The Zionists are prisoners of a bad dream: they must first free themselves, break free from the prison in which they can only play the part of tormentors, if they and especially their Palestinian victims are to live normal lives.
M. Shahid Alam
On January 12, the New York Times carried an article by David Brooks on Jews and Israel. It so caught my eye, I decided to bring its conservative author to my class on the economic history of the Middle East. I sent my students the link to this article, asked them to read it carefully, and come to the next class prepared to discuss and dissect its contents.
My students recalled various parts of the NYT article but no one could explain its substance. They recalled David Brooks’ focus on the singular intellectual achievements of American Jews, the enviable record of Israeli Jews as innovators and entrepreneurs, the mobility of Israel’s innovators, etc. One student even spoke of what was not in the article or in the history of Jews – centuries of Jewish struggle to create a Jewish state in Palestine.
But they offered no comments about Brooks’ motivation. Why had he decided to brag about Jewish achievements, a temptation normally eschewed by urbane Jews. In my previous class, while discussing Edward Said’s critique of Orientalism, I had discussed how knowledge is suborned by power, how it is perverted by tribalism, and how Western writers had crafted their writings about the Middle East to serve the interests of colonial powers. Not surprisingly, this critique had not yet sunk in.
I coaxed my students, asking them directly to explore if David Brooks had an axe (or more than one) to grind. Was there an elephant in the room they had missed? What was the subtext of the op-ed?
John Maynard Keynes died in 1946, but Keynesianism, in one form or another, is alive and well: the British economist’s name has been invoked repeatedly since the global economic meltdown began in 2008. But how much do we really know about Keynes, and what did he really say and write? Peter Clarke has written a new book about Keynes’s life and ideas.
David Harvey, author of A Brief History of Neoliberalism, and Alexander Cockburn, author of End Times: The Death of the Fourth Estate, don’t think small when it comes to change. They aren’t afraid to think about significant, even radical changes to the social order we’ve grown so used to, whether it’s requiring full employment, reimagining urban living, or repudiating credit card debt and abolishing Wall Street speculation.
Is this where Obama's financial policies are made?
Robert Hormats, Vice Chairman of Goldman Sachs, is to be installed as Under Secretary of Economics, Business, and Agricultural Affairs. This comes as one more, probably unnecessary reminder of the total control exercised by Wall Street over the Obama administration’s economic and financial policy. True, Hormats is “a talker rather than a decider” according to one former White House official, but he will find plenty of old friends used to making decisions, almost all of them uniformly disastrous for the U.S. and global economy.
Amidst the ongoing financial crisis, Nobel Prize-winning economist Joseph Stiglitz writes that in the modern era of globalization it is developing countries which provided important engines for economic growth, and therefore any global recovery will only be achieved in which they play a central role. The G20 continues to lack the political legitimacy required to represent so many citizens outwith their own borders, in which they channel their recovery packages through the IMF, an organisation whose policies “remain controversial-so much so that many countries are reluctant to turn to it for assistance”. Stiglitz writes:
This is not only the worse global economic downturn of the post World War era, it is also the first serious global downturn of the modern era of globalization. There is need for a global response to this global downturn. But our responses are framed at the national level, and often take insufficient account of the effect on others. The result is that there is less coordination than there should be, a smaller stimulus than would be optimal-and well less designed. Every crisis comes to an end, and this one will too. But a poorly designed stimulus means that the downturn will last longer, and the recovery will be slower, and more innocent victims will be hurt badly. Among the innocent victims of this crisis are the many developing countries-even countries that have had good regulatory and macro-economic policies-far better than those pursued by the US and some European countries-are being badly affected. While in the US, a financial crisis transformed itself into an economic crisis, in many developing countries, the economic downturn is creating a financial crisis. While the U.S. may have the resources to bail out its banks and to stimulate its economy, the developing countries cannot. Continue reading “A Global Recovery Needs A Global Response”
In an excellent, thorough investigation of the financial crisis in the last issue of the London Review of Books, John Lanchester had presented the scrapping of pensions in the public sector as a worst case scenario. Looks like it has already started to happen in the private sector with Barclays scrapping the pensions of its 17,000 employees. This does not, of course, affect the President Bob Diamond who last year raked in £21 m, nor does it affect the rest of the the 1,500 best paid employees. Here is Lanchester (however, let me warn that this piece is more than 14,000 words long, so you better have a good strong copy of coffee and plenty of free time before diving in; also, I’ve appended a reader’s letter correcting an accounting error made by the author):
It’s a moment of confusion and loathing that most of us have experienced. You’re in a shop. It’s time to pay. You reach for your purse or wallet and take out your last note. Something about it doesn’t feel quite right. It’s the wrong shape or the wrong colour and the design is odd too and the note just doesn’t seem right and . . . By now you’ve realised: oh shit! It’s the dreaded Scottish banknote! Tentatively, shyly – or briskly, brazenly, according to character – you proffer the note. One of three things then happens. If you’re lucky, the tradesperson takes the note without demur. Unusual, but it does sometimes happen. If you’re less lucky, he or she takes the note with all the good grace of someone accepting delivery of a four-week-dead haddock. If you’re less lucky still, he or she will flatly refuse your money. And here’s the really annoying part: he or she would be well within his or her rights, because Scottish banknotes are not legal tender. ‘Legal tender’ is defined as any financial instrument which cannot be refused in settlement of a debt. Bank of England notes are legal tender in England and Wales, and Bank of England coins are legal tender throughout the UK, but no paper currency is. The bizarre fact of the matter is that Scottish banknotes are promissory notes, with the same legal status as cheques and debit cards.
These feared and despised instruments, whose history has long been of interest to economists, come in three varieties from three issuing banks: the Bank of Scotland, the Royal Bank of Scotland and the Clydesdale Bank. Small countries with big ambitions but few natural resources need ingenious banking systems. The history of the Netherlands, Venice, Florence and Scotland show this – and so does the tragic recent story of Iceland. ‘In the 17th century, when English and European commerce was expanding by leaps and bounds,’ James Buchan wrote in Frozen Desire, ‘the best Scots minds felt acutely the shortage of . . . what we’d now call working capital; and Scots promoters were at the forefront of banking schemes in both London and Edinburgh, culminating in the foundation of the Bank of England in 1694 and the Bank of Scotland in 1695.’ The powers down south, however, came to think – or pretended to think – that the Bank of Scotland was too close to the Jacobites, and so in 1727 friends of prime minister Walpole set up the Royal Bank of Scotland.
Another excellent Guns and Butter interview with economist Michael Hudson. The interview is almost a month old but still well worth listening to. Hudson examines the death of Europe and how neoliberalism, with its favouring of property and finance over labour and industry, is driving society back to feudalism. As Gore Vidal has said, in the future, Europe will just be a big farm for China.
The Way We Were and What We Are Becoming (59:52):MP3
The Way We Were and What We Are Becoming with financial economist and historian, Dr. Michael Hudson. We begin with an analysis of the continuing bailout of insurance giant AIG and Monday’s stock market selloff; price and debt deflation; the two sectors of the economy; two definitions of ‘free markets’; the classical economists; revolution from the right and the former Soviet states; the threat of war; IMF/World Bank resurgence; the dollar versus the euro; analogies to Rome, neo-feudalism.
The Financial Barbarians at the Gate is a Guns and Butter interview with economist / historian Michael Hudson. In it he discusses the historical takeover of the economy by the finance sector.
One point of note is that the illegal war of aggression in Iraq is not a war related to economics but to the strategic interests of Israel. Hudson, explaining American Imperialism, states that “unlike England the United States didn’t have to invade countries, at least before the oil grab in Iraq” and instead drained countries through the US monetary system. It’s revealing that he suggests Iraq as a change in economic policy, it was not about economics, the oil lobby in Washington didn’t want a war, they wanted an end to brutal sanctions to gain conventional access to the oil.
Mark Braund: for a global reserve currency to work, it must be backed by a resource we want people to use less, like carbon.
A paper written ahead of the recent G20 summit by Zhou Xiaochuan, governor of the Chinese central bank, caused quite a stir. Zhou called for the establishment of a global reserve currency, a step which would firmly tip the balance of economic power in the direction of emerging economies like China and India, but would also bring benefits to poorer nations in the developing world.
Manuel Pérez-Rocha writes that “Obama should begin by laying to rest the divisive Bush legacy embodied in the PPA — as well as the SPP, the Mérida Initiative and Plan Colombia. This would signal that the United States is turning from a bullying empire into a good neighbor, from foe to friend; and that the Monroe Doctrine is finally repealed. A first test to see whether the United States is making these changes will be at the forthcoming Summit of the Americas.”
Barack Obama’s rise to the U.S. presidency has left most Latin Americans suspended between skepticism and hope. That’s bound to make the V Summit of the Americas in Trinidad and Tobago, to be held on April 18 and 19, especially interesting.
A promising sign of meaningful change in U.S. foreign policy toward the hemisphere would be the official demise of the Security and Prosperity Partnership (SPP) of North America, whose apparent failure none of the three governments so far have dared to acknowledge. This creature of Bush’s imperial presidency was agreed to and announced with great fanfare by the U.S., Canadian and Mexican presidents in 2005. Since then, it has been an obscure process in which the executive powers of the governments, along with the CEOs of 30 of the largest corporations in the three countries — many of them military contractors — have extended the security perimeter of the United States to “ensure that North America is the safest and best place to live and do business.”
M. Shahid Alam
Amidst the ongoing financial crisis, Nobel Prize-winning economist 
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