Producer prices showed an even sharper increase of 1.8 percent, according to the Labor Department. The producer price index has increased by 9.2 percent in the past year in the sharpest increase since 1981. Energy prices led the increase, jumping by 6.6 percent, while transportation costs also shot up as airlines increased ticket prices by 4.5 percent.

Wage levels, meanwhile, decreased by .9 percent after adjusting for inflation. Real wages have fallen by a full 2.4 percent in the past year.

Such drastic cuts in real wages—representing a massive transfer of wealth from the working class to the very rich—are sending shockwaves through the whole of American society.

In other words, the Fed intends—if it can—to tighten the money supply and deepen the US economic downturn to prevent any wages offensive by the working class. In case anyone missed the point, Bernanke reiterated the claim in the next paragraph, saying, “In light of the increase in upside inflation risk, we must be particularly alert to any indications, ... that the inflationary impulses from commodity prices are becoming embedded in the domestic wage and price-setting process.”

In essence, Bernanke and his fellow Fed members are warning that the sharp decreases in real incomes will inexorably lead millions of working people to an open struggle for livable wages. But under conditions where businesses—aided by the Fed—are seeking to pass on the full cost of the crisis to the masses of working people, such struggles will naturally turn into an open fight against the capitalist system itself. This is the nightmare of not only Bernanke, but of the entire financial oligarchy and its political establishment. Indeed, they see the suppression of such a movement as “very costly.”

The fact is, until recently we've always expected government to work. We've always expected the trash to be hauled, the schools to educate, the roads to run smoothly and the police to do a good enough job at finding and punishing our criminals. More recently we've also expected them to help us through some rough economic patches (maybe not us specifically, but "US" in general) and to protect us from the more problematic tendencies of capitalism and protect us from discrimination from certain groups.

But now it looks more and more like things are falling apart. Schools don't educate, roads fall apart, the police is reviled (by those who don't know better), the statistics are fixed so that our Social Security won't be able to help (never mind the spending), and capitalist are getting their disastrous excesses protected, legalized and monopolized while the protections are made illegal. At least some groups get to have "hate crimes against them" illegalized.

So what happens? We're now getting privatization. Government programs for profit.

Think of it: Subdivisions guarded by rent-a-cops, toll roads run by Spanish-Australian conglomerates, schools run by churches but paid for by the government...eventually we're going to figure out a way to hand control to families, with the idea that somone trying to make a profit off governing people will figure out how to give the people what they want, cheaper better quicker and more satisfyingly.

And we're going to get a lot of stuff that we're not bargaining for.

Such as: If someone owns the government, they get certain powers that the government by the people doesn't have.

Like the ability to keep people out. Private schools can kick out troublesome students easier than public schools can, and I see no reason to assume that one (or two) owners can't insure that some poor sap (or group of saps) is trapped within some small town with a limited number of roads and private ownership of them.

And you think that a bureaucracy is a heavy burden to carry; try someone whose sole means of support is living off the people he's supposed to rule. At least we require some semblance of having lived in the real world when we elect our congressmen/senators/president/governor; imagine knowing that the people above you have to make that living off of you. Your grains gives the people above you the right to feed you and dictate their rules to you.

Here's another thing that privatization of government leads to: deification of the rulers. Think of it: "Divine Right of Kings" wouldn't have occurred if the people didn't own government. There needs to be a reason for the masses to accept that somebody above them DESERVES to be on top; hence the idea that God (or the Gods) placed said person (or people) on top.

So let me ask you: Do you want things privatized?

Here's the issue: Privatize something and it becomes one less source of long-term income. You may get a bunch of money up front, but you lose a long-term source AND power over it as well. And when the item privatized is important enough, the privateers come to own the government.

You want an example of what privatization can lead to, think of Railroads: The United States never privatized its railroads (outside of Amtrak, and that was an attempt to let die) and all people seemed to talk about was how constricting it was to travel by train and how the forces who owned the railroads were running the nation. When the car became affordable people began leaving the train in droves. (and yes, I'm aware that the railroads were never privatized; it's the state where I believe things would go to if privatization were to take hold).

Again, do you want privatization to continue? Do you want us to become a Feudal nation (or set of nations, as things will fall to)?

Way back in March 2003, President Bush outlined sweeping reform of Medicare and Social Security. A few months later, he followed through on that promise, signing the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. Prior to this period, Medicare comprised Part A, which provides hospital insurance and Part B, which provides medical insurance. The 2003 Act introduced Part C- the Medicare Advantage (MA) program, which was technically replacing the '97 Medicare+Choice plan- and Part D, the Prescription Drug program. Part D is pretty self-explanatory- Medicare beneficiaries could now purchase prescription drugs, either generic or not, through the program. The more interesting component of the Act was the MA plan, which was Bush's not-so-subtle attempt to begin privatizing Medicare. Under the MA plan, private plans, like HMOs, would offer health care benefits to beneficiaries. The intention was to promote competition among the various entities in order to offer lower premiums and provide better preventative care. Thanks to a complex payment schedule which was determined by the government, some private plans were even required to offer supplemental health care or rebates. Medicare beneficiaries could choose to participate either in the MA plan or opt to stay with the traditional fee-for-service plan. About 20% chose the former and 80% the latter. A 2007 CBO report estimates that the rate of enrollment in the MA plan will grow at an annual average rate of 7% over the next ten years.

Now, in essence, this was the free-market at work. And like every other institution that has adopted free-market guidelines, the MA plan is terribly inefficient and messy. This is largely due to an awful payment schedule devised by the government. Here's how it works- private plans (like Humana, WellPoint etc.) submit their bids to provide health care coverage to beneficiaries. The government compares these bids to county-level benchmarks that are determined by the Centers for Medicaid and Medicare Services (CMS). These benchmarks are the maximum payments that the government makes for enrollees in private plans. If the bid is higher than govt. benchmarks, the enrollees pay the difference. But, and this is key, if the bid is lower, Medicare retains only 25% of the savings. 75% must be offered as rebates or supplemental health care benefits that I mentioned above. Now, it makes no sense to me that the government only keeps 25% of savings since this all adds up. As a result of this perplexing rule, private plans cost taxpayers 12% more than traditional fee-for-service. So, here you have another instance of how the free-market has failed but don't tell that to the CATO-types. 

Anyway, the recent Medicare debate boiled down to this- Congress overwhelmingly rejected a bill that would have cut Medicare payments to doctors and other health care providers. In addition, Congress voted to reduce federal payments to the MA plan, effectively weakening it. This is a huge victory for those of us supporting universal health care plan. This demonstrates that the free-market cannot be relied on for solutions to every supposed government inefficiency. Another reason why I disliked the MA plan is that it threatened the universal nature of Medicare and created artificial hierarchies for care. After all, private insurers are notorious for screening out those with pre-existing conditions. In addition, privatizing Medicare does little to actually reform the health care system, which is in total shambles.

The larger problem here is that Republicans (and some Democrats) approach every problem by attempting to prop up shitty free-market institutions. Broken education system? Vouchers! Not enough soldiers? Blackwater! Too much pollution? Cap and trade! "Problems" with social security? Private accounts! Now, take a minute to evaluate the success of these free-market solutions and tell me where the American public stands on each of these issues. Ultimately, the larger narrative emerging from the Medicare debate is this- privatizing governmental programs will never work because, in the end, the government just does a better job with them.

Note: For further reading on the MA plan, this is a good resource.

-Indira

... I'm proposing today a strategic initiative designed to free us from the crises that are holding us down and to regain control of our own destiny. It's not the only thing we need to do. But this strategic challenge is the lynchpin of a bold new strategy needed to re-power America.

Today I challenge our nation to commit to producing 100 percent of our electricity from renewable energy and truly clean carbon-free sources within 10 years.

For reasons I still haven't grasped, it's nearly impossible to write about climate change in a mainstream setting without having denialists pop up and, among other things, accuse you of taking orders from Al Gore. (My friend and Ottawa Citizen colleague Kate Heartfield remarked on it a little while ago.) Or, for reasons even more obscure, "Algore," like he's a biomechanical replicant of a former vice-president with a model and make instead of a person with a regular name.

But anyway, the criticism usually revolves around the idea that Gore is a crank, full of pie-in-the-sky ideas about someday we might live in a paradaisical vision of windmills and solar panels, not useful proposal for what we might actually do right now in the world we actually live in. Or, alternatively, that he's a doomsayer whose obviously absurd prophecies of planetary doom are beneath any rational consideration.

Either line of criticism is so disconnected from the reality of Gore's message, and the manifestly reasonable tone of his main vehicle An Inconvenient Truth, that they're difficult to engage.

Then he goes and says something like that America should be carbon-neutral in its electricity generation by 2018. And he compares it to the U.S. space program.

On July 16, 1969, the United States of America was finally ready to meet President Kennedy's challenge of landing Americans on the moon. I will never forget standing beside my father a few miles from the launch site, waiting for the giant Saturn 5 rocket to lift Apollo 11 into the sky. I was a young man, 21 years old, who had graduated from college a month before and was enlisting in the United States Army three weeks later.

I will never forget the inspiration of those minutes.

I wasn't alive for them, so maybe I can't fully comprehend the power of the moment he's talking about, but this strikes me as a dangerously false parallel. The Apollo program, as ambitious as it was, was essentially about making it possible for a few people (astronauts) to do one thing (walk on the Moon) once. More often if possible, but once would meet the challenge. Gore is talking about changing the way everybody does everything, for always. (Clive Crook makes a similar argument here.)

Someone whose public credibility is as fragile as Gore's is — on a rising curve but certainly not secure — and so important to the movement he argues is key to the continued viability of the planet Earth as a home for humanity, should treat it with a little more care.

From Crook:

Does he even mean it? "I see my role as enlarging the political space in which Senator Obama or Senator McCain can confront this issue as president next year," he says. Translation: I advocate the impossible so that the possible becomes more probable. Fair enough, one might say. But propaganda in a good cause is still propaganda, isn't it?

Ah. So it's strategic nonsense.

Look. It's not happening, no matter who gets elected. Building a new wind farm, a small one, takes two years, and there's a shortage of gear and qualified people to install and maintain it. You can't fix that in a decade (see the difference between an accomplishment for the few and a fundamental change for the many, above). It's so far from happening that it's difficult even to take the idea seriously. You can't.

It'll be all the denialists talk about for the next year, pointing and laughing, and for a change they'll be right.

.

_____________________________________________

Thanks for checking out my posting. Check out the latest at http://mrobvious.wordpress.com
No scraping please….

_____________________________________________

http://www.youtube.com/watch?v=eScDfYzMEEw

AL GORE: Green Energy by 2018 (7/17 Speech)

http://www.youtube.com/watch?v=uqlXid_ankQ

Eye To Eye: Al Gore

http://www.youtube.com/watch?v=YEuU42qijmo

GORE: On Coal and a New Power Grid

http://www.youtube.com/watch?v=0X4REcq6qk0

Al Gore Snowjob

http://www.youtube.com/watch?v=DRaeEIN5Sh8

The Myth about Global Warming

http://www.youtube.com/watch?v=iMDi_u0dcig&feature=related

Global Cooling: The Coming Ice Age

http://www.youtube.com/watch?v=ttLBqB0qDko

Global Warming Hoax

http://www.youtube.com/watch?v=Io-Tb7vTamY

There is no climate crisis except in Al Gore's mind.

Climate continues to change. Nothing new here or to get worried about.

We are still in the current ice age and are overdue for another period of glaciation.

When will this occurr, nobody really knows.

Enjoy global warming why you can, the big chill is coming or may be not.

Al Gore continues to lie and try to scare people into taking action based upon government funded junk science of computer climate models.

In addition to increased demand for energy by developing countries such as China and India, the US government through regulations and laws has restricted the production of energy in the United States and thereby reduced the supply. The result higher prices due in part to the Federal government.

The main reason both gasoline and electrical power has been increasing in price is government regulation  in the market to stop the drilling for oil and the prevention of the building of nuclear and coal plants and refineries.

Without these government regulations, their would be an abundance of both oil and electrical power at affordable prices.

The Federal government is the problem and not the solution to more affordable energy for generating electricity, transport and heating.

More government subsidies for solar and wind power is  taxing Americans to pay others that benefit from the subsidies. This is exactly what is happening with ethanol subsidies that is resulting in rising gasoline and food prices.

Glaciers all over the world have been both advancing and retreating from time immemorial.

The same is true of the polar ice packs. 

Frankly the American people could care less.

Only those with a vested interest in scaring people and profiting from it maintain that man is responsible for global warming. 

Please prove that man is the primary cause of global warming.

Gore knows scientists cannot prove this hypothesis.

Man has very little to do with with climate change and is certainly not the primary or even secondary cause.

Until Gore can, none of Gore's policy recommendations should be given any consideration.

Gore's policy recommendations if followed would wreck the United States economy and result in millions of people losing their jobs.

He favors a cap and trade tax that would increase the cost of good and services. 

The goal of producing all of America's energy from carbon-free sources such as solar, wind, and geothermal in the next ten years is not challenging, it is impossibe withous huge and very costly government subsidies that would require a massive tax increase.

The American people have better things to spend their hard earned money on.

He knows as does any one who has looked at the numbers that alternative renewable energy cannot supply the energy the US needs. Gore is attempting to destroy America with his continuing disinformation campaign.

Solar, wind and geothermal power cannot even come close to producing enough electricity to totally replace the electrical power produced by coal, nuclear and natural gas given the state of technology today. 

The technology for both solar panels and wind generated power is simply not competitive. This is the reason solar and wind power needs to be subsidized by the government using tax dollars.

If solar and wind could deliver the required energy, it would not need government subsidies.

Companies and investors would have had  every incentive to make it happen.

The American people want affordable energy.

Let the planet and climate take care of itself.

The American people need to worry about the American elites trying to use government coercion to limit the liberty of the American people. 

the rolling stones - you can't always get what you want

http://www.youtube.com/watch?v=qzz1VEN1SEk

Background Articles and Videos

Ice age to warming - and back?

"...While policymakers have worried long and hard about global warming, which might raise Earth's temperature 1.4 to 5.8 degrees C by century's end, a growing body of evidence suggests natural forces could just as easily plunge Earth's average temperatures downward. In the past, the planet's climate has changed 10 degrees in as little as 10 years. ..."

http://www.csmonitor.com/2004/0318/p13s01-sten.html

Last glacial period

"The last glacial period was the most recent glacial period within the current ice age, occurring in the Pleistocene epoch. It began about 110,000 years ago and ended between 10,000 and 15,000 BP. During this period there were several changes between glacier advance and retreat. The maximum extent of glaciation was approximately 18,000 years ago. While the general pattern of global cooling and glacier advance was similar, local differences in the development of glacier advance and retreat make it difficult to compare the details from continent to continent (see picture of ice core data below for differences).

The last glacial period is sometimes colloquially referred to as the last ice age, though this use is incorrect because an ice age is a longer period of cold temperature in which ice sheets cover large parts of the Earth. Glacials, on the other hand, refer to colder phases within an ice age that separate interglacials. Thus, the end of the last glacial period is not the end of the last ice age. The end of the last glacial period was about 12,500 years ago, while the end of the last ice age has not yet come: little evidence points to a stop of the glacial-interglacial cycle of the last million years. ..."

http://en.wikipedia.org/wiki/Last_glacial_period

Ice Age

"An ice age is a period of long-term reduction in the temperature of the Earth's surface and atmosphere, resulting in an expansion of continental ice sheets, polar ice sheets and alpine glaciers. Glaciologically, ice age is often used to mean a period of ice sheets in the northern and southern hemispheres; by this definition we are still in an ice age (because the Greenland and Antarctic ice sheets still exist). More colloquially, when speaking of the last few million years, ice age is used to refer to colder periods with extensive ice sheets over the North American and Eurasian continents: in this sense, the most recent ice age peaked about 11,000 years ago.

http://en.wikipedia.org/wiki/Ice_age

Why were there four long, generally cool periods during which continent-sized glaciers advanced and retreated?

http://www.museum.state.il.us/exhibits/ice_ages/why_4_cool_periods.html

Geology: Glaciers

http://www.youtube.com/watch?v=gce9SqEy7BE

300 year history of renewable energy

http://www.youtube.com/watch?v=iIXuXlfKyrc

Lesson 19 Glaciation - Part 1

http://www.youtube.com/watch?v=TJG6pqh3q28&feature=related

Lesson 19 Glaciation - Part 2

http://www.youtube.com/watch?v=RF0uOotKhrc

Lesson 19 Glaciation - Part 3

http://www.youtube.com/watch?v=LlYRWb3zBYY

Lesson 19 Glaciation - Part 4

http://www.youtube.com/watch?v=3aJtWPPjGTc

Lesson 19 Glaciation - Part 5

http://www.youtube.com/watch?v=fFeRFeo_01Q

Lesson 19 Glaciation - Part 6

http://www.youtube.com/watch?v=su_h1aXSSo0

Lesson 19 Glaciation - Part 7

http://www.youtube.com/watch?v=82vPk6eVUhY

Are We on the Brink of a 'New Little Ice Age?'

"...It is that global climate is moving in a direction that makes abrupt climate change more probable, that these dynamics lie beyond the capability of many of the models used in IPCC reports, and the consequences of ignoring this may be large. For those of us living around the edge of the N. Atlantic Ocean, we may be planning for climate scenarios of global warming that are opposite to what might actually occur."

http://www.whoi.edu/page.do?pid=12455&tid=282&cid=10046

The Big Chill Funeral

http://www.youtube.com/watch?v=kiw_3olyJ2c

Related Posts On Pronk Palisades

National Center for Policy Analysis–A Global Warming Primer

Global Warming is The Greatest Hoax, Scam and Disinformation Campaign in History

Global Warming Videos

Global Warming Books

Global Warming Sites

Al Gore: Agent of Influence or Useful Idiot of Disinformation

Al Gore: Agent of Influence and Planetary Propeller Head!

Al Gore’s Little White Lie: Man-Made Global Warming Causing Polar Bears To Drown 

Al Gore’s Big Whopper–Sea Levels Rise By 2100: Gore 20 Feet vs IPCC 2 Feet? 

Clinton’s Cap and Trade Tax on The American People for Consuming Electricity and Driving Cars, SUVs and Trucks!

Facing Fundamental Facts

Presidential Election 2008: American Elites Vs. American People

Let Them Eat Cake Act: American Elites Killing and Starving The American People

The Heidelberg Appeal: Beware of False Gods and Prophets 

Going Deep–Cool–Deep Ocean Water (DOW)–Ocean Power!

Saving The World: The Importance of Getting The Priorities Right

A Kinder Gentler Wiser Microsoft Gives Away Valuable Software Developer Tools to Students Around The World!

Originally posted 2005-04-22.

I received an invitation several weeks ago to listen to a man from Senegal speak on U.S. farm policy and its effects on the people of his country. I've always considered myself more "socially responsible" than many people, but listening to him, combined with further reading, has convinced me that the United States' current system of farm subsidies goes beyond economic foolishness. It is, in fact, a transfer of wealth from people living at a subsistence level to the people in the wealthiest layers of the wealthiest nation in the world, a transfer which harms poor farmers, contributes to unnecessary deaths, economic and environmental degradation in cotton-producing countries, and, as a final insult, increases costs to consumers of farm products. Although this is true of various products, the Senegalese speaker focused on cotton, and I’ll do the same in this article. It would be easy to blame all of this on “bought politicians” and “greedy corporations”, but that’s far too easy. Indeed, our political and economic system does bear some blame for these results, but farm subsidies make no sense from the capitalist economic view that we claim to hold! Though many politicians can be influenced by money, all the campaign contributions in the world won’t help them if they know that a certain vote on an issue will result in their loss of office. Though large corporations may profit from the current system, they’re only operating in their own interests, as we would expect them to do in a capitalist economy. All of these problems can be addressed by starting with ourselves, making sure that we ourselves consume responsibly and that we make our displeasure at farm subsidies heard!

First, let me give you a few numbers from Oxfam's briefing "Finding the Moral Fiber", a paper that you can find at http://tinyurl.com/7v7ns.
• In crop years 2001 and 2002, sub-Saharan countries lost an estimated combined $400 million due to U.S. subsidies
• In crop year 2002, the U.S. subsidized internal cotton production to the tune of $3.2 billion, more than the GDPs of any cotton-producing country in sub-Saharan Africa.
• In crop year 2003, the U.S. exported 76 percent of its cotton production, or 41 percent of world exports.
• The U.S. spent $14.8 billion from crop years 1998 through 2002, around two thirds of the $21.6 billion value of the cotton produced in that time.
• The top 1 percent of cotton farms receive 25 percent of subsidies, while the top 10 percent of farms receive more than half of all payments.
• Oxfam estimates that the economic loss to cotton-producing countries by U.S. subsidies in many cases exceeds the aid provided to those countries by the U.S.

So, you might ask, how can we say that subsidies to U.S. cotton producers hurt African farmers? They are, after all, separated by an ocean or two, and we aren’t forcing African farmers to send U.S. cotton producers monthly checks! The answer boils down to simple economics: as the supply of a good increases, the price will drop if the demand doesn’t increase to a similar degree. Normally, as people become willing to pay less per unit (e.g., a bale of cotton), the number of suppliers willing to sell at that price decreases, until just enough of the most efficient producers (who are able to make a profit at the lowest prices) are willing to sell a good at a given price to satisfy the demand at that price for the good (for further explanation of this, see http://tinyurl.com/czbh6). Since, according to Oxfam’s briefing, the U.S. produces cotton for about 68 cents per pound compared to Benin’s 30 cents per pound, one would expect that the U.S. would be moving toward producing less cotton, and shifting to items they’re better at producing. The subsidies keep this from happening, though: money flows from federal coffers to cotton producers, making it possible for them to sell cotton at a loss and still make a profit through subsidies. The incentive, then, is to produce as much cotton as possible, to receive as large a share of the subsidies as possible. The result: the figure cited above, in which the U.S., possibly one of the most expensive places in which to produce cotton, exports 76 percent of its production to other countries!

It seems ironic that producing more than is needed in one place can cause poverty elsewhere, but this is what is happening. As subsidized U.S. cotton finds its way onto the world market, the increased supply pushes the price of cotton down. U.S. farmers, because of the subsidies, can tolerate these low prices. A farmer in Africa, though, who receives no subsidies, who lives on a dollar a day, and whose country’s economy depends heavily on cotton exports to fund public services, including education and research, has no such cushion. If he’s forced to sell his cotton at a price even below his low cost of production, he loses his livelihood. In the U.S., we can have the joy of knowing that not only have our tax dollars ensured that we will pay more for our clothing by subsidizing expensive producers (even if clothing appears cheap on the shelves, tax-supported subsidies are ultimately paid not by “the government”, but by tax-paying citizens), but we have also succeeded in making the lives of farmers, of families, even of entire impoverished nations, worse than they had been by depriving them of their livelihoods, and of the means to improve their situations.

So, in my mind, “fair trade” isn’t about protests, as we’ve all seen at WTO meetings. It’s not about requiring a “global minimum wage” as a pretense for protectionism. In this case, fair trade is about stopping stealing from those who can’t afford it while making those who “play the system” wealthy. Let’s stop subsidizing cotton production in this country, and let those who can produce it cheaply do so. By ceasing the subsidization of cotton, we’ll pay less overall (as we include the current subsidies of expensive production) for our supply. If we stop the subsidies and allow cotton prices to return to their “natural” levels, we’ll do much to help the lives of those who truly need our help. Let your lawmakers know (you can find their contact information at http://www.congress.org/) that you can’t support this continued “reverse Robin Hood” operation of taking from the poor (and ourselves!) and giving to the rich. Join Oxfam (http://www.oxfamamerica.org/), as I have done, to stay informed. Look for ways that you can help.

So, the decisions made by our legislators and those lobbying them have had significant impacts. The decisions that each of us individually make, though, are those for which we bear the most responsibility. Every time I buy a cotton shirt, I’m making a statement. It hasn’t been a conscious one, but now I know what I’m saying. When I buy a piece of clothing, I accept the processes and the material that went into it. If I buy cotton grown in the U.S., I’m speaking. As a single consumer, I might not be speaking loudly on an individual level, but I’m in some way approving of the status quo. I want to change this—I’ve been looking for the “cotton” equivalent of TransFair USA’s “Fair Trade” food certifications, but haven’t found anything yet. Just going with silk would be another interesting alternative, but I really don’t know much about the economics behind it. At any rate, I do want to consume responsibly; suggestions are welcome. In the meantime, let’s get these subsidies moved to their rightful place--to history’s garbage heap! Please, get a postcard and write your congressional representatives, asking them to cap subsidies, to stop this ridiculous, toxic game!

The term “exploitation” typically conjures up images of horrendous working conditions, perhaps sweatshops in China or India, or the child labour used by Western clothes manufacturers. We think of people working long hours for little pay in terrible conditions ruthlessly bullied by unscrupulous bosses or gangmasters.

Such “exploitation” is presented to us as exceptional – and contrasted with the “normality” of working life for most people, particularly in countries such as Britain.

Karl Marx had a different understanding of exploitation. Rather than seeing it as exceptional, he argued that exploitation is fundamental to capitalism.

For Marx, exploitation was not just about the level of wages received, or working conditions, but was the very process whereby capitalism creates profit out of the work we do.

In order to understand what Marx meant by exploitation we need to start with his explanation of where profits ultimately come from – the “labour theory of value”.

Marx argued that human labour is the source of all value. At the time many economists agreed with this. But Marx went further – he argued that the amount of value created by people when they work is greater than the amount they receive back in wages.

Therefore the capitalist is stealing from workers some of the value that their labour has created. This “surplus value” forms the basis of profit.

This argument is an anathema to any mainstream economist or commentator. They generally accept that the world of work involves an equitable exchange – “a fair day’s pay for fair day’s work”.

If anything, we are told that workers are being “greedy” when they demand pay increases over and above what is considered “fair”. Such “selfish” pay demands risk the “health of the whole economy”, they claim.

Fair’s fair?

But for Marx, this ideology of “free and fair exchange” masks the exploitation built into the capitalist system. It hides the exploitation that goes on every day in a society where a tiny minority of people make vast profits out of the work done by the majority.

So how did Marx arrive at such a radical view? Capitalism was just developing when Marx was writing, but already he could see how different it was from previous societies.

For most of human history people had worked primarily for their own consumption. They produced things that met their needs directly, whether it was food grown on their land or clothes they made at home.

In contrast, capitalism is all about commodity production – things are produced not for immediate use but as commodities to be sold on the market.

Commodities do have to be of some use eventually, but they have to be exchanged for money before the producers can get any benefit from their efforts. Therefore all commodities have what Marx called an “exchange value”. Their price reflects this exchange value.

But how is this exchange value determined? Marx argued that the one thing all the very different commodities bought and sold under capitalism have in common is that they are products of human labour. It is this that provides the basis for exchange.

In previous societies, before money was universally used, people would swap or barter items with one another. How much or how little was exchanged would generally depend on how long people had taken to make the items.

Two people would only swap items if they felt it had taken roughly the same amount of time for each to make their items – otherwise it would not seem like a fair deal. It was not just an exchange of things that had taken place but an exchange of the labour time of the people involved.

The method of barter is obviously very time consuming and inefficient. As commodity production increased, the use of money became more important as a way of equating different products.

Previously one table may have been swapped for two chairs based on the amount of labour time used. Now one table may equal £10, and therefore one chair would equal £5.

The price charged still reflects the amount of labour time gone into making the product, but the use of money – since it can be exchanged for any commodity – cuts out the need for direct exchange between producers.

Money allows us to equate things that seem to have nothing in common, in terms of materials, how they have been made or their actual use.

Because of this money appears to be the goal of production under capitalism. Acquiring it often feels like our own personal goal, since it will enable us to buy the things for a better life. Therefore it can seem like money is the source of value.

But money only has value to the extent that it gives you a claim on the labour of others. If you had stacks of money, but nothing was being produced, then it would be no use.

It is the common element of human labour that allows us to measure how much a particular commodity should be sold for on the market.

And it is this that Marx argued determines their value. The price of a commodity reflects the labour time needed to produce it.

So far it still seems as if everyone is on a more or less equal footing. But if all commodities are exchanged according to amount of labour needed to produce them, where does profit come from?

The answer lies in the relationship between the capitalist and wage labour. Under capitalism, our ability to work – Marx called this our “labour power” – is also a commodity to be bought and sold like everything else.

No secret

This is not a secret. We talk of “joining the labour market” after finishing education. We try to make ourselves more “marketable” to employers.

Workers sell their ability to labour (their labour power) to a particular employer or capitalist for an agreed price (our wage).

Our labour power is extremely useful to the capitalist since it is able to create all sorts of products. But how is its exchange value ultimately determined?

The price of labour power is determined just like that of any other commodity. It depends on the amount of labour required to produce it.

Now behind the term labour power lies a human being, although the capitalists often like to forget this. So workers get paid enough money to keep them going.

You get enough money for food, the cost of your rent or mortgage, clothing and enough rest time to enable you to arrive at work each morning able to put in the required amount of effort and attention.

So what determines wages is the cost of living in a society. You go to work where you create products for the capitalist. In return you get money – your wage – with which you buy the different products you need to live, products that have themselves been created by other people’s labour.

This still seems quite fair, since you get paid the amount needed to cover your cost of living.

But there is a difference between the amount you are paid for your labour power and the value that your labour creates when you work.

For example, it may only take four hours of society’s total labour to produce the things you and your family require. So by lunchtime, you have covered your wage and by rights you should go home.

But you do not stop work then. You go back to work in the afternoon and perhaps do an eight hour day. If four hours of your labour has created enough value to pay your wage, then the capitalist takes the next four hours of work from you for nothing.

Pocketing profits

In this example the capitalist is able to pocket a “surplus” of four labour hours a day from each worker. This is what Marx called “surplus value”, which is the source of profit.

Your labour creates more value than the value of your labour power. So exploitation is not an anomaly under capitalism – it is part of the normal workings of the system.

But there is another side to exploitation. The problem for capitalists is that when they buy labour power, what they get are people who can think and act for themselves.

Most people do not go into work thinking their wages should just cover the minimum required to enable them to keep on working another day. Instead we look at the tremendous wealth in society and think – rightly – that we are entitled to a better standard of living.

So there is a continual struggle over the cost of labour power. Battles over pay break out regularly, especially at times when the real cost of living is going up.

If exploitation is crucial to capitalism, the logical conclusion is that an end to exploitation would require an end to capitalism.

But all the day to day battles over pay and conditions represent more limited battles against exploitation.

If we win some of these battles, it gives workers the confidence and strength to win more. It also helps us to win the battle of ideas to convince people that we have to get rid of the whole system.

Marx’s labour theory of value identifies labour as the source of value. It exposes how capitalists steal part of the value that our labour produces.

But this theory is not just a commentary on the system we live under. It is a weapon for workers who want to fight to get rid of the system of capitalism – and end exploitation forever.

Source: Socialist Worker

Further reading

Karl Marx’s Wages, Price and Profit is an account of his theories written for an audience of workers. Chris Harman’s Explaining the Crisis looks at how Marx’s insights shed light on the problems of capitalism today. Marx’s Capital by Ben Fine and Alfredo Saad-Filho is a good introduction to Marx’s major work. All are available from Bookmarks, the socialist bookshop, phone 020 7637 1848, » www.bookmarks.uk.com

© Copyright Socialist Worker (unless otherwise stated). You may republish if you include an active link to the original and leave this notice in place.

Is that how it goes? Or:

• It takes a heap o' firearms on your pool table
• It takes a heap o' inebriated pool urination
• It takes a heap o' erotic exotic cheeses
• It takes a heap o' moron bloggers
• It takes a heap o' homos cuddling on the couch

I don't know. One of those. I link this* only so those who might not be receiving enough inspiration from Pure Lutheran Doctrine^BS might have all options before them.

It basically says you'll be better off buying a smaller house with a short commute than buying a large house with a long commute because you give inordinate consideration to the occasional gatherings of family and assorted moochers who might be looking for an excuse to drop in.

Of course Michael is his own man. Therefore it is probably for the best that he go through with the large house purchase and quickly have it fitted with plenty of bunk beds and condom dispensers.

*I can't hat tip where I found this. You would ban me.

Job security is largely seen as old fashioned these days. People are downsized as soon as their salaries get too large and the business feels they can be easily replaced with a cheaper and less expensive worker-widget. Likewise, employees are just as likely to jump ship as soon as a more attractive offer comes along. But what is the fall out from all this movement, seeking out the better, cheaper and faster ways to accomplish everything?

I think the interesting contrast here is when there is no longer any "job security", there is no reason for employees to have any loyalty to the greater mission or goals of the enterprise, no matter what the size. Therefore, their only core motivation has to be what is best for them and their families- a mercenary "available to highest bidder" mentality. And why should it be different? With no social contract between the employee and employer anymore, other than that of health care and any remaining employee benefits, there is no reason to stick around and keep your money on the table, so to speak, with your employer, since they are just as likely to terminate you without any warning at their earliest convenience. And should you bother to "do the right thing" and provide notice? Why? The favor is rarely returned in kind. The social contract is (has) disintegrated over time- there are no more rules as to what is appropriate.

I grew up in Rochester NY, a company town with Kodak, Xerox and more for many years. The decline of "cradle to grave" job security has changed the nature of the community, now making the town more transient than ever before. People go where the job is more and more rather than stay in their current situation if a job is terminated. Families rarely live in the same town where one or both parents grew up. The social ties of living in a place where everyone knows your name is becoming an anachronism more and more.

This means less long term investment in social infrastructure in real life communities, like museums, art galleries, churches, charitable organizations, etc. Why should people spend their precious time and resources supporting the community when they are just transient residents in nature, and will never personally benefit from any of the good they are doing? Regular towns and cities are becoming mere way stations along a pathway of jobs, and people have no more incentive to make a long term investment in the success of schools or civic organizations than summer time residents of beach communities do in making sure those towns are sustainable 365 days of the year. They only care that their needs are met at a price they can afford during their brief stint to pump some money into the local economy, and then their contribution is over.

This is true just about everywhere- we are seeing the same transition happen in Wilmington, DE now that MBNA has been bought out by Bank of America. The lack of job security means lack of loyalty on both the part of the employer and employee, and people speak of just doing what they have to to get by, not investing in any sort of larger sense of contributing to a company- they are just collecting a paycheck, nothing more.

I agree businesses can't necessarily be job charities, but by totally forgoing the social contract of employment, they gain no loyalty and thus the same people who businesses have invested time and money to train and educate have no reason to stay in that position if they can get a better deal elsewhere. I'm not sure this is necessarily a long-term success strategy for helping all boats to rise, so to speak, but it does create cut throat competition where people become more isolated and only concerned for themselves. You can't expect people to "take one for the team" and act altruistically if the team is unlikely to return the favor.

What do you think? How do we balance efficiency and economics with the importance of building sustainable communities for the long term? Is it possible?

NotionsCapital presents this week’s Roll of Shame, Washington, DC area music venues that advertise “Live Music” but do not include the names of bands in their ads. You may think this is a mere quibble. Think again.

It is not just a matter of disrespect. Bands earn reputations, and omitting their names from advertising fails to capitalize on this. Since venues rate bands on the number of customers they draw, failure to list band names in ads blames bands for the venue’s own ignorance and laziness.

As one commenter says: “It’s like a restaurant implying that they serve food and then only listing the word ‘Food’ on every line of their menu.”

Bad enough that club musicians haven’t had a raise in 40 years. Bad enough that most clubs leave it to the bands to send information to the free listings in the City Paper and Post. This generic ad stuff is plain absurd.

You can help. Let NotionsCapital know if you see a venue with a “Live Music” sign in the window that doesn’t display the name of the band. Joe’s Bar says the band schedule is on the website? You cannot click on a URL in a newspaper. Joe’s Bar claims the band is named “The Joe’s Bar Band?” I don’t think so.

This is the time of year that business for pricier D.C. restaurants is sort of slack, and managers respond by pulling their newspaper ads. Hmm. That will bring folks in. Anyway, festivals fester in the summer sun, and some of them advertise “live entertainment” and “live music” too, so they’re on the list. Here is this week’s Roll of Shame, based on paid advertising in the current Washington City Paper and Washington Post Weekend section:

Beacon Bar and Grill

City Paper Crafty Bastards

Kramerbooks & Afterwords Cafe & Grill

Market Inn

The Republic

No band names in your ads? No hyperlinks for you on this post. Get with the program.

 Image by Mike Licht, who likes to go to several of the venues above (Get it together, people!) Download a copy here.Creative Commons license; credit Mike Licht, NotionsCapital.com

There are some out there who say this is because of George Bush's announcement dropping the ban on oil exploration and development on the outer continental shelf. And by some, I mean noted political hack, Larry Kudlow.

One of the biggest problems with analysis out there is that everyone ignores the first rule of statistics: correlation does not mean causation. Just because A went up at the same time B went down, doesn't mean that A caused B to go down. They could be completely unrelated items. Most medical "studies" do exactly this.

Saying that Bush caused oil markets to go down completely ignores other much more pertinent information. Such as demand dropping, more information coming available that was the opposite of what those evil speculators were betting including increased supply and oil imports, not to mention a strengthening dollar.

Note that in not one of those stories was the Bush did anything mentioned. In fact, all of those things happened independently of some inconsequential announcement that the President made. In fact, as long as the law on the books says that no new areas are open to exploration, then the price shouldn't change one penny.

(Note: the fact that the President can make law is pretty much unconstitutional. If Congress repealed the ban and the President still had the executive order, then I'm pretty sure that the presidential order would be unconstitutional).

So the lesson to take out of all this is that, the markets still work, and the laws of supply and demand say nothing about what the role of a president at all.

Whose utopia, yours? Or perhaps the person standing over there? It is my utopia, do I have the power to make change, or do you? 

A tear in the eye, beauty in the eye, the beholder beholds A mother’s mother, all grown up, still the child.

Still the born, a journey of pain, it can be good, you can listen.

Can you speak?

Speak you can.

You can speak.

I have spoken through my tears, I have spoken through my pain, I have spoken through my words, and I have spoken for you to hear.

Something like that, though it's likely we can contain the damage an awful lot if we act quickly and intelligently, if we're willing to start making sacrifices of comfort and luxuries now to avoid the large-scale death of the vulnerable, children and elderly and the sick, as it becomes more difficult to heat houses and public buildings. What if there are major disruptions in the transportation systems of countries so advanced that they have only a three or four day supply of food in their local grocers and their warehouses?

We have a moral crisis before we have an oil crisis or a financial crisis or an immigration crisis or any other sort of crisis.

We in the modern world have lost our way and have no coherent understanding of who we are as a concrete people, that is, as inhabitants of particular regions and specific communities. We have accepted a change in our lives, in the very locations where we spend out times. Rather than inhabiting homes and neighborhoods and communities of worship, we live in the marketplaces of the modern world.

Where are our moral leaders? Where are the town fathers, the priests and minsters and rabbis, the leaders of ethnic associations? Human societies are about to be reshaped and those who claim to be our leaders are nowhere to be found, though they're ready to identify themselves when it comes to spending some of our money or claiming the seats of honor at banquets. Are they going to stand in the shadows as the wolves once more come down upon the scattered flocks? Are the shepherds counting the money they get from the wolves to better care for those sheep who will be next year's meals? Are they perhaps themselves well-intentioned but weak, gathering in those shadows with the well-intentioned but weak members of their flocks?

Detailed Statistics

• The agricultural fertilizers and supplies, chemicals, recycled materials and paper products sector recorded its strongest gain this year as current dollar sales rose 9.5 percent to $6.4 billion in May.

• The agricultural fertilizers and fertilizer materials were 57.7 percent higher in May compared with the same month in 2007.

• Farm products posted their largest monthly increase in two years, with sales rising 7.3 percent in May to $474.6 million, after decreasing in the first five months of 2008.

Reference Source: Statistics Canada

The notion that crises create fertile terrain for political change, far from being a ghoulish doctrine unique to free-market radicals, is a banal and ideologically universal fact. (Indeed, it began its dubious modern career in the orbit of Marxism, where it was known as "sharpening the contradictions.") Entrenched interests and public opinion tend to run against sweeping reform, good or bad, during times of peace and prosperity. Liberals could not have enacted the New Deal without the Great Depression. Communist revolutions have generally come about in the wake of wars. The liberal economist Victor R. Fuchs once wrote that "national health insurance will probably come to the United States in the wake of a major change in the political climate, the kind of change that often accompanies a war, a depression, or large-scale civil unrest."

Fuchs did not mean that the public would never accept universal health insurance unless they had been brutalized into doing so. Nor was his observation evidence that he longed for disaster to befall the United States. Most American liberals today would admit that the sorry state of the American economy, foreign policy, and political life has created a golden opportunity for progressive reform. There is nothing odious about this. Yet Klein takes analogous observations from conservatives as proof that the right "prays for crisis the way drought-stricken farmers pray for rain."

Check ıt out.

Reference Source: The Wall Street Journal

I don't say that because I have oil company stock.  I don't.  I don't say that because I have lots of money and don't care about the price of gas.  I'm not rich, and I do care.  The rising gas prices have screwed up my personal finances just like everyone else.  But anyone who takes global warming seriously, and I do, has to realize that high gas prices are a good thing in the long run.

As H. Beam Piper noted in Space Viking, good things in the long run are often very unpleasant while they are happening.

Skyrocketing gas prices are finally getting people out of SUVs and into fuel efficient cars.  Four-day work weeks are suddenly seeming reasonable to a whole lot of people who sneered at them before.  Mass transit ridership is up, as is telecommuting and college classes over the internet.  All of these things have been advocated for years by people who are concerned about the environment, but it took high gas prices to get people to actually do them.

Will these trends continue if gas prices drop?  My experience says no.  We made some of the same changes during the last oil crisis, and abandoned them as soon as gas was cheap again.  Which is why I am not sure that falling oil prices are a good thing.  If I thought that this was the good scare we needed to break our addiction to oil, then I would be happy to get gas prices back down to where I'm not having to think about how much each trip is costing me in gas, but as a society we are more inclined to turn the oxygen off for a few minutes so we can smoke another cigarette than to actually break our addiction.

I've been thinking about this since the prices started going up, but a post by Mike the Mad Biologist brought it to a head.  The post points out that we have been subsidizing cars through road building and maintenance that is not covered by gas taxes, yet people complain about subsidizing mass transit.  We subsidize all transit systems, and it may be time to start looking at total cost in making decisions about what kind of transit gets priority in funding.

And so, my reluctant conclusion that high gas prices may be a good thing in the long run is not entirely based on the schadenfreude I experience watching someone fill the tank on their Hummer.