Local Stories, Events
Ref. : Civic Events
Ref. : Arts & Education Events
Ref. : Public Service Notices
Books, Films, Arts & Education
Ref. : Letters to the editor
Health Care & Environment
07.20 Until Emissions Drop, Nothing Has Been Accomplished: The Climate Resistance Handbook Is Here. [Trump can't be bothered as the world turns into a large cinder. His laser focus is on personal greed.]
07.20 With Petition to Congress, 100,000+ People Demand Green New Deal 'That Fixes Our Food System' [Realtime proactive response to reality—now and threatening—doesn't get attention in this greed focused administration]
07.19 Trump administration won't ban pesticide tied to childhood brain damage [There is no truth to the persistent rumor that chlorpyrifos pesticide was heavily used at Trump's childhood home in Queens]
07.17 Planned Parenthood president Leana Wen forced out by board [Given that states have lost abortion rights on political grounds recently, Wen's philosophical approach to protect abortion rights based on ‘health care’ was smarter – therefore it was that smarter strategy that was killed at the secret meeting.]
07.17 What is happening in America's Cancertown is tragic, immoral and evil [Niggardly white government policies could change to produce better students, better jobs and net revenue instead of costs. But it seems they enjoy more cruelty—like Trump.]
07.15 Extinction Rebellion protests block traffic in five UK cities [Non-corporate human animals make their annoying bleating sounds...]
07.14 A Glacier the Size of Florida Is Becoming Unstable. It Has Dire Implications for Global Sea Levels [The willfully ignorant needn't read more, Trump]
07.13 'Climate Despair' Is Making People Give Up on Life [Willfully ignorant governments—having fired many of their best scientists—have made themselves too stupid to despair]
07.13 Trump administration to approve pesticide that may harm bees [The worst government money can buy!]
07.11 7,000+ Colleges and Universities Declare Climate Emergency and Unveil Three-Point Plan to Combat It [Fox News and Betsy DeVos never talk about this stuff so it must be Bull Shit, right?]
07.10 Plastic Has A Big Carbon Footprint — But That Isn't The Whole Story [Fixing our world begins by educating your consciousness with the best truth from trustworthy news sources—so you'll then insist truly bad things will get fixed. But if instead you are educated by untrustworthy news sources—then your consciousness could be warped to where you are hating and fighting with your best friends. Clue: untrustworthy news sources never seriously report news about the world's most critical emergency—Global warming.]
07.09 Judge reinstates Madrid's low emissions zone [Yeh!]
07.07 How Solar Panels Work (And Why They're Taking Over the World) [Hope they leave space between panels for wild flowers to grow so birds and butterflies can flourish!]
News Media Matters
US Politics, Policy & 'Culture'
07.20 Fact check: Trump says Puerto Rico got $92 billion. They've seen only a fraction [If he opens his mouth, Trump's lying.]
07.20 Trump Denies Being at North Carolina Rally [Not sure if Trump supporters 'get' satire, but here goes....]
07.18 Inside Trump's DC hotel, where allies and lobbyists flock to peddle their interests [Also, too much ignored by media, the $millions "donated" corrupting moderate Democrats and Republicans every election cycle must stop]
07.18 This Republican's Case for Medicare for All [A well-informed Republican is rare, so let's hold him in the light so others may learn]
07.18 Trump rally crowd chants 'send her back' after president attacks Ilhan Omar [1:03 video shows Trump pandering to his ignorant idolaters, and together they're making America a greater shit-hole country]
High Crimes vs. Human Rights
07.19 Conscientious objectors of first world war – their untold tales [The record proves they were morally right by avoiding violent early deaths of their cousins and themselves]
Economics & Corrupt Capitalism
International & Futurism
07.20 US to deploy troops to Saudi Arabia in face of 'credible' regional threats [Working with Osama bin Laden's godfathers, Trump wants to profit like Erik Prince (for-profit education secretary Betsy DeVos' brother) of Blackwater infamy (hurriedly renamed ‘Academi’), the U.S. taxpayer to pay inflated costs while Trump siphons off long-term emolument largesse]
07.20 Iran on 'dangerous path' with seizure of Stena Impero, says UK [Which is this, a tit or a tat?]
07.20 'Dark satanic mills': Tony Abbott continues his crusade against wind turbines [Too much CO2 air pollution makes you stupid, and turns your country into an “Idiocracy” (1:36 video clip)]
07.20 Bolsonaro declares 'the Amazon is ours' and calls deforestation data 'lies' [Lazy and willfully stupid whenever it serves his purpose, just like Trump. “And the rest of you can all go to hell.” Again, just like Trump. Has your country turned into an “Idiocracy”? (1:36 video clip)]
07.19 Iran makes 'substantial' nuclear offer in return for US lifting sanctions [Was barbaric Saudi Arabia—whose citizens were more involved in the 9-11 attacks—the wrong ally all along?]
07.19 “The Task Ahead Is Enormous, and There Is Not Much Time” [Read this and learn. Or read Donald J. Trump (@realDonaldTrump) | Twitter and/or President Trump (@POTUS) | Twitter. Are you serious? Or are you in hideously criminal denial?]
07.18 ‘No rioters, only a tyrannical regime’: Thousands of Hong Kong seniors march in support of young extradition law protesters [Most people around the world have more in common with these Hong Kong Chinese protestors than with the ignorant people at Trump rallies]
07.18 Dozens Arrested as Over 1,000 Jewish Activists and Allies Shut Down Entrances to ICE Headquarters Demanding Closure of Trump Detention Camps [Obviously these are not the immoral and less educated right-wing jews who support Netanyahu, Trump and ICE, and who slowly exterminate Palestinians when no one is looking]
China's Creative Accounting: How It Buried Its Debt and Forged Ahead with Stimulus
Originally published on Thursday, 28 October 2010
China's government can direct its banks to advance credit in the national currency as needed, because it owns the banks. Ironically, the Chinese evidently got that idea from us.
China may be as heavily in debt as we are. It just has a different way of keeping its books -- which makes a high-profile political ad sponsored by Citizens Against Government Waste, a fiscally conservative think tank, particularly ironic. Set in a lecture hall in China in 2030, the controversial ad shows a Chinese professor lecturing on the fall of empires: Greece, Rome, Great Britain, the United States . . . .
Of course, he says, because the Chinese owned the debt, they are now masters of the Americans. The students laugh. The ad concludes, "You can change the future. You have to."
James Fallows, writing in the Atlantic, remarks:
That is one anomaly. Another is that China has managed to keep its debt remarkably low despite decades of massive government spending. According to the IMF, China's cumulative gross debt is only about 22% of 2010 GDP, compared to a U.S. gross debt that is 94% of 2010 GDP.
What is China's secret? According to financial commentator Jim Jubak, it may just be “creative accounting” -- the sort of accounting for which Wall Street is notorious, in which debts are swept off the books and turned into “assets.” China is able to pull this off because it does not owe its debts to foreign creditors. The banks doing the funding are state-owned, and the state can write off its own debts.
The majority of bank loans, says Jubak, went to state-owned companies -- about 70% of the total. The collapse of China's export trade following the crisis meant that its banks were suddenly sitting on billions in debts that were clearly never going to be paid. But that was when China's largest banks were trying to raise capital by selling stock in Hong Kong and New York, and no bank could go public with that much bad debt on its books.
The creative solution? The Beijing government set up special-purpose asset management companies for the four largest state-owned banks, the equivalent of the “special purpose vehicles” designed by Wall Street to funnel real estate loans off U.S. bank books. The Chinese entities ultimately bought $287 billion in bad loans from state-owned banks. To pay for the loans, they issued bonds to the banks, on which they paid interest. The state-owned banks thus got $287 billion in toxic debt off their books and turned the bad loans into an income stream from the bonds.
Sound familiar? Wall Street did the same thing in the 2008 bailout, with the U.S. government underwriting the deal. The difference was that China's largest banks were owned by the government, so the government rather than a private banking cartel got the benefit of the arrangement. According to British economist Samah El-Shahat, writing in Al Jazeera in August 2009:
In the US and UK, by contrast:
Today, Jubak continues, China's debt problem is the thousands of investment companies set up by local governments to borrow money from banks and lend it to local companies, a policy that has produced thousands of jobs but has left an off-balance-sheet debt overhang. He cites economist Victor Shih, who says local-government investment companies had a total of $1.7 trillion in outstanding debt at the end of 2009, or about 35% of China's GDP. Banks have extended $1.9 trillion in credit lines to local investment companies on top of that. Collectively, the debt plus the credit lines come to $3.8 trillion. That is about 75% of China's GDP, which is proportionately quite a bit smaller than U.S. GDP. None of this is included in the IMF's calculation of a gross-debt-to-GDP figure of 22%, says Shih. If it were, the number would be closer to 100% of GDP.
Proportionately China may be more heavily in debt than we are. Yet it is still managing to invest heavily in infrastructure, local businesses and local jobs. Its creative accounting scheme seems to be working for the Chinese.
Proportionately, then, China may be more heavily in debt than we are. Yet it is still managing to invest heavily in infrastructure, local businesses and local jobs. Its creative accounting scheme seems to be working for the Chinese. It may be sleight of hand, but it was a necessary ploy to harmonize their economic realities with Western banking standards.
For China to join the World Trade Organization in 2001, it had to revise its accounting methods to conform to Western requirements; but before it joined, it did not consider grants to its state-owned enterprises to be “non-performing loans.” They were what the IMF calls “contingent grants.” If they paid off, great; if they didn't, they were written off. There were no creditors demanding payment from the state-owned banks. The creditor was the state; and the state, at least in theory, was the people. In any case, the state owned the banks. It was lending to itself, and it could write off its loans at will. It was better to sweep the “NPLs” into “SPVs” than to cut back on services and impose heavier taxes on the people. The Chinese government did cut back on services and raise taxes, to the detriment of the struggling masses, but not to the extent that would otherwise have been necessary to balance their books by Western standards.
While the rest of the world suffers from an unrelenting credit crunch, today China's banks are on a lending binge. The rush to make new loans is a direct response to the government's economic stimulus policy, which emphasizes infrastructure and internal development. The Chinese government was able to get its banks to open their lending windows when U.S. banks were being tight-fisted with their funds, because the government owns the banks. The Chinese banking system has been partially privatized, but the government is still the controlling shareholder of the Big Four commercial banks, which were split off from the People's Bank of China in the 1980s.
We might take a lesson from the Chinese and put our own banks to work for the people, rather than making the people work for the banks. We need to get our dollars out of Wall Street and back on Main Street, and we can do that only by breaking up Wall Street's out-of-control private banking monopoly and returning control over money and credit to the people themselves.
We could also take a lesson from the Chinese and dispose of our debt with a little creative accounting: when the bonds come due, we could pay them with dollars issued by the Treasury, in the same way that the Federal Reserve has issued Federal Reserve Notes to save Wall Street with its “Quantitative Easing” program. The mechanics of that process were revealed in a remarkable segment on National Public Radio on August 26, 2010, describing how a team of Fed employees bought $1.25 trillion in mortgage bonds beginning in late 2008. According to NPR:
Prof. Kaoru Yamaguchi showed with sophisticated mathematical models that paying off the federal debt with debt-free Treasury notes would have a beneficial stimulatory effect on the economy without inflating prices.
If the Fed can do it to save the banks, the Treasury can do it to save the taxpayers. In a paper presented at the American Monetary Institute in September 2010, Prof. Kaoru Yamaguchi showed with sophisticated mathematical models that if done right, paying off the federal debt with debt-free Treasury notes would have a beneficial stimulatory effect on the economy without inflating prices.
[W]e have turned our backs on the principles that made us great. But those principles are not rooted in “fiscal austerity.”
The CAGW ad is correct: we have turned our backs on the principles that made us great. But those principles are not rooted in “fiscal austerity.” The abundance that made the American colonies great stemmed from a monetary system in which the government had the power to issue its own money - unlike today, when the only money the government issues are coins. Dollar bills are issued by the Federal Reserve, a privately owned central bank; and the government has to borrow them like everyone else. But as Thomas Edison famously said:
China's government can direct its banks to advance credit in the national currency as needed, because it owns the banks. Ironically, the Chinese evidently got that idea from us. Sun Yat-sen was a great admirer of Abraham Lincoln, who avoided a crippling national debt by issuing debt-free Treasury notes during the Civil War; and Lincoln was following the lead of the American colonists, our forebears. We need to reclaim our sovereign right to fund the common wealth without getting entangled in debt to foreign creditors, through the use of our own government-issued currency and publicly-owned banks.
Ellen Brown is an attorney and the author of eleven books. In Web of Debt: The Shocking Truth About Our Money System and How We Can Break Free, she shows how the Federal Reserve and "the money trust" have usurped the power to create money from the people themselves, and how we the people can get it back. Her websites are webofdebt.com, ellenbrown.com, and public-banking.com.
Ms. Brown's stories are republished in the Baltimore Chronicle with permission of the author.
Copyright © 2010 The Baltimore News Network. All rights reserved.
Republication or redistribution of Baltimore Chronicle content is expressly prohibited without their prior written consent.
Baltimore News Network, Inc., sponsor of this web site, is a nonprofit organization and does not make political endorsements. The opinions expressed in stories posted on this web site are the authors' own.This story was published on October 30, 2010.