Tag Archives: economics

Books, Climate Solutions, Earth Day

These Books take a Hard look how Climate Change & Capitalism Clash

Video

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Naomi Klein’s new book is third in a venerated series on problems we face as a species

As the disasters mount and more and more are definitively linked to man-made climate change and global warming, millions around the globe recognize the need for solutions. More and more the solutions arise, only to be blocked or derailed by the same phenomena: corrupt governments beholden to status quo power and short-sighted corporate greed.

This dynamic; available solutions being actively opposed by business and governments that answer to those powerful corporate entities, even as they mount massive multi-million dollar ad campaigns to “green-wash” their image and try to appear aligned with the very solutions they violently oppose is nearly all pervasive.

Meanwhile, as the problems continue to grow, it has become clear that we, that is to say humanity and its future survivors, are not just fighting a battle against the problem itself, the rapidly deteriorating climate caused by Carbon dioxide (CO2), the primary greenhouse gas emitted through human activities, but even more so a political battle is underway which pits an entire entrenched, unequal and corrupt system (regardless of ideology) against the very issue that needs to be tackled in order for our species to survive.

Without solving the problem of Capitalism’s built-in bias toward profit at any cost, any solution to the climate crisis will be stopped or hindered before it can take root and make enough impact to give us a chance against the looming disasters.

Recently Greta Thunberg posted a statement that governments were literally doing nothing, while at the same time preaching and advertising their “commitment” to solving the problem.

Naomi Klein represents a voice, a top selling author, that has stayed focused on this specific aspect of the challenge for decades. The documentary based on her best-selling book “This Changes Everything” (trailer below) is now a classic and zeros in on the monumental importance of this problem, and how the political and economic systems of the world will require massive and immediate change if we are to survive.

This is not about the tired tropes of Socialism vs Capitalism vs Communism and so on, but rather about the specific corruption and suicidal deception that threatens us all, as fake dedication to solving the problem is paraded simultaneously with efforts that double-down on protecting the homicidal status quo of greed and destruction.

Now, with the Biden administration touting its green status and the green new deal, there must be accountability and more than just words and slogans. The new book shown below is an in-depth look at just what needs to happen to confront the political gridlock and the tendency for real solutions to be blocked or destroyed in the crib.

On Fire: The (Burning) Case for a Green New Deal

Click photo for more on “On Fire“.

Naomi has been at the forefront reporting on the many ways the economy has waged war one planet and people for over 20 years.

An instant bestseller, On Fire shows Klein at her most prophetic and philosophical, investigating the climate crisis not only as a profound political challenge but also as a spiritual and imaginative one. Delving into topics ranging from the clash between ecological time and our culture of “perpetual now,” to the soaring history of humans changing and evolving rapidly in the face of grave threats, to rising white supremacy and fortressed borders as a form of “climate barbarism,” this is a rousing call to action for a planet on the brink. An expansive, far-ranging exploration that sees the battle for a greener world as indistinguishable from the fight for our lives, On Fire captures the burning urgency of the climate crisis, as well as the fiery energy of a rising political movement demanding a catalytic Green New Deal.

Within this text, you will find her essays, written whilst in the midst of natural disasters, dire warnings of the future that is waiting for us if we do nothing to change. The long-forms essays display both the prophetic and philosophical while also challenging the spiritual and imaginative.

Her writings span events ranging from the smoky skies of the Pacific Northwest, the barren Great Barrier Reef to the post-hurricane Puerto Rico and many other climate crises.

This Changes Everything: Capitalism vs. the Climate

Click photo for more on “This Changes Everything“.

Author Naomi Klein wants readers to embrace the radical, that there is no longer the option to remain at the status quo. Climate Change isn’t just something to be “fixed” it is a crisis that requires immediate action. Also now a feature documentary.

In her book she exposes climate change deniers, delusions of geoengineers, why mainstream green initiatives have failed thus far and how capitalism will only make things worst.

The most important book yet from the author of the international bestseller The Shock Doctrine, a brilliant explanation of why the climate crisis challenges us to abandon the core “free market” ideology of our time, restructure the global economy.

The Shock Doctrine: The Rise of Disaster Capitalism

Click photo for more on “The Shock Doctrine“.

Klein introduces us to a new term, disaster capitalism, how those who experience catastrophic events (i.e. war/extreme violence or tsunami/ natural, ect) not only had to suffer from the disaster but also were being taken advantage by “rapid-fire corporate makeovers”.

“The Shock Doctrine” shows how economic policies have capitalized on crises, how at the core of disaster capitalism is to use a cataclysmic event to radicalize privatization.

In her groundbreaking reporting, Naomi Klein introduced the term disaster capitalism. Whether covering Baghdad after the U.S. occupation, Sri Lanka in the wake of the tsunami, or New Orleans post-Katrina, she witnessed something remarkably similar. People still reeling from catastrophe were being hit again, this time with economic shock treatment, losing their land and homes to rapid-fire corporate makeovers. 

The Shock Doctrine retells the story of the most dominant ideology of our time, Milton Friedman’s free market economic revolution. In contrast to the popular myth of this movement’s peaceful global victory, Klein shows how it has exploited moments of shock and extreme violence in order to implement its economic policies in so many parts of the world from Latin America and Eastern Europe to South Africa, Russia, and Iraq.

Watch Trailer for Documentary: ‘This Changes Everything’

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News, Politics

America’s Top 15 Earners and What They Reveal About the U.S. Tax System

by ProPublica

ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.Series: The Secret IRS Files Inside the Tax Records of the .001%

Above: Photo Collage / Lynxotic / Adobe Stock

Periodically, we get a glimpse into the financial lives of the ultrarich. A pro athlete signs a huge contract, a tech CEO sells a boatload of shares in their company, or a billionaire heir unloads a Manhattan penthouse. Based on these nuggets of information, the media speculates as to how much income the rich might bring in every year. But nobody actually knows.

Thanks to an analysis of its unprecedented trove of IRS data, ProPublica is revealing the 15 people who reported the most U.S. income on their taxes from 2013 to 2018, along with data for the rest of the top 400.

The analysis also shows how much they paid in federal income taxes — and it demonstrates how the American tax system, which theoretically makes the highest earners pay the highest income tax rates, fails to do so for the people at the very top of the income pyramid.

The top 400 earners pay noticeably lower tax rates than the merely rich; and, if you include payroll taxes, a married couple making $200,000 a year could end up paying higher tax rates than a person making $200 million a year. (The full analysis is here; it includes selected names beyond the top 15.)

Names That Won’t Surprise You

Scan the names on the list of the top 15 income earners and you’re certain to recognize several names — or at least the names of the companies they founded. Bill Gates hasn’t been involved in the day-to-day operations of Microsoft for over a decade, yet he still earned the most during the years we studied, reporting an average yearly income of $2.85 billion — and an effective federal income tax rate of 18.4%. Steve Ballmer, his former colleague, is also a well-known public figure, both for his time as Microsoft CEO and his current ownership of the Los Angeles Clippers NBA team.

Ballmer’s average annual reported income of $1.05 billion landed him in the 10th spot on the list, and his effective federal income tax rate was 14.1%. The other side of the PC/Mac wars is represented here by Laurene Powell Jobs, widow of Apple founder Steve Jobs.

Her average reported income of $1.57 billion ranked fifth-highest; she paid an effective tax rate of 14.8%. (ProPublica sought comment from everyone mentioned in this article. Nobody disputed the numbers cited here. Unless otherwise noted, representatives for people named in this article either declined to comment, declined to comment on the record or did not respond to requests for comment.)

Another well-known billionaire sits just below Gates on the list: Media and tech mogul and former New York City mayor Michael Bloomberg, with an average reported income of just over $2 billion, paid an effective income tax rate of 4.1%, by far the lowest rate among the top 15. (A spokesperson told ProPublica for an earlier article that Bloomberg “pays the maximum tax rate on all federal, state, local and international taxable income as prescribed by law,” and cited Bloomberg’s philanthropic giving.)

The presence of Amazon founder Jeff Bezos — either the first- or second-wealthiest person in America, depending on the day — won’t shock most people, but Bezos’s annual reported income during these years of $832 million put him only at number 15. He paid an effective tax rate of 23.2%; as we’ve previously reported, Bezos had so little income in a couple of recent years that he was able to pay $0 in federal income taxes in those periods.

Who Are These Others and Why Are They Paying Higher Tax Rates?

Tech billionaires dominate the top 15, but hedge fund managers account for a full third of the names on this list, and some of their incomes were just as huge. Most of them paid relatively high effective tax rates, especially compared to most of the tech sector representatives. Hedge fund managers often make their money through short-term trades, which are taxed at a much higher rate than when tech titans cash in on long-term investments.

The highest-earning hedge funder is Ken Griffin, founder of the Chicago-based firm Citadel. From 2013 to 2018, he reported an average income of nearly $1.7 billion, putting him fourth on the list. Griffin paid a tax rate of 29.2% during these years. (A spokesperson for Griffin said the tax rates in the IRS data “significantly understate” what Griffin pays, because they were lowered by charitable contributions and do not reflect local and state taxes. He also said Griffin pays foreign taxes, which aren’t included in IRS calculations of effective tax rate.)

Israel Englander, co-founder of Millennium Management, paid at a 30.8% rate, while the co-founders of Two Sigma Investments, David Siegel and John Overdeck, paid tax rates of 31.6% and 34.2%, respectively.

Some of this variation in rates reflects how people structure their businesses under tax law. Income earned by publicly traded corporations is taxed at the company level. When it’s passed on to big shareholders, such as tech billionaires, it can come in the form of dividends, which are taxed at lower rates than ordinary income. By contrast, the income from some manufacturing companies and hedge funds flows directly to company owners, who pay taxes on it, resulting in higher effective tax rates on average.

Where Are the Heirs?

Lists of the world’s wealthiest individuals are always heavily populated by heirs, ranging from descendents of old money to scions of more recently minted fortunes. Dozens of heirs made ProPublica’s list of 400 biggest income earners. Descendents and relatives of Sam Walton, founder of Walmart, claim 11 spots.

The DeVos family, heirs to the Amway fortune, also have multiple members in the top 400. Perhaps the best known is Betsy DeVos, who served as U.S. secretary of education during the Donald Trump administration. With a reported annual income of $112 million, she was the 389th-highest earner in this period.

Much like the tech titans who top the list, most of these heirs get their income from dividends or long-term investments, which are taxed at a lower rate. Their effective tax rates ranged from as low as 10.6% for Betsy DeVos to a high of 23% paid by Walmart heirTom Walton.

Don’t Forget the Deductions

Another key way that some top earners reduced their tax liability was to claim significant deductions, often in the form of large charitable contributions. This is particularly true for wealthy investors who are able to make their donations with shares of stock. Thanks to a generous provision of the tax code, they can then deduct the full value of the stock at its current price — without having to first sell it and pay capital gains tax.

Michael Bloomberg achieved a tax rate of 4.1% from 2013 to 2018 by taking annual deductions of more than $1 billion, mostly through charitable contributions. From 2013 to 2017, he also wrote off an average of $400 million each year from what he’d paid in state and local taxes. The 2018 tax overhaul limited that deduction to $10,000 — but also introduced a huge new deduction for pass-through companies that Bloomberg benefited from.

Wait — What About the Celebrities?

The earnings of actors, musicians and sports stars are a subject of nonstop scrutiny in the media, yet few celebrities cracked the list of the top 400 earners, which would have required them to report annual incomes of at least $110 million.

ProPublica’s trove has data on many celebrities. One who came close to the top 400 is basketball superstar LeBron James, who averaged $96 million a year in reported income. Grammy-winning singer Taylor Swift also came within reach of the top 400, averaging $82 million in reported income during these years. Actor George Clooney would have had to double his average income of $55 million to crack the top 400.

THE TOP 15

Here are the details on the top 15 income earners. Read the full analysis of the top 400 here.

For the full list of America’s top 400 income earners and their tax rates, along with our methodology, click here.

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Breaking News, Politics

Dems Introduce Windfall Tax on Big Oil So Companies ‘Pay a Price When They Price Gouge’

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“This is a bill to reduce gas prices and hold Big Oil accountable,” said Rep. Ro Khanna, who led the measure in the U.S. House.

Congressional Democrats on Thursday introduced the bicameral Big Oil Windfall Profits Tax to target price gouging by profit-gorging fossil fuel companies amid Russian President Vladimir Putin’s invasion of Ukraine.

“We need to curb profiteering by Big Oil and provide relief to Americans at the gas pump—that starts with ensuring these corporations pay a price when they price gouge.”

“This is a bill to reduce gas prices and hold Big Oil accountable,” declared Rep. Ro Khanna (D-Calif.), who’s leading the measure in the U.S. House.

“As Russia’s invasion of Ukraine sends gas prices soaring,” said Khanna, “fossil fuel companies are raking in record profits. These companies have made billions and used the profits to enrich their own shareholders while average Americans are hurting at the pump.”

Sen. Sheldon Whitehouse (D-R.I.) introduced the legislation in the upper chamber along with co-sponsors including Sens. Jeff Merkley (D-Ore.), Elizabeth Warren (D-Mass.), and Bernie Sanders (I-Vt.).

The proposal followed President Joe Biden’s announcement earlier this week of a ban on U.S. imports of Russian fuels and amid swelling accusations that Big Oil has been taking advantage of the crisis in Ukraine to “pad their bottom line with war-fueled profits.”

The Democrats’ proposal aims to get some relief for Americans, who are facing average gas prices of $4.31 a gallon.

Big oil companies, specifically those that produce or import at least 300,000 barrels of oil per day, are targeted under the measure. They would face a per-barrel tax—whether the oil is domestically produced or imported—equal to 50% of the difference between the current price of a barrel of oil and the average price per barrel between 2015 and 2019.

The measure exempts smaller companies, which, according to a statement from the lawmakers, account for roughly 70% of the domestic production. This approach is meant to deter the larger multinational producers from simply raising prices.

The tax imposed on the energy firms would be quarterly. Consumers would receive quarterly rebates, with the relief phasing out for single filers earning more than $75,000 annually and joint filers earning more than $150,000 annually. The lawmakers project the tax to raise $45 billion per year at $120 per barrel of oil, delivering to single filers $240 annually and joint filers $360 annually.

“While Putin’s war is causing gas prices to go up, Big Oil companies are raking in record profits,” Warren said in a statement. “We need to curb profiteering by Big Oil and provide relief to Americans at the gas pump—that starts with ensuring these corporations pay a price when they price gouge, and using the revenue to help American families,” she said.

A number of social justice and climate groups heaped praise on the legislative proposal.

According to Richard Wiles, president of the Center for Climate Integrity, “The oil and gas industry got the world into this mess by lobbying and lying to keep us hooked on fossil fuels. Now they’re using the war in Ukraine to distract us from the fact that they are ripping off hard working Americans with high gas prices as they reap record earnings.”

“It’s time we stop allowing Big Oil to use its record profits, earned on the backs of hard-working American families, to reward wealthy shareholders and CEOs, and instead make them pay a fair share to lower the cost for consumers,” he added.

Collin Rees, U.S. program director at Oil Change International, welcomed the proposal as precisely the opposite of what the fossil fuel lobby has called for to counter Putin’s power, namely expanded domestic fossil fuel production.

“The so-called ‘solutions’ to the energy crisis being put forward by Big Oil companies and the American Petroleum Institute would do nothing but further line their own pockets and lock in a climate-wrecking, fossil-fueled future,” he said. “What’s needed now is immediate relief for American consumers, which is what this commonsense windfall profits tax bill would provide.”

The bill also drew plaudits from Lukas Ross, program manager at Friends of the Earth, which released an analysis Thursday along with BailoutWatch finding that Big Oil CEOs have “absolutely” used the spiked in fuel prices triggered by Russia’s invasion of Ukraine to “price-gouge and profiteer.”

In a statement responding to the new legislation, Ross said: “All-American oil oligarchs are profiteering off the war in Ukraine while sacrificing our communities and climate. The windfall profits tax will require Big Oil to pay their fair share while putting billions of dollars back into the pockets of taxpayers.”

Originally published on Common Dreams by ANDREA GERMANOS and republished under  a Creative Commons license (CC BY-NC-ND 3.0)

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Climate Solutions, News, Observation, Politics

Drill, Baby, Drill: Capitalism’s Only Plan for Climate Is Collapse

Photo by Zbynek Burival on Unsplash

If we continue not acting against the real cause of the climate crisis—the capitalist mode of production and the capitalist worldview—they will take it as a social license to carry on with collapse.

This past week’s flurry of announcements over “ambitious action” by governments during the COP26 in Glasgow has been justly received with scepticism by climate justice activists and the general public (and enthusiastic support by the media in general). During this same period important revelations of the massive gap in terms of necessary emission cuts and country’s plans emerged, as the broader rejection of greenwashing became pervasive. The narrative of false solutions and green capitalism doesn’t work. Yesterday, the revelation that over 800 oil & gas wells are being planned for drilling still this year and in 2022, in the report “Drill, Baby, Drill“, makes it clear that the proceedings of COP26 are mostly propaganda, as the only real, mandatory and contractualized plan global capitalism has for the climate crisis is collapse.

The reason why the climate crisis is not being solved is because it will lead to the biggest shift in power in the history of humanity, it will lead to the biggest transfer of wealth and loss of profit in history.

The scenario is the most dire ever. Not only the concentration of CO2 in the atmosphere is at its highest for millions of years, temperatures keep pushing closer to 1.5ºC and emissions are rising once again after the Covid hiatus. The IPCC scientists have leaked the second draft of Group II’s report, which states that “estimates of committed CO2 emissions from current fossil energy infrastructure are 658 GtCO2 […] nearly the double the remaining carbon budget,” revealing that “others [scientists] stress that climate change is caused by industrial development and more specifically the character of social and economic development produced by the nature of the capitalist society, which they therefore view as ultimately unsustainable.” In a few months, we will understand the level of political and business editing in the final report that finally comes out.

Yet, current infrastructure is not enough for global capitalism. In the “Drill, Baby, Drill” report, made public by the Glasgow Agreement at the COP26 Coalition’s People Summit, a still bigger measure of incoherence appears. There are 816 new oil & gas wells being planned and drilled until the end of the year and in 2022. These are located in 76 countries all around the world, countries whose governments are currently sitting in the halls of the COP26 in Glasgow, to “negotiate” a solution for the climate crisis.

The host UK appears close to the top of desired new wells, with 36, mostly offshore, in the basins of Central Graben, Moray Firth, the North Sea and Shetland. It is very likely that while Boris Johnson was doing his James Bond gag on stage, at least some four wells were being drilled to add to British fossil fuel reserves, making him a sort of meta-Bond villain. The top of the ranking for most wells planned goes to Australia and Russia, with 80 wells each, closely followed by Mexico with 78. Australia, Russia, Mexico, Indonesia, USA, Norway, UK, Brazil and Myanmar plan to drill over 500 oil & gas wells between now and the end of 2022. The report points out that this is very likely an underestimation. The companies most involved in drilling these wells are the gallery of the usual suspects: ENI, Petronas, Shell, Equinor, Total, Pemex, BP, Pertamina, Chevron and ExxonMobil. There are at least 67 wells planned above the Arctic Polar Circle. Total and ExxonMobil are in a contest to drill the deepest well ever in the ocean (Total is going for 3628m deep in Angola, and ExxonMobil is going for 3800m deep in Brazil). Many of these companies are spending millions every year on propaganda for carbon neutrality and other false solutions, blocking real action and expanding their operations.

The report also includes a sample of wells drilled in 2021 so far, with China on top, followed by Turkey, Russia, Norway, Indonesia, Mexico, Pakistan, Australia and Egypt, the host for the next COP.

This shouldn’t come as a surprise to anyone. It is the way this system operates: just enough propaganda of “ambition” and technofixes to keep fossils flowing as ever, while the climate collapses. The information does provide us with a question: if the on climate change debate is framed by companies and governments around the terms of net-zero, carbon credits, carbon taxes and offsettings, rather than stopping emissions, when will it ever come to the real problem of the climate crisis? Well, never. And that is the purpose.

Governments and companies are actively engaged in not cutting emissions, but also in effectively increasing them. Each and every one of these wells is a public crime against Humanity and all species on this planet, advertised in advance. It is good that we know them, though, for it is better to know fossil capitalism’s plans to collapse us beforehand and in as much detail as possible. That is why the call on the report does not go out to governments and fossil companies to suddenly act after over three decades of expanding fossil use. The call goes out to the climate justice movement and civil society: spread this information far and wide, act on it, campaign on it, block, stop and detain all of these projects. Other millions of fossil and fossil-based projects compose the menu of collapse daily confirmed by governments and companies. They are the legally binding commitment for our collapse and need to be stopped.

The overwhelming agreement on the reason why the climate crisis is not being fixed is becoming as high as the overwhelming scientific agreement on the cause of the climate crisis. The reason why the climate crisis is not being solved is because it will lead to the biggest shift in power in the history of humanity, it will lead to the biggest transfer of wealth and loss of profit in history. That means very little to the majority of the human population, as we will be the beneficiaries of this shift, of this transfer, of this redistribution. If we solve this crisis, we will have the chance to heal our battered planet. That is why their plan means collapse: they refuse to abdicate an inch of their brutal privilege and power. If we continue not acting against the real cause of the climate crisis—the capitalist mode of production and the capitalist worldview—they will take it as a social license to carry on with collapse. Even without social license, their plan will always lead to collapse. It’s not circumstantial, it is the core of this system. We need to collapse them.

Originally published on Common Dreams by JOÃO CAMARGO and republished under Creative Commons (CC BY-NC-ND 3.0)

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Hot-Lynx

Congress want Amazon to Prove Bezos didn’t give perjured Testimony

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While still CEO of Amazon, Jeff Bezos testified in Congress by video conference on July 29, 2020. Now, there are at least Five members of a congressional committee alleging that he and other executives may have lied under oath andmisled lawmakers.

In a press release by the House Judiciary Antitrust Subcommittee the lawmakers state that they are giving Amazon a “Final Chance to Correct the Record Following a Series of Misleading Testimony and Statements”.

CurrentAmazon CEO Andy Jassy, who, in July, succeeded Bezos is being asked to respond to the discrepancies, including information found by The Markup published in a recent article

Read More at:

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Business, News, Observation, Politics

After Docs ‘Show What We Feared’ About Amazon’s Monopoly Power, Warren Says ‘Break It Up’

Leaked documents reveal the e-commerce company’s private-brands team in India “secretly exploited internal data” to copy products from other sellers and rigged search results.

U.S. Sen. Elizabeth Warren on Wednesday renewed her call to break up Amazon after internal documents obtained by Reuters revealed that the e-commerce giant engaged in anti-competitive behavior in India that it has long denied, including in testimonies from company leaders to Congress.

“These documents show what we feared about Amazon’s monopoly power—that the company is willing and able to rig its platform to benefit its bottom line while stiffing small businesses and entrepreneurs,” tweeted Warren (D-Mass.) “This is one of the many reasons we need to break it up.”

Warren is a vocal advocate of breaking up tech giants including but not limited to Amazon. The company faces investigations regarding alleged anti-competitive behavior in the United States as well as Europe and India. The investigative report may ramp up such probes.

Aditya Karla and Steve Stecklow report that “thousands of pages of internal Amazon documents examined by Reuters—including emails, strategy papers, and business plans—show the company ran a systematic campaign of creating knockoffs and manipulating search results to boost its own product lines in India, one of the company’s largest growth markets.”

“The documents reveal how Amazon’s private-brands team in India secretly exploited internal data from Amazon.in to copy products sold by other companies, and then offered them on its platform,” according to the reporters. “The employees also stoked sales of Amazon private-brand products by rigging Amazon’s search results.”

As Reuters notes:

In sworn testimony before the U.S. Congress in 2020, Amazon founder Jeff Bezos explained that the e-commerce giant prohibits its employees from using the data on individual sellers to help its private-label business. And, in 2019, another Amazon executive testified that the company does not use such data to create its own private-label products or alter its search results to favor them.

But the internal documents seen by Reuters show for the first time that, at least in India, manipulating search results to favor Amazon’s own products, as well as copying other sellers’ goods, were part of a formal, clandestine strategy at Amazon—and that high-level executives were told about it. The documents show that two executives reviewed the India strategy—senior vice presidents Diego Piacentini, who has since left the company, and Russell Grandinetti, who currently runs Amazon’s international consumer business.

While neither Piacentini nor Grandinetti responded to Reuters‘ requests for comment, Amazon provided a written response that did not address the reporters’ questions.

“As Reuters hasn’t shared the documents or their provenance with us, we are unable to confirm the veracity or otherwise of the information and claims as stated,” Amazon said. “We believe these claims are factually incorrect and unsubstantiated.”

“We display search results based on relevance to the customer’s search query, irrespective of whether such products have private brands offered by sellers or not,” the company said, adding that it “strictly prohibits the use or sharing of nonpublic, seller-specific data for the benefit of any seller, including sellers of private brands.”

Warren was not alone in calling for the breakup of Amazon following the report.

“This is not shocking. But it is appalling,” the American Economic Liberties Project said in a series of tweets. “Independent businesses have sounded the alarm for years—providing evidence that Amazon stole their intellectual property.”

“We said back in 2020 that a perjury referral was in order—and it still is,” the group added, highlighting testimony from Bezos and Nate Sutton, Amazon’s associate general counsel. “But Amazon will remain an anti-business behemoth, flagrantly breaking the law and daring policymakers to stop them.”

Highlighting a report from a trio of its experts, Economic Liberties added that “it’s time to break Amazon up.”

Originally published on Common Dreams by JESSICA CORBETT and republished under a Creative Commons license  (CC BY-NC-ND 3.0).

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Books, Business, Economics, Finance, Observation, Politics, Tech

In: ‘Antitrust: Taking on Monopoly Power from the Gilded Age to the Digital Age’, Amy Klobuchar Takes on World’s Greatest Challenge

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Is the title above wrong? Depends who you ask…

In her new book, Klobuchar tries to connect the historical roots of antitrust actions to populism and her own ancestry. That’s not all, however. Although difficult, particularly for readers who are not legal scholars, there’s an important and deeper historic thread here that she is aiming to contribute to.

That job is to find a way to illuminate how the digital age, with all its challenges and complexities, can come to terms with the simple question of how to measure damage that is being done by big tech monopolies, through sheer size, power and lack of external accountability.

Moreover, there is an issue of how antitrust law and practice veered away from the remedies and goals, first established during the Gilded Age, toward a laissez-fair, anti-regulatory stance that gained steam in the Regan years.

That shift is, in many ways, to blame for the current extreme state characterized by dangerous levels of concentrated wealth and power by big tech.

This effort may seem like one that is doomed to being ignored by all but the already long-since converted. But, make no mistake, it is a topic that will grow, reverberate and become more relevant as the current administration in Washington consolidates and comes into its own.

“People have just gotten beaten down. I wanted to show the public and elected officials that you’re not the first kids on the block with this. What do you think it was like back when trusts literally controlled everyone on the Supreme Court, or literally elected members of the Senate before they were elected by the public?”

— Amy Klobuchar, in Wired interview with Steven Levey

When President Biden recently nominated Lina M. Khan to the Federal Trade Commission, in addition to Columbia Law School professor Tim Wu, who announced earlier this month he would join the National Economic Council, he set forth a clear path for an antitrust direction that has the potential to be more than just rhetoric and window dressing.

Khan is an unequivocal proponent of a new era of antitrust, one that is, not coincidentally, along the lines of what Klobuchar advocates. Likely sharing these ultra clear views from her long and celebrated research, Khan, along with Wu, is a key addition to Biden’s growing roster of Big Tech critics, and there is already a blueprint for actions and cases that will build to a crescendo over the next several years.

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Biden’s call for the repeal of Section 230 of the Communications Decency Act, meanwhile, a hotly contested and possibly flawed legal shield some feel is exploited by Internet platforms, is another indicator of the tenor of the coming actions.

In a sense, with this bestselling book [on Amazon: #1 in Political Economy, #1 in Government Management, #1 in Business Law (Books)] the gargantuan task of connecting the culpability of massive, nearly infinitely powerful behemoths, each in it’s own territory, to the social and economic catastrophes that they’ve brought down on the world.

However, while politicians like Klobuchar may not have the charisma and energy to set a fire under the population, it is the very deeds themselves that will eventually conspire to ignite an uprising and put pressure on the government and the courts to take real, substantive measures. And with young, new faces and minds such as possessed by Khan and Wu, ultimately there is a bulwark of criticism against monopolist abuses building in government and among the public at large.

“I am never saying, ‘Get rid of their products.’ But let’s have more of the products that give you more choices. You can keep one product, but it’s better to have other products, because we’re not China.”

Amy Klobuchar in Wired interview with Steven Levey

 In response to Klobuchar’s quote above Steven Levey in Wired wrote; “In other words, Facebook could keep it’s main app, but the public might benefit if Instagram and WhatsApp were not Mark Zuckerberg productions.” 

While this kind of “moderate” view may not be the earth shattering remedy that would turn the juggernauts around in a heartbeat, from Zuckerberg’s perspective it would not be ideal, to say the least.

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And, since we have seen the unfettered and viral growth of big tech, for at least a quarter century in some cases, and since there was a aura of hero worship afforded their leaders for most of that time, a break-up, such as that could ultimately turn out to be the beginning of more sweeping changes. A welcome outcome for those that have been harmed the various monopolistic structures that rule nearly all our lives, or at least it seems, at times.

Levey then asked Klobuchar why legislators so often embarrass themselves in hearings with irrelevant partisanship, clueless technical questions, and time-wasting grandstanding. Her response;

“Welcome to my life,” she says. “I get it—there’s going to be hearings that are irritating to people who know a lot. But that’s a great argument for tech to use because they don’t want this oversight.” 

Amy Klobuchar in Wired interview with Steven Levey

In defense of using the word “antitrust in the title, while also advocating its eradication in future she responded:

 “Well, I thought antitrust was an interesting word”. “It’s not only about this body of law; it’s also about not trusting anyone.”

Amy Klobuchar in Wired interview with Steven Levey

Perhaps it is more the course of history that led to the current and incredibly extreme situation and obscene dominance by big tech that is what should never have be trusted to arise in the first place.

Perhaps these firms will one day be seen, looking back from future generations, as a temporarily necessary, but evil mistake of history, as was the toothless interpretation of laws that led to their rise from “scrappy underdog startups” into malignant monopolies run amok.

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Business, Stock Market, Tech

Elon Musk, Tesla & SpaceX income from Carbon Tax Credits, Bitcoin and Government Subsidies

Video

Above: Photo collage / Forbes / Lynxotic

Odd facts that illustrate the world today where Elon Musk says BitCoin is “less dumb” than cash. He’s right. Cash also known a “fiat currency” is a piece of paper with a promise to pay on demand nothing in exchange when presented.

It does have a legal framework behind it, meaning you go to jail if you try to use your own version. There’s that.

The Tesla CEO said that investing in Bitcoin is a “less dumb form of liquidity than cash” after his company bought $1.5 billion of the cryptocurrency.

“To be clear, I am not an investor, I am an engineer,” he said on Twitter. “I don’t even own any publicly traded stock besides Tesla.”

The idea that Tesla and other companies are having concerns over the stability of cash, and concerns over the effectively negative interest rates in the mean time is clear.

Bitcoin may not be a solution that will be permitted by the Government (think gold in 1934). But a reckoning is a-comin’ and it will get interesting.

There is no doubt that Elon Musk is a genius who is doing great things. Perhaps it is his genius for finance that is most underestimated, however, considering his funding success throughout the years.

Some stats:

Regulatory Credits, aka, Carbon Tax credits, as per CNN:

It’s a lucrative business for Tesla — bringing in $3.3 billion over the course of the last five years, nearly half of that in 2020 alone. The $1.6 billion in regulatory credits it received last year far outweighed Tesla’s net income of $721 million — meaning Tesla would have otherwise posted a net loss in 2020.

“Based on our calculations, we estimate that Tesla so far has made roughly $1 billion of profit [on Bitcoin holdings] over the last month…To put this in perspective, Tesla is on a trajectory to make more from its Bitcoin investments than profits from selling its EVs in all of 2020…” source: Wedbush’s analyst Dan Ives

SpaceX income in U.S. Gov contracts and subsidies:

LA times estimated that already by 2015 Various Musk led businesses took in over 4.9 billion in government income:

“Tesla Motors Inc., SolarCity Corp. and Space Exploration Technologies Corp., known as SpaceX, together have benefited from an estimated $4.9 billion in government support, according to data compiled by The Times. The figure underscores a common theme running through his emerging empire: a public-private financing model underpinning long-shot start-ups.” – LA Times

More recently in 2020 in Forbes:

“The research note titled SpaceX: Raising Valuation Scenarios Following Key Developments, listed the company’s recent $1.9 billion funding round and the “continued momentum in winning government contracts” (mainly from NASA and the U.S Department of Defense) as key reasons for its revision of SpaceX’s value. The note doesn’t bother to mention important financial details like SpaceX’s current revenue or estimated revenue for 2020 or even 2021. Or whether SpaceX is profitable or not.”

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Economics, Stock Market

Stocks Dive, Trump Goes Berserk: It’s Not Sexy, but the Inverted Yield Curve has Never Been Wrong

Stocks decline a day after Trump gave the markets a jolt of optimism…

Truth is, no one knows why stocks bounce one day and collapse the next. Yesterday, the reduction in trade war tensions, due to the postponement of a tariff increase, was credited with the surge in market prices.

Today, all major indices are down around 3%, while the VIX, known as the “fear index” spiked 20% higher, and there are plenty of factors that may have set the sell-off in motion:

This time, it’s the inversion of the yield curve that is given the blame, primarily, for the Dow Jones Industrial Average being down, at the end of Wednesday’s session, over 800 points. Asleep yet?

Don’t worry, this won’t take long: 

The Mysterious Yield Curve, Deconstructed

When shorter dated bonds, bonds that “mature” sooner, have higher yields (pay a higher percentage in interest) than longer dated ones, that’s an inverted yield curve. Inverted, because, it is not “normal” to be paid more for taking less risk, that is to say, holding a bond for a shorter period of time. Also, it’s not logical. 

Unless, in theory, people are seeing the near term risk as higher than the long term one. Which, honestly, may or may not be accurate, but perception is all and all.

And this is not the first inversion lately. For several months, since March, the 3-month yield rose above the 10-year, then again in July and has remained so. However, today it’s the 2-year vs. the 10-year, and it is considered the “main” pair, and that’s what got the ball rolling down hill. 

Extremes are also a concern. For example, the 30-year Treasury yield dropped to it’s lowest rate ever at 2.05%.

And, to top it all off, the snowball begins to roll when the 2-year vs. 10-year curve inverts, particularly due to the history of what happens after this phenomena occurs. 

The R word. Yes, recession. Not sometimes. Always. At least so far. 

Not necessarily right away. The first inversion prior to the 2008 financial crisis was in December of 2005. However, according to the Fed Bank of Cleveland, a recession can generally be expected approximately one year after the yield curve inverts. 

Trump Goes Berserk. Blames Fed Chairman and the “Crazy” Curve!

Does this guy sound worried?

Germany and China Numbers and That Pesky Trade War that Tariff-man loves so much

Ok, that’s pretty much the bond story. Other factors weighing on stock prices? There’s that pesky trade war with China which, yesterday’s jubilation notwithstanding, is not over. Not by a long shot. 

Then, in came the news that Germany’s GDP contracted for the first time in ten years. What has been called the “Golden Decade” for the mighty Teutonic economy, the world’s 4th largest, is now officially at an end. 

This, again, ties back to the trade wars as Germany is an export driven economy and exports to the US and China, (who, as we know are locked in their battle over trade) primarily and mainly cars. Car sales, particularly in China, are very weak. In China the sales figure have gone down for the last 13 months. 

Also in China, industrial production, it was announced, in July of 2019 was weaker than for the same month in 2018. Still a positive number, mind you, at 4.8%, but the lowest growth percentage in 17 years. 

Other economic numbers for the Chinese economy, also announced today, were weak in many key segments. Retail sales were less than expected and unemployment is on the rise. All in all, a gloomy report for what has been the rising star on the world stage in terms of growth. 

Plenty of Triggers, not many Rainbows

So, if we are looking for reasons why people in the stock markets, generally, might be in the mood to sell, we can point to these factors, not to mention political dangers in Asia with the ongoing Hong Kong protests, and tension. 

Although sometimes people sell just to sell (often politely called “profit taking”) this appears to be something else. 

Also, while it is too early to say that any positive effect will arise in trade talks, with the US and China both feeling weaker and therefore more accommodating, that is, at least one possible silver lining. 

Another is that, for the first time in all recorded history of the bond market, the inversion might not lead to a recession, after all.

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Business, Economics, Stock Market

Stock Market Outlook 2019

Consensus Views Or Contrary Swans

Funny thing about consensus vs. contrary views – they are often identical if you believe what you read. “Wall of worry” and “Slope of Hope”: it’s all irrelevant if you are wearing blinders and have no mooring, or any basis for what the facts are.

Add to all that the fact that most opinions are paid advertisements, mainly for sell-side firms, and it’s tough to wade through the B.S. As per usual, according to a survey from CNBC, the S&P 500 will reach 3000 by the end of 2019.

According to my own non-scientific survey this is the 20th consecutive year that such surveys predict a gain in the market. A prediction for the coming or current year is almost always positive. The negative predictions are saved for “next year” (in other words later in 2020 as seen from in early 2019). Then, of course, the predictions change, and turn positive, just before the year turns.

Such nonsense goes even deeper while pundits and hacks will cite “pervasive pessimism” in the face of almost total bullishness to claim to have a “contrary” view while in reality herding like Spanish bulls in springtime.

“It’s tough to make predictions, especially about the future”

Yogi Berra

Using actual data such as the Put-Call Ratio, VIX, AAII Sentiment Survey, or, for example, levels of margin debt and mutual fund money flows, can at least give a picture of the state against which one intends to be contrary.


Then, once in a while, in full-on Black Swan fashion, the prevailing “wisdom” blows up and everyone declares shock that such a thing could happen. A recent example of this was the disastrous collapse of the “short vol” trade in February of 2018.

A one-eyed man in the land of the blind can see a bit more than the rest. A first step is to be aware of the hype and see past the herd. In the last 100 years, Bull markets have tended to last longer than Bear markets (which move faster) and that alone leads to a bias toward a false idea that investing in stocks can lead to a steady, constant gain profile.

To sum up our outlook for 2019 in terms of end of year projections, the word “grim” comes to mind. Bear Markets follow Bull Markets, Raising Rates pop bubbles, the 2008 excess was never dealt with, and on and on and on. Clearly, the most bullish possible prediction anyone looking at facts could possibly make is that the next down phase in the market might come a bit later (2020 anyone?) rather than sooner.

Naturally, that is exactly what the “pessimistic” pundits are predicting. Far from pessimistic in reality, this is the most wildly optimistic, bullish possible take on the current juncture imaginable. Perfect for the true contrarian outlook which points toward a real Bear Market, sooner rather than later.

This is not to say that it looks like all gloom and doom for the coming year(s). There are exciting changes afoot, particularly in media and digital communication, and, as with all times of great change, the aftermath of the coming storm points toward a cleansing and realignment of world economies and cultures. Bring it on…….

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