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Drugs, Drugs, and More Drugs

The pharmaceutical industry in the United States has hoodwinked the public into believing its snake oils are worth the money you pay.  The government, “health care industry,” and insurance companies are happy to comply, and maybe some of them even believe their hype.

This does not stop them from jacking up the prices of necessary medications, like insulin for diabetes.  According to the New York Times, Martin Shkreli set a new record for Wall Street greed when he acquired the rights to Daraprim, a life-saving anti-parasitic drug, in 2015 and hiked the price from $13.50 to $750 a pill overnight.

The NYT says the Trump administration “went ballistic” when Pfizer increased prices a few weeks ago.  This has deterred Pfizer, along with Merck, Roche, and Novartis from raising prices, for now.

But not to worry, if you have stock in a pharmaceutical company, because the FDA and its sympathizers are on your side.  Only worry if your insurance company doesn’t cover the cost of your medications.

You might profit from buying stock in the companies whose drugs the FDA, the “health care industry,” and the insurance companies are pushing, such as the over-the-counter naloxone that is one of four medications promoted for “opioid use disorder.”  In terms of reputation, this “opioid crisis” has spread far and wide, to the highest government offices, academia, psychiatry, newspapers, magazines, television, the internet, the courts, and dinner-table talk.  Its funding has been greatly enhanced by the promoters of public disinformation, yet relevant facts are few.  All the stories have the monotonous flavor of canned worms, opened, sampled and regurgitated for yet another meal.

We are told about opioid-related deaths, the evil drug company that promoted its opioid drug as non-addictive, the lazy or greedy doctors who over-prescribe narcotics, and the glories of “medication-assisted treatment,” or MAT.  Somehow, heroin comes up in all these stories, yet most people should know heroin is nowhere legal in the United States, not even by prescription.  We are rarely told that this magical MAT consists of four drugs, two of which are opiates themselves, or that the federal government has added special training and licensing requirements for administration of its approved protocol. We are not told that “treatment” does not mean “cure.”  No, “cure” would imply eventual freedom from all drugs, a notion that doesn’t serve Wall Street profits.

So let me give you one example of how this scam works.  I hesitate to call it a “conspiracy” (wink, wink), because of the paranoia such a word implies.  I’d rather call it a “consortium” of interrelated interests, all of which stand to profit by exaggerating the problem and presenting expensive but ineffective solutions.

We are told opioid-related deaths have skyrocketed this century, and Oxycontin (oxycodone) is the precipitating culprit.  OxyContin is produced by Purdue Pharma, which indeed does have a shady background.  In 1952, three brothers—Arthur, Raymond, and Mortimer Sackler–all psychiatrists from Queens, New York, purchased Purdue Frederick Company.  Arthur was reputed to be brilliant in psychiatric research and pharmaceutical advertising.  Working for Roche, he found enough uses for Valium (diazepam) to make it the first drug to hit the $100 million mark in revenue.  He also “positioned” Librium (chlordiazepoxide) for Roche.  Valium and Librium are members of the “benzodiazepine” class of drugs, a class that includes Xanax (alprazolam), Ativan (lorazepam), Klonopin (clonazepam), and others.  Alternatively, oxycodone is a semi-synthetic opioid from thebaine, an opioid alkaloid in the Persian poppy.  It was developed in 1919 in Germany.

In December, 1995 the US Food and Drug Administration (FDA) approved Purdue’s OxyContin (oxycodone), to treat pain.  It hit the market in 1996. Direct-to-consumer (DTC) advertising of drugs was approved by the FDA in 1997.  Purdue marketed the drug to doctors and the public as a non-addictive treatment for pain.  It reached $45 million in sales the first year, and $1.1 billion by 2000.  By 2000, it was becoming evident that OxyContin was, indeed, addictive, but the FDA still approved a larger, 160-milligram pill for those with high tolerance.

In 2007, in US vs. Purdue Frederick Company, Inc., Purdue pleaded guilty to intent to mislead doctors and patients about the addictive properties of OxyContin.  It paid $600 million in fines, among the largest settlements for pharmaceutical companies in US history.

By 2010, revenues had hit $3.1 billion, or 30 percent of the painkiller market.  Purdue remains a privately held company, in the hands of the Sackler descendants.  It is being served with multiple lawsuits from different states for its role in contributing to the “opioid epidemic.”  According to The Week, Kentucky is one of the worst-hit states.  It has filed twelve claims against Purdue, for false advertising, Medicaid fraud, unjust enrichment, and punitive damages, among others.  The Week also says there was a four-fold increase in prescription painkillers supplied to pharmacies and MD offices between 1999 and 2010.

Meanwhile, The Guardian reported in 2017 that the US constitutes 80 percent of opioid pill production but has only five percent of the world’s population.  It claims the pharmaceutical companies made false claims of an “epidemic of pain,” in the 1990s, and the federal agencies went along.  Pharmaceutical lobbyists got Congress to loosen restraints, and doctors were often reprimanded for not supplying enough.  “Regulators became facilitators,” as the FDA approved one opioid pill after another.

How does this relate to heroin, a known street drug, one might ask.  It’s a good question, for which there are no easy answers.  The idea that prescription painkiller pills are “gateway” drugs to heroin use has been mentioned.  One source notes that heroin is less expensive on the street than OxyContin, which can cost $1/milligram, or $80 for an 80-mg pill.  A more significant problem with heroin, we are told, is that it is increasingly laced with fentanyl, another opiate that is up to 5000 times stronger than heroin.  Synthetic fentanyl is being smuggled in from China.  Heroin is coming from Mexico, some say.  Fact is, there are few facts available in this gigantic obfuscation of facts that characterizes sensationalism.

So we don’t exactly know how prescription pain-killers are related to heroin/fentanyl deaths.

Death from opioids usually comes from respiratory depression.  In other words, people who overdose pass out and stop breathing.  Many other drugs cause respiratory depression, too, and a mixture can have cumulative effects.  It is common for people with chronic pain to take both a narcotic (opioid) and a muscle relaxant/sedative of the benzodiazepine class mentioned above.  The benzodiazepines also cause respiratory depression, as does alcohol.   Too, it’s not clear how many of these opioid-related deaths are complicated by other substances.  One psychiatric journal mentioned that a third of opioid deaths were complicated by benzodiazepines.  It’s probably safe to say that hard-core street addicts could be taking many drugs at any given time.

But our “medication-assisted treatment” bypasses all these inconvenient details.  It does include a drug, naloxone, which reverses the effects of opioids and can save lives in a primary opioid emergency.  It has been around over 45 years and is well known in emergency rooms for its life-saving effects.  Since this crisis began, police and ambulance drivers have had to use it on numerous occasions.  Now, the US Surgeon General Jerome Adams, MD, MPH, has encouraged over-the-counter preparations of naloxone for those with opioid use disorder and their loved ones.  FDA head Scott Gottlieb is also advocating expanded access to treatment, Medicaid funding, and other systemic changes to pay for the problem.

Manufacturers of OTC naloxone have jumped to increase prices accordingly.  Narcan intranasal (Adapt Pharma Inc.) retails for $135/dose, more than double its price a few years ago.  Kaleo’s Evzio auto-injector now retails for $4,500, more than 6.5 times its $690 average price in 2014.

What’s not clear about this scenario is how a passed-out opioid over-doser who has stopped breathing will be able to administer the naloxone.  Irreversible brain damage occurs mere minutes after a person stops breathing.  The life-saving medication requires someone alert, quick to recognize the problem, and to administer the antidote.

With all the calls for funding, research, and treatment, no one is admitting that substance use treatment is notoriously ineffective.  FDA head Gottlieb and others are begrudgingly accepting the idea that cure may not be practical, and long-term maintenance must be considered.  So the magic bullet, the aforementioned MAT, or “medication-assisted treatment,” is not a cure.  It is designed to convert illegal opioid use to legal opioid use for perhaps a lifetime.  Of course this will require funding for treatment, for the treating facilities, support staff, the researchers, and for the prescriptions.

Who benefits from this crisis?  Well, the National Institute of Health has earmarked $1.1 billion to develop “scientific solutions,” backed by a $1.3 trillion omnibus package passed by Congress, according to Psychiatric News.

US President Donald Trump has declared the “opioid crisis” a public health emergency.  We have the White House Opioid Commission looking for ways to fund and treat the problem, including such issues as insurance coverage.  It recommends funding for no less than eight professional organizations.

The four approved medications in MAT are naloxone, mentioned above, naltrexone, and opioids buprenorphine and methadone, in case you want to buy stock in the companies.  Insurance company stock will most likely benefit, too.

The common denominator in this “emergency” is the use of more drugs to treat the drug problem in the drug-crazed culture we have created.

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How Do You Define Crazy?

What is “addiction”?  What causes it?  There’s a lot of attention given, lately, to various forms of “addiction,” but definitions of it and its clues about its causes are rare.  The American Psychiatric Association (APA), the primary lobbying organization for the professional mental disorder labelers, claims it is a “brain disease” that is “complex” and characterized by “compulsive substance use despite harmful consequences.”  The official platform, published on line, says there are a number of effective treatments, and that people can recover.

The APA also asserts there are “changes in brain wiring” as a result of addiction, and that “brain imaging studies show alterations in judgment, decision making, learning, memory, and behavioral control.”

The psychiatric establishment, including the National Institute for Drug Abuse, states brain changes in the brain stem, cerebral cortex and limbic system cause addiction.

So that’s our answer, in a nutshell.  Satisfied?

I’m not.  In fact, it’s embarrassing to admit I’m associated with such pretenders, because this propaganda campaign is nothing more than pandering to a group of people who probably know more about addiction than the “experts” do.  First, “addiction” per se is not listed among the growing list of “mental disorders” in the latest bible of psychiatric diagnosis, the Diagnostic and Statistical Manual of Mental Disorders, version V.  (DSM-V).  We have “substance use disorder,” and specific diagnoses related to the type of substance (mis)used, such as “opiate use disorder.”  We do have “internet addiction,” a new, DSM-V, excuse to seek funding for treatment.  But my rant here is not about addiction or the “opioid epidemic,” or even the marketing blitz that characterizes modern strategy for creating and perpetuating insanity.  It’s about terminology and the ocean of irrelevance that is pawned off as information to an under-informed, misinformed, and gullible public.

I first heard the term “brain disease” from members of the National Alliance for the Mentally Ill (NAMI), a lobbying group that prides itself on its family-associated organization, lobbying efforts for “mental health parity,” and its disassociation from mental health professionals.  NAMI has especially wanted to “de-stigmatize” mental illness by insisting it’s a “brain disease,” caused by a “chemical imbalance” in the brain, thus equivalent to physical diseases, even though there is little physical evidence for such conditions.

The psychiatric establishment, assisted by the pharmaceutical companies, the government, and to some extent, the insurance companies, has jumped on this opportunity to legitimize (and fund) research and treatment for a variety of mental disorders, and the list keeps growing.  Since the first DSM was published in 1952, the number of official mental disorders has steadily expanded, apparently to accommodate the tide of new medications flooding the market.  Homosexuality, formerly listed, has been expunged since 1987, but we have added problems you didn’t know were disorders, such as ‘social anxiety,” “adult attention-deficit hyperactivity disorder,” and “hypoactive sexual desire disorder.”  Insomnia is now an official psychiatric disorder, maybe thanks to the efforts of researchers and pharmaceutical companies that want to study and profit from it.

Lately, we are told the national suicide rate has gone up.  Army suicides are up, and there’s a question about whether some of the opioid-related deaths were intentional suicides.  We have the controversy over what used to be called “physician-assisted suicide,” which is no longer a politically or socially correct term, because it stigmatizes those who get a physician to help them die.  This is now called “medical aid in dying.”  Who remembers when Jack Kevorkian, a pathologist, went to prison in 1999 for helping patients die, convicted of second-degree murder?

Psychiatric terminology is tossed around with the same carelessness of standard epithets but carries the unsubstantiated veneer of insider knowledge.  Who hasn’t heard the president called a “narcissist?”  Look in the DSM-V to find out that “narcissistic personality disorder” could probably fit many people, depending on how one interprets the list of vague criteria, such as grandiosity or lack of empathy.  There are no “brain imaging studies” that prove it, and there’s no treatment.

To say the APA is misrepresenting itself, psychiatry, the mentally ill, and is flooding the public with irrelevance seems like a drastic claim, but here are the “facts.”  In its bid to align itself with “medical science,” such as it is, psychiatry likes to talk about “evidence-based” findings, but the evidence for most of its claims is based on subjective screening tools, such as Beck’s or Hamilton’s Depression scales, which depend on the patient or observer to assess symptoms or signs believed to contribute to clinical depression.

Also, the APA’s claim that “brain imaging studies” have identified specific areas of malfunction related to various mental disorders, is simply not true, but they keep trying, and the “psychiatric industry” is hot to obtain more funding for more research into the various potentialities of such tools as functional MRI and PET scans.

It is true that people under the influence of certain drugs and alcohol show more or less activity in certain brain areas, and autopsies of those with significant alcoholism, for instance, have brain changes consistent with long-term damage.

A great deal has been made over neurotransmitters, in order to justify the “chemical imbalance” hypothesis.  The class of antidepressants termed “serotonin-selective reuptake inhibitors” or “SSRIs”, led by the introduction of Prozac (fluoxetine) in 1989, quickly followed by copycats Zoloft (sertraline), Paxil (paroxetine), and others, spawned a new wave of psychiatric drugs that targeted specific brain chemicals (neurotransmitters).  Do they work?  There is increasing evidence that they don’t work for long, especially in children, and they may do more harm than good.  Approval by the FDA of direct-to-consumer (DTC) advertising in 1997 may have contributed to the upsurge in use of psychiatric as well as a host of other medications, and to the misperception that there’s a pill for every ill.

The “opioid epidemic,” deserves particular note, because it has been deemed by the Powers-That-Be as a “public health crisis,” deserving of broad-scale funding, research, special treatment protocols, legislation, and lawsuits against the pharmaceutical companies deemed most responsible for creating the problem.

Here, the psychiatric establishment–along with the government and media–has gone out of its way to misrepresent and inflate the problem, as well as its preferred solution, which is to hook people forever on different opiates.  The Need-To-Be-Needed crowd indirectly admits it has no cure, yet, but more funding will provide for better access to “care,” and for more research, such that maybe someday we will know enough to cut people loose from their psychiatric problems.

 

 

 

 

 

Rain and Mosquitoes

Anyone who believes humankind is at the top of the food chain does not live around mosquitoes.  In fact, if you believe my former microbiology professor, we have 1012 human cells, and 1013 microbial cells, so we are only ten percent human.  Perhaps we are merely mini-universes for the skin and gut flora, and the viruses and bacteria that make our respiratory tracts and other organic neighborhoods their homes.  Bottom line is humankind’s highest and best purpose may be to provide food and habitat for insects, viruses, and unicellular organisms.

This brings me to monotheism, the anthro-centric belief in a male-like supreme being who is detached and dominant, competitive, and paternalistic, omniscient, omnipotent, and perfect.

What does the monotheistic tradition have to do with mosquitoes, a reasonable person might ask.  Well, this God, according to tradition, has placed man above the animals, nature, and certainly above the lowly insects, bacteria, and viruses.  This God also must think cruelty is funny, because He torments man and woman with these miniature vampires that He could eradicate with a flip of a life-switch, if He so chose.  No, instead, He puts humanity in the position of alleviating his own misery through insecticides like malathion, or genetic engineering to produce sterile male mosquitoes under patent, for release in Key West, Florida.

In other words, this control-freak God, who seems to enjoy stirring up wars between the competitive monotheists descended from The Fall, must love mosquitoes, ticks, fleas, sand gnats, horseflies, lice, mites, and other fast-mutating species, more than He loves man.  This preference for more mutable life forms is charmingly depicted in Rats, Lice, and History:  The Biography of a Bacillus, by Hans Zinsser (1934), the original author of the microbiology textbook still used in medical schools today.  In it, Zinsser claims lice and other microbes win more wars than armies.  In any case, it offers even more proof that man has not evolved to the point where he understands how stupid he is to fight Mother Nature.

Speaking of Mother Nature, I recently finished reading The Power of Myth, by Joseph Campbell, with Bill Moyers.  This book was derived from a PBS documentary aired in 1988.  Campbell was a professor of comparative mythology at Sarah Lawrence College, well versed in the various beliefs around the world. He made a clear distinction between the monotheistic God as above-it-all creator; and the mother-goddess traditions in which the goddess is “within as well as without.”  He claimed these earth-centered traditions placed animals equal to man and sometimes superior. As mothers generally have unconditional love for all their children, the mother-goddess traditions evolved as naturally compassionate and what we might now call “eco-friendly.”

In the “deistic” or “animistic” belief systems of the Native American mythology, for instance, the natural and supernatural worlds are intimately interconnected.  While some of the ritualistic religious ceremonies may seem brutal now, they respected man’s role as a part of and totally dependent on nature’s bounty.   The primary food animal of a tribe was revered, respected, and often deified.  Feasting ceremonies prayed to the spirit of the animal, asking it to be re-born to provide food again.

Another of my books describes the Hopi Snake Society rain dances.  In these, dancers hold rattlesnakes in their mouths, as part of the ceremony appealing for rain.  The snakes are then released, in order to appeal to the rain gods on humankind’s behalf.  The book claims cloudbursts often follow.  (National Geographic Society’s Indians of the Americas, 1955).

A few years ago, Georgia Governor Sonny Perdue, responding to drought conditions, prayed for rain.  His prayers were followed by torrents in the mountains which caused flooding and a couple of fatalities.

I figured he prayed to the wrong God.  He should have prayed to Mother Nature, who loves all her creatures, even people, and knows that the right amount of rain at the right time and place benefits all equally.

So, for those interested in “climate change,” perhaps we need to redefine the problem and re-work the strategy, and turn thoughts toward changing the climate in more desirable ways.  Even Seth of the Jane Roberts series asserts that man’s thoughts influence weather.

While I haven’t resorted to dancing with rattlesnakes, I have made appeals to Mother Nature for a milder summer, here in the swamps of Savannah.  I have asked the plants and animals to join me in this weather-making experiment.  My chickens seem particularly good at it.  I’ve even reminded Ma Nature that it will help mosquitoes.  This latest twist on “climate change” is a conversation starter and actually elicits a few smiles.  That we could perhaps influence the weather in universally beneficial ways may be the stuff of science fiction today, but the concept is as inspiring as a rainbow, should you choose to believe.  And, no government help required.

Down home, this summer, we have had more rain than in recent years, along with more cloud cover and more breeze.  Even the little blood-suckers have held off, for reasons only known to Ma Nature, but I thank her nonetheless.

 

 

 

 

 

 

 

 

 

 

 

How Did It Happen?

Does anyone ever wonder how we got the income tax?  This tax has become so universal, on international, federal, state and even local levels, that it is taken for granted, but few people seem to question its legitimacy, history, or even its purpose.

An internet search suggests a form of “wealth tax” or income tax existed in the Roman Republic, ancient Egypt, and China, but the form we know, usually imposed to finance wars, began in England in 1188, by Henry II, for the “Saladin tithe” to fund the Third Crusade.

In his landmark book, Wealth of Nations, in 1776, Adam Smith, a Scott, suggested even the King of Britain could not get away with an income tax.  Tax on interest or money is difficult to calculate without extraordinary “inquisition” into every man’s private circumstances and “would be a source of such continual and endless vexation as no people could support.”  However, a mere nine years after Smith died in 1790, British Prime Minister William Pitt the Younger formally implemented the income tax, designed to pay for the French Revolutionary War, to purchase weapons and equipment.  It was a progressive income tax and in place between 1799 and 1816, but for a short reprieve following the Peace of Amiens in 1803.  It was reintroduced in Great Britain in 1842 by Prime Minister Sir Robert Peel, who was seeking revenues for the government’s increasing budget deficits.

“A heavy progressive or graduated income tax” is the second major tenet of the The Communist Manifesto, as delineated by Karl Marx and Friedrich Engels in 1848.  The fifth tenet advocates “Centralization of credit in the hands of the State by means of a national bank with State capital and an exclusive monopoly.”

In the United States, President Abraham Lincoln instituted the first US income tax in 1861 to pay debts from his war.  It was repealed by Congress in 1872.

The Socialist Labor Party pushed for an income tax in 1887.  The Populist Party demanded it in its 1892 platform, and the Democrats, led by William Jennings Bryan, advocated for the progressive income tax law passed in 1894.   Called the William-Gorman Tariff Act (Revenue Act), it reduced tariffs and imposed a two percent income tax but only on the top ten percent of earners.  In 1895, in Pollock v. Farmers Loan and Trust Co., the Supreme Court declared the tax unconstitutional, based on the constitutional requirements that taxation be apportioned by a state’s population.

Republican Rhode Island Senator Nelson W. Aldrich, who served between 1881 and 1911, was probably the single most influential individual in creating the financial structure we know today.  As chairman of the Senate Finance Committee–which oversaw bank regulation and monetary policy–he was possibly the most powerful man in the nation from 1898 to 1911. The financial Panic of 1907, (which some believe was engineered by banker and Aldrich friend/business associate, J. Pierpont Morgan) led to the Aldrich-Vreeland Act in 1908, which was designed to make the monetary supply more elastic.  It also established the National Monetary Commission with Aldrich becoming chairman.  As chairman, he led a team of “experts” to European capitals to study their banking practices, and returned as a proponent of a national banking system.  He worked in secret with powerful bankers to develop the “Aldrich Plan,” which eventually formed the basis of the Federal Reserve Act of 1913.  The secret dealings that began in 1910 and led to the creation of the Federal Reserve system is well documented in The Creature from Jekyll Island:  A Second Look at the Federal Reserve, by G. Edward Griffin.

Aldrich, who apparently had a habit of publicly opposing things he wanted, then voted in Congress for the corporate income tax in 1909, claiming this was to insure the personal income tax would not be passed.  Ten years before, he had called the income tax “communistic.”  However, later he and President William J. Taft then agreed that a constitutional amendment would be more effective in overriding the Supreme Court’s objections the 1894 law.  Aldrich claimed he believed the 16th amendment would never be approved.

The relationship between the Federal Reserve System and the new income stream generated by the income tax is not well documented, but it resembles that of the Whiskey Tax and the nation’s first central bank in 1791.  At that time, Treasury Secretary Alexander Hamilton introduced legislation for the whiskey tax on December 13, 1790 and for the central bank the next day, on December 14, 1790.

A common thread in the two bank/taxing schemes was that they gave the federal government the authority, if not the right, to investigate every taxpayer’s personal property and bank accounts searching for infractions, and to seize property it decides has been obtained illegally.  This has set the precedent for the federal invasion into private lives that has become so prevalent today.

In the “Gilded Age,” Nelson Aldrich was well known for his close and unsavory ties to business, by which he had become personally wealthy.  He believed his power base would successfully defeat the income tax amendment.  Indeed, while they were opposed, their solidarity had broken down, so individuals like Andrew Carnegie and John D. Rockefeller (whose son John Jr., married Aldrich’s daughter Abby) formed tax-exempt foundations to shelter their wealth before the tax went into effect.

At that time the income tax was promoted as a “class tax,” with only the upper income earners affected, so the idea of wealth re-distribution appealed to lower income earners.  Only later did President Franklin D. Roosevelt expand the “class tax” to a “mass tax,” according to former IRS historian Shelley L. Davis in her book, Unbridled Power: Inside the Secret Culture of the IRS.

Proponents of the income tax used other arguments, too.  It was proposed as a more reliable method than tariffs for raising federal revenues, and gave President Woodrow Wilson justification for reducing tariffs.  Also at that time the idea of Prohibition was in the air, and advocates of Prohibition recognized the government would lose income from excise taxes on alcohol.

The 16th Amendment reads, “The Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”  It was passed by Congress on July 2, 1909 and sent to the states for ratification.

It was supposedly ratified by the requisite number of states by February 13, 1913.  However, there is some question about whether it was ever properly ratified.  In 1985, William J. Benson published The Law that Never Was about the income tax.  Here, Benson claimed that in 1984 he had visited national archives and all 48 state capitals looking for records of ratification.  Not only had he found variations in wording and punctuation from the congressionally approved amendment, but he claimed some states which were certified as ratifying never did or voted against the amendment.  He said only two to four states had ratified as written.

Constitutional amendments require ratification by three-fourths of states.  In 1913, there were 48 states, so 36 would have had to ratify.  Benson found that seven states had not ratified at all.  1913 Secretary of State Philander Knox had claimed Kentucky and Tennessee ratified, but Benson said they did not.  Eight states were reported as having ratified, but Benson found no evidence of it.  Six more states did approve, but the governors or other officials required to sign did not sign.  Twenty-five states violated provisions of their own constitutions in ratification, and 29 violated state procedures.  Twenty-two states changed the wording to ratify, one state changed spelling, and 26 states changed punctuation.   Oklahoma changed the wording to say the opposite of what the amendment said.  Tennessee law required a delay until the next session but ignored it.

The American Law Division of Congress’ Congressional Research Service responded in May, 1985 to Benson’s claims.  “While it didn’t rebut Benson’s factual claims,” it said the amendment had been ratified “because Knox said it had been ratified,” says one internet source.

In 1990 Benson went to prison for tax evasion.  He served 15 months before a federal appeals panel overturned the conviction, saying a government witness had given improper testimony in the 1987 trial.  This occurred less than one month before Benson was scheduled for parole.

Benson’s book caused quite a stir, and he was selling packages based on his book to help individuals fight the Internal Revenue Service.  However, those who have used his arguments have not fared well in court.  Also, Benson himself was the loser in court rulings in 2007 and 2009 that determined his “Reliance Defense Package,” which he sold for $3500 to tax protesters, was fraudulent.

Courts have denied requests for evidentiary hearings and have refused to hear the arguments against the 16th amendment itself, claiming “Secretary Knox’ decision is now beyond review.”

In an interview in 2013, Benson remained an income-tax evader and bragged he has never gone back to prison, despite his continued outspoken crusade against the 16th amendment.

 

 

 

Wealth of Nations Synopsis

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Adam Smith’s landmark book, Wealth of Nations, published in 1776, is a 500-plus page treatise on economics, oft cited bur rarely read, except by economists and masochists like me.  If you can overlook Smith’s sing-song style, his tediousness, repetition, generalizations, vague and archaic terminology, and inconsistent reasoning, the book is worth reading, especially as a social history.  It is important to recognize that Smith writes as a spokesman for the monarchy and the wealthy stock holders, landowners, and mercantilists who made the book an immediate hit and won him a position as Commissioner of Customs in Edinburgh, Scotland.  His “commercial society” has enshrined him as the “first modern economist,” or “father of modern capitalism.”

A confluence of factors contributed to the conditions of Smith’s time.  The “industrial revolution” began in Britain with the invention of the steam engine in 1712, first used for pumping water out of coal mines.  Other inventions quickly followed, eventually leading to the growth and dominance of the British Empire, through manufacture, trade, and colonization. Another feature of 1700’s Britain involved war and military conquest.  As an island nation, with England, Scotland, and Wales united as the United Kingdom, or “Great Britain,” in 1707, it developed its sea power and had established dominance in the seas and in trading routes by the time Smith wrote Wealth of Nations.  Competition with other powers brought war and its heavy costs.

Wealth of Nations refers repeatedly to the “late war,” which presumably was the Seven Years’ War, fought between 1756 and 1763.  One of the book’s primary aims appears to be exploring the various modes of taxation the king could use to pay debts from that war.

Meanwhile, the industrial revolution was bringing a rapid shift in social and cultural dynamics, as Great Britain went from predominantly agrarian, rural society to one of urban and industrial predominance.  The textile industry was probably the first to be affected in a major way, with the invention of the spinning jenny–“jenny” is a nickname for “engine”–by Englishman James Hargreaves in 1764.

The iron industry also underwent fast transformation, and with it, the transportation industry.  Communication and banking adapted accordingly.

Because industrialization necessitated large capital investments, business ownership shifted from individuals to groups, including partnerships and corporations.  The banking industry grew by leaps and bounds after the Bank of England was first chartered in 1694.  The London Stock Exchange boomed after the Seven Years’ War.  The government became increasingly dependent on it to finance wars.

Like many of his contemporaries, including Benjamin Franklin, Thomas Jefferson, Alexander Hamilton, and George Washington, he was fascinated by machinery and its commercial potential.

In the first pages of Wealth, Smith presents the plan for the book, summarizing that the real wealth of a nation comes down to the “annual produce of the land and labor of the society.”

He then distinguishes between towns and agriculture and glorifies machines for facilitating division of labor, thus efficiency and productivity.  He uses pin-making as an example, with speed of production due to division of labor the only criterion.

Smith claims farmers are lazy, because as one-man operations, they waste time changing tasks, whereas a group of men in a “workhouse,” each doing one small task repeatedly, are able to produce much more in the same time period.

He says “Cochin-china” is one of several Asian countries that have sea access as well as extensive canals inland, but most of their trade is internal.  He wonders why they have not sought to trade outside their own countries.

Wealth emphasizes the enduring value of labor, despite the fluctuations in metal money.  The discovery of gold and silver in the Americas caused a glut in Europe that reduced the value to a third of what it was before.  A man can only do so much labor, but that labor holds its value through all the ups and downs of markets.

Wealth gives a multiplicity of examples of how labor costs rise and fall in relation to cities versus rural, or demand—such as North America, where labor was in great demand and food relatively inexpensive—and how much a laborer must be paid to sustain himself and children to replace him.  Since 50% of children die before reaching adulthood, says Smith, we need to calculate the cost of feeding four children in every family.  Smith acknowledges that all the laws favor the employers, should the laborers strike for higher wages.

While he presses the point that nothing happens without labor, Smith is happy to squeeze the laborer into a bare subsistence wage, better to keep him working hard to make ends meet.

He cites numerous examples of relationships between labor and stocks. New land, like the colonies, attracted lots of stock capital because it was cheap, full of natural resources, and soil was rich.

Early on “corporations” restricted competition, with the king’s (or queen’s) support.  Smith says 5th of Elizabeth formalized the “Statute of Apprenticeship” that restricted practice of craft or trade to those who had apprenticed seven years.  Church wardens, mandated by the king to provide for the poor in their parishes, did everything possible to keep the poor from moving in.

Corn was the major food crop in Europe.  Smith says tobacco grows well enough in parts of Europe, but it is illegal because it’s too hard to tax individual farmers, so tobacco is imported from (primarily) Virginia and Maryland, warehoused, and resold at profit.  Sugar is in great demand, and is very expensive, imported from Caribbean colonies.  In “Cochin-china” sugar is no more expensive than ordinary food crops and is cultivated alongside them and apparently not exported much.

Labor and landlords benefit from policies that also serve the public.  Stockholders, however, are loud, moneyed, and invested in reducing competition, so they generally work against the public good.

Smith explains how money is not the same as circulating capital.  It is the “wheel” of the economic engine but has no intrinsic value.  A coin is not used up when it is exchanged for goods or services, so the same coin, each time it changes hands, buys its face value for the purchaser, who gets his coin’s “worth” in product.

He also writes about the banks, primarily of Scotland, that used paper money promissory notes in excess of gold deposits for lending.  80% paper to 20% backup.  Merchants could also get lines of credit, so were encouraged to accept that bank’s paper in trade, to promote it to friends and associates, and to spend it.  However, paper was no good in foreign countries, so gold was exported to import foreign products.

“No equal capital puts into motion a greater quantity of productive labor than that of the farmer,” says Smith.  Also, farms stay put, like retail shops, and can’t be outsourced.

He discusses how the American trade is financed by merchants in Great Britain.  He uses the example of hogsheads of tobacco from Virginia and Maryland as commodity money that is bought in excess by England and resold in other places.

But the “great commerce of every civilized society” is between country and town.  In fact, the home trade, by far the most important, was considered subsidiary to foreign trade, based on Man’s book, England’s Treasure in Foreign Trade.  Smith says the mercantile system works in many ways against the enrichment of the country.  It selectively encourages exportation and discourages importation.

He says it is a mistake to politically favor exports over imports.  Restraints on imports consist of high duties and absolute prohibitions.  Exports were encouraged by “drawbacks” (tax relief), “bounties (subsidies), advantageous treaties, and the establishment of colonies.  Smith is down on bounties.  He specifically mentions corn, because it, to him, is the commodity by which the price of everything else is measured.

He claims restraints on importation and prohibitions may be good for the home manufacturers but not for the population or the economy as a whole.  The famous “invisible hand” comes up on page 300, in which Smith mentions the folly of “statesmen” who try to control private enterprise.  He says the market will determine what is needed without government help.

Merchants and manufacturers derive the most benefit from monopolies, says he, whereas farmers and populace derive little and undoubtedly lose by them.  Corn merchants benefit more from subsidies than corn farmers.

The notion of “balance of trade” is “absurd,” and he enumerates reasons.  Smith also states that it is silly for nations to try to improve their wealth at the expense of other nations.  This leads to hostilities rather than friendly exchanges.

Smith asserts again that all wealth comes from the land, with farmers the most productive workers and everyone else subsidiary.  Those who bring raw materials to more useable form, like wool manufacturers, do not add as much value as the farmer does by cultivating the land.

Smith cites the duties of the sovereign.  He claims the sovereign does not have the duty or right to regulate commerce.  At the same time, he says the king’s first duty is to protect the country from other governments.

He makes the case for a standing army and says this is the only way the sovereign can maintain peace and order.  Now “civilized” societies can conquer “barbarous” societies, which don’t have the advantage of gun power.  He believes, therefore, that gun power equals civilization.

Smith mentions highways, bridges, navigable canals, coinage, and the post office as public institutions that facilitate commerce.  Post offices everywhere, he says, are valuable revenue sources for the government, with steady and immediate cash flow and low maintenance costs.

Obviously, a glaring inconsistency in Smith’s premise is between his views on free trade and his belief in the importance of a standing army.  Here we have our pseudo proponent of free trade justifying forts and garrisons in foreign countries to protect merchants’ stores.  Where these countries do not allow forts, it has been necessary to send ambassadors.  Smith believes most ambassadorships were created to protect trade.

He goes into “regulated companies,” which are open to anyone with the money, willing to submit to the rules, and trading his own stock at his own risk.  These are opposed to “joint stock” companies, which sound like publically traded companies today.  Pooled resources and pooled profits.  He says only four types of joint stock companies seem valid.  He cites:  1. The banking industry; 2. Fire and sea-risk insurance companies; 3. Canal or navigable channel companies; and 4. Those bringing water by pipe or otherwise to a great city.  He notes the Bank of England doesn’t have exclusive privilege, except that no other bank in England can employ more than six people, and the Bank of England lends to the sovereign.

The last hundred pages of the book are devoted to taxes and other potential sources of revenue for the commonwealth or sovereign.

He floats the concept of a central bank, calling it a “public bank to support public credit, and upon particular emergencies to advance to government the whole produce of a tax, to the amount, perhaps, of several millions, a year or two before it comes in.”

Smith asserts the king should be wealthier than anyone, with grand style and pomp to support his “dignity.”

He distinguishes between direct and indirect taxes, saying the former, as on land, are easily assessed.  Tax on interest or money is difficult to calculate without extraordinary “inquisition” into every man’s private circumstances and “would be a source of such continual and endless vexation as no people could support.”

“There is no art which one government sooner learns of another, than that of draining money from the pockets of the people.”

Wages on the “inferior classes of workmen” are regulated by demand for labor and the price of provisions.  As taxes on labor go up, wages must go up more, to cover the additional tax.  Manufacturers can pass these costs on to the consumer, but farmers’ landlords must absorb them.  This leads to a decrease in the demand for labor.  “Absurd and destructive as such taxes are, however, they take place in many countries.”

Smith goes into government jobs, which are much sought after, because they are highly paid and carry perquisites (perks).  Taxes on luxuries do not raise the price of other commodities, but those on necessities do, so should not be taxed. He mentions alcohol taxes as by far the most productive.

Excise taxes are generally on home goods destined for home markets and imposed on only certain items of the most general use. Excise laws discourage smuggling more effectively than customs laws.

He acknowledges that poor people, because there are more of them, consume the most, not only in quantity, but in value.

He mentions that war has required even the most frugal republics to contract great debts to maintain independence.  He says it is incorrect to assume money lent to government increases capital, because it is generally wasted, and that money would otherwise be spent on productive labor.  Also, foreigners often buy in.

“When national debts have once been accumulated to a certain degree, there is scarce, I believe, a single instance of their having been fairly and completely paid.”

Wealth ends rather abruptly on the subject of public debt, saying that when it exceeds taxpayers’ ability to pay with reasonable measures, government uses unreasonable measures, such as issuing interest-free bonds for immediate expenses, or interest-only bonds that are never intended to be repaid.  He says this has “enfeebled” multiple governments.

When governments reach the point where they can’t pay the debt, they either inflate the currency or declare bankruptcy.  He says the latter is more honest, but says the entire system of debt-backed government is “pernicious.”

My take is the tradition of monarchs and overlords has led to societies in which unearned wealth is glorified and held in high esteem.  The most highly respected and emulated are those who have done the least to acquire what they have, in general terms. The very idea, The Wealth of Nations, presumes the nations own the individuals who live within their borders.

 

 

 

Monsanto and Bayer Merged

The following is re-blogged from Justice4Poland.com, a good site for updates on the chemicals and pharmaceutical industries.

June 7, 2018 GMO Fact Check Bayer’s buyout of the biotech giant will allow Monsanto to hide in the shadows. Action Alert! Bayer, the German pharmaceutical company, is wrapping up a $63 billion dollar purchase of Monsanto, and has said that it will retire Monsanto’s name. It will become impossible to know which products are […]

via Monsanto is Finally Gone…But Not in a Good Way — Justice4Poland.com

Hamilton’s Legacy

As the rich get richer and the poor get poorer, pundits and philosophers theorize about the problems of income inequality, social stratification, and legal injustice.  Proposed solutions flow thick and fast, most advocating government intervention or denouncing government de-regulation since the Great Depression.

The American myth of freedom, democracy, and capitalism dies hard, but the United States has never been free, democratic, or even capitalistic, unless it was before the Europeans arrived.  Stratification of society was built into the system with the arrival of the English and their traditions of monarchs and minions, the French and Spanish, and their long histories of battle and inbreeding among themselves on the European continent.

The American experiment may have represented a break from the past, but it carried with it the same patriarchal patterns of its forebears.  The “Founding Fathers” ultimately adopted a government structure that varied only slightly from that of its British progenitors.

Many US citizens don’t know the difference between the Declaration of Independence, which we celebrate on July 4 every year, and the Constitution, which was drafted in secrecy and signed on September 17, 1787, over eleven years after the Declaration announced the United States’ independence from Britain.

In that eleven year gap, the Revolutionary War had been fought and won.  The now free colonies were struggling with debts to soldiers, domestic, and foreign investors.  The individual states had taxing power, but the loosely formed union did not.  Some states were paying off their debts, but others were lagging.  John Adams had been sent to London to negotiate credit for the fledgling country, and Thomas Jefferson had been sent to France for the same purpose, to replace Benjamin Franklin, who was aging and ill.

James Madison of Virginia and Alexander Hamilton of New York led the effort to revise the Articles of Confederation with a new Constitution that would create a strong central government, supersede state governments, and have the taxing power to pay war debts.  Once gathered at what became the Constitutional Convention in Philadelphia, though, each delegate learned the intent was to completely re-write the Articles and was sworn to strict secrecy. George Washington was unanimously elected president.  Madison sat by his side taking notes and was later acknowledged as having written the Constitution.  Alexander Hamilton was a strong advocate for a centralized government, brilliant and opinionated, an open admirer of the British model, including the monarchy, and wanted to reproduce the British system in the states.  He also extolled wealth and privilege, claiming the masses could not be trusted to manage their own affairs.  Madison was of the same general opinion.

While he initially opposed the Constitution, Hamilton later became its strongest advocate and promoter.  He induced Madison and John Jay to write with him what became the Federalist Papers, a series of anonymous essays distributed to newspapers to promote ratification by the states.  For ratification, the Philadelphia conventioneers chose to bypass state legislatures and rely on specifically convened  ratification conventions.

Hamilton played an early and profound role in shaping the early American government.  According to his biographer, Ron Chernow*, he was an illegitimate child of a dissolute couple, born in 1755 or 1757 on the British island of Nevis in the West Indies.  After his father abandoned the family and his mother died, he was employed at age 13 as a clerk and bookkeeper for wealthy British traders on St. Croix, also in the West Indies.  His employers traded in a variety of goods, but at least one shipment a year was of African slaves.  Those employers eventually financed Hamilton’s migration to the New York colony in 1773, where periodic shipments of slave-produced sugar covered his expenses.

Hamilton, who was dashing and gifted, quickly made his way into New York society, courting and marrying a daughter, Elizabeth, of the prominent Philip Schuyler.  He enlisted in George Washington’s Continental Army, gained Washington’s confidence and became his personal secretary during the Revolutionary War years.  Later, Washington granted him his one and only command, at the battle of Yorktown, where Continental and French forces defeated British General Cornwallis to win the Revolutionary War.

After the war ended, Hamilton practiced law in New York City and involved himself in politics.    He also involved himself in banking, writing the constitution for the Bank of New York in 1784, as agent for his brother-in-law, John B. Church, who was in Britain acting as a member of Parliament.  It was New York’s first bank and exists today as BNY-Mellon, billed as having the longest continually traded stock on the New York Stock Exchange.

After the Constitution was ratified, George Washington became the first US president, elected in 1788.  John Adams was elected vice president, and Hamilton became Washington’s first Treasury Secretary.  Thomas Jefferson, who was still in France, was appointed Secretary of State and confirmed by the Senate before he knew of his appointment.

Hamilton went to work immediately to take control of the nation’s finances.  The day after his confirmation as Secretary of the Treasury, he arranged for a $50,000 loan from the Bank of New York—of which he was a director–to pay salaries of Washington and Congress.  He then arranged for another $50,000 loan from the Bank of North America.  The Hamilton Tariff Act of 1789 was Congress’ second official move, after establishing rules for taking oaths of office.

By 1790, Hamilton was busy working on a plan for the federal government to assume state debts from the Revolutionary War.  In the Constitutional Convention the question of assumption had split—like the slavery issue—essentially along North-South lines, because Southern states had paid off much of their debt, while northern states, like New York, had not.  The issue dovetailed with questions about the ultimate location of the nation’s capital.  Madison, silently backed by George Washington, negotiated for a Potomac River location near Washington’s Mount Vernon plantation in exchange for agreeing that the federal government would assume the states’ debt.

Meanwhile, Hamilton was busy creating the First Bank of the United States, a central bank that could issue credit, capitalized at $10 million, 20% owned by the government and 80% owned by shareholders.  He was also looking for other sources of income and convinced Washington and Congress to support an excise tax on whiskey.  He introduced legislation for the whiskey tax on December 13, 1790 and for the central bank December 14, 1790.  At that point, Washington’s main source of income came from whiskey distillation.

Both James Madison and Thomas Jefferson vigorously opposed the central bank, calling it unconstitutional.  Madison and Hamilton had been allies before, but this difference in interpretation of the Constitution caused a rift that never healed.  Jefferson and Madison wrote letters back and forth condemning the mad stock speculation that greeted the public offering of central bank stock, and the fact that people in the Northeast could talk of nothing else.  Once again, critics claimed Hamilton demonstrated a preference for rich Northerners, as he only offered the stock through three banks, in Boston, New York, and Philadelphia.  Also, opponents pointed to the fact that three-fourths of investors were foreign.  Thirty of the approximately 85 Congressmen bought shares.

Hamilton’s assistant Treasury Secretary, William Duer, could be called one of the nation’s first inside traders.  Philip Schuyler, who would become Hamilton’s father-in-law, had previously done business with Duer and had encouraged him to move from Antigua to New York.  Duer became an early friend when Hamilton immigrated to the continent.  But Duer turned out to be an inveterate gambler and stock speculator who was blamed for causing the Panic of 1892 through debt-backed stock speculation in First Bank of the United States stock. His method was to borrow heavily to make trades, hoping to sell at peak prices, but he ran out of cash and couldn’t make payments on his debts.  People panicked and started selling stock.  Hamilton then used the Treasury’s sinking fund to buy government securities anonymously, to stem the panic.

As a result of the crisis, to restore confidence, and to encourage people to start investing again, 24 stock brokers and merchants formed the New York Stock Exchange in May, 1792, by signing the so-called “Buttonwood Agreement,” under a buttonwood tree on Wall Street.  The signers agreed to trade only with each other, and to charge one-quarter percent commission on trades.  Available stock was limited to insurance companies, the Bank of New York, the First Bank of the United States, and Hamilton Bonds that Hamilton had decided to issue to pay Revolutionary War debt.

The United States has operated as a triumvirate of government, banking, and the stock market ever since.  The “Framers” of the Constitution were wealthy businessmen, planters, bankers, lawyers, and merchants, who designed a structure for exerting control over the population through laws and taxation.  While the Declaration of Independence set the states free, the Constitution bound them in economic slavery to a new taxing authority.  The links to the banking system and the New York Stock Exchange initiated the “public-private partnerships” that define the United States today.

If, in the 21st century the rich are getting richer and the poor getting poorer, it’s probably fair to say it was designed that way.  The Framers knew what they were doing.

 

*  The recent Broadway hit Hamilton is based on Chernow’s book, Alexander Hamilton, 2004.