"And I'll leave you with one set of numbers that I found today, which is just an absolute for this whole thing. In 2015, Wall Street Bonuses, not regular compensation, bonuses, seven years after they were bailed out with the public purse, totaled $29.4 billion dollars. Total compensation paid to every single person in this country who makes minimum wage totaled $14 billion...
The era of neo-liberalism is over. The era of neo-nationalism has just begun."
Mark Blyth
"Caesar was swimming in blood, Rome and the whole pagan world was mad. But those who had had enough of transgression and madness, those who were trampled upon, those whose lives were misery and oppression, all the weighed down, all the sad, all the unfortunate, came to hear the wonderful tidings of God, who out of love for men had given Himself to be crucified and redeem their sins.
When they found a God whom they could love, they had found that which the society of the time could not give any one— happiness and love."
Henryk Sienkiewicz, Quo Vadis: The Time of Nero
When historians look back on this period of the last forty years and diagnose what went wrong, they might do worse than to conclude that at the root of it was a general failure of character, from the top down.
The replacing of honor and duty with egoism and greed as the most honored of civic virtues was a long and slow process. It took root and was nurtured in a portion of the population that was served by it during the Reaganomics revolution, but eventually spread to those institutions and groups that had generally provided a bulwark for freedom and justice against the perennial amorality of the greedy.
Although they were certainly not the root cause of it, the Clintons played a prominent role in sealing the deal between the political and the financial class, and throwing the whole thing into a higher gear. They made political corruption, which heretofore had been hidden in the closets, fashionable.
Indeed, it may not be too much to say that they were to soft corruption in politics what Henry Ford was to automobile production. They certainly did not invent it, and were probably not the worst compared to some of their colleagues across the aisle, but they industrialized it, and knocked down the last bastions of public conscience in the process by showing how well greed could pay off while still maintaining some semblance of public respectability.
There will be a three day weekend in the US markets because of President's Day on Monday.
There was some surprisingly good 'soft' data this week in the Philly Fed and Empire Manufacturing reports. Let us see if those translate into good, hard economic numbers.
The crux of the problem is the huge imbalance between corporate power and the ability of worker's to achieve increasing wages. Without increasing wages, broader aggregate demand in the form of consumption cannot be sustained.
It was sustained during a long period of wage stagnation by innovative debt instruments associated with the housing bubble that was greatly encouraged by the financial sector and their servants in the political and professional classes. The fraud which they helped to perpetuate was conscious and pre-meditated. The crafted specific financial offerings towards that purpose.
However, in the aftermath of the housing bubble collapse, the ability and willingness of the average American to go into debt for ordinary consumption is reluctant to say the least. At least half the nation is living paycheck to paycheck with little to no savings.
This is not going to end well or easily as you might expect. However, the elites have been winning for so long, and are so full of themselves, and so firmly committed to their schemes that I think they will finally let the whole thing hit the wall in some way, and then make the people another deal that they cannot refuse, as they had done with the bank bailouts in 2008.
And that is where the right preparations and the willingness to do what is required of this generation will be most important.
No one ever said that it would be easy, or that we would be going to heaven on featherbeds.
The corruption in the system is becoming much more apparent. The extreme biases in the mainstream media in favor of their particular owner's faction is fairly obvious.
The liberal establishment, in their zeal to excuse themselves and their failure to support the working class, is embracing a kind of McCarthyism with an ease that is almost astonishing in its hypocrisy. The hypocrisy on display at MSNBC is almost as embarrassing as that on Fox News.
That the Wall Street Democrats brought their own political failure on themselves by their strong and enduring pivot to the wealthier urban professionals is something that escapes their consciousness.
And on the other hand, the Republican establishment is gone bananas in their service to greed. I figure if they are able to beat down Trump like the Democrats beat down Bernie, then we are in for a real reckoning.
This is nothing new. Indeed, this resembles the America of the past more than most people realize. Our education is slanted and poor, and our national self-image is a masterpiece of public relations.
The discussing of politics is 'fun' and avoids having to make comments on what is certainly a confusing period in American economics. I try to stay on that topic, especially since so few are actually shedding light on it these days. But truth be told, money and politics are often about power, and nevermore as in times of general corruption, when might makes right. Or at least policy that they call right.
This is the worst, most sluggish 'recovery' we have seen in modern times here. But since it has a bipartisan stamp, it is difficult for some to wrap their politically black and white heads around it.
And I hate to resort to it, but in historical terms what we are seeing is more like a 'class war' from ages long ago than any kind of financial new era. The moneyed class turned the law and the thought leaders framing to their own benefit, and would now do anything they can to keep their ill-gotten gains.
Wrap it up in a credibility trap and tie a bow around it, and here we are.
Have a pleasant weekend. See you on Tuesday.
