It’s not often that I come across a blog post that so interests and impresses me that I drop everything else and decide to highlight it. The post I am referring to is by David Malone of the Golem XIV blog. The pieces that caught my attention consist of a three part series titled The Next Crisis – A Manifesto for the Supremacy of the 1%. Two parts have been published thus far, with the third section forthcoming.
The reason I believe his work here is so important, is because I think the scenarios he outlines as the plan the global oligarchy intends to put into place during the next crisis are quite possible, if not probable. Knowing the tactics of those who wish to oppress you and lock you into perpetual serfdom is half the battle. We must get inside of the devious minds of these people so that we are prepared for their next assault, which without question, is coming our way.
Indeed, what makes many of his arguments so convincing is that many moves are already being putting into place to ensure their realization. Secret trade treaties, such as the TPP, TTIP and TISA (check out my previous post: How Obama’s Chief Negotiators on the Trans-Pacific Partnership Treaty Received Huge Bonuses from Mega Banks), are a key component of the status quo’s strategy.
So without further ado, here are some excerpts from David’s work:
Of course saying another crisis is coming is like saying we are due a large earthquake in Southern California. True, but it doesn’t mean one is going to happen tomorrow. What I think it does mean is that we should be thinking what our leaders, what the people they work for – the global overclass – might already have in mind or have already put in place, for what they want done next time. I think it would be foolish to imagine they have not thought about it and are not putting in place the things which will close off some futures and force us into others that they prefer. They have so very much to lose and so very much more they want to gain.
To know what the next crisis might look like we first have to look at the conditions today that will form its starting point. Necessarily everything from here on is speculation, nevertheless even when we can’t know what people will do and what ‘events’ will overtake us, we can, I think, discern quite a bit of the general topography, the landscape, of the future.
The first thing we should bear in mind is that however it starts, the next crisis will be another debt-crisis like the current one. This is because debt is now the global currency and global financing mechanism. Once it starts, however, one thing will be very different from the last time – this time nearly all nations are already heavily indebted. Last time they were not. And this is what changes everything for the over-class.
Here are some thoughts on what I think they can do, will do, are already beginning to do and WHY they are doing them.
I think one of the cleverest things the 1% have done over the last few years is the way they have created a relentless public discourse, via their paid political front-men and women and their media empires, to insist on the need to ‘fix’ and protect the system, and the extreme danger to us all should the system not be ‘saved’. This has served as a perfect cover for making sure that not enough people have noticed that the system is, in fact, being gutted and replaced by something that better serves the interests of the 1%. We have not been fixing the banks, we have been feeding them.
1) The Over Class must retain and consolidate their control over the global system of debt.
2) The power to regulate must be taken from nations and effectively controlled by corporations.
3) Professionalize governance. Democracy can be and must be neutered, and an effective way of doing this is to insist that amateur, elected officials MUST take the advice of professional (read corporate) advisors. Expand current law to enforce this.
4) The financial system badly needs un-encumbered ‘assets’ to feed the debt issuing system. A new way must be found to prise sovereign assets from public ownership. Such a new way is suggested.
5) In order to facilitate the political changes necessary, the public mind-set must be changed. National Treasures such as the NHS in Britain must be re-branded as evil State Monopolies.
6) Effective ways must be found to convince people that democratic rule is no longer sufficient to protect them.
7) An alternative to Democracy must be introduced and praised. That alternative must be the Rule of International Law as written and controlled by the lawyers of the 1%. People must be told that this is all that stands between them and an increasingly hostile and anarchic world. But that it can only keep them safe if it has absolute authority over democracy. People must voluntarily bow to it out of fear and its decisions must be as absolute and unquestionable.
And yet, dark as all this may seem, victory for the 1% depends on no one understanding what is happening. If we are already beginning to see the outlines of what the Over Class wants, then their victory is not assured. If our ignorance is their bliss, then our understanding is like sunlight on a vampire’s skin.
All is not lost, not by a bloody long way.
1) Control of debt.
The 1%, through their ownership of the private banking system, must continue to issue and handle the majority of debt and have legal control over the payment of those debts. Power over the system of debt is critical to the 1% and one thing is paramount – there must be nondemocratic, nor public, control of it. That old saying, “give me control over a nation’s currency…” should now read, give me control over a nation’s debt. Debt trumps currency. Which in turn means the 1% must maintain custodial power over the money used to pay those debts.
At the moment, the largest custodial banks are those on Wall Street. Which means any dispute over what happens to that money gets settled in the Southern District Court of Manhattan. And that court has consistently interpreted international law in ways that have elevated the rights of private banks and bond holders over the rights of nations and entire peoples.
It is perhaps THE most important point of any for-profit, debt-based, currency or system (debt doesn’t HAVE to involve interest) that that debt must increase. Not because it is a law of physics nor even that it benefits the 99% (largely it doesn’t) – it happens because it benefits the 1% to whom the interest is owed and more fundamentally because the entire value of the 1%’s debt-based, paper wealth depends upon there being a constant increase in debt. If debt didn’t increase then their wealth would become, first unstable, and then burn to ash. If that seems like I plucked this claim out of thin air I suggest that our present crisis and many others before it are the abundant proof. When the expansion of the global bubble of debt began to slow in 2007 it made the value of all the existing debt-based wealth first uncertain and then implode. Everything done since has been for the sole purpose of reflating the bubble of debt so that debt-based wealth could be said to have value. The 1% will never give up the power they currently enjoy to issue and control the inflation of debt, because their wealth would evaporate if they did.
2) Regulatory power.
One of the areas of power remaining to nations which act as an unwelcome hindrance to global corporate power is the power to regulate. This must be curbed and proposals are already on the table to do so. Such an effort is now enshrined in the multilateral trade agreements currently being agreed behind closed doors: the TPP, TTIP and the one which will remove finance from national control, TISA. These agreements all contain a new approach to regulation which we could summarize as “Our experts, Our data, Our regulations.” In a paper submited to the TTIP negotiations jointly by the US Chamber of Commerce and Businesseurope we find a proposal to adopt what they call “Regulatory Cooperation”. Which the paper says will,
“…put stakeholders [the corporations] at the table with regulators to essentially co-write regulation.” P. 4
The new philosophy, despite its coy claim to being about ‘cooperation’, puts corporations firmly in charge of setting the regulations for themselves and their products on the grounds that only they have the necessary experts, who have the necessary access to the data which is otherwise “confidential”. Or, to appropriate a phrase from the American revolution and use it for demanding more rights for corporations, “No Regulation without Consultation.”
The policy already being written in to the Trade Agreements and given specific teeth by their Investor State Dispute Settlement (ISDS) clauses, is not simply about who regulates what, it is the leading edge of a broad concern to remove any important decisions from democratic control. The ISDS, in case you are not familiar with the jargon, is the clause first used in Bilateral Trade Agreements, now being incorporated into all Trade agreements, which gives corporations the right to take nations to privately run arbitration at which they can sue the nations … and almost always win. And this, for me, is the key point. Disastrous as the Trade Agreements will be in and of themselves, they are a leading edge of this much more profound attack (see below) which I think we will see gathering pace in the next few years
3) Neuter Democracy by Professionalizing Governance.
The Global do not like democracy. In their less guarded comments this is beginning to show. Here is the EU Trade Commissioner, Karel De Gucht, quoted in a piece over at The Automatic Earth talking about the Scottish independence vote,
“A Europe driven by self-determination of peoples … is ungovernable … ”
One of the main ways the 1% can most effectively neuter democratic power (in a way that they can claim it is not their intent at all) – and the regulatory attack contained in the Trade Agreements is just one example – is to advocate professionalizing governance. This has the advantage of sounding good on the surface. Who wouldn’t want professionals giving advice? In practice it will mean that although anyone can still be elected (that can be left in place) there will be a new insistence that they MUST – not ‘can’, but MUST, take the advice of professionals – corporate professionals. And as noted above a good step towards this has already been proposed for trade regulations in the corporate submissions to the TTIP negotiations.
If any of this is put in place then it has the wonderful effect of leaving the politicians effectively powerless, but still in place so as to be the focus of blame. The 1% will hold the real power but the politicians will always take the blame. Any time things go wrong it will be because they made a mistake or did not follow advice as well or as fully as they should. Nothing will ever be the fault of the advice or the advisors.
As long as the 1% make sure the politicians are well taken care of after office, then there will be plenty of takers for the jobs. How utterly empty would the pantomime of our democracy be then?
4) From bail-out-cash to assets-for-pledging.
A Covered Bond would make life so very much simpler for the bond holders. If a nation was induced to issue a Covered Bond then it could be written in to the agreement at the start, which national assets – a train system or oil and gas fields – were the specified and pledged as collateral for this particular bond. The government in charge when the default happened could then say to its electorate, “We’re terribly sorry but its right here in the small print – you – via your government agreed to forfeit these assets if you failed to pay. This is international law which we must obey.” And THAT last phrase is the key which opens the door to the future the 1% want. A future were International Law is held up as the new supreme, and completely non-democratic arbiter of right and wrong. International law would be the new god. And like god would be above the whims and breezes of merely popular wants and desires. People already see the law as somehow above democracy, forgetting that democratic governments wrote the laws and have the power to unwrite them if the people so direct them. This last point is the one will be overlayed and suppressed. I will come back to this.
If a lot of this sounds familiar and seems to be happening already, you are right. Some of it is already “best practice” throughout the Western world, such as politicians merely being puppets. However, David highlights that via secret treaties and laws, the oligarchs will attempt to codify some of these feudal practices so that they can never be successfully challenged legally.
The main exception I take with the piece is the notion of this being the 1%. While that sounds good, the 1% consists of a lot of people, the vast majority of whom have nothing to do with any of this plotting or scheming being the scenes. I would argue the true group of elite power brokers consists of the 0.1%, or probably the 0.001%.
Either way, it isn’t so much about who they are, as much as about what they are trying to accomplish. That is what we need to be acutely aware of going forward, and David does a great job providing a thesis. Check out both parts, there’s a lot more than what I highlighted:
Interestingly enough, as I was composing this post I came across an article in Techdirt that highlights that the UK government is currently in the process of pushing some what David warns about through Parliament as we speak. The article is titled, Is The UK Government Trying To Sneak Through Its Own Corporate Sovereignty Rules? We learn that:
As their name suggests, corporate sovereignty chapters in trade deals are problematic in part because they place corporations on the same level as nations, allowing the former to sue the latter in special tribunals outside national courts. What’s particularly troubling is that companies are now claiming that basic democratic functions, like passing laws promoting health, should be considered a form of “expropriation“, because future corporate profits are reduced. That effectively turns investor-state dispute settlement (ISDS) into a downward regulatory ratchet that makes it very difficult — or at least very expensive — to bring in any new regulations that reduce profits for some business sector.
Despite this — or possibly even because of this — the UK government is currently trying to bring in its own, domestic version of this ratchet. It’s found in a new Bill, simply but significantly called “Deregulation Bill“. It’s a rag-bag of legislative odds and ends, covering things like religious exemption from wearing safety helmets, selling yarn, erection of public statues, repealing the power to block Web sites (brought in by the Digital Economy Act), late night refreshments and –tucked in near the end – the following:
83 Exercise of regulatory functions: economic growth (1) A person exercising a regulatory function to which this section applies must, in the exercise of the function, have regard to the desirability of promoting economic growth. (2) In performing the duty under subsection (1), the person must, in particular, consider the importance for the promotion of economic growth of exercising the regulatory function in a way which ensures that– (a) regulatory action is taken only when it is needed, and (b) any action taken is proportionate.
The Bill goes on to clarify what a “regulatory function” might be:
(a) a function under or by virtue of an Act or subordinate legislation of imposing requirements, restrictions or conditions, or setting standards or giving guidance, in relation to an activity, or (b) a function which relates to the securing of compliance with, or the enforcement of, requirements, restrictions, conditions, standards or guidance which, under or by virtue of an Act or subordinate legislation, relate to an activity.
As that makes clear, the proposed law would apply to pretty much any kind of regulation and its enforcement, and would require the effects on the UK’s economic growth to be considered above everything else. Indeed, there’s no obligation to consider anything else.
Recall that the above rationale, “impact to the economy,” was the excuse Eric Holder and others used to not prosecute and TBTF banks.
They are now trying to formally legalize this charade.