UC San Diego To Create Hub For Robotics Study

UC San Diego developed Diego San, an experimental robot that is used in many research projects.
UC San Diego developed Diego San, an experimental robot that is used in many research projects. UCSD Jacobs School of Engineering

On October 29, 2015, Gary Robbins writes in The San Diego Union-Tribune:

UC San Diego is creating a robotics institute that will develop machines that can interpret everything from subtle facial expressions to walking styles to size up what people are thinking, doing and feeling.

The “See-Think-Do” technology is largely meant to anticipate and fulfill people’s everyday needs, especially the soaring number of older Americans who want to live out their lives in their own homes.

Engineers envision robots that are so good at sizing up people, places and situations that they could help evacuate crowds from dangerous areas and pick through the rubble of an earthquake to look for survivors.

The newly created Contextual Robotics Institute will be formally announced on Friday when some of the nation’s top scientists meet at UC San Diego to discuss the future of robotics. The campus has already lined up support from such San Diego companies as Qualcomm, which needs new markets for its computer chips, and Northrop Grumman, which develops unmanned aerial vehicles.

“Our plan is to do the research and development that’s needed to realize robots of the future — robots that are safe, useful and autonomous in any environment,” said Albert Pisano, dean of UC San Diego’s Jacobs School of Engineering.

“That means pulling together our engineers and our social scientists to focus on both the robots themselves and how people will interact with them.”

Robotics is a field seemingly without boundaries.

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Google’s self-driving carGoogle
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Google is testing self-driving cars. The Massachusetts Institute of Technology is creating bionic arms. Santa Clara-based Savioke is experimenting with mechanical butlers that deliver snacks to hotel guests.

The Defense Department is working on intelligent machines that can distinguish between enemies and allies. And Canadian researchers are exploring whether it’s possible to design robots that can teach themselves to perform common tasks — like cooking dinner — by watching YouTube videos.

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UCSD Chancellor Pradeep Khosla was recruited from Carnegie Mellon University, which runs one of the nation’s most respected robotics programs. UCSD

“The field of robotics is changing how people live, work and age,” said UC San Diego Chancellor Pradeep Khosla, an internationally renowned roboticist who played a key role in creating the new institute.

This is a moment of convergence for the university.

More than 40 of the school’s researchers have volunteered to collaborate on projects aimed at getting hardware and software to recognize their environment and what’s going on in it. Such robots, or robotic systems, would be designed to do something useful with the information.

Broadly speaking, robots would be able to see, think and do.

Such research can be humbling, especially if you’re developing semi-autonomous robots that move. That was painfully obvious in June when teams from around the world competed in the DARPA Robotics Challenge in Pomona. Many robots tipped over or did nothing at all when told to perform a complex task in a degraded environment.

DARPA Robotics Challenge Fails

But scientists are making a lot of progress with software, which is often the essence of a robot or robotic system.

In particular, UC San Diego has been developing the sort of software and sensors that would be needed to unobtrusively monitor the health and well-being of an elderly or disabled person living in their home. The goal: allow people to “age in place” — a place they desire.

Researchers have created facial recognition programs that can detect an array of emotions, from joy and sadness to surprise, disgust and contempt. The campus also developed software that assesses how much pain a person is feeling.

The software has emerged at the same time that researchers nationwide have been developing wireless sensors that can detect everything from whether a person is moving normally to whether they’re taking prescription pills and making it to the bathroom. Some of the sensors are wearable. Others can be embedded in things like household appliances, furniture, and flooring.

Scientists say it is possible to blend the software and sensors into systems that size up how a person is doing, then texts or emails the information to their family, caregiver or doctor.

“The thought of going to an assisted living facility or a nursing home is scary for most people,” Khosla said. “People want to live in their homes as they age. And this is where sensors, software, and robotics technology can be most impactful. They enable smarter caregiving and more independence.”

There is a growing demand for elder-care. People are living longer. And seniors represent a growing percentage of the population. Each day, about 10,000 baby boomers turn 65.

But many challenges lie ahead.

Scientists have a spotty record of developing user-friendly technology, especially in robotics. And many people would object to being monitored. Technology also can be fallible, and vulnerable.

“Smart objects connected together was once a great marketing tag line,” Leslie Orlov recently wrote on her widely-respected blog, Aging In Place Technology Watch. “Now it is becoming an Orwellian nightmare, not just because Google can drive the car while you text. Now we know your car has millions of lines of code in it and is easily hacked by two guys on a couch with a laptop.”

Yawen Li, a health sociologist at San Diego State University, said, “The biggest concern I see is privacy. How do you protect data that is collected in a person’s home and sent to a service provider?

“People are getting used to adopting technology, especially baby boomers. They use technology much more than previous generations. I think that, over time, people will accept things like sensors in their home if they make life more convenient and efficient — but only if privacy concerns are addressed.”

Qualcomm is looking for new ways to become part of everyone’s lives, not just those who might need assistance at home. Last fall, the company created a program to back startups that are working on next generation robotics and intelligent machines.

Qualcomm is supporting everyone from drone makers to a firm that makes a game console for unattended dogs.

“The field of robotics is in a state of revolution,” said Matt Grob, Qualcomm’s chief technology officer. “And the robotics institute intersects with our business in multiple ways.

“Having this center in our backyard is very exciting. We get to the forefront of what researchers are doing.”

http://www.sandiegouniontribune.com/news/2015/oct/28/ucsd-robotics-institute/

http://www.latimes.com/business/technology/la-fi-cutting-edge-ucsd-robots-20151101-story.html

This is yet another article about the march of technology to develop humanoid robots with human seniority perception. But what is most alarming is that the beneficiaries of the taxpayer monies awarded to UCSD to develop this technology, is freely given without the requirement that the employees and other citizen broadly own the companies who will directly benefit. This is the norm for taxpayer-funder research and development of future technologies.

None of our leaders are providing needed leadership to ensure that when taxpayer dollars are used to prop up and underwrite technological invention and innovation that the companies financially benefiting need to be fully employee owned, at the minimum. We, as a nation with a vast population of wages slaves, welfare slaves, consumer debt slaves and charity slaves need to institute a new policy direction that empowers EVERY citizen to become an OWNER in the future technological capital assets being developed with taxpayer monies.

This can be accomplished using insured, interest-free capital credit, repayable out of the future earnings of the companies developing the technologies. To learn how see the Capital Homestead Act at http://www.cesj.org/learn/capital-homesteading/http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/. See http://www.cesj.org/learn/capital-homesteading/ch-vehicles/.

Improving oOpportunities For California Workers

On October 28, 2015, Gavin Newsom and Ashley Swearengin write in The San Diego Union-Tribune:

It seems nearly every day a new technological wonder changes the way Americans live, learn and work. From breakthrough apps to digital networks to automated vehicles, California is consistently a strong engine that pushes our country forward. Yet, too many in our state and elsewhere in the country, feel that opportunity is increasingly out of grasp. So often we hear of six-figure starting salaries and multibillion-dollar IPOs in Silicon Valley, but the stories are very different in places like Fresno, Bakersfield, Stockton and plenty of other American cities where the middle class is rapidly shrinking.

As digital technology thrusts our nation into its greatest economic transformation in over a century, we must work together to ensure everyone benefits. It’s time for all leaders to work through the fog of partisanship and commit to an action agenda to create opportunity for all Americans. This is the new imperative.

The Industrial Revolution of the 19th century forced America to transform the way it trained workers as they moved from field to factory. Now the digital revolution of the 21st century and our shift from an economy of bricks and mortar to one driven by software requires a different approach. We have to rethink how we educate our workforce, train workers to have skills they need for the digital age and better connect employers with job seekers.

While we may represent different sides of the aisle, we both care deeply about improving the livelihood of our citizens. It’s why we and many other diverse leaders support Rework America, a nonpartisan group focused on driving opportunities in today’s digital world. Where some see technology and globalization as threats, we see opportunities to help all Americans thrive.

We can start by developing the workforce of tomorrow, not the workforce of yesterday. The traditional methods of preparing workers are over and educators and trainers, businesses and leaders must create the right conditions for success. California, and every other state, needs a well-educated workforce to innovate and move the economy forward. We need a skills based labor market where people are hired based on skills rather than degrees that don’t adequately reflect a person’s qualifications for a job.

We can match Californians to available jobs by connecting workers, employers and education and training providers. Rework America recently announced plans to develop a digital platform (www.reworkamericaconnected.org) to do this in the city of Phoenix and in the state of Colorado. The Markle Foundation and its partners, including LinkedIn, Arizona State University, edX, and local and state employers and educators are partnering to build an innovative kit of technology tools and support systems to create a pipeline of qualified workers to fill middle-skill jobs — jobs that don’t require four-year college degrees.

Businesses will post the skills required while workers armed with this knowledge can demonstrate they have the skills or can connect with available training and education providers to secure them. We can learn from these efforts and tailor them to meet specific needs in California.

Similarly, we need to open new avenues for workers to build on skills throughout their careers. Through lifelong learning we can move away from notions of “blue collar” and “white collar” and move to a “no collar” world — where workers continually learn and refresh their skills.

In this day and age, a highly skilled workforce isn’t enough. Businesses, too, need to be on the front lines of the digital economy to help connect small businesses to a worldwide customer base. This would help enable small entrepreneurs to offer both goods and services to the world’s growing middle class and in turn make our state better equipped to meet the needs of a dynamic global market.

At the same time we can leverage technology to develop new lending models such as microfinance or peer-to-peer services to help California’s small businesses get the capital they need to grow.

Of course, none of these ideas will become a reality overnight. Like a century ago, it’s going to take a concerted investment from businesses and government. Reasonable people can disagree on the specific steps we need to take, but we can all agree that the path to opportunity is rapidly changing, and no one should be left behind.

Whether in entertainment, education, or technology, the things we do in California help shape what happens everywhere else in the country. If we unite — across sectors and across the aisle — we can be the leading force in creating the model digital economy, one in which all Americans have the opportunity to succeed.

Newsom is lieutenant governor of California. Swearengin is mayor of Fresno. They are co-authors of “America’s Moment: Creating Opportunity in the Connected Age,” a book by Rework America.

Newsom is lieutenant governor of California. Swearengin is mayor of Fresno. They are co-authors of “America’s Moment: Creating Opportunity in the Connected Age,” a book by Rework America.

http://www.sandiegouniontribune.com/news/2015/oct/28/improving-opportunities-california-workforce/

It is a reality that every day new technological invention and innovation changes the way Americans live, learn and work. It is also true and imperative that  we must ALL work together to ensure everyone financially benefits. It’s time for all leaders to commit to an action reform agenda to create opportunity for all Americans, especially with regards to empowering EVERY citizen to be productive through their personal OWNERSHIP shares in future wealth-creating, income-producing capital assets that result from technological invention and innovation.

The authors, both politicians, are stuck in the single factor thinking of job creation, completely ignoring the non-human factor of production, which consists of the productive capital assets that create wealth and produce income for those who OWN the assets.

Instead, the emphasis is on educating and training our workforce to have skills they need for the digital age and better connect employers with job seekers. It’s why they and many other diverse leaders support Rework America.

Yet they are extremely shortsighted because, while there will be a need for educating and training people with the skills necessary to advance our technological prowess, this will not be in sufficient numbers to match the pool of people willing and able to work in such positions. That is because tectonic shifts in the technologies of production and competitive globalized production are destroying jobs and devaluing the worth of labor far more than the level of job creation. The reality is 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. While we do need to start developing the workforce of tomorrow, at the same time we need to empower EVERY child, woman, and man to acquire personal OWNERSHIP of wealth-creating, income-producing capital assets of the future, simultaneously with the growth of the economy.

Yet, we sorely lack leadership, both in the political spectrum and the private business sector and academia, to identify this problem and to develop solutions, such as insured, interest-free capital credit, repayable with the earnings of the corporations growing the economy. Until we embrace an Ownership Culture  and enact every economic policy such that the result simultaneously creates new capital owners as the economy grows, a job focus alone will fall way short of empowering EVERY citizen to be a productive contributor to our society.

For solutions, support the Capital Homestead Act at http://www.cesj.org/learn/capital-homesteading/, http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/. See http://www.cesj.org/learn/capital-homesteading/ch-vehicles/.

 

Do Robots Need A Human-Like Sense Of Touch?

On October 30, 2015, Greg Nichols writes on Robotics and ZD Net:

SynTouch, a California company working to give robots a human-like sense of touch, was recently awarded $2.5M in grants from the National Science Foundation and the Office of Congressionally Directed Medical Research Programs.

So what’s special about human touch?

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Consider what happens when you throw snowballs at your kid for a few minutes or try to scrape ice off a car windshield without wearing gloves. Your hands go numb and it becomes very difficult to perform fine motor tasks, such as zipping up your jacket or getting your keys in the ignition.

Those scenarios are so familiar they may not strike you as noteworthy, but numb hands are a real head scratcher for roboticists. In the above cases, your hands haven’t lost any of their mechanical abilities. Your muscles still work as they always have and the joints open and close freely. What’s changed is your sense of touch. You can no longer feel pressure, texture, heat or a number of other properties that we unconsciously rely on for fine manipulation. Your beautifully capable hands are reduced to clunky manipulators.

Which is exactly how robots feel (pun intended). Deprived of the full tactile sensing capabilities of the human hand, which is arguably the most nuanced manipulator in the world, even mechanically sophisticated robotic end effectors are cludgy and … well, robotic.

“Classically, pressure sensing has been performed with a strain gauge, which is an electronic element that deforms slightly when force is applied,” says Matt Borzage, founding partner of SynTouch, during a recent phone chat. “If you have a digital bathroom scale, it uses a strain gauge to tell you how much you weigh.”

Unlike a human finger, a simple strain gauge can only measure force in one dimension. Engineers have tried putting a few of them together in different orientations to make a more complex sensor, but that yields a fragile device that still doesn’t work the way a human finger does.

For example, the best strain gauge still won’t sense where the precise point of contact with an object is. It also can’t measure texture or physical properties like squishiness, essential data for a robot when it’s not sure whether it’s reaching for a sponge or a brick.

“We’ve spent a lot of time looking at hands,” says Borzage. “Not just sensing, but combining sensing with the right form factor to allow robotics fingertips to do useful things.”

The result, according to SynTouch, is “the only sensor technology in the world that endows robots with the ability to replicate — and sometimes exceed — the human sense of touch.”

SynTouch’s BioTac sensor consists of an elastic skin over an epoxy core, where the electronics are located. Between the skin and the epoxy core is a layer of fluid. Electrodes on the surface of the core come into contact with the fluid, and when an object is grasped, the system maps the resulting electronic signals.

But human fingertips also sense texture. “To tackle that,” says Borzage, “we borrowed from the world of acoustic measurement.” When you rub your finger over the surface of an object, your skin will vibrate slightly. “The same thing happens in our sensor. In our case, those vibrations pass through the fluid underneath the skin. We measure those, which allows us to extract information about texture.”

The BioTac sensor also uses temperature the way the human finger does. A small heating element elevate’s the temperature of the BioTac above room temperature. An embedded sensor called a thermistor is able to measure any change in temperature that occurs when the finger tip comes into contact with an object. That allows a robot to get a sense of what the object is made of. Metal is a better thermal conductor than polyester, for example, so more heat will flow out of the finger when it’s touching a stapler than when it’s gripping the back of an upholstered chair. That information is crucial to figuring out a grasping strategy.

What’s most interesting about the BioTac is that the underlying technology is not groundbreaking — much of it has been around for years, which means it is both robust and time-tested. Because the electronics are concealed deep within the core of the sensor, the device itself is robust enough to handle real-world grasping applications, a shortcoming of many tactile sensors.

The National Institutes of Health see real potential for SynTouch’s technology in prosthetic hands. Much of the recent grant money will be directed toward research that may one day result in bionic limbs endowed with a truly human-like sense of touch — and the dexterity that goes with it.

http://www.zdnet.com/article/collaboration-and-security-can-coexist-in-the-cloud-says-ciso-danny-miller/?tag=nl.e232&s_cid=e232&ttag=e232&ftag=TRE6a12a91

This article is all about the march of technology to develop humanoid robots with touch seniority perception. But what is most alarming is that SkyTouch is the beneficiary of a taxpayer monies to develop this technology, without the requirement that the employees and other citizen broadly own the company. This is the norm for taxpayer-funder research and development of future technologies.

SynTouch, LLC developed and makes the only sensor technology in the world that endows robots with the ability to replicate – and sometimes exceed – the human sense of touch. Its lead product – the BioTac – mimics the mechanical properties, physical structure and the sensory capabilities of the human fingertip. Founded in 2008 and headquartered in Los Angeles, SynTouch provides Machine Touch ™ – complete tactile sensing solutions inspired by human applications of touch.

Gerald Loeb is a co-founder of SynTouch, a spin-off company from the Medical Device Development Facility of the University of Southern California, which Dr. Loeb directs as Professor of Biomedical Engineering. He is a co-inventor of the BioTac technology among his more than 60 issued US patents covering many areas of neural engineering and prosthetics.

None are our leaders are providing needed leadership to ensure that when taxpayer dollars are used to prop up and underwrite technological invention and innovation that the companies financially benefiting need to be fully employee owned, at the minimum. We, as a nation with a vast population of wages slaves, welfare slaves, consumer debt slaves and charity slaves need to institute a new policy direction that empowers EVERY citizen to become an OWNER in the future technological capital assets being developed with taxpayer monies.

This can be accomplished using insured, interest-free capital credit, repayable out of the future earnings of the companies developing the technologies. To learn how see the Capital Homestead Act at http://www.cesj.org/learn/capital-homesteading/, http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-a-plan-for-getting-ownership-income-and-power-to-every-citizen/ and http://www.cesj.org/learn/capital-homesteading/capital-homestead-act-summary/. See http://www.cesj.org/learn/capital-homesteading/ch-vehicles/.

House Votes To Revive Export-Import Bank

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The vote sends the legislation to the Senate. | AP Photo

On October 27, 2015, Victoria Guida writes on Politico:

Led by rebellious Republican moderates, the House voted overwhelmingly Tuesday to revive the Export-Import Bank in a major setback for conservatives who wanted to kill an institution they say epitomizes corporate welfare.

The 313-118 vote sends the legislation to the Senate, where supporters are attempting to craft a plan to bring an Ex-Im bill to the president’s desk. A majority of House Republicans and a third of the House Financial Services Committee Republicans voted for the measure.

Senate Majority Leader Mitch McConnell has said he won’t take up a standalone bill, although he has allowed the agency’s renewal to be attached to other must-pass legislation. While a bill identical to the one that cleared the House on Tuesday also passed the Senate, it was attached to that chamber’s long-term highway bill. If the House passes its own long-term highway bill next week, as expected, supporters expect that will serve as the vehicle for a conference bill that could include Ex-Im’s renewal.

“The way to achieve Ex-Im – if it is going to be achieved in the Senate – would be in the context of the highway bill,” McConnell said Tuesday before the vote.

Illinois Republican Mark Kirk, who is leading the Senate’s reauthorization efforts, said he is pursuing such a plan.

“I think we’re going to go with the leader’s plan, which is to attach it to transpo,” Kirk told POLITICO on Tuesday before the Republican conference lunch.

For now, though, the House vote is a major step on the tortured path to reviving the export credit agency.

House backers of the expired export credit agency, led by Tennessee Republican Stephen Fincher, used a rare parliamentary maneuver to force a vote on the agency, over the opposition of conservative Republicans. The agency, which promotes exports by U.S. companies, expired this summer after conservatives denounced it as an expensive giveaway to special interests. Supporters say its loan guarantees support more than 160,000 U.S. jobs.

Supporters signaled Tuesday they were keeping their options open. House Minority Whip Steny Hoyer said ahead of the vote that Senate Democratic leaders Harry Reid and Patty Murray were seeking to convince McConnell to move a standalone bill.

Ohio Republican Rob Portman acknowledged that the highway bill is one vehicle but indicated there could also be others. “I think by the end of the week, [the House] will have a strong vote,” he said on Tuesday. “So that might change the calculus, I don’t know. But it needs to get done; we’re losing jobs, thousands of jobs.”

Even if the House and Senate highway bills go to conference before Thanksgiving, it is not a foregone conclusion that the Ex-Im renewal would be part of the final bill.

“You would’ve been hard-pressed to see how a new House leadership team and a whole bunch of committee chairmen would’ve rewarded [Ex-Im supporters] and allowed it to be added into a conference committee report,” said Dan Holler, a spokesman for Heritage Action, the conservative advocacy group which opposes the renewal.

Meanwhile, House Financial Services Committee Chairman Jeb Hensarling, who has done more than any other member to destroy the bank, is looking at the bright side. “The last time the House voted on a long-term reauthorization of Ex-Im, only 93 members voted against it. Today, 118 voted no. Momentum is moving in favor of those who oppose Ex-Im’s corporate welfare,” he said in a statement.

http://www.politico.com/story/2015/10/export-import-bank-house-vote-215218

The truth is that the Export-Import Bank is an institution that epitomizes corporate welfare, because the loan guarantees it provides benefits American corporations which are not fully employed owned but instead narrowly owned by an already wealthy ownership class who benefit from American taxpayers.

The entire argument on the debate about the fate of the 80-year-old government agency known as the Export-Import Bank is centered around JOB CREATION rather than OWNERSHIP CREATION. As noted in the article, supporters argue that the bank’s loan guarantees support more than 160,000 U.S. jobs but fail to also acknowledge that the overwhelming wealth-creating, income-generating benefits will accrue to the already wealthy ownership class, who dominate the ownership structure of American corporations.

The result of the decades-long financial support for companies exporting American-made products is an example of crony-end game capitalism disguised to the taxpaying citizens as necessary to create jobs. NO WHERE are there stipulations that the the companies benefiting be financed so that the workers will end up owning a significant share of the new growth capital assets and the benefits of the wealth-creation and income generated from selling their products globally. While the mission of the Export-Import Bank is to create and sustain U.S. jobs by financing sales of U.S.  goods and products to foreign buyers and help small and mid-size manufacturers throughout the country by providing loans, guarantees, insurance and other aid to those buyers, there is no stipulations that the companies benefiting from the taxpayer aid be fully employee-owned. Instead taxpayer aid is boosting the growth of technologically infused manufacturing with advanced “robotics.” digitalized operations, and super-automated capital assets, that will be OWNED by a select narrow group of already wealthy owners who get to cash in on taxpayer incentives and subsidies.

The Export-Import Bank charter needs to be reformed to provide stipulations that workers are empowered and aided using insured capital credit loans repayable with pre-tax future earnings to create over time significant individual worker ownership shares in these companies. A Justice-Based Managed Employee Stock Ownership Plan (ESOP) (http://www.cesj.org/?s=eSOP) is the financial mechanism that should be used for this objective so that new manufacturing growth becomes broadly owned over time and the workers benefit from a Second Income from dividend earnings to supplement their wages.

Where is the rallying cry for OWNERSHIP NOW!?

Hillary Clinton Opposes Reinstating Glass-Steagall

aaaaaaaaaaaaaahillaryFormer Secretary of State Hillary Clinton has rejected the hard choice of reinstating the Glass-Steagall Act to rein in Wall Street. (Photo: Mike Mozart)

On October 9, 2015, Mark Karlin writes on Buzzflash:

Amidst the announcements by former Secretary of State Hillary Clinton that she officially opposes the northern sector of the Keystone XL pipeline and has taken a position against the Trans-Pacific Partnership, there has been little discussion of Clinton’s announcement that she is opposed to the reinstatement of the Glass-Steagall act.

The infamous repeal of the Glass-Steagall Act occurred during the waning days of the Bill Clinton administration, with his full support. The law, according to Investopedia, was “an act the U.S. Congress passed in 1933 as the Banking Act, which prohibited commercial banks from participating in the investment banking business.”

As an analysis of Clinton’s position by journalist Dylan Stableford of Yahoo! Politics states:

The Glass-Steagall Act, passed in 1933, prohibited commercial banks from participating in the investment banking business and created the Federal Deposit Insurance Corporation (FDIC) to protect bank deposits from institutional failure. But major provisions of the law were repealed in 1999 under President Bill Clinton, a move some believe contributed to the 2008 global credit crisis because commercial banks – now free to invest in things such as real estate – were saddled with billions of dollars in losses tied to cratering U.S. home prices. Several lawmakers on both sides of the aisle have called for the reinstatement of the law to make “too-big-to-fail” banks much smaller, minimize risk and prevent such a crisis from happening again.

An onslaught of critics have blamed the repeal of the Glass-Steagall Act for the 2008 US economic implosion, the bailing-out of banks with billions and billions of taxpayer dollars, and the ongoing fraud and illegal behavior of many large banks. Clinton, however, says that she has a better prescription to cure Wall Street misbehavior.

In an op-ed printed in Bloomberg Views on October 8, Clinton spelled out her plan to rein in Wall Street:

“Seven years after the financial crash, despite important new rules signed into law by President Barack Obama, there are risks in our financial system that could still cause another crisis. Banks have paid billions of dollars in fines, but few executives have been held personally accountable. “Too big to fail” is still too big a problem. Regulators don’t have all the tools and support they need to protect our economy. To prevent irresponsible behavior on Wall Street from ever again devastating Main Street, we need more accountability, tougher rules and stronger enforcement. I have a plan to build on the progress we’ve made under President Obama and do just that….

“One serious approach being advocated is to pass an updated Glass-Steagall Act, separating commercial and investment banking, to reduce the size of the banks and the risk of a taxpayer bailout. I certainly share the goal of never having to bail out the big banks again, but I prefer the path of tackling the most dangerous risks in a different way.”

Some of the proposals in Clinton’s op-ed are steps forward, including a tax on high-frequency trading, enforcement of the Volcker Rule (which limits speculative investments), and “a new fee on risk that would discourage the type of excessive leverage and short-term borrowing that could spark another crisis.”

Clinton makes a few other promises to hold financial firms accountable for gambling with the US economy, but one has to ask: Why she wouldn’t want to add those measures onto an enhanced Glass-Steagall Act?

Perhaps that is because the repeal of Glass-Steagall is the keystone that allowed Wall Street to become a hydra-headed monster of financial manipulation, and any effort to reinstate it fills the titans of the financial world with frothing dread. Clinton’s proposals rely heavily on the promulgation of regulations and regulatory enforcement, as well as serious prosecution from the Department of Justice (which let banks and bank executives off with a relative slap on the wrist under Eric Holder’s tenure as attorney general). Under the Obama administration, there’s been a lot of rhetoric in support of regulatory action to limit financial malfeasance, but far too little action.

Clinton claims to “have what I consider to be a more comprehensive approach [than Glass-Steagall] to what we need to do to rein in these institutions, including the big banks.” In short, Clinton, who has been a favorite of Wall Street donors since her days as a senator representing New York, is asking voters to trust that she will seriously take executive action against her dear friends and champion donors. The Obama administration, however, has shown how easy it is to ignore matching enforcement to promises of getting tough.

Will the Wall Street money keep flowing to Hillary Clinton despite her claim that she will clamp down on financial chicanery? It sure looks like it will if you agree with CNN Money’s October 8 article that asserts “Wall Street isn’t worried about Hillary Clinton’s plan:

“Hillary Clinton unveiled her big plan to curb the worst of Wall Street’s excesses on Thursday. The reaction from the banking community was a shrug, if not relief.

“While Clinton proposes some harsher regulations, she stops far short of what more populist Democrats likeBernie Sanders and Elizabeth Warren want to do to Wall Street.

“‘We continue to believe Clinton would be one of the better candidates for financial firms,” wrote Jaret Seiberg of Guggenheim Partners in a note to clients analyzing her plan.Sanders and Warren think the big banks should be broken up. Clinton does not. It’s a big divide in the Democratic party….

“‘To us, [Clinton’s] overall plan demonstrates an understanding of the financial system that we have not previously seen on the campaign trail,’ Seiberg wrote.”

Some may argue that Clinton, who supported the northern section of the Keystone XL pipeline as secretary of state, only changed her position now because she needs to appear more progressive. Some may also argue that Clinton – who was supportiver of the Trans-Pacific Partnership as secretary of state and in her gook Hard Choices* – came out against it recently to keep Bernie Sanders from using it as an issue in the first Democratic debate next week. Opposing the TPP might also serve to differentiate Clinton from potential primary opponent Joe Biden, who has to support the TPP because he is vice president in an administration that is pushing for its congressional passage. (Of course, some might consider those assessments of Clinton’s position changes cynical.)

On Glass-Steagall, a reversal might not be so simple for Clinton. On July 21 (before the Clinton Wall Street plan was formally announced), a CNBC article noted that “Clinton rakes in Wall Street cash amid tough talk:

“Clinton still attracts Wall Street money. Because she was a New York senator, she maintains an “institutional connection” to the financial industry, said Lisa Gilbert, director of the Congress Watch division at Public Citizen.

“Clinton acknowledged that relationship in a speech last week, giving a nod to the what she deemed the financial industry’s positive role in the economy.

“‘As a former senator from New York, I know firsthand the role that Wall Street can and should play in our economy,” Clinton said, “helping Main Street grow and prosper and boosting new companies that make America more competitive globally….'”

In the speech CNBC quotes from, Clinton did acknowledge that Wall Street needed a bit more regulation to ensure that risk-taking did not cause a repeat of 2008.

Nevertheless, the former New York senator will likely continue to receive Wall Street campaign funding, because she does not support the reinstatement of the law – The Glass-Steagall Act – that would chop off the arms of the menacing financial octopus that was created as a result of its repeal.

http://www.truth-out.org/buzzflash/commentary/news-you-might-have-missed-hillary-clinton-opposed-to-reinstating-glass-steagall-act/19575-news-you-might-have-missed-hillary-clinton-opposed-to-reinstating-glass-steagall-act

This is the position of the Center for Economic and Social Justice (www.cesj.org), which I am associated. Before the Crash of 1929, commercial and investment banking were linked. That meant that stock brokers in an investment bank could go to the related commercial branch and have the commercial branch create money to loan to an investor, sometimes with as little as 3% down.

This resulted in massive money creation that fueled speculation on Wall Street, driving up the prices of shares to unheard-of heights. When people realized there was nothing behind the rise in share values except private sector debt backed by the rise in share values, the stock market crashed.

To correct this and prevent it from happening again, Senator Carter Glass of Virginia (who had been instrumental in the passage of the Federal Reserve Act of 1913) and Representative Henry B. Steagall of Alabama insisted on provisions in the Banking Act of 1933 that separated commercial and investment banking. There were, unfortunately, some loopholes, especially those that permitted money creation backed by government securities (or, more accurately, didn’t prohibit it), but by and large Glass-Steagall effectively instituted solid principles of internal control into the financial services industry.

In the 1980s efforts began to repeal Glass-Steagall, which was accomplished in two phases. The first resulted in the savings and loan debacle, and the second led directly to the home mortgage meltdown.

The current wild fluctuations in the stock market are, in a sense, not directly related to the repeal of Glass-Steagall, as they are funded largely by government instead of private sector money creation. The lack of separation of function between investment and commercial banking makes this easier, but that is all. Commercial banks are channeling funds to speculation instead of using their money creation powers backed up by the Federal Reserve to finance private sector investment in new capital.

That is why sound principles of internal control would mandate not merely a separation of investment and commercial banking again, but also mandate that financial institutions of all types stick strictly to the purpose for which they were instituted. A commercial bank would make commercial loans, a savings and loan would make consumer loans, an insurance company would offer only insurance, an investment bank would mediate between stock issuers and stock purchasers, and so on.

Above all, there would be no creation of money backed by government debt. If a government borrows, it must be out of existing savings. The only reason the Federal Reserve was permitted to deal in government securities on the open market was to retire the debt-backed United States Notes, National Bank Notes, and Treasury Notes of 1890, and replace them with Federal Reserve Notes backed with private sector hard assets.

The bottom line here is that if proper internal controls are in place, it is no longer a question whether the government or the banks are creating too much or not enough money for non-productive spending and speculation. The question answers itself, because the system would prohibit ALL new money creation except that which is backed by non-speculative, private sector hard assets. Governments, like the rest of us, would have to learn to live within their means, meaning what can be raised by taxation, not issuing government debt-backed funny money.

To ensure the viability of such a move, it would have to be linked to an aggressive program of expanded capital ownership, such as Capital Homesteading, increasing the number of capital owners, rebuilding the tax base, and decreasing the need for massive government entitlements.

The Middle-Class Squeeze

If Western countries want to disprove the dire forecasts of Karl Marx, we must think creatively about how to make the middle class more prosperous and secure

BN-KM345_MIDDLE_J_20150925122845
The middle class is in trouble. Can we reverse course—or was Marx right about the dynamics of capitalism? ILLUSTRATION: ROBERT NEUBECKER
On September 25, 2015, Charles Moore writes in The Wall Street Journal:

Go back, for a moment, nearly 30 years. In March 1987, Margaret Thatcher visited Mikhail Gorbachev, the reforming leader of the Communist Party of the Soviet Union, in Moscow. Sitting in the Kremlin, the two argued for hours. At one point, Mr. Gorbachev accused Mrs. Thatcher of leading the party of the “haves” and of fooling the people about who really controlled the levers of power. The Iron Lady had an answer: “I explained,” she wrote in her memoirs, “that what I was trying to do was create a society of ‘haves,’ not a class of them.”

In the era of Ronald Reagan and Margaret Thatcher, those words carried conviction. There was plenty of argument, of course, about whether the means they chose were the best and about the fate of those who got left behind. But even critics reluctantly had to agree about which way history was heading: The society of “haves” in the West was growing; state socialism was imploding.

Most of the rest of the world was hoping to follow the West’s example. Two and a half years later, the Berlin Wall fell. Almost all the newly emerging ex-Communist regimes sought market freedoms for their people. Back home in the Anglosphere, the spread of ownership—of stocks and homes—and the expansion of economic and personal opportunity were the dominant themes of the age. As Mrs. Thatcher bustled around Whitehall urging on her program of popular capitalism, she used to shout: “Every earner an owner!”

In 2015, it is difficult to imagine a version of that Thatcher/Gorbachev conversation being replicated between any Western leader and the hostile and suspicious Vladimir Putin.Neither side seems to have an intelligible ideology. Besides, the confidence is not there anymore.

We have become a society of ’have lesses,’ if not yet of ‘have nots.’ ENLARGE
We have become a society of ’have lesses,’ if not yet of ‘have nots.’ PHOTO: GETTY IMAGES

Since the financial crisis of 2007-08, which Western leader could boast of spreading ownership in any important way? In the U.S. and Britain, the percentage of citizens owning stocks or houses is well down from the late 1980s. In Britain, the average age for buying a first home is now 31 (and many more people than before depend on “the bank of Mom and Dad” to help them do so). In the mid-’80s, it was 27. My own children, who started work in London in the last two years, earn a little less, in real terms, than I did when I began in 1979, yet house prices are 15 times higher. We have become a society of “have lesses,” if not yet of “have nots.”

In a few lines of work, earnings have shot forward. In 1982, only seven U.K. financial executives were receiving six-figure salaries. Today, tens of thousands are (an enormous increase, even allowing for inflation). The situation is very different for the middle-ranking civil servant, attorney, doctor, teacher or small-business owner. Many middle-class families now depend absolutely on the income of both parents in a way that was unusual even as late as the 1980s.

In Britain and the U.S., we are learning all over again that it is not the natural condition of the human race for children to be better off than their parents. Such a regression, in societies that assume constant progress, is striking. Imagine the panic if the same thing happened to life expectancy.

When things go backward in nations accustomed to middle-class stability, people start to ask questions. What is the use of capitalism if its rewards go to the few and its risks are dumped on the many? The rights of property do not seem so enticing if the value of what you own collapses or if that property is trapped by debt. What is so great about globalization if it means that the products and services you offer are undercut by foreign competition and that millions of new people can come to your country, take your jobs and enjoy your welfare benefits?

Great international banks and other corporations—and their top executives—can devise a life that escapes normal tax jurisdictions. Their successes are globalized and accrue chiefly to them; their failures crawl back home to die, at the expense of the rest of us.

So instead of feeling that it is a privilege to be an ordinary citizen of a free country, many of us start to feel a bit like suckers. Hope—the inseparable companion of progress—fades and is replaced by disappointment, even bitterness. It has always been understood that opportunity carries some price of insecurity, but what happens if insecurity rises and opportunity contracts?

Our politics has begun to match these uneasy feelings. “You people are suffering,” bellows Donald Trump to cheering crowds of seemingly fairly prosperous people. Material suffering is not, despite the ups and downs of his own business, an experience that he knows much about, but he finds a ready audience. Meanwhile, in Britain, an overwhelming majority of the Labor Party, which won three general elections in a row under the centrist Tony Blair, has just selected a new leader, Jeremy Corbyn, a 66-year-old veteran of hard Left politics who looks forward to the end of capitalism. Until a couple of months ago, he seemed almost literally the most unelectable person in his entire party.

Extremes of both left and right are doing well. These bad times have been good for the left-wing Syriza party in Greece, the democratic socialist Bernie Sanders in the U.S. and the antiausterity Scottish Nationalists; but also for Marine Le Pen’s National Front in France,Viktor Orban’s Fidesz in Hungary and the UK Independence Party (UKIP) in Britain. There is nothing contradictory about this seeming confluence of the extremes. It is happening because the center cannot hold, or at least does not know what to say about itself.

Where might one find a useful analysis of what is happening today in the market democracies of the West? How about this: “The executive of the modern State is but a committee for managing the common affairs of the bourgeoisie.” Or this: “Modern bourgeois society…is like the sorcerer, who is no longer able to control the power of the nether world which he has called up by his spells.” Or this: “The productive forces no longer tend to further the development of the conditions of bourgeois property: on the contrary, they have become too powerful for these conditions…[and] they bring disorder into the whole of bourgeois society, endanger the existence of bourgeois property.”

Karl Marx ENLARGE
Karl Marx PHOTO: CORBIS

All these quotations are from a work published in 1848 that caused quite a stir. It was written by Karl Marx and Friedrich Engels and was called “The Communist Manifesto.” Even now, people have heard of it.

By the last quarter of the 20th century, most people had seen a key aspect of Marx and Engel’s analysis disproved. The celebrated bearded communists had argued that capitalism would reduce all of society to only two classes: the prosperous bourgeoisie, who owned the capital, and the impoverished proletariat, who contributed their labor. Modern industrial production would inevitably depress the living standards of the proletariat, they believed, but also, in the end, increase their power. Having created a form of slavery, capitalism would be overthrown by its slaves. The proletarian masses would become the dictators.

This did not happen. Instead, the bourgeoisie grew so large that today it is commonplace for American politicians to speak of the “middle class” and mean much the same as people used to mean by “the workers.” In “The Communist Manifesto,” Marx and Engels refer to “the bourgeoisie, i.e., capital.” They scorned private property, pointing out that nine-tenths of the population had none. It did not cross their minds that the bourgeois class could be numerous enough to win elections in an era of universal suffrage; yet that is what happened. Margaret Thatcher also equated the bourgeoisie with property and capital, but she saw this as empowering the many, not the few.

In the 21st century, however, it is not surprising that many members of the middle class now see themselves as prisoners of the system that they helped to create. Phrases like “negative equity” and “credit crunch” capture that. A lot of words that have a specific economic or financial meaning also draw on a moral meaning—value, bonds, goods, security, even “collateralized debt obligations.” The word “credit” itself means “trust” or “belief.”

The relationship between money and morality, on which the middle-class order depends, has been seriously compromised over the past decade. Which means that the mass bourgeoisie (a phrase that Marx and Engels would have thought a contradiction in terms) start to feel like the new proletariat.

True, unemployment rates in the U.S. and Britain, unlike those in the eurozone, are low. Against most predictions, David Cameron’s Conservatives stayed in power in Britain, this time with an overall majority, in the general election in May. There was just enough financial prudence and just enough returning prosperity to see to that.

But pretty much the whole of the developed world is still in the convalescent ward, and no one is sure whether the wonder drug of quantitative easing can yet be abandoned, or even whether it does no more than suppress the symptoms of disease. Despite years of supposed austerity, debt is still strikingly high. It remains possible that banks, or even whole countries in the eurozone, could collapse. And who knows whether or not China’s big banks are bust?

There is clearly an unmet need for a politics that goes beyond mere grievance-peddling to develop a new way of thinking about what makes a society free and secure at the same time. If this were easy, we would have heard more of it by now, and I won’t pretend to have the answers. But certain basic principles seem like the proper foundation.

Look again at markets. “Capitalism” and “globalization” are words most commonly used by people who do not like the phenomena they describe. A better catchall term for the economic arrangements worth preserving is “markets,” and this should be emphasized. Markets provide the model for how goods should be exchanged in a free society—efficiently, amiably and under the rule of law.

To the extent that people cheat in markets, they are not real markets, any more than antifreeze labeled “wine” is real wine. Too many advocates of markets have allowed themselves to be suborned into becoming apologists for business. And too many businesses now operate as if their responsibilities are only to themselves and not to consumers.

Take ownership much more seriously. Why are so few companies owned by the people who work for them, and why do both liberal and conservative political parties not offer greater incentives, such as tax advantages, for this to change? It is extraordinary that the joint stock company, the foundation of modern commercial and industrial wealth, is still so little influenced by the views of shareholders.

This is perhaps most evident in the preposterous salaries paid, particularly in the U.S. and Britain, to top executives of public companies. If the owners of these companies truly exercised authority over what is theirs, this wouldn’t happen. If these enterprises had grown over the last 20 years at the same rate as pay for the men who run them (it usually still is men), no one would be talking of a crisis of capitalism.

Ownership of housing, stocks and pensions is an area where creativity has died. This failing of our consumer society may owe something to the baby boomers’ desire to “have it now,” but another part of the problem is that people are correctly no longer confident that what they save now will be available to them later. Savings need more long-term government protection than they receive in most Western societies. A business culture based on deals and bonuses means that the best business minds are not interested in saving.

The ideal of ownership also needs to apply more fully to civil society. It might be a good idea, for example, if citizens could establish ownership rights over their local school by becoming “members.” Under the existing arrangements, how much can parents and communities creatively affect what happens in schools? The charter-school movement in the U.S. and “academies” and “free schools” in Britain are working in the right direction but remain a long way from something citizens can feel they own.

These rights would give people a voice when things go wrong, rather as some congregations have a say in their churches. In Britain, there is an admirable and long-standing body called the Wine Society, wholly owned by its members with the sole purpose of getting them good wine at good prices. There could be some bold ideas about applying this principle to things so important that they can’t be bottled, such as health.

The Victorians were more imaginative than we are about principles of mutuality—credit unions, building societies, the cooperative movement. Such organizations feel creakier in an age when people want larger sums, faster. But is it really beyond the skill of our great modern business brains to develop these concepts and adapt them to modernity? Financial creativity, unfortunately, really has become the preserve of the few, for the few.

Balance the national and the global. This could be the hardest principle to implement but also the most important. All nations in the modern world depend on other nations and flourish if they embrace that interdependence—for the sake of trade and the sake of peace. But it does not follow, as some internationalists argue, that the age of the nation-state is dead.

Democracy and the rule of law exist only because of national jurisdictions. If those jurisdictions blur, as they do in the European Union, people’s trust in the polity weakens and the structures of answerability become too opaque. For all his love of trade, Adam Smith understood this. His great work is called “The Wealth of Nations,” not “The Wealth of the Global Community.”

Out of the allegiance that citizens feel to their country and its legal and political institutions comes the confidence to deal fairly with the wider world. The global village works best if each village householder is secure in his title to his own property and master in his own house. If the national and the global are not held in balance, popular fear of the global elites will (justifiably) grow. As happened in the 1930s, we will see weak, goody-goody international bodies wagging their finger ineffectually at strong, nasty nationalist regimes.

I am no alarmist, and no one should worry that I have become a late convert to Marxism. Marx’s prescriptions were mostly wrong, and his spirit was intolerant and coercive. He did not understand markets or respect political institutions, and he thought liberty was a sham.

But Marx did have an insight about the disproportionate power of the ownership of capital. The owner of capital decides where money goes, whereas the people who sell only their labor lack that power. This makes it hard for society to be shaped in their interests. In recent years, that disproportion has reached destructive levels, so if we don’t want to be a Marxist society, we need to put it right.

http://www.wsj.com/articles/the-middle-class-squeeze-1443194736?hubRefSrc=email&utm_source=lfemail&utm_medium=email&utm_campaign=lfnotification#lf_comment=393961026

We must think creatively about “how to make the middle class more prosperous and secure” is the theme of this article. And yes, the disproportionate power of the ownership of capital has reached destructive levels. The owners of capital assets decides where money is allocated, whereas the people who sell only their labor lack that power; they are propertyless in the sense of owning productive capital assets that create wealth and produce income. This makes it hard for society to be shaped so that EVERY child, woman, and man can become economically independent citizens.

To right this societal failure requires that the system be reformed to lift the barriers to equal economic opportunity and create a level playing field based on anti-monopoly and anti-greed fairness and balance between production and consumption. In so doing, every citizen can begin to accumulate over time into the future a viable capital estate without having to take away from those who now own by using the tax system to redistribute the income of capital owners. What the “haves” will lose is the productive capital ownership monopoly they enjoy under the present unjust system.

A key descriptor of such innovation is to find the ways in which “have nots” can become “haves” without taking from the “haves.” Thus, the reform of the “system,” as binary economist Louis Kelso postulated, “must be structured so that eventually all citizens produce an expanding proportion of their income through their privately owned productive capital and simultaneously generate enough purchasing power to consume the economy’s output.”

What we really need in this 2015-2016 presidential election period is a national discussion on the topic of the importance of capital ownership and how we can expand the base of private capital ownership simultaneously with the creation of new physical capital formation, with the aim of building long-term financial security for all Americans through accumulating a viable capital estate.

We need a recognition in America that we should deliberately begin to broaden the capital ownership base in a way that is consistent with the laws of property and the Constitutional safeguards of the rights of men and women to own property and be productive.

What needs to be our focus is to adjust the opportunity to produce, not the redistribution of income after it is produced.

The government should acknowledge its obligation to make productive capital ownership economically purchasable by capital-less Americans (the 99 percent) using insured, interest-free capital credit, and, as Kelso stated, “substantially assume financial responsibility for the economy through establishing and supervising the implementation of an economic, labor and business policy of democratized economic power.” Historically, capital has been the primary engine of industrialization. But as used, as Kelso has argued, has, as well, “been the chief cause of the institutional deformities that have created and maintained two incompatible classes: the overcapitalized and the undercapitalized.”

We need to arrive at a new market economy structure in which on one level the employees of a corporation could walk into management and demand, in collective bargaining, the use of a justice-based managed full-voting, full-dividend-earnings-payout Employee Stock Ownership Plan (ESOP)—not just to trade a single block of stock for wage concessions, but to redesign the future of the company and its employees. We need, as a society, the assurance that as a corporate employer grows, it builds ownership into its employees. All of them as individuals, not just the upper management, and not collectively!

When people are in a position to earn the income produced by their physical capital as well as the wages of their labor, their company is in a position to be more competitive through lower labor costs and increased technological invention and innovation, while achieving higher employee incomes through the employee-owned productive capital.

Once this goal becomes the national political focus we will see an unbelievable discussion of workable plans to realize the goal. Remember that planning begins with a vision and a goal.

This is not rocket science but it does require national leadership. Implementation requires amending a few laws that basically authorize the transactions that will broaden capital ownership paid for with the future earnings of capital investment. Allowing such transactions will provide incentives for profitable opportunities to employ unused capacity and promote stable and robust economic growth.

Still, after a half-century, we have no leaders with a growth strategy that could restore the economic productiveness of the American economy. The growth strategy I have presented is not new, but it has not yet registered in the minds of leaderless politicians and their advisors from the left to the right of the political spectrum and a population of people who have been mis-educated and mis-led by conventional economists from all the conventional schools of economics.

Economist John Maynard Keynes, whose Keynesian model is widely taught, falsely presumed that the only way to balance mass productive power with mass purchasing power is through a wage system––ignoring the possibility of democratizing future ownership of labor-displacing productive capital technologies and rising ownership incomes as a market-generated means of eliminating wage slavery, welfare slavery, debt slavery and charity slavery for the 99 percent of humanity.Kelso argued that the Keynesian model fails to recognize that “when capital workers [owners] replace labor workers as the major suppliers of goods and services, labor employment alone becomes inadequate because labor’s share of the income arising from production cannot provide the progressively better standard of living that technology is making possible. Labor produces subsistence at best. Capital can produce affluence. To enjoy affluence, all households must engage to an increasing extent in capital work.”

It is imperative that leaders seeking new solutions cease the opportunity presented by the 2015-2016 presidential election to implement effective programs for expanded ownership of productive capital, and address the problem of education on this subject.

One of my favorite Kelso quotes is: “The low credibility of government and of all lesser institutions in America today is a consequence of our own increasingly hollow democracy. It is reflected in the rising domestic crime rate and the social and political alienation of people in all walks of life, except for the rich and their sycophants.

The real collapse of American ideological leadership in the world can best be seen in the feebleness and confusion that characterizes American foreign policy. The handwriting on the wall is clear: America must rethink the meaning of democracy and set about within its borders to rationalize its economic policy into one that synchronizes the shift from labor intensive to capital intensive production, with universal capital ownership and the payment of the full wages [earnings] of capital to capital owners, so to restore economic democracy to our economy. We should democratize our plutocratic capitalist economy before we preach democracy to others.”

At one point in 1976, the discussion led to The Joint Economic Committee of Congress endorsing the two-factor policy to broaden capital ownership as an economic goal for America.

The 1976 Joint Economic Report stated: “To provide a realistic opportunity for more U.S. citizens to become owners of capital, and to provide an expanded source of equity financing for corporations, it should be made national policy to pursue the goal of broadened capital ownership. Congress also should request from the Administration a quadrennial report on the ownership of wealth in this country, which would assist in evaluating how successfully the base of wealth was being broadened over time.” Unfortunately the Congress has never paid any attention to this policy, and the goal has subsequently been unacknowledged and unheeded by our plutocratic political leaders.

The stark reality is that we are in a depression reflected in rising “real” (not statistical) unemployment and underemployment and instability that we will never escape from until we change our economic policy.

Increasingly, more Americans will not be able to ever purchase a home, due to the packed inflationary wage and welfare base factored into the cost of building homes, which inflate prices, and will be forced to rent their entire life or depend on government living assistance––not able to accumulate equity that can help to sustain them in their retirement years. And this is the new reality now facing people in the middle class. The uncertainty of holding onto a good job is frightening to an increasingly wider base of middle-class working citizens. When you factor in the average non-salaried worker, even with a government-mandated minimum labor wage rate of $10.00+ per hour in some states and cities, the outcome is grim. Never mind that consumer demand continues to dwindle because of insufficient income, solely tied to labor worker wages.

The impact of the decline in consumer demand due to declining labor worker wages is that production will decline or desist without sustainable consumer demand. Furthermore, those corporations growing the economy, both nationally and globally, will expand globally with investment in new productive capital projects and seek “customers with money” abroad.

This is all coming about because we have severely mismatched the power to produce with the possession of unsatisfied needs and wants. Those capital owners who have unsatisfied needs and wants have ready access through conventional finance to get as much or more productive capital as they want. Our tax laws are designed to further benefit the 1 percent by providing enormous write offs and credits to producers (corporations) who are owned by the few, who already produce more than they can consume.

Those who have only their labor power and its precarious value held up by coercive rigging and who desperately need capital ownership to enable them to be capital workers as well as labor workers to have a way to earn more income, cannot satisfy their unsatisfied needs and wants. With only access to labor wages, the 99 percenters will continue, in desperation, to demand more and more pay for the same or less work, as their input is exponentially replaced by productive capital.

But if we change direction and systematically build earning power into consumers, we have the opportunity to reverse the depression perpetrated by systematically limiting the 99 percent to labor wages alone and through technology eliminating their jobs. We need solutions to grow the economy in ways that create productive jobs and widespread equity sharing.

We need to systematically make insured, interest-free capital credit to purchase capital accessible to economically underpowered people (the 99 percenters) in which the income from the capital investment is isolated until it pays for itself, and then begins to produce a stream of dividend income to the new capitalists. This can only be accomplished by enabling every person to have access to capital ownership and purchase the capital, and pay for it out of what the capital produces. It’s time good and well-intentioned people woke up and adopted a Just Third Way paradigm (http://cesj.org/learn/just-third-way/) beyond the greed model of monopoly, “hoggist” capitalism and the envy model of the traditional welfare state. This will promote peace, prosperity, and freedom through harmonious justice.

Bernie Sanders And Elizabeth Warren Attack Predatory Wall Street Bankers

sanders warren

As Wall Street bankers and fund investors continue making a profit at the expense of Puerto Rico’s failing economy, Senators Warren and Sanders are calling for the Treasury to show more leadership and give the people the relief they need.

On October 24, 2015, Andrew Emett writes on Nation of Change:

At a committee hearing on Thursday, Sens. Bernie Sanders and Elizabeth Warren accused Wall Street bankers and fund investors of bleeding Puerto Rico’s economy dry in an attempt to maximize returns on high interest rates. Instead of recklessly driving Puerto Rico further into crippling debt, Sanders and Warren have called for these financial institutions to allow Puerto Rico to restructure its debt in a way that protects residents, ordinary investors, and pension funds in the U.S.

“The economic situation in Puerto Rico will not improve by eliminating more public schools, slashing pensions, laying off workers, and allowing corporations to pay workers starvation wages by suspending the minimum wage and relaxing labor laws – you simply cannot get blood out of a stone,” Sanders said during the Energy and Natural Resources Committee hearing. “I find it morally repugnant that vulture funds and Wall Street investment banks have been calling for even more austerity in Puerto Rico. In my view, the people in Puerto Rico should not be forced to suffer even more so that a handful of wealthy investors can make a 100 percent return on their investments.”

“They want Puerto Rico to raise taxes, cut health care, fire teachers, cut pensions, sell off $4 billion worth of government buildings, privatize public ports, close neighborhood schools, and cut support for the University of Puerto Rico, all so these vulture funds can squeeze out more profit,” Warren added.

In a letter sent Wednesday to U.S. Treasury Secretary Jacob Lew, Sanders wrote, “Since 2006, Puerto Rico has lost 20 percent of its jobs. About 60 percent of Puerto Rico’s adult population are unemployed or are not looking for work. Over the last five years alone, more than 150 public schools have been shut down, and the childhood poverty rate has shot up to 56 percent. At a time when the rich are getting richer, Puerto Rico now has more income inequality than any U.S. state.”

In his letter, Sanders requested that Secretary Lew meet with Puerto Rican officials, conduct a transparent audit of Puerto Rico’s debt, ensure the territory is given the same bankruptcy protections as cities in the U.S., and increase the level of federal dollars Puerto Ricans receive for health care.

“Treasury needs to step up and show more leadership here,” Warren asserted. “When the banks were in trouble, Treasury did a lot more than just bail them out. Treasury stretched the limits of its authority to make sure that the banks stayed afloat. It helped broker deals between banks. It applied pressure to get parties to accept deals they may not have liked very much.”

“Now the people of Puerto Rico are calling. They understand there is no bailout on the table for them and they are not asking for one. After all, they aren’t a giant bank. But they are asking the administration to do what they can do what it can to help broker deals to stand up to the vulture funds,” Warren continued.

As Wall Street bankers and fund investors continue making a profit at the expense of Puerto Rico’s failing economy, Sanders noted, “They are receiving 11 percent [interest rates] and children in Puerto Rico are going hungry – somehow that equation does not make a lot of sense to me. They made risky investments. And when you make a risky investment, you should not expect to get 100 percent back on your dollar.”

http://www.nationofchange.org/2015/10/24/bernie-sanders-and-elizabeth-warren-attack-predatory-wall-street-bankers/

Bernie Sanders: ‘Stand Up To Corporate America’

Senator Bernie Sanders of Vermont spoke at the Democratic Party’s Women’s Leadership Forum, urging the audience to stand up to corporate America and “the billionaire class.”

By REUTERS on Publish DateOctober 23, 2015. Photo by Mark Wilson/Getty Images.

Own the Future Economy or Be Owned!
 
From Robert Reich: “Yesterday, Bernie provided a clear argument about why we must “stand up to corporate America.” I’ll paraphrase (and throw in a bit of my own assessment as well): Virtually all the political power in our society is now in the hands of large corporations, Wall Street, and a handful of politically-active billionaires — who possess that power by virtue of the money they’re pouring into campaigns, lobbying, and propaganda. That power tilts the economy ever further in their direction — through changes in the rules of the game that help them and hurt most others, including average workers and small businesses. And as the economy tilts in their direction, they take even more of the economy’s gains — enabling them to increase their political power. It’s a vicious cycle that can only be reversed if we stand up that power directly.
 
What do you think?”

Bernie Sanders Wants To Bring Back Your 40-Hour Workweek

On October 24, 2015, Arthur Delaney writs on The Huffington Post:

Democratic presidential candidate Sen. Bernie Sanders (I-Vt.) thinks Americans may have forgotten about the 40-hour week.

“A hundred years ago workers took to the streets” to fight for 40 hours, Sanders told The Huffington Post. “And a hundred years have come and gone, we’ve seen an explosion in technology, we’ve seen an explosion in productivity, we have a great global economy, and what do you have? The vast majority of people are working longer hours for lower wages.”

American workers with full-time jobs work an average of 42.7 hours per week, according to thelatest data from the Bureau of Labor Statistics. Including part-timers in the calculation puts the average American workweek at 39 hours.

Sanders said he wants to appropriate the term “family values” from Republicans, who have historically used it to talk about social issues, and use it to promote legislation mandating paid vacation, paid sick days and paid parental leave for U.S. workers. Just 11 percent of workers had access to paid leave to care for newborns in 2012, according to the BLS.

“What the Republicans talk about when they speak of family values is to deny a woman the right to control her own body, to deny a woman the right to get contraceptives, opposition to gay rights and gay marriage,” Sanders said. “I don’t think those are family values.”

Last week Sanders introduced a bill that would require employers to give at least 10 paid vacation days annually to any employees who have worked at the company for at least a year.

“What our legislation says — and we think this is absolutely a family value — is that a mom and a dad should have the right to at least a couple of weeks off of paid vacation so they can spend quality time with their kids,” Sanders said.

Republicans control Congress, and they aren’t keen on shortening work hours. They have complained bitterly, for instance, that President Barack Obama’s health care law undermines the 40-hour week. The Congressional Budget Office reported in 2014 that the Affordable Care Act could result in some Americans choosing to work less because they could get health insurance without being tied to a full-time job.

American workers did indeed fight and die for shorter hours, which for a long time was the foremost demand of the labor movement. The shorter hours movement culminated in the Fair Labor Standards Act of 1938, a federal law that established the minimum wage and requires employers to give workers extra pay when they work more than 40 hours per week. The effectiveness of the law has eroded, however, because the law only protects salaried workers earning less than $23,660 per year.

“What that means if you were a quote-unquote supervisor at McDonald’s, making $25,000 a year, $28,000 a year, and you are supervising some other people flipping hamburgers and you’re working 50 or 60 hours a week, you do not get overtime,” Sanders said.

Sanders and other Democrats have asked Obama to consider raising the salary threshold so it covers more workers, something the White House is currently considering. Sanders wants to see the threshold set at $57,000.

“That means everybody making under that would get time and a half when they work more than 40 hours a week,” he said. “Very important step forward.”

http://www.huffingtonpost.com/entry/bernie-sanders-40-hour-workweek_562b8942e4b0aac0b8fd182a?ncid=txtlnkusaolp00000592&ref=yfp

The underlying reason that people who are employed are working longer hours for less wages is because they are OWNED by their ownership-class employers, who advantage themselves with the threat of layoffs and firings. In essence, increasingly workers are forced to take lower wages and work longer hours or they face termination.

While working conditions for the labor force have, of course, improved over the years, the economic quality of life for the majority of Americans has trailed far behind the technical capabilities of the economy to produce creature comforts, and even further behind the desires of consumers to live economically better lives. The missing link is that most of those unproduced goods, products and services can be produced only through the non-human means of production––physical capital––and the people who need wealth-creating, income-producing capital assets have no opportunity to earn income from capital ownership. Thus, they remain wage slaves, welfare slaves, consumer debt slaves and charity slaves.

The stark reality is that we are in a depression reflected in rising “real” (not statistical) unemployment and underemployment and instability that we will never escape from until we change our economic policy. Increasingly, more Americans will not be able to ever purchase a home, due to the packed inflationary wage and welfare base factored into the cost of building homes, which inflate prices, and will be forced to rent their entire life or depend on government living assistance––not able to accumulate equity that can help to sustain them in their retirement years. And this is the new reality now facing people in the middle class. The uncertainty of holding onto a good job is frightening to an increasingly wider base of middle-class working citizens. When you factor in the average non-salaried worker, even with a government-mandated minimum labor wage rate of $10.00+ per hour in some states and cities, the outcome is grim. Never mind that consumer demand continues to dwindle because of insufficient income, solely tied to labor worker wages. The impact of the decline in consumer demand due to declining labor worker wages is that production will decline or desist without sustainable consumer demand. Furthermore, those corporations growing the economy, both nationally and globally, will expand globally with investment in new productive capital projects and seek “customers with money” abroad.

This is all coming about because we have severely mismatched the power to produce with the possession of unsatisfied needs and wants. Those capital owners who have unsatisfied needs and wants have ready access through conventional finance to get as much or more productive capital as they want. Our tax laws are designed to further benefit the 1 percent by providing enormous write-offs and credits to producers (corporations) who are owned by the few, who already produce more than they can consume. Those who have only their labor power and its precarious value held up by coercive rigging and who desperately need capital ownership to enable them to be capital workers as well as labor workers to have a way to earn more income, cannot satisfy their unsatisfied needs and wants. With only access to labor wages, the 99 percenters will continue, in desperation, to demand more and more pay for the same or less work, as their input is exponentially replaced by productive capital.

But if we change direction and systematically build earning power into consumers, we have the opportunity to reverse the depression perpetrated by systematically limiting the 99 percent to labor wages alone and through technology eliminating their jobs. We need solutions to grow the economy in ways that create productive jobs and widespread equity sharing. We need to systematically make insured, interest-free capital credit to purchase capital accessible to economically underpowered people (the 99 percent) in which the income from the capital investment is isolated until it pays for itself, and then begins to produce a stream of dividend income to the new capitalists. This can only be accomplished by enabling every person to have access to capital ownership and purchase the capital, and pay for it out of what the capital produces. It’s time good and well-intentioned people woke up and adopted a Just Third Way paradigm (http://cesj.org/learn/just-third-way/) beyond the greed model of monopoly, “hoggist” capitalism and the envy model of the traditional welfare state. This will promote peace, prosperity, and freedom through harmonious justice.

Bernie Sanders: The Time Has Come For Real Change

On October 21, 2015, Senator Bernie Sanders writes on The Monitor:

The American people understand that our current economic system is rigged, and that our campaign finance system is corrupt. They know that while the very rich get much richer, millions of Americans work longer hours for lower wages, and we have the highest rate of childhood poverty of almost any major country on Earth.

In the last 30 years there has been a massive redistribution of wealth in the United States. Unfortunately, it has gone in the wrong direction. Trillions of dollars have flowed from the pockets of working families into the bank accounts of the top 1 percent. Meanwhile, billionaires and large corporations continue to exploit tax loopholes their lobbyists created, while Republican presidential candidates fight for even more tax breaks for the people who need them the least.

Now is the time for bold action to rebuild our disappearing middle class. Now is the time to protect the most vulnerable members of our society – the elderly, the disabled and the children. Now is the time to demand that the wealthiest people in our country and the largest corporations accept their responsibilities as Americans and pay their fair share of taxes.

How many of our nation’s seniors would be living in poverty and without health insurance if FDR and LBJ listened to those who said we couldn’t afford Social Security and Medicare? What would our transportation system look like if Eisenhower did not invest in building the interstate highway system?

We are a much greater nation because these presidents took on powerful special interests and acted on behalf of the American people. That’s what we have to do today.

When a college degree is now as important as a high school degree was 50 years ago, it is time to make public colleges and universities tuition free. It is unconscionable that hundreds of thousands of bright young people are unable to get a higher education today because their families lack the funds. It is absurd that millions of Americans struggle to pay off their student debt with outrageously high interest rates.

Providing free tuition at public colleges and universities, and lowering interest rates on student loans is not an inexpensive proposition. My proposal is paid for by a tax on Wall Street speculation.

Today, in virtually every part of our country, our roads, bridges, water systems, railways, airports, levees and dams are crumbling. We can create and maintain at least 13 million jobs by rebuilding our infrastructure through a trillion dollar investment over five years. My Rebuild America plan is fully paid for by ending tax loopholes that allow multi-national corporations to stash their profits in the Cayman Islands and other tax havens and, in some years, pay nothing in federal income tax.

At a time when millions of seniors and disabled people are trying to survive on incomes of $12,000 or $13,000 a year, we must resist Republican efforts to cut Social Security. In fact, we need to extend the solvency of Social Security so that it is there for our kids and grandchildren, and expand it to make sure every American can retire in dignity.

Today, the very wealthy contribute the same amount into the Social Security Trust Fund as someone earning $118,500 a year. That’s wrong. My proposal to extend and expand Social Security is paid for by doing what Barack Obama proposed in 2008 – lifting the payroll tax cap on all income above $250,000. This would extend the solvency of Social Security until 2065; expand benefits by an average of about $65 a month; increase cost-of-living-adjustments; and lift the lowest income beneficiaries out of poverty.

At a time when the United States has more people in jail than any other country on Earth, disproportionately black and Latino, we need to invest in education and jobs for our young people, not in more jails and incarceration. My Employ Young Americans Now Act would create 1 million jobs for disadvantaged youth over the next two years and provide job training to hundreds of thousands of young adults. We pay for that by closing a loophole allowing hedge fund managers to pay a lower tax rate than a truck driver or a nurse.

When the United States is the only major country on Earth that does not guarantee health care for all or paid family and medical leave, we must end that international embarrassment. A Medicare for all single-payer health care system would be less expensive than our current for-profit health care system, and would also bring about a substantial reduction in the price of prescription drugs. We pay for family and medical leave with a very modest increase in the payroll tax.

https://politics.concordmonitor.com/2015/10/opinion/my-turn-the-time-has-come-for-real-change/

My comment on this article is to address the critical economic issue of earning an income, which when insufficient creates problems for individuals and families, who then cannot be self-sufficient, financially responsible or supportive of the needs of their families and themselves.

Since forever, the prevailing view of the economic world by the vast majority of people has been shaped by the narrow perspective that “a job is the ONLY way to earn an income.” Of course, this is what Americans have been taught to believe, while the real path to earning a significant income is through OWNING wealth-creating, income-producing capital assets––the non-human assets that are the product of exponential technological invention and innovation such as productive land, structures, tools, machines, super-automation, robotics, computerization, etc. Yet, no one EVER addresses this means to earning an income, even though the majority of politicians, national media spokespersons, CEO and the wealthy owe their wealth to OWNING productive capital assets.

I will exclude Senator Bernie Sanders because he does recognize the benefits of worker cooperatives and Employee Stock Ownership Plan (ESOP) structured corporations. But hopefully, Bernie Sanders will expand his thinking and advocate in addition to workers OWNING their companies using worker cooperative and ESOPs to also support the proposed Capital Homestead Act, which would empower EVERY citizen to become a capital owner, just like today’s wealthy ownership class.

We can no longer depend on jobs to earn incomes sufficient to support individuals and families. Even a massive infrastructure update effort will last only a short time and once the construction project are completed the jobs will ceased to exist.

Job opportunities for the vast majority of Americans are drying up, especially those that pay a decent wage to support a middle class lifestyle. This is due to tectonic shifts in the technologies of production in which the non-human factor is replacing humans in production and thus destroying jobs, and globalization in which production is being outsourced to low wage and non-regulated foreign countries as more and more American corporations, driven by competition and an American consumer who seeks the lowest cost for products and services.

While our government continues to pursue “free trade” agreements with such low wage and non-regulated countries, the consequence of such efforts is to further undermine opportunities for Americans to secure good-paying jobs. At the same time, it is the already wealthy ownership class that benefits from the elimination of tariffs as the corporations they OWN further invest in productive capital asset formation in foreign countries to gain advantages in labor cost reduction and the lack of operational environmental regulation.

What our government should be doing is imposing robust import levies and tariffs (tax) on particular classes of imports that are determined to be manufactured outside the United States and exported back to the United States that do not qualify as “Fair Trade” and unfairly undercut an American-make equivalent. At present, American business corporations are increasingly abandoning the United States and its communities to invest in productive capital formation outside the United States, particularly in China, Mexico, India, and other parts of Asia, supported by American consumers who cannot afford pricier American-made products. As a result, America is experiencing the deindustrialization of America. This has forced policy makers to adopt a redistributive socialist solution rather than a democratic capitalist one whereby democratic economic growth of the earning power of the citizens would flourish simultaneously with new, broadly-owned productive capital formation investments in the United States. Such overseas operations have the advantage of “sweat-shop” slave labor rates relative to American standards, low or no taxation, supportive infrastructure provisions, currency manipulation, and few if any environmental regulations––which translate to lower-cost production. Thus, producing the same product or service in the United States would be far more expensive. For most people, economic globalization means a growing gap between rich and poor, technological alienation of the labor worker from the means of production, and the phenomenon of global corporations and strategic alliances forcing labor workers in high-cost wage markets, such as the United States, to compete with labor-saving capital tools and lower-paid foreign workers. Unemployment is high and there is an accelerating displacement of labor workers by technology and cheaper foreign labor, resulting in greater economic uncertainty and unstable retirement incomes for the average American citizen––causing the average citizen to become increasingly dependent on government wealth redistribution programs.

In addition to tariffs the necessity is to adopt economic policies that will stimulate the America economy to grow while simultaneously creating new capital asset OWNERS.

The government should acknowledge its obligation to make productive capital ownership economically purchasable by capital-less Americans (the 99 percent) using insured, interest-free capital credit, and, as binary economist Louis Kelso stated, “substantially assume financial responsibility for the economy through establishing and supervising the implementation of an economic, labor and business policy of democratized economic power.” Historically, capital has been the primary engine of industrialization. But as used, as Kelso has argued, has, as well, “been the chief cause of the institutional deformities that have created and maintained two incompatible classes: the overcapitalized and the undercapitalized.”

We need to arrive at a new market economy structure in which on one level the employees of a corporation could walk into management and demand, in collective bargaining, the use of a justice-based managed full-voting, full-dividend-earnings-payout ESOP (Employee Stock Ownership Plan)—not just to trade a single block of stock for wage concessions, but to redesign the future of the company and its employees. We need, as a society, the assurance that as a corporate employer grows, it builds ownership into its employees. All of them as individuals, not just the upper management, and not collectively! When people are in a position to earn the income produced by their physical capital as well as the wages of their labor, their company is in a position to be more competitive through lower labor costs and increased technological invention and innovation, while achieving higher employee incomes through the employee-owned productive capital.

Once this goal becomes the national political focus we will see an unbelievable discussion of workable plans to realize the goal. Remember that planning begins with a vision and a goal. This is not rocket science but it does require national leadership. Implementation requires amending a few laws that basically authorize the transactions that will broaden capital ownership paid for with the future earnings of capital investment. Allowing such transactions will provide incentives for profitable opportunities to employ unused capacity and promote stable and robust economic growth.

Still, after a half-century, we have no leaders with a growth strategy that could restore the economic productiveness of the American economy. The growth strategy I have presented is not new, but it has not yet registered in the minds of leaderless politicians and their advisors from the left to the right of the political spectrum and a population of people who have been mis-educated and mis-led by conventional economists from all the conventional schools of economics.

Hopefully Bernie Sanders will be the exception and see the merits in empowering EVERY citizen to become a capital OWNER.