Plato's Cave

Monday, August 29, 2016

A whiff of World War III hangs in the air. In the US, Cold War 2.0 is on, and the anti-Russian rhetoric emanating from the Clinton campaign, echoed by the mass media, hearkens back to McCarthyism and the red scare. In response, many people are starting to think that Armageddon might be nigh - an all-out nuclear exchange, followed by nuclear winter and human extinction. It seems that many people in the US like to think that way. Goodness gracious!

But, you know, this is hardly unreasonable of them. The US is spiraling down into financial, economic and political collapse, losing its standing in the world and turning into a continent-sized ghetto full of drug abuse, violence and decaying infrastructure, its population vice-ridden, poisoned with genetically modified food, morbidly obese, exploited by predatory police departments and city halls, plus a wide assortment of rackets, from medicine to education to real estate… That we know.

We also know how painful it is to realize that the US is damaged beyond repair, or to acquiesce to the fact that most of the damage is self-inflicted: the endless, useless wars, the limitless corruption of money politics, the toxic culture and gender wars, and the imperial hubris and willful ignorance that underlies it all… This level of disconnect between the expected and the observed certainly hurts, but the pain can be avoided, for a time, through mass delusion.

This sort of downward spiral does not automatically spell “Apocalypse,” but the specifics of the state cult of the US - an old-time religiosity overlaid with the secular religion of progress - are such that there can be no other options: either we are on our way up to build colonies on Mars, or we perish in a ball of flame. Since the humiliation of having to ask the Russians for permission to fly the Soyuz to the International Space Station makes the prospect of American space colonies seem dubious, it’s Plan B: balls of flame here we come!

And so, most of the recent American warmongering toward Russia can be explained by the desire to find anyone but oneself to blame for one’s unfolding demise. This is a well-understood psychological move—projecting the shadow—where one takes everything one hates but can’t admit to about oneself and projects it onto another. On a subconscious level (and, in the case of some very stupid people, even a conscious one) the Americans would like to nuke Russia until it glows, but can’t do so because Russia would nuke them right back. But the Americans can project that same desire onto Russia, and since they have to believe that they are good while Russia is evil, this makes the Armageddon scenario appear much more likely.

But this way of thinking involves a break with reality. There is exactly one nation in the world that nukes other countries, and that would be the United States. It gratuitously nuked Japan, which was ready to surrender anyway, just because it could. It prepared to nuke Russia at the start of the Cold War, but was prevented from doing so by a lack of a sufficiently large number of nuclear bombs at the time. And it attempted to render Russia defenseless against nuclear attack, abandoning the Anti-Ballistic Missile Treaty in 2002, but has been prevented from doing so by Russia’s new weapons. These include, among others, long-range supersonic cruise missiles (Kalibr), and suborbital intercontinental missiles carrying multiple nuclear payloads capable of evasive maneuvers as they approach their targets (Sarmat). All of these new weapons are impossible to intercept using any conceivable defensive technology. At the same time, Russia has also developed its own defensive capabilities, and its latest S-500 system will effectively seal off Russia’s airspace, being able to intercept targets both close to the ground and in low Earth orbit.

In the meantime, the US has squandered a fantastic sum of money fattening up its notoriously corrupt defense establishment with various versions of “Star Wars,” but none of that money has been particularly well spent. The two installations in Europe of Aegis Ashore (completed in Romania, planned in Poland) won’t help against Kalibr missiles launched from submarines or small ships in the Pacific or the Atlantic, close to US shores, or against intercontinental missiles that can fly around them. The THAAD installation currently going into South Korea (which the locals are currently protesting by shaving their heads) won’t change the picture either.

There is exactly one nuclear aggressor nation on the planet, and it isn’t Russia. But this shouldn’t matter. In spite of American efforts to undermine it, the logic of Mutual Assured Destruction (MAD) remains in effect. The probability of a nuclear exchange is determined not by anyone’s policy but by the likelihood of it happening by accident. Since there is no winning strategy in a nuclear war, nobody has any reason to try to start one. Under no circumstances is the US ever going to be able to dictate its terms to Russia by threatening it with nuclear annihilation.

If a nuclear war is not in the cards, how about a conventional one? The US has been sabre-rattling by stationing troops and holding drills in the Baltics, right on Russia's western border, installing ABM systems in Romania, Poland and South Korea, supporting anti-Russian Ukrainian Nazis, etc. All of this seems quite provocative; can it result in a war? And what would that war look like?

Here, we have to look at how Russia has responded to previous provocations. These are all the facts that we know, and can use to predict what will happen, as opposed to purely fictional, conjectural statements unrelated to known facts.

When the US or its proxies attack an enclave of Russian citizens outside of Russia's borders, here are the types of responses that we have been able to observe so far:

1. The example of Georgia. During the Summer Olympics in Beijing (a traditional time of peace), the Georgian military, armed and trained by the US and Israel, invaded South Ossetia. This region was part of Georgia in name only, being mostly inhabited by Russian speakers and passport-holders. Georgian troops started shelling its capital, Tskhinval, killing some Russian peacekeeping troops stationed in the region and causing civilian casualties. In response, Russian troops rolled into Georgia, within hours completely eliminating Georgia’s war-making capability. They announced that South Ossetia was de facto no longer part of Georgia, throwing in Abkhazia (another disputed Russian enclave) for good measure, and withdrew. Georgia’s warmongering president Saakashvili was pronounced a “political corpse” and left to molder in place. Eventually he was forced to flee Georgia, where he has been declared a fugitive from justice. The US State Department recently gave him a new job, as Governor of Odessa in the Ukraine. Recently, Russian-Georgian relations have been on the mend.

2. The example of Crimea. During the Winter Olympics in Sochi, in Russia (a traditional time of peace) there occurred an illegal, violent overthrow of the elected, constitutional government of the Ukraine, followed by the installation of a US-picked puppet administration. In response, the overwhelmingly Russian population of the autonomous region of Crimea held a referendum. Some 95% of them voted to secede from the Ukraine and to once again become part of Russia, which they had been for centuries and until very recently. The Russians then used their troops already stationed in the region under an international agreement to make sure that the results of the referendum were duly enacted. Not a single shot was fired during this perfectly peaceful exercise in direct democracy.

3. The example of Crimea again. During the Summer Olympics in Rio (a traditional time of peace) a number of Ukrainian operatives stormed the Crimean border and were swiftly apprehended by Russia's Federal Security Service, together with a cache of weapons and explosives. A number of them were killed in the process, along with two Russians. The survivors immediately confessed to planning to organize terrorist attacks at the ferry terminal that links Crimea with the Russian mainland and a railway station. The ringleader of the group confessed to being promised the princely sum of $140 for carrying out these attacks. All of them are very much looking forward to a warm, dry bunk and three square meals of day, care of the Russian government, which must seem like a slice of heaven compared to the violence, chaos, destitution and desolation that characterizes life in present-day Ukraine. In response, the government in Kiev protested against “Russian provocation,” and put its troops on alert to prepare against “Russian invasion.” Perhaps the next shipment of US aid to the Ukraine should include a supply of chlorpromazine or some other high-potency antipsychotic medication.

Note the constant refrain of “during the Olympics.” This is not a coincidence but is indicative of a certain American modus operandi. Yes, waging war during a traditional time of peace is both cynical and stupid. But the American motto seems to be “If we try something repeatedly and it still doesn't work, then we just aren’t trying hard enough.” In the minds of those who plan these events, the reason they never work right can’t possibly have anything to do with it being stupid. This is known as “Level III Stupid”: stupidity so profound that it is unable to comprehend its own stupidity.

4. The example of Donbass. After the events described in point 2 above, this populous, industrialized region, which was part of Russia until well into the 20th century and is linguistically and culturally Russian, went into political turmoil, because most of the locals wanted nothing to do with the government that had been installed in Kiev, which they saw as illegitimate. The Kiev government proceeded to make things worse, first by enacting laws infringing on the rights of Russian-speakers, then by actually attacking the region with the army, which they continue to do to this day, with three unsuccessful invasions and continuous shelling of both residential and industrial areas, in the course of which over ten thousand civilians have been murdered and many more wounded. In response, Russia assisted with establishing a local resistance movement supported by a capable military contingent formed of local volunteers. This was done by Russian volunteers, acting in an unofficial capacity, and by Russian private citizens donating money to the cause. In spite of Western hysteria over “Russian invasion” and “Russian aggression,” no evidence of it exists. Instead, the Russian government has done just three things: it refused to interfere with the work of its citizens coming to the aid of Donbass; it pursued a diplomatic strategy for resolving the conflict; and it has provided numerous convoys of humanitarian aid to the residents of Donbass. Russia’s diplomatic initiative resulted in two international agreements—Minsk I and Minsk II—which compelled both Kiev and Donbass to pursue a strategy of political resolution of the conflict through cessation of hostilities and the granting to Donbass of full autonomy. Kiev has steadfastly refused to fulfill its obligations under these agreements. The conflict is now frozen, but continuing to bleed because of Ukrainian shelling, waiting for the Ukrainian puppet government to collapse.

To complete the picture, let us include Russia’s recent military action in Syria, where it came to the defense of the embattled Syrian government and quickly demolished a large part of ISIS/ISIL/Daesh/Islamic Caliphate, along with various other terrorist organizations active in the region. The rationale for this action is that Russia saw a foreign-funded terrorist nest in Syria as a direct threat to Russia’s security. Two other notable facts here are that Russia acted in accordance with international law, having been invited by Syria’s legitimate, internationally recognized government and that the military action was scaled back as soon as it seemed possible for all of the legitimate (non-terrorist) parties to the conflict to return to the negotiating table. These three elements—using military force as a reactive security measure, scrupulous adherence to international law, and seeing military action as being in the service of diplomacy—are very important to understanding Russia’s methods and ambitions.

Turning now to US military/diplomatic adventures, we see a situation that is quite different. US military spending is responsible for over half of all federal discretionary spending, dwarfing most other vitally important sectors, such as infrastructure, public medicine and public education. It serves several objectives. Most importantly, it is a public jobs program: a way of employing people who are not employable in any actually productive capacity due to lack of intelligence, education and training. Second, it is a way for politicians and defense contractors to synergistically enrich themselves and each other at the public’s expense. Third, it is an advertising program for weapons sales, the US being the top purveyor of lethal technology in the world. Last of all, it is a way of projecting force around the world, bombing into submission any country that dares oppose Washington’s global hegemonic ambitions, often in total disregard of international law. Nowhere on this list is the actual goal of defending the US.

None of these justifications works vis-à-vis Russia. In dollar terms, the US outspends Russia on defense hands down. However, viewed in terms of purchasing parity, Russia manages to buy as much as ten times more defensive capability per unit national wealth than the US, largely negating this advantage. Also, what the US gets for its money is inferior: the Russian military gets the weapons it wants; the US military gets what the corrupt political establishment and their accomplices in the military-industrial complex want in order to enrich themselves. In terms of being an advertising campaign for weapons sales, watching Russian weaponry in action in Syria, effectively wiping out terrorists in short order through a relentless bombing campaign using scant resources, then seeing US weaponry used by the Saudis in Yemen, with much support and advice from the US, being continuously defeated by lightly armed insurgents, is unlikely to generate too many additional sales leads. Lastly, the project of maintaining US global hegemony seems to be on the rocks as well. Russia and China are now in a de facto military union. Russia’s superior weaponry, coupled with China’s almost infinitely huge infantry, make it an undefeatable combination. Russia now has a permanent air base in Syria, has made a deal with Iran to use Iranian military bases, and is in the process of prying Turkey away from NATO. As the US military, with its numerous useless bases around the world and piles of useless gadgets, turns into an international embarrassment, it remains, for the time being, a public jobs program for employing incompetents, and a rich source of graft.

In all, it is important to understand how actually circumscribed American military capabilities are. The US is very good at attacking vastly inferior adversaries. The action against Nazi Germany only succeeded because it was by then effectively defeated by the Red Army—all except for the final mop-up, which is when the US came out of its timid isolation and joined the fray. Even North Korea and Vietnam proved too tough for it, and even there its poor performance would have been much poorer were it not for the draft, which had the effect of adding non-incompetents to the ranks, but produced the unpleasant side-effect of enlisted men shooting their incompetent officers—a much underreported chapter of American military history. And now, with the addition of LGBTQ people to the ranks, the US military is on its way to becoming an international laughing stock. Previously, terms like “faggot” and “pussy” were in widespread use in the US military’s basic training. Drill sergeants used such terminology to exhort the “numb-nuts” placed in their charge to start acting like men. I wonder what words drill sergeants use now that they’ve been tasked with training those they previously referred to as “faggots” and “pussies”? The comedic potential of this nuance isn’t lost on Russia’s military men.

This comedy can continue as long as the US military continues to shy away from attacking any serious adversary, because if it did, comedy would turn to tragedy rather quickly.

If, for instance, US forces tried to attack Russian territory by lobbing missiles across the border, they would be neutralized in instantaneous retaliation by Russia’s vastly superior artillery.
If Americans or their proxies provoked Russians living outside of Russia (and there are millions of them) to the point of open rebellion, Russian volunteers, acting in an unofficial capacity and using private funds, would quickly train, outfit and arm them, creating a popular insurgency that would continue for years, if necessary, until Americans and their proxies capitulate.
If the Americans do the ultimately foolish thing and invade Russian territory, they would be kettled and annihilated, as repeatedly happened to the Ukrainian forces in Donbass.
Any attempt to attack Russia using the US aircraft carrier fleet would result in its instantaneous sinking using any of several weapons: ballistic anti-ship missiles, supercavitating torpedos or supersonic cruise missiles.
Strategic bombers, cruise missiles and ballistic missiles would be eliminated by Russia’s advanced new air defense systems.

So much for attack; but what about defense? Well it turns out that there is an entire separate dimension to engaging Russia militarily. You see, Russia lost a huge number of civilian lives while fighting off Nazi Germany. Many people, including old people, women and children, died of starvation and disease, or from German shelling, or from the abuse they suffered at the hands of German soldiers. On the other hand, Soviet military casualties were on par with those of the Germans. This incredible calamity befell Russia because it had been invaded, and it has conditioned Russian military thinking ever since. The next large-scale war, if there ever is one, will be fought on enemy territory. Thus, if the US attacks Russia, Russia will counterattack the US mainland. Keeping in mind that the US hasn’t fought a war on its own territory in over 150 years, this would come as quite a shock.

Of course, this would be done in ways that are consistent with Russian military thinking. Most importantly, the attack must be such that the possibility of triggering a nuclear exchange remains minimized. Second, the use of force would be kept to the minimum required to secure a cessation of hostilities and a return to the negotiating table on terms favorable to Russia. Third, every effort would be made to make good use of internal popular revolts to create long-lasting insurgencies, letting volunteers provide the necessary arms and training. Lastly, winning the peace is just as important as winning the war, and every effort would be made to inform the American public that what they are experiencing is just retribution for certain illegal acts. From a diplomatic perspective, it would be much more tidy to treat the problem of war criminals running the US as an internal, American political problem, to be solved by Americans themselves, with an absolute minimum of outside help. This would best be accomplished through a bit of friendly, neighborly intelligence-sharing, letting all interested parties within the US know who exactly should be held responsible for these war crimes, what they and their family members look like, and where they live.

The question then is, What is the absolute minimum of military action—what I am calling “a thousand balls of fire,” named after George Bush Senior’s “a thousand points of light”—to restore peace on terms favorable to Russia? It seems to me that 1000 “balls of fire” is just about the right number. These would be smallish explosions—enough to demolish a building or an industrial installation, with almost no casualties. This last point is extremely important, because the goal is to destroy the system without actually directly hurting any of the people. It wouldn’t be anyone else’s fault if people in the US suffer because they refuse to do as their own FEMA asks them to do: stockpile a month’s worth of food and water and put together an emergency evacuation plan. In addition, given the direction in which the US is heading, getting a second passport, expatriating your savings, and getting some firearms training just in case you end up sticking around are all good ideas.

The reason it is very important for this military action to not kill anyone is this: there are some three million Russians currently residing in the US, and killing any of them is definitely not on strategy. There is an even larger number of people from populous countries friendly to Russia, such as China and India, who should also remain unharmed. Thus, a strategy that would result in massive loss of life would simply not be acceptable. A much better scenario would involve producing a crisis that would quickly convince the Russians living in the US (along with all the other foreign nationals and first-generation immigrants, and quite a few of the second-generation immigrants too) that the US is no longer a good place to live. Then all of these people could be repatriated—a process that would no doubt take a few years. Currently, Russia is the number three destination worldwide for people looking for a better place to live, after the US and Germany. Germany is now on the verge of open revolt against Angela Merkel’s insane pro-immigration policies. The US is not far behind, and won’t remain an attractive destination for much longer. And that leaves Russia as the number one go-to place on the whole planet. That’s a lot of pressure, even for a country that is 11 time zones wide and has plenty of everything except tropical fruit and people.

We must also keep in mind that Israel—which is, let’s face it, a US protectorate temporarily parked on Palestinian land—wouldn’t last long without massive US support. Fully a third of Israeli population happens to be Russian. The moment Project Israel starts looking defunct, most of these Russian Jews, clever people that they are, will no doubt decide to stage an exodus and go right back to Russia, as is their right. This will create quite a headache for Russia’s Federal Migration Service, because it will have to sift through them all, letting in all the normal Russian Jews while keeping out the Zionist zealots, the war criminals and the ultra-religious nutcases. This will also take considerable time.

But actions that risk major loss of life also turn out to be entirely unnecessary, because an effective alternative strategy is available: destroy key pieces of government and corporate infrastructure, then fold your arms and wait for the other side to crawl back to the negotiating table waving a white rag. You see, there are just a few magic ingredients that allow the US to continue to exist as a stable, developed country capable of projecting military force overseas. They are: the electric grid; the financial system; the interstate highway system; rail and ocean freight; the airlines; and oil and gas pipelines. Disable all of the above, and it’s pretty much game over. How many “balls of flame” would that take? Probably well under a thousand.

Disabling the electric grid is almost ridiculously easy, because the system is very highly integrated and interdependent, consisting of just three sub-grids, called “interconnects”: western, eastern and Texas. The most vulnerable parts of the system are the Large Power Transformers (LPTs) which step up voltages to millions of volts for transmission, and step them down again for distribution. These units are big as houses, custom-built, cost millions of dollars and a few years to replace, and are mostly manufactured outside the US. Also, along with the rest of the infrastructure in the US, most of them are quite old and prone to failure. There are several thousand of these key pieces of equipment, but because the electric grid in the US is working at close to capacity, with several critical choke points, it would be completely disabled if even a handful of the particularly strategic LPTs were destroyed. In the US, any extended power outage in any of the larger urban centers automatically triggers large-scale looting and mayhem. Some estimate that just a two week long outage would push the situation to a point of no return, where the damage would become too extensive to ever be repaired.

Disabling the financial system is likewise relatively trivial. There are just a few choke points, including the Federal Reserve, a few major banks, debit and credit card company data centers, etc. They can be disabled using a variety of methods, such as a cruise missile strike, a cyberattack, electric supply disruption or even civil unrest. It bears noting that the financial system in the US is rigged to blow even without foreign intervention. The combination of runaway debt, a gigantic bond bubble, the Federal Reserve trapped into ever-lower interest rates, underfunded pensions and other obligations, hugely overpriced real estate and a ridiculously frothy stock market will eventually detonate it from the inside.

A few more surgical strikes can take out the oil and gas pipelines, import terminals, highway bridges and tunnels, railroads and airlines. A few months without access to money and financial services, electricity, gasoline, diesel, natural gas, air transport or imported spare parts needed to repair the damage should be enough to force the US to capitulate. If it makes any efforts to restore any of these services, an additional strike or two would quickly negate them.

The number of “balls of flame” can be optimized by taking advantage of destructive synergies: a GPS jammer deployed near the site of an attack can prevent responders from navigating to it; taking out a supply depot together with the facility it serves, coupled with transportation system disruptions, can delay repairs by many months; a simple bomb threat can immobilize a transportation hub, making it a sitting duck instead of a large number of moving targets; etc.

You may think that executing such a fine-tuned attack would require a great deal of intelligence, which would be difficult to gather, but this is not the case. First, a great deal of tactically useful information is constantly being leaked by insiders, who often consider themselves “patriots.” Second, what hasn’t been leaked can be hacked, because of the pitiable state of cybersecurity in the US. Remember, Russia is where anti-virus software is made—and a few of the viruses too. The National Security Agency was recently hacked, and its crown jewels stolen; if it can be hacked, what about all those whose security it supposedly protects?

You might also think that the US, if attacked in this manner, could effectively retaliate in kind, but this scenario is rather difficult to imagine. Many Russians don’t find English too difficult, are generally familiar with the US through exposure to US media, and the specialists among them, especially those who have studied or taught at universities in the US, can navigate their field of expertise in the US almost as easily as in Russia. Most Americans, on the other hand, can barely find Russia on a map, can’t get past the Cyrillic alphabet and find Russian utterly incomprehensible.

Also consider that Russia’s defense establishment is mainly focused on... defense. Offending people in foreign lands is not generally seen as strategically important. “A hundred friends is better than a hundred rubles” is a popular saying. And so Russia manages to be friends with India and Pakistan at the same time, and with China and Vietnam. In the Middle East, it maintains cordial relations with Turkey, Syria, Israel, Saudi Arabia, Yemen, Egypt and Iran, also all at the same time. Russian diplomats are required to keep channels of communication open with friends and adversaries alike, at all times. Yes, being inexplicably adversarial toward Russia can be excruciatingly painful, but you can make it stop any time! All it takes is a phone call.

Add to this the fact that the vicissitudes of Russian history have conditioned Russia’s population to expect the worst, and simply deal with it. “They can’t kill us all!” is another favorite saying. If Americans manage to make them suffer, the Russian people would no doubt find great solace in the fact they are making the Americans suffer even worse, and many among them would think that this achievement, in itself, is already a victory. Nor will they remain without help; it is no accident that Russia’s Minister of Defense, Sergei Shoigu, previously ran the Emergencies Ministry, and his performance at his job there won him much adulation and praise. In short, if attacked, the Russians will simply take their lumps—as they always have—and then go on to conquer and win, as they always have.

It doesn’t help matters that most of what little Americans have been told about Russia by their political leaders and mass media is almost entirely wrong. They keep hearing about Putin and the “Russian bear,” and so they are probably imagining Russia to be a vast wasteland where Vladimir Putin keeps company with a chess-playing, internet server-hacking, nuclear physicist, rocket scientist, Ebola vaccine-inventing, polyglot, polymath bear. Bears are wonderful, Russians love bears, but let’s not overstate things. Yes, Russian bears can ride bicycles and are sometimes even good with children, but they are still just wild animals and/or pets (many Russians can’t draw that distinction). And so when the Americans growl about the “Russian bear,” the Russians wonder, Which one?

In short, Russia is to most Americans a mystery wrapped in an enigma, and there simply isn’t a large enough pool of intelligent Americans with good knowledge of Russia to draw upon, whereas to many Russians the US is an open book. As far as the actual American “intelligence” and “security” services, they are all bloated bureaucratic boondoggles mired in political opportunism and groupthink that excel at just two things: unquestioningly following idiotic procedures, and creatively fitting the facts to the politics du jour. “Proving” that Iraq has “weapons of mass destruction”—no problem! Telling Islamist terrorists apart from elderly midwestern grandmothers at an airport security checkpoint—no can do!

Russia will not resort to military measures against the US unless sorely provoked. Time and patience are on Russia’s side. With each passing year, the US grows weaker and loses friends and allies, while Russia grows stronger and gains friends and allies. The US, with its political dysfunction, runaway debt, decaying infrastructure and spreading civil unrest, is a dead nation walking. It will take time for each of the United States to neatly demolish themselves into their own footprints, like those three New York skyscrapers did on 9/11 (WTC #1, #2 and #7) but Russia is very patient. Russia is ready to respond to any provocation, but the last thing the Russians want is another war. And that, if you like good news, is the best news you are going to hear. But if you still think that there is going to be a war with Russia, don’t think “Armageddon”; think “a thousand balls of flame,” and then—crickets!

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America The Debt Pig: We Are A ‘Buy Now, Pay Later’ Society – And ‘Pay Later’ Is Rapidly Approaching

ORIGINAL LINK

If you really wanted to live like a millionaire, you could start doing it right now. All you have to do is to apply for as many credit cards as possible and then begin running up credit card balances like there is no tomorrow. At this point, I know what most of you are probably thinking. You are probably thinking that such a lifestyle would not last for long and that a day of reckoning would eventually come, and you would be exactly right. In fact, anyone that has ever had a tremendous amount of credit card debt knows how painful that day of reckoning can be. To mindlessly run up credit card debt is exceedingly reckless, but unfortunately that is precisely what we have been doing as a nation as a whole. We are a “buy now, pay later” society, and our national day of reckoning is approaching very, very quickly.

Often we like to focus on our exploding national debt, but household debt is out of control too. In fact, the total amount of household debt in the United States is now up to a whopping 12.3 trillion dolllars…

In the second quarter, total household debt increased by $35 billion to $12.3 trillion, according to the New York Fed’s latest quarterly report on household debt. That increase was driven by two categories: auto loans and credit cards.

We throw around words like “trillion” so often these days that they often start to lose their meaning. But the truth is that 12.3 trillion dollars is an astounding amount of money. It breaks down to about $38,557 for every man, woman and child in the entire country. So if you have a family of four, your share comes to a grand total of $154,231, and that doesn’t even include corporate debt, local government debt, state government debt or the gigantic debt of the federal government. That number is only for household debt, and there aren’t too many Americans that could cough up their share right at this moment.

Do you remember when I wrote about how credit card companies are specifically targeting less educated and less sophisticated consumers? Well, that is where much of the credit card debt growth has come lately. Just check out these numbers…

Now, credit cards are returning among individuals with low credit or subprime credit scores below 660. Among people with credit scores between 620 and 660, the share that had a credit card rose to 58.8% in 2015 from a low of 54.3% in 2013. Among those with scores below 620, the number of people with a credit card increased to 50% from a low of 45.6% two years ago. Both figures for 2015 are the highest since 2008.

In America today, we are enjoying a standard of living that we do not deserve.

We consume far more wealth than we produce. The only way we are able to do that is by going into debt.

Debt takes future consumption and brings it into the present. In other words, we are damaging the future in order to make the present a little bit better. On an individual level, we may enjoy the big screen television we buy with a credit card today, but we are taking away our ability to spend money later. And on a national level, what our unprecedented debt binge is doing to future generations of Americans is beyond criminal.

Earlier this month I explained these things to a live studio audience down at Morningside, and you can view a video of that right here…

In this article I haven’t even talked about corporate debt yet. Instead of learning their lessons from the last financial crisis, big corporations have gone on the biggest debt spree of all time. If you can believe it, corporate debt has approximately doubled since the last financial crisis. In other words, since the last recession we have essentially matched the total amount of corporate debt that we accumulated from the beginning of the country up to 2009.

Unfortunately, a lot of that debt is now going bad.

In previous articles I have documented that corporate debt delinquencies are now the highest that they have been since the last financial crisis, and corporate debt defaults are also the highest that they have been since the last financial crisis.

At this point, even the mainstream media is acknowledging that we have a corporate debt “crisis”. The following comes from an article that was just put out by the Denver Post…

The number of companies that have defaulted so far this year has already passed the total for all of last year, which itself had the most since the financial crisis. Even among companies considered high-quality, or investment grade, credit-rating agencies say a record number are so stretched financially that they’re one bad quarter or so from being downgraded to “junk” status.

Companies whose debt is already deemed “junk” are in the worst shape in years. To pay back all they owe, they would have to set aside every dollar of their operating earnings over the next eight and a half years, more than twice as long as it would have taken during the 2008 crisis, according to Bank of America Merrill Lynch.

Are you starting to get the picture?

And I haven’t even started talking about our national debt yet. When Barack Obama entered the White House, we were 10.6 trillion dollars in debt. Today, we are 19.4 trillion dollars in debt. That means that we have added 8.8 trillion dollars to the national debt under Obama, which breaks down to an average of 1.1 trillion dollars of additional debt a year.

We have been taking more than 100 million dollars of future consumption and bringing it into the present every single hour of every single day during the Obama administration. That is why I am constantly referring to our “debt-fueled standard of living”. We do not deserve to live the way that we do, but since we are able to steal from our children and our grandchildren we are able to enjoy a standard of living that most people in the world can only dream about.

Of course we are literally destroying the future of America in the process, but very few people seem to care about that these days.

Without all of this debt, we would be in a very deep economic depression right now.

But even with all of this “stimulus”, we are still mired in the worst economic “recovery” since 1949. In fact, Barack Obama is actually on track to be the very first president in all of American history to not have one single year when U.S. GDP grew by 3 percent or better, and he has had two terms in which to try to get that accomplished. The percentage of working age Americans that actually have a job is way down from where it was just prior to the last recession, and in this video I explain why the employment numbers put out by the government are not nearly as good as the administration would have us believe…

If the American people would have been willing to sacrifice and make some very hard choices a long time ago, maybe we could have gotten a handle on all of this debt.

But instead we continue to rack up debt as if there is no tomorrow, and in the process we are literally destroying tomorrow.

Every dollar of debt that we accumulate now makes life worse for our children and our grandchildren.

Unfortunately, we are a bunch of debt pigs, and we just can’t help ourselves. We have come to believe that it is “normal” to go into so much debt, and as a society we continue to race toward economic oblivion.

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Ruling Against Burkini Ban Hinges on the Meaning of 'Decency' and 'Public Order'

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Last Friday's decision overturning a local burkini ban in France was a welcome victory for tolerance and religious freedom. But it relied on a narrow reading of public policy goals that supporters of such bans, including French Prime Minister Manuel Valls, define more broadly. That broader interpretation was accepted by a lower court in this case and by courts hearing challenges to other restrictions on religiously motivated clothing.

The Council of State, France's top administrative court, ruled that the mayor of Villeneuve-Loubet, one of more than 30 seaside towns that have forbidden women to wear full-body swimsuits, exceeded his legal authority as protector of safety, hygiene, decency, and public order on the beach. Limits on freedom "must be justified by proven risks of harm to public order," the court said, and the city has failed to demonstrate any such risk from allowing women to wear burkinis.

"In the absence of such risks," the court added, "emotions and concerns arising from terrorist attacks, including those committed in Nice on July 14, will not suffice to justify in law the contested prohibition." Hence "the contested decree has imposed a serious and manifestly illegal restraint on fundamental freedoms such as freedom to come and go, freedom of conscience, and personal freedom."

Villeneuve-Loubet's ban, like the others, did not mention Islam specifically. Instead it banned swimwear that is not "respectful of morality and the principle of secularism, and in compliance with hygiene and safety rules." Whether such a command is legal depends on how you understand "decency" and "public order," two inherently subjective justifications for municipal beach regulations. In a ruling last Monday, a judge of the Nice Administrative Court deemed the burkini ban a "necessary, appropriate, and proportionate" precaution aimed at preventing public disorder following recent terrorist assaults, especially the truck attack that killed 86 people in Nice on July 14. The Council of State rejected that rationale, viewing "emotions and concerns arising from terrorist attacks" as irrelevant to the ban's legality.

Although the burkini ban cited "the principle of secularism" as a justification, Valls argues that such laws have nothing to do with religion per se. "The burkini is not a religious sign," he says on Facebook. "It is the affirmation of political Islam in the public space." Valls has also called the burkini a tool for "the enslavement of women." He insists that last week's ruling "doesn't exhaust the debate that has opened up in our society on the question of the burkini."

Defending its ban on full-face veils in public, the French government likewise claimed "the practice was a recent phenomenon which was not required by religion but arose from radicalization and extremism" and maintained that it violated the principle of gender equality. In 2014 the European Court of Human Rights rejected the latter rationale but agreed that the law was justified to protect "public safety" and "the rights and freedom of others." The court reasoned that wearing a veil is inconsistent with "respect for the minimum requirements of life in society" because "the barrier raised against others by a veil concealing the face is perceived…as breaching the right of others to live in a space of socialization which makes living together easier."

In other words, the veil causes social disharmony by offending people. Supporters of burkini bans believe the same is true of excessively modest swimwear. Once such considerations are admitted as legitimate rationales for restricting freedom, it is hard to find a principled stopping point.

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Saturday, August 27, 2016

“I’ve Never Seen Anything Like This Before" - The Housing Markets In The Hamptons, Aspen And Miami Are All Crashing

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One month ago, we said that "it is not looking good for the US housing market", when in the latest red flag for the US luxury real estate market, we reported that sales in the Hamptons plunged by half and home prices fell sharply in the second quarter in the ultra-wealthy enclave, New York's favorite weekend haunt for the 1%-ers.

Reuters blamed this on "stock market jitters earlier in the year" which damped the appetite to buy, however one can also blame the halt of offshore money laundering, a slowing global economy, the collapse of the petrodollar, and the drastic drop in Wall Street bonuses. In short: a sudden loss of confidence that a greater fool may emerge just around the corner, which in turn has frozen buyer interest.

A beachfront residence is seen in East Hampton, New York, March 16, 2016.

We concluded this is just the beginning, and sure enough, several weeks later a similar collapse in the luxury housing segment was reported in a different part of the country. As the Denver Post reported recently, high-end sales that fuel Aspen’s $2 billion-a-year real estate market are evaporating, pushing Pitkin County’s sales volume down more than 42 percent to $546.45 million for the first half of the year from $939.91 million in the same period of 2015.

The collapse in transactions means that Aspen’s high-end real estate market "one of the most robust in the country, with dozens of options for buyers ready to spend more than $10 million" finds itself in its first-ever sustained nosedive, despite "dense summer crowds, soaring sales tax revenues and high lodging occupancy."

Like in the Hamptons, the question everyone is asking is "why"? There are many answers:

Ask a dozen market watchers why, and you’ll get a dozen answers. Uncertainty around the presidential election. Fear of Trump. Fear of Clinton. Growing trade imbalances with China. Brexit. Roller-coaster oil prices. Zika. Wobbling economies in South America. The list goes on.

“People are worried about all kinds of stuff these days,” says longtime Aspen broker Bob Ritchie. “I’ve never seen anything like this before.”

The speed of the collapse has been stunning. Until just last year, the local market was beyond robust, with Pitkin County real estate sales hitting $2 billion in 2015, a 33% annual increase driven largely by sales of homes in Aspen, where prices average $7.7 million.

This year, however, "a slowdown in January turned into a free fall." Sales volume in Pitkin County is down 42%, according to data compiled by Land Title Guarantee Co.

Almost all of that decline is coming from Aspen, where the market is frozen. Sales in the Aspen-Snowmass market in the first half of the year were the bleakest since the first half of 2009, and inventory soared to levels not seen since the recession.

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High-end sales that fuel Aspen’s $2 billion-a-year real estate market are evaporating

The statistics are stunning: single-family home sales in Aspen are down 62% in dollar volume through the first-half of the year. Sales of homes priced at $10 million or more — almost always paid for in cash — are down 60%. Last year, super-high-end transactions accounted for nearly a third of sales volume in Pitkin County.

“The high-end buyer has disappeared,” said Tim Estin, an Aspen broker whose Estin Report analyzes the Aspen-Snowmass real estate market.

"Aspen has never experienced such a sudden and precipitous drop in real estate sales," according to the post.

Worse, it's not just the collapse in the number of transaction: even more disconcerting for brokers who have always trumpeted Aspen as a safe and lucrative place to park a huge pile of money: Prices are dropping.

In the first half of this year, the average price per square foot of Aspen homes dropped 22 percent to $1,095 from $1,338 in 2015. Recent Aspen sales also closed at more than 15 percent below listing price, a rare discount.

Some brokers suspect that the frenzied sales and pricing pace of 2015 was not sustainable. The present decline is a correction, they say. “I think a lot of people thought we would go to the next level in 2016. Take the next step up and that step got resistance from buyers,” said longtime Aspen broker Joshua Saslove, who just put an Aspen home for more than $10 million under contract. If it closes, it will be just the fourth sale above $10 million in Aspen this year, compared with more than a dozen by this point last year.

“I think a lot of developers thought they would push their, say, $5 million properties to $6 million this year, but no one is buying,” Saslove said. “I don’t see that nonchalance or cavalier attitude any more.”

To be sure, Saslove is hoping that a rebound is coming; that however, may be overly optimistic and first far more pain is in store especially if one considers what is taking place in yet another formerly red-hot housing market, where suddenly things are just as bad, because as Mansion Global reports...

Luxury condo sales in Miami have crashed 44%.

According to the latest report by the Miami Association of Realtors, the local luxury housing market is just as bad, if not worse, than the Hamptons and Aspen.

The latest figures out of Miami this week showed residential sales are down almost 21% from the same time last year. But as bad as this double-digit decline may seem, it pales in comparison to what’s happening at the high end of the market.

A closer look at transactions for properties of $1 million or more in July shows just 73 single-family home sales, representing an annual decline of 31.8%, according to a new report by the Miami Association of Realtors. In the case of condos in the same price range, the number of closed sales fell by an even wider margin: 44.4%, to 45 transactions.

The Miami housing market, and its luxury segment in particular, has been softening for the past year with high-end condos sitting on the market for twice as long as they did a year ago and sellers offering bigger discounts amid an increased supply.

Number of closed sales for Miami condos priced over $1 million fell by 44%

In July, townhouses and condos of $1 million or more waited, on average, 162 days for a buyer, a 1.9% increase over a year ago and the longest time of any other price range, according to the report.

As in the previous two markets, the locals want something to blame, in this case the strong dollar, which has significantly increased the value of properties in other currencies, has been blamed, and perhaps rightfully so as sales to foreigners—an important client base, since international buyers acquire more homes in Florida than in any other state, according to the National Association of Realtors - have tumbled.

Real estate appraiser and data expert Jonathan Miller said that Miami is behaving like most of the rest of the U.S. housing market, which is in fairly good shape overall “but soft at the top.”

As noted here over the years, In the case of Miami, like in other most other coastal markets such as New York and Los Angeles, the housing boom was heavily boosted by foreign buyers, who used US luxury real estate as their new form of anonymous "offshore bank accounts" courtesy of the NAR's exemption from Anti-Money Laundering Provisions. However, after the recent drops in commodity prices and the spike in the USD, they have scaled back their purchases.

“The international component is not as intense,” Mr. Miller said.

Depsite the slowdown deals are still being done, with cash the preferred form of payment of foreign buyers in the U.S., - some 43% of all sales in Miami in July were closed in cash, however down from 48.1% the same month last year, according to the latest figures.

Other potential buyers are also stepping back: cash sales for townhouses and condominiums, an indicator of investor activity, hit their lowest level in a year last month: 633 transactions, representing a 30.4% year-over-year decline, according to the report.

As for the forecast for the coming months, sales activity doesn’t look likely to surge. There were 1,272 pending sales of townhouses and condos in Miami in July, which means 25.4% fewer transactions waiting to close than in the same month in 2015 and the lowest number so far this year. Meanwhile, as a result of a building boom, luxury condo inventory is up 47.8% from last year, with 2,482 units worth $1 million or more waiting to change hands; this means that sellers of high-end condos will continue to face stiff competition, prompting even fewer transactions and/or lower prices.

So far, the collapse at the luxury end has failed to transmit to the broader market, less impacted by lack of foreign demand, however as we documented two weeks ago, it is only a matter of time before the overall US housing market suffers as well. The only question is whether the NAR and the US Census Bureau, who tabulate the "goal-seeked", seasonally adjusted data, will admit it before or after the presidential elections. The likely answer: it depends on who the next president is.

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GMO Maize Triggers Tumors in Rats: New Email Leak Shows How Monsanto Stifles Criticism

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The Seralini debacle is a perfect case study of how industry conspires with cooperative scientists to help bury information that is harmful to its commercial interests. Monsanto is one of the most hated companies on the planet. …Unless you ask …

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Friday, August 26, 2016

The Clinton’s Bogus “Humanitarian” War On Serbia—-Stunning New Evidence

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By John Pilger The exoneration of a man accused of the worst of crimes, genocide, made no headlines. Neither the BBC nor CNN covered it. The Guardian allowed a brief commentary. Such a rare official admission was buried or suppressed, understandably. It would explain too much about how the rulers of the world rule. The International…

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Most Scientific Findings Are Wrong or Useless

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ScientistYanlevDreamstime "Science, the pride of modernity, our one source of objective knowledge, is in deep trouble." So begins "Saving Science," an incisive and deeply disturbing essay by Daniel Sarewitz at The New Atlantis. As evidence, Sarewitz, a professor at Arizona State University's School for Future Innovation and Society, points to reams of mistaken or simply useless research findings that have been generated over the past decades.

Sarewitz cites several examples of bad science that I reported in my February article "Broken Science." These include a major biotech company's finding in 2012 that only six out of 53 landmark published preclinical cancer studies could be replicated. Researchers at a leading pharmaceutical company reported that they could not replicate 43 of the 67 published preclinical studies that the company had been relying on to develop cancer and cardiovascular treatments and diagnostics. In 2015, only about a third of 100 psychological studies published in three leading psychology journals could be adequately replicated.

A 2015 editorial in The Lancet observed that "much of the scientific literature, perhaps half, may simply be untrue." A 2015 British Academy of Medical Sciences report suggested that the false discovery rate in some areas of biomedicine could be as high as 69 percent. In an email exchange with me, the Stanford biostatistician John Ioannidis estimated that the non-replication rates in biomedical observational and preclinical studies could be as high as 90 percent.

Sarewitz also notes that 1,000 peer-reviewed and published breast cancer research studies turned out to be using a skin cancer cell line instead. Furthermore, when amyotrophic lateral sclerosis researchers tested more than 100 potential drugs reported to slow disease progression in mouse models, none were found to be beneficial when tested on the same mouse strains. A 2016 article suggested that fMRI brain imaging studies suffered from a 70 percent false positive rate. Sarewitz also notes that decades of nutritional dogma about the alleged health dangers of salt, fats, and red meat appears to be wrong.

And then there is the huge problem of epidemiology, which manufactures false positives by the hundreds of thousands. In the last decade of the 20th century, some 80,000 observational studies were published, but the numbers more than tripled to nearly 264,000 between 2001 and 2011. S. Stanley Young of the U.S. National Institute of Statistical Sciences has estimated that only 5 to 10 percent of those observational studies can be replicated. "Within a culture that pressures scientists to produce rather than discover, the outcome is a biased and impoverished science in which most published results are either unconfirmed genuine discoveries or unchallenged fallacies," four British neuroscientists bleakly concluded in a 2014 editorial for the journal AIMS Neuroscience.

Some alarmed researchers refer to this situation as the "reproducibility crisis," but Sarewitz convincingly argues that they are not getting to the real source of the rot. The problem starts with the notion, propounded in the MIT technologist Vannevar Bush's famous 1945 report Science: The Endless Frontier, that scientific progress "results from the free play of free intellects, working on subjects of their own choice, in the manner dictated by their curiosity for exploration of the unknown." Sarewitz calls this a "beautiful lie."

Why it is a lie? Because it makes "it easy to believe that scientific imagination gives birth to technological progress, when in reality technology sets the agenda for science, guiding it in its most productive directions and providing continual tests of its validity, progress, and value." He adds, "Technology keeps science honest." Basically, research detached from trying to solve well-defined problems spins off self-validating, career-enhancing publications like those breast cancer studies that actually were using skin cancer cells. Yet no patients were cured of breast cancer. The "truth test" of technology is the most certain way to tell if the knowledge allegedly being generated by research is valid. "The scientific phenomena must be real or the technologies would not work," Sarewitz explains.

Sarewitz points out that the military-industrial complex—the very force from which Vannevar Bush was eager to escape—generated the targeted scientific results that led to many of the technologies that have made the modern world possible, including digital computers, jet aircraft, cell phones, the internet, lasers, satellites, GPS, digital imagery, and nuclear and solar power. He's not suggesting that the Department of Defense should be in charge of scientific research. He's arguing that research should be aimed more directly at solving specific problems, as opposed to a system where researchers torture some cells and lab mice and then publish a dubious paper. An example of the kind of targeted scientific work he favors is the National Breast Cancer Coalition's Artemis project, whose goal is to develop an effective breast cancer vaccine by 2020.

"Academic science, especially, has become an onanistic enterprise worthy of Swift or Kafka," Sarewitz declares. He wants end-user constituencies—patient advocacy groups, environmental organizations, military planners—outside of academia to have a much bigger say in setting the goals for publicly funded research. "The questions you ask are likely to be very different if your end goal is to solve a concrete problem, rather than only to advance understanding," he argues. "That's why the symbiosis between science and technology is so powerful: the technology provides focus and discipline for the science."

And there's a bigger problem. In his 1972 essay "Science and Trans-Science," the physicist Alvin Weinberg noted that science is increasingly being asked to address such issues as the deleterious side effects of new technologies, or how to deal with social problems such as crime and poverty. These are questions that "though they are, epistemologically speaking, questions of fact and can be stated in the language of science, they are unanswerable by science; they transcend science." Such trans-scientific questions inevitably involve values, assumptions, and ideology. Consequently, attempting to answer trans-scientific questions, Weinberg wrote, "inevitably weaves back and forth across the boundary between what is known and what is not known and knowable."

"The great thing about trans-science is that you can keep on doing research," Sarewitz observes, "You can...create the sense that we're gaining knowledge...without getting any closer to a final or useful answer." Some contemporary trans-scientific questions: "Are biotech crops necessary to feed the world?" "Does exposure to synthetic chemicals deform penises?" "Do open markets benefit all countries?" "What will the costs of man-made global warming be in a century?" "What can be done about rising obesity rates?" "Does standardized testing improve educational outcomes?" All of these depend on debatable assumptions or are subject to confounders that make it impossible to be sure that the correlations uncovered are actually causal.

Consider climate change. "The vaunted scientific consensus around climate change," notes Sarewitz, "applies only to a narrow claim about the discernible human impact on global warming. The minute you get into questions about the rate and severity of future impacts, or the costs of and best pathways for addressing them, no semblance of consensus among experts remains." Nevertheless, climate "models spew out endless streams of trans-scientific facts that allow for claims and counterclaims, all apparently sanctioned by science, about how urgent the problem is and what needs to be done."

Vast numbers of papers have been published attempting to address these trans-scientific questions, Sarewitz observes. They provide anyone engaged in these debates with overabundant supplies of "peer-reviewed and thus culturally validated truths that can be selected and assembled in whatever ways are necessary to support the position and policy solution of your choice." It's confirmation bias all the way down.

The advent of big data also worries Sarewitz. Dredging massive new datasets generated by an already badly flawed research enterprise will produce huge numbers of meaningless correlations. Since the integrity of the output is dependent on the integrity of input, big data science risks generating a flood of instances of garbage in, garbage out, or GIGO. Sarewitz warns, "The scientific community and its supporters are now busily creating the infrastructure and the expectations that can make unreliability, knowledge chaos, and multiple conflicting truths the essence of science's legacy."

Ultimately, science can be rescued if researchers can be directed more toward solving real world problems rather than pursuing the beautiful lie. Sarewitz argues that in the future, the most valuable scientific institutions will be those that are held accountable and give scientists incentives to solve urgent concrete problems. The goal of such science will be to produce new useful technologies, not new useless studies. In the meantime, Sarewitz has made a strong case that contemporary "science isn't self-correcting, it's self-destructing."

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