Saturday, November 19, 2011

Peak Humanity Now Turning The Corner

Other day I was discussing prognoses including long term US outlooks from economists like *Nouriel Roubini, who is bullish long term on the US.

Basically these guys are suggesting we're going to see a return in "some manufacturing" thanks to wage deflation and mass flocking to the fallout shelter of the dollar (which is itself distorted with a quadrillion CDS short on the PM mirror image, and the biggest megabubble of all yet to blow). What are these awesome new jobs going to pay, exactly? If you simply shift an iPad suicide pit back to the US and stock it with illegals who currently do all our manual labor for couch change, or fill the jobs with Gulag or debt slaves instead of the Chinese ones, that may boost the GDP price propaganda ticker and provide economists with an employment number talking point, but it is a zero or negative-sum gain in terms of Gross National Happiness, which is the only metric that matters. The social contract built by the labor movement and securities act protections upon which the American middle class powerhouse was founded are being systematically rolled back, with JP Morgan's insider magazine stating (within their own banker chambers) that "US labor compensation is now at a 50-year low relative to both company sales and US GDP". Without the changes championed by the Occupy Movement, i.e. separation of corporation and state, they and their whores on capitol hill will continue the rolling back to late-19th century/Chinese levels of labor exploitation with destruction of bargaining rights, replacement of jobs with wetbacks and Big Prison slavery in turn driving down the bottom line, debt and inflationary wealth-stripping, and outright austerity bloodletting. Any of this anticipated growth will be negated if not strangled by these effects, just like GDP actually decreased in the noughties if you remove the debt portion falsely inflating the numbers. Roubini’s forecast also relies on the US congress and administration somehow turning around and magically “ending the kicking of the can”; something we’re promised on a near continual basis with no results.

As if our "representative" Obama -- whose campaign was bought and paid for by one of the all-time-largest contributions from the "Too Big To Fail" investment banks -- is actually involved in any of the decision making rather than being a speechifying celebutante, a piece of marketing bait to reel in Joe Hope-n-Change. Obama is the blue equivalent of George W Bush, ball gagged in the closet while Tim Geitner, Paul Rubin, the Clintons, and Bernanke go over with Dimon and Blankfein the “game plan”, including a) how they’re going to spin Wachovia’s 400 billion dollar money laundering of the mass-murdering Zeta drug cartel in the next news cycle b) Whether they should keep the Fed interest rate at 0% for the next 50 or 100 years in order to ensure that malignant speculation/looting has enough fuel to continue to suck the lifeblood out of the economy and debt serfs of the US lower 99% via that financial Apartheid c) Whether they should install Lucas Papademos, vice president of the European Central Bank, formerly of the Federal Reserve of Boston, as new Greek prime minister, to ensure that the Greek holocaust/bailout of their criminal bondholders goes as planned. D) Whether they should replace Berlusconi with Mario Monti, big wig executive at Goldman Sachs and “prestigious member” of the notorious MotU frat house - The Bilderberg Group, to make sure that coup-de-tat goes as planned and that they successfully plunder Italy's 3k tons of gold bullion. Yes, a literal coup, as neither of these banker-plants, of course, are elected heads of state. And as it stands there is absolutely nothing preventing the debt and fraud-based Ponzi from continuing its rampage as the "vampire squid" on the face of the 99% here in the US going forward, nothing to prevent the 2008 megabubble 2.0 from blowing again. Once again: zero major criminals indicted now taking even bigger risks, zombie investment banks even bigger to fail, continued money printing trending toward Weimarization, six hundred trillion outstanding dark pool derivatives weaponized by JP Morgan still distorting the gold and silver price to prop up the zombie dollar, regulators in bed with the regulated = no regulation, firms like MF Global headed by former Goldman Sachs exec just outright stealing billions of people's money with impunity, lawlessness and chaos prevails, wash rinse repeat. No amount of iPad 3s and penis pills are going to put a dent in that.

Yes, banksters. Close knit group of criminals operating beyond the law, who happen to be bankers. Financial mafia. Let's call a spade a spade, stop being schmucks, and not delude ourselves into believing these people are anything but lawbreaking barons who deserve to be dumped in a prison cell for life, or worse. Unless you get off on being the abused girlfriend who keeps crawling back in codependence to her beater with her misshapen cheekbones, telling yourself it's, "All my own fault," that, "He really means he's sorry this time." Like the Greek economists with Stockholm syndrome, trying to convince their population that the EFSF is their messiah who is trying to save them from their (fraudulently induced by Goldman Sachs in collusion with Papandreou) debt problems by beating them over the head with more debt, literally killing them with hospitals staffed by five nurses, suicide and drug use up 40%. Oh, but it's not people being photogenically mowed down with panzers, so it doesn't count. My bad. CNN, pack up your cameras, nothing to see here. I said pack them the fuck up. Cut to that airbrushed close up of Sarkozy or Merkel or some random CME trader staring up at stock tickers, holding his forehead concernedly. Headline: "Europe struggles to save Greece and Italy".

[QUOTE]Everybody saw the housing crash coming but nobody could do anything about it.[/QUOTE]

Or, nobody could do anything about it without getting their meal ticket pulled, because they're all bitches of the financial mobs.

[QUOTE]Retail vacancies are down but for needs based items, not luxury items, which points to a resurgence in capital flow but not wages. [/QUOTE]

Awesome, so Jamie Dimon, Jon Corzine, and all the insider-trading revolving door Democrats and Republicans are buying 50% more Valentino suits, Maseratis, and Kim Kardashian-sized diamond rings. That's great news. That is the light at the end of the tunnel right there.

[QUOTE]Although the US ALMOST defaulted on its debt this year that was due parliamentary BS, not an inability to pay.[/QUOTE]
This is besides the point that this debt is not sustainable, which is besides the point that we *are* "paying" at all for the toxic debt -- paying for the TREASONOUS illegally bestowed criminality of JP Morgan, Goldman Sachs, AIG, Wachovia, Citi Bank, Bank of America, and more with the continued support of the Obama administration -- and we are continuing to pay with this:

#1 The financial manager of the Detroit Public Schools, Robert Bobb, has submitted a proposal to close half of all the schools in the city. His plan envisions class sizes of up to 62 students in the remaining schools.

#2 Detroit Mayor Dave Bing wants to cut off 20 percent of the entire city from police and trash services in order to save money.

#3 Things are so tight in California that Governor Jerry Brown is requiring approximately 48,000 state workers to turn in their government-paid cell phones by June 1st.

#4 New York Governor Andrew Cuomo is proposing to completely eliminate 20 percent of state agencies.

#5 New York City Mayor Michael Bloomberg has closed 20 fire departments at night and is proposing layoffs in every single city agency.

#6 In the state of Illinois, lawmakers recently pushed through a 66 percent increase in the personal income tax rate.

#7 The town of Prichard, Alabama came up with a unique way to battle their budget woes recently. They simply stopped sending out pension checks to retired workers. Of course this is a violation of state law, but town officials insist that they just do not have the money.

#8 New Jersey Governor Chris Christie recently purposely skipped a scheduled 3.1 billion dollar payment to that state's pension system.

#9 The state of New Jersey is in such bad shape that they still are facing a $10 billion budget deficit for this year even after cutting a billion dollars from the education budget and laying off thousands of teachers.

#10 Due to a very serious budget shortfall, the city of Newark, New Jersey recently made very significant cuts to the police force. Subsequently, there has been a very substantial spike in the crime rate.

#11 The city of Camden, New Jersey is "the second most dangerous city in America", but because of a huge budget shortfall they recently felt forced to lay off half of the city police force.

#12 Philadelphia, Baltimore and Sacramento have all instituted "rolling brownouts" during which various city fire stations are shut down on a rotating basis.

#13 In Georgia, the county of Clayton recently eliminated its entire public bus system in order to save 8 million dollars.

#14 Oakland, California Police Chief Anthony Batts has announced that due to severe budget cuts there are a number of crimes that his department will simply not be able to respond to any longer. The crimes that the Oakland police will no longer be responding to include grand theft, burglary, car wrecks, identity theft and vandalism.

#15 In Connecticut, the governor is asking state legislators to approve the biggest tax increase that the state has seen in two decades.

#16 All across the United States, conditions at many state parks, recreation areas and historic sites are deplorable at best. Some states have backlogs of repair projects that are now over a billion dollars long. The following is a quote from a recent MSNBC article about these project backlogs....
[QUOTE] More than a dozen states estimate that their backlogs are at least $100 million. Massachusetts and New York's are at least $1 billion. Hawaii officials called park conditions "deplorable" in a December report asking for $50 million per year for five years to tackle a $240 million backlog that covers parks, trails and harbors.[/QUOTE]

#17 The state of Arizona recently announced that it has decided to stop paying for many types of organ transplants for people enrolled in its Medicaid program.

#18 Not only that, but Arizona is so desperate for money that they have even sold off the state capitol building, the state supreme court building and the legislative chambers.

#19 All over the nation, asphalt roads are actually being ground up and are being replaced with gravel because it is cheaper to maintain. The state of South Dakota has transformed over 100 miles of asphalt road into gravel over the past year, and 38 out of the 83 counties in the state of Michigan have transformed at least some of their asphalt roads into gravel roads.

#20 The state of Illinois is such a financial disaster zone that it is hard to even describe. According to 60 Minutes, the state of Illinois is six months behind on their bill payments. 60 Minutes correspondent Steve Croft asked Illinois state Comptroller Dan Hynes how many people and organizations are waiting to be paid by the state, and this is how Hynes responded....

[QUOTE]"It's fair to say that there are tens of thousands if not hundreds of thousands of people waiting to be paid by the state."[/QUOTE]

Forget the elephant in the room that all these economic gurus hand-wave away: breakthroughs in robotic automation and artificial intelligence are replacing human manufacturing and even highly-skilled jobs en-masse. US electronics manufacturers are almost entirely automated with human workers filling in as a scant few troubleshooters who tweak a solder algo by a micron or tweak a buggy snaggle of code occasionally. Just look at videos of IBM circuit printing factories. Who is going to hire human workers who need wages, who get sick, who require sleep, who have kids, who are generally unreliable? Manufacturing output in the US may continue to increase but will definitely continue to decouple from job and wage growth. The "inshoring" is going to come back but it's Watson and Wall-E and Hal that are going to be seeing all that "prosperity", performing routine diagnoses, checking out your groceries as autoclerks, replacing vast swaths of the ‘white collar’ office jobs with brute-force data-modelling AI and evolutionary algorithm-based intelligence that can now automatically generate sports commentary and even formulate scientific theories. It's the 1% owners of the non-human means of production that are going to be reeling in all the fruits of the new US Golden Age in the form of increased profit margins, while the rest of the population are out getting bloodied by specuflation, non-regulation, worker oppression and austerity that’s eviscerated the safety nets when they most need it, eaten alive by zombie banks.

The usual “Jobs will come from somewhere” counterargument assumes that there is a “where” sizable enough within the mental and physical capabilities of the human species to replace the obsolesced sector of jobs. While there may be an unending litany of new products to come out (next season’s iPhone, a better electric car, some other as yet uninvented tech), there is not an unending litany of new human physical and mental abilities being pumped out every season by Darwinian evolution of our neocortices. What we’ve got is what we’ve got; the human body and mind are a finite resource and we are rapidly approaching peak humanity. The Luddites who were yanked during the Industrial Revolution by the loom (and not without violent and vehement protest) and the assembly line workers who were supplanted by the first semi-autonomous machines were both engaged in jobs on the very lowest tier of human capability — that is, simple, repetitive, mechanical tasks. These are the very easiest of automatable tasks in the design space of machines; they are essentially a three line algorithm: “push, screw, repeat”. All these traditional examples often mentioned by economists – looms, farming equipment, information technology -- have been replacement by machines of small slices of human potential. Physical manipulation of car parts replaced by servos and actuators, memory and numerical calculation replaced by bytes and Turing machines -- these have all been absorbable as new “oil wells” of human potential were there to be tapped into and utilized. Rote mechanical and mental work was replaced by slightly higher service industry and knowledge work skills, but the difference in the coming AI/robotics revolution is that we’re going to run out of “wells” of potential to tap. And even the automation thus far has proven to have massive destabilizing effects on society as a whole.

As computer automation of the mid-skill and knowledge work begins to really set in, more and more people are going to be squeezed out of the workforce, with limited human-employability pie. The for-profit college loan ponzi-scheme scams are a symptom of this: you need a four year degree to even start competing for jobs that pay anything livable, and yet even with these degrees, almost half of the new college graduates leave school without a job, and almost a quarter are unable to find any decent job at all, let alone in their field. Indeed that great wave of “economic growth” we’ve been riding for the past decades has been art dropout brand-pushing AKA marketing — a zero-sum non-wealth-creating tug of war over customers — and the best and brightest gold star kids going for that MBA to engage in plutocratic wealth-stealing schemes consisting of sandcastles of financial paper shuffling built on clouds of shadow mark-to-model systems. Culminating spectacularly in the recent global financial meltdown, and continued shambling of the undead financial system which still brutalizes the world. And this monstrosity, coincidentally, was in part enabled by automation of the stock market via algorithmic and high-freq trading, obsolescing another swath of the formerly human field of “systems analysts” the star children of the Astounding Economy of The Future born from the ugly post-Fordist nebula of Reagonomics in the 80′s and 90′s. Now even those hotshots are going the way of John Henry, leaving only the mogul-class. Here's a prognosis: fifty percent unemployment, constant and growing global mass protest, World Class Warfare turning hot, de-facto rule by existing wealth, white tuxedos perched in two hundred story bullet-proof glass pyramids guarded by autonomous Reaper drones and Terminators armed with sound cannons, who hire the spineless and the foolish to office to do their bidding. Cacastocracy: rule by the stupidest and least qualified.

What we're looking at, long term, is precisely the opposite of a positive outlook, but rather mass inequality, un/underemployment. Thus, more Occupy-like movement and growth of alternate economies, alternate societies, and alternate politics. Direct democracy. The shadow economy is already the fastest growing sector at nearly ten trillion. Barter, Craigslist, self-fabrication, the open source village, farmers markets and bazaars in parking lots, resilience communities. Self-starting communities that aren't waiting for governments to save them, for jobs created by the cartel to return (both are vanishingly improbable). And many people are straddling both worlds: working a declining, "precariat" job at a post office with hours shriveling while simultaneously patching the income with a home-fab or farm swapmeet biz. At the local Occupy, we've got nurses working *full time* yet are uninsured, who are directly providing medical assistance to one another. Already, studies are showing half the workers of the world -- close to 1.8 billion people -- are working in what's called System D: off the books, in jobs that were neither registered nor regulated, getting paid in cash (and now silver and gold as the fiat fiasco winds down). In one sense, Occupy is simply the extension of the shadow economy: it is self-starting shadow-politics circumventing the formal mechanisms of power. Not revolution but exolution, exodus from the shackles of the broken republic turned corporation-state cabal. If it were a country, System D would be surpassed in GDP only by the US and China. I'm forecasting a bull market for gold, silver, and pitchforks. The decade for guillotines.

Obviously at present the Homo Sapiens overhead for the operation of an (at present) bleeding edge tech like a Reaper drone is substantial. Does that mean it always will be? At one time it took hundreds of technicians paid thick company salaries laboring over hundreds of miles of wire, vacuum tube and punch cards just to do a simple arithmetic calculation. All jobs which were created by the advent of the electronic computer. Now four year old South African kids fresh out of the !Kung hunter-gatherer dreamtime can do billions of such calculations a second on $10 cell phones 1/1000,000 the size of an IBM 701 with the push of a button. At least while they’re not being starved to death by the million as a byproduct of Goldman Sach’s manufactured commodity bubbles and distortions tripling the price of basic staple foods like corn and wheat. Collateralized debt conflagration. Incidentally, the artificial famines created by nanosecond speed algorithmatized trading is also wrought at the push of a few buttons which used to require 'scraper-filling hordes of traders and analysts, many of whom are actually out there in the Occupy Movement now .

*Ultimately I agree with the majority of Rounbini's analysis, but I think he's leaving some of the possible black or grey swans out of his equation.

Sure, an assembly line of robots can make cars now, but someone has to install the robots, and program them and configure them and all of that back end requires technicians.

Problem, which I already pointed out, and which you obviously have failed to grasp, is that the rate of technological job creation and technological job destruction are decoupling and the spread will only continue to get worse as the window of un-automatable human physical and cognitive capacity draws thinner. The number of “technicians” required is over the long outlook negative-sum, constantly decreasing, as in the electronics factories, which can match Shenzhen’s dollar-a-day slave labor by eliminating the majority of the factory’s manual chip soldering, etc. with robots. U.S. manufacturers have cut nearly 5 million manufacturing jobs (about 33%) since 2001 yet the value of manufactured goods rose 27 percent, and U.S. exports reached their highest level in 20 years. In fact it’s just come to light that global electronics manufacturer Foxconn “plans to replace many of its factory workers in China with a million new robots.” So much for that competitive advantage.

When tractors, crop-pickers and other farming machinery displaced half the country from agricultural jobs, the former farmers were able to find new jobs migrating to factories. But what happens to the hundreds of millions of white collar workers when artificial intelligence begins evicting them from their offices? Where do they go? Their situation is far worse than the factory workers or farmers a century ago because a) Software automation is magnitudes cheaper and easier to implement than a large roboticized factory with a huge infrastructure overhead. Software can be replicated nigh infinitely with minimal additional cost. b) White collar jobs are far more costly to employers than blue collar, all the more reason to “right-size” them away c) The automation of a knowledge worker job kills the “machine as tool” Luddite-fallacy argument because it no longer requires a human “operating” each individual instance of the intelligent machine. What happens when the capital itself becomes the labor?

Turbo Tax, for example, is a single software which eliminates millions of accounting gigs once enjoyed by people who spent years, in some cases decades, in higher education. But that’s old-hat. Document examination once done by armies of lawyers, can now be done by scanning technologies and smart algorithms that search case law, evaluate, and present summaries. They can do this at a fraction of the cost and with far greater thoroughness than their human counterparts. Where do the millions of displaced legal workers go? Um, uh, hm.

With Watson and similar mass-data modeling AI, the majority of office workers, management and even executive work of decision making, resource allocation etc. can be replaced, and with more efficient results. Wal-Mart already has the drop on this and have made bank, others are starting to follow suit. The latest in automated pattern-recognition technology can now perform the work of scanning tumor slides and other x-rays normally done by radiologists paid $300,000 a year after 13 years of school – at one hundredth the cost. Where are the millions of new jobs going to come from to replace these?

Then there are the self driving cars, which now have eaten over a hundred thousand miles of public road and are being slowly rolled out by Google among others. Just last week the world's second-largest iron ore miner Rio Tinto PLC said it would up its fleet of driverless trucks from 10 to 150 in order to boost profit margins in Australia. There are 3.2 million truck and driver/sales jobs in the US at present. Then you’ve got the millions of bus drivers, taxi drivers, mail carriers and more who will be down at the unemployment office (picked clean thanks to bailout-austerity) when that a-bomb of job destruction hits the market.

And these are all technologies already [i]in existence[/i], not counting those yet to be invented. Many jobs are safe from automation for now not because they are incredibly complex or mentally demanding, but because they require a high degree of dexterity, visual acuity, and coordination which have been traditionally difficult for machines. But I wouldn’t stay long that trend if I were you. Already ASIMO II is capable of navigating complex and changing environments, locating and manipulating objects with near-human haptic skill, recognizing faces, detecting speech from a single voice among multiple simultaneous speakers. It’s not such a big stretch to imagine a store fully automated by a central inventory/managerial AI directing ASSIMO shelf stockers and warehouse workers supplied by self-driving trucks. Sure, those hellfire missile-handlers have their hands full now, those sensor operators have their job security for the moment, but for how long? We’ve already got autonomously navigating military vehicles like the Squad Mission Support System . The idea that all the jobs enlisting human potential not emulatable by machines at present are somehow always going to be around or that obsolesced positions will always be replaced with new ones is simply myopic. Call it “logarithmic dross”.

Two-and-a-half years after the Great Recession officially ended, unemployment has remained above 9% in America. That is only one percentage point better than the country’s joblessness three years ago at the depths of the recession. How is this possible? Since the end of the recession, corporate spending on equipment and software has increased by 26 percent, while payrolls have been flat. At the same time, the S&P 500 companies are expected to report record breaking profits this year to the tune of about $930 billion. This is just the beginning of technological disemployment/employment dislocating.

And we’re actually already in a far deeper hole than we think, the true job losses are not yet priced in. Given that the financial sector composed 41% of GDP at the peak of the Global Ponzi crisis, most of that fraud-based paper shuffling, and that we’re still playing kick-the-can and reward-the-TBTF, many of those “technician” jobs created by the malignant and illusory portions of the financial sector have yet to have their Wile-E-Coyote moment when they go the way of the elevator operator. And we don't need the full automation of every job, even 25% unemployment would have catastrophic effects in our current system. Add the fact that we need to create a net of over a million jobs just to keep up with [i]population growth[/i] and I’m still not seeing the bright long term outlook for the US.

Well, all right then. Since this will be your first armed insurrection, let me give you a few pro tips.

Of course, Einstein, because grabbing the AK and going full cowboy on a fucking 1st world government in 2011 is the smartest way to go about achieving positive change. Never mind the role of nonviolence in evicting the British from India or overthrowing the ruler of El Salvador in 1944, or even in ending Jim Crow in the United States and Apartheid in South Africa, in the popular removal of the ruler of the Philippines in 1986, in the largely nonviolent Iranian Revolution of 1979, in the dismantling of the Soviet Union in Poland, Lithuania, Latvia, Estonia, Czechoslovakia, and East Germany, in the resistance to a stolen election in the Ukraine in 2004-2005, in Egypt 2011, and in hundreds of other examples from around the world. Nevermind the fact that the target of greatest leverage here that won't result in futile bloodshed is manufactured ignorance and agnotological disinformation propagated through the traditional media channels that has us mindfucked into believing that everything is cool, that there is a vibrant middle class, that a rising DOW lifts all boat, that the failure of banks would be “catastrophic”, that there’s nothing to be done but take it up the ass or armed insurrect. Never mind that the goal was to shift the frame of the conversation away from the scripted sideshows on to what really matters and unites the 99% against the 1%. A goal which has been accomplished and has become larger than Occupy; an unevictable mindshift. As Edit pointed out, we may disagree about specific tactics, but the overall direction is there. But, hey, fuck the storyline, let’s fast forward to the Modern Warfare 3!

a href=>We are the 99% 33%.

Why? Because of violence.

If there is any encouraging news from this, it's that the decline in Occupy Wall Street's image is probably more connected to the increasingly negative coverage of the clashes between protesters and police than it is to declining support for movement's message.

I guess I should’ve expected a “smart bomb first, ask questions later” cave man solution. Trained to see in blindered "insurgent-friendly" dichotomies. In these trying economic times, we’ve all got to protect our job security, after all. But even after years of sometimes blowing up innocent civilians in endless wars of convenience to fund the various machines of wealth extraction and monopoly maintenance, ultimately they still just use troops like 12-year-old Thai whores, gut their retirements, dump their ashes into landfills like rusted out tools, or send their IED-eviscerated remains home in a Dell computer box to stink up their spouse’s front porch. Inflation getting out of control? Drop demand by killing off some poor saps in a war! Works every time. Perhaps I should start Tweeting “Fuck Occupy!”, “Eat Cake, sergeant Thomas!”, “Obama is my hero!” so maybe Echelon version Facebook.0 will file my dossier in the “benign irritant” subfolder. Next to the PTSD shellshocked Vietnam and Iraq vets that rot to death in the streets, left with only a cardboard sign for food and a purple heart to use as toilet paper, dry their tears on the colder nights when the bottle is empty and the forgetting is hard. Then when the few with limbs left show up, terminally jobless, pension/benefits slashed, at an Occupy chapter, they get a swift rubber bullet to the temple, followed by a flash-bang-to-the-ear chaser. Serves them right! Should've started an armed insurrection and opened fire on the riot cops. Yeah, fuck those stupid lazy-ass triple-tour marines! They’re so fuckin’ lazy. Here, have a McDonald’s application, you lazy fucks!

(Aside: We have a veterans workgroup, who are some of the most vehement about maintaining non-violence.)

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