The Big Lie

Here is a must-see video: 137 pages of foreclosure notices in the Detroit Free Press BEFORE the bailout and resulting layoffs from the big three auto makers:

In 1989, while I was serving as Assistant Secretary of Housing, my staff noted that there was one town in which 70% of all the mortgages in the town were in default and owned by FHA, Freddie Mac and Fannie Mae.

I suggested that the town or county create a trust or corporate structure and swap stock in the entity for the mortgages. Such an idea was not possible then. It is now. Today, many of the defaulted mortgages are owned by private financial institutions. However, they are dependent on federal bailouts. So, it would be federal financing that would be financing the debt-equity swaps.

The Solari ReportIn later proposals, I suggested that the federal government provide waivers to allow for significant reengineering of federal spending, contracts and regulations within the area where doing so would improve return on investment to taxpayers. Indeed, take those two steps along with grassroots efforts for community gardens, local food coops, community currencies, and various transition town and financial permaculture options and you could really start to create vitality on the ground. And that is before integrating suppressed energy and health care technology which could be incredible.

Somehow, we have to see through the big lies. First is that the economy is in trouble. The economy is not in trouble. Our spirit and the culture is in trouble. We can’t build a strong economy by marketing drugs and the war on drugs into our communities. We can’t build a strong economy by making it impossible for teachers to teach. We can’t build a strong economy by permitting trillions of financial fraud and theft from the government. We can’t build a strong economy by taxing people so we can subsidize large corporations who make products that people don’t want and don’t need. If we make money by doing things that help people to fail, then our economy will fail. This is, however, a political problem. It is not first and foremost an economic problem.

Hence, giving lawless institutions more money to help the economy get moving will not work. It will simply rape more out of the real economy. It is monetary and financial racketeering. The message is “crime pays.” More bonuses for speculators, less money for engineers, scientists and teachers. The message is one designed to destroy the morale of honest, hardworking people throughout the economy.

Another big lie is that we need the banks to lend. We don’t need more debt. We need the stolen money returned. We need existing laws enforced. We need lawfulness. We need income. We need equity. We also need to be able to invest our equity where we want. Millions of Americans lose millions every day gambling on the lottery or going to casinos. At the same time, unless we are millionaires, it is nearly impossible to buy stock in our local businesses. Federal regulation says that it is “too risky” to invest in ourselves and our neighbors.

A really big lie is that we need consumption to keep the economy going. Indeed, if we start to circulate equity locally and through our networks, we can create a financial system in which we generate savings and financial capital gains from reducing consumption and building alignment between our financial ecosystems and our natural ecosystems. Indeed, the healthier the local environment or the better the local education and cultural life, the more it would cause stock values to rise.

I appreciate that this is not an attractive idea for the people who profit from selling $1 trillion plus of weapons and military services, but perhaps they would change if we collectively could find a way to tell them, “no.”

America’s economy is suffering from economic warfare and an organized crime tax designed to destroy it. The strength of the economy and of the American people despite this onslaught speaks volumes about the extraordinary wealth potential of America, our people and our democratic spirit.

Extraordinary wealth is possible. What is required is a change in spirit, in culture and in politics. To paraphrase Utah Phillips, “our economy is not dying, it is being killed. And the people killing it have names and addresses.”

Forget bailouts. Let’s stop doing those things that are destroying our real economy and let’s stop financing and supporting the people who are doing it.

9 Comments

  1. Dear Catherine: Well said…yet I am reminded that it may take a collective gestalt to move the masses..Much like your prior aweful experience with the federal government, “they” too ( the enforcement policies and it’s beaurocracy?? ) opposed my livelihood, and unlike your experience, I was federally incarcerated ( I’m not certain which could be judged worse ); and so, in my mind the government is not held in very high esteem…and in reality not for some time dating back to the 1960’s. I am reminded of Stephen and Ina May Gaskin’s ( Tennessee ) FARM and the caravan he organized to tour around the country. He proposed a simple message-Love One Another-Get back to the Land. These are perilous times; and the powers that be must be aware that they are treading on many people’s lives who have a boiling point…I am reminded of the frog in the slowly simmering boiling pot of water…With each week another bailout proposal is announced, and implimented; and yet the “folks”, as Bill O’Reilly likes to “them”, are not outwardly alarmed-nor are they rebellious–I suppose most Americans are easily manipulated..that’s my opinion.. they must be… otherwise how could they permit a $7.8 trillion outpouring into the financial system and not for a minute seem alarmed ( that’s 50% of our annual national GDP )–Have we been that muted as a society?? Were the founders so much more attuned so as to raise up and rebel??? And for a Tea Tax???–true they were not the majority by a long shot–But their cause was just and the British whose step child we were, were defeated ( with the aid of Hessians and the French )…It’s Black Friday-you know-shopping day–What I recall is that retailers from year to year depend on this weekend to fill their balance sheets with nearly 50% of their yearly business–WOW!! One weekend!!! Members of my family still maintain a family owned hardware/janitorial supplies business in NYC…they face severe times. Yet their love of oppulence will be their downfall—In general not many people are prepared for another Great Depression…not many live on the farm anymore, have mechanical skills nor the minimal talents it takes to gear down to a relatively hand to mouth economy…The psychology to persevere has been washed away from our collective memories and much pain is in front of those who are unable to prepare. This era will bring about an enormous retrenching in the common man a renewal of ethics and values of decencey or we will all perish..I look forward to your future kind words and solutions for those who have ears. warm regards, Richard Gordon CP

  2. My impression: There are already formed groups that could run with financial permaculture if they GET IT…gain the vision…it’s aligned with their missions. I recommend a 3-4 paragraph starter that we can incorporate into our communication in our communities to these types of groups.

    The section above about seeing through the big lies is key.

    Thanks for you vision, and action,

    Brad

  3. Dear Catherine,

    As shocking as that video is I’m sure you’re well aware of just what is coming down the pipe in a few years from now. The total collapse of the system we grew up in is not far off. buy buy buy ….. land to farm.

    sincerely

    david miller

  4. Neighbors have an interest in seeing that foreclosure is prevented. Besides lowering their own property values, foreclosure tends to cause deterioration of a neighborhood in other ways that reduce quality of life. Unfortunately, given the current extreme individualistic zeitgeist in many areas, it seems unlikely to me that neighbors will even think of organizing and taking a supporting interest, financial or in other ways. Having an informational leaflet(s) available on this site seems like a good idea.

  5. Just a note… The astounding 137 pages of foreclosure notices in the Detroit Free Press last week was strictly for properties in Wayne County, Michigan ( Detroit is the largest municipality in Wayne County ) that are ALREADY more than one year in default for taxes owed to the County.

    More recent residential Mortgage foreclosures were NOT listed. It is difficult to find a block in Detroit w/o battered plywood covering the doors & windows of at least one house… many houses on some streets.

  6. John:

    I noticed the title regarding tax lien foreclosures on the first page. I assumed that somewhere there were titled for something other than tax lien. Yikes! This is horrible.

    Thanks so much for pointing this out.

    Catherine

  7. I have to disagree with you, the economy is in trouble. We’ve got other troubles like you’ve mentioned but the economy is in trouble. Our economy is in trouble because of many various reasons. Most of those reasons aren’t mentioned by the media spin masters. They just want everyone to believe it was caused by taxpayers getting greedy and taking out too many loans. I believe they do that in an effort to make it look like we’re all guilty. They packed that guilt trip into a nice little word: subprime.

    Check into Derivatives and how people traded debt on the markets which is now either worthless or worth very very little compared to what it sold on the markets for. Now there’s no market for it because nobody wants to touch it.

    Greg Hunter writes: “Where is the Outrage?” “This all gets back to OTC DERIVATIVES… THE REAL UNDERLYING PROBLEM. I am talking about securitized debt. The financial wizards of the world securitized every debt imaginable…mortgages, credit cards, car loans, student loans. You name the debt and it was wrapped up into some sort of security. It is safe to say the size of the problem is somewhere between 500 and 1000 trillion dollars depending on who you talk to. Whatever the amount is the problem is BIG, VERY VERY BIG!!!! The biggest financial problem ever in the history of the world! THERE IS NO PUBLIC MARKET FOR OTC DERIVATIVES and nobody is talking about creating one as part of a solution!!! THERE IS NO WAY THAT THIS FINANCIAL CRISIS WILL EVER BE OVER UNTIL THERE IS A FINANCIAL MARKET FOR THIS CRAP. But of course, if there is a market that would provide a “price discovery” and then we would find out this stuff is worthless or near worthless. So the powers that be are just throwing good money after bad. I think the most outrageous part of the whole story is even though the taxpayer is on the hook for several trillion dollars we do not get to know which banks are getting the money and what “assets” the banks are unloading on the government. I suspect these “assets” are probably akin to candy wrappers and toilet paper. Fed Chairman Ben Bernanke has said the reason they will not disclose this information to the public is that it would not be “helpful”. THE SECRECY BEHIND ALL THIS GOVERNMENT ACTION IS OUTRAGEOUS!!!!! What in fact the powers that be are hoping for is that this money printing will “unclog” the credit markets and get things back to “normal.” These toxic “securities” or derivatives can then start trading again the way they used to without a public market. No public market means trading would again be done without regulation, guarantee or standards of any kind. I say no way! We do not have a credit problem but a collateral problem and the banks do not trust the collateral. There is going to be a new “normal” and most people are not going to like what that feels and looks like. I guess then there will be OUTRAGE!!! ” Source: http://www.jsmineset.com

  8. Thanks so much for saying this. We are being told lies. **It is monetary and financial racketeering. The message is “crime pays.”** If they were successful in reviving our current financial system, what would be achieved? At best the economy would wheeze its way to the next crisis/downturn. The part that needs fixed is the part being saved.

    The troubles are also spoken of in terms of “we” as if we had all been playing at structured finance. Some of “we” have been quietly working our whole lives, hard, and hoping we would be better served by our government than we have been.

    The apologists, the tv talking heads who either do no have a clue or are prevented by contracted from letting truth air, also speak of THE economy. There is not one economy; there are many. The lie behind that phrase is that WE all participated in THE economy, and not that some have become rich gaming our nation like one big Enron.

    Love your site and insights.

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