Turning The US Into Pre-Bismark Germany

July 31, 2008

Elaine Meinel Supkis

Bush wants to privatize as many of the public freeways as possible. The theft of these expensive road systems is just one step in the process of selling off all our public holdings to foreign powers in order to pay our many bills. I harp on this a lot because the theft of much of this nation is treason. And it is treason to run trade and budget deficits and then capitalize foreign powers and in turn, sell us to them. There are many reasons why I totally oppose this process. Also, we visit history here in Berlin, NY. We had one of the earliest 'plank' toll roads in Ameirca 150 years ago.

Toll Nation

The Bush administration unveiled a plan to impose new tolls on freeways and encourage more private investment to finance road and mass-transit projects, a move aimed at stirring debate as lawmakers prepare for a major overhaul of transportation policy.

The White House says more tolls and public-private partnerships can solve perhaps the biggest problem confronting the nation's aging infrastructure: There are limited funds available to upgrade transportation networks and too many federal funds are doled out inefficiently through earmarks and pet projects that do little to improve mobility or reduce congestion.

The search for alternative funding sources is ramping up because Americans are driving less and shifting to more fuel-efficient vehicles. That means they will be paying less in gasoline and diesel-fuel taxes, which traditionally have been the biggest source of federal funding for highway and mass-transit construction.
*snip*
Ms. Peters says gas-tax rates should hold steady -- at 18.4 cents a gallon for regular gasoline and 24.4 cents a gallon for diesel, where they have stood for more than a decade -- and private money and toll revenue can address any needed increases in funding. She declined Tuesday to say how much more the U.S. needs to increase its overall spending on transportation infrastructure. Instead, she suggested ways to make transportation spending less wasteful.

Even today, Americans want to reduce the gas tax to zero. It was supported by Hillary Clinton and John McCain as a neat, easy trick to reduce gas prices. Now, we see the US President suggesting the taxes are not enough! So he wants to steal all the roads and hand them off to hostile aliens who have one goal only: to maximize profits off of the movement of citizens and goods within the US. Then our dollars will flow like crazy to Europe and Asia, enriching them. If this captive money flows to US thieves, they will not want it taxed and will ship the loot to the Cayman Islands.

The entire concept of public support of public facilities is collapsing as our government heads to bankruptcy. If the government outsources, offshores and privatize everything, only people with money will be able to use what used to be public facilities. All the rest will be shoved aside. Traffic that once flowed on freeways will shift to slower community roads still maintained by the public. The destruction this will cause will bankrupt local communities and they, in turn, will be forced to privatize roads! Soon, the entire US will be 'toll only' and this will be the end of any pretense of being a united states and we will reproduce Germany circa 1848. The great patriot, Bismark, set out to ruthlessly eliminate tolls. He used both diplomacy, arm twisting and outright violence to do this. In the end, he got his 'Tollverein'. Instantly, capitalism in Germany took off!

Why is that, we ask? And why was one of the earliest national freeway systems also built in Germany? The free movement of goods and trade is the cornerstone of the Free Trade New World Order people. Yet at the same time they decry barriers and tariffs across the planet, these very same clowns are pushing us to put up endless barriers and tolls INTERNALLY! Eh? What about that?

Instead of imposing a profit tax on oil companies during the run up in commodities markets, the US is planning to squeeze us all by means of demanding a daily road tax instead! This is extremely retro and I would suggest, it is designed to weaken the unity of America. When we cross borders from one state to another, they will all impose tolls and fines to fund their budgets.

This is so infuriating! The entire point of tolls and barriers is to protect domestic markets! And fund governments! We denied this and undid this vis a vis the rest of the planet which promptly took advantage of this and flooded us with easy credit and surplus trade goods, destroying our own economic base! And now, we are going to do to OURSELVES what we should have done to ALIENS! The aliens get free trade and we get tolls, barriers and tariffs....HERE AT HOME!!!!!

Europeans and Asians are buying up our infrastructure. They are not doing this for charity. An easy way to make money is to charge tolls, tariffs and fees. This is why our Constitution talks about how CONGRESS sets these things, not individual states. The earlier, Confederation was a total failure due to the various states immediately setting up fees, tariffs and tolls against EACH OTHER.

Little progress made in bridge repairs across US

(AP) -- A year after the worst U.S. bridge collapse in a generation brought calls for immediate repairs to other spans, two of every three of the busiest problem bridges in each state -- carrying nearly 40 million vehicles a day -- have had no work beyond regular maintenance.

An Associated Press review of repairs on each state's 20 most-traveled bridges with structural deficiencies found just 12 percent have been fixed. In most states, the most common approach was to plan for repairs later rather than fix problems now.

Even with tragedy facing us, even as we see on TV people dying because our infrastructure is falling apart, NOTHING is done. Congress voted over and over and over again to build bridges in Iraq and Afghanistan. Bush and Congress just opened the door to infinite spending on AIDs medicines in countries that don't practice safe sex. Israel got its piece of pizza pie doubled in size this year and nary a peep from the free spending traitors in Congress. Everyone overseas who wanted money, got money. Allies, former Soviet satellites, the rulers of a billion Muslims, all got more money. And meanwhile, the US falls apart. This is TREASON. Pretending all this protects America is a charade. In NY, NJ and Conn, most of the bridges and tunnels are toll roads. This creates pollution and other problems at the entrances to these toll booths.

Indeed, so much money was made this way, the Port Authority built these buildings called The World Trade Center. But the guys collecting tolls in the future will be building this stuff in their homelands, not here. Think of the money that pours in! It is huge.

I like to use my local situation to explain global economics. Berlin has been nearly totally destroyed by Free Trade. It is greatly reduced since Ronald Reagan's rule. Most voters here were Republicans and got what they voted for. Not that anyone in power today is against reaming out localities of all business opportunities. In the case of toll roads, Berlin had one of the earliest plank toll roads in America. We still call this road, 'Plank Road.' It runs right past my farm and over the mountains to Massachusetts.

Plank Road Fever in Antebellum America: New York State Origins
Daniel B. Kein
John Majewski

Plank roads burst upon New York and the nation as the solution to these problems--wooden roads that formed a hard flat surface upon which wagons could rollunhindered, with tittle discomfort to man or beast.
3
The technique seems to have originated in Russia and was introduced into Canada around 1840.4 Not surprisingly, news of the wooden roads drifted across the border into New York State. The story of plank roads in the United States thus begins in Salina, New York, a village near Syracuse, where in 1844 a group of towns- men formed a committee and obtained a charter from the state legislature to build a road from Salina to the nearby village of Central Square. Like many communities scattered throughout New York, the village wanted better access to canals and railroads. The committeemen
had heard of the Canadian plank roads but knew nothing of their construction. One of their number, a civil engineer named George Geddes, became intrigued by the notion of wooden roads and made two trips to Toronto to investigate the procedure.
*snip*s
The road’s success prompted one writer to proclaim that "The road has fully and completely succeeded.... The revenue justifies the prediction which was made by its builder."’9 By 1847, the New York State legislature had received so many petitions for plank road charters that it passed a general incorporation law. The law opened the floodgates, as more than 340 New York plank road companies received charters between 1847 and 1854.

I can understand why this was attempted. The Northeast has lots of hardwood trees. The new water-driven mills began to turn out a huge number of board feet of wood that was planked instead of using axes to chop beams into shapes as was done for thousands of years. In springtime, far from rejoicing in the warm weather, we have 'mud season.' I am very familiar with this since I live on a dirt road! The ground is frozen down at least 3-4 feet. The top layer melts but the lower layers don't melt for at least several weeks! So the water doesn't go down into the water table, it stays firmly at the top layer. This, in turn, becomes very muddy. VERY muddy. Driving any vehicles or walking or riding on this muddy slick that is above a frost layer is extremely messy. When it melts lower down, the mud gets WORSE. At the bottom of my driveway, for example, it can literally hip-deep in sticky, oozing mud.

Here is a picture of the tiny town of Berlin showing where east/west Plank Road crosses north/south Rt.22 which was a 'turnpike' 200 years ago.

The road goes very steeply up this ridge! It is famously steep. I once drove a 4 wheel car that went out of control on ice on that road and crashed. It is scary! A gas truck lost its brakes 50 years ago on this very same steep road and wiped out part of the village and killed a number of people, the destruction of that is right about where my camera was aiming.

So, during the early colonial years, all commerce ground literally to a halt as the rivers were dangerous, too, with all the ice floes as well as spring flooding and the insidious mud everywhere. From mid-March to mid-April, everything is filthy and slow. Then, in less than a week, all dries out once the last layer of ice melts deep down below! This is when I do all my road work.

So when the proposal to build toll plank roads was attempted, it was very popular. But not with everyone!

History of Plank Roads:

Experience proved Geddes wrong. Planks lasted four or five years, not eight, whether the roads were lightly or heavily travelled. What is more, after the planks began to deteriorate the roads became very hazardous: wagon wheels and the slender legs of horses would sometimes slip through the planking, with ruinous results. Much of Geddes’s mistake stemmed from the poor quality of the Canadian data. The Canadian plank roads had been built by the government, but the right to collect tolls had been auctioned to private parties. The result was disorganized information about revenue, maintenance costs, and ultimately about profits.

HAHAHA, the Crown built the roads in Canada and then used them as political leverage! In chaos comes profits. Everyone at the top knows this. In Berlin, the road from Troy, NY to Williams Town at the next state over. Today, the road is abandoned just 6 miles beyond my farm. My farm had trouble after the new toll road was built. The poor farmers who were living hand to mouth on this road all had to move or leave because they couldn't afford to go to and from the village of Berlin. Despite the lack of mud season closing roads, the farmers were in difficulties due to this newfangled road. Everyone was very much happier when the toll road was removed. I am happy I don't have to pay a toll every time I go to the post office or the store! This is why we should all be happy to not have tolls everywhere.

Bush signs housing bill in private

But Bush initially vowed to veto the bill as being overly socialistic. He finally dropped his objection when he decided that it was better than nothing. In a rare split, House Republicans opposed the bill and business interests like home builders and bankers favored it.

The White House had said there would be no bill-signing event, with one administration official noting ruefully that they had no desire to trumpet the accomplishment of the committee chairmen, Sen. Chris Dodd (D-Conn.) and Rep. Barney Frank (D-Mass.).

The houses being 'saved' are in the same category as toll roads: the 'owners' will own NOTHING. The value of future profits will go to investors who are being saved by the government! So they get their money from the government and then the government will engineer it so house values rise since it, not the home owners will profit from all this. Ack. It will not work. It can't possibly work. I see no way of it working. Turning our nation into tenants and toll payers is stupid, stupid, stupid.

The 19th Century Anti-rent Riots in NY:

Land history in New York State differed in pattern from most other sections of the colonies because of the Dutch influence. As the patroonship system evolved over the decades, parts of the manor were sold to small farmers. These manors, along with millions of acres confiscated by New York after the American Revolution, were sold to speculators.

A system of leasing which had existed since he middle of the 17th century allowed a freeholder to buy land from the lord of the manor with little or no down payment. For several years, no rent was expected, but after that period the leaseholder was expected to pay the lord part of his produce as rent. In addition, certain feudal customs prevailed, such as being required to work for the owner and clear his acreage. The owner's permission was even required if the tenant wished to entertain guests. Upon the sale of such land, the lord received a percentage -- usually 25 or 30 per cent -- of the proceeds.

Conditions were difficult for many farmers who, particularly on the Rensselaer manor, fell into debt. After the death of Stephen Van Rensselaer in 1839,a significant change occurred. The sons, unlike their benevolent and charitable father, demanded of the freeholders all back rent and other obligations not adhered to previously. When attempts were made to collect the back rents, riots began.

Armed conflicts raged throughout Albany County, spreading to the Mohawk and Delaware valleys. Farmers ignored writs of ejection issued as a result of their refusal to pay the rent. Local authorities attempted to enforce the writs, but were resisted and harassed by farmers, who sometimes disguised themselves as Indians. Governor Seward, although sympathetic to the farmers' plight, was compelled to back up the law enforcement agencies. In Delaware County conditions reached the stage of anarchy, requiring the governor to declare a state of insurrection.

Physical force was not the only form of resistance that occurred. Associations and societies were formed by the tenant farmers, and conventions were held in Berne, New York, the unofficial capital of the anti-rent movement. As the protest gained momentum , it attracted national land reformers whose philosophy extended beyond local problems. Dealing with these problems in more universal terms, they espoused the concept that all have a right to the earth and all land monopoly should be abolished.

A man's home is no longer his castle. Nor is a lady's home her castle. 30% of homeowners in America own free and clear. But this means, if we add the tenants and the deep-in-debt crew, they are a very small minority. And so appeasing the majority of non-owners means all sorts of crummy, stupid things will be launched. Passing the buck always ends up with the populace either living in increasingly third world status with nothing fixed, everything broken or paying tolls or private schools, etc. More about that later, I have a lot of experience with having to pay for tolls and schools! Out of my own pocket.

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Comments

[milo]

AGAIN YOU VOICE A TRUTH THAT INFURIATES...SELLING OFF THE ROADS IS THAT INSANITY AND BOUND TO HAPPENJ

[Christian W]

In a mirror move Republicans wanted to create tolls on the internet in 2006. Bloggers are hated now by the establishment, they noticed bloggers are capable of providing free speech and indpendent thought to a large part of the population, so it would not surprise me if the establishment will eventually find a way to limit the internet.

[GK]

Wow, more parallels to Weimar Germany as the FDIC GETS ACCESS TO FED WINDOW!

http://theautomaticearth.blogspot.com/2008/07/ debt-rattle-july-31-2008-oh-boy-oh-boy.html

Fire up the printers boys!

[Elaine Meinel Supkis]

Thanks, GK. Hard to keep up with the crap.

[calvino]

Too late. There go the airports.

http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=109&STORY=/www/story/04-19-2007/0004568876&EDATE=

And there go Indiana Highways.

http://www.slate.com/id/2138950/

[PJSV]

Elaine, I told you about PPPs/infraestructure privatization.

As we have here in Portugal, you gonna be flooded by PPPs. It's the only way that foreigners accept to put more money inside US.

Portugal has 3,2% of european high-ways but only represents 1,4% of european GDP. Our government says that we need a new airport in Lisbon, when the current one has enought free space to expand and aviation business is contracting. Our prime-minister, Socrates, also wants to build high-speed rail-ways when we already have fairly good system between Oporto and Lisbon, the 2 main cities. You know, our government has a lot of «connections» with the PPP lobby... Here in Portugal Blogs has been the main factor against this massive projects that will increase our debts at expense of future generations. Our Media is silent and our oposition leaders also approve this projects...

The US situation it's very similar to ours: You have the Israel-mainstreamedia-financial-militar complex that buys the politicians from both parties. We have the PPP-complex.

I think you can also forecast US future looking to portuguese economy.

By the way, as you can see here, our main PPP company Brisa, has already started to invest in US: http://www.tollroadsnews.com/node/3263.

But, anyway, Brisa last quarter results has been bad. Easy credit for PPP is vanashing...

[Elaine Meinel Supkis]

Massive public projects make everyone happy. Then selling these things off at a huge discount to private people is a big money maker for a host of drones and gnomes.

But the differential ends up on the tax rolls. As this accumulates, the overhead destroys the GDP of the entire economy and then everyone goes bust.

This is why any nation running in the red CANNOT report a positive GDP.

[calvino]

A nation run by Goldman Sachs can report anything it wants. Nikita Kruschev reported huge milk surpluses, saying that they would drown the US in milk. Just like we are drowning everyone in jobs now. The Bureau of Labor Statistics reports fiction, and Goldman Sachs backs up whatever fiction is convenient with their Treasury trading accounts. This is a casino, and when the house is losing, they just bring another shoe and hold your chips.

[blues]

(X-Posted @ Wild Wild Left)

Sometimes I ask people troubling questions. Your average person doesn't do this, at least not where I come from (Connecticut). But I am not at all one-sided about this; I ask myself troubling questions even more often. Would you like an example of (what should be) a slightly troubling question? Okay. "Should people be allowed to sell themselves into slavery?" Most people would probably assume that since slavery was abolished in the Civil War, the issue is moot. WRONG!!! You thought that demon was safely locked away in it's little cage? You didn't see its tail curling around behind you? Fooled yet again? Americans are carefully trained to be fools, you know. Now, here's a little "test." Ready? Okay:

Reuters

Inca Children "Fattened" Up For Sacrifice - Study

((----- Copy & Paste - W/O The Line Breaks -----))

http://www.reuters.com/article/scienceNews
/idUSL0192503320071001?pageNumber
=1&virtualBrandChannel=0

Oct 1, 2007

«LONDON (Reuters) - Hair samples taken from child mummies suggest the ancient Incas "fattened" up children chosen for ritual sacrifice months before actually killing them, British researchers said on Monday.

«A chemical analysis of four mummies found high in the Andes mountains also indicates the Incans took the children on a lengthy pilgrimage prior to the killings, the team said. In the case of the 15-year-old "Llullaillaco Maiden" the road to death started at least 12 months before.

«"We are looking at a process that began a considerable amount of time before their death," said Andrew Wilson, an archaeologist at the University of Bradford, who led the study. "The maiden was essentially being fattened up or prepared for her final fate at least 12 months before her killing."»

Does this story trouble you? First of all, I have a wicked bias against anthropologists and archaeologists to begin with. Something about them just seems to have a very false ring. This post isn't about some archaeological analysis concerning what might have transpired in the Peruvian Andes 500 years ago. This is about the notion of "Fattened Up For Sacrifice"! It's a troubling, yet very enduring theme. Troubling question: "What would it really feel like to be the one being "Fattened Up For Sacrifice"? The road to death! Can you even imagine it? Or rather, are you EXPERIENCING it? Who you gonna call? I had to Google around for it, but here's an old story I was looking for, I think:

Guerrilla News Network

Rockefeller Family Fables: Exxon, Eugenics, and CO²
May 18, 2008
By Sharon Smith

http://bodo.gnn.tv/blogs/28304/Rockefeller_Family_Fables
_Exxon_Eugenics_and_CO2

[....]

«By design, the Rockefellers have received no blame for their pivotal role in destroying the vast trolley car system that dominated U.S. cities before the 1940s, thereby increasing city dwellers’ dependency on automobiles and gas-fueled bus lines. Yet the Rockefellers’ Standard Oil of California joined General Motors, Firestone Tire, Standard Oil of California and Phillips Petroleum to form the National City Lines holding company, which bought out and dismantled more than 100 trolley systems in 45 cities (including New York, Detroit, Baltimore, Philadelphia, St. Louis, Salt Lake City, Tulsa, Minneapolis and Los Angeles) between 1936 and 1950.

«In 1949, these corporate defendants were acquitted of conspiring to monopolize transportation services. Indeed, the corporations behind National City Lines were each fined just $5,000—while each of their directors paid a mere $1 fine—a small price to pay for the windfall in profits they all enjoyed in the decades that followed. Congress offered up tax dollars to build the enormous highway infrastructure that encouraged automobile travel in the 1950s, while federal investment in mass transit and train systems languished. As Noam Chomsky noted, “By the mid-1960s, one out of six business enterprises was directly dependent on the motor vehicle industry.”»

Well, in the late 1960s I worked for the Connecticut Highway Department's Division of Surveys and Plans. We were building superhighways! I was at the bottom of the hierarchy, so I did many odd tasks. I might be hacking "sight lines" through tangled brush with a machete one day, and pumping the One Armed Bandit the next. The One Armed Bandit was a slot machine-like device that mostly cranked out square roots. It took hundreds of little gears to get to six decimal places, so the cranking required the application of considerable physical effort. They had one of the world's first computers, a rectangular box about the size of a sofa inside a Plexiglas coffin. It cost a couple million (sixties dollars!), and couldn't do 5% of what your PC can do. I know some things about highways.

I vaguely remember the astronomical construction costs. Something like a couple million for each tenth of a mile for a super. Mountains had to be literally moved (-- cut/fill --), communities relocated, etc., etc. Everything about this entailed tankerful after tankerful of oil. One quite simply does not move mountains with solar cells. The kicker was that after the brand-spanking- new super was commissioned, it would INSTANTLY begin to fall apart. The earth refuses to remain even under flat pavement. Hot and cold cycles disintegrate the pavement. Vehicles pound on it. And grass grows in the resulting cracks. And trees encroach in the right-of- way, then eventually fall on the highway. Vast quantities of focused, hard energy are constantly needed to maintain a nature defying, modernated superhighway. People talk about miles per gallon -- if they only knew about the GALLONS PER MILE!!!

Then there's the vehicles. How much energy is expended at steel mills to produce auto bodies? Plastic interiors? Electronic gizmos? Low-oxygen copper rotors and stators in alternators? Window glass? Etc?, etc?, etc? You mileage may vary, but JUST THE MANUFACTURE of an average motor vehicle uses up about the same amount of energy as the vehicle will consume as fuel over its lifespan!!! And the new hybrid cars need far more copper and gismos!

The Freedom of the Open Road!!!

Conspicuously Gaudy, Hyper-Modernated Suburban Ranches!!!

We have sold our souls for these perks, and our asses will follow! Oriental folks will own our roads and our mortgages now. Not individually, but collectively, we have been sold right down the fast lane to slavery. It's a great day! Go for a nice drive!

[Elaine Meinel Supkis]

The earliest computer was in Chicago. It was for nuclear bombs. Then given over part of the time to astronomers. I remember the mechanical machines for calculating things, I used to play with them behind my dad's back.

Love the square root churning machine. It is very much a religious connection, by the way. The churn that turns the box of magic that first grinds out gold, then salt then man's bones is such a machine. And square roots are very, very magical as any Pythogorian knows.

[Buffalo Ken]

blues - thanks for your insights.

I think I posted awhile back about sabotage of mass tranportation - it was a conscious effort of the oil/car corporate entities with GM at the forefront -- didn't GM just post something like 15.5 billion in losses? It is not a coincidence. In a way, GM is emblematic of the us of a. Broken from top to bottom but for the us of a mostly broken in the made-up, over-centralized, no-good, fucked-up, federal city of DC. The loonitary unitard executive, the do-nothing legislative, and the lawless judiciary. They are all so broken. They are all liars, theives, and criminals. They deserve what they are going to get and it ain't going to be pretty for them! Seems this way to me.

In my way of sensing things, you could call it "karma in action". I think karma is going exponential and its "wrapping" is going to start happening in days rather than decades or centuries. Everythings faster now. Wouldn't you say?

In thinking about it though, I say lets go ahead and sell all of our damn car roads. Let em have em cause they ain't really worth diddily anyhow when you consider all of the previously hidden costs that are now being revealed. Let em also purchase all the big planes and all the airports. Both cars and planes are so wasteful. If someone wants to get somewhere real fast, then they ought to have to pay the requisite price - a price that reflects the true cost. You know it is old life that is providing the fuel - we've been irreverently burning the dinasaurs and the trees like there ain't no tomorrow. It is almost as if someone is trying to make hell on earth, and it is so sad because this place could be like paradise. I've sensed it - have you?

On the other hand, tranportation along two rails is SO, SO much more efficient from the standpoint of energy. Trains can be local and they can be long distance. Trains can be slower or faster depending on the need. Trains are the way to go and I think unlike the time of the robber barons, EVERYONE should own the rails.

For that matter, I think everyone should own transportation. If it goes through your communinity you are entitled to a portion of any profits, and this would not be difficult to implement or enforce. In fact, communities could demand it, and if it isn't forthcoming then ALL transportation could literally be shutdown. That would be shame, but it does speak to who is in the "drivers seat".

Localism is coming one way or the other. Globalism is a fiction if it doesn't recognize localism as primary.

Furthermore, corporate entities are NOT ALIVE and those corporate entities that refuse to recognize the sanctity of life should be swiftly and harshly terminated. Literally. How ironic it would be to KILL the corporations that in reality have never been alive in the first place.

It is time to regain our better humanity because if not, time is running out. Don't you think?

I think time is of the essence. Time is infinite (with or without "us").

Peace,
Ken

[Buffalo Ken]

and bicycles make a lot of sense also...plus, they are good excercise!

[GK]

Hi Elaine, you lived through this NYC brink of bankruptcy 33 years ago, and it must be sickening to see it happening again.

New York and California are the crown jewels of the US economy and their governments are being systematically dismembered as shown below.

Can you imagine Schwartzenegger cutting 200,000 state workers' salaries to minimum wage? So much for employment contract law.

You are on your own folks.

http://www.economist.com/world/unitedstates/displaystory.cfm?story_id=11848977

"IT HAS been 33 years since the headline “Ford to City: DROP DEAD” was on the front page of the Daily News, but it has not been forgotten by New Yorkers. At the time, New York was on the brink of bankruptcy. The city defaulted on some bonds and owed $5 billion. One in five of all city jobs (including police ones) were eventually eliminated. The city closed several firehouses. But Gerald Ford was unhelpful.

Now, because of Wall Street’s ongoing meltdown, another fiscal crisis appears imminent, this time at state level. Costs are rising and revenues are falling fast. In June 2007 the 16 banks that pay the most taxes on their profits remitted $173m to the state treasury. Last month this dropped to $5m, a 97% decrease. This is a frightening fall given how much the state’s coffers rely on Wall Street taxes: 20% of all state revenues come from financial companies."

http://www.guardian.co.uk/world/2008/aug/01/usa2

"Arnold Schwarzenegger, the governor of California, delivered on his threat to lay off thousands of state employees on Thursday when he signed an executive order in an attempt to solve the state's budget crisis.

The move, dismissed by critics as a gesture to force legislators to reach a compromise on how to resolve the state's $15bn budget deficit, left more than 10,000 part-time and temporary employees without work yesterday. The order also reduced the pay of up to 200,000 state employees to the federal minimum wage of $6.55 an hour, below California's minimum."

[Elaine Meinel Supkis]

This is how depressions evolve: dropping wages, loss of jobs, falling asset values, bankrupt banks. Eventually, inflation dies because there is less money circulating.

Inflating the money to prevent this merely launches hyperinflation.

This is why steady, sane banking, lending and spending matter so much. Once you fall into a fiscal hole, it is very hard to get out of again.