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Temporarily, these financial and military oligarchs need to work through the US government

because it is the government that carries the authority to print dollars as long as the dollar

remains the reserve currency of the world. This downgrade of the US credit rating is

part of the forward planning by the top capitalists to guarantee the political and military

hegemony of the richest one per cent of the US population.

 

 

Books by Horace Campbell

Barack Obama and 21st Century Politics  / Pan-Africanism, Pan-Africanists, and African Liberation in the 21st Century

Reclaiming Zimbabwe  /  Rasta and Resistance: From Marcus Garvey to Walter Rodney

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 Chickens Are Coming Home to Roost

US Credit Downgrade by Standard & Poor’s

By Horace Campbell

 

11 August 2011

On Friday 5 August 2011, one of the world’s leading credit rating agencies, Standard & Poor’s (S&P), downgraded the United States’ top-notch AAA rating for the first time ever in the United States’ history. S&P cut the long-term US rating down to AA+ with a negative outlook, citing concerns about budget deficits and political gridlock. In their statement justifying the downgrade S&P stated that:

The downgrade reflects our opinion that the fiscal consolidation plan that Congress and the administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics.

More broadly, the downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges.

Additionally, Standard & Poor’s indicated that it might further lower the US long-term credit rating to AA within the next two years if the United States’ deficit reduction measures were deemed inadequate. These are strong statements from a private agency bent on disciplining the government of the United States with the threat of a further downgrade. What gives this agency such power? In answering this question, we would seek to understand what is a credit rating agency; the source of a credit rating agency’s power; what is S&P’s track record and what implications do its decisions have for the international political system, especially for humanity.

In all major capitalist countries, the power of the dominant faction is hidden behind ideology (free market), law (protection of private property), propaganda (corporate-controlled media), the coercive organs of the state (military, police and prison) and the power of finance capital (banks, insurance and financial instruments). Credit rating agencies represent the power of financial capitalists and are usually held in the background to discipline corporations and governments. In moments of crisis these agencies show their hand.

These agencies along with the International Monetary Fund (IMF) and the US military have been the weapons against the true self-determination of humanity. United States citizens are now beginning to pay attention to the power that the IMF, credit rating agencies and the military wielded over most countries in the world. US Treasuries (or T-bills) are traditionally considered to be a risk-free investment precisely because in the country’s 200+ year history, its rating has never been downgraded and the securities are backed by the government.

The downgrade of the credit rating of the United States by Standard & Poor’s is much more than a psychological blow to the prestige of the imperial overlords in the United States. This is a sign of a power shift and another blow to the position of the US as the sole superpower. The most oppressed must organise to break the power of capital and the imperial overlords or humanity will pay a high price.

What Is a Credit Rating Agency?

Credit rating agencies provide information on issuers of securities whether the issuers are corporations or countries. A credit rating agency informs investors whether issuers of securities (such as debt obligations, fixed income securities) can meet their obligations to those securities. The top three credit rating agencies with international influence are Standard & Poor’s, Fitch Ratings, and Moody’s Investor Services. The job of these agencies is to provide an analysis of the risk posed to investors by bonds, companies and countries. The risk analysis provided to investors by the credit rating agencies is supposed to be objective. However, the credit rating agencies are private entities owned by profit-making companies performing what is essentially a regulatory role. Thus, the credit rating agencies cannot truly serve the investing public because they have a fiduciary obligation to their shareholders to maximise profit.

The rating agencies achieved their influence over time since the capitalist depression of the 1930s but have become more important to the US economy in the era of financialisation, commencing on 15 August 1971. It was from this date that the US gave unlimited rights to the currency speculators after it reneged on the Articles of Agreement of the IMF that had placed the convertibility of the dollar on par with US$35 for one ounce of gold. This departure from the gold standard, called the ‘Nixon Shock’ after the president who authorised it now backed the US dollar with the military might of the United States. During the Cold War, international capitalists were willing to shelter under the US military umbrella and one price for this shelter was to accept the political power of US credit rating agencies.

These private corporations were issued permits to be credit rating agencies by the United States Securities and Exchange Commission through the Nationally Recognized Statistical Rating Organization (NRSRO) therefore turning rating agencies from solely private entities into regulating bodies.

In the past 20 years, the business of credit rating followed the path of centralisation and concentration of capital so that the rating business fell in the lap of the three big firms, affording these organisations the power to make life and death decisions about corporations and countries.

The subjective nature of their ratings will be brought out later but in the aftermath of the clear theft and fraud of the capitalist organization called Enron, the rating agencies in public hearings held by the SEC in 2002 insisted that credit ratings were only opinions and should have a limited role which is to assess the creditworthiness of issuers on an ongoing basis, and the ‘likelihood’ that debt will be repaid in a timely manner. The fact that ratings are ‘opinions’ is important in the US legal context in that these big three capitalist corporations seek to be protected by the First Amendment and from civil and criminal liability.

From Where Do Credit Rating Agencies Get Their Power?

These credit rating agencies earn their power from the fact that they are owned by the top financial institutions on Wall Street. For example, S&P is owned by McGraw Hill Companies, one of the United States’ big media and publishing conglomerates. The board of directors is comprised of the top individuals of finance capital with a few academics thrown in. The shareholders of McGraw Hill are from the top financial houses. McGraw Hill owns Aviation Week, which is one of the prime advocates for a section of the US military. Though S&P is a wholly owned subsidiary of McGraw Hill, Moody's, on the other hand, is a publicly-traded corporation. Its largest single shareholder, with 12 per cent of the company's shares, is Berkshire Hathaway, Warren Buffett's company. Fitch is more transnational with roots in French finance capital.

Thus, we know that the shareholders of McGraw Hill can ensure that their ratings are sanctified by governmental authorities and most importantly, by the IMF. The power of these credit rating agencies has accumulated over time and has been consolidated within the context of the power of finance capital over the international capitalist economy. By seizing a regulatory role while eschewing clear liability, these agencies gained the political power to be whatever they wanted to be.

Since the Depression of the 1930s, statutes and rules required that mutual fund and money managers of almost every stripe buy only those bonds that have been given high grades by a Nationally Recognized Statistical Rating Organization. The effect was to make the three certified rating agencies an oligopoly. It was this power that these agencies used against Asia by providing cover for US companies to buy up assets cheaply in the aftermath of the Asian financial crisis (1997-98). This power also played a role in the recent intimidation of European countries, including Greece, Portugal, Ireland, and Iceland, to launch austerity measures against workers by downgrading the ratings of these countries.

Power Struggles Within the International Capitalist System

There are numerous commentaries on the downgrade of the US but the one commentary that caught my attention was that of Paul Craig Roberts, former assistant secretary of the Treasury in the Reagan administration and associate editor and columnist at the Wall Street Journal. This is a civil libertarian who was arguing that there is a struggle between the military and Wall Street for power in the USA. In an article published on counterpunch.com, after quoting from the statements of Dwight Eisenhower on the rise of the military industrial complex, Roberts opined that from the time of Dwight Eisenhower till today, the United States has been dominated by the military security complex. According to this analysis of the downgrade, the only challenge to the military was Wall Street and Wall Street was using this downgrade as its leverage to fortify its challenge:

‘The main power rival was Wall Street, which controls finance and money and is skilled at advancing its interests through economic policy arguments. With the financial deregulation that began during the Clinton presidency, Wall Street became all powerful. Wall Street controls the Treasury and the Federal Reserve, and the levers of money are more powerful than the levers of armaments. Moreover, Wall Street is better at intrigue than the CIA. The behind the scenes fight for power is between these two powerful interest groups. America’s hegemony over the world is financial, not military. The military/security complex’s attempt to catch up is endangering the dollar and US financial hegemony.’

Roberts explained that the security establishment has been trying to catch up with the power of the lords of finance by launching wars to enrich themselves and to gain more power in the society:

‘The country has been at war for a decade, running up enormous bills that have enriched the military/security complex. Wall Street’s profits ran even higher. However, by achieving what economist Michael Hudson calls the ‘Financialization of the economy,’ the financial sector over-reached. The enormous sums represented by financial instruments are many times larger than the real economy on which they are based. When financial claims dwarf the size of the underlying real economy, massive instability is present.

‘Aware of its predicament, Wall Street has sent a shot across the bow with the S&P’s downgrade of the US credit rating. Spending must be reined in, and the only obvious chunk of spending that can be cut without throwing millions of Americans into the streets is the wars.’

While notable, what this analysis by Paul Craig Roberts fails to recognise is the rapid integration between finance capital and the military, as manifest by the fact that companies that profit greatly from militarisation, such as Boeing has an established financial arm called Boeing Capital Corporation. Most of the big investment and derivatives firms have established links with the private military industry. All the top private military companies and the military hardware manufacturers that are woven into the military-industrial complex are traded on Wall Street. Many of the top private military companies are subsidiaries of Fortune 500 companies that are also traded on Wall Street.

In fact, the intricate web of alliance between finance capital, the military and the corporate media/information mind control is now so dominant that we can talk of the finance-military-information complex, instead of the military-industrial complex. McGraw Hill is a poster child of the relationship between the military, finance and information/media. McGraw Hill is the owner of Standard and Poor’s, and it is directly owned by some of the biggest bankers of Wall Street. McGraw Hill is also in the TV and media business, with stations across the country. It owns Aviation Week and Space Technology. The latter has been the publication that has been the mouthpiece for the US Air Force, and has been an advocate for high military spending and the acquisition of expensive military aircrafts.

As promoters of the ideology of free market and deregulation (even in the military), the McGraw Hill Companies is also a cheerleader for private military corporations. These private military corporations are involved in protecting international capital in all parts of the world The New York Times reported as far back as 2002 that one such private contracting firm ‘boasts of having “more generals per square foot than in the Pentagon.”’ As a militarist state where all is subordinated to the needs of the financial/military interests, there is no contradiction between the two as Roberts claims.

As international capitalists with no cut-in-stone loyalty to the US state, the financial-military complex is now ready to do to the US what it had been doing to the rest of the world since 1945, intervening to discipline governments to do the bidding of big capital. Temporarily, these financial and military oligarchs need to work through the US government because it is the government that carries the authority to print dollars as long as the dollar remains the reserve currency of the world. This downgrade of the US credit rating is part of the forward planning by the top capitalists to guarantee the political and military hegemony of the richest one per cent of the US population.

As the dollar loses its status there will be consequences for the global position of American capitalism. The moguls of Wall Street want to ensure that the political leadership in the United States is sufficiently intimidated so that as the position of the dollar deteriorates and there are deepening crisis for capitalism inside the US, the government will take measures to continue to ensure that wealth is transferred from the working peoples to the capitalist class. Hence this downgrade is part of a long term plan to discipline the working class and the politicians within the United States, just as how the IMF has been used in the past against the rest of the world.

The Track Record and Credibility of the rating Agencies

It is now known that Enron was one of the most corrupt capitalist corporations in the US. Yet, Enron had a triple AAA rating by these credit rating agencies until four days before the company went bankrupt. When the full extent of the fraudulent activities of Enron were revealed, President George W. Bush claimed that this was one ‘bad apple’, implying that Enron was an aberration. But soon thereafter the duplicitous dealings and accounting practices of WorldCom and Global Crossing were revealed—WorldCom fudged accounts to show inflated profits. Up to the day that Enron sought bankruptcy protection, none of the three rating agencies caught the fraud and corruption of Enron.

Throughout the period of the power of the financial houses, the blatant conflict of interest was too hard to ignore so in the aftermath of Enron and WorldCom, there has been some regulatory response. Congress passed the Credit Rating Agency Reform Act of 2006, ending a century of industry self-regulation. The purpose of this law was to promote competition in the rating industry by establishing a transparent and rational registration system for rating agencies seeking NRSRO status. It was also designed to enhance industry transparency, address conflicts of interest, and prohibit abusive practices.

But the Securities and Exchange Commission (SEC) was itself impotent as the world saw from the financial crisis of the collapse of the investment banks in 2008. Bear Stearns and Lehman Brothers had enjoyed top ratings from these agencies and the sub-prime products called Credit Default Obligations (CDOs) were given triple AAA ratings, even when these products turned out to be garbage. Of course, this garbage was held by the same bankers who own the rating agencies.

In the aftermath of the fall of Lehman Brothers and the fact that the sub-prime mortgage crisis exposed the securities fraud by the financial houses, for a short time Wall Street was on the defensive. There were dozens of lawsuits filed against the credit rating agencies. Citizens were calling for the fraudsters to be incarcerated but the rating agencies went back to their old line that their ratings are merely opinions and are protected by the First Amendment.

It was then left to Congress to Act and after the public outrage, the financial regulatory reform law adopted in 2010, known as Dodd-Frank Law, directed the SEC and other agencies to undo that link between the ‘opinions’ of the credit rating agencies and the claim that they could regulate themselves.

The Dodd-Frank Wall Street Reform and Consumer Protection Act enhanced the SEC’s enforcement mechanisms, and added a number of requirements on NRSROs that are immediately effective (i.e., do not depend on SEC rulemaking). The Dodd-Frank Act also required the commission to adopt a number of new rules concerning conflict of interests.

According to the US government and their news sheet, ‘the Dodd-Frank Act requires every federal agency to review existing regulations that require the use of an assessment of the credit-worthiness of the security or money market instrument and any references to credit ratings in such regulations; to modify such regulations identified in the review to remove any reference to, or requirement of reliance on credit ratings; and substitute with a standard of credit worthiness as the agency shall determine as appropriate for such regulations.’

What this meant was that from June 2010, the SEC  unanimously approved a plan to erase references to credit ratings from certain rulebooks. The agency also adopted a substitute to the ratings, the first of several such changes the commission had to enact. Dodd-Frank created a laundry list of new regulations for the industry, including proposals to make it easier for investors to sue the agencies. The SEC must also create its own Office of Credit Ratings to police the raters, though the agency has yet to open its doors as it struggles to scrape together the needed money.

Since the passing of the Dodd-Frank Act, Wall Street has been pushing back, spending millions of dollars to reverse Dodd-Frank and to ensure that the law is whittled away until it is meaningless. However, while the bankers were seeking to protect themselves, the fact that they were holding on to garbage since the financial crisis was becoming clearer. This is because the depth of the financial crisis was so much that the bail-out could barely touch the surface of the problem. In the past year, the vulnerability of the banks has been heightened by the capitalist crisis in Europe. As a means of pressuring the states of Greece, Portugal, Ireland, Iceland and others to implement austerity measures against workers, these rating agencies downgraded these countries’ ratings. These downgrades exacerbated the class struggles in Europe where the bankers and the bond-holders wanted to be paid. For the US capitalists, the crisis in Europe threatened the future of the Euro and the collapse of the Euro in the short term would serve the interests of the capitalists on Wall Street. This would ensure that there was no clear challenge to the dollar and the US could continue the military occupation of many countries in Europe, especially Germany.

However, some of these US capitalists were also exposed by the crisis in Europe and US banks wanted to ensure that the European Central Bank imposed austerity measures so that the full exposure of US banks would not be known. However, this crisis is not a simple one; it is structural and systemic and needs fundamental changes in how society is organised. This crisis has intensified in the past three months with the knowledge that states and societies such as Italy and Spain will also need the iron hand of international capital to impose harder burdens on the workers to transfer wealth from the majority to a minority. French banks are loaded up with the debts of Italy and Greece, and American banks are holding positions in these same French banks. Hence, US banks are not immune to the crisis in the Euro zone.

Psychological Barrier

There are some who have stated that the downgrade is cosmetic because the other two rating agencies, Moody’s and Fitch, have retained the AAA rating of the USA. This may seem to be the case but those who have been following the troubles of the banks and the fake stress tests know better. The timing of the announcement of the downgrade has some significance in the sense that it followed the false debate and conclusion of the debt deal.

By coming out after hours on Friday night when they knew the state of the markets, the downgrade also provided a false ‘public’ cover for the well-publicised subsequent fall and rise in global stock markets. Political spinners were able to point to the downgrade as the ‘spark’ for the drop in stock prices (particularly for the banks). In reality, the true causes are the growing risk and troubles in Europe, the continued lack of growth in the US, and the fact that in spite of all the trillions in bailouts of the banks, accounting rule changes, and the fake stress test exams to show that the banks are doing well, the market participants who understand the true status of the banks revealed that the banks are still in danger of collapsing.

Millions of persons around the world are paying attention and there are already signs that these foreign forces are losing confidence in the safety of US securities by the rise in the price of gold. The other point is that the political alliance that paved the way for this conjuncture is being strengthened by the power brokers in the Treasury/Wall Street/IMF relationship. It is this alliance that will work for the transfer of wealth to the top one per cent and will not countenance increased revenues from this small class.

As we have argued before, ultimately the question is not simply one of revenues and taxing the rich, but a fundamental restructuring of the system. However, in the short run, the call for more taxation and regulation of off shore accounts serve to expose the ways in which the capitalist class is above the law. Yet these capitalists have to live somewhere and they do not want to live in the offshore sites of money laundering and lawlessness. Hence, they need laws to suppress workers, take away collective bargaining, and the safety nets of social democracy.

The downgrade will raise the cost of borrowing; this in turn could trickle down to higher interest rates for local governments and individuals. The iterations of decline and deficits will increase the government debt and the deficit, and S&P has issued the clear threat that another downgrade will be coming after 18 months, if Congress does not follow its advice to impose austerity measures.

The Chickens Coming Home to Roost

US government officials are calling the methodology of the rating agencies flawed and some are calling for nationalisation of the agencies and/or the establishment of an international rating agency under the United Nations. There was no such call when the same agencies were working with the IMF to impose hardships on the rest of the world. Now, we are told that the rating agencies cannot do math. But the destructive structural adjustment math that the IMF-rating agencies alliance have used to destroy economies and livelihoods in the global South over the past 30 years were never questioned by those now calling out the S&P for its US$2 trillion error in its computation used to justify the US downgrade. The complaint was that a treasury official had spotted a US$2 trillion mistake in the agency's analysis. Whether it was a mistake or not, a psychological barrier has been breached. The US is no longer beyond the sanction of agencies that it unleashed against other societies.

Since the fall of Lehman Brothers in September 2008, politicians have sought to cushion the blows to capital by making band-aid remedies. For some, the issue was one of regulation and more control over the financial institutions. There were hearings in the US Congress and the Dodd-Frank law came into being. Through the media, the financiers went on the offensive about a recovery, but there has been no recovery because there was no fundamental alteration in the way capitalist ensured that wealth was transferred from the poor to the rich.

More, importantly the limits of US military power has been put on full display in Iraq and Afghanistan. The center of the world economy shifted to Asia while the USA and Europe were fighting in the Middle East. The ten biggest economies in Asia ring-fenced themselves against the USA and the instability of the dollar. This downgrade will reinforce this need for protection against the dollar. From China there was the warning that:

International supervision over the issue of US dollars should be introduced and a new, stable and secured global reserve currency may also be an option to avert a catastrophe caused by any single country.

This call for international supervision did not include any statement on the conditions of working peoples who are suffering at present. Inside the USA, the political choices have been sharpened. It is either the articulation of democratic control by the people or oligarchic control by the banks and financial houses. The downgrade was not a challenge to the government but to the working peoples of the USA and the world.

Youths in the streets of Greece, London, and Cairo are giving one response. The challenge is to coordinate these responses for a prolonged and sustained struggle to break the power of the financial-military-information complex. Those who have been following the gyrations of the capitalist debacle since 2007 will note that the events associated with the 2011 downgrade are simply precursors to what will continue to happen as the last 20 years of debt-driven growth in advanced capitalist nations unwinds. In the midst of this protracted crisis the rich will seek to transfer wealth from the poor as the only means of sustaining their accumulation of wealth as year 4 unfolds of what is likely to be a 7-10 year recession/depression.

The financial-military-information complex will continue to ensure that austerity to manage government debt falls on the backs of working people. Corporations will continue to claim that the only way they will invest some of their trillions in cash to create jobs and lower unemployment is to reduce regulations, lower corporate tax rates and perhaps even lower minimum wages. The American people must realise that the chickens have just come home to roost. The people must organise more and more to link up with working people’s struggles around the world to break up the banks, IMF-rating agencies alliance and their military enterprise. Financial institutions should be made to serve the people, not vice-versa.

Horace Campbell is professor of African-American studies and political science at Syracuse University. He is the author of Barack Obama and 21st Century Politics: A Revolutionary Moment in the USA. See www.horacecampbell.net.

Source: Pambazuka  Issue 544

posted 13 August 2011

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America Needs To Accept The Painful Fact That The Good Old Days Are Over—China's official comment on the S&P downgrade was harsh and condescending. Released through Xinhua (via Reuters) the statement condemned America for its "debt addiction" and "short-sighted" political wrangling. "The U.S. government has to come to terms with the painful fact that the good old days when it could just borrow its way out of messes of its own making are finally gone," Xinhua wrote.—BusinessInsider

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Stopping the UK’s Looters—by Alex Free—8 August 2011—What of the politicians content to help themselves to the public purse, bailed-out bankers with enormous, seemingly unrestrained bonuses and corporate tax evaders (who are also frequently complicit in entrenched resource- and land-grabbing within Africa and the global South)? Why employ a different vocabulary to describe these figures to that used for out-of-control youths raiding a local shop? Where one group of looters is seen to be a deplorable, mindless, violent underclass (apparently only paid attention to when rioting rather than peacefully protesting),[1] others prove able to behave with virtual impunity on an infinitely greater scale, albeit without the tangible mess (with the violence involved administered more subtly). This is not to deny or underplay the major significance of what the UK’s cities are currently experiencing, but rather to ask why we see such a sharp distinction between the response to these scenes and what we might term as ‘legalised looting’.

What could these examples of ‘legalised looting’ be? If we try to re-appropriate the definition of looting, we could for example point to multinational tax avoidance (by companies such as Vodafone and Barclays), governments’ willingness to deregulate and subsequently bail out the global banking system (yielding enormous profits for those originally responsible and precipitating widespread austerity measures and public-spending cuts) and British MPs’ enthusiasm for claiming wildly excessive expenses. Harnessing the opportunities presented by the rise of tax havens and the offshore economy, Vodafone for example escaped paying an estimated UK£6 billion in tax, while Barclays is allegedly able to dodge around UK£1 billion a year.

Tax evasion is a practice that occurs on a far grander scale within African countries as part of the broader problem of licit and illicit capital flight through tax dodging, under-reported profits and corruption—in essence, an element of the global South’s subsidising of the North. For example, Léonce Ndikumana and James Boyce have estimated the capital flight from 40 sub-Saharan African countries over the period 1970–2004 to be some US$420 billion (in 2004 dollars).[2] As a broader backdrop to the story of looting writ large, we could also underline the hegemony of neoliberal policy worldwide over the past 30 years or so, a policy that has underpinned increasingly more acute social and economic disparities and further facilitated the concentration of wealth and power within an ever smaller number of hands.

Further historical and contemporary examples of under-acknowledged looting are provided by the practice of resource-grabbing and the story of much of the Western world’s activities in Africa and the global South at large (whether it be oil, arable land or even people)—activities that go back at least as far as the advent of the transatlantic slave trade. If those rioting in the UK are to be condemned, the same standards should be applied to those happy to ‘outsource’ their violence and environmental degradation— from Shell’s murderous collusion with Nigeria’s authorities in the Niger Delta and the controversy around labour conditions within the Firestone company in Liberia to the activities of the US AFRICOM (Africa Command) programme and the intervention in Libya.

Indeed, if we look at the UK’s current contribution to NATO’s (North Atlantic Treaty Organisation) invasion of a sovereign African country (whose leader has fallen out of their favour), how is it that there is money for self-interested war-mongering and an illegal occupation aimed at resource extrapolation[2] yet none to develop the kind of community-regeneration initiatives that would have gone a long way towards preventing the events seen in the UK’s cities over the past week? Is this violence an unfortunate spin-off of dominant free market economic policy? Why is there not far greater emphasis on NATO’s killing of innocent civilians in Libya (and elsewhere in Iraq and Afghanistan)? And might Gaddafi look to recognise the UK’s own brand of rebels as the country’s new legitimate and official government?

Which looting is greater, more systematised, more problematic, senseless, violent and destructive? Could we say that one looting is ultimately a symptom of another? And what are we to make of the hypocrisy behind David Cameron’s own past form as a thug and gang member who would smash up private property with the infamous Oxford Bullingdon Club?

Stopping Looters

As a means of addressing socio-economic deprivation (and even cultural marginalisation), a holistic anti-looting policy would entail going after the practice in its most ‘high-brow’ form. Taking inspiration from certain existing ideas—albeit suggested in relation to street looters—and in a bid to move away from big business greed and towards social need, maybe we could turn things on their head and employ some of the proposed measures to contain those doing the most damage:

—a curfew: countries’ leaders, multinational CEOs, bankers, corporate tax lawyers and dubious MPs alike would be restricted in their movements

—phone data and personal details taken: with ordinary citizens fearing being monitored prior to actually committing a crime, figures of power should be the first to be under surveillance to ensure they do nothing underhand or larcenous

—the army: increased defence spending and militarisation are part of the problem, so in fact it’s probably best to leave the army out of it

—water cannon: to be used when all else fails.

Less flippantly, when it comes to those looting on the streets of the UK, the country needs to focus on the actual social conditions behind why we are seeing rioting. Likewise, we need to dare to imagine alternatives and work towards clamping down on more high-brow forms of looting and the system which fosters it. In a context in which the riots are themselves a product of increased unemployment, dispossession, imprisonment and police harassment, calls for more of the same policy and reaction will simply produce more of the same conditions.—Pambazuka

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For black Britons this is not the 80s revisited. It's worse—In 1985 there was not a single black MP. The main community voice came from Bernie Grant, then leader of Haringey council. Grant became a media hate figure in the aftermath of the Tottenham riot in which an officer had been killed, when he quoted youngsters gloating that the police had had "a bloody good hiding". However, his connection with local people made him hugely popular and two years later he was elected MP. Similarly, Paul Boateng, who had been a campaigning civil rights lawyer, greeted his own election the same night by declaring: "Today Brent South, tomorrow Soweto."

Today we have a dozen black MPs, including some in the Conservative party, but their backgrounds are a million miles from the community activism of their predecessors. Today's crop, well groomed in spin, ensure they remain on message. "I'm not a black MP, just an MP who happens to be black," is their common refrain. Aside from Diane Abbott (also of the class of 87), can anyone imagine them speaking with the passion of a Grant or Boateng? In the late 80s there were black leaders in three London boroughs. Now there are none. So who, today, speaks for black people?

 photo left: Diane Abbott

In 1993 the Commission for Racial Equality, Britain's most powerful anti-discrimination body, gained its first black chairman and was seen as a strong advocate for equal rights. In 2007, under New Labour, it was abolished, and subsumed within the Equality and Human Rights Commission, with much-depleted funds.

In 1982, the first black British newspaper, the Voice, was set up, as the mainstream media showed little interest in the black perspective. Initially it thrived, buoyed by the revenue from public sector equal-opportunities job adverts. Other black newspapers followedincluding my own. But one by one they went out of business. The Voice still survives, but as a shadow of its former self, the equality ads having dried up long ago.

In 1999, the Macpherson inquiry into the murder of Stephen Lawrence recognised institutional racism within the police. This led to a sudden interest in diversity and equality in mainstream institutions. On 9/11, though, attention suddenly switched to the Muslim "problem", and black equality was forgotten.

So the problems have festered on, only gaining attention during mini epidemics of gun or knife crime. This week, copycat looting has again shifted attention from the core problems within black communities: poverty, discrimination, disaffection, police harassment, educational underachievement, family breakdown. Some of these are for individuals and communities to address; some require support and a change of mindset by the state.

Over the last three decades we've allowed ourselves to be fooled that, with greater integration, plus a few black faces in sport and entertainment, things have improved. People gush about the growing mixed-race population, supposedly Britain's "beautiful" future. Well, Mark Duggan had a white parent but it didn't make much difference to his prospects.

Today, [David] Cameron could stick to his comfort zone, talking of tough action against gangs and social media, of punishing offenders and welfare spongers. This is destined to fail: as in Iran or Syria, a crackdown won't solve the problem. It will just bring more people into conflict with the law, seeing officers as the enemy. Once that happens, the impact on communities can be devastating.

So no, this is not 1981. In many ways it's worse. Those riots were in their own way aspirational—people thought things could get better. This time all the indicators seem to be pointing downwards.Guardian

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UK Systemically Racist , Policing & Lack of Opportunity  /  London riots: BBC apologises for accusing Darcus Howe

Eye Witness Account—Tottenham Riots  /  London Riots  / Linton Kwesi Johnson—Inglan Is A Bitch

London Insurrection—Now Why Does This sound So Damn Familiar?  / England riots: 'The whites have become black' says David Starkey

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"Her Majesty's Democracy": Britain's Parliament demands Violent Repression of Youth Riots—by Julie Hyland—12 August 2011—In his opening statement, Prime Minister David Cameron rejected that the disturbances were in any way connected to the police killing of 29-year old Mark Duggan last Thursday in Tottenham. Duggan’s death was “used as an excuse by opportunist thugs in gangs”, he claimed, to carry out “criminality”.

It is now known that Duggan was shot and killed in a pre-planned operation, and that police claims they had opened fire in self-defence are lies. His death was only the latest in the toll of some 340 fatalities that have occurred in police custody over the last decade or so, for which not a single police officer has been convicted.

Cameron is indifferent to police lawlessness, however. The purpose of his statement was to insist that the disturbances were solely the result of “criminality” and “immorality” amongst young people, who must be dealt with ruthlessly. The riots had shown that “pockets of society” were “frankly sick”, the prime minister said, marked by “mindless selfishness”, and a “complete lack of responsibility.” Not only is this a slander against working class youth. Such statements more properly apply to the prime minister himself.

After all, it is less than one month since this smug, multi-millionaire old Etonian was implicated in the lawless activities of Rupert Murdoch’s News of the World, which included phone hacking and the bribery and corruption of police officers. For years, the political establishment had kept quiet about News International’s “criminality on an industrial scale”—all eager to please the multi-billionaire, arch reactionary media baron lest he reveal the dirt he had on them. Even now Murdoch, his CEOs and the corrupt police officers involved have escaped prosecution. . . .

A range of punitive social “sanctions” are to be enforced against anyone involved in the disturbances—including evicting them from council housing, and stripping them of welfare benefits. Curfews, the interception of electronic communications and “anti-gang” measures are also on the table. . . .

The Labour Party is a corrupt, right-wing, big-business party. The various so-called “lefts” and “liberals”—indifferent to social deprivation and horrified at the spectre of social unrest lest it impinge on their privileged lifestyles and bulging stock portfolios—are no different. The Labour MP Diane Abbott was just one of those who gave her full support to the police clampdown. Abbot made her political career on the backs of the inner-city riots in the 1980s, exploiting the legitimate concerns of black workers and youth at police brutality. It was the failure of the police to intervene early enough in the current disturbances that gave the green light to “every little hooligan in London” to go out and loot, she said.

The rottenness and corruption of Labour, the “left” and the trade unions is entirely responsible for the fact that the legitimate grievances of young people have taken the form of an explosion of rage and violence. These organisations have either become open advocates of big business, in the case of Labour, or experts at directing workers’ struggles into the dead end of an orientation to the Labour Party. Walled off from any role in political life, working class youth have been unable to fight their deepening social oppression, until their anger exploded in response to recent acts of police brutality. The riots are in the final analysis the reflection of the government’s corruption and utter imperviousness to the basic needs of the working class.—GlobalResearch

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Revolutions are not decided by elections—Lessons from the ongoing electoral processes in EgyptHorace Campbell—31 May 2012—The Egyptian election results have shown that the state of the forces of repression must be dismantled before elections can have meaning. Experiences from Zimbabwe, Kenya and Uganda have pointed to the reality that progressives cannot hope to make real changes within an electoral system that reinforces neoliberal economics and low intensity democracy. The people in Egypt had revolted against unemployment, hunger, homelessness, police brutality, poverty and the alliance of the military with the United States and Israel. The Western media is blaming low turnout in the first round by saying that about 46 percent of Egypt’s approximately 50 million eligible voters turned out for the election. This is not the entire story. The real story is that the question of the restructuring of the Egyptian economy and the dismantling of the repressive military structures were not before the people. Religious leaders cannot depend on religion to solve the social questions of the peoples. Neither of the two candidates, Mohamed Morsi or Ahmed Shafiq, can claim to represents the interests of those who had gathered in Tahrir Square calling for a new regime.

The Western media reported the comment of one campaigner, Atef Ezz El-Din: “This just means that the revolution continues. Either we make it happen or we all die." Atef Ezz El-Din was reflecting a long held maxim; revolutions are not decided by elections. Pambazuka

 Chickens Come Home: US Credit Downgrade

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There is a need for Jobs, Jobs and more Jobs!

We need  JOB Training, JOB Creation and JOB Placement programsa Stimulus II. I advise President Obama to collect the one Trillion Dollars and any interest back as soon as possible from those recipients who owe before 1 mega bonus is given out. . . . I advise President Obama to implement Stimulus II and claim his spot in history stimulating the recovery of the US Economy and relieve the heavy economic pressure on the Obama supporters in many cases who are the most in need of a hand up in this time of suffering by the lower levels of American Society. Nation building like charity begins locally—at home. Stimulus II could help turn things around and be the difference in second term prospects and winning in 2010 by mobilizing the base! Momentum for Stimulus II could also receive a boost and be the next priority or second step to winning the health care overhaul legislation with a robust public option! If not $400 Billion or $1 trillion President Obama then propose some significant figure and go to work on it! Larry Johnson-Redd  ljredd52@aol.com

With 16 Million Jobless, Should the Feds Pay People to Work?

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Freefall: Free Markets and the Sinking of the Global Economy

By Joseph E. Stiglitz

The Great Recession, as it has come to be called, has impacted more people worldwide than any crisis since the Great Depression. Flawed government policy and unscrupulous personal and corporate behavior in the United States created the current financial meltdown, which was exported across the globe with devastating consequences. The crisis has sparked an essential debate about America’s economic missteps, the soundness of this country’s economy, and even the appropriate shape of a capitalist system. Few are more qualified to comment during this turbulent time than Joseph E. Stiglitz.

Winner of the 2001 Nobel Prize in Economics, Stiglitz is “an insanely great economist, in ways you can’t really appreciate unless you’re deep into the field” (Paul Krugman, New York Times).   The Ideological Crisis of Western Capitalism

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AALBC.com's 25 Best Selling Books


 

Fiction

#1 - Justify My Thug by Wahida Clark
#2 - Flyy Girl by Omar Tyree
#3 - Head Bangers: An APF Sexcapade by Zane
#4 - Life Is Short But Wide by J. California Cooper
#5 - Stackin' Paper 2 Genesis' Payback by Joy King
#6 - Thug Lovin' (Thug 4) by Wahida Clark
#7 - When I Get Where I'm Going by Cheryl Robinson
#8 - Casting the First Stone by Kimberla Lawson Roby
#9 - The Sex Chronicles: Shattering the Myth by Zane

#10 - Covenant: A Thriller  by Brandon Massey

#11 - Diary Of A Street Diva  by Ashley and JaQuavis

#12 - Don't Ever Tell  by Brandon Massey

#13 - For colored girls who have considered suicide  by Ntozake Shange

#14 - For the Love of Money : A Novel by Omar Tyree

#15 - Homemade Loves  by J. California Cooper

#16 - The Future Has a Past: Stories by J. California Cooper

#17 - Player Haters by Carl Weber

#18 - Purple Panties: An Eroticanoir.com Anthology by Sidney Molare

#19 - Stackin' Paper by Joy King

#20 - Children of the Street: An Inspector Darko Dawson Mystery by Kwei Quartey

#21 - The Upper Room by Mary Monroe

#22 – Thug Matrimony  by Wahida Clark

#23 - Thugs And The Women Who Love Them by Wahida Clark

#24 - Married Men by Carl Weber

#25 - I Dreamt I Was in Heaven - The Rampage of the Rufus Buck Gang by Leonce Gaiter

Non-fiction

#1 - Malcolm X: A Life of Reinvention by Manning Marable
#2 - Confessions of a Video Vixen by Karrine Steffans
#3 - Dear G-Spot: Straight Talk About Sex and Love by Zane
#4 - Letters to a Young Brother: MANifest Your Destiny by Hill Harper
#5 - Peace from Broken Pieces: How to Get Through What You're Going Through by Iyanla Vanzant
#6 - Selected Writings and Speeches of Marcus Garvey by Marcus Garvey
#7 - The Ebony Cookbook: A Date with a Dish by Freda DeKnight
#8 - The Isis Papers: The Keys to the Colors by Frances Cress Welsing
#9 - The Mis-Education of the Negro by Carter Godwin Woodson

#10 - John Henrik Clarke and the Power of Africana History  by Ahati N. N. Toure

#11 - Fail Up: 20 Lessons on Building Success from Failure by Tavis Smiley

#12 -The New Jim Crow: Mass Incarceration in the Age of Colorblindness by Michelle Alexander

#13 - The Black Male Handbook: A Blueprint for Life by Kevin Powell

#14 - The Other Wes Moore: One Name, Two Fates by Wes Moore

#15 - Why Men Fear Marriage: The Surprising Truth Behind Why So Many Men Can't Commit  by RM Johnson

#16 - Black Titan: A.G. Gaston and the Making of a Black American Millionaire by Carol Jenkins

#17 - Brainwashed: Challenging the Myth of Black Inferiority by Tom Burrell

#18 - A New Earth: Awakening to Your Life's Purpose by Eckhart Tolle

#19 - John Oliver Killens: A Life of Black Literary Activism by Keith Gilyard

#20 - Alain L. Locke: The Biography of a Philosopher by Leonard Harris

#21 - Age Ain't Nothing but a Number: Black Women Explore Midlife by Carleen Brice

#22 - 2012 Guide to Literary Agents by Chuck Sambuchino
#23 - Chicken Soup for the Prisoner's Soul by Tom Lagana
#24 - 101 Things Every Boy/Young Man of Color Should Know by LaMarr Darnell Shields

#25 - Beyond the Black Lady: Sexuality and the New African American Middle Class  by Lisa B. Thompson

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Barack Obama and 21st Century Politics

A Revolutionary Moment in the USA

By Horace Campbell

Campbell's book is a bracing reminder of all the threads of history woven into this extraordinary moment, a warning about the military and financial forces trying to keep things as they are, and an inspiration to work for the very different world that could be within our grasp.—Adam Hochschild, writer and journalist, co-founder of Mother Jones magazine and author of King Leopold's Ghost (2006)

"Horace Campbell probes the campaign of Barack Obama and finds a revolutionary potential vested in the use of new strategies and in its agenda for progressive social, economic and political change that would be historic if successfully affected in governance and accepted by a society truly ready for change.—Ronald W. Walters,

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The Persistence of the Color Line

Racial Politics and the Obama Presidency

By Randall Kennedy

Mr. Kennedy, a Harvard Law School professor, sets what we know of Mr. Obama’s presidency thus far in relief against the sorry history of racial politics in the United States. He worries, even in 2011, about “an inflated sense of accomplishment” in regard to racial progress. He points out that, in all of its history, America has elected only three black senators and two black governors. Mr. Kennedy examines recent racial flare-ups— over criticisms of America by the Rev. Jeremiah A. Wright Jr., Mr. Obama’s former pastor; over Sonia Sotomayor’s Supreme Court confirmation; over Mr. Obama’s remarks when the Harvard professor Henry Louis Gates Jr. was arrested by a white police officer after forcing open his own front door—and declares, using what is, I think, his book’s sole exclamation point: “Race still matters!” His book is also, crucially, a running and sometimes acid commentary on Mr. Obama and what Mr. Kennedy refers to as “the Obama enigma.” How progressive, deep down, is this man? Does he have the audacity, to borrow one of Mr. Obama’s favorite words, to lead?—NYTimes

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The Conscience of a Liberal : Reclaiming America from the Right

By Paul Krugman

Economist and New York Times columnist Krugman's stimulating manifesto aims to galvanize today's progressives the way Barry Goldwater's The Conscience of a Conservative did right-wingers in 1964. Krugman's great theme is economic equality and the liberal politics that support it. America's post-war middle-class society was not the automatic product of a free-market economy, he writes, but was created . . . by the policies of the Roosevelt Administration. By strengthening labor unions and taxing the rich to fund redistributive programs like Social Security and Medicare, the New Deal consensus narrowed the income gap, lifted the working class out of poverty and made the economy boom. Things went awry, Krugman contends, with the Republican Party's takeover by movement conservatism, practicing a politics of deception [and] distraction to advance the interests of the wealthy. Conservative initiatives to cut taxes for the rich, dismantle social programs and demolish unions, he argues, have led to sharply rising inequality, with the incomes of the wealthiest soaring while those of most workers stagnate.

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Race, Incarceration, and American Values

By Glenn C. Loury

In this pithy discussion, renowned scholars debate the American penal system through the lens—and as a legacy—of an ugly and violent racial past. Economist Loury argues that incarceration rises even as crime rates fall because we have become increasingly punitive. According to Loury, the disproportionately black and brown prison populations are the victims of civil rights opponents who successfully moved the country's race dialogue to a seemingly race-neutral concern over crime. Loury's claims are well-supported with genuinely shocking statistics, and his argument is compelling that even if the racial argument about causes is inconclusive, the racial consequences are clear.

Three shorter essays respond: Stanford law professor Karlan examines prisoners as an inert ballast in redistricting and voting practices; French sociologist Wacquant argues that the focus on race has ignored the fact that inmates are first and foremost poor people; and Harvard philosophy professor

Shelby urges citizens to break with Washington's political outlook on race. The group's respectful sparring results in an insightful look at the conflicting theories of race and incarceration, and the slim volume keeps up the pace of the argument without being overwhelming.—Publishers Weekly

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The White Masters of the World

From The World and Africa, 1965

By W. E. B. Du Bois

W. E. B. Du Bois’ Arraignment and Indictment of White Civilization (Fletcher)

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Ancient African Nations

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The Death of Emmett Till by Bob Dylan  The Lonesome Death of Hattie Carroll  Only a Pawn in Their Game

Rev. Jesse Lee Peterson Thanks America for Slavery / George Jackson  / Hurricane Carter

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The Haitian Declaration of Independence 1804  / January 1, 1804 -- The Founding of Haiti 

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