War By Other Means

John Pilger and David Munro examine the policy of First World banks agreeing loans with Third World countries, who are then unable to meet the crippling interest charges.

War By Other Means

John Pilger travels to many third world countries to investigate the devastating results of loans from the World Bank and International Monetary Fund (IMF). 

This film shows how many wars today are not carried out at the barrel of a gun, but by the monetary policies of global banking institutions. 

Instead of bombs, it has been discovered that debt is a far more powerful weapon to control and maintain the power of global economic interests. 

It turns out that the "structural-adjustment" policies of neo-liberal economics are even more deadly than nerve gas and many other weapons of war. 

This documentary backs up many of the claims made by John Perkins, author of Confessions of an Economic Hit Man.

Your Lifestyle Has Already Been Designed

The Real Reason For The Forty-Hour Workweek

Well I’m in the working world again. I’ve found myself a well-paying gig in the engineering industry, and life finally feels like it’s returning to normal after my nine months of traveling.

Because I had been living quite a different lifestyle while I was away, this sudden transition to 9-to-5 existence has exposed something about it that I overlooked before.

Since the moment I was offered the job, I’ve been markedly more careless with my money. Not stupid, just a little quick to pull out my wallet. As a small example, I’m buying expensive coffees again, even though they aren’t nearly as good as New Zealand’s exceptional flat whites, and I don’t get to savor the experience of drinking them on a sunny café patio. When I was away these purchases were less off-handed, and I enjoyed them more.

I’m not talking about big, extravagant purchases. I’m talking about small-scale, casual, promiscuous spending on stuff that doesn’t really add a whole lot to my life. And I won’t actually get paid for another two weeks.

In hindsight I think I’ve always done this when I’ve been well-employed — spending happily during the “flush times.” Having spent nine months living a no-income backpacking lifestyle, I can’t help but be a little more aware of this phenomenon as it happens.

I suppose I do it because I feel I’ve regained a certain stature, now that I am again an amply-paid professional, which seems to entitle me to a certain level of wastefulness. There is a curious feeling of power you get when you drop a couple of twenties without a trace of critical thinking. It feels good to exercise that power of the dollar when you know it will “grow back” pretty quickly anyway.

What I’m doing isn’t unusual at all. Everyone else seems to do this. In fact, I think I’ve only returned to the normal consumer mentality after having spent some time away from it.

One of the most surprising discoveries I made during my trip was that I spent much less per month traveling foreign counties (including countries more expensive than Canada) than I did as a regular working joe back home. I had much more free time, I was visiting some of the most beautiful places in the world, I was meeting new people left and right, I was calm and peaceful and otherwise having an unforgettable time, and somehow it cost me much less than my humble 9-5 lifestyle here in one of Canada’s least expensive cities.

It seems I got much more for my dollar when I was traveling. Why?

A Culture Of Unnecessaries

Here in the West, a lifestyle of unnecessary spending has been deliberately cultivated and nurtured in the public by big business. Companies in all kinds of industries have a huge stake in the public’s penchant to be careless with their money. They will seek to encourage the public’s habit of casual or non-essential spending whenever they can.

In the documentary The Corporation, a marketing psychologist discussed one of the methods she used to increase sales. Her staff carried out a study on what effect the nagging of children had on their parents’ likelihood of buying a toy for them. They found out that 20% to 40% of the purchases of their toys would not have occurred if the child didn’t nag its parents. One in four visits to theme parks would not have taken place. They used these studies to market their products directly to children, encouraging them to nag their parents to buy.

This marketing campaign alone represents many millions of dollars that were spent because of demand that was completely manufactured.

“You can manipulate consumers into wanting, and therefore buying, your products. It’s a game.” ~ Lucy Hughes, co-creator of “The Nag Factor”

This is only one small example of something that has been going on for a very long time. Big companies didn’t make their millions by earnestly promoting the virtues of their products, they made it by creating a culture of hundreds of millions of people that buy way more than they need and try to chase away dissatisfaction with money.

We buy stuff to cheer ourselves up, to keep up with the Joneses, to fulfill our childhood vision of what our adulthood would be like, to broadcast our status to the world, and for a lot of other psychological reasons that have very little to do with how useful the product really is. How much stuff is in your basement or garage that you haven’t used in the past year?

The Real Reason For The Forty-Hour Workweek

The ultimate tool for corporations to sustain a culture of this sort is to develop the 40-hour workweek as the normal lifestyle. Under these working conditions people have to build a life in the evenings and on weekends. This arrangement makes us naturally more inclined to spend heavily on entertainment and conveniences because our free time is so scarce.

I’ve only been back at work for a few days, but already I’m noticing that the more wholesome activities are quickly dropping out of my life: walking, exercising, reading, meditating, and extra writing.

The one conspicuous similarity between these activities is that they cost little or no money, but they take time.

Suddenly I have a lot more money and a lot less time, which means I have a lot more in common with the typical working North American than I did a few months ago. While I was abroad I wouldn’t have thought twice about spending the day wandering through a national park or reading my book on the beach for a few hours. Now that kind of stuff feels like it’s out of the question. Doing either one would take most of one of my precious weekend days!

The last thing I want to do when I get home from work is exercise. It’s also the last thing I want to do after dinner or before bed or as soon as I wake, and that’s really all the time I have on a weekday.

This seems like a problem with a simple answer: work less so I’d have more free time. I’ve already proven to myself that I can live a fulfilling lifestyle with less than I make right now. Unfortunately, this is close to impossible in my industry, and most others. You work 40-plus hours or you work zero. My clients and contractors are all firmly entrenched in the standard-workday culture, so it isn’t practical to ask them not to ask anything of me after 1pm, even if I could convince my employer not to.

The eight-hour workday developed during the industrial revolution in Britain in the 19th century, as a respite for factory workers who were being exploited with 14- or 16-hour workdays.

As technologies and methods advanced, workers in all industries became able to produce much more value in a shorter amount of time. You’d think this would lead to shorter workdays.

But the 8-hour workday is too profitable for big business, not because of the amount of work people get done in eight hours (the average office worker gets less than three hours of actual work done in 8 hours) but because it makes for such a purchase-happy public. Keeping free time scarce means people pay a lot more for convenience, gratification, and any other relief they can buy. It keeps them watching television, and its commercials. It keeps them unambitious outside of work.

We’ve been led into a culture that has been engineered to leave us tired, hungry for indulgence, willing to pay a lot for convenience and entertainment, and most importantly, vaguely dissatisfied with our lives so that we continue wanting things we don’t have. We buy so much because it always seems like something is still missing.

Western economies, particularly that of the United States, have been built in a very calculated manner on gratification, addiction, and unnecessary spending. We spend to cheer ourselves up, to reward ourselves, to celebrate, to fix problems, to elevate our status, and to alleviate boredom.

Can you imagine what would happen if all of America stopped buying so much unnecessary fluff that doesn’t add a lot of lasting value to our lives?

The economy would collapse and never recover.

All of America’s well-publicized problems, including obesity, depression, pollution and corruption are what it costs to create and sustain a trillion-dollar economy. For the economy to be “healthy”, America has to remain unhealthy. Healthy, happy people don’t feel like they need much they don’t already have, and that means they don’t buy a lot of junk, don’t need to be entertained as much, and they don’t end up watching a lot of commercials.

The culture of the eight-hour workday is big business’ most powerful tool for keeping people in this same dissatisfied state where the answer to every problem is to buy something.

You may have heard of Parkinson’s Law. It is often used in reference to time usage: the more time you’ve been given to do something, the more time it will take you to do it. It’s amazing how much you can get done in twenty minutes if twenty minutes is all you have. But if you have all afternoon, it would probably take way longer.

Most of us treat our money this way. The more we make, the more we spend. It’s not that we suddenly need to buy more just because we make more, only that we can, so we do. In fact, it’s quite difficult for us to avoid increasing our standard of living (or at least our rate of spending) every time we get a raise.

I don’t think it’s necessary to shun the whole ugly system and go live in the woods, pretending to be a deaf-mute, as Holden Caulfield often fantasized. But we could certainly do well to understand what big commerce really wants us to be. They’ve been working for decades to create millions of ideal consumers, and they have succeeded. Unless you’re a real anomaly, your lifestyle has already been designed.

The perfect customer is dissatisfied but hopeful, uninterested in serious personal development, highly habituated to the television, working full-time, earning a fair amount, indulging during their free time, and somehow just getting by.

Is this you?

Two weeks ago I would have said hell no, that’s not me, but if all my weeks were like this one has been, that might be wishful thinking.

By David Cain

The Truth Is Out: Money Is Just An IOU

The central bank can print as much money as it wishes.' Photograph: Alamy

The Bank of England's Dose Of Honesty Throws The Theoretical Basis For Austerity Out The Window

Back in the 1930s, Henry Ford is supposed to have remarked that it was a good thing that most Americans didn't know how banking really works, because if they did, "there'd be a revolution before tomorrow morning".

Last week, something remarkable happened. The Bank of England let the cat out of the bag. In a paper called "Money Creation in the Modern Economy", co-authored by three economists from the Bank's Monetary Analysis Directorate, they stated outright that most common assumptions of how banking works are simply wrong, and that the kind of populist, heterodox positions more ordinarily associated with groups such asOccupy Wall Street are correct. In doing so, they have effectively thrown the entire theoretical basis for austerity out of the window.

To get a sense of how radical the Bank's new position is, consider the conventional view, which continues to be the basis of all respectable debate on public policy. People put their money in banks. Banks then lend that money out at interest – either to consumers, or to entrepreneurs willing to invest it in some profitable enterprise. True, the fractional reserve system does allow banks to lend out considerably more than they hold in reserve, and true, if savings don't suffice, private banks can seek to borrow more from the central bank.

The central bank can print as much money as it wishes. But it is also careful not to print too much. In fact, we are often told this is why independent central banks exist in the first place. If governments could print money themselves, they would surely put out too much of it, and the resulting inflation would throw the economy into chaos. Institutions such as the Bank of England or US Federal Reserve were created to carefully regulate the money supply to prevent inflation. This is why they are forbidden to directly fund the government, say, by buying treasury bonds, but instead fund private economic activity that the government merely taxes.

It's this understanding that allows us to continue to talk about money as if it were a limited resource like bauxite or petroleum, to say "there's just not enough money" to fund social programmes, to speak of the immorality of government debt or of public spending "crowding out" the private sector. What the Bank of England admitted this week is that none of this is really true. To quote from its own initial summary: "Rather than banks receiving deposits when households save and then lending them out, bank lending creates deposits" … "In normal times, the central bank does not fix the amount of money in circulation, nor is central bank money 'multiplied up' into more loans and deposits."

In other words, everything we know is not just wrong – it's backwards. When banks make loans, they create money. This is because money is really just an IOU. The role of the central bank is to preside over a legal order that effectively grants banks the exclusive right to create IOUs of a certain kind, ones that the government will recognise as legal tender by its willingness to accept them in payment of taxes. There's really no limit on how much banks could create, provided they can find someone willing to borrow it. They will never get caught short, for the simple reason that borrowers do not, generally speaking, take the cash and put it under their mattresses; ultimately, any money a bank loans out will just end up back in some bank again. So for the banking system as a whole, every loan just becomes another deposit. What's more, insofar as banks do need to acquire funds from the central bank, they can borrow as much as they like; all the latter really does is set the rate of interest, the cost of money, not its quantity. Since the beginning of the recession, the US and British central banks have reduced that cost to almost nothing. In fact, with "quantitative easing" they've been effectively pumping as much money as they can into the banks, without producing any inflationary effects.

What this means is that the real limit on the amount of money in circulation is not how much the central bank is willing to lend, but how much government, firms, and ordinary citizens, are willing to borrow. Government spending is the main driver in all this (and the paper does admit, if you read it carefully, that the central bank does fund the government after all). So there's no question of public spending "crowding out" private investment. It's exactly the opposite.

Why did the Bank of England suddenly admit all this? Well, one reason is because it's obviously true. The Bank's job is to actually run the system, and of late, the system has not been running especially well. It's possible that it decided that maintaining the fantasy-land version of economics that has proved so convenient to the rich is simply a luxury it can no longer afford.

But politically, this is taking an enormous risk. Just consider what might happen if mortgage holders realised the money the bank lent them is not, really, the life savings of some thrifty pensioner, but something the bank just whisked into existence through its possession of a magic wand which we, the public, handed over to it.

Historically, the Bank of England has tended to be a bellwether, staking out seeming radical positions that ultimately become new orthodoxies. If that's what's happening here, we might soon be in a position to learn if Henry Ford was right.

(By David Graeber)

U.S. "Stock Market Is Rigged"

Courtesy of: CBS and 60 Minutes

Steve Kroft reports on a new book from Michael Lewis, "Flash Boys," that reveals how a group of unlikely characters discovered how some high speed traders work the stock market to their advantage.

 U.S. stock ownership is at a record low and less than half of Americans trust banks and financial services. And in the last two weeks, the New York attorney general and the Commodities Futures Trading Commission in Washington have both launched investigations into high-frequency computerized stock trading that now controls more than half the market.

How The Economic Machine Works

Ray Dalio manages the world's largest hedge fund, Bridgewater Associates.

It has a tremendous track record, so when the man talks about markets, people usually listen.

Beyond that, Dalio is known for having one of the most refined understandings of the economy in the financial industry.

Lots of investors pontificate, but Dalio's views are legitimately well-respected.

As part of his mission to explain how the economy works, Dalio has put together a neat, new 30-minute animated video called "How the Economic Machine Works," where Dalio narrates his big-picture view of the economy.

"I feel a deep sense of responsibility to share my simple but practical economic template," Dalio says. "Though it's unconventional, it's helped me to anticipate and sidestep the financial crisis, and it has worked well for me for over 30 years."

Dalio is worth almost $13 billion, so it's safe to say his economic template has served him well.

The Gold Is Gone - Germanys' Access To Its Gold Denied

Courtesy Of: Russia Today

The world is losing trust in the dollar as a safe haven. 

A major blow came after Germany's Bundesbank demanded the repatriation of a big chunk of its gold being held in the US. 

Because as RT's Gayane Chichakyan reports, some are concerned the assets of foreign nations in the Federal Reserve are not secure or even there. 

The Germans were infuriated when the US Federal reserve didn't even let them examine their own assets properly. 

Peter Boehringer, the founder and chairman of 'German Precious Metal Association', says that's a bad sign.

How Grossly Unfair The U.S. Tax System Has Become

By Mark Gongloff

Apple CEO Tim Cook waved a magic wand in front of America on Tuesday, vanishing our outrage over how shamelessly companies avoid paying taxes, leaving the rest of us to foot the bill. As a public service to you, here is a chart that should enrage you about corporate tax rates all over again! (Story continues below chart of RAGE.)

Notice the beige stripe that is shrinking steadily? That stripe is the percentage corporate taxes contribute to total federal revenue. And notice the olive-green stripe that has swollen to be larger than the beige stripe used to be? That is the contribution of payroll taxes to federal revenue.

What this shows is how dramatically corporate tax contributions have shrunk in the past several decades, and how our personal taxes have risen to fill the gap. Payroll taxes now make up 35 percent of all federal government tax receipts, up from 11 percent in 1950. Corporate income taxes, meanwhile, now make up less than 10 percent of federal revenue, down from about 26 percent in 1950.

To 'splain those numbers a little more clearly: We who are on the payrolls of companies now bear way more of a tax burden than those companies bore decades ago. Those companies, meanwhile, bear less of a burden than we ever did.

And this doesn't include individual income tax, which accounts for about 46 percent of total federal tax receipts, roughly the same as 60 years ago.

Update: This chart of course does not reflect the fact that employers typically cover half of the payroll taxes collected by the government. Assuming companies pay half of the payroll taxes in this chart, the total tax burden for individual Americans is reduced to about 63 percent of total federal revenue, instead of 81 percent, as I estimated in an earlier version of this story. But that is up from about 45 percent in 1950.

And the total corporate contribution to federal revenue, including employers' share of payroll taxes, has dwindled from 32 percent in 1950 to about 17 percent today. Employer contributions to payroll taxes make the unfairness of the tax code slightly less unfair, but the trend is still clear and dramatic: Corporations are paying a lot less than they used to.

This chart was produced for aSeptember 2012 report (download-y PDF file) about corporate tax avoidance by the Senate Permanent Subcommittee on Investigations. Walter Hickey of Business Insider helpfully republished the chart on Tuesday, in honor of Cook's testimony before the same subcommittee. Update: The Senate lifted the chart directly from an earlier Tax Policy Center report about the sources of government revenue.

Cook was there to techsplain how Apple holding $102 billion of cash offshore isn't really tax avoidance so much as good old fashioned ingenuity. Also, have you forgotten the shiny objects Apple makes (including the dreamy MacBook Air on which this here story was typed)? By the end of the hearing, Sen. Rand Paul (R-Ky.) had demanded that Congress apologize to Apple for the inconvenience, and Sen. John McCain (R-My Lawn) was reduced to gently jibing Cook about how often he has to update his apps.

And Rand Paul is kind of right, you guys, as is Tim Cook: We should not be so mad at Apple for doing what the law allows. We should be mad that the law allows Apple and other companies to keep billions of dollars of cash offshore and out of the government coffers, where it could be helping the unemployed and our crumbling infrastructure and such. Another thing we can get mad about is how the "corporate tax reform" that Cook and other corporate leaders are always banging on about will actually serve tomake it so companies pay even less in taxes than they do now.

How Money Drives The ‘Cycle Of Tyranny’

In Order For The “Cycle Of Tyranny” To Exist, There Are 4 Key Institutions That Must Be Totally Co-Opted

By Jason Charles

This process can be termed the “Cycle of Tyranny” and is basically the method large institutions such as government, corporations, and banks participate in as a on going feed back loop that is totally driven by money and power.

This cycle is designed to centralize power, rob people of their liberties, wealth and ultimately dignity due to the very dehumanizing and egregious actions of the men who sell themselves to this system. In fact, this whole system thrives on the dehumanizing process and erosion of individual rights enshrined in the Constitution.

To achieve this effect in a society large amounts of money are infused at every layer of the targeted and co-opted institution to assure that typically good moral people are bribed and in continual defense of the corrupted institution. With out the money factor the internationalist system simply would not work because the incentive component with in the cycle would be removed. The ablity for banks to create money out of thin air is the driving force behind the “Cycle of Tyranny”. 

The Banks

“I believe that banking institutions are more dangerous to our liberties than standing armies.  Already they have raised up a moneyed aristocracy that has set the government at defiance. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”  - Thomas Jefferson

The banking families of Europe have utilized a debt based system to centralize a vast empire of wealth and power over the course of hundreds of years. By lending governments and institutions money, it creates a state of perpetual dependence, the fear of losing the money source is how banks control and socially engineer these institutions to pliable agencies of the internationalists worldview. Money truly corrupts the hearts of man, as long as the money is flowing men will turn a blind eye to atrocities of all types. It is through the corrupting influence money has had on mankind we begin to see how money and it’s love is truly the engine in the “Cycle of Tyranny”.

Today’s America serves as a perfect model as to how the old banking families have been able to leverage their large financial capabilities into a free country in order to corrupt and take over all of the major institutions with in a society. America was founded on the Principles of Liberty which detested banking institutions to the point of war with England and the British monarchy.

The process begins with the establishment of a central bank, in America’s case the Federal Reserve in the year 1913. It is no coincidence that the American Industrial Revolution coincided with the founding of the Federal Reserve. What we termed the “Robber Barons” during the early 20th century like Rockefeller, Carnegie, Ford, J.P. Morgan were really no more than agents of the Federal Reserve and the European financial elite. These agents were lent massive sums of money through the banking apparatuses backed by the newly formed Federal Reserve. They then took over their respective sectors of society. For example, Rockefeller took the Pharmacological/Medical/Education and also Oil sector, while Carnegie took over the Steel and Railroads, J.P. Morgan served as a financial agent etc. etc.

All of these men became exceedingly wealthy because they were financed agents who built the mega corporations of today. It is these corporations that had an unfair advantage because they were specially trained, and groomed by the international elite for the sole purpose of building up all of America, with the long term plan of turning it back over to the globalists at a later date.

The bankers utilize the “Boom and Bust Cycle” of the economy to first “Boom”, or build up large corporations through influxes of capital that then creates large, businesses, property, inventions, and institutions. The bankers can then “Bust” the economy by drying up the lending credit suddenly to these reliant businesses and institutions. This sudden collapse in capital is called a “Depression” it is an orchestrated event planned by the central bank to purposely collapse companies into bankruptcy. Once bankrupt the bank can then buy up the company assets pennies on the dollar funneling these new assets to the share holders of the banks.

This “Boom and Bust” cycle is the verbatim tactic that our founding fathers warned us time and time again having seen this happen in European nations. They hated the bankers and fought tooth and nail to keep a central bank out of our country knowing their money is the moral ruin to everything America stood for.

One hundred years later we have forgot history and the bankers have utilized this system to create, crash then buy up resources and the wealth of nation in every country on the planet. This financial boom and bust is the mechanism of control they have used to enslave countries world wide in debt and are now bringing about their international global system called the New World Order. A banking order controlled by organizations such as the IMF, UN, and World Bank.

The Corporations

“I hope that we shall crush in its birth the aristocracy of our monied corporations, which dare already to challenge our government to a trial of strength, and bid defiance to the laws of our country.” -Thomas Jefferson
 

The companies that have been built up by the lending power of the central banks are controlled and sustained through bank capital and the drive of the share holders whose only motive is profit. This creates an amoral environment where everybody from the CEO down to the mail-room clerk are chasing dollar signs at every turn. Their only concern is how they can make more profit.

They do this by a variety of ways, they will cheapen the quality of their product, they will identify populations with low standards of living and human rights to exploit for little to no wages, they will also lobby government to create laws and regulations that favor them and harm their competition.

Through this process, of receiving unfair financial lending advantage, reducing ethics with in the institution, and creating fascist partnerships with government, corporations that place money first almost always inevitable become so corrupt that they begin to create even more and more devious ways to assure the take over and monopolization of their host countries competition. They soon grow so large they begin to covet the resources and wealth of neighboring nations, which put’s them in a new strata of power called the multinational corporation.

It is much harder to employee these tactics on an international scale because without the protection of the target countries government, the unethical and dirty dealings almost always lead to war.

The people will never go to war for a corporation. The vast majority of people wish to live in peace and harmony with their neighbors, but corporations have insatiable need for control, power and money and have to find more and more dubious ways to push their corporation into other countries to keep the feeding cycle going.

This is where companies can then hire think tanks to devise devious, far reaching plans that allow them eventual access to the resources of other countries as well as their own when they come up against obstacles towards their agenda.

Think Tanks

“If ye love wealth better than liberty, the tranquility of servitude better than the animating contest of freedom, go home from us in peace. We ask not your counsels or arms. Crouch down and lick the hands which feed you. May your chains set lightly upon you, and may posterity forget that ye were our countrymen.” – Samuel Adams
 

Think tanks are made up of individuals who have been long time agents of the system. They are usually made up of very smart people who have bounced back and forth between corporate and government structures gaining reputation, influence and command over the intricacies of corporate, banking and government institutions.

Whether it be military, intelligence, financial, social, political or international needs a corporation can hire a wide variety of think tanks to create plans that utilize the various sectors of societal institutions to further the agenda of their client. Both governments and corporations hire these companies for large sums of money for the sole purpose of creating facilitating plans to push their agenda forward.

Now that America is a fascist state, it is very, very difficult to determine where the corporate objectives end and the governmental objectives begin, often times they are one in the same. The think tanks are able to utilize assets of both institutions by pulling together military, intelligence and corporate teams to formulate plans to access resources and strategic objects that are beneficial for the corporation, the government and also the banks.

This partnership is very dangerous for the general public and society at large and is often wrought with corruption and shadowy dealings that must be hidden through the cloud of top secrecy and clandestine operations. Tactics of extortion, racketeering, money laundering, assassination and other criminal activity are almost always considered in the think tank atmosphere. There are expensive ways and moral ways to gain access to resources or their are covert ways often touted as much cheaper but are ethically bankrupt and criminal to gain the desired access.

The more covert means always need cooperation and cover by the government through national security and official channels. The think tank will then utilize their influence and lobby and produce policy that impacts political parties towards their “prescribed” resolutions.

Often times it is the government or corporation that comes to the think tank saying we want to invade here or secure our corporation here, the think tank provides both the plan to create a facilitating event which is carried out covertly through sabotage campaigns, or false flag attacks, or stage bombings and then when the crisis reaches a climax it will lend it’s credibility and solution towards dealing with the crisis they created. This is called “Problem, Reaction, Solution”. They simply create the problem, the reaction is the politicians and public demand action and then they turn around and offer the solution of sending in their corporations or military towards resolution. A resolution that just so happens to give them full access strategically, militarily, and politically to a targeted nation.

A successful mission will given them the desired result every-time, enriching multinational corporations, banks and governments alike as they split up the loot and resources of taking over countries and conquering. A program as old as time itself.

Government comes into play to provide PR and official cover for these programs. Obviously war and invading nations is nasty business and the government has to be on board, that is why you always see politicians defaulting to the think tanks who write the policies as specialists and advisers on such things.

Government

“Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master.” – George Washington

The government is an institution charged with securing the liberties and security of their population. That is the sole reason for them to exist and is always formed through a unified agreement of the people towards this end.

The Declaration of the United States is a beautiful word picture of why governments are formed, who forms and empowers them which is the people, and when it is appropriate to disband them in favor of a new government body. The only proper way and time to disband a government is when it becomes so corrupt that it encroaches on the liberties, wealth and prosperity of the people. At that point the people have every right to nullify and succeed from corrupt government. Seeing it was them who formed the state they too can end the state.

Self-defense is a natural right of man, government is instituted to aid this natural right, but sometimes governments become so out of touch with the original charter they begin to infringe on the rights of the people to point of distress and ruin with in society. When this happens it no longer serves the interest of the people and must be opposed and resisted by force if necessary, why, because again self-defense of life and  the liberties of the people is a universal law that trumps all institutional agendas including government.

The people, if they through apathy allow government to get out of control, have a natural right to defend themselves against their own government that seeks their ruin. Nothing is more destructive than wicked government. Government, once taken over by politicians, corporate agents and banking controllers, history shows will act in the most dehumanizing, repulsive and tyrannical way possible. Instead of fulfilling their oath to the Constitution, they side with agents of the fascist system as it is taken over lock stock and barrel by the banking elite.

Why the government is such a powerful vehicle towards tyranny and oppression is because it has the power to tax the people to pay it’s debt to the banks i.e. IRS, it also is in control of standing armies which can be easily directed through manufactured crisis events either in the homeland or abroad wreaking havoc on society, and it also provides political and official cover for corporate and globalist agendas, agendas that are a determent to the people.

Tyrannical government has murdered, enslaved, imprisoned and bankrupted countless millions over the eons of human history. To allow it to get out of control is to invite destruction and destitution on a society.

Solutions

“Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.” – John Adams

The solution to these things is morality. Our founders were quite clear that without an ethical, knowledgeable moral, and well informed population these institutions would most certainly gain control.

If you as a philosophical libertarian equate freedom and liberty with living excessive lifestyles you are totally off base. These things have nothing to do with liberty, the moral resolve of our founders who many of them lost it all in the revolution is about understanding. They understood that defending life is paramount to anything we can do on this planet. Those who refuse to defend life, seeing that it is scared and worthy of protection have no concept of what it means to walk in the principles our forefathers bequeathed us. It is they who have sold themselves to these systems and jeopardize everything our country is founded on.

We have identified the “Cycle of Tyranny” it is driven by money, but equally so it is driven by those who have lost sight of the sacred principles enshrined in our Constitution, these men and women who put money and power over the moral, foundational Principles of Liberty are our enemies and must be treated and prosecuted as such.

World Bank Corruption Deceit and Greed

Note: This video was not part of the below article.

By James Turnage

Thomas Jefferson wrote in a letter to John Taylor in 1816:  “And I sincerely believe, with you, that banking establishments are more dangerous than standing armies; and the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.”

The World Bank was constructed to lend money to the developing countries of the world.  It was designed to help put an end to world poverty.  A whistleblower by the name of Karen Hudes, former Chief Council for the World Bank for 12 years, claims the organization is filled with corruption, deceit, and greed.

Ms. Hudes says that the World Bank, in collusion with major banking institutions all over the world, is funneling the money to unscrupulous individuals, as well as to the executives of the bank itself.   The bulk of funds never reaches the people for which it is intended.

Ms. Hudes, a lawyer herself, witnessed securities fraud.  Full disclosure of 180 billion dollars-worth of bonds was never made to investors.  It was her job to ensure financial statements for investors were accurate.  She followed the corporate ladder, and reported her findings to the audit committee.  When she received no response, she took her information to the U.S. Treasury Department.  Once again, she was ignored.  When she went to the United States Congress, Senator Richard Luger, Republican from Indiana, sent three letters to the World Bank, asking them not to fire her.  The promptly fired her.

She says that it became obvious to her that Congress had no knowledge of the World Bank’s operations.  Three additional Congressmen asked the General Accounting Office, the GAO, to investigate.

Ms. Hudes claimed the money was ‘going everywhere,’ because when anyone reported the misappropriation of funds, they were fired.  She cited one instance when 900 million dollars was supposed to go to the poor in the Philippines, and instead it was diverted to a man by the name of “Lucio Tonn,” who was behind on his loan payments.  The Philippine National Bank, which never received the money, eventually went bankrupt, and a 500 million dollar bailout ensued.

She says she was attempting to unveil a massive cover-up, that went all the way to Congress, and included 188 ministers of finance around the world.  She claims the result of all the corruption will be a currency war.

Ms. Hudes says there are several World Bank whistleblowers, including the United Kingdom, Mexico, India, and Ethiopia, and that they are all reporting the same information.  The institution is corrupt from top to bottom.

She was asked by Abby Martin of ‘RT’ if she had gone to the financial publications.  Ms. Hudes said she had, but she discovered they were owned by one major conglomerate, which includes nearly all the financial institutions in the world.  She stated that the aim of the Banking community is to control the people of the world and their finances.

She told of the ‘Federal Institute of Technology, in Zurich, Switzerland, where three mathematicians looked at corporate data from 43,000 trans-national companies.  Through complicated maneuvers, they increased their financial power 10 fold, and own 40 percent of the assets of all companies traded on the financial markets of the world, and 60 percent of the earnings yearly.  In many countries, the money being printed has no value.

Ms. Martin said these institutions are obviously laundering money, and hiding much of it in ‘offshore’ accounts.  There is no oversight for most of the institutions, including the World Bank, and that they control geopolitics by controlling many of the world’s governments.

Ms. Hudes said that during the 2012 presidential election, she went to CBS news with information regarding Robert Zellig.  Zellig was the man who would have headed Mitt Romney’s transition team.  He was allegedly part of the Bank’s corrupted management.  CBS declined, saying that “the American people don’t need to know.”  She said that in this way, they were also controlling voters.

When Ms. Martin asked her for names, Hudes said that they were the owners of institutions such as ‘Goldman-Sachs,’ and the ‘Bank of America.’  She further stated that they were all one enormous financial entity, dominating the economic future of the world.

Ms. Martin asked why she hasn’t been singled out, as were Edward Snowden or Bradley Manning.  Ms. Hudes said it may be because all the whistleblowers are working together.  She is surprised that Snowden has received so much attention, because the media is controlled by the government.  The mainstream media is not trusted by the American people, which was shown in a survey.  70 percent of the country said they did not believe what was reported in the news.

The World Bank was created at the 1944 Bretton Woods Conference, along with three other institutions, including the International Monetary Fund (IMF). The World Bank and the IMF are both based in Washington DC, and work closely with each other.

Traditionally, the World Bank has been headed by a citizen of the United States, while the IMF has been led by a European citizen.

The World Bank has two primary divisions.  The International Bank for Reconstruction and Development (IBRD) has 188 member countries, while the International Development Association (IDA) has 172 members.  Each member state of IBRD should be also a member of the International Monetary Fund (IMF) and only members of IBRD are allowed to join other institutions within the Bank (such as IDA).

The World Bank requires sovereign immunity from countries it deals with.   Sovereign immunity waives a holder from all legal liability for their actions. It is proposed that this immunity from responsibility is a “shield which The World Bank wants to resort to, for escaping accountability and security by the people.”  As the United States has veto power, it can prevent the World Bank from taking action against its interests.

With no accountability, it’s easy for the World Bank to be filled with corruption, deceit, and greed.

Network Of Global Corporate Control

A Giant Bow-tie Structure, A Tightly-knit Core Of Financial Institutions

By Stefania Vitali, James B. Glattfelder,  Stefano Battiston

The structure of the control network of transnational corporations affects global market competition and financial stability. So far, only small national samples were studied and there was no appropriate methodology to assess control globally. We present the first investigation of the architecture of the international ownership network, along with the computation of the control held by each global player.

We find that transnational corporations form a giant bow-tie structure and that a large portion of control flows to a small tightly-knit core of financial institutions. This core can be seen as an economic “super-entity” that raises new important issues both for researchers and policy makers.

Introduction

A common intuition among scholars and in the media sees the global economy as being dominated by a handful of powerful transnational corporations (TNCs). However, this has not been confirmed or rejected with explicit numbers. A quantitative investigation is not a trivial task because firms may exert control over other firms via a web of direct and indirect ownership relations which extends over many countries.

Therefore, a complex network analysis [1] is needed in order to uncover the structure of control and its implications. Recently, economic networks have attracted growing attention [2], e.g., networks oftrade [3], products [4], credit [5], [6], stock prices [7] and boards of directors [8], [9].

This literature has also analyzed ownership networks [10], [11], but has neglected the structure of control at a global level. Even the corporate governance literature has only studied small national business groups [12]. Certainly, it is intuitive that every large corporation has a pyramid of subsidiaries below and a number of shareholders above. However, economic theory does not offer models that predict how TNCs globally connect to each other. Three alternative hypotheses can be formulated. TNCs may remain isolated, cluster in separated coalitions, or form a giant connected component, possibly with a core-periphery structure. So far, this issue has remained unaddressed, notwithstanding its important implications for policy making. Indeed, mutual ownership relations among firms within the same sector can, in some cases, jeopardize market competition [13], [14]. Moreover, linkages among financial institutions have been recognized to have ambiguous effects on their financial fragility [15], [16]. Verifying to what extent these implications hold true in the global economy is per se an unexplored field of research and is beyond the scope of this article. However, a necessary precondition to such investigations is to uncover the worldwide structure of corporate control. This was never performed before and it is the aim of the present work.

Methods

Ownership refers to a person or a firm owning another firm entirely or partially. Let  denote the ownership matrix, where the component  is the percentage of ownership that the owner (or shareholder)  holds in firm . This corresponds to a directed weighted graph with firms represented as nodes and ownership ties as links. If, in turn, firm  owns  shares of firm , then firm  has an indirect ownership of firm  (Figure 1 A). In the simplest case, this amounts trivially to the product of the shares of direct ownership . If we now consider the economic value  of firms (e.g., operating revenue in USD), an amount  is associated to  in the direct case, and  in the indirect case. This computation can be extended to a generic graph, with some important caveats [17], Appendix S1, Sections 3.1 and 3.2

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Figure 1. Ownership and Control.

(A&B) Direct and indirect ownership. (A) Firm  has  percent of direct ownership in firm . Through , it has also an indirect ownership in  and . (B) With cycles one has to take into account the recursive paths, see Appendix S1, Section 3.1. (C&D) Threshold model. (C) Percentages of ownership are indicated along the links. (D) If a shareholder has ownership exceeding a threshold (e.g. ), it has full control (100%) and the others have none (0%). More conservative model of control are also considered see Appendix S1, Section 3.1.

doi:10.1371/journal.pone.0025995.g001

Each shareholder has the right to a fraction of the firm revenue (dividend) and to a voice in the decision making process (e.g., voting rights at the shareholder meetings). Thus the larger the ownership share  in a firm, the larger is the associated control over it, denoted as . Intuitively, control corresponds to the chances of seeing one’s own interest prevailing in the business strategy of the firm. Control  is usually computed from ownership  with a simple threshold rule: the majority shareholder has full control. In the example of Figure 1 C, D, this yields  in the direct case and  in the indirect case. As a robustness check, we tested also more conservative models where minorities keep some control (see Appendix S1, Section 3.1). In analogy to ownership, the extension to a generic graph is the notion of network control: . This sums up the value controlled by  through its shares in , plus the value controlled indirectly via the network control of . Thus, network control has the meaning of the total amount of economic value over which  has an influence (e.g.  in Figure 1 D).

Because of indirect links, control flows upstream from many firms and can result in some shareholders becoming very powerful. However, especially in graphs with many cycles (see Figures 1 Band S4 in Appendix S1), the computation of , in the basic formulation detailed above, severely overestimates the control assigned to actors in two cases: firms that are part of cycles (or cross-shareholding structures), and shareholders that are upstream of these structures. An illustration of the problem on a simple network example, together with the details of the method are provided in Appendix S1, Sections 3.2–3.4. A partial solution for small networks was provided in [18]. Previous work on large control networks used a different network construction method and neglected this issue entirely [11], Appendix S1, Sections 2 and 3.5. In this paper, by building on [11], we develop a new methodology to overcome the problem of control overestimation, which can be employed to compute control in large networks.

Results

We start from a list of 43060 TNCs identified according to the OECD definition, taken from a sample of about 30 million economic actors contained in the Orbis 2007 database (see Appendix S1, Section 2). We then apply a recursive search (Figure S1 and Section 2 in Appendix S1) which singles out, for the first time to our knowledge, the network of all the ownership pathways originating from and pointing to TNCs (Figure S2 in Appendix S1). The resulting TNC network includes 600508 nodes and 1006987 ownership ties.

Notice that this data set fundamentally differs from the ones analyzed in [11] (which considered only listed companies in separate countries and their direct shareholders). Here we are interested in the true global ownership network and many TNCs are not listed companies (see also Appendix S1, Section 2).

Network Topology

The computation of control requires a prior analysis of the topology. In terms of connectivity, the network consists of many small connected components, but the largest one (3/4 of all nodes) contains all the top TNCs by economic value, accounting for 94.2% of the total TNC operating revenue (Table 1). Besides the usual network statistics (Figures S5 and S6 in Appendix S1), two topological properties are the most relevant to the focus of this work. The first is the abundance of cycles of length two (mutual cross-shareholdings) or greater (Figure S7 and Section 7 in Appendix S1), which are well studied motifs in corporate governance [19]. A generalization is a strongly connected component (SCC), i.e., a set of firms in which every member owns directly and/or indirectly shares in every other member. This kind of structures, so far observed only in small samples, has explanations such as anti-takeover strategies, reduction of transaction costs, risk sharing, increasing trust and groups of interest [20]. No matter its origin, however, it weakens market competition [13], [14]. The second characteristics is that the largest connect component contains only one dominant strongly connected component (1347 nodes). Thus, similar to the WWW, the TNC network has a bow-tie structure [21] (see Figure 2 A and Appendix S1, Section 6). Its peculiarity is that the strongly connected component, or core, is very small compared to the other sections of the bow-tie, and that the out-section is significantly larger than the in-section and the tubes and tendrils (Figure 2 B and Table 1). The core is also very densely connected, with members having, on average, ties to 20 other members (Figure 2 C, D). As a result, about 3/4 of the ownership of firms in the core remains in the hands of firms of the core itself. In other words, this is a tightly-knit group of corporations that cumulatively hold the majority share of each other.

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Figure 2. Network topology.

(A) A bow-tie consists of in-section (IN), out-section (OUT), strongly connected component or core (SCC), and tubes and tendrils (T&T). (B) Bow-tie structure of the largest connected component (LCC) and other connected components (OCC). Each section volume scales logarithmically with the share of its TNCs operating revenue. In parenthesis, percentage of operating revenue and number of TNCs, cfr. Table 1. (C) SCC layout of the SCC (1318 nodes and 12191 links). Node size scales logarithmically with operation revenue, node color with network control (from yellow to red). Link color scales with weight. (D) Zoom on some major TNCs in the financial sector. Some cycles are highlighted.

doi:10.1371/journal.pone.0025995.g002

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Table 1. Bow-tie statistics.

doi:10.1371/journal.pone.0025995.t001

Notice that the cross-country analysis of [11] found that only a few of the national ownership networks are bow-ties, and, importantly, for the Anglo-Saxon countries, the main strongly connected components are big compared to the network size.

Concentration of Control

The topological analysis carried out so far does not consider the diverse economic value of firms. We thus compute the network control that economic actors (including TNCs) gain over the TNCs’ value (operating revenue) and we address the question of how much this control is concentrated and who are the top control holders. See Figure S3 in Appendix S1 for the distribution of control and operating revenue.

It should be noticed that, although scholars have long measured the concentration of wealth and income [22], there is no prior quantitative estimation for control. Constructing a Lorenz-like curve (Figure 3) allows one to identify the fraction  of top holders holding cumulatively  of the total network control. Thus, the smaller this fraction, the higher the concentration. In principle, one could expect inequality of control to be comparable to inequality of income across households and firms, since shares of most corporations are publicly accessible in stock markets. In contrast, we find that only  top holders accumulate  of the control over the value of all TNCs (see also the list of the top  holders in Table S1 of Appendix S1). The corresponding level of concentration is , to be compared with  for operating revenue. Other sensible comparisons include: income distribution in developed countries with  [22] and corporate revenue in Fortune1000 ( in 2009). This means that network control is much more unequally distributed than wealth. In particular, the top ranked actors hold a control ten times bigger than what could be expected based on their wealth. The results are robust with respect to the models used to estimate control, see Figure 3 and Tables S2 and S3 in Appendix S1.

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Figure 3. Concentration of network control and operating revenue.

Economic actors (TNCs and shareholders) are sorted by descending importance, as given by . A data point located at () corresponds to a fraction  of top economic actors cumulatively holding the fraction  of network control, value or operating revenue. The different curves refer to network control computed with three models (LM, TM, RM), see Appendix S1, Section 3.1, and operating revenue. The horizontal line denotes a value of  equal to . The level of concentration is determined by the  value of the intersection between each curve and the horizontal line. The scale is semi-log.

doi:10.1371/journal.pone.0025995.g003

Discussion

The fact that control is highly concentrated in the hands of few top holders does not determine if and how they are interconnected. It is only by combining topology with control ranking that we obtain a full characterization of the structure of control. A first question we are now able to answer is where the top actors are located in the bow-tie. As the reader may by now suspect, powerful actors tend to belong to the core. In fact, the location of a TNC in the network does matter. For instance, a randomly chosen TNC in the core has about  chance of also being among the top holders, compared to, e.g.,  for the in-section (Table S4 in Appendix S1). A second question concerns what share of total control each component of the bow-tie holds. We find that, despite its small size, the core holds collectively a large fraction of the total network control. In detail, nearly  of the control over the economic value of TNCs in the world is held, via a complicated web of ownership relations, by a group of  TNCs in the core, which has almost full control over itself. The top holders within the core can thus be thought of as an economic “super-entity” in the global network of corporations. A relevant additional fact at this point is that  of the core are financial intermediaries. Figure 2 D shows a small subset of well-known financial players and their links, providing an idea of the level of entanglement of the entire core.

This remarkable finding raises at least two questions that are fundamental to the understanding of the functioning of the global economy. Firstly, what are the implication for global financial stability? It is known that financial institutions establish financial contracts, such as lending or credit derivatives, with several other institutions. This allows them to diversify risk, but, at the same time, it also exposes them to contagion [15]. Unfortunately, information on these contracts is usually not disclosed due to strategic reasons. However, in various countries, the existence of such financial ties is correlated with the existence of ownership relations [23]. Thus, in the hypothesis that the structure of the ownership network is a good proxy for that of the financial network, this implies that the global financial network is also very intricate. Recent works have shown that when a financial network is very densely connected it is prone to systemic risk [16], [24]. Indeed, while in good times the network is seemingly robust, in bad times firms go into distress simultaneously. This knife-edgeproperty [25], [26] was witnessed during the recent financial turmoil.

Secondly, what are the implications for market competition? Since many TNCs in the core have overlapping domains of activity, the fact that they are connected by ownership relations could facilitate the formation of blocs, which would hamper market competition [14]. Remarkably, the existence of such a core in the global market was never documented before and thus, so far, no scientific study demonstrates or excludes that this international “super-entity” has ever acted as a bloc. However, some examples suggest that this is not an unlikely scenario. For instance, previous studies have shown how even small cross-shareholding structures, at a national level, can affect market competition in sectors such as airline, automobile and steel, as well as the financial one [13],[14]. At the same time, antitrust institutions around the world (e.g., the UK Office of Fair Trade) closely monitor complex ownership structures within their national borders. The fact that international data sets as well as methods to handle large networks became available only very recently, may explain how this finding could go unnoticed for so long.

Two issues are worth being addressed here. One may question the idea of putting together data of ownership across countries with diverse legal settings. However, previous empirical work shows that of all possible determinants affecting ownership relations in different countries (e.g., tax rules, level of corruption, institutional settings, etc.), only the level of investor protection is statistically relevant [27]. In any case, it is remarkable that our results on concentration are robust with respect to three very different models used to infer control from ownership. The second issue concerns the control that financial institutions effectively exert. According to some theoretical arguments, in general, financial institutions do not invest in equity shares in order to exert control. However, there is also empirical evidence of the opposite [23], Appendix S1, Section 8.1. Our results show that, globally, top holders are at least in the position to exert considerable control, either formally (e.g., voting in shareholder and board meetings) or via informal negotiations.

Beyond the relevance of these results for economics and policy making, our methodology can be applied to identify key nodes in any real-world network in which a scalar quantity (e.g., resources or energy) flows along directed weighted links. From an empirical point of view, a bow-tie structure with a very small and influential core is a new observation in the study of complex networks. We conjecture that it may be present in other types of networks where “rich-get-richer” mechanisms are at work (although a degree preferential-attachment [1] alone does not produce a bow-tie). However, the fact that the core is so densely connected could be seen as a generalization of the “rich-club phenomenon” with control in the role of degree [3], [28], Appendix S1, Section 8.2. These related open issues could be possibly understood by introducing control in a “fitness model” [29] of network evolution.

Supporting Information

Appendix_S1.pdf

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Supporting material: Acronyms and abbreviations, Data and TNC Network Detection, Network Control, Degree and Strength Distribution Analysis, Connected Components Analysis, Bow-Tie Component Size, Strongly Connected Component Analysis, Network Control Concentration, Additional Tables.

Appendix S1.

Supporting material: Acronyms and abbreviations, Data and TNC Network Detection, Network Control, Degree and Strength Distribution Analysis, Connected Components Analysis, Bow-Tie Component Size, Strongly Connected Component Analysis, Network Control Concentration, Additional Tables.

doi:10.1371/journal.pone.0025995.s001

(PDF)

Acknowledgments

Authors acknowledge F. Schweitzer and C. Tessone for valuable feedback, D. Garcia for generating the 3D figures, and the program Cuttlefish used for networks layout.

Author ContributionsConceived and designed the experiments: SB. Analyzed the data: SV JBG. Wrote the paper: SB SV JBG.

Citation: Vitali S, Glattfelder JB, Battiston S (2011) The Network of Global Corporate Control. PLoS ONE 6(10): e25995. doi:10.1371/journal.pone.0025995

Editor: Alejandro Raul Hernandez Montoya, Universidad Veracruzana, Mexico

Received: March 29, 2011; Accepted: September 15, 2011; Published: October 26, 2011

Copyright: © 2011 Vitali et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Funding: The authors acknowledge financial support from the ETH Competence Center “Coping with Crises in Complex Socio-Economic Systems” (CCSS) through ETH Research Grant CH1-01-08-2; the European Commission FP7 FET Open Project “FOC” No. 255987. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.

Competing interests: The authors have declared that no competing interests exist.

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