Tuesday, May 03, 2011

May Day 1971 and 2011

Forty years after massive demonstrations rocked Washington, D.C., the public is passive and complicit: do whatever it takes to keep my share of the swag flowing.

Forty years ago, hundreds of thousands of people took to the streets of Washington, D.C. to shut the city down. Their goal was to end the war in Vietnam.The National Guard was called out, and a huge melee ensued between the citizens who opposed the government's policies and the government itself, which viewed the citizens as impediments to its plans and ambitions.

Six weeks later, the 7,000-page secret history of the government's deceptions of its own citizenry, The Pentagon Papers, was published. The documents detailed how the Federal government and the nation's elected leaders had purposefully misled the public for decades about their goals, intentions and policies.

It made no difference. The war dragged on as the U.S. combat role was replaced by "Vietnamization" and wholesale bombing of Indochina. President Nixon won re-election by a landslide in 1972.

As many readers know, Nixon was dealing with the blowback of a "guns and butter" borrow-and-spend Federal policy which had lit the fires of incipient inflation. Sensing trouble, the stock market had topped in 1969. It would take 14 years to recover in nominal terms and even longer in real (inflation-adjusted) terms.

To inoculate itself from inflation, West Germany exited the Bretton Woods currency agreement that same May in 1971. In August of that year, Nixon imposed a 90-day wage and price freeze, a 10 percent import surcharge, and, most importantly, “closed the gold window”, ending convertibility between US dollars and gold.

This marked a new level of manipulation and intervention by the Central State in the post-war economy. Not coincidentally, real wages topped out about the same time as the stock market, in the 1969-1971 time-frame. Measured in purchasing power, i.e. the number of gallons of gasoline or loaves of bread an average worker could buy with one hour of labor, American workers have experienced a steady decline in the value of their labor for the past 40 years.

In 1971, the American people welcomed wage-and-price controls, surcharges and the inflation of the nation's currency. It was a short-sighted way to stabilize the Status Quo, as history would prove; inflation roared ahead, decimating stocks, bonds, savings and wages, until Federal Reserve Chairman Paul Volcker raised interest rates to 16% a decade later in 1981 to choke off runaway inflation.

Today, the nation pursues two hot wars launched under the same cloak of deception as the Vietnam War, and a policy of similarly masked financial manipulations and interventions by the Central State and the Federal Reserve. The number of classified documents has soared since the Pentagon Papers as the Central State seeks to hide all of its misdeeds and dodgy policies.

The Federal Reserve invoked the threat of financial calamity and national security it its failed bid to keep its 2008 machinations secret. Only recently has the public learned the nation's central bank devoted 70% of its interventions to "saving" foreign banks.

Once again, nobody cares. The public has forgotten about the wars in Iraq and Afghanistan; only the family and friends of those deployed there care. Bradley Manning, who allegedly released thousands of secret cables, sits forgotten in prison, awaiting a kangaroo-court trial for his crimes against the State's classified wars.

The 250,000 diplomatic cables released by WikiLeaks were embarrassing to various people and nations, but they were not a history of government deception like the Pentagon Papers; they were the daily chatter of Empire, interesting but not definitive.

The American public are quiet about everything but their own perquisities.Unprecedented global interventions and manipulations of the economy are accepted without comment, with the implicit faith that it's all justified as long as my personal perquisites of Empire keep flowing to me: the cheap gasoline, the cheap food, the retirement checks, the Medicare, the Medicaid, the fat government contracts, the tax breaks, and all the masking of risk and the cloaking of all the lies at the heart of the American financial system.

Just as in 1971, nobody cares about the deception at the very heart of the American government and economy. But the seeds sown by the mismanagement, the misdirection, the bogus statistics, the intentional cloaking of intentions and policies, the unprecedented interventions in the economy and financial system, and mostly saliently,the Central State-wide dependence on deception, has a price.

In the 1970s, the American public got exactly what it deserved. It was pleased to accept Central State lies and intervention as long as the crumbling sand castle continued to send out the checks and contracts.

Forty years later, we find ourselves in the same place, complacent about a reliance on fraud, deception and lies, complicit in our desire for the music to keep playing as long as we get our serving from the punchbowl and accepting massive intervention and manipulation as long as the Status Quo keeps supplying us with the perquisites of Empire.

But history is clear: it doesn't work that way. You can't lie your way to prosperity, any more than you can lie your way to honesty. You accept the fraud, you join the fraud. You accept the deception as policy, you join the deceivers.

There are a few voices calling for wholesale change, but in the main, the hue and the cry, the sound and the fury, are all about keeping the perquisites of Empire flowing. Just as in the last days of the Roman Empire, the Central State is pursuing a dual policy of increasing the number of days of free circus (by the end, almost half the year was devoted to circuses and entertainment for the masses, and roughly 40% of Rome's populace received free bread) while squeezing the remaining productive citizenry for additional taxes.

It was a doomed policy then and it remains doomed now.

The citizen who released the Pentagon Papers which essentially blew away the last pretense of an honest system of governance, Daniel Ellsberg, observed that the documents "demonstrated unconstitutional behavior by a succession of presidents, the violation of their oath and the violation of the oath of every one of their subordinates." He added that he leaked the Papers to end what he perceived to be "a wrongful war."

May Day, 1971 was marked by a vast public display of outrage and revulsion against an oppressive Central State which sought to protect itself and its minions from the public it was pledged to serve with an unstated government-wide policy of deception and lies.

May Day, 2011, the public is quiescent. Few care about anything but their share of the swag. There is a price to accepting deception in the flawed notion that it will serve you to remain quiet. We seem fated to re-learn that the hard way.

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