Category: Economy

The IMF Rules the World

Michael Hudson writes that “in a nutshell, the solution to a debt crisis is to be yet more debt. If debtors can’t pay out of what they are able to earn, lend them enough to keep current on their carrying charges. Collateralize this with their property, their public domain, their political autonomy – their democracy itself.”

Not much substantive news was expected to come out of the G-20 meetings that ended on April 2 in London – certainly no good news was even suggested. Europe, China and the United States had too deeply distinct interests. American diplomats wanted to lock foreign countries into further dependency on paper dollars. The rest of the world sought a way to avoid giving up real output and ownership of their resources and enterprises for yet more hot-potato dollars. In such cases one expects a parade of smiling faces and statements of mutual respect for each others’ position – so much respect that they have agreed to set up a “study group” or two to kick the diplomatic ball down the road.

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Noam Chomsky on the Economy and Democracy

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Resist or Become Serfs

Treasury Secretary Timothy Geithner is overseeing the use of billions of taxpayer dollars to protect Wall Street financiers from their bad investments. (AP photo / Susan Walsh)

‘If we do not immediately halt our elite’s rapacious looting of the public treasury we will be left with trillions in debts, which can never be repaid, and widespread human misery which we will be helpless to ameliorate,’ writes Chris Hedges. ‘The stimulus and bailout plans are not about saving us. They are about saving them.’

America is devolving into a third-world nation. And if we do not immediately halt our elite’s rapacious looting of the public treasury we will be left with trillions in debts, which can never be repaid, and widespread human misery which we will be helpless to ameliorate. Our anemic democracy will be replaced with a robust national police state. The elite will withdraw into heavily guarded gated communities where they will have access to security, goods and services that cannot be afforded by the rest of us. Tens of millions of people, brutally controlled, will live in perpetual poverty. This is the inevitable result of unchecked corporate capitalism. The stimulus and bailout plans are not about saving us. They are about saving them. We can resist, which means street protests, disruptions of the system and demonstrations, or become serfs. Continue reading “Resist or Become Serfs”

Our leaders still aren’t facing up to the scale of the crisis

Seuman Milne: “It’s hardly surprising that some want to trash the City, but to claim that the G20 protesters have no alternative is nonsense.”

When mass protests exploded on the streets of Seattle in 1999 against the kind of globalisation embodied in the World Trade Organisation, their anti-capitalist message was widely portrayed as utopian. A decade on, as anti-capitalist demonstrators vented their fury yesterday on the social and ecological vandals of the City and prepared to do battle today outside the G20 meeting in the heart of what was once London‘s docks, it looks more like common sense.

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Chomsky on Geithner and the Economy

Noam Chomsky: Plan is recycled Bush/Paulson. We need nationalization and steps towards democratization.

A Confederacy of Dunces

John Mearsheimer on The dumbing down of US economic and foreign policy elites.

Frank Rich had an excellent column in the Sunday New York Times in which he suggested that President Obama’s economic team is unsuited to deal with the financial crisis. “I fear,” he wrote, “that too many of the administration’s officials are too marinated in the insiders’ culture to police it, reform it or own up to their own past complicity with it.” Let’s hope his fears are proven wrong.

But Rich’s column points to a larger and possibly more disturbing feature of our predicament: very few of the country’s economic experts foresaw the tsunami that is now upon us. Indeed, most of them thought that the global economy was working well and needed nothing more than some tweaking here and there. This is why Obama ended up appointing a team of economic experts who not only failed to see the storm coming, but in the case of Timothy Geithner and Larry Summers, promoted policies that helped cause it. Simply put, there were hardly any sagacious business people, economists, or policymakers who he could have turned to for help.

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The Big Takeover

‘The global economic crisis isn’t about money – it’s about power’. Matt Tabibi of Rolling Stone on ‘How Wall Street insiders are using the bailout to stage a revolution’.

It’s over — we’re officially, royally fucked. No empire can survive being rendered a permanent laughingstock, which is what happened as of a few weeks ago, when the buffoons who have been running things in this country finally went one step too far. It happened when Treasury Secretary Timothy Geithner was forced to admit that he was once again going to have to stuff billions of taxpayer dollars into a dying insurance giant called AIG, itself a profound symbol of our national decline — a corporation that got rich insuring the concrete and steel of American industry in the country’s heyday, only to destroy itself chasing phantom fortunes at the Wall Street card tables, like a dissolute nobleman gambling away the family estate in the waning days of the British Empire.

The latest bailout came as AIG admitted to having just posted the largest quarterly loss in American corporate history — some $61.7 billion. In the final three months of last year, the company lost more than $27 million every hour. That’s $465,000 a minute, a yearly income for a median American household every six seconds, roughly $7,750 a second. And all this happened at the end of eight straight years that America devoted to frantically chasing the shadow of a terrorist threat to no avail, eight years spent stopping every citizen at every airport to search every purse, bag, crotch and briefcase for juice boxes and explosive tubes of toothpaste. Yet in the end, our government had no mechanism for searching the balance sheets of companies that held life-or-death power over our society and was unable to spot holes in the national economy the size of Libya (whose entire GDP last year was smaller than AIG’s 2008 losses).

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Economist Ha-Joon Chang on the Financial Crisis

The brilliant Cambridge economist Ha-Joon Chang, author of Bad Samaritans and Kicking Away the Ladder, on “The Myth of Free Trade and the Secret History of Capitalism”. (Also see Chalmers Johnson’s excellent review of Bad Samaritans). The following is available from DN! as Real Video Stream, Real Audio Stream and MP3 Download.

AMY GOODMAN: The US government has poured hundreds of billions of dollars into the US economy in the wake of the financial crisis. But what steps are being taken to address the crisis on a global scale? On Sunday, the World Bank warned of the first global recession since World War II, with the world economy set to shrink for the first time since the 1940s. The bank also cautioned that the cost of helping poorer nations in crisis would exceed the current financial resources of multilateral lenders. The economic crisis is projected to push around 46 million people into poverty this year.

The financial crisis is forcing some to rethink the neoliberal policies widely blamed for the financial collapse. On Monday, British Prime Minister Gordon Brown called for a new international fund to support poorer countries during the global recession. He also acknowledged richer Western nations have often imposed economic policies on poorer countries that they haven’t followed themselves. Continue reading “Economist Ha-Joon Chang on the Financial Crisis”

The Take: Occupy, Resist, Produce

With a massive economic crisis underway I thought it timely to post The Take by Naomi Klein and Avi Lewis on Argentina’s experience. An inspirational look at how workers reacted to losing their livelihoods by occupying their factories, resisting the authorities and co-operatively producing goods for the benefit of themselves and their communities.

In suburban Buenos Aires, thirty unemployed auto-parts workers walk into their idle factory, roll out sleeping mats and refuse to leave. All they want is to re-start the silent machines. But this simple act – the take – has the power to turn the globalization debate on its head. Armed only with slingshots and an abiding faith in shop-floor democracy, the workers face off against the bosses, bankers and a whole system that sees their beloved factories as nothing more than scrap metal for sale. With The Take, director Avi Lewis, one of Canada’s most outspoken journalists, and writer Naomi Klein, author of the international bestseller No Logo, champion a radical economic manifesto for the 21st century.

Where the Cheats Have No Shame

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To celebrate the release of new U2 fluff, here is Harry Browne’s take on Bono.

Entries have already been pouring in to the ‘rewrite a U2 song’ competition in honour of the group’s Irish tax-exile status, as described here on Counterpunch by Eamonn McCann. ‘Where the Streets Have No Name’ has been recast as ‘Where the Cheats Have No Shame’, ‘Angel of Harlem’ as ‘Arrangement in Holland’ — and those are just the entries from my house.

But CounterPunchers are rarely less than fair, so we just had to read more when we saw this news intro on page-one of today’s Irish Times: “U2 singer Bono says he was ‘stung’ and ‘hurt’ by criticism of the band moving part of its business to the Netherlands to lessen its tax burden.”

Oh, Bono, dear Bono. Is that a tear I see in your eye, behind the wraparound shades? No, maybe not. As the interview with Bono in the newspaper demonstrates yet again, this is indeed a man entirely without shame. And also not too well endowed in the smarts department. His main excuse — all the other corporate entities were doing it — is a childish abdication of moral responsibility. And as another excuse he adds, “I can’t speak up without betraying my relationship with the band” — i.e. maybe this wasn’t really my idea but I’ve got to stick with my greedy pals. Well, that’s just low.

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