Category Archives: fighting back

Financing the Green New Deal


Sister Ellen—Keep on preaching the truth as demonstrated by the successful social actions of North Dakota's Non-Partisan League, the KfW Bank of Germany, and FDR's RFC. The BIGGEST single impediment to a more enlightened approach to the oncoming catastrophe that is climate change is the fact that we allow our monetary system to be run by thieves.

The Financial Secret Behind Germany’s Green Energy Revolution

Ellen Brown | January 26, 2019

The “Green New Deal” endorsed by Rep. Alexandria Ocasio-Cortez, D.-N.Y., and more than 40 other House members has been criticized as imposing a too-heavy burden on the rich and upper-middle-class taxpayers who will have to pay for it. However, taxing the rich is not what the Green New Deal resolution proposes. It says funding would come primarily from certain public agencies, including the U.S. Federal Reserve and “a new public bank or system of regional and specialized public banks.”

Funding through the Federal Reserve may be controversial, but establishing a national public infrastructure and development bank should be a no-brainer. The real question is why we don’t already have one, as do China, Germany and other countries that are running circles around us in infrastructure development. Many European, Asian and Latin American countries have their own national development banks, as well as belong to bilateral or multinational development institutions that are jointly owned by multiple governments. Unlike the U.S. Federal Reserve, which considers itself “independent” of government, national development banks are wholly owned by their governments and carry out public development policies.

China not only has its own China Infrastructure Bank but has established the Asian Infrastructure Investment Bank, which counts many Asian and Middle Eastern countries in its membership, including Australia, New Zealand and Saudi Arabia. Both banks are helping to fund China’s trillion-dollar “One Belt One Road” infrastructure initiative. China is so far ahead of the United States in building infrastructure that Dan Slane, a former adviser on President Donald Trump’s transition team, has warned, “If we don’t get our act together very soon, we should all be brushing up on our Mandarin.”


The leader in renewable energy, however, is Germany, called “the world’s first major renewable energy economy.” Germany has a public sector development bank called KfW (Kreditanstalt für Wiederaufbau or “Reconstruction Credit Institute”), which is even larger than the World Bank. Along with Germany’s nonprofit Sparkassen banks, KfW has largely funded the country’s green energy revolution.

Unlike private commercial banks, KfW does not have to focus on maximizing short-term profits for its shareholders while turning a blind eye to external costs, including those imposed on the environment. The bank has been free to support the energy revolution by funding major investments in renewable energy and energy efficiency. Its fossil fuel investments are close to zero. One of the key features of KfW, as with other development banks, is that much of its lending is driven in a strategic direction determined by the national government. Its key role in the green energy revolution has been played within a public policy framework under Germany’s renewable energy legislation, including policy measures that have made investment in renewables commercially attractive.

KfW is one of the world’s largest development banks, with assets totaling $566.5 billion as of December 2017. Ironically, the initial funding for its capitalization came from the United States, through the Marshall Plan in 1948. Why didn’t we fund a similar bank for ourselves? Simply because powerful Wall Street interests did not want the competition from a government-owned bank that could make below-market loans for infrastructure and development. Major U.S. investors today prefer funding infrastructure through public-private partnerships, in which private partners can reap the profits while losses are imposed on local governments.

KfW and Germany’s Energy Revolution

Renewable energy in Germany is mainly based on wind, solar and biomass. Renewables generated 41 percent of the country’s electricity in 2017, up from just 6 percent in 2000; and public banks provided over 72 percent of the financing for this transition. In 2007-09, KfW funded all of Germany’s investment in Solar Photovoltaic. After that, Solar PV was introduced nationwide on a major scale. This is the sort of catalytic role that development banks can play—kickstarting a major structural transformation by funding and showcasing new technologies and sectors.

KfW is not only one of the biggest financial institutions but has been ranked one of the two safest banks in the world. (The other, Switzerland’s Zurich Cantonal Bank, is also publicly owned.) KfW sports triple-A ratings from all three major rating agencies—Fitch, Standard and Poor’s, and Moody’s. The bank benefits from these top ratings and the statutory guarantee of the German government, which allow it to issue bonds on very favorable terms and therefore to lend on favorable terms, backing its loans with the bonds.

KfW does not work through public-private partnerships, and it does not trade in derivatives and other complex financial products. It relies on traditional lending and grants. The borrower is responsible for loan repayment. Private investors can participate, but not as shareholders or public-private partners. Rather, they can invest in “Green Bonds,” which are as safe and liquid as other government bonds and are prized for their green earmarking. The first “Green Bond—Made by KfW” was issued in 2014 with a volume of $1.7 billion and a maturity of five years. It was the largest Green Bond ever at the time of issuance and generated so much interest that the order book rapidly grew to $3.02 billion, although the bonds paid an annual coupon of only 0.375 percent. By 2017, the issue volume of KfW Green Bonds reached $4.21 billion.

Investors benefit from the high credit and sustainability ratings of KfW, the liquidity of its bonds, and the opportunity to support climate and environmental protection. For large institutional investors with funds that exceed the government deposit insurance limit, Green Bonds are the equivalent of savings accounts—a safe place to park their money that provides a modest interest. Green Bonds also appeal to “socially responsible” investors, who have the assurance with these simple and transparent bonds that their money is going where they want it to. The bonds are financed by KfW from the proceeds of its loans, which are also in high demand due to their low interest rates, which the bank can offer because its high ratings allow it to cheaply mobilize funds from capital markets and its public policy-oriented loans qualify it for targeted subsidies.

Roosevelt’s Development Bank: The Reconstruction Finance Corporation

KfW’s role in implementing government policy parallels that of the Reconstruction Finance Corporation (RFC) in funding the New Deal in the 1930s. At that time, U.S. banks were bankrupt and incapable of financing the country’s recovery. President Franklin D. Roosevelt attempted to set up a system of 12 public “industrial banks” through the Federal Reserve, but the measure failed. Roosevelt then made an end run around his opponents by using the RFC that had been set up earlier by President Herbert Hoover, expanding it to address the nation’s financing needs.

The RFC Act of 1932 provided the RFC with capital stock of $500 million and the authority to extend credit up to $1.5 billion (subsequently increased several times). With those resources, from 1932 to 1957 the RFC loaned or invested more than $40 billion. As with KfW’s loans, its funding source was the sale of bonds, mostly to the Treasury itself. Proceeds from the loans repaid the bonds, leaving the RFC with a net profit. The RFC financed roads, bridges, dams, post offices, universities, electrical power, mortgages, farms and much more; it funded all of this while generating income for the government.

The RFC was so successful that it became America’s largest corporation and the world’s largest banking organization. Its success, however, may have been its nemesis. Without the emergencies of depression and war, it was a too-powerful competitor of the private banking establishment; and in 1957, it was disbanded under President Dwight D. Eisenhower. That’s how the United States was left without a development bank at the same time Germany and other countries were hitting the ground running with theirs.

Today some U.S. states have infrastructure and development banks, including California, but their reach is very small. One way they could be expanded to meet state infrastructure needs would be to turn them into depositories for state and municipal revenue. Rather than lending their capital directly in a revolving fund, this would allow them to leverage their capital into 10 times that sum in loans, as all depository banks are able to do, as I’ve previously explained.

The most profitable and efficient way for national and local governments to finance public infrastructure and development is with their own banks, as the impressive track records of KfW and other national development banks have shown. The RFC showed what could be done even by a country that was technically bankrupt, simply by mobilizing its own resources through a publicly owned financial institution. We need to resurrect that public funding engine today, not only to address the national and global crises we are facing now but for the ongoing development the country needs in order to manifest its true potential.

© 2019 TruthDig

Financing the Green New Deal


Sister Ellen—Keep on preaching the truth as demonstrated by the successful social actions of North Dakota's Non-Partisan League, the KfW Bank of Germany, and FDR's RFC. The BIGGEST single impediment to a more enlightened approach to the oncoming catastrophe that is climate change is the fact that we allow our monetary system to be run by thieves.

The Financial Secret Behind Germany’s Green Energy Revolution

Ellen Brown | January 26, 2019

The “Green New Deal” endorsed by Rep. Alexandria Ocasio-Cortez, D.-N.Y., and more than 40 other House members has been criticized as imposing a too-heavy burden on the rich and upper-middle-class taxpayers who will have to pay for it. However, taxing the rich is not what the Green New Deal resolution proposes. It says funding would come primarily from certain public agencies, including the U.S. Federal Reserve and “a new public bank or system of regional and specialized public banks.”

Funding through the Federal Reserve may be controversial, but establishing a national public infrastructure and development bank should be a no-brainer. The real question is why we don’t already have one, as do China, Germany and other countries that are running circles around us in infrastructure development. Many European, Asian and Latin American countries have their own national development banks, as well as belong to bilateral or multinational development institutions that are jointly owned by multiple governments. Unlike the U.S. Federal Reserve, which considers itself “independent” of government, national development banks are wholly owned by their governments and carry out public development policies.

China not only has its own China Infrastructure Bank but has established the Asian Infrastructure Investment Bank, which counts many Asian and Middle Eastern countries in its membership, including Australia, New Zealand and Saudi Arabia. Both banks are helping to fund China’s trillion-dollar “One Belt One Road” infrastructure initiative. China is so far ahead of the United States in building infrastructure that Dan Slane, a former adviser on President Donald Trump’s transition team, has warned, “If we don’t get our act together very soon, we should all be brushing up on our Mandarin.”


The leader in renewable energy, however, is Germany, called “the world’s first major renewable energy economy.” Germany has a public sector development bank called KfW (Kreditanstalt für Wiederaufbau or “Reconstruction Credit Institute”), which is even larger than the World Bank. Along with Germany’s nonprofit Sparkassen banks, KfW has largely funded the country’s green energy revolution.

Unlike private commercial banks, KfW does not have to focus on maximizing short-term profits for its shareholders while turning a blind eye to external costs, including those imposed on the environment. The bank has been free to support the energy revolution by funding major investments in renewable energy and energy efficiency. Its fossil fuel investments are close to zero. One of the key features of KfW, as with other development banks, is that much of its lending is driven in a strategic direction determined by the national government. Its key role in the green energy revolution has been played within a public policy framework under Germany’s renewable energy legislation, including policy measures that have made investment in renewables commercially attractive.

KfW is one of the world’s largest development banks, with assets totaling $566.5 billion as of December 2017. Ironically, the initial funding for its capitalization came from the United States, through the Marshall Plan in 1948. Why didn’t we fund a similar bank for ourselves? Simply because powerful Wall Street interests did not want the competition from a government-owned bank that could make below-market loans for infrastructure and development. Major U.S. investors today prefer funding infrastructure through public-private partnerships, in which private partners can reap the profits while losses are imposed on local governments.

KfW and Germany’s Energy Revolution

Renewable energy in Germany is mainly based on wind, solar and biomass. Renewables generated 41 percent of the country’s electricity in 2017, up from just 6 percent in 2000; and public banks provided over 72 percent of the financing for this transition. In 2007-09, KfW funded all of Germany’s investment in Solar Photovoltaic. After that, Solar PV was introduced nationwide on a major scale. This is the sort of catalytic role that development banks can play—kickstarting a major structural transformation by funding and showcasing new technologies and sectors.

KfW is not only one of the biggest financial institutions but has been ranked one of the two safest banks in the world. (The other, Switzerland’s Zurich Cantonal Bank, is also publicly owned.) KfW sports triple-A ratings from all three major rating agencies—Fitch, Standard and Poor’s, and Moody’s. The bank benefits from these top ratings and the statutory guarantee of the German government, which allow it to issue bonds on very favorable terms and therefore to lend on favorable terms, backing its loans with the bonds.

KfW does not work through public-private partnerships, and it does not trade in derivatives and other complex financial products. It relies on traditional lending and grants. The borrower is responsible for loan repayment. Private investors can participate, but not as shareholders or public-private partners. Rather, they can invest in “Green Bonds,” which are as safe and liquid as other government bonds and are prized for their green earmarking. The first “Green Bond—Made by KfW” was issued in 2014 with a volume of $1.7 billion and a maturity of five years. It was the largest Green Bond ever at the time of issuance and generated so much interest that the order book rapidly grew to $3.02 billion, although the bonds paid an annual coupon of only 0.375 percent. By 2017, the issue volume of KfW Green Bonds reached $4.21 billion.

Investors benefit from the high credit and sustainability ratings of KfW, the liquidity of its bonds, and the opportunity to support climate and environmental protection. For large institutional investors with funds that exceed the government deposit insurance limit, Green Bonds are the equivalent of savings accounts—a safe place to park their money that provides a modest interest. Green Bonds also appeal to “socially responsible” investors, who have the assurance with these simple and transparent bonds that their money is going where they want it to. The bonds are financed by KfW from the proceeds of its loans, which are also in high demand due to their low interest rates, which the bank can offer because its high ratings allow it to cheaply mobilize funds from capital markets and its public policy-oriented loans qualify it for targeted subsidies.

Roosevelt’s Development Bank: The Reconstruction Finance Corporation

KfW’s role in implementing government policy parallels that of the Reconstruction Finance Corporation (RFC) in funding the New Deal in the 1930s. At that time, U.S. banks were bankrupt and incapable of financing the country’s recovery. President Franklin D. Roosevelt attempted to set up a system of 12 public “industrial banks” through the Federal Reserve, but the measure failed. Roosevelt then made an end run around his opponents by using the RFC that had been set up earlier by President Herbert Hoover, expanding it to address the nation’s financing needs.

The RFC Act of 1932 provided the RFC with capital stock of $500 million and the authority to extend credit up to $1.5 billion (subsequently increased several times). With those resources, from 1932 to 1957 the RFC loaned or invested more than $40 billion. As with KfW’s loans, its funding source was the sale of bonds, mostly to the Treasury itself. Proceeds from the loans repaid the bonds, leaving the RFC with a net profit. The RFC financed roads, bridges, dams, post offices, universities, electrical power, mortgages, farms and much more; it funded all of this while generating income for the government.

The RFC was so successful that it became America’s largest corporation and the world’s largest banking organization. Its success, however, may have been its nemesis. Without the emergencies of depression and war, it was a too-powerful competitor of the private banking establishment; and in 1957, it was disbanded under President Dwight D. Eisenhower. That’s how the United States was left without a development bank at the same time Germany and other countries were hitting the ground running with theirs.

Today some U.S. states have infrastructure and development banks, including California, but their reach is very small. One way they could be expanded to meet state infrastructure needs would be to turn them into depositories for state and municipal revenue. Rather than lending their capital directly in a revolving fund, this would allow them to leverage their capital into 10 times that sum in loans, as all depository banks are able to do, as I’ve previously explained.

The most profitable and efficient way for national and local governments to finance public infrastructure and development is with their own banks, as the impressive track records of KfW and other national development banks have shown. The RFC showed what could be done even by a country that was technically bankrupt, simply by mobilizing its own resources through a publicly owned financial institution. We need to resurrect that public funding engine today, not only to address the national and global crises we are facing now but for the ongoing development the country needs in order to manifest its true potential.

© 2019 TruthDig

And a child shall lead them


The wolf also shall dwell with the lamb, and the leopard shall lie down with the kid; and the calf and the young lion and the fatling together; and a little child shall lead them.
Isaiah 11:6 King James Version (KJV)

Most of the scientists I rely on for climate change news are old codgers like myself. They are folks who have devoted their lives to finding the most accurate information their precision instruments can reveal. Great people but there is a bit of "whew, we aren't going to have to deal with the end game ourselves—but folks, it will be really ugly" in their approach. So to read about the young Swedish activist who believes that she has most of her life ahead of her and doesn't want fools to screw up her possibilities, is like breath of fresh air.

I have boldfaced the parts I believe are especially perceptive. There may be hope for the next generation, after all. It is the job of us old codgers to give the young the best roadmap possible for what has, and has not, worked in the past when it comes to social change. And yes, I take this as a mandate. Go Greta!




The Swedish 15-year-old who's cutting class to fight the climate crisis


Following Sweden’s hottest summer ever, Greta Thunberg decided to go on school strike at the parliament to get politicians to act

David Crouch in Stockholm, 1 Sep 2018

Why bother to learn anything in school if politicians won’t pay attention to the facts?

This simple realization prompted Greta Thunberg, 15, to protest in the most effective way she knew. She is on strike, refusing to go to school until Sweden’s general election on 9 September to draw attention to the climate crisis.

Her protest has captured the imagination of a country that has been struck by heatwaves and wildfires in its hottest summer since records began 262 years ago.

Every day for two weeks, Thunberg has been sitting quietly on the cobblestones outside parliament in central Stockholm, handing out leaflets that declare: “I am doing this because you adults are shitting on my future.”

Thunberg herself is a diminutive girl with pigtails and a fleeting smile – not the stereotypical leader of a climate revolution.

“I am doing this because nobody else is doing anything. It is my moral responsibility to do what I can,” she says. “I want the politicians to prioritize the climate question, focus on the climate and treat it like a crisis.”

When people tell her she should be at school, she points to the textbooks in her satchel.

“I have my books here,” she says in flawless English. “But also I am thinking: what am I missing? What am I going to learn in school? Facts don’t matter any more, politicians aren’t listening to the scientists, so why should I learn?”

Thunberg’s protest might come as a surprise to anyone seduced by Sweden’s reputation as a climate pioneer and champion of the environment. This year the country enacted “the most ambitious climate law in the world”, aiming to become carbon neutral by 2045 and comfortably beating the 2015 Paris climate targets along the way.

“This is too little too late, it needs to come much faster,” Thunberg says. “Sweden is not a green paradise, it has one of the biggest carbon footprints.”

Her parents want her to give up her protest and go back to school. “My teachers are divided,” Thunberg says. “As people they think what I am doing is good, but as teachers they say I should stop.”

One teacher to have downed tools to join her protest is Benjamin Wagner, 26. He expects to lose three weeks’ wages – and his job – as a result of his strike.

“Our inability to stop climate change is like the efforts to stop world war one – we knew for years it was coming, they arranged all sorts of conferences, but still they didn’t prevent it,” Wagner says.

“Greta is a troublemaker, she is not listening to adults. But we are heading full speed for a catastrophe, and in this situation the only reasonable thing is to be unreasonable.”

There are signs that more Swedes are listening. The Green party, a partner in the centre-left coalition government, was languishing in the polls before the country was hit by more than 60 forest fires, which raged for weeks through a rural tinderbox created by the unprecedented drought. Now the party’s support is up by half to about 6%.

“I am very impressed by Greta’s courage and determination,” says Janine Alm Ericson, a Green member of parliament.

“But I am also sad that she feels she has to be there – the political parties in Sweden have not done enough. Thanks to the hot summer it has become easier for people to imagine what climate change can mean for us and others in Europe if we continue to ignore what is happening.”

Outside parliament, Stella d’Ailly, 45, an art director, has come to join Thunberg’s protest.

“I feel like I am dying inside if I don’t protest,” she says. “Sweden may be well organized to recycle our trash, for example, but we do nothing to cut the amount of plastic bottles and packaging in the first place. We need drastic change.”

Thunberg’s own awakening to the climate crisis a few years ago caused upheaval in her family. Her mother, the well known opera singer Malena Ernman, has given up her international career because of the climate effects of aviation.

“Greta forced us to change our lives,” says her father Svante. “I didn’t have a clue about the climate. We started looking into it, reading all the books – she has read them too.”Her teachers were telling her to turn off the lights and save paper, then flying off to New York for a holiday." For Greta, this was just not good enough: “Everyone believes that we can solve the crisis without effort, without sacrifice,” she wrote in an article widely circulated on social media and translated into English.

While on strike, she has done a lot of homework and read three books, her father says.

“She is supposed to be in school, we cannot support her action. But we respect that she wants to make a stand. She can either sit at home and be really unhappy, or protest and be happy.”

Greta has Asperger’s syndrome, which in the past has affected her health, he says. She sees her condition not as a disability but as a gift which has helped open her eyes to the climate crisis.

“The best thing about my protest has been to see how more and more people have been coming and getting involved,” Greta says.

“I don’t care if I get into trouble at school. I believe that one person can make a difference.” more

What happens with the new round of sanctions aimed at Russia


Regular readers already know the party line around here is that sanctions have proved very beneficial to the Russian economy because they cut off the country from the worst of the neoliberal economic advice that shows up with integration into the global Washington Consensus institutions. The economics of self-sufficiency has again produced superior results.

One of the details about Russia I learned in 1972 on a tour of Leningrad was that she had within her borders commercial supplies of every element on the periodic table. When I heard that, the thought crossed my mind "if this country could get rid of their economic crackpots, it would be easily the richest country on earth."

Alexander Mercouris presents an informed argument for why Russia is well-prepared for another round of USA sanctions.

Producer v Predator—a battle of Titans


The news that Elon Musk wants to take Tesla private has provided us with a further confirmation of Veblen's class theories. Musk is such an excellent example of a Producer Class Superstar, we should probably be selling a Musk bobble-head doll around here. And he has just pulled off a production miracle. And honestly, he looks terrible—120 hour workweeks will do this to a now middle-aged man. And so he looks up from that effort and discovers that a bunch of Predators are trying to suck out the energy from Tesla by shorting the stock.

My pioneer forebears discovered this grim reality while trying to farm in Minnesota. It was like going on a camping trip to hell. With small children in tow. Winters featuring -30° temps, summers with incredible heat and swarms of biting insects, the problems of breeding animals and sowing crops, and 100 other similar annoyances. And when you had survived that, you had to deal with crazy shipping fees by a railroad monopoly, crooked grain grading systems, usurious money-lenders, and the corrupt politicians bought by those thieves. The producing classes had to organize politically. In Wisconsin it was LaFollette and the Progressive Republicans, in North Dakota is was the Non-Partisan League, and here in Minnesota, it was the Farmer-Labor Party. In fact, nearly all the prairie farm states had  political movements to protect the interests of the Producing classes.

Musk vs the Wall Street crooks will be a titanic showdown. Wall Street is on at least a 45-year winning streak. Musk has been taunting the shorts for several years. Musk does not have a political movement backing him—in fact what he does know about the Producer-Predator conflicts seem to be self-taught. But Musk has a LOT going for him. He has that ultimate Producer skill—vision and the organizational abilities to turn his visions into reality. That skill is so rare that people who possess it attract followers. And Musk has a bunch of them. Does he have enough to take Tesla private at $420 per share? We will see.