Author Archives: Lila

Money Dominates India’s Ruling Class

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From Sainath at Counterpunch, an analysis of MPs (Members of Parliament) in the Lok Sabha (the lower house, or House of Commons, as opposed to the Rajya Sabha or House of Lords) in India:

“NEW is a coalition of over 1200 civil society groups working across the country. Their “Analysis of MPs of the 15th Lok Sabha (2009)” makes great reading and is the product of fine research and much hard work.

There were 3,437 candidates in the polls with assets of less than Rs. 1 million, says the report. Of these, just 15 (0.44 per cent) made it past the post. But your chances soar with your assets. Of 1,785 candidates in the Rs. 1 million to Rs. 5 million group, 116 (6 per cent) won. This win-ratio goes up to 19 per cent of candidates for the Rs.5 million to Rs.50 million segment. And of 322 candidates in the Rs.50 million plus or platinum tier, 106 (33 per cent) romped home.

The higher you climb the ladder of lucre, the better your chances. That’s obvious. But what’s striking is how bleak things are for non-millionaires. Even a modest improvement in your wealth helps. Say, you move from the below Rs. 1 million group to the Rs. 1-5 million group — your chances immediately improve at a higher rate than your wealth. (Of course that works only if you are already close to the Rs. 1 million mark.) So it’s not just that wealth has some impact on election outcomes — it influences them heavily and disproportionately as you go up the scale.

All of a piece with a society that only last year had 53 dollar billionaires (pre-meltdown), one that still has 836 million human beings who “get by” on less than Rs. 20 a day and which ranks 66th amongst 88 nations on the Global Hunger Index (just one notch above Zimbabwe). India has plummeted to rank 132 in the United Nations Human Development Index (one slot below Bhutan) as our billionaire count has risen. That wallows below Bolivia, Botswana, the Republic of the Congo and the Occupied Territories of Palestine in the HDI rankings. And never mind being worth billions – 60 per cent of adult rural Indians simply do not have bank accounts….”

Bastiat On Roman Rule

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Many thanks to Kevin Duffy for pointing me in the direction of this essay by Bastiat. It’s a marvel, filled with ideas, each of which could be developed into a full book in its own right.

“What is to be said of Roman morality? And I am not speaking here of the relations of father and son, of husband and wife, of patron and client, of master and servant, of man and God—relations that slavery, by itself alone, could not fail to transform into a whole network of depravity; I wish to dwell only on what is called the admirable side of the Republic, i.e., patriotism. What was this patriotism? Hatred of foreigners, the destruction of all civilization, the stifling of all progress, the scourging of the world with fire and sword, the chaining of women, children, and old men to triumphal chariots—this was glory, this was virtue….It is from Rome undoubtedly that this adage comes to us, true in regard to theft, false in regard to labor: one nation’s loss is another nation’s gain—an adage that still governs the world.

To acquire an idea of Roman morality, imagine in the heart of Paris an organization of men who hate to work, determined to satisfy their wants by deceit and force, and consequently at war with society. Doubtless a certain moral code and even some solid virtues will soon manifest themselves in such an organization. Courage, perseverance, self-control, prudence, discipline, constancy in misfortune, deep secrecy, punctilio, devotion to the community—such undoubtedly will be the virtues that necessity and prevailing opinion would develop among these brigands; such were those of the buccaneers; such were those of the Romans. It may be said that, in regard to the latter, the grandeur of their enterprise and the immensity of their success has thrown so glorious a veil over their crimes as to transform them into virtues. And this is precisely why that school is so pernicious. It is not abject vice, it is vice crowned with splendor, that seduces men’s souls.”

Hans Hoppe on Citizens as Public Property

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Lew Rockwell cites some arresting insights from Hans Hoppe on the Constitution and on the ultimate nature of democracy and the total state:

“History bears this out. Hoppe dates the onset of modern democracy to World War I and following, and he has scandalized many by calling the U.S., the Soviet Union, and Nazi Germany all democracies, but he means this in his special sense: the people neither own themselves nor are owned by anyone. The citizens are public property and are said to all participate in their own governance understood as an elected executive state. This was a modern form of government that displaced the old form – and it goes a long way towards explaining the advent of total war and the total state.”

The End of Locational Privacy…

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Adam Cohen has a great piece at the New York Times on the end of locational privacy:

“Verizon online knows when I logged on, and New York Sports Club knows when I swiped my membership card. The M.T.A. could trace (through the MetroCard I bought with a credit card) when and where I took the subway, and The Times knows when I used my ID to enter the building. AT&T could follow me along the way through my iPhone.

There may also be videotape of my travels, given the ubiquity of surveillance cameras in New York City. There are thousands of cameras on buildings and lampposts around Manhattan, according to the New York Civil Liberties Union, many near my home and office. Several may have been in a position to film dinner on Elisabeth and Dan’s roof.

A little-appreciated downside of the technology revolution is that, mainly without thinking about it, we have given up “locational privacy.” Even in low-tech days, our movements were not entirely private. The desk attendant at my gym might have recalled seeing me, or my colleagues might have remembered when I arrived. Now the information is collected automatically and often stored indefinitely.

Privacy advocates are rightly concerned. Corporations and the government can keep track of what political meetings people attend, what bars and clubs they go to, whose homes they visit. It is the fact that people’s locations are being recorded “pervasively, silently, and cheaply that we’re worried about,” the Electronic Frontier Foundation said in a recent report.

People’s cellphones and E-Z Passes are increasingly being used against them in court. If your phone is on, even if you are not on a call, you may be able to be found (and perhaps picked up) at any hour of the day or night. As disturbing as it is to have your private data breached, it is worse to think that your physical location might fall into the hands of people who mean you harm….”

My Comment

And of course, that’s what I’m liking about my stay down south. The feeling of having someone always looking over your shoulders diminishes a lot once you leave the country.

To add to Cohen’s litany of surveillance, take Google accounts. There’s an option that lets Google keep track of your web browsing, of every site you opened, and all it takes is a check against the box. Say someone hacks your Google account. Or a Google employee decides to do it as a prank or from malice. They could check that box and keep tabs on what it was you were reading and investigating.

That’s only one possibility. Obviously, someone could also hack your account and browse through it to create a fake history of what you were investigating or browsing. You could without your knowledge have been reading “jihadi” sites….or racist sites…or hate sites of some other type…or child pornography…or anything else your enemies might want to recreate you as.

People who think Google and wiki are going to bring down the establishment have got to be kidding or very naive. Google and wiki can, have, and will work with the establishment when it suits them.

Commercial Real Estate Worsening..

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Commercial Mortgage-Backed Securities (financial instruments backed by debt derived from commercial real estate mortgages) are in growing trouble, says the Wall Street Journal:

“The CMBS sector is suffering two kinds of pain, which, according to credit rater Realpoint LLC, sent its delinquency rate to 3.14% in July, more than six times the level a year earlier. One is simply the result of bad underwriting. In the era of looser credit, Wall Street’s CMBS machine lent owners money on the assumption that occupancy and rents of their office buildings, hotels, stores or other commercial property would keep rising. In fact, the opposite has happened. The result is that a growing number of properties aren’t generating enough cash to make principal and interest payments.

The other kind of hurt is coming from the inability of property owners to refinance loans bundled into CMBS when these loans mature. By the end of 2012, some $153 billion in loans that make up CMBS are coming due, and close to $100 billion of that will face difficulty getting refinanced, according to Deutsche Bank. Even though the cash flows of these properties are enough to pay interest and principal on the debt, their values have fallen so far that borrowers won’t be able to extend existing mortgages or replace them with new debt. That means losses not only to the property owners but also to those who bought CMBS — including hedge funds, pension funds, mutual funds and other financial institutions — thus exacerbating the economic downturn...”

My Comment

So there you have the reality under the green shoots hype. The economy might be showing good signs – why wouldn’t it, the amount of money that’s been thrown into it – but in the long-run, the refusal to let the underlying problem correct itself only drags out the crisis and makes it worse. And that’s just CMBS, one part of the entire commercial real estate market. The whole market is $6.7 trillion.

The failing loans make up about 1/60th of the entire market, but since they’re widely dispersed in individual and institutional portfolios, their impact will be far greater and more cumulative than their numbers would suggest. That was what happened with residential ARMs.

We explain the whole crisis in “Mobs, Messiahs, and Markets” (check out the new paper-back edition that came out from John Wiley, August 24, 2009) – look at the financial sections – “Flattening the Globe” (that explains the un-Friedmanesque facts behind globalization) and the section called “Bubble Kings.”

It’s a quick and easy but thoroughly researched run-down of what happened in the financial markets. You’ll be able to figure it out, even if you never took a course in economics.

In fact, it might be harder for you if you did take college economics, where the underlying premise is that static models can do better than real world analysis in predicting what’s going to happen.

How many of these academic experts, including Ben Bernanke, anticipated what might happen and explained clearly and accurately why it would happen? None, it looks like.

There’s a lot of revisionism going on now..People are rewriting what they said two years ago or five, or even farther back. But the truth is, the emperor (expert opinion) has been caught out wearing a g-string. And nothing much else.

The experts are buck (excuse the term) naked….

Posterboyz of the Science-Industrial Complex: Vol. 1

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The Daily Mail had this in June:

“A scientist who advises the Government on swine flu is a paid director of a drugs firm making hundreds of millions of pounds from the pandemic.

Professor Sir Roy Anderson sits on the Scientific Advisory Group for Emergencies (Sage), a 20-strong task force drawing up the action plan for the virus.

Yet he also holds a £116,000-a-year post on the board of GlaxoSmithKline, the company selling swine flu vaccines and anti-virals to the NHS.”

Note, 25% of that is in the form of shares, so he would directly benefit if the company’s stock were boosted by larger sales. But, apparently, he’s completely unrepentant about it.

There’s more:

During the 2001 foot and mouth outbreak, Sir Roy’s advice to Tony Blair led to the culling of more than 6million animals.

The previous year at Oxford University, Sir Roy was at the centre of controversy after claiming a female colleague had slept with her boss before getting a job. He was forced to apologize and pay compensation.

A university inquiry in the wake of the scandal found that he was in breach of rules by failing to disclose his business interests as director and shareholder of International Biomedical and Health Sciences Consortium – an Oxford-based biomedical consultancy, which had awarded grants to his research centre.

Sir Roy was forced to resign, although his career soon recovered. He moved to Imperial College within months, was made the Ministry of Defence’s chief scientist and, last year, took over as Rector of Imperial College, London where he earns up to £400,000 a year.

If Pigs Flu……

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From Bill Engdahl via Financial Sense.com:

The Pew study notes, ‘That is where the real investigation ought to begin, with the health and sanitary dangers of the industrial factory pig farms like the one at Perote in Veracruz. The media spread of panic-mongering reports of every person in the world who happens to contract ‘symptoms’ which vaguely resemble flu or even Swine Flu and the statements to date of authorities such as WHO or CDC are far from conducive to a rational scientific investigation..

Tamiflu and Rummy

In October 2005 the Pentagon ordered vaccination of all US military personnel worldwide against what it called Avian Flu, H5N1. Scare stories filled world media. Then, Defense Secretary Donald Rumsfeld announced he had budgeted more than $1 billion to stockpile the drug, Oseltamivir sold under the name, Tamiflu. President Bush called on Congress to appropriate another $2 billion for Tamiflu stocks.

What Rumsfeld neglected to report at the time was a colossal conflict of interest. Prior to coming to Washington in January 2001, Rumsfeld had been chairman of a California pharmaceutical company, Gilead Sciences. Gilead Sciences held exclusive world patent rights to Tamiflu, a drug had developed and whose world marketing rights were sold to the Swiss pharma giant, Roche. Rumsfeld was reportedly the largest stock holder in Gilead which got 10% of every Tamiflu dose Roche sold.14 When it leaked out, the Pentagon issued a curt statement to the effect that Secretary Rumsfeld had decided not to sell but to retain his stock in Gilead, claiming that to sell would have indicated something to hide.’ That agonizing decision won him reported added millions as the Gilead share price soared more than 700% in weeks.…….

….. Avian Flu was traced back to huge chicken factory farms in Thailand and other parts of Asia whose products were shipped across the world. Instead of a serious investigation into the sanitary conditions of those chicken factory farms, the Bush Administration and WHO blamed ‘free-roaming chickens’ on small family farms, a move that had devastating economic consequences to the farmers whose chickens were being raised in the most sanitary natural conditions. Tyson Foods of Arkansas and CG Group of Thailand reportedly smiled all the way to the bank.”

Government Profiting from Bailed-out Banks

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In the news, AP reports:

“Critics of the bailout were concerned that the Treasury Department would never see a return on its investment. But the government has already claimed profits from eight of the biggest banks.

The Times cited government profits of $1.4 billion from Goldman Sachs, $1.3 billion from Morgan Stanley and $414 million from American Express. It also listed five other banks — Northern Trust, Bank of New York Mellon, State Street, U.S. Bancorp and BB&T — that each returned profits between $100 million and $334 million.”

The government has also collected about $35 million in profits from 14 smaller banks, the Times reported.

Anne Applebaum on Ted Kennedy

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Robert Bork’s America,” Kennedy declared, “is a land in which women would be forced into back-alley abortions, blacks would sit at segregated lunch counters, rogue police could break down citizens’ doors in midnight raids, schoolchildren could not be taught about evolution, writers and artists could be censored at the whim of the government, and the doors of the federal courts would be shut on the fingers of millions of citizens.”

That image – the women in the back alleys, the doors shutting on the citizens’ fingers – was powerful enough to prevent Bork from winning Senate approval. It is thus not unfair to say that the vitriol that has surrounded Supreme Court nominations ever since is one of Kennedy’s legacies, too….”

— Anne Applebaum in The Telegraph.

My Comment

Ms. Applebaum nails it. The “borking” of not just Supreme Court nominations but of political figures in general goes back to this sad episode in media history.

The Kennedys are American royalty, like the Bushes. So on an occasion like this, it’s probably not appropriate for an outsider to say more. Anyway, I was glad to see that conservatives, even rather shrill ones like Michelle Malkin, have been restrained enough and allowed Ted Kennedy’s family a few days of solemnity and sympathy, before discussing his political or personal flaws.

Why More Swine Flu Deaths in Bangalore?

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From Sify.com:

“State health commissioner P.N. Sreenivasachari told IANS: ‘It’s difficult to say why Karnataka, more precisely Bangalore, which is endowed with adequate healthcare facilities, is witnessing large number of swine flu deaths. We too are puzzled.

‘We can say the virus is already in the air and it’s time people became more aware and cautious to stop the spread of the virus. However, from the point of view of the administration, we have provided adequate healthcare facilities to treat swine flu patients,’ added Sreenivasachari.

Principal secretary (Health) I.R. Perumal said people should not get panicky.

‘People with swine flu like symptoms should immediately get themselves checked, as the city is well equipped to deal with the pandemic,’ added Perumal.

On Friday, two deaths were reported from Bangalore, one came from Bijapur.

My Comment

Why? I have no idea. More international travelers is one reason and a plausible one. But I confess  I couldn’t help thinking about this piece I wrote in 2005, “Terror Hits Bangalore.”

One result of swine flu scare-mongering  will be a shift of money to influenza research – hitherto absent in India. That means funding for drug trials. I wonder who the lucky drug companies are that will benefit?

The two states hit hardest are Karnataka (where Bangalore is) and Maharashtra (where Bombay is). Those are also the states that are the destinations of most foreign travelers and where India’s IT business and stock market are located. Bangalore is the home of a booming biotech business. And a locus of the anti-globalization movement as well. Just thinking out a loud…

Deaths so far are a hundred or less. That’s in a country of roughly a billion and a quarter where tens of thousands die from traffic accidents (300 a day or around 100,000 a year) and from water-borne diseases like diarrhea, typhoid, and jaundice. Hundred of farmers are committing suicide. None of that has qualified for the term pandemic….OR for the accompanying switch in research funding..

Here’s some information on malaria in India in 2008:

“While the official figures state that in 2008 India had 1.5 million malaria cases, resulting in 924 deaths, the real number of deaths is higher by several orders of magnitude.

“These numbers are a joke,” said Sunil Kaul, a doctor who works for a volunteer organization called the Ant that treats villagers. “In Assam alone we had at least 1,500 deaths last year.”

The real number of malaria-related deaths in India was closer to 40,000 in 2008, according to various non-governmental sources and some government officials who didn’t want to be named.”

Under-reporting and lack of knowledge about the disease are two of the main obstacles in retarding the spread of malaria. But interestingly, it’s also international organizations like WHO that obstruct progress in many ways:

“These problems are further complicated by foreign agencies such as the World Health Organization (WHO), which — under the influence of global lending agencies like the World Bank and big pharmaceutical companies — have pushed India to adopt prevention methods that don’t suit the local conditions and to initiate huge, ill-considered projects rather than targeted ones. ….”

More here at The Global Post.