wealth

Friday April 30, 2020

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday April 30, 2020

Coronavirus Proves Capitalism Has Always Been a Lie

April 2, 2020

As the coronavirus pandemic continues to cause mass death and upheaval around the world, there has been an unexpected side effect: it has unmasked capitalism. In the U.S., this unmasking can be seen in both the Federal Reserve’s actions as well as Congress’ coronavirus aid legislation, the CARES Act, both of which reveal critical truths about an economic system that has been sold to working people as one thing and as quite another to banks and corporations. To shed some much needed light on the intricacies of our financial situation during the latest crisis, “Scheer Intelligence” host Robert Scheer spoke with acclaimed economist and attorney Ellen Brown. 

There are plenty of parallels to be drawn between the last financial crisis and the coronavirus pandemic, with the clear exception being that now we’re not just dealing with a broken economy but with a deadly virus. Brown, who has written over a dozen books on economics and is the founder of the Public Banking Institute, explains how, unfortunately, the Covid-19 bailouts will once again betray Americans just as the 2008 stimulus did. 

November 14, 2008

“In 2008 the bailout was basically of the banks, or we had quantitative easing that went to the banks,” the author tells Scheer. “And then the idea was that the banks were supposed to lend that into the real economy, but of course, they didn’t do it. … But now we have even more credit facilities [and] the problem is, they’re all going to help the big corporations, and the hedge funds, and virtually every sort of shady business. Things the Federal Reserve couldn’t lend to before, [but] now they have new ways of doing it.”

The nefarious uses of the CARES Act have been blasted all over the press, and now news has emerged that the Federal Reserve is planning on handing big corporations a whopping half a trillion dollars with “no strings attached” and zero interest. As Scheer points out, however, this seemingly miraculous economic response at times of crisis, when money is suddenly conjured out of thin air, is nothing new. 

“The fact is, this is like what happens in wartime. You know, you had the Great Depression, [and when ] we went to war, suddenly [Franklin Delano] Roosevelt was able to really spend money,” says the “Scheer Intelligence” host, “And as a result, we got out of the Great Depression. In wartime, the government just prints money, finds it somewhere, and no questions asked. 

Coronavirus cartoons

“And that’s what happened now,” Scheer goes on. “Because of this pandemic, Congress just said, OK, we’re going to find–what, you said $4 trillion; I’m sure it’ll grow to $8 trillion. They don’t do that ever about, say, dealing with poverty or education, or any of these things; they always are very tight with the dollar. But now, because we have this warlike situation, they can suddenly find this money, and they can spend it in a totally unaccountable way.”

March 7, 2020

But just as the deadly pandemic is becoming yet another opportunity for Wall Street and corporations to swindle the public with the help of the government, it’s also finally made one thing very clear: Universal Basic Income is absolutely possible. 

“As you say, if they could find the money for all that,” Brown tells Scheer in response to his summary regarding how money has always been funneled to the top, “they could clearly find the money for the people. My preferred option [is what] they call ‘helicopter money.’ Money that’s just created by the Federal Reserve and flown–theoretically, the original term came from flying helicopters over the people and just dropping the money equally on everybody. And we could still do that, and that’s called a Universal Basic Income.”

Brown goes on to explain in detail why it’s not only affordable, but won’t cause the massive inflation that critics so often write about whenever the measure is suggested.

“It’s not going to be inflationary,” she explains, “and that’s because of the way money comes into existence. We don’t really have a money system; we have a credit system. All of our money is credit; it’s created as credit on the books of banks, and it’s extinguished when the loans are paid off.” 

Perhaps her most shocking calculation is that were the current stimulus money to be divvied up and sent directly to families, it would end up being $13,000 per person, not the measly $1,200 the government is sending out as a one-off. Where, you may ask, did all the rest of that money go? As Brown and Scheer continually remind us, it’s been sent to the companies that pull all the strings in our rigged system. (KCRW) 



 

Thursday April 2, 2020

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday April 2, 2020

If we want the economy to recover, we need to bail out tenants and property owners, too

Coronavirus cartoons

The federal government recently introduced a plan to encourage businesses to retain workers by subsidizing 75 per cent of their wages. By providing laid-off and self-isolating workers with an alternative to employment benefits it should help limit social, economic and financial disruption from the pandemic. Rather than let the economy tailspin, the hope is to engineer a successful recovery once the virus is contained. If business activity and consumer confidence vanish, getting the economy back off the ground will be hard.

We need to expand this plan to the real estate sector. For many newly laid-off people, neither expanded Employment Insurance nor the new Emergency Response Benefit will be enough to cover rent or mortgage payments. But homeowners in Vancouver and tenants in Toronto typically have much higher monthly obligations than those in Moncton and Trois-Rivières. Issuing the same federal cheque to everyone would not be fair. Commercial tenants are just as diverse: their ability to pay rent today depends on how hard the virus has hit their business and that varies from case to case and region to region.

On the positive side, banks rebuilt their capital over the past decade and most commercial landlords, because of strong recent growth, have resources to deal with temporary difficulties. But the scope of the current crisis is unprecedented: large numbers of homeowners could soon stop paying their mortgages, while many real estate owners could default on their commercial mortgages as both tenants stop paying rents. This would force banks to take large write-offs, quickly depleting their capital and potentially throwing the country into a financial crisis.

Such an outcome can be avoided by providing rapid and targeted mortgage and rent relief where it is most urgently needed. Because governments are already over-extended, banks and real estate owners should manage the programs I’m proposing, with government limited to providing funds, liquidity and loan guarantees. Minimizing the government’s role and putting the onus of implementation on banks and landlords would encourage efficiency and speed. (Continued: Financial Post) If we want the economy to recover, we need to bail out tenants and property owners, too

The federal government recently introduced a plan to encourage businesses to retain workers by subsidizing 75 per cent of their wages. By providing laid-off and self-isolating workers with an alternative to employment benefits it should help limit social, economic and financial disruption from the pandemic. Rather than let the economy tailspin, the hope is to engineer a successful recovery once the virus is contained. If business activity and consumer confidence vanish, getting the economy back off the ground will be hard.

We need to expand this plan to the real estate sector. For many newly laid-off people, neither expanded Employment Insurance nor the new Emergency Response Benefit will be enough to cover rent or mortgage payments. But homeowners in Vancouver and tenants in Toronto typically have much higher monthly obligations than those in Moncton and Trois-Rivières. Issuing the same federal cheque to everyone would not be fair. Commercial tenants are just as diverse: their ability to pay rent today depends on how hard the virus has hit their business and that varies from case to case and region to region.

On the positive side, banks rebuilt their capital over the past decade and most commercial landlords, because of strong recent growth, have resources to deal with temporary difficulties. But the scope of the current crisis is unprecedented: large numbers of homeowners could soon stop paying their mortgages, while many real estate owners could default on their commercial mortgages as both tenants stop paying rents. This would force banks to take large write-offs, quickly depleting their capital and potentially throwing the country into a financial crisis.

Such an outcome can be avoided by providing rapid and targeted mortgage and rent relief where it is most urgently needed. Because governments are already over-extended, banks and real estate owners should manage the programs I’m proposing, with government limited to providing funds, liquidity and loan guarantees. Minimizing the government’s role and putting the onus of implementation on banks and landlords would encourage efficiency and speed. (Continued: Financial Post) 

 

Friday February 21, 2020

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday February 21, 2020

Despite His Billions, Bloomberg Busts

You can buy ads and saturate the airwaves with them. You can buy allies, especially with the right budget.

February 7, 2020

But you can’t buy a debate performance, and that’s why Mike Bloomberg’s on Wednesday night mattered so much. This was the man talking, not the money.

And the man needed rescue — from his bloodthirsty rivals and even more so from himself.

Making his first appearance alongside other contenders for the Democratic presidential nomination, Bloomberg knew that he would be under furious attack and had clearly resolved not to show any negative emotion. But that meant that he often showed no emotion at all. Or he looked vaguely bemused, and that didn’t communicate the coolness that he intended. It signaled an aloofness that he very much needed to avoid.

He made a groaner of a joke about his wealth, saying that he could hardly use a plebeian instrument like TurboTax to ready his tax returns for public consumption. He made light of past harassment-related complaints from female employees: “None of them accuse me of doing anything other than maybe they didn’t like a joke I told.”

February 11, 2020

He repeatedly — and laughably — suggested that he wouldn’t tear up nondisclosure agreements with women who have sued him or his company because they wanted the silence as much as he did. Elizabeth Warren hammered and hammered him on this point, but he wouldn’t budge, and that left the impression that he couldn’t budge. The truth would be too ugly.

My first sketch of Michael Bloomberg. Kinda’ resembles actor Christopher Plummer in this depiction. More work needed? Or, why bother? Maybe he’s washed up?*

Ugly: That’s the word for this ninth debate of the Democratic primary season. It had the fewest candidates — six — but the most nastiness, because those candidates clearly felt an urgency to diminish their competitors and elevate themselves before it was too late. A meager haul of votes in the Nevada caucuses this coming Saturday could effectively undo one or more of them; a poor showing on Super Tuesday less than two weeks from now would definitely be the end of the road.

It’s no wonder they wanted a bite of him. It was the first time since Bloomberg announced his run for the presidency that he was within reach. For three high-spending, high-flying months, he campaigned essentially as a phantasm, ubiquitous in television commercials but averse to interviews, a supposed paragon of electability who had yet to put himself before voters, more idea than actuality, able to be seen but not touched.

But on Wednesday night, that changed abruptly. The apparition became flesh. And it was bruised from the get-go and bloodied soon after. (Continued…NYT)

 * It was my second time drawing him, actually. The first time I sketched Michael Bloomberg was while watching him on TV as he spoke to delegates at the 2016 Democratic Party convention.

Wednesday September 24, 2019

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Wednesday September 24, 2019

‘How dare you’: Teen environmental activist Greta Thunberg scolds world leaders at UN climate talks

Scolded for doing little, leader after leader promised the United Nations on Monday to do more to prevent a warming world from reaching even more dangerous levels.

December 1, 2015

As they made their pledges at the Climate Action Summit, though, they and others conceded it was not enough. And even before they spoke, teenage climate activist Greta Thunberg shamed them over and over for their inaction: “How dare you?”

Secretary-General Antonio Guterres concluded the summit by listing 77 countries that committed to carbon neutrality by 2050, 70 nations pledging to do more to fight climate change, with 100 business leaders promising to join the green economy and one-third of the global banking sector signing up to green goals.

“Action by action, the tide is turning,” he said. “But we have a long way to go.”

June 2, 2017

Businesses and charities also got in on the act, at times even going bigger than major nations. Microsoft founder Bill Gates announced Monday that his foundation, along with The World Bank and some European governments, would provide $790 million in financial help to 300 million of the world’s small farmers adapt to climate change. The Gates foundation pledged $310 million of that.

“The world can still prevent the absolute worst effects of climate change by reducing greenhouse gas emissions and developing new technologies and sources of energy,” Gates said. “But the effects of rising temperatures are already underway.”

As the day went on Monday and the promises kept coming, the United States seemed out in the cold.

Before world leaders made their promises in three-minute speeches, the 16-year-old Thunberg gave an emotional appeal in which she scolded the leaders with her repeated phrase, “How dare you.”

“This is all wrong. I shouldn’t be up here,” said Thunberg, who began a lone protest outside the Swedish parliament more than a year ago that culminated in Friday’s global climate strikes.

November 28, 2015

“I should be back in school on the other side of the ocean. Yet you have come to us young people for hope. How dare you. You have stolen my dreams and my childhood with your empty words.

Thunberg told the UN that even the strictest emission cuts being talked about only gives the world a 50 per cent chance of limiting future warming to another 0.4 C from now, which is a global goal. Those odds, she said, are not good enough.

“We will not let you get away with this,” Thunberg said. “Right now is where we draw the line.”

As this all played out, scientists announced that Arctic sea ice reached its annual summer low and this year the ice shrank so much it tied for the second lowest mark in 40 years of monitoring. (Hamilton Spectator) 

 

Friday November 17, 2017

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday November 17, 2017

Da Vinci painting sells for $450 million, shattering auction records

After 19 minutes of dueling, with four bidders on the telephone and one in the room, Leonardo da Vinci’s “Salvator Mundi” sold Wednesday night for $450.3 million U.S., or $575 million Canadian, with fees, shattering the high for any work of art sold at auction. It far surpassed Picasso’s “Women of Algiers,” which fetched $179.4 million (U.S.) at Christie’s in May 2015.

August 25, 2012

The buyer was not immediately disclosed.

There were gasps throughout the sale, as the bids climbed by 10s up to $225 million, then by 5s up to $260 million, then by 2s. As the bidding slowed, and a buyer pondered the next multimillion-dollar increment, Jussi Pylkkanen, the auctioneer, said, “It’s a historic moment: We’ll wait.”

There were two big jumps toward the end to shake off the competition by Alex Rotter, Christie’s chairman of postwar and contemporary art for the Americas, who represented a buyer on the phone.

The price is all the more remarkable at a time when the old masters market is contracting, because of limited supply and collectors’ penchant for contemporary art.

And to critics, the astronomical sale attests to something else — the degree to which salesmanship has come to drive and dominate the conversation about art and its value. Some art experts pointed to the painting’s damaged condition and its questionable authenticity. (Source: Toronto Star) 

 

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