Bernie Sanders Says ‘Real’ Unemployment Rate Is Actually 10.5 Percent, DOUBLE The Official Rate [VIDEO]

While I give credit to Bernie Sanders for addressing the scope of problems related to our dependency on job creation as the ONLY source of income, as he evidences in the reality that REAL unemployment far exceeds the official stated level, Sanders remains oblivious to the non-job-dependent solution. Job creation is a function of economic growth, and without growth the problem of long-term unemployment and underemployment will persist. In turn, the diminishing impact income losses have on the long-term productive capacity of the United States economy will also persist.The common thread of writing and speeches that address unemployment and underemployment are solutions that are either temporary (such as infrastructure building and rebuilding) or solutions that would build an American society of dependent citizens on tax extraction and national debt to provide social insurance. While government job creation and social insurance are certainly emergency measures that require implementation, they should not be seen as a panacea.

The real task is to change the culture, from one of wanting or lacking personal responsibility and dependency on the “State,” into one where our human nature can be sustained and advanced through a private property ownership mentality, pursuing individual virtue. We need to transform the present credo, as advocated by progressive political leaders and others from one of servitude and dependency to one of personal responsibility and sustainability by means of broadening wealth creating, income-producing private property ownership by EVERY citizen of the productive capital (non-human) means of production. Private property ownership is the cornerstone of American liberty. Without it our free enterprise system, our free markets, and our republican form of self-government cannot endure. Nor can we prosper without the equal opportunity to acquire capital ownership financed by its own earnings. We need to pursue policies that will strengthen the economic position of the individual, the family, and the local community with decreasing reliance on government welfare support financed by tax extraction and national debt.

As well, with every taxpayer-supported government contract there needs to be the stipulation that to apply and be awarded government contracts, loan guarantees, grants, etc., the corporations applying must be employee-owned and payout fully the earnings dividends to their owners, thus reframing from using retained earnings and debt financing, neither of which creates any new capital owners.

While emergency assistance is necessary in the interim, Bernie Sanders is trapped in the thinking of  ALL one-factor production: LABOR ONLY!––with a focus on wages rather than income, and “full employment” rather than “full production” as the economy’s panacea. Sanders and others are ALL stuck in the LABOR ONLY idea that ALL WEALTH is created by human labor. The reality is that less and less human labor is necessary to produce wealth. If that is the case, then ownership of the non-human means of production is necessary if one desires to be wealthy and affluent. Ownership is the key to providing sufficient income purchasing power, not JOBS alone.

The political maneuvering in Washington is directed at benefiting the wealthy capital ownership class, not the average person on “Main Street.” Such policies as are pursued will further concentrate ownership of wealth-creating, income-producing productive capital assets among the 1 to 5 percent of the American population and further enhance the economic and political power of the wealthy ownership class.

The root cause of present injustices is the fact that the mass of people are practically bereft of ownership of wealth-creating, income producing productive capital. Policy objectives need to result in universally admitting the proletariats within the proprietary system. Widely distributed property ownership makes for social stability. All the solutions offered by Bernie Sanders lack the moral discipline of responsibility and ownership, and instead lead to a collective “State” approach to replace our private property-based American system.

No longer is the American economy labor-intensive with opportunity for jobs that strengthen the middle class. The new challenge is structuring the economy to empower EVERY citizen to benefit from technological advancement as tectonic shifts in the technologies of production and globalization of production destroy jobs and devalue the worth of labor. Technological change makes tools, machines, structures, and processes ever more productive while leaving human productiveness largely unchanged (our human abilities are limited by physical strength and brain power––and relatively constant). The technology industry is always changing, evolving and innovating. As a result, the trend has been to diminish the importance of employment with productive capital ownership concentrating faster than ever, while technological change makes capital ever more productive. Bottom line: technology is an easier and faster way to get a job done.

Because technology increases the profitability of companies throughout the world, technology always has the advantage over human labor when the costs of them are the same. Digital automated systems now replace many middle management and many manual jobs. At some point the traditional jobs at the bottom of the economic pyramid paying low wages will become automated. This will result in more and more people chasing fewer and fewer jobs. At some point the issue of earning a living will become problematic for the American economy and those contributors and their references will have to address the issue of concentrated ownership as productive capital will obviate most jobs as we know them to be now.

Sadly, the system is rigged by the wealthy ownership class to manipulate the lives of people who struggle with declining labor worker earnings and job opportunities, and then accumulate the bulk of the money through monopolized productive capital ownership. Our scientists, engineers, and executive managers who are not owners themselves, except for those in the highest employed positions, are encouraged to work to destroy employment by making the capital “worker” owner more productive. How much employment can be destroyed by substituting machines for people is a measure of their success––always focused on producing at the lowest cost. Only the people who already own productive capital are the beneficiaries of their work, as they systematically concentrate more and more capital ownership in their stationary 1 to 5 percent ranks.

The reality is that personal and family household income for those who are dependent on a job as their ONLY income source is declining. Wage and salary incomes, despite efforts to raise the minimum wage, will continue to decline simultaneously with global competition and, as a result of the necessity to turn to increasingly more productive non-human means of production, destroy jobs that will become unnecessary and devalue the worth of labor.

Full employment is not an objective of businesses. Companies strive to keep labor input and other costs at a minimum in order to maximize profits for the owners. Private sector job creation in numbers that match the pool of people willing and able to work is constantly being eroded by physical productive capital’s ever increasing role. This will not change with companies realizing that they can operate more efficiently with fewer employees. Therefore, unless the employees are owners, the share of corporate profits going to the employees will continue to decline.

But because this is not well understood, what we as a society have been doing is to continually shift the work burden from human labor to real capital while distributing the earning capacity of capital “workers” (via capital ownership of stock in corporations) to non-owners through jobs and welfare. Such policies do not function effectively.

Thus, the primary distribution through the free market economy, whose distributive principle is “to each according to his production,” delivers progressively more market-sourced income to capital owners and progressively less to workers who make their contribution through labor.

Unfortunately, ever since the 1946 passage of the Full Employment Act, economists and politicians formulating national economic policy have beguiled us into believing that economic power is democratically distributed if we have full employment––thus the political focus on job creation and redistribution of wealth rather than on full production and broader capital ownership accumulation. This is manifested in the belief that labor work is the ONLY way to participate in production and earn income even though EVERY wealthy person and family knows that capital incomes can be far greater than wage incomes. Long ago labor work was prime because labor provided 95 percent of the input into the production of products and services. But today that is not true. Capital provides not less than 90 to 95 percent of the input. Full employment as the means to distribute income is not achievable. When capital “workers” (productive capital owners) replace labor workers (non-capital owners) as the principal suppliers of products and services, labor employment alone becomes inadequate. Thus, we are left with government policies that redistribute income in one form or another including unemployment benefits and other social insurance programs.

Conventional economists, political leaders and the national media are oblivious to the structural problems that plague our economy, especially with respect to the ways the system further concentrates ownership of wealth-creating, income-producing productive capital assets and growth among the already wealthy ownership class, which represents 1 to 5 percent of the population. With such concentrated economic power, the American majority is barred from participating in the ownership of the non-human factor assets that are doing the bulk of the production of products and services, leaving them with their ONLY income source a job or welfare. Thus they are shut out from a most significant income source to effectively empower them to be “customers with money” and propel economic demand, and thus real productive growth of the economy.

There is a way out if the Federal Reserve System can be reformed to act as a purveyor of economic growth.

Right now the Federal Reserve creates money by loaning it to banks, who re-loan it multiple times because of fractional banking rules. With Capital Homesteading ( and, money would be created by loaning it directly to citizens using insured capital credit loans via banks at near-zero interest to invest in FUTURE wealth-creating, income-generating (full dividend payout) productive capital assets formed by producer companies. To build real wealth and also phase out our near-defunct social security scheme, the new full-reserve money would go into a long-term retirement account (a super IRA) to be invested in dividend-paying, asset-backed shares of diversified corporations. That way, money power would be spread to all citizens. The middle class would be invigorated using the principle of compounding interest, instead of being decimated by mushrooming public and personal debt.

In this way, the Federal Reserve could play a more positive role, removing artificial barriers to equal citizen access to acquiring and owning productive capital wealth. By creating asset-backed money for production, supported by growth-oriented tax policies, the Federal Reserve could truly help promote shared prosperity in a market system.

Wealth creation needs to benefit EVERY citizen. Virtually all the economic gains have pertained to the wealthy ownership class within the top 1 to 5 percent of the population, as Bernie Sanders correctly points out, who own the vast wealth-creating, income-generating productive capital assets of American corporations.

Unless we reform the system, economic inequality will expand and the American people will experience far greater competition globally as teams of people and machines compete to produce and sell their products and services at the lowest possible cost. This means that we must look to increasing the productiveness of technological innovation and invention.

The reality is that more and more people are being squeezed financially, faced with dismal job prospects (their only source of income) and on the blink of having to turn to the government for unemployment benefits, welfare support and other social insurance programs funded by tax extraction and national debt. Americans, for the most part, are in a mode of retrenchment even though they have tremendous pent-up demand and unfulfilled dreams for a more affluent life, which they see enjoyed by the wealthy ownership class (without realizing that those people are wealthy because they OWN).

Sanders Asks Obama To Close Six Egregious Corporate Tax Loopholes

On March 3, 2015, Bernie Sanders writes on his Web page:

Sen. Bernie Sanders (I-Vt.), the ranking member of the Senate Budget Committee, said President Obama could act on his own to raise over $100 billion over a decade by closing the worst corporate tax loopholes.

Sanders identified several actions that the White House could take to prevent corporations from using offshore tax havens and other tax dodges and to prevent wealthy individuals from avoiding income and estate taxes.

“Since the Republican-led Congress has refused to raise revenue by asking the most profitable corporations to pay their fair share, I would hope that the president could take executive action to remedy some of the most egregious loopholes,” Sanders said. “We have got to demand that companies like Apple, Hewlett-Packard, and General Electric stop engaging in legalized tax fraud that limits our ability to invest in the future.”

“At a time when this country has a $18 trillion national debt and a huge amount of infrastructure and social needs it is absurd that major profitable corporations pay nothing in federal taxes,” added Sanders, who last week issued a new detailed report on the extent of offshore tax havens by major American companies that have been most engaged in lobbying for new tax breaks and cuts to important programs for middle class families, such as Social Security, Medicare and Medicaid.

The six tax breaks that Sanders wants Obama and Treasury Secretary Jack Lew to eliminate are:

  • The check-the-box loophole allows multinational companies to characterize their offshore subsidiaries in different ways to different governments so that their profits are untaxed.

  • The Hewlett-Packard loophole allows American corporations to use short-term loans from their subsidiaries circumvent the requirement that they pay U.S. taxes on their offshore profits when those profits are brought to the U.S.

  • The corporate inversions loophole allows an American corporation to merge with a (usually much smaller) foreign corporation and then reincorporate as a foreign company to avoid U.S. taxes even as it continues to operate and be managed in the U.S.

  • The carried interest loophole allows hedge fund managers to characterize their compensation (which they earn for managing other people’s money) as capital gains, which is subject to lower personal income tax rates than other types of income. Tax experts have pointed out that the Treasury Department has the authority under existing law to determine how this income is taxed.

  • Valuation discounts are restrictions placed on small business property given to family members (to keep the business in the family, for example) which are often meaningless but are claimed to dramatically reduce their value for estate and gift tax purposes.

  • The real estate investment trust (REIT) loophole allows private prisons, billboard companies, casinos and other companies claim that they are making money from rents to avoid paying the corporate income tax.

These are necessary actions as part of a greater policy of eliminating ALL tax loopholes and subsidies. But, of course, President Obama has not acted on one single tax loophole closure.

Bernie Sanders Hints At What A Sanders Administration Cabinet Could Look Like


On July 5, 2015, Christina Wilkie writes on The Huffington Post:

Democratic presidential candidate and Vermont Sen. Bernie Sanders (I) offered a first glimpse on Sunday of some of the people he might consider for his cabinet in a potential Sanders administration, and a few that he certainly won’t.

“My cabinet would not be dominated by representatives of Wall Street,” Sanders said on CNN’s “State of the Union.” “I think Wall Street’s played a horrendous role in recent years, in negatively impacting our economy and in making the rich richer. There are a lot of great public servants out there, great economists who for years have been standing up for the middle class and the working families of this country.”

Prompted by host Jake Tapper, Sanders went on to praise Paul Krugman, the New York Times columnist and Nobel Prize-winning economist. Krugman is a vocal opponent of tax cuts for the rich, and he has warned readers for years about the dangers of income inequality. “Krugman does a great job,” Sanders said.

Also doing a great job, Sanders said, is Columbia University economics professor and Nobel laureate Joseph Stiglitz, whose recent work has focused on the perils of radical free markets, such as those espoused by some in the libertarian wing of the GOP.

Sanders also singled out Robert Reich, the former labor secretary under President Bill Clinton, now a professor at the University of California at Berkeley: “I think [he] is doing a fantastic job.” Reich has long been an influential backer of labor unions, which have come under attack from Republican governors in recent years.

Still, Sanders said, “it’s a little bit too early, I must say, to be appointing a cabinet. Let me get elected first.”

In recent weeks, Sanders’ long shot campaign for the Democratic nomination has captured a swell of momentum on the left, drawing larger crowds in Iowa than Hillary Clinton, the presumed Democratic front-runner.

“All over this country, younger people, working people, elderly people, are moving in our direction, because they want a candidate to take on the establishment,” Sanders said.

Unfortunately, the three potential cabinet consideration in the Bernie Sanders administration are ALL one-factor thinkers––that laboring through a job is the ONLY means to earn an income. Their entire history of activism has been focused on job creation, without realizing that there first must be OWNERSHIP creation simultaneously with growth of the economy. The three men mentioned are conventional economic thinkers with no new, viable solutions to abate wealth and income inequality.

None of these economist recognize, nor does Bernie Sanders, that there are far more effective ways to empower EVERY citizen to earn more money to create demand for economic growth. We need to get Bernie Sanders to see the REAL solution to wealth and income inequality, which is to empower EVERY citizen to become an OWNER of wealth-creating, income-producing non-human capital assets, the result of technological invention and innovation, and the REAL cause of productivity gains. Those who OWN the non-human means of production are the beneficiaries of the wealth and income produced by shifts in the technologies of production resulting in increased productivity.

One of the principal legislative policies that will require adoption is the proposed Capital Homestead Act (CHA) (See and See and…/uploads/Free/capitalhomesteading-s.pdf.)

The immediate effects of the CHA should be felt within 18 to 24 months — but not because of the dividends earned by the new capital OWNERS, but the effect on “job creation.”

This is because forming a couple trillion dollars worth of new productive capital assets will result in new jobs, which will trigger new demand as workers spend their income, and thus more jobs to meet the new demand. The direct effects of the CHA will be felt within 7 to 9 years . . . the length of time (estimated) needed to repay the first round of new capital investment completely and apply the full stream of dividends to consumption instead of debt service . . . which will create yet more demand and thus result in more job creation.

Cautiously we can assume that the first year of the Capital Homesteading program will focus first on the enormous number of projects that must be undertaken regardless of the cost of financing. This appears to be around $2 trillion. (Strictly speaking, Capital Homesteading “pure credit” financing would be interest-free, although not cost-free — but that’s a technicality we don’t need to address in this comment.)

Following this would be those projects that have been in abeyance due solely to lack of available financing at a reasonable cost. We could consider this “additional investment” — but is it really? Let’s assume it is, since it’s above the bare minimum. There are no solid figures for this, but let’s assume that it’s roughly half of the amount of the “must be undertaken” projects, or $1 trillion. Just to be ultra-conservative, let’s include in that replacement capital that managers have realized will be cheaper financed with pure credit and the cash earning they’ve been retaining for replacement that rightfully belongs to the shareholders can be paid out to the shareholders.

Thus, hypothetically, the additional new capital increment would increase the amount of new capital formation from $2 to $3 trillion.

As one can see, the economic benefits of a Capital Homesteading program would begin immediately, as soon as the workers forming the new capital get paid. Once the initial loans are paid back, there would be another infusion of consumption income into the economy due to freeing up cash formerly used for debt service. This would increase by the same amount every year, everything else being equal.

All the loans would have to be paid back, in full, for the system to work, with capital credit insurance and reinsurance to repay the loans for failed projects. As for working capital and R&D — those are, technically, a capital item and an expense, respectively. If more cash is needed for operations, the company should issue new shares, not retain earnings. By issuing and selling new shares of stock in the corporations growing the economy, we can broadly create new capital owners with the effect of vastly spreading the new wealth created.

While Bernie Sanders is proving to be a justice-committed leader, especially one who wants to end the corruption built into our exclusionary system of monopoly capitalism––the main source of corruption of any political system, democratic or otherwise he is weak on solutions to reform the system. He needs to advocate the need to radically overhaul the Federal tax system and monetary policies and institute proposals to get money power to the 99 percent of American citizens who now only rely on their labor worker earnings. But I want him to advocate the Just Third Way’s more just and simple tax system, under which access to ownership of the means of production in the future would by provided to every child, woman and man by requiring the government to lift all existing legal and institutional barriers to private property stakes as a fundamental human right. The system was made by people and can be changed by people. Guided by the right principles of economic justice, “we the people” can organize and demand that the system be reorganized to make true economic democracy the new foundation for true political democracy. The result of this movement of new justice-committed leaders and activists will be inclusive prosperity, inclusive opportunity, and inclusive economic justice.

Support the Agenda of The Just Third Way Movement at,, and


So About That Whole Tech-Eating-Jobs Thing

On July 4, 2015, Jon Evans writes on TechCrunch:

The argument seems compelling, the logic inescapable. As hardware doubles its density every 18-24 months, courtesy of Moore’s Law, and as software eats the world, technology willreplace a broad swathe of jobs outright–from burger-flippers to diagnosticians–and atomize many others from full-time positions into gigs performed by many fungible workers. Tech, in short, will eat jobs.

Oh, it will create new jobs too, obviously. But it seems flagrantly apparent that technology moves faster than society these days, and hence it seems very likely that technology will destroy jobs faster than it creates them. What’s more, those jobs it creates will tend to be in fields that emphasize human creativity–ie “tournament” fields with a few winners and many losers.

All of which would be a good thing–as most jobs are crap jobs–except that our society is not built for a world in which more and more people are unemployed. Not unless we implement something like a basic income.

…That’s the argument, at any rate. It’s one I’ve made repeatedly in this space over the last few years. (Echoing many others, to be clear.) But intellectual honesty compels me to admit: the available evidence does not currently support it at all.

If the USA is the canary in our global coal mine–which seems likely, given its high technology and liberal labor laws–then the workers of the world have little to worry about any time soon. “Robots Seem to Be Improving Productivity, Not Costing Jobs,” reports the Harvard Business Review. Total nonfarm payroll employment is far above where it was ten years ago:

Even the age-adjusted employment-to-population ratio has, crucially, recovered almost two-thirds of its Great Recession losses. The trend is obvious. Yes, the tech-eating-jobs argument still seems to hold logical water. Yes, this may be a sharp cyclical rise masking a gradual structural decline. But right now the evidence indicates that “tech is eating jobs!” is vaporware at best. Opinions are interesting, but evidence is what matters.

This evidence is arguably a bad thing–no, really–because, again, tech eating jobs is anoptimistic future … assuming we figure out a new tech-driven socioeconomic structure that shares machine-generated wealth in a decentralized way that still incentivizes productivity and creativity. But it’s also a good thing, because, realistically, as a society, we’re not very good at that sort of restructuring. (Cf my favorite Winston Churchill quote.)

Really we’re not even good at understanding the problem. Consider Derek Thompson’s long, puzzling piece “A World Without Work” in The Atlantic. He doesn’t seem to get that the point of a basic income is to supplement jobs and tide people over through periods of unemployment, not replace work entirely; and, as Mike Konczal points out, Thompson doesn’t really address either the wrenching transition to such a world, or the vicious inequality that it might feature–arguably the topic’s two most important problems.

It seems that we face one of five futures:

  1. Tech eats many/most jobs entirely. Could be Star Trek, if we reshape our society to fit. Could also very easily be a world of a small, very wealthy rich minority; a barely larger middle class; and a vast impoverished underclass precariat. (Americans tend to think, wrongly, that such a society would be unstable and soon overthrown by revolution. In fact much/most of the world is already structured this way and has been for many years.)
  2. Tech atomizes jobs into gigs, and/or creates new tournament-style Extremistan jobs. Not especially phenomonologically distinct from option 1.
  3. Tech creates great, or at least better, new jobs for everyone. This would be pretty good! Not as idyllic as a future where work is completely optional as long as you accept a low (but survivable) standard of living, but pretty good. A minority of people in today’s world have enjoyable jobs that both challenge and reward them. (I’m one of them.) People who are high-profile, or have high-profile soapboxes, are more likely to be among this cohort … so, I suspect, they think it’s a more likely future than it actually is. But it’s at leastplausible.
  4. Global catastrophe, and/or the Singularity, or something else that makes all this irrelevant.
  5. Something much, much weirder.

I actually think Option 5, the “unknown unknown,” is quite likely–but it’s a moot point. The available evidence, to my surprise, is currently pointing towards Option 3. Which is not what I predicted, and is no bad thing at all.

But in ten years’ time? Or even five years’ time?

No one can say for sure, but it seems to me that we collectively face a variant of Pascal’s Wager. It seems to me that it would do us a lot of good, and no harm at all, to at least prepare for the possibility of Option 1 and/or Option 2 — especially now that we have some breathing room.

That’s why I’m watching the increasing experimentation with basic incomes around the world with great interest. True, if jobs keep being created faster than technology destroys them, we may not need that at all. But let’s not put all our eggs in that basket just yet. Moore’s Law, and human ingenuity, are relentless and implacable forces.


5 Obvious Pieces Of Evidence That NAFTA Is Killing The U.S. Economy


On May 1, 2015, Daniel Mills writes on Economy In Crisis:

When NAFTA (North American Free Trade Agreement) was passed, many people feared the worst. The results have indeed been disastrous. Just look at the results:

  1. The trade deficit with Mexico has exploded
  2. Mexican wages remain nearly as low as they were prior to NAFTA and are still a small fraction of our average wages
  3. Wealth and power has not filtered to the people. Most of Mexico is still controlled by less than 100 corporations
  4. Many of our other trading partners have relocated facilities to Mexico to circumvent other trade agreements with the U.S.
  5. American manufacturing has lost 3 million jobs in the past 10 years as U.S. companies have also moved to Mexico for lower wages and lax regulations

On the basis of the one-sided disastrous results over the past 15 years, whoever advocated NAFTA seems to be either grossly negligent of their duty of representing their constituents or is simply working contrary to the best interests of this country.

The evidence was clear that NAFTA would be a disaster.

Imagine if Congress decided that a single state, such as California or Michigan, was in desperate need of jobs and investment and made dramatic changes to boost that state’s economy.

Imagine Congress did the following for only that one American state:

  • Dropped the minimum wage to $3 per hour
  • Exempted them from child labor laws
  • Expanded the work week
  • Reduced health and work place safety laws
  • Banned unions
  • Reduced protection for the environment

On top of this, the companies residing in this state would still have tariff and duty-free access to all of the others states. In other words, companies in this state could produce at a fraction of the cost of other states, yet would be able to sell directly to all other 49 states and compete at no additional cost.

What would you think of that? You and the other 49 states might agree that this was absolutely ridiculous!

But this is exactly what is happening right now with NAFTA and other “free” trade agreements, like the KORUS FTA (Korean.S. Free Trade Agreement). Not with California or Michigan, but with Mexico and Canada from the time NAFTA was passed. Why would any company manufacture in the U.S. now when it can produce next-door in Mexico with all these unfair advantages?

Because of disastrous free trade agreements like NAFTA and the KORUS FTA, our productive factories are shutting down. Millions of jobs are disappearing. Enrollment on programs like food stamps is exploding. Poverty is becoming an epidemic.

Our government allows outsourcers to ship our jobs overseas, which results in millions of dollars in profits for them, while our middle class erodes.

The quickest solution is to penalize outsourcing, establish tariffs and incentivize production. We can either do this—or enact similar changes—or the millions of our jobless will soon storm out of their homeless shelters and take to the streets to demand new elections, to select leaders who can actually lift them and the rest of the nation out of poverty and starvation.

We MUST get out of NAFTA now!


One Of The Wealthiest People On Earth Just Announced He’s Giving All His Money To Charity.

On July 3, 2015, Robbie Couch writes on Unworthy:

This is Prince Alwaleed bin Talal. He’s CRAZY rich. Like, wealthier-than-the-entire-country-of-Paraguay rich.

But don’t fret. He’s great, I promise. Read on…

Here he is at a press conference July 1, 2015, where he announced he’s doing something awesome with all his money. Image by Fayez Nureldine/AFP/Getty Images.

He’s the 60-year-old nephew of Saudi Arabia’s royal leader, King Salman. And he has $32 billion.

In case you’re wondering, Forbes pegs him as the 34th wealthiest human on the planet.

But before you get upset with Alwaleed and pull an Anne Hathaway because you don’t have $32 billion…

We feel you, Anne. GIF via “Love & Other Drugs.”

you should know Alwaleed uses a good chunk of his change to make the world a better place.

The prince has given billions of dollars to various philanthropic efforts. His foundation has supported projects in 92 countries around the globe!

And this week, he just stepped up his charity game even more.

On July 1, 2015, Alwaleed announced he’s giving away his entire $32 billion fortune to charity.

Every. Last. Penny.

His gargantuan gift will go to his own nonprofit, Alwaleed Philanthropies, throughout the next several years. There, the dollars will bolster a handful of causes worldwide, likeempowering women, eradicating diseases, assisting in disaster relief, ending poverty, increasing intercultural understanding, developing underserved communities … shall I go on? Because there’s more.

Here’s his two cents on the matter:

Image via Fayez Nureldine/AFP/Getty Images.

As if he needed us to like him even more, the prince noted his decision was inspired by the one, the only, Mr. Bill Gates.

Alwaleed said the Bill & Melinda Gates Foundation, which launched about 15 years ago to do things like help kids be able to attend school and fight preventable diseases,prompted him to empty his wallet for good.

Gates called Alwaleed’s move “an inspiration to all of us working in philanthropy around the world.”

Bill Gates being awesome in Paris, France, in June 2015. Image via Bertrand Guay/AFP/Getty Images.

So, an important lesson to all those who can afford to lend a helping hand:

Be awesome like Prince Alwaleed. He’s living proof the world needs more big hearts — not big bank accounts.

In this spirit, ALL wealthy people should support the proposed Capital Homestead Act ( and See and…/uploads/Free/capitalhomesteading-s.pdf). A provision of this Act is as a substitute for inheritance and gift taxes, a transfer tax would be imposed on the recipients whose holdings exceeded $1 million, thus encouraging the super-rich to spread out their monopoly-sized estates to all members of their family, friends, servants and workers who helped create their fortunes, teachers, health workers, police, other public servants, military veterans, artists, the poor and the disabled.

A Revolutionary Pope Calls For Rethinking The Outdated Criteria That Rule The World

The Revolutionary Pope by

On July 4, 2015, Ellen Brown writes on OptEd News:

Pope Francis’ revolutionary encyclical addresses not just climate change but the banking crisis. Interestingly, the solution to that crisis may have been modeled in the Middle Ages by Franciscan monks following the Saint from whom the Pope took his name.


Pope Francis has been called “the revolutionary Pope.” Before he became Pope Francis, he was a Jesuit Cardinal in Argentina named Jorge Mario Bergoglio, the son of a rail worker. Moments after his election, he made history by taking on the name Francis, after Saint Francis of Assisi, the leader of a rival order known to have shunned wealth to live in poverty.

Pope Francis’ June 2015 encyclical is called “Praised Be,” a title based on an ancient song attributed to St. Francis. Most papal encyclicals are addressed only to Roman Catholics, but this one is addressed to the world. And while its main focus is considered to be climate change, its 184 pages cover much more than that. Among other sweeping reforms, it calls for a radical overhaul of the banking system. It states in Section IV:

Today, in view of the common good, there is urgent need for politics and economics to enter into a frank dialogue in the service of life, especially human life. Saving banks at any cost, making the public pay the price, forgoing a firm commitment to reviewing and reforming the entire system, only reaffirms the absolute power of a financial system, a power which has no future and will only give rise to new crises after a slow, costly and only apparent recovery. The financial crisis of 2007-08 provided an opportunity to develop a new economy, more attentive to ethical principles, and new ways of regulating speculative financial practices and virtual wealth. But the response to the crisis did not include rethinking the outdated criteria which continue to rule the world.

. . . A strategy for real change calls for rethinking processes in their entirety, for it is not enough to include a few superficial ecological considerations while failing to question the logic which underlies present-day culture.

“Rethinking the outdated criteria which continue to rule the world” is a call to revolution, one that is necessary if the planet and its people are to survive and thrive. Beyond a change in our thinking, we need a strategy for eliminating the financial parasite that is keeping us trapped in a prison of scarcity and debt.

Interestingly, the model for that strategy may have been created by the Order of the Saint from whom the Pope took his name. Medieval Franciscan monks, defying their conservative rival orders, evolved an alternative public banking model to serve the poor at a time when they were being exploited with exorbitant interest rates.

In the Middle Ages, the financial parasite draining the people of their assets and livelihoods was understood to be “usury” — charging rent for the use of money. Lending money at interest was forbidden to Christians, as a breach of the prohibition on usury proclaimed by Jesus in Luke 6:33. But there was a serious shortage of the precious metal coins that were the official medium of exchange, creating a need to expand the money supply with loans on credit.

An exception was therefore made to the proscription against usury for the Jews, whose Scriptures forbade usury only to “brothers” (meaning other Jews). This gave them a virtual monopoly on lending, however, allowing them to charge excessively high rates because there were no competitors. Interest sometimes went as high as 60 percent.

These rates were particularly devastating to the poor. To remedy the situation, Franciscan monks, defying the prohibitions of the Dominicans and Augustinians, formed charitable pawnshops called montes pietatus (pious or non-speculative collections of funds). These shops lent at low or no interest on the security of valuables left with the institution.

The first true mons pietatis made loans that were interest-free. Unfortunately, it went broke in the process. Expenses were to come out of the original capital investment; but that left no money to run the bank, and it eventually had to close.

Franciscan monks then established montes pietatis in Italy that lent at low rates of interest. They did not seek to make a profit on their loans. But they faced bitter opposition, not only from their banking competitors but from other theologians. It was not until 1515 that the montes were officially declared to be meritorious.

After that, they spread rapidly in Italy and other European countries. They soon evolved into banks, which were public in nature and served public and charitable purposes. This public bank tradition became the modern European tradition of public, cooperative and savings banks. It is particularly strong today in the municipal banks of Germany called Sparkassen.

The public banking concept at the heart of the Sparkassen was explored in the 18th century by the Irish philosopher Bishop George Berkeley, in a treatise called The Plan of a National Bank. Berkeley visited America and his work was studied by Benjamin Franklin, who popularized the public banking model in colonial Pennsylvania. In the US today, the model is exemplified in the state-owned Bank of North Dakota.

Pope Francis’ revolutionary encyclical addresses not just climate change but the banking crisis. Interestingly, the solution to that crisis may have been modeled in the Middle Ages by Franciscan monks following the Saint from whom the Pope took his name.

Pope Francis has been called “the revolutionary Pope.” Before he became Pope Francis, he was a Jesuit Cardinal in Argentina named Jorge Mario Bergoglio, the son of a rail worker. Moments after his election, he made history by taking on the name Francis, after Saint Francis of Assisi, the leader of a rival order known to have shunned wealth to live in poverty.

Pope Francis’ June 2015 encyclical is called “Praised Be,” a title based on an ancient song attributed to St. Francis. Most papal encyclicals are addressed only to Roman Catholics, but this one is addressed to the world. And while its main focus is considered to be climate change, its 184 pages cover much more than that. Among other sweeping reforms, it calls for a radical overhaul of the banking system. It states in Section IV:

Reaganomics Killed America’s Middle Class

Reaganomics killed America's middle classEnlargeRonald Reagan (Credit: AP/Doug Mills)

On April 19, 2015, Thom Hartmann writes on Salon and AlterNet:

There’s nothing “normal” about having a middle class. Having a middle class is a choice that a society has to make, and it’s a choice we need to make again in this generation, if we want to stop the destruction of the remnants of the last generation’s middle class.

Despite what you might read in the Wall Street Journal or see on Fox News, capitalism is not an economic system that produces a middle class. In fact, if left to its own devices, capitalism tends towards vast levels of inequality and monopoly. The natural and most stable state of capitalism actually looks a lot like the Victorian England depicted in Charles Dickens’ novels.

At the top there is a very small class of superrich. Below them, there is a slightly larger, but still very small, “middle” class of professionals and mercantilists – doctor, lawyers, shop-owners – who help keep things running for the superrich and supply the working poor with their needs. And at the very bottom there is the great mass of people – typically over 90 percent of the population – who make up the working poor. They have no wealth – in fact they’re typically in debt most of their lives – and can barely survive on what little money they make.

So, for average working people, there is no such thing as a middle class in “normal” capitalism. Wealth accumulates at the very top among the elites, not among everyday working people. Inequality is the default option.

You can see this trend today in America. When we had heavily regulated and taxed capitalism in the post-war era, the largest employer in America was General Motors, and they paid working people what would be, in today’s dollars, about $50 an hour with benefits. Reagan began deregulating and cutting taxes on capitalism in 1981, and today, with more classical “raw capitalism,” what we call “Reaganomics,” or “supply side economics,” our nation’s largest employer is WalMart and they pay around $10 an hour.

This is how quickly capitalism reorients itself when the brakes of regulation and taxes are removed – this huge change was done in less than 35 years.

The only ways a working-class “middle class” can come about in a capitalist society are by massive social upheaval – a middle class emerged after the Black Plague in Europe in the 14th century – or by heavily taxing the rich.

French economist Thomas Piketty has talked about this at great length in his groundbreaking new book, Capital in the Twenty-First Century. He argues that the middle class that came about in Western Europe and the United States during the mid-twentieth was the direct result of a peculiar set of historical events.

According to Piketty, the post-World War II middle class was created by two major things: the destruction of European inherited wealth during the war and higher taxes on the rich, most of which were rationalized by the war. This brought wealth and income at the top down, and raised working people up into a middle class.

Piketty is right, especially about the importance of high marginal tax rates and inheritance taxes being necessary for the creation of a middle class that includes working-class people. Progressive taxation, when done correctly, pushes wages down to working people and reduces the incentives for the very rich to pillage their companies or rip off their workers. After all, why take another billion when 91 percent of it just going to be paid in taxes?

This is the main reason why, when GM was our largest employer and our working class were also in the middle class, CEOs only took home 30 times what working people did. The top tax rate for all the time America’s middle class was created was between 74 and 91 percent. Until, of course, Reagan dropped it to 28 percent and working people moved from the middle class to becoming the working poor.

Other policies, like protective tariffs and strong labor laws also help build a middle class, but progressive taxation is the most important because it is the most direct way to transfer money from the rich to the working poor, and to create a disincentive to theft or monopoly by those at the top.

History shows how important high taxes on the rich are for creating a strong middle class.

If you compare a chart showing the historical top income tax rate over the course of the twentieth century with a chart of income inequality in the United States over roughly the same time period, you’ll see that the period with the highest taxes on the rich – the period between the Roosevelt and Reagan administrations – was also the period with the lowest levels of economic inequality.

You’ll also notice that since marginal tax rates started to plummet during the Reagan years, income inequality has skyrocketed.

Even more striking, during those same 33 years since Reagan took office and started cutting taxes on the rich, income levels for the top 1 percent have ballooned while income levels for everyone else have stayed pretty much flat.

Coincidence? I think not.

Creating a middle class is always a choice, and by embracing Reaganomics and cutting taxes on the rich, we decided back in 1980 not to have a middle class within a generation or two. George H.W. Bush saw this, and correctly called it “Voodoo Economics.” And we’re still in the era of Reaganomics – as President Obama recently pointed out, Reagan was a successful revolutionary.

This, of course, is exactly what conservatives always push for. When wealth is spread more equally among all parts of society, people start to expect more from society and start demanding more rights. That leads to social instability, which is feared and hated by conservatives, even though revolutionaries and liberals like Thomas Jefferson welcome it.

And, as Kirk and Buckley predicted back in the 1950s, this is exactly what happened in the 1960s and ’70s when taxes on the rich were at their highest. The Civil Rights movement, the women’s movement, the consumer movement, the anti-war movement, and the environmental movement – social movements that grew out of the wealth and rising expectations of the post-World War II era’s middle class – these all terrified conservatives. Which is why ever since they took power in 1980, they’ve made gutting working people out of the middle class their number one goal.

We now have a choice in this country. We can either continue going down the road to oligarchy, the road we’ve been on since the Reagan years, or we can choose to go on the road to a more pluralistic society with working class people able to make it into the middle class. We can’t have both.

And if we want to go down the road to letting working people back into the middle class, it all starts with taxing the rich.

The time is long past due for us to roll back the Reagan tax cuts.

How The Financial Elite Have Failed Us

The doyen of global economics journalists, Martin Wolf: "The gainers should compensate the losers … they should be prepared to pay some of their winnings so that society remains civilised."
The doyen of global economics journalists, Martin Wolf: “The gainers should compensate the losers … they should be prepared to pay some of their winnings so that society remains civilised.” Peter Braig
On July 4, 2015, Kevin Chinnery writes on AFR Weekend:

Martin Wolf is the doyen of global economics journalists.

His weekly Financial Times column, which also runs in The Australian Financial Review, dissects the performance of the world’s top economic policymakers in prose of elegant and sometimes merciless clarity. Few are let off easily.

Normally, he would be sitting on the other side of this table, grilling a central banker or a Nobel laureate. It is vaguely unnerving to play the interviewer to him. Don’t worry, he confides: “It’s a lot easier asking the questions than it is answering them.”

We have come to Matt Moran’s Aria restaurant next to the Opera House, easy for a visitor arrived from London that morning to find.

Wolf might be lead columnist at the house journal of the world’s financial elites, but he has written a hefty book called The Shifts and The Shocks, in which he says these people have collectively screwed up. They did so with “complete insouciance” before the global financial crisis in 2008, he says, and have failed ever since to manage the recovery as well as they could have.

He is keen to order. Sashimi to start, then barramundi for both of us. I offer wine. He will have a glass of white, but gladly changes his mind when I don’t join him.

The GFC has been the crisis of my lifetime and his, I suggest, badly shaking the post-1945 era of prosperity we were both lucky enough to be born into. That makes it feel personal. I go through some of his book’s damning conclusions.

The banking sector has produced serial crises since it was unchained in the 1970s and 1980s, Wolf writes, and “no industry should be able to inflict damage equivalent to a world war” as it did in the GFC.


Globalising finance allowed the “transferring of excess savings of Chinese into the wasteful consumption of Americans, which made no sense. To generate a huge financial crisis as a result was worse than senseless”.

The crisis was an intellectual and moral failure of the Western elites that now threatens their political legitimacy, he concluded.

“It’s an angry book,” I say. “Yes,” he replies, “surely angry with myself because it ended up so much worse than I thought”.

“Here was a financial sector that had enormous power and influence, and wealth that had been fantastically mismanaged in a way that was familiar from 19th-century writings but which I assumed, in more modern times, could not recur,” he says. “It was a huge shock.”

But bad as the crisis at the banks was, Wolf thinks the GFC has masked deeper, more disturbing problems of declining growth, investment and productivity that were already bedevilling Western economies.

He squints through the midday glare at the Harbour Bridge in front of us. That was a massive Great Depression-era investment project, he remarks. It’s his theme: growth in the world economy is stagnant and disappointing not because it is sinking in debt, but because it is awash in a glut of savings for which there is nowhere to safely invest to get things going again.

“It is very clear to me that the engines of the world economy have not been working properly for quite a long time – that is, supply and demand,” he says.


Wolf tackles the beautifully sliced sashimi with just a fork. He eats quickly and keeps the conversation going without missing a beat – a valuable skill for a journalist – which I admire as I struggle to keep up.

The private sector in the advanced countries is sitting on huge profits and savings, he goes on. But there is nothing to unlock them for better use. There are no great new innovations, which demand enormous capital investment. Workforces are ageing and shrinking, and often now work in services.

“There are real reasons why our corporate sector does not see any need to invest a lot,” he says. And demand growth is even weaker than investment growth, he says, with one feeding off the other.

“In the developed world we don’t have much productive use for our savings. And that has meant that in normal times with normal interest rates, demand is insufficient. So what we do is create abnormal times with abnormal credit growth, which then blows up, and that seems to be the cycle that we are in,” he says. “The only way we get consumption to grow adequately is all these bubbles.”

Wolf says that the genuinely strong periods of economic growth in the 19th and early 20th centuries, and into the 1960s, all had the same thing: “a tremendous investment dynamic in the private sector … a huge investment boom to get the motor going”, even if it is not clear what caused those booms to happen.

It certainly isn’t there now. “What’s peculiar is that there has been no investment boom in the developed world for a very long time. The only investment booms are in housing, which is very nice but it doesn’t make us any richer.”

No longer needed or valued, our savings have become flows of hot, cheap money destabilising the economies they crash into, from the West into Asia in the 1990s, then from Asia into US houses, and more recently into a bubble of everything.


As our plates are cleared, Wolf starts quizzing the maitre d’ about the barramundi. Excellent eating, but he has never seen it anywhere else in the world. Is it found in Indonesia, perhaps? These fish were from Broome in WA, he is told; though he guessed right, it is also common in Asia.

Things might have been different if China and other emerging economies had successfully absorbed the West’s surplus savings.

“You could perfectly imagine another world history,” Wolf resumes. “China invests 50 per cent of GDP, it saves another 40 per cent of GDP, and imports the rest in foreign investment. All the other countries run huge surpluses, and accumulate large claims on the Chinese economy. That would be a perfectly normal economic relationship,” and it’s how America and Australia were financed.

But China is not normal. It would never allow foreigners to own its development.

Instead, he fears, China has just copied the West’s mistakes – a theme he would stress if he were writing his book again.

“It relied ludicrously on exports, saved too much. When the crisis hit, it had a temporary, distorting credit boom. It has slowed.”

Greece’s long agony is nearing a head as we meet. “Greece is proof that the euro was a very bad idea, at least when it was extended to countries so profoundly different from those of core Europe. It is not obvious whether it should seek to stay in or leave,” he tells me after the vote is announced.

I have never met anyone who can speak (and presumably think) in fully formed sentences at this sustained pace. Wolf came to journalism late, nudging over 40 in 1987, after a decade at the World Bank, and then at a London-based trade think tank.

He had thought of politics, but decided he would be bad at partisanship: “I tend to think everybody is wrong.”

It made a fine qualification for chief leader writer at the FT when the invitation came, and then chief economics commentator.


The post-1945 prosperity was the first time in history that the common person, at least in the West, has been treated well, I venture. Now that idea seems threatened by continual crises, and the spectre of technological unemployment to come.

Even Marx’s prophecies have been recently dug up again, I say: on the lines that globalisation and digitisation mean capital does not seem to need labour as it once did.

He says globalisation has benefited lots of people in the developing world, and lots of upper middle-class and upper-class people in the developed world. But not the middle and lower classes in the developed world.

“If you looked at the world economy in 1970, there had been tremendous growth, a lot of which had gone to the Western working classes who lived in a few relatively rich countries which shared income relatively widely, and had developed welfare states.

“Their incomes did not reflect any extraordinary talent or knowledge. They were just fortunate to live in countries that had the know-how, and live off the rent of scarce know-how, as it were.”

But that know-how has been globalised. “It is as easy to open a car plant in China as in the US,” he says. “In a global sense, inequality has fallen.” But there is more inequality within Western societies. Those with knowledge do very well, especially in the financial sector. Others are left out.

There is genuine tension, he says. “Globalisation and technology have given so many human beings opportunities they would not have had.” But the downside is “enormous stresses on Western societies, pulling them apart and making them less functional, less pleasant in pretty obvious ways”.

What should be happening, he says, is “that we go back to the beginning of economics, that the gainers should compensate the losers … they should be prepared to pay some of their winnings so that society remains civilised”.


It now surprises Wolf that we have “gone through the catastrophe of the GFC with no new questioning of economic models”.

When stagflation in the 1970s blew up the Keynesian world – which as he says, meant high taxes and, extraordinarily, a more egalitarian society run against the direct interest of elites – then the new model of monetarism and free markets was ready to step up.

He did not see it at the time, he says, but that intellectual change suited powerful interests.

“No comparable process has taken place this time,” he says: the GFC has not changed how we think about society because there is no countering political force to push an alternative view. That’s less to do with economic thought, he thinks, than who is powerful.

Giddy with that whiff of revolt from the top of the pink paper, I let Wolf return through the winter sunshine to his hotel.