The 2.6 Billion Dollar Welfare Payment That The U.S. Government Gives To Wal-Mart

Wal-Mart Should the federal government be spending billions of dollars to pump up Wal-Mart’s profits?  I know that question sounds really bizarre, but unfortunately this is essentially what is happening.  Because Wal-Mart does not pay them enough money, hundreds of thousands of Wal-Mart employees enroll in Medicaid, food stamps and other social welfare programs.  Even though Wal-Mart makes enormous profits, they refuse to properly take care of their employees so the federal government has to do it.  And of course this is not just a Wal-Mart problem.  There are hundreds of other major corporations doing exactly the same thing.  And they will keep on doing it as long as they can because relying on the federal government to take care of their employees allows them to make much larger profits.  This gives these companies an enormous competitive advantage and it distorts the marketplace.  If you love the free enterprise system, you should be aghast at this.  Our big corporations have become the biggest “welfare queens” of all, and Wal-Mart is near the top of that list.

Does your local Wal-Mart store seem like it needs help from the federal government?

Of course not.

Wal-Marts all over the nation were absolutely packed this holiday season, but according to a recent Bloomberg article, the average amount of welfare that Wal-Mart employees receive from the government each year breaks down to about $420,000 per store…

Wal-Mart’s low wages have led to full-time employees seeking public assistance. These are not the 47 percent, lazy, unmotivated bums. Rather, these are people working physical, often difficult jobs. They receive $2.66 billion in government help each year (including $1 billion in healthcare assistance). That works out to about $5,815 per worker. And about $420,000 per store.

Does that make you angry?

It should.

Today, Wal-Mart employs approximately 1.2 million people in the United States, and it makes a yearly profit of about 17 billion dollars.

So why does it need 2.6 billion dollars of help from the U.S. government?

Wal-Mart is a colossal money-making behemoth.  Just consider the following numbers

The size of Wal-Mart is sometimes difficult to visualize. To put it into some context, consider the following: 100 million U.S. shoppers patronize Wal-Mart stores every week. Wal-Mart has twice the number employees of the U.S. Postal Service, a larger global computer network than the Pentagon, and the world’s largest fleet of trucks. Americans spend about $36 million dollars per hour at the stores. Wal-Mart now sells more food than any other company in the world, capturing one of every four dollars spent on food in the U.S. The average American family of four spends over $4,000 a year there. Each week, it has 200 million customers at more than 10,400 stores in 27 countries. If the company were an independent country, it would be the 25th largest economy in the world.

Wal-Mart does well enough to be able to pay their workers a livable wage.

And yet they refuse to do it.

Shame on them.

Meanwhile, the six heirs of Wal-Mart founder Sam Walton have as much wealth as the poorest one-third of all Americans combined.

This reminds me of something that I read in the fifth chapter of James the other day…

Come now, you rich men, weep and howl for your miseries that shall come upon you.  Your riches are corrupted and your garments are moth-eaten.  Your gold and silver are corroded, and their corrosion will be a witness against you and will eat your flesh like fire. You have stored up treasures for the last days.  Indeed the wages that you kept back by fraud from the laborers who harvested your fields are crying, and the cries of those who harvested have entered into the ears of the Lord of Hosts.  You have lived in pleasure on the earth and have been wayward. You have nourished your hearts as in a day of slaughter.

But we continue to reward this behavior, don’t we?

100 million of us continue to visit Wal-Mart every single week, and we continue to fill up our shopping carts with cheap products that are made outside this country.

We refuse to support American workers and American businesses, and this is a recipe for utter disaster.  For much more on this, please see my previous article entitled “National Economic Suicide: The U.S. Trade Deficit With China Just Hit A New Record High“.

The truth is that we cannot consume our way to prosperity.  When we consume far more wealth than we produce, we pile up debt and we become poorer as a nation.

And as a country we have become exceedingly cold-hearted toward our workers.  If you truly love free markets and capitalism, you should be encouraging big companies to pay their workers properly.  Instead, we are moving closer and closer to the slave labor model employed by China and other communist nations with each passing day.  Sadly, I am becoming increasingly convinced that many prominent “pro-business” voices in America today are actually closet communists.  They seem to want everything to be made in China and for American workers to be paid just like Chinese workers.

At this point, the U.S. middle class is well on the way to being destroyed.  As I have written about previously, 40 percent of all American workers now make less than what a minimum wage worker made back in 1968 after you account for inflation.

How is the middle class supposed to survive in such an environment?

And for any “pro-business” people that want to defend Wal-Mart, do you actually like paying suffocating taxes to support all of the people that are being forced on to the safety net?

What is our society going to look like as millions more Americans become dependent on the federal government each year?  Government dependence is already at an all-time record high.  How much worse do things have to get before we admit that we have a real problem?

Unfortunately, it looks like our problems are only going to accelerate in 2015.  Thanks to the stunning decline in the price of oil, we are starting to lose good paying jobs in the energy industry

One company caught in the industry downturn is Hercules Offshore Inc. The Houston-based firm is laying off 324 employees, roughly 15% of its workforce, because oil companies aren’t renewing contracts for its offshore drilling rigs in the Gulf of Mexico while crude prices are depressed.

“It’s been breathtaking,” said Jim Noe, executive vice president of Hercules, which was founded in 2004. “We’ve never seen this glut of supply and dislocation in oil markets. So we’re not surprised to see a significant decline in demand for our services.”

These are jobs that we cannot afford to lose.

Since the end of the last recession, the energy industry has been the leading creator of good paying jobs in America.

But now as the U.S. energy boom goes bust, it might lead the way in job losses.

In order to have a middle class, we have got to have middle class jobs.

Unfortunately, those kinds of jobs are disappearing and the entire U.S. economy is moving toward the Wal-Mart model.

In the end, we will all pay a great price for such foolishness.

 

Obama And Putin Are Trapped In A Macho Game Of “Chicken” And The Whole World Could Pay The Price

Barack Obama Vladimir PutinThe U.S. government and the Russian government have both been forced into positions where neither one of them can afford to back down.  If Barack Obama backs down, he will be greatly criticized for being “weak” and for having been beaten by Vladimir Putin once again.  If Putin backs down, he will be greatly criticized for being “weak” and for abandoning the Russians that live in Crimea.  In essence, Obama and Putin find themselves trapped in a macho game of “chicken” and critics on both sides stand ready to pounce on the one who backs down.  But this is not just an innocent game of “chicken” from a fifties movie.  This is the real deal, and if nobody backs down the entire world will pay the price.

Leaving aside who is to blame for a moment, it is really frightening to think that we may be approaching the tensest moment in U.S.-Russian relations since the Cuban missile crisis.

There has been much talk about Obama’s “red lines”, but the truth is that Crimea (and in particular the naval base at Sevastopol) is a “red line” for Russia.

There is nothing that Obama could ever do that could force the Russians out of Sevastopol.  They will never, ever willingly give up that naval base.

So what in the world does Obama expect to accomplish by imposing sanctions on Russia?  By treaty, Russia is allowed to have 25,000 troops in Crimea and Russia has not sent troops into the rest of Ukraine.

Economic sanctions are not going to cause Putin to back down.  Instead, they will just cause the Russians to retaliate.

In a letter that he sent to Congress this week, Obama claimed that the Ukrainian crisis is an “unusual and extraordinary threat to the national security and foreign policy of the United States.”

Language like that is going to make it even more difficult for Obama to back down.

On Thursday, Obama announced “visa restrictions” on “those Russians and Ukrainians responsible for the Russian move into Ukraine’s Crimean Peninsula”, and a House panel passed a “symbolic resolution” that condemned Russia for its “occupation” of Crimea.

But those moves are fairly meaningless.  Leaders from both political parties are now pushing for very strong economic sanctions against Russia, and there does not appear to be many members of Congress that intend to stand in the way.

If the U.S. does hit Russia with harsh economic sanctions, what is going to happen?

Is Russia going to back down?

No way.

So let’s just play out the coming moves like a game of chess for a moment…

-The U.S. slaps economic sanctions on Russia.

-Russia seizes the assets of U.S. companies that are doing business in Russia.

-The U.S. seizes Russian assets.

-The Russians refuse to pay their debts to U.S. banks.

-The U.S. government hits Russia with even stronger sanctions.

-Russia starts dumping U.S. debt and encourages other nations to start doing the same.

-The U.S. gets Europe to also hit Russia with economic sanctions.

-Russia cuts off the natural gas to Europe.  As I noted the other day, Russia supplies more than half the natural gas to a bunch of countries in Europe.

-The United States moves troops into western Ukraine.

-Russia starts selling oil for gold or for Russian rubles and encourages other nations to start abandoning the U.S. dollar in international trade.

Of course the order of many of these moves could ultimately turn out to be different, but I think that you can see the nightmare that this game of “chicken” could turn out to be.

And what would be the final result?

Nothing would be resolved, but the global economy would greatly suffer.

What makes all of this even more complicated is that about 60 percent of the people living in Crimea are actually ethnic Russians, and a majority of the population appears to want to leave Ukraine and be reunited with Russia.  The following comes from a Reuters article

Crimea’s parliament voted to join Russia on Thursday and its Moscow-backed government set a referendum on the decision in 10 days’ time in a dramatic escalation of the crisis over the Ukrainian Black Sea peninsula.

The sudden acceleration of moves to bring Crimea, which has an ethnic Russian majority and has effectively been seized by Russian forces, formally under Moscow’s rule came as European Union leaders held an emergency summit groping for ways to pressure Russia to back down and accept mediation.

The Obama administration is calling the upcoming referendum “illegal” and says that it will not respect the will of the Crimean people no matter how the vote turns out.

But the people of Crimea are very serious about this, and of course they never would be pushing for reunification with Russia if they had not gotten approval from Putin…

The decision, which diplomats said could not have been made without Putin’s approval, raised the stakes in the most serious east-west confrontation since the end of the Cold War.

The vice premier of Crimea, home to Russia’s Black Sea Fleet in Sevastopol, said a referendum on the status would take place on March 16. All state property would be “nationalized”, the Russian ruble adopted and Ukrainian troops treated as occupiers and forced to surrender or leave, he said.

There is no way that the U.S. government is going to accept Crimea becoming part of Russia, and there is no way in the world that Russia is going to back down at this point.  Just consider what geopolitical expert Ian Bremmer of the Eurasia Group recently had to say

“Russia is not going to back down from Crimea, irrespective of U.S. pressure. Which means if the U.S. wants to find any resolution here, they’re going to have to find a way to come to terms with that. Now that the Crimean parliament has voted — clearly with Russian assent — we’ll have a referendum … and then further militarization of the peninsula by the Russians.”

What we need is someone with extraordinary diplomatic skills to defuse this situation before it spirals out of control.

Unfortunately, we have Barack Obama, Valerie Jarrett and John Kerry running things.

What a mess.

So why is Ukraine such a big deal anyway?

In a recent article, Peter Farmer explained succinctly why Ukraine is so incredibly important…

The Ukraine is strategically-important for a number of reasons. It sits astride enormous petroleum and natural gas deposits found in the Black Sea region. The nation is also home to an extensive network of liquid natural gas pipelines which crisscross it; control the Ukraine and you control its pipelines – and thus the flow of energy into the hugely-lucrative European market. Western energy firms such as Exxon-Mobil, BP-Amoco and Chevron are locked in competition with the Russian energy giant Gazprom – for control/exploitation of as-yet-undeveloped petroleum deposits not only in the Ukraine, but in neighboring Poland and Romania. Fracking technologies and other new extraction methods have only added urgency to the competition. Income from fossil fuels development is the lifeblood of the new Russian economy. Threats to the regional hegemony of Gazprom are likely to be treated by Putin and Russia with the utmost urgency and seriousness.

The Crimean Peninsula is also home to the Black Sea fleet of the Russian navy, which leases its base at Sevastopol from the Ukrainian government. Since the Black Sea – via the Dardanelles – provides the only warm-water base with access to the Mediterranean Sea – it is of enormous importance to Russia. Its loss would be a crippling blow to the Russian fleet.

Finally, the Ukraine – once known as the “bread basket of Europe” – is home to arguably the finest temperate agricultural region in the world. Its topsoil is widely-acknowledged by agronomists to be among the world’s best. Control the Ukraine and you control the grainery of Europe – and can exert tremendous leverage upon worldwide grain agricultural commodities prices.

If the U.S. insists on playing a game of brinksmanship over Ukraine, the consequences could be disastrous.

For one thing, as I mentioned above, the status of the petrodollar could be greatly threatened.  The following is how Jim Willie is analyzing the situation…

If the Kremlin demands Gold bullion (or even Russian Rubles) for oil payments, then the interventions to subvert the Ruble currency by the London and Wall Street houses will backfire and blow up in the bankster faces. Expect any surplus Rubles would be converted quickly to Gold bullion. If the Chinese demand that they are permitted to pay for oil shipments in Yuan currency, then the entire Petro-Dollar platform will be subjected to sledge hammers and wrecking balls. The new Petro-Yuan defacto standard will have been launched from the Shanghai outpost. If the Saudis curry favor to the Russians and Chinese by accepting non-USDollar payments for oil shipments, then the Petro-Dollar is dead and buried.

In addition, if Russia starts dumping U.S. debt and gets other nations (such as China) to start doing the same, that could create a nightmare scenario for the U.S. financial system very rapidly.

So let us hope and pray that cooler heads prevail.

In my recent article entitled “The Top 12 Signs That The U.S. Economy Is Heading Toward Another Recession“, I discussed how the U.S. economy appears to be hurtling toward another major downturn.

And on Thursday, we learned that office supplies giant Staples has just announced that it is going to close 225 stores.

Even without this major international crisis, the U.S. economy would still be deeply troubled.

But if the United States and Russia do declare “economic war” on each other, all hell could start breaking loose.

Unfortunately, there does not appear to be much hope of anyone backing down at this point.  In an editorial for the Washington Post, Henry Kissinger stated that it “is incompatible with the rules of the existing world order for Russia to annex Crimea.”

Very interesting word choice.

So this is the situation we are facing…

-The U.S. government seems absolutely determined to “punish” Russia until it leaves Crimea.

-Russia is never going to leave Crimea, and has promised to “respond” harshly to any sanctions.

Most Americans are not paying much attention to what is going on in Ukraine, but this is a very, very big deal.

In the end, it could potentially affect the lives of virtually every man, woman and child on the planet.

The 441 TRILLION Dollar Interest Rate Derivatives Time Bomb

The Derivatives Time BombDo you want to know the primary reason why rapidly rising interest rates could take down the entire global financial system?  Most people might think that it would be because the U.S. government would have to pay much more interest on the national debt.  And yes, if the average rate of interest on U.S. government debt rose to just 6 percent (and it has actually been much higher in the past), the federal government would be paying out about a trillion dollars a year just in interest on the national debt.  But that isn’t it.  Nor does the primary reason have to do with the fact that rapidly rising interest rates would impose massive losses on bond investors.  At this point, it is being projected that if U.S. bond yields rise by an average of 3 percentage points, it will cause investors to lose a trillion dollars.  Yes, that is a 1 with 12 zeroes after it ($1,000,000,000,000).  But that is not the number one danger posed by rapidly rising interest rates either.  Rather, the number one reason why rapidly rising interest rates could cause the entire global financial system to crash is because there are more than 441 TRILLION dollars worth of interest rate derivatives sitting out there.  This number comes directly from the Bank for International Settlements – the central bank of central banks.  In other words, more than $441,000,000,000,000 has been bet on the movement of interest rates.  Normally these bets do not cause a major problem because rates tend to move very slowly and the system stays balanced.  But now rates are starting to skyrocket, and the sophisticated financial models used by derivatives traders do not account for this kind of movement.

So what does all of this mean?

It means that the global financial system is potentially heading for massive amounts of trouble if interest rates continue to soar.

Today, the yield on 10 year U.S. Treasury bonds rocketed up to 2.66% before settling back to 2.55%.  The chart posted below shows how dramatically the yield on 10 year U.S. Treasuries has moved in recent days…

10 Year Treasury Yield

Right now, the yield on 10 year U.S. Treasuries is about 30 percent above its 50 day moving average.  That is the most that it has been above its 50 day moving average in 50 years.

Like I mentioned above, we are moving into uncharted territory and this data doesn’t really fit into the models used by derivatives traders.

The yield on 5 year U.S. Treasuries has been moving even more dramatically…

5 Year Treasury Yield

Last week, the yield on 5 year U.S. Treasuries rose by an astounding 37 percent.  That was the largest increase in 50 years.

Once again, this is uncharted territory.

If rates continue to shoot up, there are going to be some financial institutions out there that are going to start losing absolutely massive amounts of money on interest rate derivative contracts.

So exactly what is an interest rate derivative?

The following is how Investopedia defines interest rate derivatives…

A financial instrument based on an underlying financial security whose value is affected by changes in interest rates. Interest-rate derivatives are hedges used by institutional investors such as banks to combat the changes in market interest rates. Individual investors are more likely to use interest-rate derivatives as a speculative tool – they hope to profit from their guesses about which direction market interest rates will move.

They can be very complicated, but I prefer to think of them in very simple terms.  Just imagine walking into a casino and placing a bet that the yield on 10 year U.S. Treasuries will hit 2.75% in July.  If it does reach that level, you win.  If it doesn’t, you lose.  That is a very simplistic example, but I think that it is a helpful one.  At the heart of it, the 441 TRILLION dollar derivatives market is just a bunch of people making bets about which way interest rates will go.

And normally the betting stays very balanced and our financial system is not threatened.  The people that run this betting use models that are far more sophisticated than anything that Las Vegas uses.  But all models are based on human assumptions, and wild swings in interest rates could break their models and potentially start causing financial losses on a scale that our financial system has never seen before.

We are potentially talking about a financial collapse far worse than anything that we saw back in 2008.

Remember, the U.S. national debt is just now approaching 17 trillion dollars.  So when you are talking about 441 trillion dollars you are talking about an amount of money that is almost unimaginable.

Meanwhile, China appears to be on the verge of another financial crisis as well.  The following is from a recent article by Graham Summers

China is on the verge of a “Lehman” moment as its shadow banking system implodes. China had pumped roughly $1.6 trillion in new credit (that’s 21% of GDP) into its economy in the last two quarters… and China GDP growth is in fact slowing.

This is what a credit bubble bursting looks like: the pumping becomes more and more frantic with less and less returns.

And Chinese stocks just experienced their largest decline since 2009.  The second largest economy on earth is starting to have significant financial problems at the same time that our markets are starting to crumble.

Not good.

And don’t forget about Europe.  European stocks have had a very, very rough month so far

The narrow EuroStoxx 50 index is now at its lowest in over seven months (-5.4% year-to-date and -12.5% from its highs in May) and the broader EuroStoxx 600 is also flailing lower. The European bank stocks pushed down to their lowest in almost 10 months and are now in bear market territory – down 22.5% from their highs. Spain and Italy are now testing their lowest level in 9 months.

So are the central banks of the world going to swoop in and rescue the financial markets from the brink of disaster?

At this point it does not appear likely.

As I have written about previously, the Bank for International Settlements is the central bank for central banks, and it has a tremendous amount of influence over central bank policy all over the planet.

The other day, the general manager of the Bank for International Settlements, Jaime Caruana, gave a speech entitled “Making the most of borrowed time“.  In that speech, he made it clear that the era of extraordinary central bank intervention was coming to an end.  The following is one short excerpt from that speech…

“Ours is a call for acting responsibly now to strengthen growth and avoid even costlier adjustment down the road. And it is a call for recognizing that returning to stability and prosperity is a shared responsibility. Monetary policy has done its part. Recovery now calls for a different policy mix – with more emphasis on strengthening economic flexibility and dynamism and stabilizing public finances.”

Monetary policy has done its part?

That sounds pretty firm.

And if you read the entire speech, you will see that Caruana makes it clear that he believes that it is time for the financial markets to stand on their own.

But will they be able to?

As I wrote about yesterday, the U.S. financial system is a massive Ponzi scheme that is on the verge of imploding.  Unprecedented intervention by the Federal Reserve has helped to prop it up for the last couple of years, and there is a lot of fear in the financial world about what is going to happen once that unprecedented intervention is gone.

So what happens next?

Well, nobody knows for sure, but one thing seems certain.  The last half of 2013 is shaping up to be very, very interesting.

The Rest Of The World Is Absolutely Disgusted With Our Big Brother Spying Methods

The WorldThe rest of the world has found out that the U.S. government has been listening to their phone calls and watching what they do on the Internet and they do not like it one bit.  Outrage has been pouring in from all over the planet, and one member of the European Parliament is even comparing the NSA to the Stasi.  But instead of stepping back and reevaluating our Big Brother spying methods now that they have been revealed, Barack Obama and other leading members of Congress are defiantly declaring that there is nothing wrong with these methods and that no changes will be made.  The U.S. government is going to continue to invade the privacy of the citizens of the rest of the world as much as it possibly can, and our leaders don’t seem to really care what the international response is.  And make no mistake – the goal of the U.S. intelligence community is to literally know everything about everyone.  The chief technology officer of the CIA, Gus Hunt, made the following shocking admission back in March: “We fundamentally try to collect everything and hang onto it forever.”  He followed that statement up with this gem: “It is really very nearly within our grasp to be able to compute on all human-generated information.”  In other words, they want it all, and they nearly have the capacity to gather it all already.  So where does this end?  Will the U.S. intelligence community ever be happy until they have every piece of data on every single person on the entire planet?  Do we really want a government that collects “everything” and hangs on to it “forever”?

Thanks to Edward Snowden, the rest of the globe is starting to understand the extent to which the U.S. government has been spying on them.  Needless to say, a lot of people are extremely upset about this.

In Germany (a country that knows a thing or two about Big Brother tactics), some prominent politicians are publicly denouncing the surveillance that the U.S. government has been doing on their citizens.  In fact, one German politician has accused the U.S. of employing “American-style Stasi methods”

In a guest editorial for Spiegel Online on Tuesday, Justice Minister Sabine Leutheusser-Schnarrenberger said reports that the United States could access and track virtually all forms of Internet communication were “deeply disconcerting” and potentially dangerous.

“The more a society monitors, controls and observes its citizens, the less free it is,” she said.

“The suspicion of excessive surveillance of communication is so alarming that it cannot be ignored. For that reason, openness and clarification by the U.S. administration itself is paramount at this point. All facts must be put on the table.”

Markus Ferber, a member of Merkel’s Bavarian sister party who sits in the European Parliament, went further, accusing Washington of using “American-style Stasi methods”.

In Italy, the government official in charge of data protection, Antonello Soro, said that the surveillance that the NSA is doing “would not be legal in Italy” and would be “contrary to the principles of our legislation and would represent a very serious violation”.

In Russia (another country with a long history of using Big Brother tactics), President Vladimir Putin has expressed significant concern about the NSA spying program and there are even rumors that Russia will be offering asylum to Edward Snowden

Alexey Pushkov, head of the Duma’s international affairs committee and a vocal US critic, said on Twitter: “By promising asylum to Snowden, Moscow has taken upon itself the protection of those persecuted for political reasons. There will be hysterics in the US. They only recognise this right for themselves.”

He continued: “Listening to telephones and tracking the internet, the US special services broke the laws of their country. In this case, Snowden, like Assange, is a human rights activist.”

But even more important than what foreign politicians think about the NSA spying scandal is what average people all over the globe think.  This scandal is causing millions of average people all over the planet to look at the United States with disgust and disdain.  How can we hold ourselves out as the “defenders of freedom” to the rest of the globe when we are openly telling them that we are going to spy on them as much as we possibly can?  How do we expect the rest of the world to look at us as “the good guys” when we are selfishly grabbing and recording all of their emails, phone calls and Internet searches without any concern for their privacy whatsoever?

What makes all of this even worse is that our top intelligence officials are making jokes about this scandal.  For example, just check out the wisecracks that the Director of National Intelligence, James Clapper, was making at an awards ceremony on Friday

With the current and past directors of national intelligence at the Omni Shoreham to honor former CIA and National Security Agency chief Michael Hayden, the result in speeches and interviews with intel professionals was a gumbo of outrage, worry and humor.

Director of National Intelligence James Clapper told the black-tie crowd of more than 700 he would “address the elephant in the room” and proceeded, to applause, to denounce “the unauthorized leaks as reprehensible and egregious.” Clapper characterized the program as completely legal, debated and reauthorized by Congress under strict oversight and by court order “to make our nation safe and secure.”

He then cracked a few jokes. “Some of you expressed surprise that I showed up—so many emails to read!” Clapper said. Greeting fellow banqueter John Pistole, the administrator of the Transportation Security Administration who recently reversed a planned policy to permit air travelers to carry certain knives on planes, Clapper said, “John, can I borrow your pocket knife?”

How in the world can he make a joke about reading our emails at a time like this?

This is how arrogant the U.S. intelligence community has become.  They feel like they can do whatever they want and get away with it.

For example, back in March Clapper flat out lied to the U.S. Congress about the surveillance that the NSA is doing.  When he was asked by Senator Ron Wyden if the NSA was collecting any information on the American people, Clapper completely denied it.

The following is from a transcript of that exchange

“Does the NSA collect any type of data at all on millions or hundreds of millions of Americans?” Oregon Republican Sen. Ron Wyden asked Clapper at the March 12 hearing.

“No, sir,” Clapper responded.

“It does not?” Wyden pressed.

Clapper recanted and said: “Not wittingly. There are cases where they could, inadvertently perhaps, collect — but not wittingly.”

Apparently Clapper must have “forgotten” that the government is forcing all of the big telephone companies to turn over all of their call records to the NSA every single month.

And you know what?  The truth is that the government is not just collecting “metadata” about our phone calls.  The content of our calls is being recorded and stored as well.  Just check out this story from the Blaze

Hollywood actor Shia LaBeouf in 2008 during an appearance on the Tonight Show with Jay Leno detailed how he learned phone calls were allegedly being recorded.

Promoting the film “Eagle Eye,” which according to IMDb shows how “technology of everyday life [is used] to track and control,” LaBeouf told Leno that an FBI consultant for the movie said one in five phone calls made are recorded and logged.

“And I laughed at him,” LaBeouf said.

“And then he played back a phone conversation I’d had two years prior to joining the picture,” LaBouf continued.

Both Leno and LaBeouf concluded it was “extremely creepy.”

The American people, along with the people of the entire planet, deserve the truth about this.

Unfortunately, Barack Obama is certainly not going to tell us the truth, and there will probably only be a half-hearted effort by some members of Congress to get to the bottom of things.

That is why it is going to be important to take this to court, and thankfully a couple of lawsuits are already in the works.

According to U.S. News & World Report, one of these lawsuits is being filed by a former Justice Department prosecutor…

Former Justice Department prosecutor Larry Klayman amended an existing lawsuit against Verizon and a slew of Obama administration officials Monday to make it the first class-action lawsuit in response to the publication of a secret court order instructing Verizon to hand over all phone records of millions of American customers on an “ongoing, daily basis.”

Klayman told U.S. News he will file a second class-action lawsuit Wednesday in the U.S. District Court for the District of Columbia targeting government officials and each of the nine companies listed in a leaked National Security Agency slideshow as participants in the government’s PRISM program.

And according to USA Today, the ACLU has also filed a lawsuit…

National Security Agency surveillance programs came under more scrutiny Tuesday as the American Civil Liberties Union filed a lawsuit and a prominent senator and Internet giant Google called on the Obama administration to disclose more information.

In its lawsuit, the ACLU said an NSA program that harvests phone calls violates the rights of all Americans.

“The program goes far beyond even the permissive limits set by the Patriot Act and represents a gross infringement of the freedom of association and the right to privacy,” said Jameel Jaffer, the ACLU’s deputy legal director.

Hopefully these lawsuits will reveal more details about the spying that has been taking place.

There is also a “bipartisan coalition” of 86 Internet companies and civil liberties organizations that have sent a letter to Congress demanding action on these issues.  You can read the full letter right here.  Some of the organizations involved include the Electronic Frontier Foundation, Reddit, Mozilla, FreedomWorks, and the Center for Digital Democracy.

Will Congress listen to them?

Probably not.

But at least they are trying to do something about this.

The key will be to get the American people outraged enough about all of this that they won’t forget about it in a week or two.  And that is not an easy thing to do.

There have been a couple of public opinion polls taken over the past few days that show some very curious results.  A Rasmussen survey found that 59 percent of Americans are against the government secretly collecting our phone records and only 26 percent are in favor.  But a Washington Post survey found that 56 percent of Americans consider the collecting of our phone records to be “acceptable” and only 41 percent consider the practice to be “unacceptable”.

How could those two surveys get such wildly different results?

A lot of it is in the way that they ask the questions.

In the end, our politicians don’t really care too much about what the general public thinks anyway.  They are just going to continue to do what they have been doing and the rest of the world will continue to become even more disgusted with us.

We are recklessly destroying our global reputation and our leaders do not even seem to care.  But someday America will need some friends, and when that day arrives we may find that we don’t have too many left.

27 Edward Snowden Quotes About U.S. Government Spying That Should Send A Chill Up Your Spine

Edward SnowdenWould you be willing to give up what Edward Snowden has given up?  He has given up his high paying job, his home, his girlfriend, his family, his future and his freedom just to expose the monolithic spy machinery that the U.S. government has been secretly building to the world.  He says that he does not want to live in a world where there isn’t any privacy.  He says that he does not want to live in a world where everything that he says and does is recorded.  Thanks to Snowden, we now know that the U.S. government has been spying on us to a degree that most people would have never even dared to imagine.  Up until now, the general public has known very little about the U.S. government spy grid that knows almost everything about us.  But making this information public is going to cost Edward Snowden everything.  Essentially, his previous life is now totally over.  And if the U.S. government gets their hands on him, he will be very fortunate if he only has to spend the next several decades rotting in some horrible prison somewhere.  There is a reason why government whistleblowers are so rare.  And most Americans are so apathetic that they wouldn’t even give up watching their favorite television show for a single evening to do something good for society.  Most Americans never even try to make a difference because they do not believe that it will benefit them personally.  Meanwhile, our society continues to fall apart all around us.  Hopefully the great sacrifice that Edward Snowden has made will not be in vain.  Hopefully people will carefully consider what he has tried to share with the world.  The following are 27 quotes from Edward Snowden about U.S. government spying that should send a chill up your spine…

#1 “The majority of people in developed countries spend at least some time interacting with the Internet, and Governments are abusing that necessity in secret to extend their powers beyond what is necessary and appropriate.”

#2 “…I believe that at this point in history, the greatest danger to our freedom and way of life comes from the reasonable fear of omniscient State powers kept in check by nothing more than policy documents.”

#3 “The government has granted itself power it is not entitled to. There is no public oversight. The result is people like myself have the latitude to go further than they are allowed to.”

#4 “…I can’t in good conscience allow the US government to destroy privacy, internet freedom and basic liberties for people around the world with this massive surveillance machine they’re secretly building.”

#5 “The NSA has built an infrastructure that allows it to intercept almost everything.”

#6 “With this capability, the vast majority of human communications are automatically ingested without targeting. If I wanted to see your e-mails or your wife’s phone, all I have to do is use intercepts. I can get your e-mails, passwords, phone records, credit cards.”

#7 “Any analyst at any time can target anyone. Any selector, anywhere… I, sitting at my desk, certainly had the authorities to wiretap anyone, from you or your accountant, to a federal judge, to even the President…”

#8 “To do that, the NSA specifically targets the communications of everyone. It ingests them by default. It collects them in its system and it filters them and it analyzes them and it measures them and it stores them for periods of time simply because that’s the easiest, most efficient and most valuable way to achieve these ends. So while they may be intending to target someone associated with a foreign government, or someone that they suspect of terrorism, they are collecting YOUR communications to do so.”

#9 “I believe that when [senator Ron] Wyden and [senator Mark] Udall asked about the scale of this, they [the NSA] said it did not have the tools to provide an answer. We do have the tools and I have maps showing where people have been scrutinized most. We collect more digital communications from America than we do from the Russians.”

#10 “…they are intent on making every conversation and every form of behavior in the world known to them.”

#11 “Even if you’re not doing anything wrong, you’re being watched and recorded. …it’s getting to the point where you don’t have to have done anything wrong, you simply have to eventually fall under suspicion from somebody, even by a wrong call, and then they can use this system to go back in time and scrutinize every decision you’ve ever made, every friend you’ve ever discussed something with, and attack you on that basis, to sort of derive suspicion from an innocent life.”

#12 “Allowing the U.S. government to intimidate its people with threats of retaliation for revealing wrongdoing is contrary to the public interest.”

#13 “Everyone everywhere now understands how bad things have gotten — and they’re talking about it. They have the power to decide for themselves whether they are willing to sacrifice their privacy to the surveillance state.”

#14 “I do not want to live in a world where everything I do and say is recorded. That is not something I am willing to support or live under.”

#15 “I don’t want to live in a world where there’s no privacy, and therefore no room for intellectual exploration and creativity.”

#16 “I have no intention of hiding who I am because I know I have done nothing wrong.”

#17 “I had been looking for leaders, but I realized that leadership is about being the first to act.”

#18 “There are more important things than money. If I were motivated by money, I could have sold these documents to any number of countries and gotten very rich.”

#19 “The great fear that I have regarding the outcome for America of these disclosures is that nothing will change. [People] won’t be willing to take the risks necessary to stand up and fight to change things… And in the months ahead, the years ahead, it’s only going to get worse. [The NSA will] say that… because of the crisis, the dangers that we face in the world, some new and unpredicted threat, we need more authority, we need more power, and there will be nothing the people can do at that point to oppose it. And it will be turnkey tyranny.”

#20 “I will be satisfied if the federation of secret law, unequal pardon and irresistible executive powers that rule the world that I love are revealed even for an instant.”

#21 “You can’t come up against the world’s most powerful intelligence agencies and not accept the risk.”

#22 “I know the media likes to personalize political debates, and I know the government will demonize me.”

#23 “We have got a CIA station just up the road – the consulate here in Hong Kong – and I am sure they are going to be busy for the next week. And that is a concern I will live with for the rest of my life, however long that happens to be.”

#24 “I understand that I will be made to suffer for my actions, and that the return of this information to the public marks my end.”

#25 “There’s no saving me.”

#26 “The only thing I fear is the harmful effects on my family, who I won’t be able to help any more. That’s what keeps me up at night.”

#27 “I do not expect to see home again.”

Would you make the same choice that Edward Snowden made?  Most Americans would not.  One CNN reporter says that he really admires Snowden because he has tried to get insiders to come forward with details about government spying for years, but none of them were ever willing to…

As a digital technology writer, I have had more than one former student and colleague tell me about digital switchers they have serviced through which calls and data are diverted to government servers or the big data algorithms they’ve written to be used on our e-mails by intelligence agencies. I always begged them to write about it or to let me do so while protecting their identities. They refused to come forward and believed my efforts to shield them would be futile. “I don’t want to lose my security clearance. Or my freedom,” one told me.

And if the U.S. government has anything to say about it, Snowden is most definitely going to pay for what he has done.  In fact, according to the Daily Beast, a directorate known as “the Q Group” is already hunting Snowden down…

The people who began chasing Snowden work for the Associate Directorate for Security and Counterintelligence, according to former U.S. intelligence officers who spoke on condition of anonymity. The directorate, sometimes known as “the Q Group,” is continuing to track Snowden now that he’s outed himself as The Guardian’s source, according to the intelligence officers.

If Snowden is not already under the protection of some foreign government (such as China), it will just be a matter of time before U.S. government agents get him.

And how will they treat him once they find him?  Well, one reporter overheard a group of U.S. intelligence officials talking about how Edward Snowden should be “disappeared”.  The following is from a Daily Mail article that was posted on Monday…

A group of intelligence officials were overheard yesterday discussing how the National Security Agency worker who leaked sensitive documents to a reporter last week should be ‘disappeared.’

Foreign policy analyst and editor at large of The Atlantic, Steve Clemons, tweeted about the ‘disturbing’ conversation after listening in to four men who were sitting near him as he waited for a flight at Washington’s Dulles airport.

‘In Dulles UAL lounge listening to 4 US intel officials saying loudly leaker & reporter on #NSA stuff should be disappeared recorded a bit,’ he tweeted at 8:42 a.m. on Saturday.

According to Clemons, the men had been attending an event hosted by the Intelligence and National Security Alliance.

As an American, I am deeply disturbed that the U.S. government is embarrassing itself in front of the rest of the world like this.

The fact that we are collecting trillions of pieces of information on people all over the planet is a massive embarrassment and the fact that our politicians are defending this practice now that it has been exposed is a massive embarrassment.

If the U.S. government continues to act like a Big Brother police state, then the rest of the world will eventually conclude that is exactly what we are.  At that point we become the “bad guy” and we lose all credibility with the rest of the planet.

OOPS! – U.S. Government Unemployment Numbers Have To Be Revised Because They Were Off By Almost One MILLION!

What a mess! We all knew that U.S. government unemployment numbers were off, but this is ridiculous. It is now being reported that the U.S. may lose 824,000 jobs when the government releases its annual revision to employment data on February 5th.  How in the world could the original figures be so far off?  The truth is that U.S. government figures have been getting more and more out of touch with reality each year.  Government bureaucrats have been monkeying with the “definitions” of unemployment and inflation for decades, and at this point the figures they give us mean little to nothing.  For example, the U.S. government has been telling us that the unemployment rate in the U.S. is somewhere around 10 percent, while everyone knows that the “real” number is somewhere in the neighborhood of 20-22 percent.

But one thing is for certain – unemployment is going up.  The Labor Department announced on Tuesday that unemployment rose in 82 percent of U.S. metro areas during the month of December.

For those keeping score at home, that is not good news.

And all of this unemployment is starting to create huge social problems.

According to a new study from America’s largest food bank operator, the number of Americans in need of food aid has jumped 46 percent in just the last three years.

A 46 percent increase in hunger in just 3 years?

What is going to happen when the economy really collapses?

So is life good for anyone right now?

Oh yeah – life is really good for the companies that the U.S. government bailed out.  In fact, it was just reported that AIG was scheduled to distribute about $100 million in bonuses to its employees on Wednesday.

AIG is giving out about 100 million in bonuses while hunger and unemployment throughout the U.S. are rocketing into the stratosphere – is anyone else disgusted by that?

The truth is that the whole system is failing and we are headed for an economic collapse.  The U.S. economy is in a slow death spiral, and it is only a matter of time until the U.S. dollar implodes.  Ron Paul is warning about that in the video posted below, and he also says that when the dollar does collapse that it could cause a total breakdown of law and order in American society….

What in the world are the American people going to do when the crap really does hit the fan?

Things haven’t even gotten really bad yet and yet Americans are already more doped up on antidepressants than anyone else in the world.  In fact, Americans, who make up about 6 percent of the population of the world, consume approximately 66 percent of the world’s supply of antidepressants.

What a sad nation we have become.

Really, really hard times are on the horizon, and the vast majority of Americans simply do not have the capacity to handle them.

What a mess.

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