Signs of the Economic Apocalypse 12-26-05

From Signs of the Times 12-26-05:

Gold closed at $505.90 an ounce on Friday, up less than 0.1% from $505.50 the week before. The dollar closed at 0.8425 euros last week, up 1.2% from 0.8323 at the previous Friday’s close. That put the euro at 1.1869 dollars, compared to 1.2015 the week before. Gold in euros would be 426.24 euros an ounce, up 1.3% from 420.72 euros an ounce the Friday before. Oil closed at 58.43 dollars a barrel Friday, up 0o.6% from $58.06 the week before. Oil in euros would be 49.23 euros a barrel, up 2.1% from 48.23 euros a barrel the Friday before last. The gold/oil ratio closed at 8.66 Friday, down 0.6% from 8.71 at the previous Friday’s close. In U.S. stocks, the Dow closed at 10,883.27 on Friday, up less than a tenth of a percent for the week from 10,875.59. The NASDAQ closed at 2,249.42, down 0.1% from 2,252.48 the week before. The yield on the ten-year U.S. Treasury note closed at 4.38%, down six basis points from 4.44 the week before.

Friday saw the release of the U.S. new housing sales numbers for November. The numbers were surprisingly bad:

New Home Sales Plummet in November
By MARTIN CRUTSINGER, AP Economics Writer

Sales of new homes plunged in November by the largest amount in nearly 12 years, providing the most dramatic evidence yet that the red hot housing market over the last five years is starting to cool down.

The Commerce Department reported Friday that new single-family homes were sold at a seasonally adjusted annual rate of 1.245 million units last month, a drop of 11.3 percent from October, when sales had surged to an all-time high.

Last month's decline was even bigger than the 8.7 percent drop-off that Wall Street analysts had been expecting. While sales of both new and existing homes are still on track to set records for a fifth straight year in 2005, analysts are forecasting sales will decline in 2006 as the housing boom quiets down.

Prices for houses declined as well, an unsold inventory is building up rapidly.

The New York transit strike dominated the news in the early part of the week, with the corporate media attacking the workers for being heartless and greedy. To put that charge in perspective, we need to look at those workers in the context of the whole New York economy:

Christmas in New York
Billions in bonuses for Wall Street execs; mayor denounces “selfish” transit workers

By Jerry Isaacs23 December 2005

Earlier this week New York’s Mayor Michael Bloomberg denounced striking transit workers as overpaid and selfish “thugs” who were indifferent to the impact of their walkout on the city’s working poor. These comments were rather rich coming from a mayor who, with a net worth of $5 billion, is rated number 34 on Forbes magazine’s list of wealthiest Americans.

But Bloomberg wasn’t speaking just for himself. The transit strike was viewed as a virtual slave rebellion by New York’s entire financial elite, which has been enriching itself beyond imagination for the last quarter century.

For transit workers, already struggling to make ends meet in one of the costliest cities in world, this Christmas will be a toned down affair, particularly with the threat of heavy fines hanging over their heads, including the loss of two days pay for every day on strike. For Wall Street executives, however, this will be a very merry Christmas.

December is the month for year-end bonuses for Wall Street’s traders, brokers and investment bankers and this year the top layers are expected to pocket some $17 billion in incentive payouts. According to Johnson Associates Inc., a compensation consulting firm, the average bonus for a managing director will be $1.2 million, with top investment bankers and prime brokers seeing checks padded by as much as 20 percent more than 2004’s bonuses. Specialists in energy markets, hedge funds and proprietary trading will likely earn even more.

According New York magazine, Goldman Sachs has put aside $11 billion for bonuses. With 22,000 employees worldwide, that would amount to $500,000 a piece. But not everyone makes the same. Goldman’s top officials—250 partner managing directors—get an average bonus of $2 million to start. Top producers can expect incentive awards of up to $40 million. The next tier of management—executive managing directors—can ring in 2006 with bonuses of up to $3 million.

After the Enron and other corporate scandals there was a certain media and legal attention paid to the massive payoffs on Wall Street. As the scrutiny of such excesses has all but disappeared, so has any reticence over grabbing as much as possible.

“People have had enough of listening to bad news,” said Glenn Mazzella of World Wide Yacht Corporation. “They want to go yachting, and they want to go skiing and they want to drive a Maybach (a German car that retails for $325,000). They’re tired of feeling embarrassed.”

“There’s someone on Wall Street that’s taking 20 of his closest buddies for his bachelor party, renting a yacht, cruising the Caribbean and ending up in Sandy Lane in Barbados on the golf course,” says Tatiana Bryon, president of the New York event planner 4PM Events. The cost: $200,000.

The windfall has also sparked sales of Hummer sport utility vehicles and luxury sports cars. John Bruno Jr., general sales manager of Hummer of Manhattan, says he sold 29 percent more of the General Motors Corp.-made sport utility vehicles this September compared with a year ago. The majority of sales are of the H2, with luxury packages starting at more than $61,000, and the military-specification H1, which sells for $129,000 or more. “We get a lot of Wall Street guys,” says Bruno.

The $200,000 Italian-made Lamborghini Gallardo is this year’s hottest car at Gotham Dream Cars LLC, says Noah Lehmann-Haupt, president. Clients including mortgage brokers and traders pay $1,750 a day to drive the 200-mile-per-hour machines. Lehmann-Haupt says he is planning to almost double the Upper West Side exotic car rental company’s fleet next year to 11, including the new Gallardo Spyder.

The mayor of New York has nothing to say about this grotesque consumption while he denounces transit workers who earn $50,000 a year. Bloomberg, like the rest of New York’s elite, lives in an entirely different universe from the working class of the city who struggle to meet the high cost of living.

According to salary.com, New York is the least affordable metro area in the US. “Employers in New York typically pay 15.5 percent higher than the national average, BUT the cost of living in New York is 94 percent higher. This means that an average worker currently earning $50,000/year in the average US city would have to earn approximately $37,000 more a year in New York to maintain his or her standard of living. A $37,000 raise is a hard thing to come by, even in the Big Apple.”

It’s a hard thing to come by for most, but it’s a pittance for some, particularly on Wall Street.

On the transit picket lines, workers readily answered the billionaire mayor’s remarks. “Bloomberg is a jerk,” said Grant, a train repairman in Queens. “He’s talking like we’re his servants and we’re getting out of hand. They have all the money. They’ll never see the wear and tear on their bodies that we go through. They work in clean rooms, in cushy chairs, with temperature control. On some days during the summer it’s over 100 degrees in the depot. It’s like you’re in a box and have to be bent over every day.

“What’s Christmas like for New York’s elite? They fly their friends to the Bahamas and buy their girlfriends drinks costing thousands of dollars, like the one I saw on TV that is a glass of diamonds with alcohol poured over them. In one drunken night some of these guys spend more money than we earn all year.

“More than half of our incomes go for housing. It costs $1,500, $1,600 or $1,700 a month for rent. People are going to have to live in group communes just to afford the rent. Then you have to pay higher prices for food, gas and things our children need. We work to pay our bills so we can go to work again. There’s never enough just to go to a movie or buy some new shoes or take the kids where you really want to go.

“Four percent wage increases hardly keep up with the rate of inflation of food and other costs. Now they want to mess with our pensions so one day when you’re in a nursing home they’ll just shove you in the street when you run out of money.

“That’s why we went on strike. We shut down the city to show them that we won’t take any more.”

Now why would Goldman Sachs alone pay out 12 billion in bonuses? That’s more than the annual revenue of all but the largest corporations. This money comes directly out of the pockets of investors (including large institutional funds like pension funds). Can there be any doubt that Wall Street siphons too much out of the system through parasitical, yet mostly legal, insider schemes? Some will argue that the year-end bonuses are compensation for performance. But why so much? But even if you accept that, why does Wall Street and their mouthpieces in the media begrudge transit workers the subsistence wages they are earning? Here is some of what the media mouthpieces were pushing:

Behind the media onslaught on the transit workers

By Peter Daniels

23 December 2005

While New York City’s striking transit workers were winning broad sympathy and support from millions of working people this week, the mass media swung into action with a predictably unanimous campaign of hysterical slanders against the strikers.

This may have been predictable, but it was no less significant. Both print and broadcast media, in every case the organs of billion-dollar corporate empires, did their best to ignore the public support for the workers, while manufacturing their own version of public opinion.

Rupert Murdoch’s New York Post was perhaps the crudest along these lines, with an overline, “A message from New York commuters to striking workers,” followed by the screaming two-word headline, “You Rats.”

On television, ABC News found someone unable to get to his brother’s wake, which was blamed on the strikers. Television reporters cornered an emergency medical technician and attempted to get him to say that the workers had endangered the life of a patient whose trip to the hospital was slowed by traffic. Several individuals were featured in 20-second sound bites with one-word punch lines like “outrageous” and “unconscionable,” referring to the strike. No transit workers or supporters were interviewed on camera.

The Daily News, owned by multimillionaire Mortimer Zuckerman, took the prize for rabid labor-baiting verging on incitement to violence, with an editorial entitled, “Throw Roger from the train!” referring to TWU Local 100 President Roger Toussaint.

“Roger Toussaint, we dare you to take to the Brooklyn Bridge this morning to tell the cold, walking throngs why you chose to disrupt the lives of millions, jacked up the expenses of tens of thousands, shuttered and crimped business, opposed the subway system to terrorism and generally threatened the public health and welfare,” the News editors shrieked.

“It would be delicious watching you try to justify the reckless, lawless transit strike that you have inflicted on the city—assuming your fellow New Yorkers didn’t hurl you over the railing into the icy waters before you got a word out ...”
In fact, although those crossing the Brooklyn Bridge no doubt include some disgruntled middle class and wealthy commuters, it’s a safe bet that transit workers would also be met with warm support there, as evidenced by drivers honking in support of transit pickets, and even in numerous letters to the same papers whose editors denounced the workers.

What passes for the “liberal” press joined in the attacks on the union. The New York Times headlined its nervous editorial, “An Unnecessary Transit Strike,” while Newsday denounced this “outrageous and illegal action.”

The media attacks against the workers fall into two main categories: First, the transit workers, averaging more than $50,000 annually in wages, are greedy. Second, in the pious and hypocritical words of Mayor Michael Bloomberg, “we live in a country of laws where there can be severe consequences for those who break them.”

Talk of greed is a bit ironic from a man who just spent more than $70 million to buy his reelection, or more than $100 for each ballot cast in his favor. Bloomberg is mayor of the capital of world finance for one overwhelming reason—his enormous wealth. No one who stops to consider his background and qualifications, even accepting his claims to managerial expertise, can doubt for a moment that he would never have been considered for the post, nor would his name even be known to the vast majority of the population, if not for his wealth. He convinced his fellow billionaires that he would do an effective job in defending their interests, and he then bought the election, something that was not very difficult considering the nature of the American two-party system and the complete political disenfranchisement of the working class majority.

Shameless is too mild a word to describe the arrogance of the billionaires who scream greed against workers who are paid barely enough to live on while carrying out work that is physically and psychologically stressful. Meanwhile, at this very moment, the Wall Street brokerage houses are handing out million-dollar year-end bonuses to several thousand traders whose work includes nothing productive.

It is interesting to note, by the way, that in recent years the newspapers have generally trumpeted the appearance of these year-end bonuses in the financial services sector, pointing to them as a sign of vitality for the local economy. This year, in the midst of the strike of the “greedy” transit workers, the Wall Street bonus story seems to have disappeared.

What about the charge of illegality? We are ruled by a government in Washington that was illegal and illegitimate from its first day in office nearly five years ago. The figurehead for this cabal is a man who has been secretly authorizing illegal wiretapping of thousands of US citizens over the last several years. Last weekend George W. Bush proudly reaffirmed his right to make his own rules and ignore laws he opposes.

None of the newspaper reporters covering the transit strike has asked Bloomberg, the Republican mayor, for his opinion on the rule of law in this case. Perhaps that is what he meant when he said that “there can be severe consequences” for breaking the law. It does not follow automatically. The workers who courageously defy an anti-strike law, a law comparable to the laws defied by the millions who organized trade unions in the 1930s and fought against Jim Crow segregation in the 1950s and 1960s, must be punished. A president who moves toward the destruction of the most basic democratic rights is another matter entirely.

Behind the lies spread against the transit workers are very definite material interests and a definite strategy being pursued by dominant sections of the US political and financial establishment. The aims are spelled out in the Wall Street Journal, the mouthpiece of extreme reaction.

The December 21 editorial explains what is at stake in the transit strike. The editors are somewhat contemptuous even of Republican Governor George Pataki and Mayor Bloomberg for having “caved” to the municipal unions in the past. By this they mean that the big business politicians have been unable to push through the kinds of attacks on the wages and benefits of public employees that are deemed necessary.

The incredible polarization and explosion of wealth for a tiny handful on Wall Street is not enough to assure the health of the capitalist system. The system, by its own admission, in the words of the Journal, requires a relentless and unending series of attacks on every gain that has been made by working people over the past century. The editors seethe with fury over workers’ salaries of $50,000 a year. Pensions and health care also have to go, especially to set a precedent for literally millions of government workers elsewhere. Public transit itself has to go, according to the Journal. “Pataki and Bloomberg ... could use this strike as an opportunity to end the public transit monopoly by legalizing all forms of private competition—including jitneys.”

And this type of society, pathocratic investment capitalism (where those who trade various instruments of ownership rights take home everything while the people who make things and make things run can barely make ends meet) is spreading to Europe, too.

“Life is good for the wealthy”
Germany: Social inequality is constantly growing

By Dietmar Henning

19 December 2005

A new report has found that the gap between rich and poor in Germany has grown considerably and will continue to do so. The report, published recently by the Economics and Sociological Institute (WSI) of the trade-union financed Hans Böckler Foundation, was titled “Life is good for the wealthy.”

Dr. Claus Schäfer, author of the WSI report, presents various statistics that show the level of social inequality in Germany today, as well as the growth of inequality under the previous Social Democratic Party (SPD)-Green Party coalition government. The policies of the incoming grand coalition of the Christian Democratic Union (CDU) and Social Democrats will further widen the gulf between wage earners and those with property or incomes from business activities.

The overall share of wages as a proportion of income of all types has fallen constantly since 2000, dropping below 70 percent last year, for the first time since 1990. In the first half of 2005, it amounted to only 65.7 percent.

The net wages ratio—the proportion of wages and salaries (after the deduction of social security contributions and payroll taxes) as a share of all income—and which approximates to how much disposable income remains in workers’ pay packets, has followed a similar pattern. It has dropped from 48.1 percent in 1991 to 41.5 percent last year. In the first half of 2005, the net wages ratio sank even further, to under 39 percent. How far workers’ disposable incomes have fallen can be seen by the fact that in 1960 the net wages ratio amounted to 55.8 percent.

While wages and salaries are falling, incomes derived from business profits and wealth are rising. Since the stock market collapse in 2000 and 2001, such incomes have risen strongly, both relatively and absolutely, with a net share of the national income of approximately 32 percent (29.3 percent in 1992, 24.4 percent in 1960).

…Company profits are hardly subject to taxation in Germany today. Some 25 years ago, in 1980, company profits were taxed on average at a rate of 32.7 percent. In 1990, the year of German reunification, this had fallen to around 21 percent. Under the SPD-Green Party government, this fell temporarily to 6.3 percent, with the virtual abolition of corporation taxes in 2001 and 2002. Last year, the rate had risen to 9.2 percent, but is still at a “historically extraordinarily low level,” according to the report’s author, Claus Schäfer. Moreover, it is a well-known fact that for a long time the largest companies, like DaimlerChrysler, have paid no taxes at all.

Schäfer notes that only a few countries have such low levels of corporation tax as Germany: “At 1.3 percent of GDP, this level of corporation tax places Germany in 29th position out of all OECD countries, making it a tax haven—above Iceland or Latvia or Lithuania.”

Schäfer also points out that the repeated lowering of business taxes has had quite a different effect than government propaganda would make out. The result has not been an inflow of new investments and the creation of new jobs, but “a continuous increase in payments to shareholders” as well as the “rising acquisition of financial assets and increasing executive board salaries”—in other words, an enormous redistribution from below to above.

Schäfer deals only briefly with the record gains of companies listed on the German DAX stock exchange, and the corresponding number of jobs being slashed. A recent media report by the news station N24 announced on November 29, “In the third quarter, large companies like chemicals giant BASF, auto concern BMW or sports goods manufacturer Adidas-Salomon have reported excellent profits.” However, “The classical rule that companies with rising profits invest more and create new jobs no longer functions.”

…

Increasing poverty

The spending cuts contained in the coalition agreement between the CDU and SPD will lead to a further rise in poverty in Germany. This applies not only to cuts in social expenditure, directly affecting the unemployed, the sick or pensioners, but also indirectly through other austerity measures.

For example, savings by the federal state on public transport will be passed on to the customer. Fare increases or the abandonment of whole routes—like the increase in value-added tax—will above all be to the detriment of low- and average-wage earners. The wealthy do not need a welfare state or public services.

According to the government, approximately 13.5 percent of all Germans already count as poor. Schäfer puts this number even higher, since it is calculated on the basis of positive incomes. Some 8 percent of the population who are considered highly indebted are not taken into consideration. Although their income lies over the poverty line, their debts mean they struggle to survive, making the real level of poverty somewhere between 13.5 and 21.5 percent.

The credit agency Schufa recently pointed out that serious personal debt is increasing drastically. They note that some 10 percent of the 62 million people for whom they have records—approximately 6 million—experienced financial difficulties in the past three years. Approximately 2.6 million people are registered with Schufa under the “red” risk level, and cannot receive a cent in credit because they have already initiated private insolvency proceedings or have declared bankruptcy.

When the SPD-Green Party government came to office in 1998, it initiated an accelerating downward social spiral: the public purse “becomes impoverished” because of one-sided tax breaks for the wealthy and big business. The empty public coffers and rising national debt then serve as the reason for a new round of savings and a more unequal distribution of fiscal charges. The grand coalition under Angela Merkel (CDU) has set itself the task of increasing the rate of this downward spiral and breaking any resistance to it.

For this reason, a word should also be said regarding the conclusions that the report draws. Schäfer, who was employed by the trade-union-financed Hans Böckler Foundation, suggests a national solution for the problems of rising poverty and social polarisation: the strengthening of domestic demand. According to this argument, it is only necessary to reverse the redistribution process—e.g., by “reviving wealth tax, increasing the taxes on inheritance, businesses and those with high private incomes, while lowering the tax burden for employees,” etc.

Schäfer expressly rejects the significance of international factors: “It is not ‘uncontrollable’ external forces such as globalisation that are responsible for the lack of German growth and the job market misery, but a counterproductive national policy that has weakened the domestic demand of private households and the public sector,” he concludes.

This is absurd, as can be seen from the fact that there is not a single government worldwide—either social democratic, liberal or conservative—that follows the prescriptions suggested by Schäfer. The globalisation of production, trade and the financial markets has undermined the mechanisms which in the past ameliorated social contradictions within the national framework. More and more, a powerful international finance oligarchy, which does not accept any restrictions on increasing the rate of profit, determines policy in each individual country. It would react to higher taxes and state spending by withdrawing its capital, throwing the economy into a deep crisis.

If this is happening in the heart of social-democratic western Europe, then we really can see the operation of a “powerful international finance oligarchy.”
Given the fact that the proceeds of any economic growth, anywhere on earth, will only go to the super-rich owners, why should we be happy when we read articles like the following touting the fact that the economy is growing? Given the way the elite have acted and spoken in New York, it doesn’t look like they are going to let any wealth trickle down. In any event, notice that this headline, which looks like good news is referring to the third quarter of 2005 and that the numbers were adjusted downwards from the earlier published estimates.

Economy Grows at Fastest Pace in 1 1/2 Years

By MARTIN CRUTSINGER, AP Economics Writer

The U.S. economy turned in a remarkably strong performance in the summer despite surging energy prices and the battering the Gulf Coast states took from hurricanes, although business growth was slightly lower than the government previously estimated.

The Commerce Department reported Wednesday that the gross domestic product, the nation's total output of goods and services, rose at an annual rate of 4.1 percent in the July-September quarter. It was the fastest pace of growth in 1 1/2 years.

While down slightly from the 4.3 percent GDP estimate made a month ago, the new figure demonstrated that the economy kept expanding at a strong pace during the summer, led by solid increases in consumer demand, especially for autos, and business investment.

The third quarter performance was up substantially from a 3.3 percent GDP growth rate in the April-June quarter and was the best showing since the economy expanded at a 4.3 percent rate in the first three months of 2004.

The Bush administration, which has been on a concerted campaign to highlight the economy's strong points to bolster the president's approval ratings, said the 4.1 percent GDP growth rate was evidence of a vibrant economy.

"Today's GDP is more proof that businesses are booming and investors are confident," Commerce Secretary Carlos Gutierrez said in a statement. "The U.S. economy demonstrated its resilience in the last several months."

Analysts believe growth has slowed substantially in the current quarter to between 3 percent and 3.5 percent, reflecting slower increases in consumer spending now that attractive auto incentives have been removed.

So after trumpeting last summer’s good growth numbers, only when we read deeply into the article do we see that growth has dropped “substantially” in the fourth quarter.

…An inflation gauge tied to the GDP rose at a rate of 3.7 percent in the third quarter, the fastest pace in more than a year and up from a 3.3 percent rate of increase in the second quarter.

However, excluding food and energy, the GDP inflation measure was up a more moderate 1.4 percent, the slowest increase in almost two years. Prices by this inflation measure had been estimated to have increased by an even lower 1.2 percent a month ago.

They want us to look at how good the inflation numbers are if you exclude two of the three necessities of life: food and energy. That leaves housing, and we can’t look at a drop in housing prices as good news for the economy!

While the news out of Europe and the United States is bad, things are looking up, at least for now, in Latin America. The election in Bolivia of Evo Morales can only be a good thing. Here is a translation of one of his speeches:

Evo Morales: "I Believe Only in the Power of the People"
The Bolivian indigenous leader's speech at "In Defense of Humanity" forum in Mexico City

Recorded by Adam SaytanidesTranslated by Ricardo Sala
October 25, 2003

Thank you for the invitation to this great meeting of intellectuals "In Defense of Humanity." Thank you for your applause for the Bolivian people, who have mobilized in these recent days of struggle, drawing on our consciousness and our regarding how to reclaim our natural resources.

What happened these past days in Bolivia was a great revolt by those who have been oppressed for more than 500 years. The will of the people was imposed this September and October, and has begun to overcome the empire's cannons. We have lived for so many years through the confrontation of two cultures: the culture of life represented by the indigenous people, and the culture of death represented by West. When we the indigenous people ­ together with the workers and even the businessmen of our country ­ fight for life and justice, the State responds with its "democratic rule of law."

What does the "rule of law" mean for indigenous people? For the poor, the marginalized, the excluded, the "rule of law" means the targeted assassinations and collective massacres that we have endured. Not just this September and October, but for many years, in which they have tried to impose policies of hunger and poverty on the Bolivian people.

Above all, the "rule of law" means the accusations that we, the Quechuas, Aymaras and Guaranties of Bolivia keep hearing from our governments: that we are narcos, that we are anarchists. This uprising of the Bolivian people has been not only about gas and hydrocarbons, but an intersection of many issues: discrimination, marginalization , and most importantly, the failure of neoliberalism.

The cause of all these acts of bloodshed, and for the uprising of the Bolivian people, has a name: neoliberalism. With courage and defiance, we brought down Gonzalo Sanchez de Lozada ­ the symbol of neoliberalism in our country ­ on October 17, the Bolivians' day of dignity and identity. We began to bring down the symbol of corruption and the political mafia.

And I want to tell you, companeras and companeros, how we have built the consciousness of the Bolivian people from the bottom up. How quickly the Bolivian people have reacted, have said ­ as Subcomandate Marcos says ­ ¡ya basta!, enough policies of hunger and misery.

For us, October 17th is the beginning of a new phase of construction. Most importantly, we face the task of ending selfishness and individualism, and creating ­ from the rural campesino and indigenous communities to the urban slums ­ other forms of living, based on solidarity and mutual aid. We must think about how to redistribute the wealth that is concentrated among few hands. This is the great task we Bolivian people face after this great uprising.

It has been very important to organize and mobilize ourselves in a way based on transparency, honesty, and control over our own organizations. And it has been important not only to organize but also to unite. Here we are now, united intellectuals in defense of humanity ­ I think we must have not only unity among the social movements, but also that we must coordinate with the intellectual movements. Every gathering, every event of this nature for we labor leaders who come from the social struggle, is a great lesson that allows us to exchange experiences and to keep strengthening our people and our grassroots organizations.

Thus, in Bolivia, our social movements, our intellectuals, our workers ­ even those political parties which support the popular struggle ­joined together to drive out Gonzalo Sánchez Lozada. Sadly, we paid the price with many of our lives, because the empire's arrogance and tyranny continue humiliating the Bolivian people.

It must be said, compañeras and compañeros, that we must serve the social and popular movements rather than the transnational corporations. I am new to politics; I had hated it and had been afraid of becoming a career politician. But I realized that politics had once been the science of serving the people, and that getting involved in politics is important if you want to help your people. By getting involved, I mean living for politics, rather than living off of politics.

We have coordinated our struggles between the social movements and political parties, with the support of our academic institutions, in a way that has created a greater national consciousness. That is what made it possible for the people to rise up in these recent days.

When we speak of the "defense of humanity," as we do at this event, I think that this only happens by eliminating neoliberalism and imperialism. But I think that in this we are not so alone, because we see, every day that anti-imperialist thinking is spreading, especially after Bush's bloody "intervention" policy in Iraq. Our way of organizing and uniting against the system, against the empire's aggression towards our people, is spreading, as are the strategies for creating and strengthening the power of the people.

I believe only in the power of the people. That was my experience in my own region, a single province ­ the importance of local power. And now, with all that has happened in Bolivia, I have seen the importance of the power of a whole people, of a whole nation. For those of us who believe it important to defend humanity, the best contribution we can make is to help create that popular power. This happens when we check our personal interests with those of the group.
Sometimes, we commit to the social movements in order to win power. We need to be led by the people, not use or manipulate them.

We may have differences among our popular leaders ­ and it's true that we have them in Bolivia. But when the people are conscious, when the people know what needs to be done, any difference among the different local leaders ends. We've been making progress in this for a long time, so that our people are finally able to rise up, together.

What I want to tell you, compañeras and compañeros ­ what I dream of and what we as leaders from Bolivia dream of‹ is that our task at this moment should be to strengthen anti-imperialist thinking. Some leaders are now talking about how we ­ the intellectuals, the social and political movements ­ can organize a great summit of people like Fidel, Chávez and Lula to say to everyone: "We are here, taking a stand against the aggression of the US imperialism." A summit at which we are joined by compañera Rigoberta Menchú, by other social and labor leaders, great personalities like Pérez Ezquivel. A great summit to say to our people that we are together, united, and defending humanity. We have no other choice, compañeros and compañeras ­ if we want to defend humanity we must change system, and this means overthrowing US imperialism.

That is all. Thank you very much.

So, what’s in store for Evo Morales? For some clues, here is a song, since it’s Christmas, about Jesus from Woody Guthrie, the man who fought fascism with a guitar:

Jesus Christ

Jesus Christ was a man who traveled through the land

A hard-working man and brave

He said to the rich, "Give your money to the poor,"

But they laid Jesus Christ in His grave

Jesus was a man, a carpenter by hand

His followers true and brave

One dirty little coward called Judas Iscariot

Has laid Jesus Christ in His Grave

He went to the preacher, He went to the sheriff

He told them all the same

"Sell all of your jewelry and give it to the poor,"

And they laid Jesus Christ in His grave.

When Jesus come to town, all the working folks around

Believed what he did say

But the bankers and the preachers, they nailed Him on the cross,

And they laid Jesus Christ in his grave.

And the people held their breath when they heard about his death

Everybody wondered why

It was the big landlord and the soldiers that they hired

To nail Jesus Christ in the sky

This song was written in New York City

Of rich man, preacher, and slave

If Jesus was to preach what He preached in Galilee,

They would lay poor Jesus in His grave.

Words and Music by Woody Guthrie© 1961 (renewed) and 1963 (renewed) by TRO-Ludlow Music, Inc.