Why Central Banks?

I have long argued that the interest-based, debt-money, central banking regime is both dysfunctional and destructive, and advocated for the decentralization of control over credit and the creation of exchange alternatives that use privately issued currencies and direct clearing of accounts among buyers and sellers.

There is a considerable body of literature that makes the case for free money and free banking, most of which has been ignored. These ideas have been overwhelmed by the economic and financial orthodoxy which stands in support of the political status quo which centralizes power and concentrates wealth.

For governments, central banks serve as “lenders of last resort,” enabling deficit spending through their purchase of government bonds and manipulation of interest rates, while for the banking cartel, government serves as “borrower of last resort,” sustaining their privilege of lending money into circulation and charging interest on it. Whenever this unsustainable system threatens to implode (as it did in the crisis of 2008), the government steps in to take bad (private) debts off the bankers’ hands and place them on the shoulders of the citizens (“bail-outs”). When the next bubble reaches its climax, we will likely see another round of “quantitative easing,” but when that proves to be inadequate, we will likely see some combination of inflation and outright asset confiscation known as “bail-ins” (partial seizure of bank balances).

In his recent review, Leonidas Zelmanovitz, highlights the main points in Vera Smith’s book, The Rationale of Central Banking and the Free Banking Alternative, which was published in 1936. Paraphrasing Smith, Zelmanovitz concludes that [Keynsian policies are] “not necessary to solve the problems they are purported to solve; most likely, they are part of the cause of the problem. Furthermore, there is an alternative, and that alternative is free banking,.” and, ” You can have good money without central banking and central banking does not guarantee good money.” You can read the entire review on the EconLib website.

Another classic source on free banking is Henry Meulen‘s, Free Banking (London: Macmillan, 1934). Free download available here. I will provide some excerpts from that source in a future post.


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President Donald Trump – the first two years


The American people elected Donald Trump to shake things up, and, for better or for worse that is what he’s been doing. Most of what Trump has done in the first two years of his presidency has been destructive—to the environment, to social justice, to economic equity, and to civil discourse. But whether he knows what he is doing or not, he has been shaking up America’s longstanding foreign policy in a way that I think is positive. The United States, under both major parties, has, since the fall of the Soviet Union, been working to maintain “full spectrum dominance” around the world. It has been bent upon constraining the power and influence of potential rivals like Russia and China, and promoting by both overt and covert means, regime change in numerous countries around the world in hopes of installing puppet regimes that would be subservient to the demands of the “New World Order.”

Trump may very well be a narcissistic “loose cannon,” and his intentions may be purely self-centered and aimed at self-aggrandizement, but many of his foreign policy actions are moving the world in the direction that it needs to go, i.e., towards a multi-polar world order. He is doing this by (1) trying to cooperate and normalize relations with Russia, (2) pressuring Britain and Western European (NATO) allies, thus undermining longstanding alliances, and (3) upsetting prior trade agreements via the imposition of tariffs.

The turmoil in Washington politics has at times been almost comical, as we’ve seen the evident tug of war between a strong-willed President with his own ideas, and the entrenched “deep state” that is controlled by the elite global power establishment. This has been evident in some of the presidential appointments that seem at odds with Trump’s rhetoric, like the appointment of super-hawk and Russophobe, John Bolton as national security advisor.

The appointment of John Kelly, as White House Chief of Staff, was supposed to control Trump, but now Trump has ousted Kelly and named Mick Mulvaney as his temporary replacement. Does that indicate a power shift in Trump’s favor? Or now that the Democrats have taken control of the House, will they be able to tie Trumps hands?

Time will tell.

Thanksgiving Newsletter 2018

In the United States, the fourth Thursday in November is designated as Thanksgiving Day, a national holiday. Days of thanksgiving were variously celebrated in the colonies from very early times, but the national holiday we celebrate today was proclaimed in 1863, in the midst of the Civil War, by President Abraham Lincoln. It is fitting that we take time to remember the many blessings that each of us enjoys, even in the most dire circumstances.

What we consistently fail to do is to recognize the misery that our actions may be causing for others. While individually, the way we live our lives may be exemplary, our collective circumstances often derive from less than benevolent actions take on our behalf by political and economic leaders. One need not look very deeply to see the absurdity of the present world order that is based on perpetual war and struggles for dominance among national and supra-national elites. When one considers the marvelous technological advances and the vast amounts of material wealth that humans have been able to produce, it is clear that no one in this world should need to live in squalor. Yet, vast numbers of our brothers and sisters around the world lack the barest necessities to live a dignified life, much less the resources needed to realize their full potential. Still others are being terrorized, bombed, detained and persecuted through no fault of their own.

The hard question for me is, “How am I complicit in all of this, and what can I do about it?”

While driving in my car I often have the radio tuned to the local NPR station. A couple of days ago I happened to hear an episode (Ep. 356) of the popular Freakonomics program, this one titled, America’s Hidden Duopoly. The discussion was about the American two-party political system, which is in essence a duopoly of political power. Many Americans have long lamented the fact that they are often required to make a choice between “the lesser of two evils.” Third parties come and go by none has ever gained enough support to offer anything but “a wasted vote.”

Is there some other way in which the problem can be addressed? One initiative mentioned in the interview that seems to hold some promise is Unite America. Their motto is Country Over Party and their focus is on “building a movement to elect common-sense, independent candidates to office who can represent We, the People – not the party bosses or special interests.” The way they propose to achieve that is through their “Fulcrum Strategy,” that is “focused on electing independent candidates to narrowly divided legislatures, like the US Senate, where they can deny both parties an outright majority and use their enormous leverage to forge common ground solutions.” The argue that it would take only 4 or 5 independent Senators to swing the balance of power.

Hmmm, that itself is a tall order, but it just might work. Another initiative that looks promising is World Beyond War.
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David Brooks is a familiar figure on the PBS News Hour, where he has for years been providing political commentary alongside Mark Shields. I can’t say that I’ve been all that impressed with him, but after a friend referred me to a presentation he gave at the 2018 Pacific Summit earlier this year I came away with a different opinion. I find Brooks much more impressive and insightful as a social philosopher and historian. He articulately and entertainingly provides an assessment of our present sociopolitical predicament. I recommend that you can view that presentation on YouTube.

Still, I have a little different take on the situation, something that no one else seems to be seeing. Arnold Toynbee is quoted as having said, “Civilizations start to decay when they lose their moral fiber and the cultural elite turns parasitic.” That is the situation we find ourselves in today. Our political leadership has let us down. When the power elite works to dominate and exploit us, when they can no longer be trusted to tell us the truth,  when they fail to act on behalf of peace and the common good, what is there but to revert to tribal identities and find common cause with those whom we know and trust? While pundits and politicos decry the rise of “populism,” I see it as a natural response to the failure of the power elite. Populist actions are not always tainted by racism, sexism, and scapegoating. We need to rebuild society from the bottom up, starting with the people around us, then branching out to form alliances and coalitions. But if we are to end up with something better than what we wish to replace, our actions need to be open-hearted and beneficent. With good will toward all, perhaps it is possible to have a populist revolution that is peaceful and advances the causes of social justice, economic equity, individual liberty and human unity.
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The American Economy Is Rigged

In a recent article, Joseph E. Stiglitz, former chief economist of the World Bank, argues that the American economy is rigged and outlines a few things that we can do about it.

Stiglitz begins his article by saying:
“Americans are used to thinking that their nation is special. In many ways, it is: the U.S. has by far the most Nobel Prize winners, the largest defense expenditures (almost equal to the next 10 or so countries put together) and the most billionaires (twice as many as China, the closest competitor). But some examples of American Exceptionalism should not make us proud. By most accounts, the U.S. has the highest level of economic inequality among developed countries. It has the world’s greatest per capita health expenditures yet the lowest life expectancy among comparable countries. It is also one of a few developed countries jostling for the dubious distinction of having the lowest measures of equality of opportunity.”

 

 

He then explains how economic inequality and political inequality are mutually reinforcing, each growing in response to growth in the other. When the super-rich are able to make the rules, they can rig the game to become ever richer. He concedes that “There is no magic bullet to remedy a problem as deep-rooted as America’s inequality. Its origins are largely political, so it is hard to imagine meaningful change without a concerted effort to take money out of politics.”

Stiglitz outlines a number of measures that could achieve that but all of them require legislative action. That seems like a “catch 22.” If the political machinery is so thoroughly in the hands of the economic and political elite, how is it possible to use the political process the change the status quo? I have long argued that, in view of that political reality, the only viable strategy is to design and deploy  innovative monetary and financial systems that enable us reclaim “the credit commons.” By decentralizing the control of credit, it is possible to reduce our dependence upon bank borrowing and political forms of money. This is not so far-fetched as it might first appear. For details of how it can be, and is being done, see my article, Confronting the power elite.

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Free speech on the ropes

big-brother quotes

If liberty means anything at all, it means the right to tell people what they do not want to hear.     —George  Orwell

What the Arab world needs most is free expression.    —Jamal  Khashoggi

In his famous dystopian novel, 1984, George Orwell describes a world in which people’s actions and words are closely monitored in order to detect and punish thoughtcrime.  It is a world in which the ruling power structure has the means to preempt the expression of any idea or story that might challenge the official narrative of events and reality. Though a little late by Orwell’s reckoning, that world has all but arrived.

The development of the internet and the worldwide web brought, for a time, tremendous power to ordinary people to communicate and inform one another directly, bypassing the established news filters and centralized control of information. But in recent years, new corporate megaliths have emerged that have the power to shift control back in favor of “Big Brother.” We have become so dependent upon private corporate media platforms, like Facebook, Twitter, Google and YouTube, that they are able to manipulate our thoughts and behavior. To be banned from those channels means to effectively be banished from participation in political discourse. Corporate power on such a scale inevitably ends up being complicit with political oligarchies in controlling  public perceptions and defining “reality.” The hyped-up battle against “fake news” is really a battle against free speech.

Facebook teams up with the “Thought Police” to purge dissenting voices

Facebook’s purging of hundreds of pages and accounts in recent days has been widely reported. The purges have been done based on allegations of “spam,” and “inauthentic behavior,” or of providing  “Russian propaganda.” But there’s much more to it than that.

An article in the online journal, Global Research, describes the arrangement that Facebook made five months ago with the Atlantic Council to,  “prevent [their] service from being abused during elections.” And who is the Atlantic Council? According to the article, the Atlantic Council “is a think tank that is essentially funded by NATO, weapons manufacturers, Middle-Eastern oil-state monarchies, billionaires and different branches of the US military. In short, it has been described as being nothing less than NATO’s unofficial propaganda wing. The Atlantic Council doesn’t shy away from its political intents across the world, which can be seen solely by looking at who sits on its directors board – the crème de la crème when it comes to US neocons & war criminals: Henry Kissinger, Condoleezza Rice, Frank Carlucci, James A. Baker, R. George P. Shultz, James Woolsey, Leon Panetta, Colin Powell, Robert Gates, and many more.”

The article goes on to say that, “Many of the pages and accounts taken down have been political (often leftist), anti-war, independent journalists and media outlets that are known to go against the grain of mainstream media outlets.” You can read the complete article here.

So, what can we do? Let’s all dump Facebook, as well as Twitter, YouTube and all the other  massive, proprietary, data mining and propaganda platforms. I know that is not so easy to do, but alternatives do exist, and more of them are emerging every day. Here is a list of 6 Alternatives to Facebook. This article provides a list of 11 Facebook alternatives, and Fox News, surprisingly, provides a list of, Secure alternatives to Facebook, Instagram and Twitter. My search engine, DuckDuckGo, turns up several more.

One Facebook alternative that has gotten significant funding support of late is MeWe. A recent article reports that MeWe has thus far managed to raise $10 million to support its development. The article quotes MeWe founder and CEO, Mark Weinstein: “It is clear that the world wants a better social network that treats its member as customers to serve, not data to sell. We’ve built a social networking experience that has a remarkable suite of features people love and none of the BS. MeWe has no ads, no spyware, no content manipulation, no facial recognition, and no Russians (or anyone) paying to show you fake news.”

Well, that sounds promising, but time will tell how real it is.
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Jamal Khashoggi’s murder and the U.S./Saudi connection

The sensational case of the murder and dismemberment of Washington Post journalist, Jamal Khashoggi, inside the Saudi Consulate in Istanbul, underlines just how desperate the power elite is to control the narrative and manipulate our perceptions and beliefs. It would be a mistake to view this horrendous atrocity in isolation from the wider geopolitical propaganda campaign, much of it emanating from the U.S. government and their NATO and middle-eastern allies.

Two weeks after Khashoggi’s disappearance, The Washington Post published his last editorial, in which Khashoggi wrote:

“Arab governments have been given free rein to continue silencing the media at an increasing rate. There was a time when journalists believed the Internet would liberate information from the censorship and control associated with print media. But these governments, whose very existence relies on the control of information, have aggressively blocked the Internet. They have also arrested local reporters and pressured advertisers to harm the revenue of specific publications.”

The reaction of Donald Trump to this affair has been what we would expect. While paying lip service to justice and accountability, he immediately tried to provide cover for the Saudi regime by suggesting that the murder may have been the work of “rogue killers.” He also made it clear that he would not halt weapon sales to the Saudi government, a clear signal that money trumps “American values,” and belies the myth of the United States as champion of democracy and human rights.

But the cozy relationship between Saudi Arabia and the United States goes back way before Trump. Recall that, according to the official report on the 9/11 terror attacks on the World Trade Center and the Pentagon, 15 of the 19 terrorists were from Saudi Arabia. Why then did the United States attack Iraq and Afghanistan instead? It is also established fact that the Bush family and the bin Laden family were longtime business associates. Furthermore, according to this article by Cindy Rodríguez in the Denver Post, “While all flights were halted following the terrorist attacks, there was one exception made: The White House authorized planes to pick up 140 Saudi nationals, including 24 members of the bin Laden family, living in various cities in the U.S. to bring them back to Saudi Arabia, where they would be safe. They were never interrogated.”

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Commercial Trade Exchange Architecture and Operations—A Conversation with Chip Davis and Charlie Davis by Thomas H. Greco, Jr.

Recently, I came across an article about what seems to be a significant development in the commercial trade exchange industry. Published on February 15, 2018, the article, TradeAuthority rebrands as Moxey with new digital currency, national expansion plans, tells about the expansion and rebranding of a commercial trade exchange heretofore known as TradeAuthority. Operating for the past several years in the Gulf Coast region of the southern United States, TradeAuthority has developed along lines somewhat different from most other trade exchange companies. I’ve had some peripheral knowledge of TradeAuthority for a long time but after reading the article I decided it was time for me to reach out to its founder, Chip Davis, with the intention of gaining a more detailed picture of how they operate and their plans for further development and expansion. The company, now named Moxey, is a network of 14 autonomous member-owned local trade exchanges, member ownership being a unique feature in the commercial trade exchange industry.

The key players in the Moxey enterprise are Chip Davis, founder of TradeAuthority and current  Executive Vice President of Moxey, Charlie Davis, President of Moxey, and Warren Sager, Moxey Vice President of Operations.

Some Key Questions 

In my message to Chip Davis, I posed the following questions:

  • What degree of autonomy do the various (14) exchanges in your network have?
  • Is it possible for a member in one exchange to buy/sell directly with a member of another exchange in the network? Does your platform provide that functionality or does the trade need to be pre-arranged with brokers in the two exchanges?
  • Is there a single Moxey ledger for the entire network or does each exchange have its own? If the latter, how are accounts reconciled among the exchanges, and how often?
  • Do you participate in UC? [UC is “Universal Currency,” a credit currency that many trade exchanges use to enable their members to buy goods and services from members of different trade exchanges.]
  • What are the factors you use to allocate lines of credit? How are they weighted? Are all exchanges in the network required to apply the same algorithm in allocating credit lines to their members?
  • You say, “Moxey intends to be a better Medium of Exchange by removing the concern of inflation.” How does it do that?
  • Is you online portal a complete marketplace that includes offers and requests? Vendor and client background? Reputation ratings?
  • When using the app or online portal, is approval of the transaction immediate?
  • You also say, “It also removes the extreme deflationary dangers that can exist in a purer form of money such as gold.” Can you explain that?
  • What additional functionality will be achieved by using blockchain? “The major thing behind all currencies is a trust and transparency in knowing the currency is strong and blockchain technology will allow an additional level of transparency,” says Warren Sager, Moxey vice president of operations. “It will allow our currency to become stronger and more trustworthy.” But that does not address the transparency of the credit allocation process. Please comment.
  • The trade exchange industry seems to have been for some time on a plateau or slow growth trajectory. How do you see moneyless trading alternatives evolving over the next few years, and how much of an increase in scale do you anticipate?

You can read Chip’s and Charlie’s answers, and our full conversation by clicking here. –t.h.g.

Who is interfering with whom?

Virginia State Senator Richard Black addressed the June 30, 2018 Schiller Institute conference via video. In his presentation titled, The True Interest of the United States, Senator Black, a combat veteran, argued that “U.S. foreign policy in Iraq, Libya, Syria and elsewhere in South-West Asia, …has spawned huge armies of terrorists,” and in no way benefits the interests of the American people.

And a vintage article by William Blum, recently republished by Global Research, highlights the hypocrisy of U.S. government officials and the media in blasting Russia for their alleged interference in the U.S. political process, while the U.S. government has a long and sordid history of extreme interference in other countries. I count 55 instances in William Blum’s list of “the United States overthrowing, or attempting to overthrow, a foreign government since the Second World War.” See it here:  Overthrowing Other People’s Governments: The Master List of U.S. “Regime Changes.” –t.h.g.

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2018 Summer Newsletter

My latest article
What we can and cannot afford
New Warrior Training Adventure and the Mankind Project (MKP)
The developing business of commercial trade exchanges
Other Items of interest

NowDonnyCaptioned

My latest article

How has extreme centralization of power and concentration of wealth come about? What are the pillars upon which the global power structure rests? How can power be decentralized and dispersed more broadly to enable people to live in peace and freedom?

These are questions I addresses in my latest article, Confronting the power elite, An abridged version was published a few days ago by Open Democracy in their online journal Transformation. It was then picked up by the Post Carbon Institute and republished in their journal Resilience. Here is an excerpt from the original:

The world today is controlled by a small elite group that has been increasingly concentrating power and wealth in their own hands. There are many observable facets to this power structure, including the military security complex that president Eisenhower warned against, the fossil fuel interests, and the neocons that are promoting U.S. hegemony around the world, but the most powerful and overarching force is “the money power” that controls money, banking, and finance worldwide. It is clear that those who control the creation and allocation of money through the banking system are able to control virtually every other aspect of global society.

Having taken control of the political leadership in North America and western Europe, they are determined to use military force, if necessary, to create a unipolar world order in which the power elite enjoy “full spectrum dominance.” Based on a long established pattern of covert and overt interventions, it is evident that they are willing to employ, either directly or through proxies, a wide range of tactics, including propaganda, bribery, cooptation, deception, assassinations, false-flag attacks and war. Large segments of the media and entertainment industries, education, and the military power have been captured to help manufacture public consent.

Be that as it may, I believe that the natural course of human evolution tends toward a multi-polar world order based on honesty, openness, compassion, cooperation, and fairness, but that requires a well-educated and informed populace and “broad spectrum” participation in the political process. Fortunately, the internet and world wide web have enabled people to be better informed than ever before and to engage with one another directly, bypassing intermediaries that control and limit what people can share. On the other hand, the political machinery has been so thoroughly taken over by the power elite that the will of the people has thus far been of little consequence in deciding the course of world affairs.

So what can be done to turn the tide? How can we the people empower ourselves to effectively assert our desires for a more fair, humane and peaceful world order? Is it possible to influence the behavior of those in power? Or is it possible to install new leaders who will act more responsibly and in accordance with the popular will? Or is it necessary, or even possible, to reinvent and deploy political and economic structures by which people can more directly assert themselves?
Read the entire article here.
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What we can and cannot afford is another article that I published on my website about the same time. This is a subject that gets far too little attention in the political debate and thus we remain burdened with “sacred cows” that are driving us to destruction.

  1. We cannot afford continuation of the Empire with its deployment of military forces around the world and endless overt and covert warfare.
  2. We cannot afford continuation of the interest-based, debt-money regime that forces unnecessary expansion of economic activity and centralizes power and concentrates wealth in the hands of a super elite.
  3. We cannot afford continuation of the environmental destruction and climate change that is caused by the fossil fuel based economy.

Read the full article here.
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New Warrior Training Adventure and the Mankind Project (MKP)
For almost a year now I’ve been participating in a biweekly men’s circle associated with the Mankind Project, a community in which men support one another in achieving self-awareness, finding purpose, taking responsibility, and becoming compassionate servants to their communities and the planet. The first weekend in May I participated in the New Warrior Training Adventure at a ranch in central Arizona. It was a significant experience that helped to boost my confidence, self-esteem, and emotional maturity—just what I needed at a time when I was feeling a bit lost and dissatisfied with the results of my work. The training helped me to identify imbalances in my life, accept reality, and clarify my purpose going forward. I now feel more grounded and motivated, and connected and supported by a growing brotherhood of “new warriors.” I highly recommend the NWTA to any man who seeks to improve himself and his relationships. It was no surprise that I was the oldest man there, but I can testify that self-inquiry and stretching ones’ limits are appropriate endeavors at any stage in life.
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The developing business of commercial trade exchanges

Recently, I came across an article about what seems to be a significant development in the commercial trade exchange industry: Trade Authority rebrands as Moxey with new digital currency, national expansion plans. I’ve been aware of the Trade Authority exchange for several years but had not taken a close look at it. I’ve lately been dialoging with Chip Davis, founder of Trade Authority and currently Executive Vice President of Moxey, and with others in the Moxey executive team. Moxey, a network of 14 trade exchanges operating around the Gulf coast, is unique in the industry in that the various exchanges in the network are each member-owned.

Based on the answers to my questions that I have received so far, it appears that Moxey has avoided the common mistakes that have limited the effectiveness of some other trade exchanges and prevented them from realizing their full potential (For more about that see this excerpt from my book, Chapter 15 Limiting Factors in the Operation of Commercial Trade Exchanges). At some point in the near future, I will publish my interview with the Moxey leadership. Watch for it on https://beyondmoney.net/.
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Other Items of interest

The Bank Bailout
The Big Bank Bailout appeared in Forbes magazine a couple years ago. As another financial crisis looms on the horizon, it is still relevant, describing  in detail the forms and extent of the bank bailout that began in 2008 and continues to this day.

Malaysia
Over the past 11 years, I’ve spent a lot of time in Malaysia. Upon my first visit I discovered that Malaysia is not some poor, insignificant Asian backwater but a country with a well-developed infrastructure and geo-political importance—a country worth getting to know. The recent election unseated the party that has governed Malaysia since its founding in 1957 and saw the surprising return to power, at age 92, of Mahathir Mohamad, the man responsible for Malaysia’s modernization.
This New York Times article tells the story, A Stunning, Sudden Fall for Najib Razak, Malaysia’s ‘Man of Steal’. And this comment, Endearing courage of Malaysians rescued country from the brink…, provides additional background and insight into the significance of the election outcome.

Russia and Syria
Anyone who wishes to understand geopolitics needs to have a broad purview and not rely simply upon mainstream media sources which seldom provide more than a one sided and biased perspective. This is especially true of the coverage relating to Russia and Syria.

Despite President Trump’s repeated statements about his desire to normalize relations with Russia, others in his administration and the mainstream media continue their barrage of unsubstantiated allegations against both the Russian and Syrian governments. In his Nation article, Stephen F. Cohen, professor emeritus of Russian studies at NYU and Princeton,  provides some counterweight to the anti-Russian hysteria arguing that, “Given a chance, Russia can be a vital peacemaker, and there is ample reason to think that the Kremlin is ready to do so if again met halfway by Washington.” Will Trump’s handlers and the deep state allow that to happen? That seems unlikely but time will tell.

Columbia University Professor Jeffrey Sachs tells the truth about US involvement in the Syria catastrophe on The Jimmy Dore Show, Bombshell: Professor Stuns MSNBC Panel On Syria, and in this excellent interview Between the Lines.
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There is much more that I could include in this message but I know you have many other things vying for your attention so I will leave it at that.

Regarding travel, other than my brief visit to family on the east coast in early June, I’ve not been traveling since my journey to Greece a year ago. I’m still hoping to get away for a few weeks this summer but my plans remain open.

Wishing you all a pleasant summer,
Thomas