and/or communist) and contrasting opposition as fighting for freedom and human rights

  3. “Street heating”

    • promote conflict and street mobilization

    • promote struggle for globalized political and social demands

    • create state reaction and consequently public discontent in order to radicalize the confrontation

  4. Reaction:

    • Armed actions to justify repressive measures and create climate of ungovernability

    • Smear campaign among state forces to demoralize security forces

  5. “Institutional Fracture”

    • Increased street actions

    • Occupation of institutions

    • Force resignation of government (especially figure -head)

In case of failure to overthrow government, rinse and repeat:

  • escalate stage 3, 4, and 5

  • seek international intervention: sanctions and/or military

  • develop prolonged civil war

Tell me this doesn’t sound awfully familiar!?!

Collection of links:

Taxing the 1%: Why the top tax rate could be over 80% | vox.

Taxing the 1%: Why the top tax rate could be over 80%

Thomas Piketty, Emmanuel Saez, Stefanie Stantcheva, 8 December 2011

The top 1% of US earners now command a far higher share of the country’s income than they did 40 years ago. This column looks at 18 OECD countries and disputes the claim that low taxes on the rich raise productivity and economic growth. It says the optimal top tax rate could be over 80% and no one but the mega rich would lose out.

In the United States, the share of total pre-tax income accruing to the top 1% has more than doubled from less than 10% in the 1970s to over 20% today (CBO 2011 and Piketty and Saez 2003). A similar pattern is true of other English-speaking countries. Contrary to the widely held view, however, globalisation and new technologies are not to blame. Other OECD countries such as those in continental Europe or Japan have seen far less concentration of income among the mega rich (World Top Incomes Database 2011).

At the same time, top income tax rates on upper income earners have declined significantly since the 1970s in many OECD countries, again particularly in English-speaking ones. For example, top marginal income tax rates in the United States or the United Kingdom were above 70% in the 1970s before the Reagan and Thatcher revolutions drastically cut them by 40 percentage points within a decade.

At a time when most OECD countries face large deficits and debt burdens, a crucial public policy question is whether governments should tax high earners more. The potential tax revenue at stake is now very large. For example, doubling the average US individual income tax rate on the top 1% income earners from the current 22.5% level to 45% would increase tax revenue by 2.7% of GDP per year,1 as much as letting all of the Bush tax cuts expire. But, of course, this simple calculation is static and such a large increase in taxes may well affect the economic behaviour of the rich and the income they report pre-tax, the broader economy, and ultimately the tax revenue generated. In recent research (Piketty et al 2011), we analyse this issue both conceptually and empirically using international evidence on top incomes and top tax rates since the 1970s.

Figure 1 shows that there is indeed a strong correlation between the reductions in top tax rates and the increases in top 1% pre-tax income shares from 1975–79 to 2004–08 across 18 OECD countries for which top income share information is available. For example, the United States experienced a 35 percentage point reduction in its top income tax rate and a very large ten percentage point increase in its top 1% pre-tax income share. By contrast, France or Germany saw very little change in their top tax rates and their top 1% income shares during the same period. Hence, the evolution of top tax rates is a good predictor of changes in pre-tax income concentration. There are three scenarios to explain the strong response of top pre-tax incomes to top tax rates. They have very different policy implications and can be tested in the data.

First, higher top tax rates may discourage work effort and business creation among the most talented – the so-called supply-side effect. In this scenario, lower top tax rates would lead to more economic activity by the rich and hence more economic growth. If all the correlation of top income shares and top tax rates documented on Figure 1 were due to such supply-side effects, the revenue-maximising top tax rate would be 57%. This would still imply that the United States still has some leeway to increase taxes on the rich, but that the upper limit has already been reached in many European countries.

Second, higher top tax rates can increase tax avoidance. In that scenario, increasing top rates in a tax system riddled with loopholes and tax avoidance opportunities is not productive either. However, a better policy would be to first close loopholes so as to eliminate most tax avoidance opportunities and only then increase top tax rates. With sufficient political will and international cooperation to enforce taxes, it is possible to eliminate most tax avoidance opportunities, which are well known and documented. With a broad tax base offering no significant avoidance opportunities, only real supply-side responses would limit how high top tax rate can be set before becoming counter-productive.

Third, while standard economic models assume that pay reflects productivity, there are strong reasons to be sceptical, especially at the top of the income distribution where the actual economic contribution of managers working in complex organisations is particularly difficult to measure. In this scenario, top earners might be able to partly set their own pay by bargaining harder or influencing compensation committees. Naturally, the incentives for such ‘rent-seeking’ are much stronger when top tax rates are low. In this scenario, cuts in top tax rates can still increase top income shares – consistent with the observed trend in Figure 1 – but the increases in top 1% incomes now come at the expense of the remaining 99%. In other words, top rate cuts stimulate rent-seeking at the top but not overall economic growth – the key difference with the first, supply-side, scenario.

To tell these various scenarios apart, we need to analyse to what extent top tax rate cuts lead to higher economic growth. Figure 2 shows that there is no correlation between cuts in top tax rates and average annual real GDP-per-capita growth since the 1970s. For example, countries that made large cuts in top tax rates such as the United Kingdom or the United States have not grown significantly faster than countries that did not, such as Germany or Denmark. Hence, a substantial fraction of the response of pre-tax top incomes to top tax rates documented in Figure 1 may be due to increased rent-seeking at the top rather than increased productive effort.

Naturally, cross-country comparisons are bound to be fragile, and the exact results vary with the specification, years, and countries. But by and large, the bottom line is that rich countries have all grown at roughly the same rate over the past 30 years – in spite of huge variations in tax policies. Using our model and mid-range parameter values where the response of top earners to top tax rate cuts is due in part to increased rent-seeking behaviour and in part to increased productive work, we find that the top tax rate could potentially be set as high as 83% – as opposed to 57% in the pure supply-side model.

Up until the 1970s, policymakers and public opinion probably considered – rightly or wrongly – that at the very top of the income ladder, pay increases reflected mostly greed or other socially wasteful activities rather than productive work effort. This is why they were able to set marginal tax rates as high as 80% in the US and the UK. The Reagan/Thatcher revolution has succeeded in making such top tax rate levels unthinkable since then. But after decades of increasing income concentration that has brought about mediocre growth since the 1970s and a Great Recession triggered by financial sector excesses, a rethinking of the Reagan and Thatcher revolutions is perhaps underway. The United Kingdom has increased its top income tax rate from 40% to 50% in 2010 in part to curb top pay excesses. In the United States, the Occupy Wall Street movement and its famous “We are the 99%” slogan also reflects the view that the top 1% may have gained at the expense of the 99%.

In the end, the future of top tax rates depends on the public’s beliefs of whether top pay fairly reflects productivity or whether top pay, rather unfairly, arises from rent-seeking. With higher income concentration, top earners have more economic resources to influence social beliefs (through think tanks and media) and policies (through lobbying), thereby creating some reverse causality between income inequality, perceptions, and policies. We hope economists can shed light on these beliefs with compelling theoretical and empirical analysis.

Figure 1. Changes in top 1% pre-tax income shares and top marginal tax rates since the 1970s

Note: The Figure depicts the change in top 1% pre-tax income shares against the change in top marginal income tax rates from 1975-9 to 2004-8 for 18 OECD countries (top tax rates include both central and local individual income tax rates, exact years vary slightly by countries depending on data availability in the World Top Income Database). Source: Pikettyet al (2011), Figure 4A.

Figure 2. GDP-per-capita growth rates and top marginal tax rates since the 1970s

Note: The Figure depicts the average real GDP-per-capita annual growth rate from 1975-9 to 2004-8 against the change in top marginal tax rates from 1975-9 to 2004-(exact years are the same as Figure 1 and vary slightly by countries). The correlation is virtually zero and insignificant suggesting that cuts in top tax rates do not lead to higher economic growth.Source: Piketty et al (2011), Figure 4B.


Congressional Budget Office (2011), “Trends in the Distribution of Household Income Between 1979 and 2007”, US government Printing Press: Washington DC. Available online at

Piketty, Thomas and Emmanuel Saez (2003), “Income Inequality in the United States, 1913-1998”,Quarterly Journal of Economics, 118(1):1-39, series updated to 2008 in July 2010, online at

Piketty, Thomas, Emmanuel Saez, and Stefanie Stantcheva (2011), “Optimal Taxation of Top Labor Incomes: A Tale of Three Elasticities“, CEPR Discussion Paper 8675, December.

The World Top Incomes Database (F Alvaredo, T Atkinson, T Piketty, and E Saez), online at

1 This calculation assumes that the top 1% income share is 20%. The top 1% income share peaked at 23.5% in 2007, and then fell to 21% in 2008 and 18% in 2009, at the trough of the recession. In 2010 and 2011, the top 1% income share is very likely to increase again to 20%. Total market income reported for tax purposes is about 60% of GDP (on average from 1999 to 2008). Hence, increasing the top 1% average tax rate by 22.5 points raises .6*.225*.2=2.7% of GDP, or $405 billion given the current 2011 GDP of $15 trillion.



Dalai Lama describes himself as “half-Marxist, half-Buddhist”

Of course the Dalai Lama’s a Marxist

The leader’s statement shocked some in the west, but reminds us of Buddhism’s commitment to social as well as individual good, Monday 20 June 2011 11.30 EDT
The Dalai Lama

The Dalai Lama has a refreshing tendency to confound western caricatures. As a cuddly old monk, he could comfort fans by fuzzily connecting us to an imagined Shangri-La that contrasts favourably with our own material world. Only he won’t play the game, regularly making ethical, political, scientific and (ir)religious statements that rudely pop the projections laid on to him.

He was at it again the other day, telling Chinese students that he considers himself a Marxist. This wasn’t just playing to the crowd – although it was reported with surprise (at least in the US), the ideological alignment is longstanding. In 1993, he said: “The economic system of Marxism is founded on moral principles, while capitalism is concerned only with gain and profitability. Marxism is concerned with the distribution of wealth on an equal basis … as well as the fate of those who are underprivileged and in need, and [it] cares about the victims of minority-imposed exploitation. For those reasons, the system appeals to me, and it seems fair.”

There are a number of caveats (he’s not a Leninist, believes compassion rather than class struggle is key, and doesn’t consider communist regimes such as the USSR, China or Vietnam to have been true exponents), but the dissonance between image and reality remains – the Dalai Lama is not the comforting Oriental pet that consumer society might like.

Neither does his tradition match the capitalist fantasies attached to it. Perhaps because Buddhism came to the west on a wave of post-war hippy soul-searching, and was then co-opted as friendly religion of choice by new ageism and the self-help movement, its radical economic and social messages have been lost under an avalanche of laughing fat-man statues, healing crystals and copies of The Secret.

The very idea of self-help in Buddhism is an oxymoron – relief of suffering can only come from the realisation that pleasing ourselves doesn’t bring happiness – instead we must try to work skilfully and compassionately with others, as part of interwoven systems of connectivity that bind us together. A “western Buddhism” that prioritises solipsistic focus on the individual is so great a misconception as to be unworthy of the name – or at the least the Buddhism part – as anyone who pays it more than passing attention knows. It’s also largely a media invention – many western Buddhists are serious, deeply committed practitioners. That commitment means choosing to follow a path that leads against the stream of materialism and selfishness. Of course, we don’t always manage it, but that’s why it’s called a path of practice.

Buddhism goes way beyond the confines of the personal – realising the truth of interdependence implies taking up the challenge of engaging with others in the wider world. This isn’t missionary zeal – proselytising is hardly the Buddhist way – but it does mean social action that embodies dharmic principles, and western sanghas are increasingly prioritising community involvement. As they do so, Buddhism may start to look less like some nice bit of calm and relaxation and more like a radical, uncompromising critique of the status quo.

This critique has already begun to influence the UK mainstream. It’s 45 years since EF Schumacher published his Buddhist Economics essay in Small is Beautiful, which the Times Literary Supplement listed as one of the 100 most influential books since the second world war. Though the male-centric, mechanistic world it describes now seems dated, Schumacher’s outline of a world driven mad by consumption (and his Buddhist-inspired remedy of sufficiency and sustainability) has informed everything from the climate change debate to the happiness agenda – particularly through the influentialNew Economics Foundation (NEF) thinktank, which grew out of Schumacher’s vision.

The well-being indices enthusiastically taken up by David Cameron have grown in part from NEF’s links with the kingdom of Bhutan and its policy of favouring gross national happiness above gross domestic product. Is the prime minister aware of the Buddhist foundation to his plans for the nation’s mood?

Of course, we’re a long way from a government that looks even remotely dharmic. From a Buddhist perspective, only a revolution in our collective mind can counter the momentum that keeps us grasping for happiness in all the wrong places. And that would involve more than measuring whether someone with a job and a family in sunny Cornwall feels more upbeat than a lonely, unemployed Londoner on a rainy day. It would require systemic transformation on both an intimate and a huge scale, bringing the path of personal practice together with much broader societal shifts. Could this be what the Dalai Lama is thinking of when he describes himself as “half-Marxist, half-Buddhist”?