Majorityrights News > Category: U.S. Politics

Chairman of the Federal Reserve Jerome Powell. (Patrick Semansky / AP)

The Disaster of Negative Interest Rates

By Ellen Brown for TruthDig.org, 25 Sept 2019:

The dollar strengthened against the euro in August, merely in anticipation of the European Central Bank slashing its key interest rate further into negative territory. Investors were fleeing into the dollar, prompting President Trump to tweet on Aug. 30:

Donald J. Trump @realDonaldTrump

The Euro is dropping against the Dollar “like crazy,” giving them a big export and manufacturing advantage…and the Fed does NOTHING! Our Dollar is now the strongest in history. Sounds good, doesn’t it? Except to those (manufacturers) that make product for sale outside the U.S.

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When the ECB cut its key rate as anticipated, from a negative 0.4% to a negative 0.5%, the president tweeted on Sept. 11:

Donald J. Trump @realDonaldTrump

The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term. We have the great currency, power, and balance sheet…..

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And on Sept. 12 he tweeted:

Donald J. Trump @realDonaldTrump

European Central Bank, acting quickly, Cuts Rates 10 Basis Points. They are trying, and succeeding, in depreciating the Euro against the VERY strong Dollar, hurting U.S. exports…. And the Fed sits, and sits, and sits. They get paid to borrow money, while we are paying interest!

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However, negative interest rates have not been shown to stimulate the economies that have tried them, and they would wreak havoc on the U.S. economy, for reasons unique to the U.S. dollar. The ECB has not gone to negative interest rates to gain an export advantage. It is to keep the European Union from falling apart, something that could happen if the United Kingdom does indeed pull out and Italy follows suit, as it has threatened to do. If what Trump wants is cheap borrowing rates for the U.S. federal government, there is a safer and easier way to get them.

The Real Reason the ECB Has Gone to Negative Interest Rates

Why the ECB has gone negative was nailed by Wolf Richter in a Sept. 18 article on WolfStreet.com. After noting that negative interest rates have not proved to be beneficial for any economy in which they are currently in operation and have had seriously destructive side effects for the people and the banks, he said:

“However, negative interest rates as follow-up and addition to massive QE were effective in keeping the Eurozone glued together because they allowed countries to stay afloat that cannot, but would need to, print their own money to stay afloat. They did so by making funding plentiful and nearly free, or free, or more than free.

This includes Italian government debt, which has a negative yield through three-year maturities. … The ECB’s latest rate cut, minuscule and controversial as it was, was designed to help out Italy further so it wouldn’t have to abandon the euro and break out of the Eurozone.

The U.S. doesn’t need negative interest rates to stay glued together. It can print its own money.”

EU member governments have lost the sovereign power to issue their own money or borrow money issued by their own central banks. The EU experiment was a failed monetarist attempt to maintain a fixed money supply, as if the euro were a commodity in limited supply like gold. The central banks of member countries do not have the power to bail out their governments or failing local banks as the Fed did for US banks with massive quantitative easing after the 2008 financial crisis. Before the Eurozone debt crisis of 2011-12, even the European Central Bank was forbidden to buy sovereign debt.

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What provokes this question, of course, is the speech’s heavy emphasis on putting the civic nation of America fist, ZOG-ed out as it is, with other European national leaders commended to put their nations first, as well, though most are now good and fucked in terms of immigrant numbers. That is, plain “nationalism” will be too soft to deal with ethnonational requirements - which entail not just immigration limitation, but large scale deportation and coordination over the problems that created the migratory gluts.

Furthermore, this call for nationalism does little to curb the misallocated fervor of America’s Evangelical Christian Zionists, a hugely problematic demographic to White interests - a demographic instrumental to Israeli Operation Clean Break, A.K.A. “Project For a New American Century” which has used the American military to effect regime change around Israel, beginning with Iraq and now taking aim at Iran and Syria.

In terms of domestic politics, Ethnonationalists might see the same creators of the problem and reaction now proposing a solution - while posed with more of a (((paleocon))) rather than (((neocon))) flavor, the problem - demographic - is baked in the cake and its instigators can present themselves as reasonable nationalists, thusly obstructing radical solutions while the problem manifests fully in a veritable Christian-cucked and civic nationalist holding pattern.

Nevertheless, as ethnonationalists, we might parlay the world-promulgated talking points that are in line with our interests and take advantage of their potential for much needed normalization and institutionalization after decades of international liberalization of our borders and bounds.

Trump speaks at 74th Session of the UN General Assembly, 24 Sept 2019:

“The free world must embrace its national foundations. It must not attempt to erase them or replace them. Looking around, and all over, this large, magnificent planet, the truth is plain to see, if you want freedom take pride in your country. If you want democracy, hold on to your sovereignty, and if you want peace, love your nation. Wise leaders always put the good of their people and their own country, first. The future does not belong to globalists. The future belongs to patriots. The future belongs to sovereign and independent nations, who protect their citizens, respect their neighbors and honor the differences that make each country special and unique.

[...]

One of our most critical challenges is illegal immigration, which undermines prosperity, rips apart societies and empowers ruthless criminal cartels. Mass illegal immigration is unfair, unsafe and unsustainable for everyone involved. .... yet here in the United States and around the world there is a growing cottage industry of radical activists and non-governmental organizations that promote human smuggling. These groups encourage illegal migration and demand erasure of national borders. Today I have a message for those open border activists, who cloak themselves in the rhetoric of social justice. Your policies are not just. Your policies are cruel and evil. You are empowering criminal organizations that prey on innocent men women and children. You put your own false sense of virtue before the lives and well being of countless innocent people. When you undermine border security, you are undermining human rights and human dignity.

Many of the countries here today are coping with the challenges of uncontrolled migration. Each of you has the absolute right to protect your borders; and so, of course, does our country. Today, we must resolve together to end human smuggling, end human trafficking, and put these criminal networks out of business for good. To our country, I can tell you that we are working closely with our friends in the region, including Mexico, Canada, Guatemala, Honduras, El Salvador and Panama, to uphold the integrity of borders and ensure safety and prosperity for our people. I would like to thank Lopez Obrador of Mexico, for the great cooperation we are receiving; and for right now, putting 27,000 troops on our southern border.

[...]

The American people are absolutely committed to restoring balance to our relationship with China. Hopefully we can reach an agreement that will be beneficial for both countries. But as I have made very clear. I will not accept a bad deal for the American people.

[...]

The United States does not seek conflict with any other nation. We desire peace, cooperation and mutual gain with all. But I will never fail to defend America’s interests. One of the greatest security threats facing peace-loving nations in the world today is the repressive regime in Iran.

The regimes’ record of death and destruction is well-know to us all. Not only is Iran the world’s number one state sponsor of terrorism, but Iran’s leaders are fueling the tragic wars in both Syria and Yemen. At the same time, the regime is squandering the nature’s wealth and future in a fanatical quest for nuclear weapons and a means to deliver them. We must never allow this to happen; to stop Iran’s path to nuclear weapons and missiles I withdrew the Unites States from the terrible Iran nuclear deal, which has very little time remaining; which did not allow for the inspection of important sites and did not cover ballistic missiles. Following our withdrawal, we have implemented severe economic sanctions on the country; hoping to free itself from sanctions, the regime has escalated its violent and unprovoked aggression; in response to Iran’s recent attack on Saudi Arabia’s oil facilities we just imposed the highest level of sanctions on Iran’s central bank and sovereign wealth fund; all nations have a duty to act, no responsible government should subsidize Iran’s blood lust. As long as Iran’s menacing behavior continues, sanctions will not be lifted, they will be tightened.

Iran’s leaders will have turned a proud nation into just another cautionary tale of what happens when a ruling class abandons its people and embarks upon a crusade for personal power and riches. For 40 years the world has listened to Iran’s rulers as they lash-out at everyone else for the problems they alone have created. They conduct ritual chants of “death to America” and traffic in monstrous anti-Semitism. Last year, the country’s supreme leader stated Israel is a malignant cancerous tumor that has to be removed and eradicated. It is possible and it will happen. America will never tolerate such anti-Semitic hate. Fanatics have long used hatred of Israel to distract from their own failures.

[...]

The dictator, Maduro, is a Cuban puppet, protected by Cuban body guards, hiding from his own people, while Cuba plunders Venezuela’s oil wealth to sustain its own corrupt communist rule.

[...]

We will find more beautiful friendship and more harmony among nations than ever before. My fellow leaders, the path to peace and progress and freedom and justice and a better world for all humanity begins at home. Thank you, God bless you, God bless the nations of the world and God bless America. Thank you very much.”

The USA, particularly as its become more and more ZOG-ed, has a pretty good record for death and destruction too.

John Bolton Is Gone. The Threat of War Is Not.

BY JOHN FEFFER for Jacobin, 21 Sept 2019:

John Bolton has exited the Trump White House. But his bellicose, bloodthirsty worldview is still the basic operating system of the Trump administration — and still threatens to lead us into war.

John Bolton tried his best.

The national security advisor entered the Trump administration as a predictable warmonger with an unslakable thirst for power. He streamlined the national security apparatus to maximize his access to the president. At least at first, he played the role of loyal adjutant to Trump. As in his days as an arms control official in the George W. Bush administration, Bolton quietly planted IEDs on the inside rather than throw bombs from the outside.

But ultimately, like the scorpion that stings the frog halfway across the river, Bolton couldn’t betray his own nature. In his eagerness to start wars with Venezuela, North Korea, and Iran, Bolton spoke out of turn, publicly clashed with his boss, and probably leaked information to the press. By August his position had become untenable, and he suffered the fate of so many Trump collaborators: expulsion by tweet.

Looked at another way, however, Bolton accomplished what he set out to do. He scuttled the negotiations with North Korea by referring to the Libyan example of denuclearization (Pyongyang knew full well what happened to Muammar Gaddafi’s regime). He made sure that US troops remain in Syria and in Afghanistan as well. He put the fear of a coup in the heart of Nicolás Maduro in Venezuela. And he ratcheted up the pressure on Iran to the point of near-conflict.

Now, with Trump declaring that the United States is “locked and loaded” in the wake of the attacks on Saudi Arabia’s oil supplies, Bolton is no doubt pleased at the prospect of his wildest dream fulfilled: a war with Iran. He nearly pushed the president into military action against Tehran back in June when Trump self-reportedly stopped the strike ten minutes before it was scheduled to take place.

This time, thanks in part to the work of the not-so-dearly-departed Bolton, the president might go over the edge this time.

Or perhaps Trump will stick to his pattern of making outlandish threats and then turning around to negotiate. The administration has more recently been dialing back its rhetoric. Maybe Bolton the scorpion has managed only to sting himself.

The Latest Incident

Secretary of State Mike Pompeo has accused Iran of attacking the Aramco oil facilities in Khurais and Abqaiq in the heart of Saudi Arabia. Saudi and US investigators have reportedly determined that the September 14 attacks came from an Iranian base near the border with Iraq. But the force that has claimed responsibility for the attacks are the Houthis, who have been battling a Saudi-led coalition in Yemen for more than four years.

On the face of it, the obvious culprit would be the Houthis. Over the last month, they have repeatedly launched aerial attacks on Saudi facilities: a drone attack on the Shaybah oil field on August 16, a missile attack against Jizan airport on August 26, a drone attack against Riyadh on August 27, and a failed drone attack on September 3.

Also, as Kate Kizer of Win Without War points out, the Saudis and the Houthis have been engaged in a tit-for-tat game of aerial bombardment. The latest attacks on Saudi oil facilities could very well be a response to the Saudi air strike on Dhamar prison, which killed one hundred people two weeks ago.

Tit-for-tat doesn’t, however, mean that it’s been an equal contest. The Saudi campaign has killed thousands and thousands of Yemenis. Houthi attacks have resulted mostly in material damage and four civilian casualties.

Those who point the finger at Iran argue that this latest attack was far from the border with Yemen. But the Khurais oil field (the most recent target) and Shaybah oil field (hit in mid-August) are both about the same distance from the Yemen border.

The latest attacks were also remarkably successful. The pinpoint strikes forced the suspension of more than half of Saudi oil production. But the Houthis have steadily increased their offensive capabilities, attacking Saudi airports at Jizan and Abha in May and June a total of seventeen times. They’ve received some weaponry from Iran but also have some Soviet-era missiles as well as some from North Korea. They are now operating air defense systems as well.

Meanwhile, it’s rather difficult to imagine the Iranian government launching such an attack just after Secretary of State Mike Pompeo had talked of Trump possibly meeting Iranian president Hassan Rouhani at the UN General Assembly in New York this week. Even if the Iranian authorities are reluctant to sit down with Trump, for understandable reasons, attacking Saudi Arabia on the eve of the UN meeting doesn’t make much strategic sense.

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John Mearsheimer, The Roots of Liberal Hegemony, Yale University speech, published 22 Nov 2017.

       

(17:54): I just want to be clear, that if we’re going to [be talking about] liberalism, we’re talking about at home, not liberalism abroad; and with regard to nationalism, I’m not making the argument that nationalism is this wonderful force all the time.

Okay. Roots of liberal hegemony - the talk tonight. As I said, you’ve got to start with human nature, that was my chapter two. And when you talk about human nature, really what you’re asking is, ‘what are those common traits that all individuals have in common?’

And by the way, this is something that the founding fathers of liberalism paid enormous attention-to.

I believe that if you’re going to think about liberalism and nationalism, you have to wrestle with these questions.

And there are two big questions:

1) The first question is, ‘are men and women social beings above all else or does it make more sense to emphasize their individuality? In other words, are humans fundamentally social animals, who strive hard to carve out room for their individuality, or are they individuals who form social contracts?

That’s question number one.

2) Question number two, second, have our critical faculties developed to the point where we can reach universal consensus, on what defines the good life - can we agree on first principles?

Can we use reason? Are we able to reason our way through collectively and come to meaningful agreement on the big questions about life?

Those are sort of the two big issues on the table when you think about human nature.

Now, my views on this subject are that human beings are primarily social animals. We’re born into societies. We’re born into groups; and we are heavily socialized inside those groups, both by the family and the society around us in a really big way before our individuality gets to assert itself.

I think human beings are very tribal, to put it in simplistic terms from the get go - that’s not to say that you can’t have a lot of individualism but we’re primarily social animals.

Secondly, I think it’s near impossible to reach universal consensus about questions about the good life.

I agree with Mearsheimer that socialization is primary, that we are primarily social animals. That is the human condition, should be considered the preliminary outlook and matter of negotiation - failing that sufficiently, the individual and their truth will not even survive - they become, thereby, a moot point, not even there to argue how facts count.

However, I don’t think the tribal designation is good short hand - that may have been the practical social survival unit historically, but eventually it became too small and the national social scale has become the optimal unit of survival for various practical reasons.

But coming back to the second question, of whether common grounds and recognition of the shared good between people can be established, Mearsheimer frames it wrong in the sense of looking for any sort of elaborate, universal agreement between nations.

The goal, rather, should be more modest, namely of coordination, enough recognition of common interests, self and other national interests to be able to function non conflictually.

Coordination is geared toward facilitating groups functioning in their own interests with minimal conflict as opposed to trying to achieve thorough cooperation in details that do not bear on capacity for coordination or interfere with the common good.

I do need to call your attention to the fact that there is a constellation of right wingers out there who will seize upon ANYTHING, often superficial matters, in order to distract from what I have to say (which is a coherent and complete enough platform in advocacy of European peoples; I can defend and explain anything that I say).

These people are usually antagonistic to me and the ideas that I put forth because they are committed to Christianity, to Hitler, or to the inclusion of Jews in our advocacy group..and sometimes it is reactionary scientism and egotism that has them averse to the integration of ideas which are very necessary to understand for the good of our people.

Let me say briefly, that coordination of human and pervasive ecology is a large concept which I table. Conducted according to White Post Modern understanding, it is grounds that people of any thought and decency should be able to agree upon to facilitate the survival and coordination of our distinct peoples.

However, these right wing commitments, part and parcel of modernity, run rough shod over coordination to an extent that even the most ethnocentric of tradition could never be capable of.

The first project then, getting people, Europeans anyway, especially northern Europeans, perhaps, to appreciate our social nature from the onset is somewhat difficult for the reasons that:

A) They/we are evolved somewhat more individualistically as we were more evolved against the challenges of nature rather than the challenges of other groups forcing us to band together.

B) This has been fetishized in our modernist quest for pure objective warrant and the reward of its scientific/technological yields, its grandiose moral claims beyond utility to relative social group interests, either beyond nature or in laws thereof; also tending to be narcissistically extended beyond the boundaries, discrimination and prerogatives of other groups - modernity runs rough shod over coordination for its failure to recognize differences while traditional ethnocentrism at least recognized the concept of non-natives, outsiders.

C) However, this objectivity has been somewhat spurned on by Christianity, itself introduced by YKW while the purity quest was weaponized further against Whites by YKW - exacerbated Alinsky style, viz. White Americans being instigated to live up to the anti-social (anti White social) Cartesian purity of Lockeatine individual civil rights against “racism” - i.e., prejudiced against the relative group interests of Whites, with boundaries and discrimination thereupon for Whites.

Furthermore, the Abrahamic religions tend to run rough shod over coordination as they insist upon one god, and tend to be narcissistic, disregarding the significance of national differences

D) To make matters worse, whatever socially organizing and qualitative niche advocating correctives to this universalism and individualism that were introduced through (((academia))), tended to be made didactic for Whites by being exaggerated or misrepresented so that Whites would react against the very corrective that they needed for organization and defense of their social systemic homeostasis - this is where we are at now with all this railing against “the left” and “its failure to deal with reality” its “social justice warring” and various other straw man characterizations of THE Leftist, “his call for equality”, “fifty eight genders”, trannies reading to children in libraries and in paradox to the profoundly leftist call for unionization mislabled a call for “liberalism.” This “scourge of ‘identity politics’, when we should all be American.”

There was/is a call for liberalism within the nation, in the sense of doing away with the strict aristocratic class system that England has had since 1066, but the union of England does not mean giving up its borders, it means a union of the English people, whether they had been so called aristocracy or working class.

Bateson calls this “paradigmatic conservatism” - strong borders of the group, but relative freedom of individuality as facilitated by group security. He felt, as I do, that that’s the way it should be but that the reverse is more and more the case - group borders are being forced open to run wild and individualism is getting pegged, put in a straight jacket.

.....

Mearsheimer argues against trying to impose liberal democracy - a post modern turn away from universalism well advised - as it is necessarily a failed foreign policy against staunch nationalism, but he defends “liberal democracy” as a good way of life for The US.

However, he does not observe that The U.S. has failed democratic principle in important ways - notably in the open border/ opening of group boundaries policies in exploit of the “civic nationalist” concept that his YKW people have perpetrated through power niches in cahoots with liberals/right wingers to overturn democratic will (for closed borders) ..open borders and boundaries, weakening The United States nationhood and putting The U.S. effectively, on a trajectory of non-nationhood.

Note Mearsheimer’s use of the pejorative word “purportedly” when discussing nationalist claims to distinguish their people in ways (e.g., important biological differences) requiring a nation-state to protect their differences; i.e., that they are only “purportedly” different from other people in significant ways which require national boundaries/borders to protect them.

Nevertheless, in places, Mearsheimer makes the point, quite eloquently, that people are social, very profoundly social, from the start; thus making nationalism as it protects their sociality something they care about more deeply than liberal democracy. They will defend more ardently the security, social order and stability that provides for general fairness and just recourse against the secondary priorities, bullying ‘prerogatives’ of individual liberal choice over the security of group interests. Noting our deep social nature (including Europeans) from the start is correct, and is the point of correction that Whites need to understand and prioritize as opposed to right wing reaction (itself a species of liberalism) reaction to Jewish didacticism.

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House Oversight Subcommittees hold hearing on ‘Confronting Violent White Supremacy

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Prosecutorial Elite Proffering: Well Organized (But Irrational!) White Defense To Tie-In Lone Wolves

Reflecting on his decision to go public with classified information, Snowden says, “The likeliest outcome for me, hands down, was that I’d spend the rest of my life in an orange jumpsuit, but that was a risk that I had to take.” Courtesy of Edward Snowden

Edward Snowden Speaks Out: ‘I Haven’t And I Won’t’ Cooperate With Russia

19 Sept 2019, Dave Davies interviews Edward Snowden for Fresh Air (Audio)

In 2013, Snowden was an IT systems expert working under contract for the National Security Agency when he traveled to Hong Kong to provide three journalists with thousands of top-secret documents about U.S. intelligence agencies’ surveillance of American citizens.

To Snowden, the classified information he shared with the journalists exposed privacy abuses by government intelligence agencies. He saw himself as a whistleblower. But the U.S. government considered him a traitor in violation of the Espionage Act.

After meeting with the journalists, Snowden intended to leave Hong Kong and travel — via Russia — to Ecuador, where he would seek asylum. But when his plane landed at Moscow’s Sheremetyevo International Airport, things didn’t go according to plan.

“What I wasn’t expecting was that the United States government itself ... would cancel my passport,” he says.

Archived Author Interview

Edward Snowden Tells NPR: The Executive Branch ‘Sort Of Hacked The Constitution’

Snowden was directed to a room where Russian intelligence agents offered to assist him — in return for access to any secrets he harbored. Snowden says he refused.

“I didn’t cooperate with the Russian intelligence services. I haven’t and I won’t,” he says. “I destroyed my access to the archive. I had no material with me before I left Hong Kong, because I knew I was going to have to go through this complex multi-jurisdictional route.”

Snowden spent 40 days in the Moscow airport, trying to negotiate asylum in various countries. After being denied asylum by 27 nations, he settled in Russia, where he remains today.

“People look at me now and they think I’m this crazy guy, I’m this extremist or whatever. Some people have a misconception that I set out to burn down the NSA,” he says. “But that’s not what this was about. In many ways, 2013 wasn’t about surveillance at all. What it was about was a violation of the Constitution.”

NATIONAL SECURITY

Justice Department Sues Edward Snowden, Seeking Profits From His Book

Snowden’s 2013 revelations led to changes in the laws and standards governing American intelligence agencies and the practices of U.S. technology companies, which now encrypt much of their Web traffic for security. He reflects on his life and his experience in the intelligence community in the memoir Permanent Record.

On Sept. 17, the U.S. Justice Department filed suit to recover all proceeds from the book, alleging that Snowden violated nondisclosure agreements by not letting the government review the manuscript before publication; Snowden’s attorney, Ben Wizner, said in a statement that the book contains no government secrets that have not been previously published by respected news organizations, and that the government’s prepublication review system is under court challenge.

Interview Highlights

On how researching China’s surveillance capabilities for a CIA presentation got him thinking about the potential for domestic surveillance within the U.S.

I’m invited to give a presentation about how China is hacking the United States intelligence services, defense contractors, anything that we have available in the network, which I know a little bit about but not that much about, because they have the person who is supposed to be giving the presentation drop out. So I go looking ... seeing what exactly is it that China is doing? What are their capabilities? Are they hacking? Are they doing domestic surveillance? Are they doing international surveillance? What is occurring?

And I’m just shocked by the extent of their capabilities. I’m appalled by the aggression with which they use them. But also, in a strange way, surprised by the openness with which they use them. They’re not hiding it. They’re just open and out there, saying, “Yeah, we’re doing this. Yeah, we’re hacking you. What are you going to do about it?”

And I think this is a distinction: I think, yes, the NSA is spying — of course they’re spying — but we’re only spying overseas, we’re not spying on our guys at home. We wouldn’t do that. We have firewalls, we have trip wires for people to hit. But surely these are only affecting terrorists, because we’re not like China. But this plants the first seeds of doubt where I see if the capability is there.

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Trump and his cyber ‘czar’ Giuliani want to outsource US cybersecurity. Can you guess where-to?

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Image: Eli Christman / CC BY 2.0

Central Bankers’ Desperate Grab for Power

By Ellen Brown for TruthDig.Org, 17 Sept 2019:

Central bankers are out of ammunition. Mark Carney, the soon-to-be-retiring head of the Bank of England, admitted as much in a speech at the annual meeting of central bankers in Jackson Hole, Wyo., in August. “In the longer-term,” he said, “we need to change the game.” The same point was made by Philipp Hildebrand, former head of the Swiss National Bank, in a recent interview with Bloomberg. “Really, there is little if any ammunition left,” he said. “More of the same in terms of monetary policy is unlikely to be an appropriate response if we get into a recession or sharp downturn.”

“More of the same” means further lowering interest rates, the central bankers’ stock tool for maintaining their targeted inflation rate in a downturn. Bargain-basement interest rates are supposed to stimulate the economy by encouraging borrowers to borrow (since rates are so low) and savers to spend (since they aren’t making any interest on their deposits and may have to pay to store them). At the moment, over $15 trillion in bonds are trading globally at negative interest rates, yet this radical maneuver has not been shown to measurably improve economic performance. In fact, new research shows that negative interest rates from central banks, rather than increasing spending, stopping deflation and stimulating the economy as they were expected to do, may be having the opposite effects. They are being blamed for squeezing banks, punishing savers, keeping dying companies on life support and fueling a potentially unsustainable surge in asset prices.

So what is a central banker to do? Hildebrand’s proposed solution was presented in a paper he wrote with three of his colleagues at BlackRock, the world’s largest asset manager, where he is now vice chairman. Released in August to coincide with the annual Jackson Hole meeting, the paper was co-authored by Stanley Fischer, former governor of the Bank of Israel and former vice chairman of the U.S. Federal Reserve; Jean Boivin, former deputy governor of the Bank of Canada; and BlackRock economist Elga Bartsch. Their proposal calls for “more explicit coordination between central banks and governments when economies are in a recession so that monetary and fiscal policy can better work in synergy.” The goal, according to Hildebrand, is to go “direct with money to consumers and companies in order to enliven consumption,” putting spending money directly into consumers’ pockets.

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Austrian School Economics at Work: The Subsidiarity of Times Beach Dioxin Disposal

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