Paul Craig Roberts -- The Dying Institutions Of Western Civilization

The Dying Institutions Of Western Civilization

August 31, 2015 

nothing is left

Paul Craig Roberts

Judiciary Branch Has Self-Abolished

The US no longer has a judiciary. This former branch of government has transitioned into an enabler of executive branch fascism.

Privacy is a civil liberty protected by the US Constitution. The Constitution relies on courts to enforce its prohibitions against intrusive government, but if the executive branch claims (no proof required) “national security,” courts kiss the Constitution good-bye.

Federal judges are chosen by the executive branch. The senate can refuse to confirm, but that is rare. The executive branch chooses judges who are friendly to executive power. This is especially the case for the appeals courts and the Supreme Court. The Justice (sic) Department keeps tabs on district court judges who rule against the government, and these judges don’t make it to the higher courts. The result over time is to erode civil liberty.

Recently a three-judge panel of the US Appeals Court for the District of Columbia ruled that the National Security Agency can continue its mass surveillance of the US population without showing cause. The panel avoided the constitutional question by ruling on procedural terms that NSA had a right to withhold the information that would prove the plaintiffs’ case.

By refusing to extend the section of the USA PATRIOT Act—a name that puts a patriotic sheen on Orwellian totalitarianism—that gave carte blanche to the NSA and by passing the USA Freedom Act, Congress attempted to give NSA’s spying a constitutional patina. The USA Freedom Act allows the telecom companies to spy on us and collect all of our communications data and for NSA to access the data by obtaining a warrant from the Foreign Intelligence Surveillance Act (FISA) Court. The Freedom Act protects constitutional procedures by requiring NSA to go through the motions, but it does not prevent telecom companies from invading our privacy in behalf of NSA.

No one has ever explained the supposed threat that American citizens pose to themselves that requires all of their communications to be collected and stored by Big Brother. If the US Constitution was respected by the executive branch, Congress, the judiciary, law schools and bar associations, there would have been a public discussion about whether Americans are most threatened by the supposed threat that requires universal surveillance or by the loss of their constitutional protections. We all know what our Founding Fathers’ answer would be.

Florida Government Defies Voters, Misuses Earmarked Funds

By allocating funds set aside by law for the purchase of land and wildlife habitat to other purposes, Florida Republicans have negated the Water and Land Conservation Amendment that Floridians passed with a 75% majority last November. The amendment requires that one-third of the funds produced by real estate stamp taxes be used for conservation purposes.

Conservation runs counter to the interests of real estate developers and polluters who have done so much to destroy Florida’s unique environment. Real estate developers and polluters are major Republican contributors.

Faced with the people’s will, the Republican government is claiming that proper uses of the fund are to pay salaries for the Florida Department of Agriculture and Consumer Services, to teach best management practices for privately owned lands, and to pay private agricultural operations to retain the pollution that results from their operations on their own property.

In typical Republican fashion, money legally mandated for purchasing public land is being used to pay state salaries and to make payments to private land owners. This is a good indication of the scant respect that American democracy has for the will of the people.

A Robot Will Take Your Job

Several recent studies conclude that robots are going to displace millions of human workers. An Oxford University study found that 47 percent of jobs are at risk. Another study concludes that one third of all jobs will be lost to robots during the next 10 years. Some claim that the net job loss will not be so large, because new jobs will be created in order to repair the robots, at least until robots learn to do this also.

Perhaps you remember the claims by economists Matthew Slaughter, Michael Porter, and other shills for jobs offshoring that moving American jobs offshore would create better and more jobs in the US. After many years I am still watching for any sign of these promised new jobs.

Despite promises to the contrary, the US economy has been halted in its tracks by jobs offshoring. US corporations have moved middle class manufacturing jobs abroad. The high speed Internet has made it possible for tradable professional skills, such as software engineering, information technology, research, design, and scan interpretations by medical doctors, to be performed offshore. This enormous giveaway of American middle class jobs and GDP to foreign countries has left the domestic economy with non-tradable service jobs.

Robotics is now attacking the remaining domestic service jobs. Robots are becoming sales assistants, providing room service to hotel guests, filling orders at delis, providing medical diagnosis, cooking and serving meals, and becoming incorporated into smart household appliances that reduce the need for electrical and repair services. All of us are familiar with customer service robots. We encounter them whenever we telephone about a bank or credit card statement or utility bill.

The unaddressed problem is: what happens to consumer demand, on which the economy depends, when humans are replaced by robots? Robots don’t need a paycheck in order to purchase food, clothes, shoes, entertainment, health care, go on vacations, or to make car, utility, credit card, rent or mortgage payments. The consumer economy has suffered from incomes lost to jobs offshoring. If robots replace yet more Americans, where does the income come from to purchase the products of the robots’ work? Any one firm’s owners and managers can benefit from lowering costs by replacing a human workforce with robots, but all firms cannot. If all firms replace their work forces with robots, the rate of unemployment becomes astronomical, and consumer demand collapses pulling down the economy.

Economists call what works in the singular but not in the plural the fallacy of composition. Keynesian macroeconomists teach that if everyone in society is thrifty with the consequence that savers save more than investors want to invest, aggregate demand falls, and with it incomes and savings. Thus, by trying to save more, savers end up with less.

With the advent of jobs offshoring and financial deregulation, the US has one of the most unequal distributions of income and wealth. As robotics patents are held by a mere handful of people, the concentration of income and wealth at the top will increase.

What kind of society would result? Will governments nationalize robotics or heavily tax the incomes of owners in order to issue monthly payments to people with which to purchase the work product of robots? What would a population living off the work of robots do with itself? Would population growth be tolerated? Or would the powerful owners of robotics use the governments that they control to reduce the surplus population?

Free market economists with their heads forever in the sand will say, “No worry, people thought that the industrial revolution would destroy the demand for labor, but industry employed ever more people.” A former MIT professor who has gone into business producing robots says robots will bring the jobs lost to offshoring home to America. But will they be jobs for humans or for robots? I am waiting to hear how robotics will expand the demand for human labor beyond a few repairmen to fix robots. And I am still waiting for the new and better jobs that offshoring promised. By the time they get here, if ever, robots will take them away.

Stock Market Supported By Corporate Buybacks

Pension funds purchase corporate bonds, and the corporations use the money to buy back their own stocks, thus driving up the price, enriching executives with bonuses and shareholders with capital gains, but leaving the company in debt. One study found that last year 95 percent of all corporate earnings were used either to pay dividends or to buy back the company’s stock. Read Mike Whitney’s report in CounterPunch: 

http://www.counterpunch.org/2015/08/28/looting-made-easy-the-2-trillion-buyback-binge/

The Ship Did It

The presence of The White Lady, a four-masted Chilean sailing ship, at the Tall Ships Festival in England is being protested. Protestors believe the ship is guilty of human rights violations as the ship was allegedly the site of torture inflicted by the Pinochet government as it put down the terrorism that followed the overthrow of the Allende government. Just as guns murder, ships torture.

The torture alleged to have occurred aboard The White Lady sounds like a small town performance of the torture sanctioned by Washington and London at Abu Ghraib, Guantanamo, and numerous secret sites. How are the American and British democracies superior to Chilean military dictatorship if the former out-tortures the latter? To my knowledge, the Pinochet regime, unlike the Bush regime, never had John Yoo write a legal memo making torture legal. This is probably why, prior to stepping down and returning Chile to constitutional democracy, Pinochet issued pardons both to the military government and to the terrorists.

Demand for Silver Outstripping Supply But Price Is Falling
On numerous occasions Dave Kranzler and I have pointed out that despite high and rising demand for physical bullion and constrained supply, the prices of gold and silver are forced down by concerted manipulation in the futures market. Silver supplies are so tight that both the US and Canadian mints have had to suspend the production and sale of silver coins. Despite supply constraints, in the manipulated futures market the price of silver has been falling, but in the physical market the price of silver coins has risen with premiums over spot raising coin prices as much as 30 percent. Regulatory authorities have brought no action against the obvious manipulation in the futures market.

It is important to the value of the fiat currencies that are being printed in profusion that gold and silver be discredited as hedges against currency depreciation. Thus, authorities turn a blind eye to the obvious manipulation, the purpose of which is to show that inflating fiat paper currencies are gaining in value relative to gold and silver.

I am awaiting the explanation from the Commodity Futures Trading Commission (CFTC) why it is normal for inflating fiat currencies to gain value in relation to gold and silver bullion. Kranzler and I, supported by individuals thoroughly acquainted with the bullion market, have written to the CFTC asking how it is possible for price to fall when demand is rising and supply is constrained.

We will see if a former Assistant Secretary of the US Treasury can get an answer.

Good-bye To Cash

If all this isn’t enough, government now wants to deprive us of cash in order to deprive us of private and unreported payments and savings. The Financial Times, Britain’s equivalent to the Wall Street Journal, has published an anonymous article advocating that cash be abolished and all transactions be digital so that authorities can know and completely control our behavior. Clearly a big push in this direction is in the works. If the authorities succeed, we will have a situation in which the privacy guaranteed by the US Constitution becomes a myth that slowly fades from memory.

Dr. Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. Roberts' latest books areThe Failure of Laissez Faire Capitalism and Economic Dissolution of the West and How America Was Lost.