Author: Tony Wikrent Page 6 of 43

by Tony Wikrent

Strategic Political Economy

What is the deep state? (YouTube video)

(Jeffrey Sachs, John Mearsheimer, YouTube, via Thomas Neuburger, God’s Spies, 09-20-2024]

This video segment is taken from a symposium at which Sach and Mearsheimer offered their views on U.S. foreign policy. The whole thing is worth a listen, but I’ve cued this to start at the point where the question, “What is the deep state?” is asked and answered.

Note: The answer relates to foreign policy only, not the broader question of “Does the Establishment State try to influence domestic politics?”

“Sachs: My experience … is that there’s a deeply entrained foreign policy. It has been in place in my interpretation for many decades. But arguably a variant of it has been in place since 1992. I got to watch some of it early on because I was an adviser to Gorbachev and I was an adviser to Yeltsin, and so I saw early makings of this though I didn’t fully understand it except in retrospect.

“But that policy has been mostly in place pretty consistently for 30 years, and it didn’t really matter whether it was Bush Senior, whether it was Clinton, whether it was Bush Jr., whether it was Obama, whether it was Trump.

“After all, who did Trump hire? He hired John Bolton. Well, duh, pretty deep state. That was the end of … they told, you know, he [Bolton] explained this is the way it is. And by the way, Bolton explained also in his memoirs, when Trump didn’t agree we figured out ways to trick him basically.”

….

“MEARSHEIMER: When we talk about the ‘Deep State,’ we’re really talking about the Administrative State. It is very important to understand that starting in the late 19th and early 20th century, given developments in the American economy, it was imperative that we develop — and this is true of all Western countries — a very powerful central state that could ‘run the country.’ And over time, that state has grown in power.

“Since World War Two, the United States has been involved in every nook and cranny of the world, fighting wars here, there, and everywhere. And to do that, you need a very powerful administrative state that can help manage that foreign policy. But in the process, what happens is you get all of these high-level, middle-level, and low-level bureaucrats who become established in positions in the Pentagon, the State Department, and the intelligence community — you name it. And they end up having a vested interest in pursuing a particular foreign policy.

“That particular foreign policy that they like to pursue is the one the Democrats and the Republicans are pushing. That’s why we talk about tweedle-dee and tweedle-dum with regard to the two parties. You could throw in the deep state as being on the same page as those other two institutions….”

[TW: This is an important glimpse into the thinking of USA ruling elites. But just as important as what was said, is what was not said. There was no discussion of cooperation between nations on solving global problems, in line with what I have identified as a core principle of civic republicanism: one major role of government is to encourage people to do good by increasing humanity’s power over nature. There was no mention whatsoever of climate change, which absolutely will require global cooperation, probably on an unprecedented level. How about an international effort to help Mexico build a second Panama Canal? Or a crossing of the straits of Gibraltar, now considered an insurmountable engineering challenge. Wouldn’t it be much better to focus energies and resources on such projects?

[Increasing humanity’s power over nature: that’s what sewer systems and water distribution systems did — projects which are probably the single largest factor in tripling average human life expectancy in the past three centuries. Sewer systems and water distribution systems are primary examples of increasing humanity’s power over nature. Not just power over flows of water, but power over the spread of bacteria and viruses.

[The “realism” discussed by Sachs and Mearsheimer emphasizes competition — just like neoliberal “free market” economics. The real way to avoid nuclear war is to emphasize the cooperation of the human family in solving the problems we call face. The old paradigms of thought must be banished and replaced. For example, the idea that economics is about how “society allocates scarce resources” (taught in all “classical economics” texts and courses in the West), must be replaced by the understanding of civic republican political economy that the foremost economic task of any society is to overcome scarcity and provide abundance by increasing the power of humanity to understand and prudently control natural resources, then to distribute that abundance equitably to all of humanity. One major international cooperative project that cries out for attention and support is to build sewer systems and water distribution systems throughout the entire world, most especially areas in Africa and South American which do not now have them. There should not be any people anywhere on the globe who are forced to spend large parts of their day filling the basic need of securing enough clean water to drink, bathe, and cook.

[Eight years ago, China proposed an international $50 trillion project to build an electric power grid to bring solar and wind generated electricity from the polar and equatorial regions of the world, to the more populated regions that use the electricity. It is a great strategic mistake to ignore such proposals. ]

Global power shift

China leads world in 57 of 64 critical technologies; up from 3 just 20 years ago 

[Hacker News, via Naked Capitalism 09-21-2024]

ASPI’s two-decade Critical Technology Tracker 

[ASPI, via Naked Capitalism 09-21-2024]

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by Tony Wikrent

Russia / Ukraine

Russia will be ‘at war’ with NATO if Ukraine long-range missile restrictions lifted, Putin warns

Avery Schmitz and Michael Conte, September 13, 2024 [CNN]

Russian President Vladimir Putin has warned NATO alliance leaders that a move to lift restrictions on Ukraine’s use of longer-range Western missiles to strike deep inside his country would be considered an act of war.

“This will mean that NATO countries – the United States and European countries – are at war with Russia. And if this is the case, then, bearing in mind the change in the essence of the conflict, we will make appropriate decisions in response to the threats that will be posed to us,” Putin told reporters on Thursday.

 

Putin says NATO will be “in the war” if U.S. or allies let Ukraine fire long-range missiles at Russia

Haley Ott,  September 13, 2024 [CBS News]

Russian President Vladimir Putin warned Thursday that a decision by the U.S. or its NATO allies to allow Ukraine to use Western-supplied long-range missiles to hit targets deep inside Russia would be viewed as NATO’s direct participation in the war, which he said would significantly change “the very nature of the conflict.”

“Flight assignments for these missile systems can, in fact, only be entered by military personnel from NATO countries. Ukrainian servicemen cannot do this. And therefore, it is not a question of allowing the Ukrainian regime to strike Russia with these weapons or not. It is a question of making a decision whether NATO countries directly participate in the military conflict or not,” Putin said in response to a question on Thursday.

“If this decision is made, it will mean nothing less than the direct participation of NATO countries, the United States, and European countries, in the war in Ukraine,” the Russian leader added.

Strategic Political Economy

Master Plan, Ep 5: How Corporations Became People

David Sirota and The Lever staff, September 10, 2024 [The Lever]

In Master Plan’s fifth episode, we explore how an unlikely catalyst — Robert Kennedy’s 1968 assassination — created an opportunity for his Senate replacement to manufacture the first and perhaps most important blow against America’s new campaign finance laws: Buckley v. Valeo. With a supporting cast including James Buckley, John Bolton, Charles Koch, and Robert Bork, this U.S. Supreme Court case was the first to frame the fight against campaign finance regulations as a crusade for free speech and third-party rights.

The master planners were just getting started. While Buckley v. Valeo blew the lid off limits to certain kinds of campaign expenditures, Big Business also wanted to ensure that corporations could spend as freely as their human counterparts. This is where the master planners’ sleeper agent on the Court, Justice Lewis Powell, would work behind the scenes to deliver an expansive ruling that created the foundation for Citizens United.

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by Tony Wikrent

Strategic Political Economy

Justice Alito reports German princess gave him $900 concert tickets

Associated Press, September 06, 2024 [via DailyKos]

Justice Samuel Alito reported Friday that he accepted $900 worth of concert tickets from a German princess, but disclosed no trips paid for by other people, according to a new financial disclosure form.

The required annual filing, for which Alito has often sought an extension, doesn’t include details of the event tickets gifted by socialite Gloria von Thurn und Taxis of Germany….

[TW: I begin with seemingly innocuous news item because it bears directly on today’s condition of  political culture in USA. The rest of the Associated Press story lists a number of other gifts and courtesies Justice Alito has accepted, and sees nothing else peculiar in the gift by Gloria von Thurn und Taxis.

[Now, Article I, Section 9 of the Constitution:

No Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.

[I am not going to write anything more on this Section other than to note its obvious importance as part of the Constitution of a republic in a world dominated and mostly ruled by monarchies and oligarchies. What I want to draw attention to are some of the comments in the DailyKos story:

Sep 06, 2024 at 06:36:03 PM  — WTF is a German Princess?

Sep 06, 2024 at 06:40:10 PM —Germany hasn’t been a monarchy for more than 100 years….

Sep 06, 2024 at 06:46:09 PM — Germany still has princesses?

[Ganesh Sitaraman makes the very astute observation in his 2017 book, The Crisis of the Middle-Class Constitution: Why Economic Inequality Threatens our Republic that Americans’ historic dislike of monarchies began to disappear after World War Two, when nazism, fascism, and communism came to be perceived as greater threats than oligarchy, and USA elites embraced a “special relationship” with the United Kingdom. To this day, the largest embassy by far in Washington DC is the British.

[But the threats of oligarchy and monarchy did not actually recede; they merely disappeared in the shadows cast by the Cold War. Very few people wondered what had become of the vast fortunes controlled by the former oligarchs of Europe. Perhaps people did not want to ask such potentially embarrassing questions of our new-found anti-communist allies.

[Thurn und Taxis is one of the oldest and nastiest of the European “black nobility.” In the 15th through 18th centuries, the family became one of the richest in the world by operating the postal service used by Europe’s royal families to communicate with each other. In 2017, the family’s net worth was estimated at around $ 2.5 billion,  “including the largest privately owned forests in Europe.” Gloria married into the family by wedding Johannes. Their son, Albert, was, at age eight, one of the youngest people ever recorded as a billionaire when Johannes died, leaving Albert sole designated heir of a $3 billion fortune.

[The nephew of Johannes was Max Thurn. He was a major power in the Mont Pelerin Society, serving as secretary from 1976 to 1988. This is the period in which the Mont Pelerin Society’s economic “neoliberalism” became entrenched in power under Thatcher in Britain and Reagan in USA. The past half century of economic “neoliberalism” has pauperized the working class, destroyed the middle class, and enriched only elites, creating the social conditions in which right wing reactionaries thrive.

[It is a tragedy that the USA public and media are largely ignorant of the bloody history of European oligarchs, and fail to make the connection between inherited wealth, the continued existence of oligarchs like Thurn und Taxis, and the collapse of representative democracies around the world. The corruption of US Supreme Court Justice Alito is just a recent case in point.

[The social milieu Justice Alito is apparently comfortable in should certainly be of great public interest, and even, I strongly suggest, of concern to any intelligence agency that seriously understands the importance of maintaining the United States as a republic.  Another comment from the DailyKos story:

Sep 07, 2024 at 01:09:34 PM — Back in the 1980’s I spent the afternoon with the “Kiser Apparent” of Germany while working as an archaeologist for the “very rich”. The “Prince” owned catfish farm in Texas. The rich kissed his ass.

[Theorists of civic republicanism warned about the corrupting influence of wealth and luxury. That’s one reason why Section 9 was written. Now consider Donald Trump and who is mentor was:

Aside From The Ones Living In Miami, Brooklyn and WeHo, Will Russians Get To See “The Apprentice?”

Howie Klein, September 07, 2024  [downwithtyranny.com]

Before Trump barged his way into the national consciousness, Roy Cohn was one of the worst villains of any American in our lifetimes— right up there with J. Edgar Hoover, Richard Nixon, Henry Kissinger and Joseph McCarthy… and on a par with historical miscreants like Jefferson Davis, Andrew Jackson, Nathan Bedford Forrest… A real master of corruption, Cohn built his hideous career by exploiting power, weaponizing fear and perverting the law. From his role as McCarthy’s right-hand man during the Red Scare— ruining countless lives through baseless accusations of communism— to his later years as a ruthless Mafia lawyer, Cohn epitomized everything vile about American greed and runaway ambition. With the exception of a small handful of delusional Republicans, his career is universally seen as a showcase of sociopathic disregard for ethics, and he is seen as a man who thrived on manipulation, blackmail… destruction. Most damning of all, Cohn mentored The Donald, passing along his amoral playbook to a demon who went on to wreak even more havoc on the country. So Cohn’s poisonous influence didn’t end with his death; it metastasized into the very heart of modern American politics.

And now there’s a film! Nick Schager’s preview for the Daily Beast noted that it’s the movie Señor T doesn’t want you to see— and for good reason… a damning film about the making of a monster… “a bona fide supervillain origin story.”

As you probably know by now, it’s “an incisive primer on the relationship with Roy Cohn that made the 45th President of the United States who he is today. Which is to say, it lays out the gory details regarding the source of his egomania, greed, ambition, vanity, sociopathy, and heartless rapey-ness, the last of which comes to the fore in a brutal assault of his first wife Ivana.”

When they first met, Cohn recognizes him “as a dreamer determined to do whatever it takes to be Rockefeller-grade rich, as well as something of an empty vessel into which he can pour all his evil. Pour he does, gradually taking Trump under his wing and indoctrinating him in the ways of unabashed cutthroat nastiness. To succeed, Cohn instructs, Trump must follow three surefire rules: attack, attack, attack; deny everything and admit nothing; and never acknowledge defeat and always claim victory….

‘The Apprentice’ Review: Sebastian Stan and Jeremy Strong Are Superb in Chilling Account of the Unholy Alliance That Birthed Donald Trump

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This Briahna Joy Gray interview of David Sirota discusses the fundamental problem of money in USA politics. Near the beginning, they discuss the likely danger that Harris will lay out positions that are progressive, but eventually abandon them and capitulate to the donor class, as she did on Medicare for All in 2019.

Beginning around 39:23, Sirota summarizes The Lever’s new work on Lewis Powell and the Powell Memo, and how Powell enabled corporations to corrupt the political system. There is some important  information that was not publicly known before The Lever staff combed through nearly forgotten archives the past two years, including Powell’s friendship with FBI Director J. Edgar Hoover, and the group of secret task forces established by the Chamber of Commerce to implement the Powel Memo.

They discuss what  the Democratic Party might do when Trump is no longer on the scene. The Party just can’t be held together if it’s only progressives and big money donors in the Big Tent. Sirota talks about what he saw at the Demcoratic National Convention: the tensions under the surface between clean energy groups and corporate sponsors involved in fossil fuels. “You had anti-billionaire Senator Bernie Sanders…  sharing the same stage with Illinois ultra-rich Democratic governor JB Pritzker.”

The last 20 minutes I found very tedious and a bit maddening. Gray asked whether or not Biden was a break from the right-ward drift of the Democratic Party since the 1970s. When Sirota said he thought that was the case, Gray refused to accept the answer and kept pressing for example of how Biden was “better.” Sirota would explain some policy change or program achievement, and Gray would just ignore it.

What a waste of the last 20 minutes! Why can’t Gray and other people on “the left” accept that, as Sirota said, “something changed” that made Biden much better on economics than Clinton and Obama? It would be so much more useful to try to identify what changed, what caused that change, and figure out if that cause and effect can be replicated again to continue driving the Democratic Party toward better economic policies.

And, glaring by its absence, was any discussion of how two of the most progressive member of Congress, Cori Bush and Jamal Bowman, were defeated in primaries earlier this year. They were buried by an avalanche of money from the Israeli front group, AIPAC. There was no mention of this at all.

Finally, also missing was any discussion of what people can do, either inside or outside the Democratic Party. Gray now believes that the two Sanders presidential campaigns, and the freezing out of AOC, Katie Porter, and The Squad, all show that the Democratic Party is useless as an instrument for achieving progress.

Ok, that’s understandable, but what are the alternatives? Remember, Gray and Sirota have both been “on the inside.” From 1999 to 2001, Sirota worked as press aide and spokesperson for then U.S. Representative Bernie Sanders, then served as a speechwriter and senior adviser for the Sanders 2020 presidential campaign. And Gray was National Press Secretary for the Sanders 2020 presidential campaign.

I should also note that in 2008, Sirota published The Uprising: An Unauthorized Tour of the Populist Revolt Scaring Wall Street and Washington, giving ample warning of the populist surges we have seen under Sanders and Trump. So, an important topic for discussion should be: Why did reactionaries  manage to take control of the (anti)Republican Party, but the progressives fails to take control of  the Democratic Party?

by Tony Wikrent

Strategic Political Economy

John Kiriakou: The Slide Into Authoritarianism

John Kiriakou [Consortium News, via Naked Capitalism 08-28-2024]

The Social Recession Is Accelerating 

Charles Hugh Smith [via Naked Capitalism 08-25-2024]

A reader asked about the term social recession which he’d noted in my book Get a Job, Build a Real Career and Defy a Bewildering Economy. Here is the paragraph:
“Stagnation in opportunities to work and earn (i.e. a financial recession) leads to social recession, a loss of opportunities for adulthood: a rewarding career, family, and a home of one’s own. In a social recession, unemployed young people may be mired in adolescent narcissism, eschewing ambitions not just in work but in romance and marriage.”….

In the purely financial / economic terms of growth of GDP, household income, corporate profits and the value of assets, the US has only been in an economic recession for a few months in 2008-09 and at the start of the pandemic lockdown. But when measured by the ability of just about anyone willing to work hard and practice basic frugality to buy a house and start a family, the US has been in a social recession since 2009. Demographics / economics analyst Chris H., who tweets as

CH @economica, recently posted charts which reflect this social recession, most strikingly in the collapse of the US birthrate that started in 2009. He asked: “The largest childbearing population in US history has gone on strike…maybe we should know why?”….

The social recession began as a direct result of policy responses to the Global Financial Meltdown in 2008-09, policies that favored capital and those who already owned assets, at the expense of everyone who did not inherit wealth/assets or was too young to buy assets such as houses when they were still affordable to average workers….

As I often note, average wages have stagnated for the past 45 years. This stagnation was tolerable as long as the cost of a house, childcare and healthcare insurance remained somewhat affordable to average workers, but once the engines of financialization transformed the US economy into a Bubble Economy of soaring real estate / stock valuations that then inevitably crash, triggering an even larger bailout / stimulus response that inflates an even greater bubble, the costs of home ownership, childcare and healthcare soared out of reach of all but the top 20%….

GRAPH Wage earners’ share of gross domestic income (GDI) declined from 1970’s 51% to 43% in 2022. $149 trillion in GDI was shifted from labor to capital.

Did wages rise 10-fold to match the 10-fold rise in the cost of a modest house? No. That is social recession in a nutshell. When this fact is raised in conversation, those in the top 10% protest, but their protest rings hollow, for what they’re really saying is: since I’m doing great and all my friends are doing great, everyone’s doing great. There’s a word for this: denial. Denial cannot solve problems, it can only make them worse.

Global power shift

Patrick Lawrence: “The End of Days” 

[Scheerpost , via Naked Capitalism 08-27-2024]

…Three-quarters of the French stood with Chirac, whose refusal to enlist France in Operation Iraqi Freedom strained Franco–American relations for several years. Remember “freedom fries” and the French as “cheese-eating surrender monkeys?” This was the level to which Bush II brought American discourse as he manipulated public opinion prior to the invasion. Good guys, bad guys. Black hats, white hats.

There is one detail of the U.S.–French confrontation over Iraq that remains very little known. Just before the 20 March 2003 invasion, Bush II called Chirac in a late-hour attempt to persuade him to change his mind. The exchange was very heated. Bush II made a vigorous argument that with the events of 11 September the prophesied war of Gog and Magog had at last begun. I can only imagine what went through the worldly Chirac’s mind, or indeed the look on his face, as Bush II discoursed in this manner.

I know of only one account of this conversation. It is in The Irony of American Destiny: The Tragedy of American Foreign Policy (Walker & Co., 2010), a book William Pfaff published late in his life. The book sits at the end of Pfaff’s long and principled career as a sort of summation. It is rightly read as his causes-and-consequences critique of American exceptionalism. And it includes, inter alia, a description of the Bush–Chirac exchange. He got it, if I recall correctly what he told me later, from a high source in the French Foreign Ministry.

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by Tony Wikrent

Strategic Political Economy

How Europe Could Reinvigorate Their Economy

Ian Wlesh, August 22, 2024

Force the US to reduce embassy staffs by 90% and remove all US NGOs and similar organizations.

Nicaragua shuts down 151 more NGOs, including US Chamber of Commerce affiliate 

[Anadolu Agency, via Naked Capitalism 08-23-2024]

How the Pentagon built Silicon Valley 

[Responsible Statescraft, via Naked Capitalism 08-21-2024]

[Yves Smith notes: This was documented years ago in Marianna Mazzucato’s book, The Entrepreneurial State.]

Global power shift

“How China acquires ‘the crown jewels’ of U.S. technology” 

[Pekingnology, via Naked Capitalism 08-19-2024]

Who Benefits From Sanctions? 

[Phenomenal World, via Naked Capitalism 08-19-2024]

‘On “How Sanctions Work: Iran and the Impact of Economic Warfare” by Narges Bajoghli, Vali Nasr, Djavad Salehi-Isfahani, and Ali Vaez.’

A Look at Iran’s First Ever Aircraft Carrier: Shahid Bagheri Promises to Expand Reach of Stealth Drone Fleet

Military Watch, August 21, 2024

Russia / Ukraine

Back to the Bloodlands: Operation Krepost 

Big Serge [ via Naked Capitalism 08-21-2024]

[The Ukrainian attack into Russia]

Oligarchy

As RFK Jr. Backs Trump, Here’s the Secretive Billionaire Plutocrat Funding Them Both

Jake Johnson, August 24, 2024 [CommonDreams]

Timothy Mellon, the reclusive heir to a Gilded Age fortune, has poured over $165 million into the 2024 election so far, with tens of millions backing both Donald Trump and Robert F. Kennedy Jr.

Koch Invests in Massive Land Grab From West African Herders 

[Exposed by CMD, via Naked Capitalism 08-22-2024]

Predatory finance

Crypto Took Down Another Federally-Insured Bank and Just Handed Its CEO a 24-Year Prison Sentence

Pam Martens and Russ Martens, August 23, 2024 [Wall Street on Parade]

Last year, the staff of a federally-insured bank in Kansas, Heartland Tri-State Bank, wired out more than one-third of the amount the bank held in deposits to a crypto scam. Why did they do that? Because the CEO of the bank, Shan Hanes, told them to do it. Hanes had become one more crypto sucker seduced by the allure of a get-rich-quick scheme. On Monday, Hanes was sentenced in a case brought by the U.S. Department of Justice to 24 years in prison for embezzling $47.1 million (via the wire transfers shown in the graph above) from the bank he was in charge of protecting. The bank failed last July with the Federal Deposit Insurance Corporation (FDIC) stepping in to make depositors whole while the investors in the bank (shareholders) were wiped out….

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by Tony Wikrent

Strategic Political Economy

The world will lose $4.7 trillion of revenue in the next decade to tax havens. How did we get here? 

[The Business Standard, via Naked Capitalism 08-16-2024]

American Pharmaceutical Companies Aren’t Paying Any Tax in the United States

Brad W. Setser and Michael Weilandt [CFR, via Naked Capitalism 08-16-2024]

It is an undisputed fact that American pharmaceutical prices are the highest in the world…. However, those high prices do not translate into high reported profits in the United States. Rather the contrary: large pharmaceutical companies generally report losing money in the U.S….

So high prices strangely seem to correlate with large losses. This, of course, is a clear sign that pharmaceutical companies live in a world marked by transfer pricing and tax arbitrage….

The average effective tax rate paid in the U.S. (so U.S. tax paid versus global profit) was only 3 percent from 2018 to 2022, well below the typical effective tax paid in the US before the Tax Cuts and Jobs Act (see the work of Senator Wyden and his staff for more details).

A Very Good Sign: Kamala Harris Is Going Right at Corporate Greed 

Nick Hanauer, August 16, 2024 [The New Republic]

… Greedy CEOs have milked the average American household for $12,000 since the pandemic. As a businessman, I can explain how they’re doing it. …if you compare corporate profits in 2019 to the last four years, you’ll find corporations have gouged their way to an almost unbelievable $1.5 trillion in excess profits since 2020—that’s in addition to their pre-pandemic profit rates.

That means the average American household has paid an eye-popping $12,000 in higher prices solely to pump up quarterly corporate profit margins. To put that figure into perspective, $12,000 could buy the average American household more than two years’ worth of groceries….

Over the last two years, CEOs learned they could get away with padding their profits by keeping prices high. We have really great evidence that this is what’s been happening, because CEOs admitted this is what’s been happening.

For example, Procter & Gamble chief financial officer Andre Schulten bragged during a 2023 earnings call that even though the company’s input costs to make diapers had decreased, they were still keeping consumer prices high….

This corporate embrace of price gouging is a new and troubling development in American capitalism. And this is an area I know something about.

I’ve founded, financed, and/or run 43 different companies, spanning a dozen different industries…. I’m deeply acquainted with all the tricks of the trade when it comes to corporate profit margins.

But I’ve never seen executives exult in raising prices like this….

The chasm between corporate costs and profits has never been greater in my lifetime:

• Combined wholesale and retail margins have increased by 25 percent from pre-pandemic times.

• Food and beverage retailers’ profit margins have risen by 29 percent from the pre-pandemic norm.

• And consumer prices have skyrocketed 3.4 times over producer costs over the past year.

Immediately before the pandemic, corporate profits were 9.7 percent of the total gross domestic product. From 2020 to 2023, they spiked to an average 11.2 percent of annual GDP. The disparity between those two numbers amounts to a jaw-dropping $1.5 trillion more of our economy that was transferred over to corporate profits in the last four years.

That money was picked directly from the pockets of American families, who each paid $12,000 more to plump the profit margins of corporations (and that’s not even counting the excess APR rates that have cost the average credit card user $946 over the same four-year period)….

Global power shift

China is on track to overtake France and the United States as the world’s leading source of atomic power 

[BNE Intellinews, via Naked Capitalism 08-15-2024]

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by Tony Wikrent

Strategic Political Economy

In 2023 the world’s forests stopped acting as a carbon sink 

[REDD Monitor, via Naked Capitalism 08-10-2024]

At the recent International Carbon Dioxide Conference in Manaus, Brazil, scientists presented preliminary findings that in 2023 the world’s forests stopped acting as a carbon sink. An intense drought in the Amazon rainforest and record wildfires in Canada were part of the reason that forests and other land ecosystems emitted almost as much carbon dioxide as they removed from the atmosphere.

Usually, forests remove about one-quarter of the world’s annual CO₂ emissions from the atmosphere. But in 2023, that carbon sink collapsed, study co-author Philippe Ciais of the French research organisation the Laboratory for Climate and Environmental Sciences told Reuters.

As a result, in 2023, the growth rate of CO₂ in the atmosphere shot up by 86% compared to 2022. Yet CO₂ emissions — which come mainly from burning fossil fuels — only increased by between 0.1% and 1.1%. The explanation is that natural carbon sinks absorbed much less….

‘Holy Sh*t This Ad Is Powerful’: UAW Says It Knows How to Defeat Trump and the Billionaire Class

The battle over who makes the rules for US companies

[Financial Times, via Naked Capitalism 08-06-2024]

….Over the past autumn and winter, the Chancery trial court ruled on three highly esoteric matters of corporate law, making certain long-accepted dealmaking practices impermissible.

But, this summer, the state’s legislature and governor were quickly persuaded by the influential law firms that represent big companies to enact changes to the Delaware General Corporation Law that nullified the rulings. The convention of waiting for the Delaware Supreme Court, often a tempering mechanism, to hear any appeals was ignored.

Lawyers representing pension funds, asset managers and individual shareholders fret that the changes will unduly limit their ability to bring lawsuits against misbehaving corporate boards and overmighty founders.

And many law professors worry that the foundations of Delaware corporate law have been carelessly erased without an understanding of the broader consequences….

Global power shift

China Is Done With Global Carmakers: “Thanks For Coming”: Dwindling Sales and Vanishing Profits

Michael Dunne, August 06, 2024 [via Naked Capitalism 08-10-2024]

For most of this century, foreign brands totally dominated China’s car market. Every year, they sold millions of cars and earned billions in profits.

Chinese consumers swarmed into Buick, Volkswagen, BMW and Toyota showrooms nationwide, happy to pay cash for the prestige of owning a brand that wasn’t Chinese.

“China is our forever profit machine,” my colleagues at GM liked to humble-brag a decade ago, back when I ran GM’s Indonesia operations. “We can bank on an easy $2 billion dividend every year.”

Now, suddenly, that golden era is over.

Sales and profits in the People’s Republic are vanishing. And boards in Detroit, Wolfsburg and Tokyo are stunned by the speed and intensity of the changes.

Ford has lost more than $5 billion in China since 2020. Sales are down 70% from their peak. “We’ve never seen competition like this before,” says CEO Jim Farley.

GM is hurting, too. The former poster child for sunny US-China relations, GM has lost more than $200 million so far this year alone. That marks the first time in two decades that GM’s China operations have printed red ink….

Driving China’s ascendancy is a massive and abrupt shift to electric vehicles. The EV share of total car sales will jump to almost 50% this year, up from just 6% in 2020.

Think about that. China has sprinted from 1 million to more than 10 million annual EV deliveries in just four short years. (I already see you dealership folks scratching your heads in amazement.)

Global automakers were caught flat-footed on EVs, lulled into complacency by years of winning at selling gasoline-powered vehicles.

TSMC Arizona struggles to overcome vast differences between Taiwanese and US work culture 

[Tom’s Hardware, via Naked Capitalism 08-10-2024]

[NC commenter Micael T: “So all this American Talwan vs. China nonsense iis really about importing new management practices to the US?” Moi: Some of you may remember that Toyota went into a joint venture with GM to take over GM’s worst plant, which feature regular absenteeism and drunkenness in its workforce, and of course high defect rates. Toyota got the plant performance to above average for Toyota plants, which was much higher than GM levels.”]

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