into the french yellow face. needs next it's the kaiser report this is r t international. my son there's doing drugs my nephews was still in drugs my sister just with doing drugs it was like an epidemic of drug abuse america's public enemy number one in the united states is drug abuse we started going after the users in a prison populations who are we started treating sick people people who are addicted to these drugs like criminals while i was on the hill i increasingly became convinced that the war on drugs was a mistake there are countless numbers of people who are in prison for. a long sentence and for minor minor offenders in the drug trade it's

a lot watching your children grow up in issue in waves and say by day as you're walking out of a business it's just it doesn't get easier. i'm max kaiser this is the kaiser report. let's check in with stacey see what's going on there if there's a hate what do you think the topic might be wearing a clue. van gogh's paintings as you saw the when the saying eating his own pain in

the field somewhere in the south of france while trading and selling masterpieces i would eventually so for hundreds of billions of dollars thanks to free up money printing now this is actually andy warhol print but don't they yellow a vest that's in our conversation. means mates know. it all know is very chic it's just a show you know we sit on the brink of more revolution maybe perhaps a french spring or a french winter this is ten years after the financial collapse whereby all of our governments around the certainly the western world and the central banks came together and determined that there was no cost that they would not bear to bail out the bankers so now everybody is quite concerned about the fact that the blowback has come finally after ten years is all the ordinary people the bottom

ninety nine percent who did not benefit from the money printing they're starting to do a nod quite similar to what you're doing it's like they're on to their rulers and they're angry well apparently the cost to appease them is too high mark ron's concessions set to blow out french deficit france is on course to overshoot the european union's budget deficit ceiling next year without new spending cuts after president a man well caved in to anti-government street protests macron announced wage increases for the poorest workers and a tax cut for most pensioners on monday to diffuse discontent leaving his government scrambling to come up with extra budget savings or risk blowing through the used to. the percent of g.d.p. limit well let's real back a little bit two thousand and eight crisis was a victimless crime we were told that they were going to bail out the bankers and they spent and globally something like sixteen seventeen trillion dollars to do so and now we have the blowback of that event and the crisis never ended it just was

kicked down the road and now it's being blowing out to the global insurrection against banker occupation or g.i. bill something we've been talking about for ten years it's not going global the g.l.a. there's all the elvis movement will go global will see it all over the world this is the occupy wall street times a thousand but let's talk about you know what we've been saying over the years and why this is true the way that the economy works globally if you take a monetarist school and that is the world we live in under neil liberalism the global central banks find an interest rate that is appropriate to reward savers and to make credit creation possible enough to create new businesses to create jobs and tax revenue to pay down deficits and that naturalize rate of return tends to be around four or five percent what happened in the two thousand and eight crisis is that central banks got together and said wait a minute our friends the bankers need to get bailed out the only way we can do that is if we artificially drop rates down to zero near to zero and the fact that we

move all the money that's in pensions all the money that's in the savings all the money in the. pockets of workers and we transfer it b. of a this transfer mechanism of interest rate manipulation to our banking friends they'll get bailed out we bail out the creditors but the rest the world have to pay the rest of the world didn't really understand what's going on because they don't understand we live in this monstrous world while the ten years later the now they are seeing the results inflation is creeping in the cost of living is going higher than they can possibly afford and they are now insurrection all over the world but let's talk about why this is true micron's a banker he was put in there by the banking establishment to create this scenario to allow for this and. straight apartheid to continue we all live in them bantustan of artificially low rates for them high rates for us and now as you lay joe it's game on so in the second half you're talking michael hudson he's written a new book about debt another person has written

a book about is david graber and he's also looked at the situation going on in this relation and the absence of the understanding in imagination of the elite class the people who are supposed to be the intellectuals who are supposed to explain the situation to us of course what they are explaining they're blaming russia of course for the protest movement but here he's saying the yellow vests show how much the ground moves under our feet if one feature of the truly revolutionary moment is the complete failure of conventional categories to describe what's happening around us then that's a pretty good sign we're living in revolutionary times goes into two explanations for what we're seeing there but the one i want to point to is the cantillon effect because he says he sees that he sees what is going on in the france and then in the yellow vests is about the cantillon effect you and i have covered this and you've just touched on that which is the central banks printing money he said in a financial eyes economy only those closest to the means of money creation essentially investors in a professional managerial classes are in

a position to employ the language of universalism as a result any political claims as base and particularly needs and interests tend to be treated as manifestation of identity politics in the case of the social base of the show and therefore cannot be imagined as anything but proto fascist so the intellectuals look at this rachel maddow source will look at this there are benefits of the free money that comes from the fed into manhattan she lives and hand she's paid by bankers essentially because of the ads taken out against her program and the and the military industrial complex the rock lockheed martin and you know raytheon taking out ads against a thing so they look at these people and what you see is they blame russia and they blame they call them fascists and you'll see that line. going to go in a little bit more once you respond to that about the cantillon effect and he actually puts it down to one hundred seventy one going off the gold standard with the five richest goats in america surround america's central bank that's direct evidence of a conservative like they print the money it goes to those guys in the neighborhood

first wise was jeff bezos moving into that neighborhood because he wanted to get the i can tell in effect one hundred fifty buildings not enough for him he wants three hundred billion so that's a direct correlation and a direct ip so facto cause and effect you see it geographically it's obvious so how the the elites got so divorced from reality and why they can't understand the world around them why they continue to fail well he says since the us jettisoning of the gold standard in one nine hundred seventy one we've seen a profound shift in the nature of capitalism most corporate profits are now no longer derived from producing or even marketing anything but the manipulation of credit debt unregulated rents as government and financial bureaucracies become so intimately intertwined it's increasingly difficult to tell one from the other wealth and power particularly the power to create money that is credit also become effectively the same thing despite this politicians and media commentators

systematically refuse to recognize these new realities for instance in public discourse while my still speak of tax policy as if they need any of this and that that is no longer about money creation that there is actually some sort of wealth creation happening that's the whole idea of the monitor a school of economics is that you are managing our pilot in the economy through the magic of central bank interventions by either buying money or selling money or manipulating interest rates one way or another the fact is that in america like saudi arabia the working class is not needed in saudi arabia raised to five thousand princes and wide scale poverty is because anytime we need money you just pump more oil in america. similarly you don't need a working class in america you don't need the three trillion dollars in taxes they collect the american worker is is is not only deplorable but they are they are confiscated all they are going to get rid of them because all you do if you need

more money is to print more money america is burning presses like the saudi oil well you points out that the commentators the media commentators the likes of the fact they fail to talk about this count on the fact that they fail to tell you how so-called wealth is created in the us that it ensures the means of credit creation can never be democratized i.e. why not next time when i do q.e. for the people of course they're not going to talk about that on that massive b. c. they're going to talk about it on r t we've talked about it our guests like steve keen have talked about it david graber has talked about it but again since two thousand and eight governments have been pumping new money into the system which owing to the notorious control in effect has tended to accrue overwhelmingly to those who already hold financial assets and their technocratic allies and their professional managerial classes and france of course these are precisely the macro inus members of these classes feel they are the embodiment of any possible universalism their conceptions of the universal being firmly rooted in the market or increasingly that atrocious fusion of bureaucracy and market which is the

reigning ideology of what's called the political center a fusion of of the markets with the government with the elite that's a corporatism which then in the one thirty's became fascism a more violent thing but here he points out that this universalism that they're they they they do feel some sort of divine. like that they are somehow better than everybody else because they're wealthy or that and they believe their own propaganda that this is a meritocracy and they continuously condemn the bottom those at the ninety nine percent who always pay through the can tell in effect that those bottom ninety nine percent are all it's right there deplorable zx they're fascists they're proto fascists they project all the stuff they call them fascists when in fact what the elites have is closer to what is the actual definition of fascism minus the you

know the actual in a brown shirt in thuggery in kneecapping it's kind of like mussolini means jim jones jonestown if you can print a hundred million dollars and buy a vango and stick it on a wall and then get your photo on the cover of fortune magazine you are a god. do you work even five minutes for that now not in the sense that you work as long as we have interest rate a part as long as you live in the bantustans of the reserve in the middle of the boonies expendable because we are working taxes are not needed. then we will be ever more going to sign the permanent underclass and the forces of insurrection will continue to get stronger their own movement is going global bankers are now rightfully seen as the enemy

full stop well certainly money creation will always basically make it impossible for you to climb up the ladder and become national in the media you become and the you become the bad guy you're the one that's painted as all right are deplorable or fascist he says working people in this new centrist reality are increasingly denied any possibility of universalism since they literally cannot afford it the ability to act out of concern for the planet for instance rather than exigencies of sheer survival is now a direct side effect of forms of money creation and managerial disagree of rents anyone who is forced to think only of their own or their families immediate material needs is seen as asserting a particular identity and while certain identities might be condescendingly indulge that of the white working class can only be a form of racism they say you know that's propaganda put out by the money printers and we went to the story here is that for ten years we've been saying the story and for it it's taken ten years for people to realize it's not about

a socialist revolution or political conflict interest on an environmental threat it's not and i just it's a threat of central bankers and the people like jamie diamond jamie diamond is the bin laden of the twenty first century who recently actually was quoted as saying that he doesn't understand who all these people are they keep on following him around to public meetings and yelling at him from the audience that's exactly what he was holed up in pakistan next to a u.s. military base as it was following me what's going on here i just like to watch borneo. ok well we're going to take a break and when we come back much more coming your way. seems wrong. just don't. get to shape

our. culture. and indeed. the trail. when so many find themselves worlds apart. to look for common ground. welcome back to the kaiser report imax kaiser ok this is coming out you can preorder this right now at amazon and forgive them their debts this is a masterpiece written by the master himself dr michael hudson welcome back to the guys report thank you have me back i've been waiting for this book for

a while this is i see all the people the back there david graber and purdah for steve king paul craig roberts are all raving about this and it's really a much needed book and especially in the holiday season you know let's talk i want to talk about chapter two here jesus's first sermon and the tradition of debt amnesty in the first reported sermon jesus delivered upon returning to his native nazareth he described all of his ire and announce his mission to restore the year of our lord now until recently the meaning of this phrase was not recognized as referring officially to the jubilees year but breakthroughs in q form research and a key to the. come ron's scroll provide a direct link to that tradition this linkage provides the basis for understanding how early christianity emerged in an epoch so impoverished by debt and the threat of bondage that it was called the end times so now you've been doing research into cuniform you've been looking at the good the tradition of debt forgiveness we live

in an era of the global debt four hundred percent debt to g.d.p. it seems like our end times. yes that's what they would have called the end i'm always barring the emergence of jesus christ and the second coming what are we going to do well one of the things that the babylonians who first developed the concept of the jubilee year the word with the same is in hebrew the babylonian word for debt cancellation and jubilee or was under the hebrew word was dearer and when the. laws introduced the jubilee year to the bible by the return is from babylon the jubilee year was word for word what the royal proclamations of hamurabi and other babylonian leaders were and what the babylonians realised we actually have their mathematical models that they trained their scribes in and the mathematical models used in eighteen hundred b.c.

in babylonia or sapir e or to those used today because they were very simple they realised that finance was not part of the economy but grew by its own mathematical laws and scribes were asked to do two things one to calculate compound interest which grew at the equivalent of twenty percent a year doubling in five years quadrupling in ten years they also had to project the growth of herds and agriculture and that was and they grew in an s. curve and tapered off so every for two thousand years every ruler of the near east know that debts tended to grow faster than economies ability to pay and that became the principle of their economic policy and what they did was say when the personal debts not the business that's but we're talking about personal agrarian debt sort of like student loans and credit card debt grew so large that it would impair.

the debtor from paying the taxes or serving in the army and in fact would lead him to run away which was a big problem that they'd have to cancel. debts or else you'd end up looking like modern greece after the austerity program and if we would have had a free market or milton friedman would have gone back in a time machine and become the advisor to hammer. and said no no let the market work its way let the population become all debt servants and bond servants. to the public collectors and the rich people would have had few feudalism occurring four thousand years earlier than it actually did so the message for today is we know that the death can't be paid because the debts grow faster than the economy so if you don't write them down one of two things are going to happen either you're going to have more and more people in the status of student loan student debt or is today

in credit card debt or is and families that spend all of their wages over subsistence to the banks for interest or you have to decide it's not worth sacrificing the economy just to pay the creditors and the good thing about cancelling the debts is not only to free the creditors but is not only be said but as the byzantine rulers said the good thing about cancelling debts is you wipe out the savings of the rich people in the savings of the rich people they're going to use it they're going to overthrow us and make a free market economy and i have the quotations and the books they're going to try to take over the land and not pay the taxes just like today they didn't have offshore banking centers and byzantium but they simply didn't pay and they hired their own armies to fight against the byzantine rulers and there was a military war over the debt issue just as there was in rome classical grace and

the late bronze age looking at history you realize number one that canceling the debts doesn't cause an economic right. this is the way to prevent an economic crisis is the way to preserve. economies where people's heads above water. and once that stops as it did in rome that was the you know rome and when it was the first place that didn't cancel the debts ended up in feudalism so that's the model but i think economic analysis should start with well and so let's just focus in on one specific metric if you well so ancient credit analysis and you were a credit analyst actually on wall street as i started your career you've been looking at credit in the economy and in the in the business world for decades now you make a point there that is one that seems to hinge on this whole story and that is that compound it rate of interest in the debt is grows at

a faster rate than the economy can grow at any possible right to pay down that debt you know you know einstein called compound interest the most destructive force in the universe and one of the greatest forces in the universe here's a guy who was associate with the atomic bomb and yet he thought compound interest was was incredibly destructive but when you apply that to debt you have this problem where it's growing at a pace that. you can't pay it off and you end up with all these different problems that are associated with it and so we live in an era today where you know everyone in the elite. you know all the situations are basically repeated day in two thousand and eight that would have been as we've talked about on the show the absolute prime point to do it that you believe to bail out the debtors and the creditors were bailed out even hank paulson wanted to nationalize citibank but he was overruled by obama who insisted on bailing out wall street well remember obama

had submitted the list of cabinet members to citibank to the bagmen for wall street tim geithner for approval so city. bank got to name obama's cabinet and sheila bair also wanted to take over citibank because she said it was hopelessly incompetent and it was broke and that it should be taken over but geithner and the president clinton's treasury secretary. who runs as citibank by that time overruled them and obama then invited the bankers to the wall to the white house and he said i'm the only guy standing between you and the mobs and pitchforks but believe me my loyalty is to you the donor class not to the voters i'll deliver the voters to you and that's what he did and it's still what the democratic party is is doing today both parties basically are. saying what people

want to hear but in practice they are they want to maintain the debt and if you look at what the council of economic advisors report both under trump and under obama and under president bush they all forecast g.d.p. is growing at compound interest they say here's the historical rate is that g.d.p. will automatically grow what they don't forecast is growing at compound interest and they don't realize that the g.d.p. is going to grow slower and slower and slower as more and more debt service is used to pay the banks that are not going to real and the money to keep the economy going but they're going to use it in depth the economy even more so housing prices are going to go up even more stock prices will go up meaning to stock the olds will go down bond yields will go down so basically by saving the banks obama undercut the pension funds undercut the four a one k. savings plans undercut people's ability to save for their retirement without

turning their money over to wall street and getting taken by the sharpies the c.e.o. of illustrated so often. so in biblical times of ancient times debt was something that occurred. you know people fell behind in taxes and peoples they had to. and they were farmers and there was a catastrophic force made your crops didn't come in and they accumulated debt and through no more all you know failing of their of their person they were they were simply part of an economy where debt is kind of a rapid spawn you know spontaneously if you will and so what you're saying is that jesus you know put down the book of this idea of the debt jubilee to forgive the debt economically you do two very powerful things you keep the farmers in the consumers going about their way without being going into debt present and you do this enfranchise the debt sellers the debt mongers the debt you know the and make

it into a whole biblical thing where you know who are ruining the economy because a mountain me mention milton friedman there so in modern times milton friedman and then margaret thatcher era and the era of near liberalization they turn debt from a balance sheet item to something that was a growth item that the faster companies could incur debt the more you could encourage and we can securitize it and sell to some other bank and create this daisy chain and not only did it become ok it became the basis of the economy this was a historic change never in history did people think that the way to get rich was to go into debt down until i'd say the nineteen fifties the whole idea was to pay off the mortgage not to oa anything because you knew that once you owed something you tend to fall further and further behind and you'd get on the treadmill and babylon knew that. judah knew the. roman greece knew that.

the idea that you can get rich by going into debt is obviously better talk in a cover story for. the banks and the bondholders that are selling debt and it doesn't work and yet. that's not the center of the economics curriculum as it should be what the debt problem debt didn't appear and the whole economics curriculum all the time i worked in the ph d. you know donald trump was recently asked about the debt in the united states at twenty two trillion and he said well you know i'm not going to around much have to deal with it so he's pushing that into the future we only have about thirty seconds i want to cut you off and we're going to bring it back in a second segment but donald trump obviously would not be featured as one of the good guys in the bible well even when he did money he didn't fail as debts to the banks and the bank would lend to him at all so you'd think he'd be friendly towards this but i'm sure you know his campaign contributors work all right well if it does open to another segment thanks for being on this episode has

a report and that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert want to thank our guest dr michael hudson the new book is called and forgive them their debts it's an instant classic you can preorder right now on amazon i highly recommend the book of the year. catch us on twitter it's kaiser and i stand by. yes well this is all the proof.

so what we've got to do is identify the threats that we have it's crazy to. let it be an arms race. spearing dramatic development that only. exists i don't see how that strategy will be very.

tough. love. a key moment in the syrian peace process diplomats from russia turkey. for alleged to take place in the nation.