Reference: The Fraud-Based US Economy

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The attached blog,  “Failing to Prosecute Wall Street Fraud Is Extending Our Economic Problems,”

is a cut-and-paste accumulation of a variety of outlooks. Most are  based on analyses or accumulated wisdom, but some appear based on hunches, ideologies, etc.  Taken together, however, they paint a horrifying picture of the American political economy and our prospects for the future.  Moreover, that picture does not change materially if you throw half of the pastings away.  While the implications of fraud, per se, are clear, the horrifying picture of what is happening emerges when one tries to generalize on the description.

The anonymous guest author is telling us, in effect, that the neural network of our political-economy — i.e., the information system that provides the wherewithal for implicit and explicit homeostatic guidance and control – – has become so corrupted by fraud and disinformation that a pervasive atmosphere of confusion, menace, fear, mistrust, and alienation is breaking down the system into non-co-operative activities, thereby creating a kind of paralysis of will that, left unchecked, will prolong and deepen our economic crisis. <

One psychologist insightfully likened the situation to trauma and post traumatic stress disorder on a national scale.

Any student of Colonel Boyd's theory [1] of competition and conflict (Patterns of Conflict) and his idea of the OODA loop will immediately recognize the symptoms of confusion, menace, fear, mistrust, and alienation, expressed below.  These are the emergent properties of decision cycles, or Observation – Orientation – Decision – Action (OODA) Loops, that have been folded back inside themselves and have become focused inward and are disconnected from their environments, but connected to some kind of internal dynamic that feeds on itself. Of course, Boyd was discussing military strategy and the art of winning by wrecking his adversary's OODA loops to undermine his adversary's organic cohesion, while preventing his adversary from doing the same thing to him.

Nevertheless, it would be a mistake to dismiss his ideas as applying only to the art of war.  That is because Boyd's aim was to describe in a generalized sense how the human mind works in any conflict involving a clash of independent wills, what the mind's  strengths and weaknesses are, and how these strengths and weaknesses play out in the competition that is the essence of life.

So, it should not be surprising that many politicians, businessmen, and scholars  have recognized that Boyd's general ideas can be tailored to any kind of competition or game (just google “OODA loop”) and have sought gain by exploiting these ideas against others.  Most people, however, instinctively evolve  similar if less well defined ideas, because if Boyd's synthesis of the OODA loop is correct, these dynamics are innate in the evolved wiring of left and right hemispheres of our brains [2], and therefore will exhibit their outward manifestations in repetitive patterns in conflicts over time — which brings back to the tapestry of confusion, menace, fear, mistrust, and alienation and the counter weights that are necessary to overcome them.

Viewed through the lens of Boyd's theory of competition and conflict, the attached blog clarifies one question about the players in the economic game in particular: The information assembled below clearly shows who is the hoser and who is the hosee.

One final point, history has shown that once an nation's political-economic OODA loops become infected by the virus of corrupted information it is very very hard to clean it out.  The hosing will continue unless ruthless action roots it out, otherwise, we will experience continued disintegration ending in a sudden collapse, like what happened to Rome on a grand time scale or to France's Third Republic [3] on a more tangible time scale.

With this background in mind, now read the attached blog and draw you own conclusions about what is needed to re-oreint the corrupted political-economic OODA loops that are leading America to ruin.
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NOTES:

[1] A short bio of  Boyd and his theories as well as the briefing slides he used to explain his theories can be found in the Boyd folder here.  Robert Coram's excellent biography of Boyd and his theories can be found here.

[2] See, for example, my analysis of how Barack Obama beat Hillary Clinton and John McCain here.

[3]  William L. Shirer's Collapse of the Third Republic, is a case study in how the dry rot of inward focus in the 1930s set France up for its sudden collapse in during the German invasion of May 1940.  His description of how the flow information among the military and political leaders became corrupted during the invasion is a microcosm of how inwardly focused OODA loops, lubricate by menace, mistrust, and fear result inevitably in the breakdown of cohesion, paralysis, chaos, and collapse.

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ATTACHED BELOW THE LINE IN FULL for Information Availability Assurance Into the Future

Failing to Prosecute Wall Street Fraud Is Extending Our Economic Problems

Posted By Guest Author On December 15, 2010 @ 8:30 am In Think Tank

http://www.ritholtz.com/blog/2010/12/failing-to-prosecute-wall-street-fraud-is-extending-our-economic-problems/print/

Continue reading “Reference: The Fraud-Based US Economy”

Journal: US Gap Between Rich & Poor Widens by Factor of 10

Analysis, Budgets & Funding, Collaboration Zones, Communities of Practice, Corporations, Corruption, Methods & Process, Money, Banks & Concentrated Wealth, Policies, Power Behind-the-Scenes/Special Interests, Strategy, Threats
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Gap Between Rich and Poor Follows Geographic Lines, U.S. Census Data Shows

By Timothy R. Homan – Dec 15, 2010

Bloomberg

The gap between the haves and have- nots in the U.S. is being drawn along geographic lines, Census Bureau data showed yesterday.

The number of counties where median household income decreased is almost 10 times the number that saw an increase, according to a Bloomberg analysis of Census figures comparing an average of the years 2005-2009 with 2000. The government figures also showed a concentration of wealth and education in coastal states.

“The dispersion of income is larger than it’s ever been,” said Douglas Besharov, a professor at the University of Maryland’s School of Public Policy. “There used to be a much wider spread of incomes within geographic areas than there is now. There’s much more of a clumping together.”

Phi Beta Iota: In the 1970's an era when “whole systems” thinking tried to flourish only to be crushed by the emergent merger of the two-party tyranny and Wall Street, there was a vital comparative international studies reference, “Banks & Textor,” or more properly, Arthus S. Banks and Robert B. Textor, A Cross-Polity Survey (Cambridge, MA: MIT, 1963).  We strongly suspect that today the USA would be qualified a failed state, certainly so if the 1% of the population hoarding the bulk of the wealth were isolated as an extraneous factor contributing little of value to the larger economy while siphoning off one fifth of the asset value through legalized financial crime.   There is clearly a need for a return of the Banks & Textor model, but with the added sophistication of distinguishing between negative factors of domestic production (excessive concentration of wealth, legalized mortgage clearinghouse fraud, Wall Street derivatives fraud, and Federal Reserve fraud, prison factories and prisons, hospitals, and marginalized enterprises among others).

Journal: USA Slouching Toward Tyranny

08 Wild Cards, Collective Intelligence, Communities of Practice, Corruption, Counter-Oppression/Counter-Dictatorship Practices, Cultural Intelligence, Ethics, Journalism/Free-Press/Censorship, Methods & Process, Misinformation & Propaganda, Officers Call, Peace Intelligence, Policies, Power Behind-the-Scenes/Special Interests, Secrecy & Politics of Secrecy, Threats
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Bruce FeinBruce Fein

Author, American Empire: Before the Fall

Posted: December 10, 2010 02:42 PM

Slouching Towards Tyranny

The state of civil liberties and national security in the United States is alarming.

In the American Empire, the former are routinely crippled or lacerated in the false name of the latter. Trust in government plunges. Dangers are magnified manifold to wound constitutionally venerated freedoms. International terrorist suspects who have never attempted to kill an American are treated as existential threats to U.S sovereignty. Predator drones employed off the battlefield in Afghanistan, Pakistan, or Yemen are spawning more enemies than are killed. Habeas corpus is suspended. Military commissions denuded of due process and which combine judge, jury, and prosecutor in a single branch of government are substituted for independent civilian courts. Time-honored privacy rights are trampled. Torture or first cousin enhanced interrogation techniques are endorsed. Congressman Peter King (R. N.Y.), slated for the chairmanship of the Homeland Security Committee, insists that prosecutions of alleged international terrorists in civilian courts are intolerable because guilty verdicts are not guaranteed. The worst violations are dared by few, willed by more, but tolerated by virtually all.

The nation needs a new birth of freedom dedicated to the proposition that the life of a vassal or serf — even in absolute safety — is not worth living.

At present, procedural safeguards against injustice are jettisoned for the counter-constitutional dogma, “Better that many innocents suffer than that one culprit eludes punishment.” A craving for a risk-free and comfortable existence fuels the nation's war on individual freedom. Acceptance of risk, however, is the lifeblood of a free society. Every human sports DNA capable of anti-social behavior — even the saintly. The United States is headed for the same ruination as Athens for the same reasons penned by historian Edward Gibbon: “In the end, more than they wanted freedom, they wanted security. They wanted a comfortable life, and they lost it all — security, comfort, and freedom. When…the freedom they wished for was freedom from responsibility, then Athens ceased to be free.”

Contrary to longstanding orthodoxies, civil liberties and national security are more aligned than opposed. Scrupulous respect for freedom works hand-in-glove with national security by evoking unbegrudging loyalty among citizens eager to risk that last full measure of devotion to foil opponents and to maintain government of the people, by the people, and for the people. Patriotic soldiers are superior to mercenaries. Hessians were no match for the Minutemen in the American Revolutionary War. A military that fights more for love of country than fear or money will triumph. And love of country is elicited by the government's securing unalienable rights to life, liberty, and the pursuit of happiness.

Read the rest of this specific article….

See Also:

Personal for Mike Bloomberg (Huffington Post)

Empire of Lies & Secrecy (Huffington Post)

Journal: Bribes from US Okay, from Venezuela Not OK

07 Other Atrocities, 07 Venezuela, 08 Wild Cards, Corruption
Marcus Aurelius Recommends

Nicaragua Government Took Bribes From Drug Traffickers, Cable Says

December 9, 2010

Nicaragua’s President Daniel Ortega’s government accepts bribes from drug traffickers, harbors terrorists and attempts to endear itself to Iran, according to leaked U.S. diplomatic cables.

By Samuel Rubenfeld

U.S. diplomats accused Nicaraguan President Daniel Ortega’s government of taking bribes from drug traffickers in exchange for freeing suspects, in cables released by Wikileaks.

The bribes formed a kind of “judicial ‘campaign finance’ machine” in return for not-guilty verdicts, according to a May 5, 2006, cable from the U.S. Embassy in Manangua, Nicaragua. It says the ruling Sandinista party regularly accepted cash from drug traffickers, “usually in return for ordering Sandinista judges to allow traffickers caught by the police and military to go free.” The scheme, the cable said, was run by the director of the state security service and overseen by Supreme Court judges, including Rafael Solis and Roger Camillo Arguello.

Read full article….

Phi Beta Iota:  What US diplomats don't get is that CIA lies to them all the time, and very often is also paying the same people while sanctioning the drug trans-shipments.  Similarly, DEA and the FBI cut deals.  The single best known case with respect to Nicaragua and the CIA destroying an entire black population in the USA dealt with Contra leader Blandon, a strategic-level (massive) drug exporter.  This is told inReview: Dark Alliance–The CIA, the Contras, and the Crack Cocaine Explosion.  Hark back to Panama and General Noriega, who regularly received warm assurances (as well as serious cash payments) from CIA, in some cases from Bill Casey personally, to the effect that as long as he allowed CIA support for the Contras out of Panama, all drug-related matters were “off the table.”  It was an ambitious attorney general in Florida that actually undid that deal.  What CIA has done in our name–what the Pentagon and Special Forces have done in our name–is reprehensible.  Tim Wiener has it right in Review: Legacy of Ashes–The History of the CIA and so do General Smedley Butler, USMC (Ret) in Review: War is a Racket–The Antiwar Classic by America’s Most Decorated Soldier and James Carroll in Review: House of War.  ENOUGH!

See Also:

Journal: CIA and the Culture of Corruption

Journal: Nato’s Secret Armies (It’s Not Terror if CIA Pays and Locals Do the Dirty….)

Worth a Look: Book Reviews on Corruption

Worth a Look: Book Reviews on Dereliction of Duty (Defense)

Worth a Look: Book Reviews on Disinformation, Other Information Pathologies, & Repression

Worth a Look: Book Reviews on Empire as Cancer Including Betrayal & Deceit

Worth a Look: Impeachable Offenses, Modern & Historic

Worth a Look: Book Reviews on Intelligence (Lack Of)

Journal: US Army Civil Affairs Left for Dead…

08 Wild Cards, Civil Society, Corruption, Government, Methods & Process, Military, Non-Governmental, Officers Call, Policies

14 December 2010 CRYTOME

US Army Starving its Civil Affairs Functions: Prefers New Age HTS, PRT’s

by John Stanton

“If the expansion of the Human Terrain System gains traction at TRADOC it could kill any efforts to develop a cultural expertise construct by the Civil Affairs community, specifically the Civil Affairs Proponent at USA JFK SWCS. Everybody is looking to get as much money as they can for their organizations as the Defense budget begins to get squeezed. Naturally there could be a potential dog fight between TRADOC and any other Army organization making claims for HTS-like capability. Once something becomes institutionalized in the military it is difficult to change the new status quo.”

Read full article….

Phi Beta Iota: The US Army Civil Affairs Brigade got off to a very good start under Col Ferd Irizzarry, USA, and then he got sent to Afghanistan to punch his pre-flag combat operations ticket and it took a nose dive.  HRT is the most badly managed–unethically managed–program in the DoD Human Intelligence inventory.  While recognizing that the author above is on a vendetta against HRT, the bottom-line is that he is right, HRT is wrong, and TRADOC does not know the difference.

See Also:

2010: Human Intelligence (HUMINT) Trilogy Updated

Journal: Sun Tzu is with the Taliban in Afghanistan

02 Diplomacy, 03 Economy, 07 Other Atrocities, 08 Wild Cards, 10 Security, 11 Society, Budgets & Funding, Civil Society, Commerce, Corruption, Cultural Intelligence, Military, Non-Governmental, Officers Call, Peace Intelligence
Chuck Spinney Sounds Off....

December 14, 2010

Memo From Sun Tzu to President Obama

Who is the Wise General in Afghanistan?

By FRANKLIN C. SPINNEY Counterpunch

In the first treatise written on the art of war, sometime around 450 BC [1], Sun Tzu explained why “the wise general sees to it that his troops feed on the enemy,”

EXTRACT:  The militarization of development aid is a central pillar of General Petaeus's counterinsurgency strategy to buy the hearts and minds of the Afghan people, ninety per cent of whom are spread out in remote rural areas. So it should not be surprising that the military is controlling the bulk of the billions of dollars in aid money flowing into (and being smuggled out of) Afghanistan.

In the very important CounterPunch report on 13 December, Patrick Cockburn, certainly one of the most informed observers of insurgencies in the Middle East and Central Asia, described how the militarization of development aid in Afghanistan is riven with corruption.

Read full article….

Journal: The Wall Street Pentagon Papers–Biggest Scam In World History Exposed–Are The Federal Reserve’s Crimes Too Big To Comprehend?

03 Economy, 07 Other Atrocities, 09 Justice, 11 Society, Commerce, Commercial Intelligence, Corruption, Cultural Intelligence, Government
WANTED

The Wall Street Pentagon Papers: Biggest Scam In World History Exposed: Are The Federal Reserve’s Crimes Too Big To Comprehend?

By David DeGraw
The Public Record
Dec 10th, 2010

What if the greatest scam ever perpetrated was blatantly exposed, and the US media didn’t cover it? Does that mean the scam could keep going? That’s what we are about to find out.

. . . . . . .

The Fed doled out $12.3 trillion in near-zero interest loans, using the American people as collateral, demanding nothing in return, other than a bunch of toxic assets in some cases. They only gave this money to a select group of insiders, at a time when very few had any money because all these same insiders and speculators crashed the system.Do you get that? The very people most responsible for crashing the system, were then rewarded with trillions of our dollars. This gave that select group of insiders unlimited power to seize control of assets and have unprecedented leverage over almost everything within their economies – crony capitalism on steroids.

Read full blast….