Fiscal Ruin of the Western World Beckons
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/585707...
"For a glimpse of what awaits Britain, Europe, and America as budget deficits spiral to war-time levels, look at what is happening to the Irish welfare state..."
The severity of the current crisis and the failure of conventional economics to anticipate or account for it draw attention to what radical economist Duncan Foley has called "Adam's Fallacy." Named for Adam Smith, Adam's Fallacy is "the idea that it is possible to separate an economic sphere of life, in which the pursuit of self-interest is guided by objective laws to a socially beneficent outcome, from the rest of social life, in which the pursuit of self-interest is morally problematic and has to be weighed against other ends." Adam's Fallacy is thus both an intellectual and moral fallacy ....
Foster notes some of his recent work with Fred Magdoff in The Great Financial Crisis:
Growing out of the earlier work of Marxian political economists Paul Baran and Paul Sweezy in Monopoly Capital, our book challenges the prevailing assumption that the capitalist economy naturally promotes rapid growth and full employment equilibrium -- a viewpoint that makes persistent unemployment, underemployment, and slow growth anomalies that need to be explained.8 Rather we argue the opposite -- slow growth, rising unemployment, underemployment, and excess productive capacity comprise the normaltendency under monopoly capitalism. In this view, rapid growth and full employment, as in the "golden age" of the 1950s and '60s, are the anomalies that need to be explained.The virtue of this approach is that it conforms much more closely to reality.
Foster addresses the ongoing, inherent problem of capitalist stagnation, draws attention to the "external" factor of military spending as a way to address stagnation, outlines the financialization process since the 1980's that did the same thing, and we have the following:
It was clear from the start that financialization could not solve the underlying problem of stagnation, and that a reckoning -- what economists call a mean reversion in which finance would be brought more in line with the slow growth of the underlying economy -- would eventually have to occur.
As predicted, it DID occur. In conclusion,
All of this points to the fact that we live in an age when more than ever before the world demands a radical synthesis: of the kind potentially offered by political economy, economic sociology, and ecological economics. The closed world of make-believe neoclassical economic models, of Adam's Fallacy, has become a growing threat to the planet and all who live in it.
Adam's Fallacy and the Great Recession
If CEOs and such can commit financial fraud and get away with it, more of those less well-off might well come to the conclusion that they can too. That seems to be borne out by the figures on reported fraud in the US.
http://www.economist.com/daily/chartgallery/displaystory.cfm?story_id=14...
The price of oil is dropping, how could that be? 
Easing the transition to an alternative economy by Kevin Carson
Th price of crude oil is still falling, presently being $63.21 US a barrel.
Down, down, it goes. Where it stops nobody knows.
And here are the forecasts for the months to come. But, but, how could that be you say. 
Crude Oil Price Forecast
West Texas Intermediate Spot Price. USD/bbl. Average of Month.
Month
Date
Forecast
Value
50%
Correct +/-
80%
Correct +/-
0
Jun 2009
69.7
0
0
1
Jul 2009
62
6
14
2
Aug 2009
61
8
18
3
Sep 2009
60
9
20
4
Oct 2009
55
10
22
5
Nov 2009
49
10
23
6
Dec 2009
41
11
25
7
Jan 2010
43
11
26
8
Feb 2010
48
12
27
So much for the chart idea.
The Chinese Came Calling...
http://www.truthdig.com/report/item/20090729_the_chinese_come_calling/?ln
"China has a huge amount of investment in the United States, mainly in the form of Treasury bonds. We are concerned about the security of our financial assets," was the way China's assistant finance minister put it.."
I'm shocked, I tell you, I'm shocked.
Shell warns of job cuts as profits fall 70%
'Substantial further staff reductions are likely,' company says
http://www.guardian.co.uk/business/2009/jul/30/shell-profits-job-cuts-li...
Victor Vangelakos lives in a luxury condominium tower on the Caloosahatchee River. He never has to worry about the neighbors making too much noise.
There are no neighbors. Vangelakos, 45, his wife Cathy and their three children are the only residents in the 32-story Oasis I condo on the east edge of downtown Fort Myers.
http://www.news-press.com/article/20090730/NEWS0110/90729077/1002/RSS01
Global Europe Anticipation Bulletin: When China Prepares Its Great Escape from the US Dollar Trap for the End of Summer 2009
http://www.leap2020.eu/When-China-prepares-its-Great-Escape-from-the-dol...
"a large part of the other members of the G20 are clearly in favor of a quick shift to a post-Dollar era, in particular Russia, India, South Africa, Argentina, Brazil..therefore Beijing will not be alone when the time for a "Great Leap Forward" comes."
International Banks Exploit Crisis to Reap Massive Profits
http://www.globalresearch.ca/index.php?context=va&aid=14586
"Less than a year after the eruption of a financial crisis that has devastated economies across the globe and wiped out an estimated 40 percent of the world's wealth, a number of major banks and investment houses are posting record profits..The article quotes the head of German operations of an international investment bank who declares: "the taxpayer is paying for the chips at the casino - it doesn't get any better.."
[url=http://www.newamerica.net/publications/policy/america_s_exhausted_paradi...'s Exhausted Paradigm: Macroeconomic Causes of the Financial Crisis and Great Recession[/url]
> Thomas Palley
This report traces the roots of the current financial crisis to a faulty U.S. macroeconomic paradigm. One flaw in this paradigm was the neo-liberal growth model adopted after 1980 that relied on debt and asset price inflation to drive demand. A second flaw was the model of U.S. engagement with the global economy that created a triple economic hemorrhage of spending on imports, manufacturing job losses, and off-shoring of investment. Deregulation and financial excess are important parts of the story, but they are not the ultimate cause of the crisis. Instead, they facilitated the housing bubble and are actually part of the neo-liberal model, their function being to fuel demand growth based on debt and asset price inflation. The old post-World War II growth model based on rising middle-class incomes has been dismantled, while the new neo-liberal growth model has imploded. The United States needs a new economic paradigm and a new growth model, but as yet this challenge has received little attention from policymakers or economists.
[url=http://www.nytimes.com/2009/08/01/business/economy/01charts.htm]A US economy increasingly based on war[/url] This is the economy our two old line party stooges decided Canadians should hook our wagon and economic fortunes to with CUSFTA, NAFTA, SPP, TILMA, and deep integration.
Foreign Investment in the US - Going Down, Down, Down:
http://www.financialsense.com/editorials/casey/2009/0728.html
"but the fact remains that the foreign holders of US dollars have it within their ability - either deliberately or inadvertently as the result of a panic setting in - to literally destroy the US currency.."
[url=http://globalresearch.ca/index.php?context=va&aid=14704]Bankrupt US Financial System: The Bubble Bursts and the Economy goes into a Tailspin[/url]
The World needs a breather from the US. And they'll get it sooner than many think
We're making this way too complicated. It's simple really. The Fed has only one tool at its disposal; to create more money. Typically, the way the Fed adds to the money supply is by lowering interest rates. When the Fed lowers rates below the rate of inflation; they're basically selling dollars for under a buck. That's a good deal, so, naturally, speculators jump on it and trigger a credit expansion. What follows is a frenzy of market activity that ends in a housing, credit, tech or equity bubble. Eventually, the bubble bursts and the economy goes into a tailspin. Then, after a period of digging-out, the process resumes again. Wash, rinse, repeat. It's always the same. The moral is: Cheap money creates bubbles; and bubbles move wealth from workers to rich motherporkers. It's as simple as that. That's why the wealth gap is wider now than anytime since the Gilded Age. The rich own everything.
Bernanke's and Politburo's backs are against the wall.
There Is No Recession
http://www.counterpunch.com/whitney08102009.html
"It's a planned demolition.."
Fiscal Ruin of the Western World Beckons
http://globalresearch.ca/index.php?context=va&aid=14734
"For a glimpse of what awaits Britain, Europe and America, look at what is happening to Ireland.."
[url=http://www.forbes.com/2009/08/17/readers-digest-bankruptcy-business-medi... war era tool of the CIA, Reader's Digest, files for bankruptcy[/url]
[url=http://www.cbc.ca/money/story/2009/08/17/cma-health017.html]Economy linked to Canadians' health fears[/url]
[url=http://globalresearch.ca/index.php?context=va&aid=14819]The Secrets of China's Economy: The Government Owns the Banks rather than the Reverse[/url]
How can China's stimulus plan be working so well, when ours is barely working at all? The answer may be simple: China has not let its banking system run roughshod over its productive economy. Chinese banks work for the people rather than the reverse. So says Samah El-Shahat, a presenter for Al Jazeera English who has a doctorate in economics from the University of London. In an August 10 article titled "China Puts People Before Banks," she writes:"China is the one leading economy where the divide - the disconnect between its financial sector and the world normal Chinese people and their businesses inhabit - doesn't exist. Both worlds are booming again and this is due to the way the government handled its banks. China hasn't allowed its banking sector to become so powerful, so influential, and so big that it can call the shots or highjack the bailout. In simple terms, the government preferred to answer to its people and put their interests first before that of any vested interest or group. And that is why Chinese banks are lending to the people and their businesses in record numbers." ...
So now we know why hawks and neoconservatives in the US still refer to it as communist China.
State Capitalism, Fidel. Conceived in Russia many moons ago but impossible to work practically there without encouragement of entrepreneurial effort by the huddled masses ( potential business people).
The neocons would have to use "communist" to be able to bring Congress to stop China from buying up U.S. resource industries (while at the same time, themselves, demanding "free trade" . On weaker nations like Canada with large compador elements, they simply ignore the complaints. )
And of course, state reserves of capital, as in Norway's amassing of savings from the sale of North Sea oil, will one day insulate Norway's pensioners from general deprivation elsewhere.
Tar patch people are now about to construct a pipeline to the Pacific coast to carry the sludge to Asian markets so that there will be a continuing market should the U.S. put a plug in the southbound flow.
Only in Canada, you say. Pity we don't have a plan for the grandkids future. Just the promise of more CO2., eh?
State capitalism with a difference, George. By comparison, the US Federal Reserve was created at turn of the last century as a result of financial instability in US banking. But its nine or so supporting chartered banks are all privately owned a long time ago until the quasi-public setup they have now under the bailout regime. This is what state capitalism has produced with financial capitalism in the west. It's a like a great train wreck: horrible but too awesome to look away.
Wiki saysPeople's Bank of China governs over at least four "independent but state-owned" commercial banks, and the various departments are many, and ranging in description from state treasury to anti-money laundering, technology, and payments. I dont know, George, I think PBC more resembles the old Soviet GOSBank than the state capitalist setup in the states. The CPC was far more interventionist in banking and monetary policies than the US is today since the panic began. And they have money to lend to businesses and people all over China. Similar story happening in India except that India's currency is open to global market speculation unlike the Yuan still. China's state owned banks have amassed the largest public savings account in world history.
China's middle class, about the size of the US population as of a year or two ago, are actually paying cash on the barrelhead for homes and new cars over there because the personal savings rate is so high its ridiculous compared to here in North America.
I agree, the PBC is like the old Soviet GOSBank in some ways, Fidel. My "conceived in Russia" opening didn't make that clear. Marxist scholars in the West pegged the Soviets with the "state capitalism" label by the late 60's.
I think the difference with GOSBank is that they were paying everyone's wages in Russia as well as funding state socialism(or state capitalism as US Trotskyites prefer). The soft budget constraint was a newer phenomenon in the USSR from about Kruschev forward and used extensively by the Americans to fund a wide range of public services before Reagan not to mention ongoing socialism for rich people referred to sometimes as Keynesian-militarism. I think state socialism could work well if it wasnt for the Keynesian-militarism and cold war draining state resources away from the socialist end of things. Obama has hinted at overbloated defence budgets, but he knows he's not in control of those things as cosmetic leader. It's "a Washington" matter and senate matter. Wall Street has basically taken over federal powers of resource allocation. Theyve shed any vestiges of laissez-faire capitalism the US might have had in the 1930's because it didnt work then either, and since transformed themselves into the USSA. But unlike the former Stalinist USSR, Wall Street and the Pentagon capitalists, London etc are not content with state-capitalism "in one country"
Hunger and Poverty Facts (USA)
- in (pre-crisis) 2007, 37.5 million people were impoverished; they comprised:
- [b]12.5% of the population[/b] and 9.8% of families;
- 20.3 million or 10.9% of people aged 18 - 64;
- 13.3 million or 18% of children under age 18; and
- 3.7 million or 9.7% of seniors aged 65 or older who benefit from Social Security and Medicare.
In addition:
- 36.2 million Americans are [b]food insecure[/b], including 12.4 million children;
- they comprise [b]13 million or 11.1% of households[/b];
- 4.7 million households experience "very low food security" meaning hunger is a persistent problem;
- households with children have double the food insecurity as ones with none;
- single women-headed households are worst off with 30.2% of them insecure; and
- 53.9% of food-insecure households rely on one or more of the following federal programs - food stamps, the National School Lunch Program, and the Special Supplement Nutrition Program for Women, Infants and Children (WIC); in addition, Feeding America (in 2007) provided emergency food aid to about 25 million low-income people, 8% more than in 2001.
On August 6 [2009], the US Department of Agriculture reported [b]a record 34.4 million Americans (one in nine) receiving food stamps in May[/b] as unemployment keeps surging. It was the sixth consecutive monthly record, and every state showed an increase as economic conditions worsen.
On September 10 [2009], the Commerce Department will release [b]2008 census data expected to show around another 1.5 million people added to the poverty rolls over 2007[/b] figures - a total of nearly 39 million representing 12.7% of Americans. According to Rebecca Blank, Economic Affairs Undersecretary, final numbers aren't yet in and may be worse than expected because of how bad things are for growing numbers in the country. She believes if (U-3) unemployment hits 10% (up from 9.4% now), [b]poverty could reach 14.8% this year[/b] and rising because of jobs and homes lost, savings exhausted, and the sharpest ever decline in personal wealth between mid-2007 and December 2008.
Worst of all, conditions for most people are deteriorating as businesses, states, and local governments shed workers and cut budgets at the worst possible time. It promises harder times ahead and potentially millions more impoverished.
[url=http://dissidentvoice.org/2009/08/growing-poverty-and-despair-in-america... Poverty and Despair in America, by Stephen Lendman[/url]
Research professor and former Wall Street economist Michael Hudson said about [url=http://www.michael-hudson.com/interviews/030711_counterpunch.html]The Coming Financial Reality[/url] in 2003:
The problem with parasites is not merely that they siphon off the food and nourishment of their host, crippling its reproductive power, but that they take over the host's brain as well. The parasite tricks the host into thinking that it is feeding itself.Something like this is happening today as the financial sector is devouring the industrial sector. Finance capital pretends that its growth is that of industrial capital formation. That is why the financial bubble is called "wealth creation," as if it were what progressive economic reformers envisioned a century ago. They condemned rent and monopoly profit, but never dreamed that the financiers would end up devouring landlord and industrialist alike. Emperors of Finance have trumped Barons of Property and Captains of Industry.
But it is really the single-minded pursuit of short-term share-price performance that has made that possible. Fidel.
When capital searches out only the highest returns, when there is no loyalty to an industry employing people to manufacture a dependable product, you have to expect that the "Emperors of Finance" will get creative and suck them all in, because they get the billions in bonuses.
And the Lords of the Exchange are rising to the surface again, because in a market where greed rules (with fear), there is no way to escape from their grasp. At least, I can't think of a way of requiring the institutional investor of pension funds to accept half a loaf - in the name of full employment and national interests - all the time.
Dress Rehearsal for Debt Peonage
http://www.informationclearinghouse.info/article23386.htm
"failure to reform the economy will lead to debt peonage.."
...and maybe more..
Dress Rehearsal for Debt Peonage
http://www.informationclearinghouse.info/article23386.htm
"failure to reform the economy will lead to debt peonage.."
...and maybe more..
Jeezus Murphy! Don't listen to that one. It'll make your blood boil. The new business plan says that debt is wealth! Hudson says debt is not wealth, and banks and finance are rating assets and customers by their interest bearing capacity. It's vampirization and predatory lending. War is peace!! Debt is freedom!! Ignorance is strength!
Go To Pittsburgh, Young Man and Defy Your Empire
http://www.commondreams.org/view/2009/08/31-0
"Globalization and unfettered capitalism have been swept into the history books.."
Liquidity to Keep the Financial System from Collapsing in a Heap
I agree, the PBC is like the old Soviet GOSBank in some ways, Fidel. My "conceived in Russia" opening didn't make that clear. Marxist scholars in the West pegged the Soviets with the "state capitalism" label by the late 60's.
And then as the end of cold war drew nearer in the early 1980s, Harvard economists and "economic hitmen" travelled to the former Yugoslavia and Russia. They brought stacks and stacks of paper as evidence that the Soviet economy could be made more efficient if they were to integrate their economies with the wester world, which traded with about two-thirds of what represented the "free world" then. These economists performed dog and pony shows with oodles of slides presentations and impressed the hell out of aspiring state capitalists and nomenklatura in the former USSR. Apparently Gorbachev was convinced that what they were getting was Swedish style market socialism. They convinced the Soviets that sending oil, raw materials, and humanitarian aid to developing countries like Cuba, Vietnam, Cambodia etc was unsustainable and just not good for capitalism. In fact, some number of COMECON block countries were considered by the west to be sponging off Russia and that the trade imbalances would eventually end in disaster for everyone involved.
And in case all that didnt appeal to the Soviets, there were promises made to end the vicious trade sanctions and embargos of citrus fruit and other goods monopolized by a handful few British and American multinationals and trading companies. Ronald Reagan gave assurances that if German reunification took place, NATO would stop efforts to expand into Eastern Europe. But I think now that instead of wanting to trade freely with Russia, western world oligarchs and supranationals want to dominate Russia and former sattellite nations, much the same way in which the USSA dominates trade and relations with Canada today. The Reaganauts were taken totally by surprise by the end of the cold war and dismantling of the Berlin Wall. Instead of imagining the opportunities for world peace and prosperity, US hawks got right down to business and began new central planning for creating an "arc of crisis" in the Middle East and Central Asia and colder war manouvering toward NATO expansion.
The heads of the 20 banks that got the biggest federal bailouts - and laid off over 160,000 workers - made almost 40 percent more than other CEOs last year, with the top five executives at those banks earning about $32 million each and seeing stock options soar $90 million, a new study shows. The annual Institute for Policy Studies "Executive Excess" report also shows that average CEO pay was 430 times larger than for typical workers.
"America's executive pay bubble remains un-popped," says Sarah Anderson, lead author on the study. "And these outrageous rewards give executives an incentive to behave outrageously, putting the rest of us at risk."
- [url=http://www.commondreams.org/further/2009/09/02]Source[/url]
[url=http://www.vancouversun.com/business/Canada+weak+recovery+says+OECD/1958... Anemic Canadian economy lags G7[/url] Will shrink 2% this quarter and expand only 0.4% in the fourth
[url=http://globalresearch.ca/index.php?context=va&aid=15537]Surge in Unemployment in the US: No Economic Recovery in Sight[/url] Shamus Cooke
After the recent unemployment numbers were announced, smug politicians promising economic recovery stuttered a bit. This wasn’t supposed to happen. Mainstream economists were predicting a smooth upswing in employment, but in September 263,000 more jobs were lost, 62,000 more than August. Obama reacted predictably to the surprise. He first pointed out that “employment is the last thing to recover from a recession,” and concluded that “…we are going to need to grind out this recovery, step by step.” Brilliant.
Not one word on measures to help out the staggering number of unemployed workers, 1.4 million of which will have their benefits dropped by the end of the year. Behind them are millions more workers who’ve been unemployed for over six months — 5.4 million and counting.
All Obama is offering is “hope” that the economy will get better, an illusion shared by most of the mainstream media. Sometimes, however, the truth sneaks into Big Media. This from the New York Times“…the underlying weakness of the economy will probably reassert itself, say experts. After years of borrowing against homes and cashing in stock to spend in excess of their incomes, many Americans are tapped out. Austerity and saving have replaced spending and investment in many households, constraining the economy.” (October 2, 2009)...
From that country whose most unsustainable economy in the world our stooges so unwisely tied our economic wagon of misfortune to with FTA and NAFTA.
The Demise of the Dollar
http://www.independent.co.uk/news/business/news/the-demise-of-the-dollar...
"In a graphic illustration of the new world order, Arab states have launched secret moves with China, Russia and France to stop using the US currency for oil trading.."
Two socialist books/pamphlets available online for free .pdf download:
[url=http://www.readingfromtheleft.com/PDF/SP/FinancialMeltdown.pdf]Financial Meltdown: Canada, the Economic Crisis and Political Struggle[/url], with 17 articles by Leo Panitch, David McNally, Greg Albo, Adam Hanieh and others (Socialist Project)
[url=http://www.readingfromtheleft.com/PDF/Meltdown.pdf]Meltdown! A Socialist View of the Capitalist Crisis[/url] by Tony Iltis, Lee Sustar, John Bellamy Foster, Phil Hearse, Adam Hanieh, Dave Holmes (Resistance Books, Australia)
[url=http://globalresearch.ca/index.php?context=va&aid=15597]Collapse of the Greenback? Will the Dollar get an "Arab Oil Shock"?[/url]
According to a leaked report from Arab Gulf oil producers, there have been a series of secret meetings in recent months between the major Arab oil producers, including Saudi Arabia, and reportedly also Russia, together with the leading oil consumer countries including two of the three largest oil import countries-China and Japan.Their project is to quietly create the basis to end a 65-year long "iron rule" of selling oil only in US dollars. As I document in my book, Mit der Ölwaffe zur Weltmacht (Kopp Verlag), following the 400% oil price shock of 1973, which was deliberately blamed by US media on "greedy Arab Shiekhs," the US Treasury made a secret trip to Riyadh to tell the Saudis in blunt terms that if they wanted US military defense against potential Israeli attack, that OPEC must privately agree never to sell oil in currencies other than the US dollar. That "petrodollar" system allowed the US to run staggering trade deficits and remain the world reserve currency, the heart of its ability to dominate and control world financial markets until the crisis of the sub-prime real estate securitization in August 2007. . .
What is not clear is what the potential response of Germany and France, the two pivot powers within the EU will be.
[url=http://www.bloomberg.com/apps/news?pid=20601087&sid=a8v8Ep92gecc]China Wealth Fund to Buy Shares in Nation's Three Largest Banks[/url]
Oct. 12 (Bloomberg) -- China's $300 billion sovereign wealth fund said it will continue increasing its stakes in the nation's three biggest lenders, seeking to bolster investor confidence after Chinese shares fell last quarter.Central Huijin Investment Co., a unit of China Investment Corp., "recently" bought Shanghai-traded shares in Industrial & Commercial Bank of China Ltd., China Construction Bank Corp. and Bank of China Ltd., according to statements issued late yesterday. . .
Shares in the three lenders, who rank among the world's six largest banks by market value, have underperformed the Shanghai Composite and their Hong Kong-traded stock this year. ICBC rose 2.6 percent in Shanghai as of 9:41 a.m. and China Construction Bank gained 2.9 percent. Bank of China added 2 percent.
Beijing-based Huijin bought 30.07 million yuan-denominated shares of ICBC, taking its ownership to 35.42 percent from 35.41 percent, ICBC said in a statement. Huijin also purchased 5.13 million shares of Bank of China and 16.1 million shares of China Construction Bank, boosting its stakes in the two banks to 67.528 percent and 57.09 percent respectively.
The state investment unit will continue to increase its holdings in the banks by buying shares in the open market over the next 12 months, according to the statements. Huijin completed the first round of purchase on Sept. 28.
Can anyone imagine our laizy-faire stoogeocrats investing in a national construction bank? Here we give billions of dollars away on the hush-hush and QT to private banks and put it on the taxpayers' tab. And then they profess that our big six banks are doing well. No kidding!
The Crime of Our Time: Was the Economic Collapse "Indeed Criminal"
http://www.sjlendman.blogspot.com
"As a form of economic terrorism, indeed so says Schecter and many others...a financial coup d'etat."
The sister magazine to Monthly Review in India, called Aspects of India's Economy, has a very good piece about the global capitalist financial and general crisis. At the end of the article there is more detail about India itself, which is interesting anyway, but what I would draw the attention of babblers to is the excellent summary, not only of the current crisis but, of the history of 20th and 21st century crises of capitalism over the whole globe, Actually it's outstanding.
The New Great Depression and India
It is the role of sincere students of political economy to explain to the people the real causes of the current crisis, and the need to struggle for a political economy that can direct the country's social surplus to meet the real social needs of the present and future.
The Dollar Will Not Crash
http://www.counterpunch.org/whitney10192009.html
"the dollar is not going to crash. There may be grumblings in foreign capitals and "secret meetings" between finance ministers but, for now, the dollar appears to be safe.."
Fed & Treasury Pitch Pay Rules, But Will They Work?
The shocker is, Business Week of all publications (!) is endorsing even stricter pay rules for executives at banks and the bailed-out corporations than those currently proposed.
Bizarro socialist world, here I come. :D
They've resorted to socialism numerous times before in the US and declared it free market victory years later. They're doing it again to a large extent.
[url=http://network.nationalpost.com/np/blogs/fullcomment/archive/2009/10/21/... Gordon takes on economic illiteracy rampant among Canada's private sector economists[/url] ... in the National Post yet!
This is the same economist that has no clue how much political suicide it is to talk about increasing the GST or expanding the tax base?
And also has no clue or purposely chooses to ignore the fact that Gordon Campbell and his sidekicks have lied about the introduction of the HST, downplaying it prior to the election?
His ideas may be just fine on paper, but like a lot of economists they seem to not realize how real-world implementation is a harder road to hoe than they think.
Stephen encounters that sort of political realignment when he posts here occasionally. :D
I always got the impression Stephen is impressed with the amount of interest and awareness of the issues here on babble and certainly the level of knowledge among babblers. I thought Doc, Stephen and others had some interesting conversations back when I first babbled.
[url=http://www.policyalternatives.ca/news/2009/10/article2334/?pa=BB736455]E... still not recovering: CCPA Study by Jim Stanford and David Macdonald[/url]
October 29, 2009
Canada's economy is still mired in recession and a long way from recovery, despite months of "green shoot" speculation, says a report released today by the Canadian Centre for Policy Alternatives (CCPA).Canada's Long Road to Economic Recovery, by Jim Stanford and David Macdonald, examines Canada's economic indicators and concludes more public investment will be key to Canada's recovery.
"Canada's private sector has not yet bounced back from last year's economic shock and there are no signs that it will rebound quickly," says Stanford, CCPA research associate and economist with the Canadian Auto Workers. "Public investment has been essential to stabilizing Canada's economy-it is the only engine of economic growth right now."
The report looks at Ottawa's stimulus initiatives to date and finds:
- the Harper government handed Canada's financial sector one of the biggest support packages in history, freeing up banks for continued healthy profits while private sector borrowing remains in decline;
- the federal government's 2009-10 stimulus package of $18 billion pales in comparison to a potential $200 billion in financial sector bailout;
- net federal infrastructure stimulus spending during the period from October 2008 to August 2009 declined by $1.7 billion compared to the same period the previous year;
- federal stimulus spending on infrastructure projects most likely to create new jobs from April to August 2009 went up by only $1.9 billion compared to a year ago-only 22% of such promised budget increases had been spent by August, meaning most of the infrastructure money missed the 2009 summer building season;
Canadian program spending expansion was outpaced 7 to 1 by the Americans in the first half of 2009.
"The federal government was quick to support Canada's financial sector but its job creating infrastructure stimulus program hasn't been up to the task," says David Macdonald, coordinator of the CCPA's Alternative Federal Budget.
"the federal government's 2009-10 stimulus package of $18 billion pales in comparison to a potential $200 billion in financial sector bailout;"
the Guardian.co.uk article linked today from rabble on measures RBS and Lloyd's were 'forced' to undergo- like divying off crappy sectors- are actually of benefit to these private corps. In fact so are the limits on CEO bonuses. Why? Because those bonuses have been made the focus of populist argument (understandable) without simultaneously demanding rejection of private or public-private financial expansion clauses in 'trade' deals and G20 financial reform proposals.
They'll take a shave here, as long as they still get to run the show for the foreseeable future.
The biggest bonus is still theirs.
http://www.forbes.com/2009/11/06/bonuses-lloyd-blankfein-personal-financ...
This is Forbes, folks. FORBES.
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"Finance is on trial," is the way John Micklethwaite, editor of The Economist, put it at the Buttonwood Conference two weeks ago in New York. "Finance desperately needs opening up to soothe frustrations of the public. Markets are not separate from society. Finance is in the court of public opinion."
And the leaders of finance are doing a piss-poor job of explaining themselves, wrapped for decades in self-satisfied entitlement permitted by the unenlightened laissez-faire policies of governments. Read Too Big To Fail, the mediocre narrative of mediocre financial types in their playpens by Andrew Ross Sorkin of the New York Times. You will be revolted by their petty mindedness, their lack of thoughtfulness, their inability to deal with crisis. Pathetic and yet highly paid for being pathetic. How were they able to get into positions of such influence and power? They should have to do public service at no pay.
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If they had written something like that in the 1990s every jackass of a Republican in Congress would have bounced up and called Forbes a bunch of out-and-out goddamn pinko Commies and that idiot Limbaugh would have done his stupid little "squeaky Liberal" mimic thing while reading the article out loud and having every mouth-breathing moron calling into his show praising him to the skies after every paragraph.
My, how times have changed. The Dems are wasting the momentum they're carrying when Forbes of all magazines is writing things FDR would have said.
http://www.financialpost.com/news-sectors/story.html?id=2203756
The United States, even now, does nor want controls over capital flows. And shame on the Harpoids for following in their footsteps!
Never mind that China, the US's biggest competitor in the world political scene, regularly uses such controls to insulate its economy from the winds of globslization, and has in fact repeatedly slowed the pace of de-control in response to the late 1990s Asian financial crisis and the recent crises of 2007-2009.
Europe, as well, is also moving towards reinstatement of controls over capital flows and in point of fact in the past, Western Europe did not fully lift controls until the 1960s, well after war had devastated that continent.
I highly suspect that currency "traders" (speculators) and large banks are behind this move because they do not want to lose a lucrative source of money at a time when the rest of their asset books don't look so good.
I find it reprehensible that the US Government continues to be captured by the interests of a powerful few who continue to selfishly try and thwart the better good of multitudes more who do not have their financial or political clout.
Today Chris Dodd, US Senate Banking Cttee chair, came out with a financial 'stabilization' act that provides more detail regarding 'oversight' of banking and insurance by a new federal agency.
here's the text of the bill:
http://banking.senate.gov/public/_files/AYO09D44_xml.pdf
It calls for the state Federal Reserve members who used to be chosen by private bankers to be appointed instead by the Federal Reserve Board of Governors. That step could be an improvement.
But the text is rife with use of the term 'as necessary'. In the context of trade deals, that phrase means the new public agency will have its hands tied.
The new agency can only obtain reports from specific financial companies if it's necessary to prevent systemic risk to the financial system.
The new agency is to rely primarily on the state Federal Reserves and other agencies, using their existing reports, having legal ability to pursue additional reporting only from certain 'specified' financial companies (ones that the other agencies target as problem cases) when it's necessary to prevent risk.
That's very different from comprehensive collation of data on financial products and transactions- the kind of data one would expect of a public financial system.
And any steps to get actual financial data even from targetted risky companies will have to face the legal necessity tests. Regulators can be challenged from step one.
Further, the section on Harmonization calls for this approach to be adopted internationally, and requires information sharing. That information sharing does not extend to the public though- even Congress can only receive general news of risk.
Why, in the face of the utter failure of financiers to act sensibly, do regulators continue to give bankers and their well-funded lawyers the ultimate policing powers?
Regulators need the freedom to collect all financial data, not just the pieces which bankers allow.
