The U.S. Mortgage fiasco, the 2011 English riots, and Occupy Wall Street, all made simple and easy:

The issue is not "the haves vs the have-nots"



Cassiel C. MacAvity







    Starting around 2006 in the United States, a housing price bubble finally went pop, and the amount of failed payments and foreclosures on a very large number of mortgages started to climb.

    In August 2011 in London, reactions to a police shooting mushroomed into widespread riots over 4 days in several parts of England.

    In September 2011 in the United States, numerous demonstrations started up in more and more cities across the country, with a particular focus on banking and business financial centers.

    In all of these a repeated statement is that the overall situation and problem is the haves vs the have-nots . . . but that assessment then breaks down for lack of any coherent supporting detail. Even more so the issue is not right wing extremist vs left wing extremist because the reality is basically politically neutral, or at least the problems do not particularly start from either of the political extremes.

    In actually, the reality is that of the peon vs the patrician.

    Consider a review of peon and patrician, taken from the book The Peon

    In very, very simple terms, this book is about two very different and opposing concepts. One concept states:
"I have Tea. Tea is what patricians have, and I have tea. Because I have tea, you are to admire me and openly acknowledge that I must be considered important." Rather clearly and simply, this is the undoubted and documented worldview of the peon.

    Completely in contrast, and forever the superior of the peon is the opposing concept: "Would you like a cup of tea? I don't care who you are, I don't care where you come from. If you don't want any tea, that is perfectly fine. At this moment, I can offer a cup of tea. Would you like a cup of tea?" This second and opposing concept is the worldview of the patrician.

    . . . . as much as one would prefer, the peon keeps being around, and the patrician keeps having to clean up the resulting mess. One can argue that the early 21st century recession, the collapse of the Icelandic and Irish economies, all those individuals with multiple mortgages and nothing but debt and ongoing demands for even more credit, all are fiascoes that only the peon would ever practice. Certainly no patrician is that idiotic and seeing the level of ongoing screwups that the peon manages to stage, a review and reminder of what one just does not do is always in order.


    Starting with the mortgage fiasco, let's look at a very easy outline of what has occurred, and, basically, arguably, is still occurring.

    Consider a pair of peons and a pair of patricians.

    One patrician is lower/working class or middle class, he or she has worked up to being in charge of some area at work, or has some success in business, repair or otherwise, and wants to own a house. We'll call this patrician Goodmortgage, because while Goodmortgage has some savings, the cost of a house is massively more than those savings. So with full intent to do the same sort of quality transaction that helped build up the savings, Goodmortgage goes and gets a mortgage, gets a house, and starts paying off the mortgage.

    The next patrician is middle class and works at or owns a bank---and we'll call this patrician Goodbank. A mortgage is a reliable way for a bank to make money, so when Goodmortgage came looking for a mortgage, Goodbank checked the numbers, looked at what was reasonable and likely for the handling of mortgages, and drew up the papers for them both to sign. With the mortgage created, Goodbank then started collecting the incremental payments involved in having one mortgage, which was noted on the bank's balance report as being one mortgage, being paid off in increments.

    Now lets look at a couple of peons.

    The first peon might be middle class, but the class really doesn't matter, could be lower, middle, or upper. What matters is that this peon proclaims that the economy will always soar, or, emphatically cites The Magical Scheme that All Finances Will Be Fine, or any of a number of similar outright lies. Most importantly in this scenario, this peon also proclaims that the process of a mortgage does not have to be accountable, that money is to miraculously appear---and naturally we'll call this peon Mortgagefraud. Mortgagefraud is like Goodmortgage in that Mortgagefraud doesn't have enough money to buy a house with cash. However, unlike Goodmortgage and the one house and mortgage, Mortgagefraud chose to demand at least five houses, which Mortgagefraud and anyone else equally clueless calls homes even though they're really houses. Mortgagefraud then went to a bank, lied about the amount of money available, lied about having any intent to pay off any debt, and got five mortgages.

    Clearly Mortgagefraud did not get any of the mortgages from Goodbank, because we know that Goodbank isn't an idiot, and only an idiot would let Mortgagefraud or any other peon have even only one mortgage. Such an idiot is clearly a peon, because no patrician is that idiotic. We're going to call this second peon Bankfraud. Bankfraud works at a bank, or, if Bankfraud actually has anything to do with the ownership of a bank, such ownership only followed a long string of extremely shady stock market transactions and other forms of fraud. In turn, when Mortgagefraud showed up to get the five mortgages, Bankfraud didn't check any proof of available money or any of the other practices that Goodbank does automatically as a matter of course. Furthermore, as the old story about standard peon banking goes, Bankfraud took that one cluster of five mortgages, filed the paperwork for two balance reports and . . .

    . . . sold three of them to Bankfraud's publicly listed company, using letters of credit opened by Bankfraud's brother-in-law at the bank, then executed a debt/equity swap with an associated general offer so that Bankfraud got all four reports back, with a tax exemption for five reports. The rights of the six reports were transferred via an intermediary to a Cayman Island Company secretly owned by the majority shareholder who sold the rights to all seven reports back to Bankfraud's listed company. The annual report says the company owns eight reports, with an option on one more. Bankfraud then sold one report to buy six peons in government, leaving nine reports, and intends to get all the government patricians voted out of office or fired because they keep being patricians in government. No balance sheet was provided with any stage of this. Bankfraud then demanded a bailout when the economy collapsed.

    Bankfraud also vehemently screams absolute opposition to any sort of regulated banking practices that Goodbank works within anyway because all such regulations are normal business practice and always will be. But then Goodbank is a patrician, and Bankfraud is a peon, a liar, and a failure. And yes, sometimes Mortgagefraud doesn't get five mortgages, and instead only gets one fraudulent mortgage from Bankfraud, where even just that one fraudulent mortgage gets foreclosed.

    Now having noted these two sets of behaviors, there are the instances where the foreclosure occurs, there is only one mortgage, the enraged howl occurs of How Dare You---such statement made to or by whomever---and Mortgagefraud is not the one with the mortgage this time.

    What has happened is the other occurrence in these instances of peons screwing over each other and and also screwing over any patrician that gets within range. In this case, let us consider the all too common case of Goodmortgate-Cheated, who, through no fault of his own went to BankFraud for a mortgage---After all, no bank that Bankfraud works at is going to announce the intent to commit fraud, the fraud will just get practiced. In this case, if Goodmortgage-Cheated had gone to Goodbank, Goodbank would have turned Goodmortgage-Cheated down, because of perfectly legitimate and honest reasons like not enough money, or related circumstances. Goodmortgage-Cheated isn't stupid or unreliable, but also doesn't make a living as a banker, doesn't specialize in juggling mortgage issues every single day, so therefore Goodmortgage-Cheated's quite patrician expertise is in a different area. In this case, when the circumstances occur that Goodbank would have turned Goodmortgage-Cheated down, Goodmortgage-Cheated would see what could be done, pile up more money and try again, would do whatever is needed to get the mortgage to occur, even if a little later.

    What happened instead is that when Goodmortgage-Cheated went to Bankfraud, then with full knowledge that there was no way to justify a valid mortgage, Bankfraud gave Goodmortgage-Cheated a mortgage that was guaranteed to fail. In time, through no fault of Goodmortgage-Cheated aside from choosing hope and faith instead remaining and working with reality, the mortgage did fail, rather damaging Goodmortgage-Cheated. The failure also damaged the Bankfraud bank, but, let's face it, what's going on here is that Bankfraud is a peon, not a patrician, and is rather opposed to things like accountability and honesty and trust, because such patrician practices "interfere with" Bankfraud's "lifestyle".

    Now, what do patricians and peons have to do with the riots in England and the protests in America? Go back and look at the news coverage of the riots. What will be found is numerous instances of total and undeniable working and middle class peons deliberately looting, destroying, and in a few cases, committing murder. What will be found is numerous instances of total and undeniable working and middle class patricians deliberately opposing the rioters, gathering to protect stores, to protest the setting of fires, saying in one instance "You lot piss me the fuck off! I'm shamed to be a Hackney person. Because we are not all gathering together and fighting for a cause. We are running out of Foot Locker and thiefin' shoes,"

    Of the American protests, an ongoing message that is claimed is that the point is the haves vs the have-nots, and something needs to be done about, oh, such things that, oh, aren't working.

    Actually, the better and more accurate way to frame the discussion is to note that what is going on has been and is the peons vs the patricians . . . . And as patricians of all classes, working, middle, upper, what's needed is indeed to work together to see what can and will be done to eradicate or totally cripple all peons and thus make life in our society better for all of us.
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© Cassiel C. MacAvity