Dr. Rasmus dissects the just announced signing of the US-China Phase 1 trade deal. Trump claims of achievements are debunked and revealed as mostly smoke and mirrors. Trade terms claimed by Trump, and analyzed by Rasmus, include: majority ownership by US companies in China, ending China’s manipulation of its currency, gains in IP and Tech transfer limits on China, the claim of $100B more a year purchases of US farm goods by China, and another $100B in purchases of manufacturing and services by China. What’s fact and what’s Trump fiction in these areas? Rasmus agrees with the Council on Foreign Relations conclusion that China has only restored agriculture purchases and provide “nice words on IP” and that Trump got what he could have had two years ago! Rasmus explains what’s coming (and not coming) next in Phase 2; why Trump’s trade war(s) are over; why the US-China tech war will now escalate; and what’s behind Trump still keeping $370B in tariffs. The costs of the China-US trade war are described, including the facts about the trade deficit effects, costs to US businesses, impact continuing on the US farm sector, the average hit to consumers of $806 from rising prices, impacts on US business investment contraction, and global investment and GDP, and absurd claims by Trump’s administration (Kudlow and Mnuchin) of the impact on US GDP growth. (Next week show: ‘The 10 Most Important Economic and Political Events of the past decade, 2010-19)
Dr. Rasmus provides an analysis of the events of the past week involving Trump’s ordered assassination of Iran’s general, Soleimani, and how it represents the way the USA typically precipitates military confrontation that often lead to war. (Read Rasmus’s article, Trump’s Déjà vu Wartime Playbook and 2 other articles posted on the blog, jackrasmus.com). How the US wartime playbook involves a definable pattern of provocations followed by issuing an unacceptable demand that often leads to military action—similar case examples from Vietnam to the 1st Gulf War to Afghanistan to the Iraq war and now being repeated in the Trump provocation (assassination) and eventual unacceptable demand aimed at Iran. In the second half of the show Dr. Rasmus follows up his last week discussion of the 10 most important US Economic events of 2019 with a discussion of the 10 most notable US political developments of 2019: the Trump v. Iran provocation set in motion in December 2019, Trump’s Impeachment; the Mueller Report; the growing US Constitutional crisis; Trump’s packing of federal courts; Neocons taking over US foreign policy; US ‘Red’ states continued anti-democracy drift expanding voter suppression and gerrymandering; US social-cultural decline (opioids deaths, suicides, gun deaths, record homeless, millions without health access, and household debt crisis); Trump’s ‘Space Force’; and the continued internal realignment of the Republican (now Trumpublican) and Democratic Parties.
Dr. Rasmus reviews the 10 most important economic events of 2019 in both the US and global economies. Topics include the Fed’s prior policy reversal and 2019 interest rate cuts, the Repo market crisis, Trump’s trade wars (phony and real including USMCA and China deals), the US 5 mo. manufacturing recession now worsening, the 9 mo. long contraction in US real investment, the stock market and bond boom of 2019 (and what’s driving it), Trump’s official budget deficit of >$1 trillion, Trump’s further tax cutting. US productivity slowdown, and US debt—public and private—now exceeding $60 trillion, with the consequences with the next recession. Globally, the top 10 events include: global trade stagnation, global manufacturing recession, central banks’ shift again to QE, global stock market boom, $15 trillion in negative interest rates, >$10 trillion in global non-performing bank loans, emergence of alternatives to the US dominated SWIFT international payments system, Latin American economies’ currency crises, growing financial instability in India, and China’s economy with slowing GDP, manufacturing, and rising debt and emerging defaults. (Next week: the Top 10 political developments of 2019 in the US and globally).
Dr. Rasmus summarizes the 12 key economic events of 2019: 1) Fed’s interest rate cuts and policy reversal, 2) Global Economy Trade stagnation, 3) Trump’s Trade Wars: China, USMCA & Phony All Other, 4) $Trillion Dollar US deficit and $23T US federal debt + >$1T deficits annually for another decade, 5) the Global Manufacturing Recession & economic slowdowns from Germany to Japan to Latin America to China-India, 6) the Repos market instability in US, 7) Challenges to the US ‘SWIFT” international money payments system by Instex, Libra, etc., 8) US & global stock markets’ record boom (US up 30%, others 20%). In Tech impacts on the US and global capitalist economy now emerging: 9) ‘Adversarial-Generative Neural Networks (AI)’ creation of fake voice + fake facial reproduction, 10) the Tech War between US and China, 11) Amazon’s ‘next day’ delivery effects on ground-air distribution companies, 12) development of hypersonic missiles/tactical nukes/US Space Force and the advent of less than one minute notice before world war III. ( In the last third of the show Dr. Rasmus welcomes guest Alan Benjamin to provide latest developments in the French strikes and the possible General Strike after January 2, 2020. (Next week: Dr. Rasmus summarizes 12 most important political events of 2019 + further interview of Benjamin on France’s looming General Strike).
For the past week a general strike has been happening in France, the focus of which is to protest and prevent President Macron from introducing an ‘American Model’ of retirement system that would raise retirement age and reduce pension retirement benefits. What’s the ‘American Model’? Dr. Rasmus provides a historical overview of that model, created in the late 1940s based on the so-called ‘triple stool’ of retirement: social security, defined benefit pension plans (DBPs), and personal savings. Each was supposed to provide one-third of income of a reasonable retirement. Rasmus explains the evolution of social security, DBPs, and savings since Reagan and how all three have been steadily undermined, reduced, or destroyed since the 1980s—replaced by 401ks, cash balance plans, raised retirement years, and privatization of pensions. Today more than half of workers have no savings whatsoever, 401ks provide less than $50k on average for the rest of lifetimes, and social security averages less than $1,200 a month. Retirees are forced to work until they drop now, the fastest growing segment of the US labor force as they return to part time employment. Tens of millions are now facing a retirement crisis of unimaginable dimensions. (Next week: a guest, Alan Benjamin, an eyewitness to the strike in progress, will describe what’s actually going on in the French strike to prevent the ‘Americanization’ of the retirement system in France).
Dr. Rasmus provides an update on the Brexit UK Parliamentary election vote yesterday and on Trump’s announcement to delay and reduce tariffs on China imports as part of the US-China phase 1 mini trade agreement. Why Boris Johnson and the Conservatives won an overwhelming victory and why Labour was trounced. What was the role of short term electoral strategies and tactics; and what was the longer run role of the rising tide of manipulated nationalist appeals and decline of Social Democracy. Plus, why Trump caved in to China’s demands and agreed to reduce tariffs in order to get an agreement before the December 15 deadline. Dr. Rasmus for the remaining 45 minutes of the show then welcomes Michael Albert, a well known progressive writer and advocate of socialism and participatory democracy in the workplace, to begin a discussion on what is this thing called Socialism and why now a majority of millennials in the US say they would prefer Socialism to the current form of US capitalism. Both Rasmus and Albert agree the importance why a vision of an alternative to capitalism is important, but perhaps disagree somewhat on the composition and elements emphasized in that alternative vision. (For more of Michael Albert’s view, check out his articles on the blog, ZNET, at zcomm.org).
Dr. Rasmus traces the decline of Democracy under Trump, a process on-going since the advent of Neoliberalism. Topics include: the transformation of the political parties, actions by the Supreme Court on behalf of money in politics, spread of gerrymandering and voter suppression, expansion of the lobbyist state, revolving doors, attacks on civil liberties and restrictions on bill of rights guarantees, etc. How decline of Democracy has accelerated since 2008 crisis and now under Trump. Examples of Trump attempts to usurp constitutional role of Congress and his trend to favor himself as above the law (e. g. tyranny). The linkages between Neoliberalism in crisis and decline of Democracy. In the second half of the show an interview and discussion is held with union and community leaders holding a conference in Cleveland on December 7 to plan the creation of a third political party as the solution to restore Democracy.
First half of today’s show reviews latest attacks on unions, in particular the ILWU longshore workers, and how Apple Corp. and other big companies CEOs and senior management ‘scam’ stock buybacks to enrich themselves directly from the buybacks. How Apple Board Directors like Al Gore make tens of millions of dollars a year from the buybacks scam. Rasmus then debunks the growing business-media spin that the US economy has ‘turned the corner’ and no recession is in view. How leading indicators, investment, manufacturing, jobs, and even early evidence of consumption indicate otherwise. The theme of Neoliberalism is revisited further once again, continuing recent weeks’ discussions. Why the Neoliberal policy mix (Fiscal-Monetary-Industrial-Trade) is becoming less and less effective due to maturing forces behind capitalist economic evolution. Rasmus explains how new technologies (power generation, electrical storage, artificial intelligence, machine learning. Uber and Amazon ‘effects’ and business models of the future, etc. are together undermining Neoliberal policy effectiveness and spell its doom next decade. (For a more detail treatment of the ‘natural restructuring of capitalist production, distribution, and finance’ now underway, threatening the future evolution of Neoliberal policy, read chapter 9 of Dr. Rasmus latest book, ‘The Scourge of Neoliberalism: US Economic Policy from Reagan to Trump’ available at discount from his blog, jackrasmus.com). Next week: How Neoliberalism Destroys US Democracy’.
The first part of today’s show reviews the latest developments in the US-China mini-trade deal negotiations and latest snapshot of US economic manufacturing, investment, and retail sales-consumption. Thereafter
Dr. Rasmus continues the analysis of Neoliberalism in crisis topic of last week, explaining how Obama failed to restore it to full effect in the wake of the 2008-09 crash and how Trump represents the attempt to restore it in a new, more virulent 2.0 form. The fundamental main policy propositions of Neoliberalism are restated and how Trump has fared to date in each area are addressed. Big success by Trump in restoration have occurred in business-investor tax cutting and increases in war-defense spending, but failure in social program spending cuts and containing escalating deficits and debt. Trump industrial policy has also been successful, with deepening of deregulation, privatization, continued wage compression, benefits cost reductions, and other areas. Neoliberal monetary policy of chronic low interest rates remains a work in progress as Trump fights the Fed over rate reduction but the Fed slowly falls in line. Neoliberal ‘External’ policy (trade, currency exchange rate, FDI money flows) represents Trump’s major failure at restoration, however, as the trade war produces little result and reduces investment and growth globally and increasingly as well in the US. (A more complete analysis is available in Dr. Rasmus’ just released book, ‘The Scourge of Neoliberalism: US Economic Policy from Reagan to Trump’ available on his blog, jackrasmus.com, along with recent articles on the topic). Next week: the material forces at work undermining a restoration of Neoliberalism under Trump and his successors.
In the second half hour of the show Dr. Rasmus continues the discussion of Neoliberalism, focusing on the internal contradictions inherent in its policy regime, now intensifying after the 2008-09 economic crisis. Rasmus explains the four policies of Neoliberalism—fiscal, monetary, external-trade, and industrial—and how they represent the post-1970s restructuring of the US and global capitalist economies. Earlier restructurings before world war I and following world war II are contracted to the 3rd, Neoliberal restructuring. Examples of contradictions within, and between, the four policy areas are explained: How fiscal war spending and tax cutting clashes with deficits/deb management; how monetary policy exacerbates trade and currency policies; how trade policies exacerbate industrial policy; how monetary policy contradicts both fiscal and trade policies. In the first half of the show, Rasmus provides updates and analyses on the tariff dispute between China-Trump, why US stock markets keep rising despite fundamentals, how Europe’s economy continues to stagnate, and new evidence how speculation is contributing to the instability in the US Repo market. (Next week: ‘Why Trump’s Attempt to Restore Neoliberalism 2.0 Is Failing’)
