Since my mom died (31 July, 2011) and I got out of the second most recent mental hospital (apx 12 Aug, 2011), I have engaged myself not only with my own personal spring cleaning 2000 (Sisyphean task, on going, averaging about 2 hours per day since 17, Sept, 2010) but with going through every nook and cranny in the house and storage garage to identify just what it is that mom has saved over the last 79 years and 363 days of her life.
It appears that all she tossed ever (and I may be much in error on this; actually I REALLY hope so) was my complete TOPPS 1960 major league baseball collection. But, all the cards, post cards, letters, photos, bills, tax returns, etc, etc, they are all here, in glorious color. And one day I will have archived them all!
From about 4 treasure finds ago, I found the sheet music (for flute) that her older sister Cathy owned. WELL, I sure as hell had to call my cousin Bruce (the eldest of the Richardson kids) to let him know, and my timing could hardly have been better. Bruce and Cotty had not always, how shall I say this, gotten along so well, BUT, he was with her in those last dying days, and one of them, when she was pretty lucid by comparison she said, "Bruce, I want you to have my flute."
"But mom, I don't play the flute!"
"I know, but you're the only one I know for sure who won't sell it."
And he was excited as hell to learn of the sheet music treasure find!
Finally got around to sending it to him, probably, two weeks ago, and he just got it (phriggin US postal service) a couple of days ago. He was so thoughtful, he even reimbursed us for the postage (11.61, excedpt, for $47.00, could have had it out there express mailed the next day; what an insult THAT would have been to the memories of our mothers, daughters of the Great Depression who damn well knew and learnt the value of a dollar!).
SUBJECT: Got your generous check
Cain't let that stuff go by without acknowledging it, and thus, you get an intimate view of my e-mail to Bruce, complete with the dialect, and perhaps even the vernacular. I AM one crusty mother fucker!
And goddamned if Ralph didn't chisel me out of $1.61 - rofl - he was gonna give me the whole nut, for expenses (can't drink beer no mo' - blood sugahs too damned high - gonna be rot gut vodka from here on out, or in, I guess) but he seed dat 20 dollah and he done changed his tune to the double saw buck split, but, DAYAM, it bee feelin' good to have some scratch in my pocket.
I'm absolutely delighted that you were able to identify the sheet music Cotty got out your ways. My guess is that she got it after she and Con got married and they made those regular and blessed sojourns out this-a-ways and might have been music they were playing in one of those latter day photos of the sisters doin' they music THAYANG!
Watched the Centerville Vid again on Gay's birhtday with my beloved bridge partner and his long suffering wife, Saint Margaret. DAYAM, mon, you be one hell of a harpist - you be blowin' dah bluuze wid me now, y'all hear, when I gets my steenky ass outchore weigh to be playing my fund raisgin' thayangs.
Noticed things about Annie I hadn't noticed the first few times I watched it - clearly, she's having the time of her life (neices, nephews and all, who the fuck wouldn't) and her voice is as strong on key and on pitch as ever, but, shee-yit, she look so dayam tie-red, so wan, so small, so shriveled, hell, she was dying then and we didn't even notice.
I still blame the congenitive heart failulre, and along with that, blame her or her doctors or the whole damn lot of them, for not following up on the congenitive heart failure MUCH more regularly -- it was the pneumonia in both longs that ensured that even had they been able to re-ignite her, she was gonna be a permanent veggie. Live and learn we must.
Thanks for being so thoughtful about the postage!
ENJOY that music, and MAN, when I be gets my ass out dere, or you be gets yo skinny white AYASS outchheah, you best be brangin dat flaut thayang, and you, boy, best be able to plays me sumtin! Else wise I done gonna kicks yo' skinny white ass, no matter how fur up it I might lose my foot!
With LOVE to You, and ALL YOU LOVE,
MarKUSS (formerly room service for ... da boys)
NOVEMBER 15, 2011
52
A Short History of Elite Responses To Political-Economic Crisis
How The Oligarchy Gets Politicized
by ALAN NASSER
The performance of the US economy from the mid-1970s to the present was no match for its relatively robust performance during what economists call the Golden Age – 1949 to 1973. This was in fact the longest period of sustained growth in US history, when most (white) working people had achieved a degree of material security unknown earlier and unattainable since. But from the late 1960s and through the 1970s economic malaise was increasingly in evidence, signaling worse to come: high rates of both inflation and unemployment -stagflation- was not supposed to be possible in a Keynesian (1) world, but there they were, and seemingly intractable. At the same time workers’ productivity declined dramatically. Profit rates fell steadily for more than ten years as revived Japanese and European economic competitors increasingly ate into US manufacturing’s share of both world trade and the domestic market itself.
Corporate and political elites responded with the cold bath treatment. “The standard of living of the average American,” pronounced Fed chairman Paul Volcker on Oct. 17, 1979, “has to decline. I don’t think you can escape that.” Interest rates went through the roof. Austerity was the order of the day, and it still is.
In 1983 an analysis of US decline and the ensuing rise of Thatcher-Reaganism appeared, in the book Beyond the Waste Land, by three Harvard-based radical economists - Sam Bowles, David M. Gordon and Thomas Weisskopf. The book received favorable reviews in many mainstream media, including The New York Times and The New York Review of Books. Reviewers included the distinguished US economists John Kenneth Galbraith, James Tobin and Kenneth Arrow.
The authors argued that a social-political factor of great importance figured crucially in the decline of US hegemony: workers had become more secure and therefore more emboldened by Keynesian New-Deal benefits like Social Security and unemployment insurance, and the labor-friendly social programs of Lyndon Johnson’s Great Society. Labor’s uppityness was especially striking in the 1960s and early 1970s. There was a notable increase in labor actions, from strikes to industrial sabotage. With fewer workers worried about where the next mouthful would come from, we saw an increase in goofing off on the job, tardiness, job-switching, pressure for improved workplace safety measures and demands for higher wages and benefits. The result was a decline in productivity (output per unit of labor input) and a wage-push profit squeeze.
Most importantly, the legacy of the New Deal and the Great Society had resulted in a shift in the distribution of national income from capital to labor.
Bowles, Gordon and Weisskopf argued that with effective unions and unprecedented security, labor had achieved a degree of power over capital hitherto unknown. This analysis has been developed more recently by the economists Jonathan Goldstein and David Kotz, who show that every Golden-Age recession was generated by a wage-push profit squeeze in the preceding expansion. According to Bowles, Gordon and Weisskopf, capital did not take this sitting down. Corporate America initiated a counteroffensive which the authors called the Great Repression. Capital’s counterattack, we may say, persists to this day.
Liberal Thinking About the Politics of the Elite
Several of the most prominent liberal reviewers of Beyond the Waste Land were scandalized by the authors’ claim that capital deliberately organized active political resistance to working-class advances. In the New York Times (July 31, 1983) Peter Passell, who at the time wrote about economics for the Times’s editorial page, complained that the book exhibits an “emphasis on conspiracy.” John Kenneth Galbraith was far more insightful and dismissive of mainstream orthodoxy than liberals of a Paul Krugman or Robert Reich kidney. Yet he too could not imagine that the vested interests deliberately muster forces antithetical to working-class interests. In his otherwise generous praise for the book in The New York Review of Books (June 2, 1983) Galbraith registered a “serious complaint about the authors’ position on political power…. They see the present sorry behavior of the economy as the result of a thoughtful and deliberate exercise of corporate power.” Galbraith repudiated the authors’ “conviction that the present disaster is designed – that it reflects in a deliberate way the interest of the corporations. This I do not believe. I would attribute far more to adherence by the corporate world to outdated and irrelevant ideology, and to political leaders, not excluding the president, who do not know what damage they are accomplishing.”
It is as if acknowledging elites’ political activism gives credence to class analysis, which is thought to be too Marxian for our own good. Talk of corporate dominance of the State opens the door to unacceptably subversive reconceptualizations of matters we have been trained to understand in safer, less seditious terms. Seeing a recession as a strike of capital, for example, forces us to make the appropriate readjustments in a range of related economic and political understandings. Indeed, as Galbraith recognized, Beyond the Waste Land requires us to think and to act very differently regarding what political power is all about. It is less unsettling to imagine that “irrelevant ideology” and political ignorance lie at the heart of the current economic debacle, than it is to see the depression as the outcome of a deliberate assault on working people by the oligarchs.
These liberal objections are far less believable now than they were 28 years ago. Elites are not philosophers seeking to be guided by the most intellectually cogent theories. Political power is not about upholding this or that ideology; it is about legislating in this or that group’s interest. Political power is exercised most successfully by those whose interests are most consistently served by the exercise of State power.Cui bono? remains the best test of who matters most to the State managers. The latter govern; the former rule.
By this test only the blind fail to see that Wall Street is now running the show. The blind abound among liberal intellectuals. In his New York Times column on Nov. 23, 2009, Paul Krugman confesses that “It took me a while to puzzle this out. But the concerns Mr. Obama expressed become comprehensible if you suppose that he’s getting his views, directly or indirectly, from Wall Street.” You don’t say.
Krugman’s epiphany was available before Obama was elected. In September 2008, finance capital stepped forward, openly and unabashedly pushed aside its political representatives, and proceeded to dictate policy to the Congress and the White House. Hank Paulson demanded $700 billion for the banksters, with no strings attached: there would be no restrictions on how the handout was spent, no hearings, no Congressional debate, no expert testimony and Paulson was not to be held accountable. Obama suspended his campaign for a day to make phone calls urging Congressional Democrats to obey Paulson’s orders. His top economic advisors, his Treasury Secretary, his Fed chief, turned out to be mostly Wall-Street-linked deregulators. It was more than a year before it dawned on Krugman that Obama might be Charley McCarthy to Wall Street’s Edgar Bergen.
Elite Responses To Crisis
The political activism of the elite is striking in times of crisis, when the latter takes the form either of severe economic contraction or of working-class militancy, or both. Let’s look at the specifics.
The ruling class has attempted directly to address crisis situations in each of the three major economic downturn periods since 1823. I treat nineteenth century American capitalism (1823-1899) as a single depression period, since over the course of sixty years it featured three steep depressions, 1837-1843, 1873-1878 and 1893-1897. Indeed, the entire period 1823-1898, excluding the Civil War, saw the nation in recession or depression more often than not. The Great Depression of the ‘30s was of course the second such period, and the years from late 2007 to the present constitute the third.
The corporate oligarchy has also responded to the New Deal/Great Society Golden Age as another crisis period, this time of a special kind. In that case the crisis was not perceived by the elite as purely economic, but as political, involving a transfer of both income and power from the wealthiest to the rest. Ruling-class mobilization ensued. The plutocrats openly “put politics in command.” Neoliberalism began to take shape.
After a brief review of the plutocrats’ responses to the depression periods and the Golden Age, I will look more closely at the stretch of time from the mid-1970s to the end of the twentieth century as a prolonged insurgency of the vested interests against regulated and relatively-worker-friendly American capitalism, and as a buildup to the current mess.
We begin with the corporate class’s first modern historical attempt to coordinate its power as a class. This was an effort initially confined to the economic sphere. Once the elite had established a private regime of market collaboration, it became clear that subsequent threats to its interests would require political mobilization. What we face now is a ruling class politically organized as never before, and with a firm grip on State power.
The Nineteenth Century: Depression Paves The Road To Corporate Organization
Railways and steel epitomized the chronic economic instability of nineteenth-century US capitalism. In each case enterprises repeatedly competed their profits away into bankruptcy or receivership. Finance capital responded by pressuring its industrial counterpart to consolidate in order to avert the perpetuation of what was very close to three quarters of a century of sustained slump.
Keynes famously described a clear instance of irrational competition: “Two masses for the dead, two pyramids are better than one; not so two railroads from London to York.” In fact, in Britain and in the US the railroad magnates had repeatedly built two or more railways from A to B, with the predictable consequences: bankruptcies proliferated. By the end of the nineteenth century the giant railway networks were the largest business enterprises in the world, yet by 1900 half of them had gone into receivership.
The financial magnate J.P. Morgan was attuned to the contribution of fratricidal competition to recurring economic downturns and, not incidentally, to the attending threat to bank profits. He persuaded the biggest railway barons to organize. He had them form “communities of interest” to reduce destructive competition by fixing rates and/or allocating traffic between competing roads. Most of these efforts failed; invariably at least one of the companies would try to take advantage of the others’ compliance by breaking its promise.
Morgan’s response was, in retrospect, epoch-making. He implored his real-economy counterparts to consolidate as a matter of policy. Consolidation, he urged, was the most effective antidote to cutthroat-competition-induced depression and falling bank profits. Concentration was in capital’s best interests. Practicing what he preached, Morgan took control of one sixth of the nation’s largest railroads.
The steel industry exhibited a similar dynamic. The superinnovator Andrew Carnegie introduced productivity-enhancing technological improvements with uncommon frequency. His high rate of capital replacement lowered his unit costs, raised his competitors’ costs and devalorized their obsolete capital, enabling him to price-compete many of them to bankruptcy.
This left bankers like J.P. Morgan with big debtors unable to service their loans. Cutthroat competition was again rightly perceived by Morgan as contrary to the interests of capital.
Carnegie was a special nuisance to Morgan, who repeatedly implored him to slow down his innovations. When Carnegie resisted, Morgan simply bought him out and consolidated the Carnegie Steel Company with some of its weaker competitors. In 1901 Morgan’s steel behemoth became US Steel. This gave precedent and impetus to the oligopolization of major industries that was to become a hallmark of twentieth century capitalism. Cutthroat price competition was replaced with “corespective” competition, effected mainly through advertising, new products, improved technology, and organizational change.
Morgan had become the nation’s first prominent active critic of cutthroat competition. His effort consciously to limit competition was the first historical attempt of a major ruling-class activist deliberately to intervene in the dynamics of the economy in response to viral bankruptcies and depression.
Morgan’s lessons are implicitly subversive. He instructed his industrial brothers that their individual interests are best realized by action in concert. Morgan understood that the most effective agent of capitalist success is not the individual but the class. The same of course applies to anti-capitalist success. This Morgan did not discuss.
Organized capitalism was strikingly different from its nineteenth-century ancestor, with one exception. In both periods economic liberalism persisted; government regulation was almost entirely absent. The absence of regulation was a major factor in precipitating both the Great Depression and the current severe downturn.
The Great Depression: Coup d’Etat as Response to the New Deal’s Politicization of the State
J.P. Morgan’s response to crisis was to recommend to his class brothers a new form of industrial organization. The resulting reconfiguration of the private economy was accomplished with virtually no overt participation by the State, in accord with the prevailing laissez faire ideology. The notion that the State could respond to economic malfunction by active intervention had not yet entered official thinking.
During the crisis of the 1930s the dominant orthodoxy was severely challenged. Morgan’s precedent for dealing with economic collapse generated by unbridled competition was that the Big Boys could put their own house in order by teaming up. By contrast, 1930s capital was without private, class-grown strategies adequate to the task of getting the Great Depression under control.
The seeds of the Depression had been planted in the 1920s, when the economic scene was strikingly similar to what precipitated the current downturn. Output, investment, productivity and profits rose much faster than wages. Unions were weak and inequality soared -1928 was the then-record year for income inequality- and working people relied heavily on debt to finance their purchase of the avalanche of newly available consumer durables. During the latter half of the decade economic growth was driven largely by credit-fueled consumption expenditures.
The unprecedented inequality that emerged from this setup widened the gap between productive capacity and effective demand and caused, beginning in 1926, a marked slowdown in the purchases of the very consumer durables -radios, refrigeratots, toasters, automobiles- on whose growth the health of the productive economy had become dependent. The growth rate of manufacturing declined dramatically, and investment-seeking capital fled to speculative financial markets, ultimately inducing the crash of 1929. Sound familiar?
Reflecting on these realities, the Keynesians surrounding Roosevelt proposed the notion that the economy had reached “maturity” during the end-stage industrialization of the 1920s. All previous expansions out of downturns had been propelled by investment spending on means of production and workplaces; the nation was still industrializing. This time, and for the first time, it was different. Excess capacity abounded at the end of the decade, but not, as in the nineteenth century, as a result of serial bankruptcies. The triple blights of inequality, over-investment and underconsumption were the culprits. With the basic industrial infrastructure now in place, and productive facilities glaringly superfluous, if the economy was to recover there had to be a resurrection of consumption demand. But the condition of the private economy ruled this out. This is what Keynes understood. His was a prescription for the economic restoration of a mature industrialized economy in the depths of a severe, sustained and self-perpetuating downturn.
The historical stage was now set for the birth of the Keynesian insight that only an agent outside the sphere of the market, and unmotivated by the quest for private profit, can restore a mature capitalist economy in deep depression. Many of FDR’s early “Brain Trust” were solid Keynesians, and the combination of their tutelage with mounting labor militancy convinced the president to initiate a major break with free-market precedent. He initiated a grand plan of public investment and government-provided jobs which not only brought about a reversal of the downward plunge of 1929-1933, but also generated the longest US cyclical expansion recorded up to that time, 1934-1938.
To the business class this seemed an unconscionably revolutionary turn. FDR’s fierce denunciation of the banksters even as he politicized the State in the name of working-class interests was viewed as an unparalleled and horrific development, a popular assault by the State on the power of Big Wealth. The logical response of the business class was not to attempt to reconfigure the private sector as Morgan had done, but to seek to capture the State, which it perceived as a greater threat to its dominance than the Depression itself. Morgan had attended to matters economic. But the emergence of a mature oligopolized form of economic organization required from the superordinates a distinctly political response.
The ruling elite proceeded in 1933 to organize a coup intended to topple the Roosevelt administration and replace it with a government modelled on the policies of Adolf Hitler and Benito Mussolini. (A 1934 Congressional committee determined that Prescott Bush, granddad of Dubya, was in communication with Hitler.) The plotters included some of the foremost members of the business class, many of them household names at the time. Prominent insurgents included Rockefeller, Mellon, Pew, Morgan and Dupont, as well as enterprises like Remington, Anaconda, Bethlehem and Goodyear, and the owners of Bird’s Eye, Maxwell House and Heinz. About twenty four major businessmen and Wall Street financiers planned to assemble a private army of half a million men, composed largely of unemployed veterans. These troops would constitute the armed force behind the coup and defeat any resistance the in-house revolution might generate.
The revolutionaries chose Medal of Honor recipient and Marine Major General Smedley Butler to organize its armed forces. Butler was appalled by the plot and spilled the beans to journalists and to Congress. FDR nipped the thing in the bud.
The attempted coup was a landmark event in US history, baring the soul of America’s standing wealth. (We find no mention of this event in US history textbooks. History unfit to print.) We have no reason to think that these fascist instincts have been expunged from the class character of our rulers. No less important, the scandal alerts us to the elite’s Leninism, its identification of the State as the political prize of prizes, the seat of class power.
Ironically, it was Keynes who put the deliberate capture of the State on postWar capital’s agenda. 1930s Keynesianism saw the State legislating in the interests of working people, and successfully competing in the labor market with private companies. This was an explicitly politicized State functioning, in the eyes of the elite, as the executive committee of the working class.
Big capital learned a lesson of abiding importance: determining State power must be their deliberate and overriding political agenda. Siezing State power by force of arms, they had learned, is easier planned than accomplished. The final years of the Golden Age saw the captains of wealth devising a longer-term political strategy to roll back the New Deal and Great Society, and to set in place arrangements that would preclude their recurrence. This time it was to be a New Deal for capital, a State unabashedly politicized for the class that counts. These were the early formative years of neoliberalism.
The Golden Age Not So Golden For Capital
The Golden Age is distinguished by its remarkable growth rate and the unprecedented material security enjoyed by a good number of workers. But growth rates tell us nothing about how the fruits of growth are distributed. The present moment illustrates this nicely. The economy’s rate of growth has been very slow, while corporate profits and the income of the top .01% have reached record highs. Ring this up to a deliberate, policy-driven transfer of income and wealth from the rest to the richest. Distribution counts a lot for the wealthy. Their political power is a function of their wealth. If wealth and/or income is redistributed to another class, so is power. That goes down badly with rulers.
The New Deal/Great Society period saw increasing redistribution from capital to labor. The share of national income appropriated by the top 1% of households steadily declined during those years. In 1928, the most unequal year to date since 1900, the share of the top 1% stood at more than 23%; by the late 1930s it was down to 16%. It declined to 11-15% in the 1940s, to 9-11% in the 1950s and 1960s, and finally fell to its nadir of 8-9% in the 1970s.
This was the first 50-year redistribution of income from the very richest to the rest in American history. The oligarchs were to take steps to ensure that this would never happen again.
Elites saw redistribution as inherent in any State policy orientation distributing toward working people benefits which the market by itself would not produce. If you give them a little, little by little they’ll want it all. To the boys used to being in charge, Lyndon Johnson seemed to be responding to popular pressure to out-New-Deal the New Deal. The latter had given us Social Security; Johnson expanded the program to include disability payments and more. Johnson and a Democratic Congress passed new or strengthened laws, mainly around consumer and environmental issues, that cut into business profits by forcing corporations to absorb some of the costs they had previously externalized onto the rest of us.
In less than four years Congress enacted the Truth In Lending Act, the Fair Packaging and Labeling Act, the National Traffic and Motor Vehicle Safety Act, the National Gas Pipeline Safety Act, the Federal Hazardous Substances Act, the Flammable Fabrics Act, the federal Meat Inspection Act and the Child Protection Act. Whew.
Business-government relations had never before seen such an avalanche of legislation limiting the freedom of capital in the interests of working people.
Between 1964 and 1968 Congress passed 226 of 252 worker-friendly bills into law. Federal funds transferred to the poor increased from $9.9 billion in 1960 to $30 billion in 1968. One million workers received job training from these bills and 2 million children were enrolled in pre-school Head Start programs by 1968.
What made all this especially unnerving in the eyes of Big Wealth was that even the Republicans seemed to have swallowed the redistributionist line. Richard Nixon announced in 1971 “I am now a Keynesian in economics” (not “We are all Keynesians now”, as the remark is usually misquoted). Nixon was in fact a bigger domestic non-military spender than Johnson. During his first term in office Congress enacted a major tax reform bill, the Environmental Protection Agency along with four major environmental laws, the Occupational Safety and Health Administration and the Consumer Products Safety Commission.
The combination of regulation and redistribution left the working class as materially secure as it had ever been, and more inclined to feel its oats. When the economy began to approach full employment, toward the peak of a Golden-Age expansion, workers’ slacking off, tardiness, job switching and general militancy increased. The US topped the OECD’s table in strikes per worker in 1954, 1955, 1959, 1960, 1967 and 1970.
This did not go unnoticed by business. Commenting on the causes of the 1970-1971 recession following the long expansion of the 1960s, a front-page Wall Street Journal article (January 26, 1972) noted that:
‘Many manufacturing executives have openly complained in recent years that too much control had passed from management to labor. With sales lagging and competition mounting, they feel safer in attempting to restore what they call “balance”.’
It’s hard to overestimate the impact of new regulations, redistribution and labor militancy on business. Regulations are a class thing, and we shall see how they inspired the regulated to respond in self-defense as a class. We might begin by contrasting neoliberal anti-Keynesianism with the standard postwar efforts of business to influence government.
To the extent that business sought to mobilize before neoliberalism, its tactics were fragmented and limited in scope. The airline industry would lobby the Civil Aeronautics Board and/or bribe a favorite senator (e.g. Washington state’s Scoop Jackson, the “Senator from Boeing”), steel companies would lean on Congress for protectionist legislation, energy producers got tax breaks from their congressional favorite, and firms would target trade organizations. Much of this was done through personal contacts. Individual firms and specific industries had their own strategies; there was no cross-sectoral means of resistance to threats to business as a whole. But it is the nature of regulations to pose just such threats by affecting many industries at once. It is no surprise, then, that business should respond with a call for a new form of class mobilization, an all-business attempt to secure State power by political means less dramatic, though no less effective, than an out-and-out coup.
The Counterrevolt of Capital: The Legacy of the Powell Memo
Toward the end of the nineteenth century Morgan had urged industrial capital to organize itself within the private sector. During the Great Depression big capital galvanized its energies politically, in a coup attempt to sieze State power. The next major effort by business to coordinate and mobilize itself was also a political action, again aimed at control of the State apparatus, but this time with a strategy of methodical long-term class warfare.
In 1971 future Supreme Court justice Lewis Powell distributed among business circles a memo intended to politicize the captains of industry in resistance to the legacy of the New Deal and Great Society. The memo reads like a neoliberal instruction booklet:
“[the]American economic system is under broad attack. Business must learn the lesson…that political power is necessary; that such power must be assiduously cultivated; and that when necessary, it must be used aggressively and with determination – without embarrassment and without the reluctance which has been so characteristic of American business…. Strength lies in organization, in careful long-range planning and implementation, in consistency of action over an indefinite period of years, in the scale of financing available only through joint effort, and in the political power available only through united action and national organizations.”
In their remarkable book Winner-Take-All Politics, political scientists Jacob Hacker and Paul Pierson describe the organizational counterattack of business as “a domestic version of Shock and Awe.” The accomplishments are impressive:
“The number of corporations with public affairs offices in Washington grew from 100 in 1968 to to over 500 in 1978. In 1971, only 175 firms had registered lobbyists in Washington, but by 1982, nearly 2,500 did. The number of corporate PACs increased from under 300 in 1976 to over 1,200 by the middle of 1980. On every dimension of corporate political activity, the numbers reveal a dramatic rapid mobilization of business resources in the mid-1970s.”
This period also saw the birth of militant mega-organizations representing both big and small business. In 1972 the Business Roundtable was formed, its membership restricted to top corporate CEOs. By 1977 the Roundtable’s membership included the CEOs of 113 of the top Fortune 200 companies. The chairman of both the Roundtable and Exxon in the early Reagan years, Clifton Garvin remarked “The Roundtable tries to work with whichever political party is in power… as a group the Roundtable works with every administration to the degree they let us.”
The Conference Board further sharpened capital’s political focus by gathering leading executive especially well positioned to personally contact key legislators. The Board developed an ingenious agenda: to learn the tactics of public interest groups and organized labor in order to subvert the agenda of those very groups.
The Roundtable and the Board lobbied and established ongoing relationships with Congressional staffs. Organizations representing smaller firms also grew rapidly in the 1970s. With higher unit costs and no oligopoly pricing power to offset the administrative costs of regulation, these firms were highly motivated to mobilize. The Chamber of Commerce and the National Federation of Independent Businesses doubled their membership, with the now very effective Chamber tripling its budget.
It was during this period that the corporate presence on the Hill became conspicuously ubiquitous. While business had always been disproportionately represented in DC, never before had the chambers of legislation seen such thoroughgoing corporatization.
Corporate strategy was not merely a matter of bribing top politicos. The biggest organizations had learned their lessons well from their antagonists, the public interest groups pressing the popular demand for regulation, and organized labor. The business counterrevolt mimicked the strategies of those groups. Corporate groups used their ample resources, including sophisticated marketing and communications techniques, to organize mass campaigns composed of a heterogenous grouping of shareholders, local companies, employees and mutually dependent firms like retailers and suppliers. Washington would be deluged with phone calls, petitions and letters pushing business interests.
In short order elites surpassed both public-service organizations and organized labor in what they had done best, bottom-up organizing.
Within ten years the corporate takeover was well established. In the 1980s corporate PACs shelled out five times as much money to congressional campaigners as they had put out in the 1970s.
The agenda of the political infrastructure of rallied capital was to undo those policies and State priorities which had generated the redistribution and labor activism limiting the freedom of capital and enhancing the power of workers for almost three decades. In sum, the legacy of the New Deal and Great Society had to be undone. But these were political-economic projects which required ongoing bolstering by the State if they were to be kept effective. Mobilized capital had to capture the State and render it inoperative for proletarian purposes. The State had to be as explicitly reconstituted as a capitalists’ State as the elite perceived it to have been hitherto rigged for workers and against the Big Boys. This required the functional equivalent of a coup.
And a coup there was. Simon Johnson, former chief economist of the International Monetary Fund, wrote in one of the nation’s major weeklies of the “the reemergence of an American financial oligarchy” in “The Quiet Coup”, The Atlantic (May 2009). Johnson made it clear that his use of “coup” was not intended as a rhetorical flourish or a metaphor. Finance capital had effectively privatized the State. Neoliberalism had succeeded not merely in guaranteeing permanently reactionary governments, it had captured the State itself. Previously, a change in government -e.g. from the Eisenhower to the Kennedy administration- might mean a significant change in domestic policy within the context of an abiding Keynesian State. Neoliberalism has sought to change the fundamental priorities of the State.
Mission Accomplished: The Privatized Neoliberal State
All of the major developed capitalist countries have deindustrialized over the past thirty years. The industrial capacity of the West is overripe, and widget production has accounted for a declining share of total output, total employment and total profits in these once-democracies. FIRE’s shares have correspondingly risen, and its top dogs now rule the roost and call the global shots. This has gone hand in hand with a string of financial crises. (2) This setup requires much more, not less, State implication in economic life.
To bail out or not to bail out – and who is to be rescued at whose expense? How is manufacturing to thrive in the current climate of intensified competition among deindustrialized developed countries, with the emerging markets poised to enter the fray? The present answers to these questions are clear. The financial elite get everything while manufacturing is “restructured” as a low wage sector targeting the world’s fastest growing markets, which are not to be found in the imperial metropoles. Unemployment rates are to be kept high until the wage level drops low enough to render the US an effective competitor in global markets. None of this could begin to get off the ground without massive State collusion with corporate interests. The financial bailout and Obama’s restructuring of the auto industry are but the most conspicuous of many examples. The new State is to become -has become?- a capitalist State not in the trivial sense of the State of a capitalist country, but as a State unambiguously by and for Big Wealth.
Putting the Class Character of the State on the Political Agenda
The government is not the same as the State. The governmental alternatives -Republican or Democrat- within the context of an anti-Keynesian neoliberal State must be so limited as to count as no alternatives at all. That there is not a dime’s worth of difference between the Parties is what we should expect, given the dismantling of the State’s postwar social functions. If the remnants of the New Deal and Great Society are regarded by the State managers as “the old time religion”, as Obama characterized them in The Audacity of Hope, then the policy alternatives must be, from the perspective of working-class interests, piddling, and the pseudo-squabbles between the Parties inconsequential.
The historical unfolding of American capitalism has put the class character of the State squarely on the political agenda. It has been the plutocracy’s top priority for a long time. It is clearer to more Americans than ever that the entire political establishment is unprepared and unwilling to manage the economy and the State in the interests of working people. The ruling-class concerns of the neoliberal State homogenizes policy options and renders standard Party politics otiose and obsolete. An effective Left political program must make available to its constituency a radically revised conception of what it means to do politics. No less important is the forging of a political practice which compellingly incarnates that radical reconception. An independent OWS is just what such a practice would look like in its embryonic stages. Very much hinges on how that movement develops.
Notes.
(1) References to Keynesian policy require the reminder that Keynes encouraged economic policy far more radical than what the New Deal and Great Society offered. Perhaps the most neglected Keynesian prescription is his insistence that fiscal policy and government employment are not tools confined to recessions. Keynes held that full employment required ongoing targeted government stimulus, even during cyclical upturns.
(2) Savings and loans (early 1980s), Mexican debt crisis (1982), Mexican peso crash (1994, one year after the passage of NAFTA), Asian Financial Crisis (1997), Russian devaluation and default (1998), Argentina’s eebt crisis (2001), Enron (2001), Worldcom (2002), the hi-tech, dot.com bubbles of the late 1990s and the present turmoil, unparalleled of its kind in the history of capitalism.
Alan Nasser is Professor Emeritus of Political Economy at The Evergreen State College in Olympia, Washington. This article is adapted from his book in progress, The “New Normal”: Chronic Austerity and the Decline of Democracy. He can be reached at nassera@evergreen.edu
Commentary No. 317, Nov. 15, 2011
"The Paris-Berlin-Moscow Axis Back Again"
It always amazes me how the world's politicians and media spend most of their energy debating geopolitical prospects that are not going to happen, while ignoring major developments that are happening.
Here is a list of the most important coming non-events that we have been loudly debating and analyzing: Israel is not going to bomb Iran. The euro is not going to disappear. Outside powers are not going to engage in military action inside Syria. The upsurge of worldwide popular unrest is not going to fade away.
Meanwhile, to minimal serious coverage in the media and on the internet, the Nord Stream was inaugurated in Lubmin on Germany's Baltic Coast on Nov. 8 in the presence of Pres. Medvedev of Russia and the prime ministers of Germany, France, and the Netherlands, plus the director of Gazprom, Russia's gas exporter, and the European Union's Energy Commissioner. This is a geopolitical game-changer, unlike all the widely discussed non-events that are not going to happen.
What is Nord Stream? Very simply, it is a gas pipeline that has been laid in the Baltic Sea, going from Vyborg near St. Petersburg in Russia to Lubmin near the Polish border in Germany without passing through any other country. From Germany, it can proceed to France, the Netherlands, Denmark, Great Britain, and other eager buyers of Russia's gas.
Nord Stream is an arrangement between private enterprises with the blessing of their respective governments. Russia's Gazprom owns 51%, two German companies 31%, and 9% each for one French and one Dutch company. The proportional investments (and the potential profits) are all private.
The key element in this arrangement is that the pipeline does not pass through Poland or any Baltic state or Belorussia or Ukraine. So, all these countries not only lose whatever transit fees they could charge but cannot use their intermediary location to hold up supplies of gas to western Europe while they negotiate deals with Russia.
The German press agency, Deutsche Welle, headlined its story "Nord Stream: A commercial project with a political vision." Le Monde headlined its story "Gazprom is established as a global energy actor." Joseph Bauer, energy expert from Deutsche Bank Research in Frankfurt am Main, opined "It's both a political and a commercial project, and it makes sense on both the economic and political level."
Meanwhile the Russians have told the Chinese that they will not sell them their gas at 30% below the European prices, saying they see no need for Russia to subsidize the Chinese economy. And they have made it clear to Turkmenistan, which has enormous natural gas resources, that they will not appreciate its exporting gas other than via Russia. The Nord Stream launching comes within days of the announcement by the new president of Kyrgyzstan that he expects to close down the U.S. military air base at Manas when its lease expires in 2014. This base has been crucial in U.S. supply links to Afghanistan. Clearly, Russia is strengthening its hold on the Soviet Union's former Central Asian republics.
Both East-Central Europe and the United States are discovering that the scheme to prevent the creation of a Paris-Berlin-Moscow axis is not viable. The European Union's central mechanisms are bending before this reality, as are many of the east-central European countries. This is most difficult for Ukraine, which is torn apart by these developments. And the United States? What in fact can they do about it?
by Immanuel Wallerstein
[Copyright by Immanuel Wallerstein, distributed by Agence Global. For rights and permissions, including translations and posting to non-commercial sites, and contact: rights@agenceglobal.com, 1.336.686.9002 or 1.336.286.6606. Permission is granted to download, forward electronically, or e-mail to others, provided the essay remains intact and the copyright note is displayed. To contact author, write: immanuel.wallerstein@yale.edu.
These commentaries, published twice monthly, are intended to be reflections on the contemporary world scene, as seen from the perspective not of the immediate headlines but of the long term.]
Can it really be 25 years since I first intruded into your family's life, on my birthday, called your dad on the phone because another actuary that we had both worked with said, "You remind me of this other actuary, Bill ######."
Yes, oh ray of light, shining so bright,
Dancing so gracefully all day
Dancing so gracefully all night
I seldom read my e-mails at this addy any more, and so just found this tonight, after an interesting five days in a mental hospital (checked my own self in - anything to get away from my father, at the time, who was being quite the jerk, what with my mom having died and all, he really ought to have offered me parting words other than these: "Who's going to take care of me?" {as I left to wend my way on my own to a mental health clinic, ending up not at the one I sought - transportation still being something of an issue with me - but another one, which got me rested up, my blood pressure down from 195 / 140 to about 140 / 85 and my blood sugars from about 325 to 125 ... my oh my oh my oh my - some bad sugar habits had evolved, my sweet one})
Ah, yes, them; fathers. So often entirely clueless about how to treat their daughters and all too often cavalier by too much with their quips when they should have kept their mouths shut, their tongues tied, and their ears opened and been prepared NEVER to judge .... but, by and large, it is not in their nature.
So, I blog (probably the world's most prolific bloggers, not merely because I run about 19 of the things, but because I post 100's of postings - ugh, horrid syntax - per week, when I'm all a'fire)
MarkGanzersBlog.Blogspot.Com was my first blog.
I tried to kill it, by not posting, and three months later, I was getting over 200 hits a day. I now post international issues there.
MarkGanzersInsanityBlog.Blogspot.Com -- US politics, cultural commentary, media criticism
MarkGanzersWritings.Blogspot.com -- my creative writing
MarkGanzersPhotos.Blogspot.com -- stuff from my extended families
You might be interested.
Or not.
From everything I ever knew about you, you were a bona-fide Genesis I child - perfectly formed in God's own image, and you were good. None of this could have possibly changed. You are now the you you always were going to be, joyous, loving, and yet .... honest, righteous, courageous. And these traits, while all are admirable, and we are taught all are traits we should attempt to attain and hone, these are traits that are virtually never appreciated by, hmm, how shall I say this next word ... assholes?
Too harsh perhaps. Too crude. Not appreciated by those whom ostensibly have power over you - parents, teachers, preachers, cops, bosses, etc, etc.
It terrifies them to be told the truth - most people are ill-suited for what they do - they just fall into it. They are lazy, incompetent, sometimes willfully so, sometimes just mismatched with where their true love of doing is and what they are doing instead is - doing in order to worship at the altar of consumption, at the altar of appearances, at the alter of never criticizing the institution which pays for their daily bread, and their useless toys, and poisonous food, and unhealthy attacks on their intellect and integrity.
But, I speak in generalizations; I speak mythically.
But, because I once knew you, and quite well, because you were always the BEST ANGELA you could be (and you gave this matter more than a little thought - you were kind, caring, sharing, giving, forgiving, nonjudgmental, but oh so brutally honest - as in "the emperor has no clothes" that honesty which the child's eye always sees, and which the child's heart and mind cannot keep silent on -- because the weak are exploited, and this is wrong, and the child always knows right from wrong.
I want you to remember this always:
you made a broken, middle-aged man feel loved
you were a model of what a free spirit this fat, balding,
middle-aged man might become
if only he were to free himself from
the unrewarding job of always trying to please everyone
and in the end pleasing no one,
least of all, his own self
And thus the poet / mystic / wrote: To thine own self be true.
And these words, to me, will always define you.
I am here, as you can see, or
xxxxxxxxxx@yyyyyyyyyy.com (only my most cherished and beloved of friends know of this e-mail)
and still at (847) @@@ - zzzz
And I love to ride the rails on the weekend unlimited rail pass
And thus do I pass through Chicago frequently,
And have come to find many comforting places
And friends who welcome me back again and again
And if you would like me to be your friend (still)
Then I shall be (and I always will)
With Love to you, and ALL You LOVE,
Mark Raymond Ganzer
(VARK)
Sorry for my absence - got so, hmm, how shall I say this? FRUSTRATED with dad last Thursday (11-10-11) that I ended up calling 9-1-1 to be taken to an ER (dad wouldn't drive me to Elgin Mental Health Center) went to St Alexius, from there to the most remarkable facility - remarkable in that they were so overt on the spiritual aspects of being human, that, for SOME of the psychiatric bent, it would have been borderline grounds for commitment of the institution - for believing in something bigger than our selves, fate, a God Who watches over us ..
But, by and large, it was just a place to house people with problems that the legal system does not (yet) want to deal with as criminals ... and basically the staff spent most of its days eyes buried on the computer screen, or hanging out at the nurses station and talking - which explains why they let this one guy out of their sight and he ended up walking into my room, and opening the bathroom door, that I was inside the bathroom (gargling only) ... frickin creep - and I called them on it.
I was also the one that told them that my roomie, Alonzo, who had three voices that he would talk in, got very cold at night, shivered like crazy, which kept him awake, until I got him an extra blanket and an extra sheet, after which he fell asleep in about 5 minutes, snored for 15, then slept the rest of the night through, without waking, like a little loved-by-God baby ...
Met some very nice, wonderful people, who kept me grounded (this always happens) and also met the most manipulative person ever in my life (hospital staff characterized her as "an incredibly high-functioning psychotic" and ended up getting released, just tonight, without even asking to be released (they had a huge population influx, which explains THAT) ...
Hopefully dad (whose last words to me were, "Who's going to take care of me?" ... jeezuz h krist on a krost, RALPH - must EVERY"THING be about you? you are not quite getting "it" that I would RATHER BE IN A NUT HOUSE than living here with you (as the present relationship has unfolded) .. but, I think he's starting to get it ... he has lost another 6 pounds in my absence, he's shrunk at least 4" since mom died, his primary physician REALLY thinks he needs the colonoscopy and MEANWHILE - he avoids grief counseling as if it were a rattle snake or syphlittic slut ... me thinks ... he is not long for this world (I guess he'll be dead within a year of mom's death - just like his own mother went after his dad died; within one year)
At that point in time, my life becomes my own, for the first time ever.
This story has been getting a lot of ink in the Chicago Tribune, once a great newspaper, now just a cost-cutting excuse to sell advetising space to idiots, like those in our household, who are willing to pay the Trib to have their ads delivered on our driveway every morning about 4:30 am.
There are allegations, made by women, who are identified by name, that Cain groped them in automobiles. Cain's wife is disgusted by the allegations. Both women named are registered Republicans. The one who has not gotten an out-of-court settlement can't seem to go anywhere without the papers reporting the number of bankruptcies she has filed, as if the number of bankruptcies she has filed has ANYTHING in the world to do with whether or not this serial groper groped her. This women is engaged to a man in whose home she is living, with her 13-year old child, who was apparently born out of wedlock. Her husband is very supportive of her for telling this fairly sordid, but too 'oft repeated story, of how an attractive woman, having lost her job, gets inspired by an inspirational speaker who happens to be the owner of a very large and successful company, as well as an executive with the National Restuarant Association.
At an NRA dinner, she was so impressed with him, that she took the time to talk with him, and tell her story, in the hopes that he might be able to help her get a job. While in the car, he forced himself on her, acting like the typical male pig, for whom the thinking goes like this:
Hot chick digs me.
Hot chick wants something from me.
Hot chick hopes I can get her a job.
Sure, hot chick, I can get you a job.
But, hey hot chick, you know you WANT me.
Because I'm a REAL MAN.
So, here, because you want me,
Let me put my hand up your dress
to fondle your genitals,
and let me put my other hand
on your head, to better guide it
while you give me some head.
Quid pro quo, hey baby!
Interesting scenario, and as I said, one that plays out often enough. Although, hopefully, neither of them was driving, which leads me to conclude that SOMEWHERE out there is a limo driver who knows enough about the facts of this story to confirm or deny one way or the other, BUT, since Cain undoubtedly paid for the limo, unless the guy says, "Yeah he groped her and tried to make her suck his dick," his story will be tainted by the guy who's got the big green.
Let's logic this out. The woman has an attorney. Her fiance has a good job, that pays decent bucks, and can afford the nice house he is living in, where she stays, now a stay-at-home mom, which is probably a great deal for her (don't we all wish every mom who wanted to be a stay-at-home mom could be; it would go a long ways towards bringing back some balance into the lives of children, many of whom only see their parents at supper time, and even then, not for too long at all). The attorney ought to be competent, and ought to have adivsed this woman that she will be subject to much media scrutinty, that her child will learn of this, that her family, friends, relatives, will learn of this; that she will be dragged through the mud by a very powerful, wealthy, and likely vindictive man whose political career is about to explode in his face. It will be very painful, very stressful, a very trying time.
And yet, knowing this going in, she goes ahead, tells her story, and allows herself to be identified.
All the while, the newspaper and the TV news keep harping about her bankruptcies, some of which are recent.
About those bankruptcies. I'd really like to know the names of the banks and/or savings and loans that gave her the damn loans in the first place (with her history of defaulting and declaring bankruptcy). THIS to me is the REAL STORY, the subtext. What in the world induced her loan officers to give her the bank's money?
Well, we can fairly well logic this out too. She is an attractive woman, dresses nicely, speaks well. Face it, she's hot. She has also undoubtedly learned how to use her female charms to flatter men, to make them feel as if she appreciates them, likes them, perhaps for more than merely their place in her life as a loan officer; perhaps, if they do this thing for this hot chick, she will put out for them later on.
Guys, we THINK like this, and we take eye-to-eye contact, and a woman being comfortable in our presence as a SIGN, a SIGNAL, "She likes me; she thinks I'm hot; she WANTS ME!"
Face it, guys, we cam be PIGS in this arena.
Nobody teaches the class on "How to deal with a hot chick that gets your dick-to-twitchin' while she tries to advance her career or her life-style but she doesn't want your advances, just what you can do to help her 101."
Vivacious, attractive, even flirty women grab out attention. Hell, vivacious, attractive women grab our attention. HELL, WOMEN grab our attention. Even Jimmy Carter had "lust in his heart." (I do not find credible the alleged words of Jesus of Nazareth, "even if you have lust in your heart, you have been unfaithful to your wife," UNLESS, he was just making an observation - hey dawg, you see that fine female stuff and you would risk everything in a heart beat for somethin' that ain't gonna be real, and ain't gonna last more than a couple of minutes, GROW UP, Y'ALL."
So, should we the people hold it against Cain that he's a serial groper? AND, if you think about it for any length of time at all, he might NOT EVEN REMEMBER IT, because, this was the National Restuarant Association's dinner, and, be assured, the drinks were flowing to over-flowing, and the guy WAS NOT SOBER, and may in fact not even remember (putting the most charitable construction on all that he does, here). Which just makes him a drunken serial groper.
So, does this disqualify him from potentially beind POTUS?
Hell, we've had nothing but war criminals in the Office of the President of the United States since Kennedy, and it doesn't seem to bother us at all.
Personally, I'd rather have a drunken serial groper who would STOP ALL THE WARS. At least he just leaves psychic wounds. This would be a splendid improvement in the human condition around the world.
DO NOT LET CAIN'S SERIAL GROPING PREVENT YOU FROM VOTING FOR HIM IF YOU LIKE THE REST OF HIS POLITICS!
NOVEMBER 09, 2011
His name was on the lips of everyone I talked with in South Korea last week. As an underdog with little name recognition but a long history of progressive organizing, he came from behind late last month to become the new mayor of Seoul.
Remember his name. Park Won Soon is perhaps the first politician to win with an Occupy Wall Street platform.
A founder of the watchdog organization People’s Solidarity for Participatory Democracy (PSPD), Park has been a key leader in Korea’s vibrant civil society. After a couple decades as a political gadfly, he is now in a seat of considerable power. And people are talking about him not only for the positions he staked out as an independent candidate, which focused on social welfare issues, but for the potential of his victory to transform Korean politics in 2012. The implications for South Korea’s relations with the North, with its other neighbors, and with the United States are enormous.
I met Park Won Soon more than a decade ago, when he was just starting to think beyond PSPD. Korean civil society activists are always working, always networking and multitasking, and they sometimes joke that they only take vacations when hospitalized for exhaustion. Park, on the other hand, always struck me as exceptionally serene. The names of the organizations he built after PSPD — the grant-making Beautiful Foundation and a think tank called the Hope Institute — reflect his optimistic disposition and his desire not just to change Korean politics but to transform Korea’s overall sago bangshik, or way of thinking. He also possesses tremendous powers of persuasion. Once he even convinced the top South Korean steel company POSCO to underwrite fellowships for civil society activists to study in the United States. Try to imagine a similar partnership between Chrysler and Moveon.org.
This former watchdog now runs a city of over 10 million people, larger than Tokyo or Mexico City or any city in the United States. Seoul is responsible for almost 50 percent of the country’s GDP (New York, by comparison, is responsible for about 8 percent of U.S. Gross Domestic Product, Beijing about 3 percent of China’s). So, essentially, Park Won Soon is in charge of a mid-sized country, minus the foreign and military policy. Given Seoul’s disproportionate weight, the mayoralty is a political stepping stone, and one of Park’s predecessors in the job, Lee Myung-Bak, is now the conservative president of the country.
But Park Won Soon is not a career politician. He is more interested in the delivery of services, particularly to the less advantaged. “We must make sure no one is sleeping cold and hungry under the skies of Seoul,” he told his staff. On his first day in office, Park expanded the free lunch programto all elementary school children, a major commitment to universal entitlements that will ensure support across class lines. His effort to reduce university tuition at the publicly funded University of Seoul is a big thank-you to the huge number of young people that supported his campaign. He has been skeptical about a number of high-profile infrastructure programs in Seoul, preferring to focus on building more public housing. And he has pledged to increase social welfare spending in order to reduce economic inequality.
Rising inequality, which has spurred the growth of the Occupy Wall Street movement and its spread worldwide, has been a major problem in South Korea. For instance, the country ranks an impressive 15th in the world in the UN’s Human Development Index. But if income inequality is factored in, it drops to the 32nd position, a loss in rank exceeded only by the United States and Colombia. By decrying this inequality and labeling his opponent a member of the 1 percent, Park may be the first politician to rise to power in the Occupy Wall Street era – and he won’t be the last.
Park’s election has upended political expectations in Korea. As a political outsider, he nevertheless trounced the ruling Grand National Party (GNP) candidate Na Kyung-won. Na had some powerful backers. The most prominent was the GNP’s Park Geun-Hye, who is the daughter of former authoritarian leader Park Chung-Hee and a leading contender in the 2012 presidential race. That Na lost, and lost badly, reflects the unpopularity of President Lee Myung-Bak, whose approval rating hovers around 32 percent. The most popular podcast in Korea these days is a low-budget affair that features four guys sitting around a table slagging the president.
Next year South Korea will hold parliamentary elections in the spring and then presidential elections in the winter. The opposition Democratic Party smells blood. It has already shifted into high gear in the Korean parliament to defeat the recently signed free trade agreement (FTA) with the United States. But Park Won Soon’s victory will not translate directly into a victory for the Democratic Party. After all, he initially ran as an independent before agreeing to a unified ticket. Crucial backing came from Ahn Cheol-soo, a maverick academic and software tycoon who has largely avoided political parties. Ahn’s endorsement boosted the future mayor’s approval rating from 5 percent to nearly 50 percent. Korean voters, like their counterparts all over the world, are rejecting politics as usual and the ritual do-se-doing of parties.
During the election, Park didn’t say much about national policy, instead concentrating on municipal matters. But he has expressed concern about the FTA and criticized the current administration’s confrontational approach to North Korea. He has also indicated interest in joining the organization Mayors for Peace. These stands will embolden other politicians to follow suit. And they point to a repudiation of Lee Myung-Bak’s foreign policy and a return to the more independent initiatives of previous leaders Kim Dae Jung and Roh Moo-Hyun.
In a country where social hierarchy is deeply entrenched, where the language has multiple levels of address depending on social rank, Park Won Soon’s most radical policies may well lie in his hands-on, bottom-up approach. When addressing his management team, he uses the humble form of address and has asked his subordinates not to rise when he walks into the room. And last week, the new mayor showed up at 6 a.m. in a fluorescent green uniform to clean the Seoul streets in the morning trash pick-up. This was no mere photo op. Park is genuinely interested in the perspectives of all the citizens of Seoul.
Park Won Soon is certainly not the first civil society organizer to win political office in Korea. But he may be the first to combine a reformist platform with a commitment to revolution – a revolution in social values.
John Feffer is the co-director of Foreign Policy in Focus at the Institute for Policy Studies, writes its regular World Beat column, and will be publishing a book on Islamophobia with City Lights Press in 2012.
NOVEMBER 09, 2011
Reflections From Tunisia
by DAVID TRESILIAN
Tunis.
Some nine months after the country’s January Revolution and the ousting of former president Zein Al-Abidine bin Ali from power, Tunisia took a further step on the path to democratic government late last month when elections were held to elect the constituent assembly that will write the country’s new constitution.
With all the votes now counted and appeals to the country’s independent elections authority closed, the results are a clear vote of confidence in the Islamist Al-Nahda Party, banned under Bin Ali, to lead Tunisia’s transition towards a new and democratic future.
As the results were announced last week, the mood in Tunis was one of trying to digest the significance of the Al-Nahda victory at the polls and what this might mean for the country’s new constitution and the shape of its next government.
Yet, according to analysis in the Tunis press the Al-Nahda victory, though impressive, has not been overwhelming. Of the more than seven and half million Tunisians theoretically able to vote, only a little over four million in fact did so, making Al-Nahda’s 40.5 per cent of the vote something like 20 per cent of the electorate as a whole.
Moreover, with 90 seats in the new constituent assembly out of a total of 217, Al-Nahda, though the single largest party, does not possess an absolute majority, suggesting that it may need to enter into coalition with one or more of the other parties that won seats in the elections.
According to the results announced last Thursday, these parties were: the Congr̬s pour la R̩publique, 30 seats; Ettakatol Party, 21 seats; Al-Aridha, the Popular Petition Party, 19 seats; the Parti d̩mocrate progressiste, 17 seats; the P̕le d̩mocratique moderniste, a coalition of smaller leftist parties, five seats; and Al-Moubadara, five seats.
A sprinkling of smaller parties won a further two or three seats (Afek Tounes: three seats; Al-Badil Al-Thawri: three seats; Mouvement des patriots democrats: two seats).
According to Rachid Ghannouchi, co-founder of the Al-Nahda Party, who returned to Tunisia after two decades in exile after Bin Ali’s flight in January, the Party would be willing to join forces with any of the other parties that opposed the Bin Ali regime in writing a new constitution and in governing the country.
The main candidates for any coalition arrangements with Al-Nahda, Tunisia’s various leftist parties, were also the clearest losers in the recent elections. Either because they were not sufficiently organised to fight convincing campaigns, or because they failed to convince their supporters to turn out to vote, these left the field open to Al-Nahda and its dynamic secretary-general Hammadi Jebali to sweep the board, the latter being widely tipped to become Tunisia’s next prime minister.
Of the leftist parties contesting the elections, the Congrès pour la République (CR), led by one of Tunisia’s longest-standing opposition politicians, Moncef Marzouki, did best, winning some 345,000 votes, though this was still less than a third of Al-Nahda’s one-and-a-half million.
The CR was followed by the Ettakatol Party, led by veteran opposition politician Mustafa Bin Jaffar, this winning some 254,000 votes. Both Marzouki and Bin Jaffar are believed to have benefited from their long-standing opposition to the Bin Ali regime, with both men also having spent long periods in prison.
Comment in the Tunis press has not shed light on these parties’ intentions, and perhaps they themselves are still digesting an electoral showing that, while not excluding them from deliberations in the constituent assembly, nevertheless prevents them from playing a leading role.
According to an analysis of the results by Hatem M’Rad, a professor of political science at the Faculty of Political and Social Science in Tunis, which appeared in the Tunis papers on Monday, the leftist parties should be thankful that the results were not worse.
Had a first-past-the-post elections system been used, M’Rad wrote, instead of the proportional one that had in fact been employed, then Al-Nahda would have won all 217 seats in the constituent assembly instead of a little under half of them.
Al-Nahda, M’Rad wrote, “is the victor. The Party won the most votes in all the constituencies in the country, both in the 27 constituencies in Tunisia proper and in the six constituencies abroad. It won 90 seats out of a total of 217, which is 41.47 per cent of the total.”
“In the parliamentary elections in 1989, Al-Nahda got 13 per cent of the seats when it fielded candidates on independent lists as it was banned at the time. Between 1989 and 2011, Al-Nahda has increased its results from 13 per cent to 41.47 per cent, 13 per cent when it was an illegal party and 41.47 per cent when it was a legal one.”
Al-Nahda support was particularly high in popular areas and in Tunisia’s larger towns and cities, M’Rad wrote, the party exploiting what he called its campaign of charitable works and its populist discourse to persuade the less well-off that “God was to be found in the ballot box.”
In nine constituencies covering the country’s largest towns and cities, Al-Nahda won 35 of its 90 seats in the constituent assembly, in other words more than a third of the total number, M’Rad wrote.
For the time being, the only protests at the results of the elections and the way in which they were run seem to have been in the town of Sidi Bouzid in the centre of the country, ironically the starting point of January’s Revolution, where riots last week left sections of the town off limits and saw several public buildings destroyed.
The immediate cause of the riots seems to have been the decision by Tunisia’s electoral authority, the Instance supérieure indépendante pour les elections (ISIE), to invalidate six lists of candidates put forward by the Al-Aridh Party, also dubbed the Popular Petition Party, which is run from abroad by businessman Hachemi Hamdi, who is originally from Sidi Bouzid.
Immediately following the news of the invalidation of the lists, on the grounds that the candidates had received financing from abroad, Hamdi announced on his Al-Mostakilla satellite TV channel that he would be withdrawing all Al-Aridh Party candidates, as participating in the elections now “made no sense.”
This decision has subsequently been reversed, allowing Al-Aridh to conserve its 19 seats in the constituent assembly, but mystery still surrounds the cause of the riots in Sidi Bouzid, which were apparently directed partly against the Al-Nahda Party.
According to the Tunis press this week, the riots had broken out after Hammadi Jebali had described the residents of Sidi Bouzid as “idiotic peasants” on the Al-Nahda Party’s Hannibal TV station, with last weekend’s papers saying that tracts protesting against the town’s treatment by “the political elites and national media” had also been found in Sidi Bouzid.
Nevertheless, the newspaper La Presse said in its weekend edition that the riots in Sidi Bouzid had not broken out as a result of the invalidation of the Al-Aridh Party lists, contrary to what had been said in the international media. Instead, the paper detected the hand of members of the former regime who were seeking to spread chaos in the country as a way of destabilising the achievements of the Revolution.
“All the country’s political parties are as one in insisting on the need to unmask the enemies of the Revolution who have used this occasion to throw the Sidi Bouzid region into chaos following the holding of elections that have been praised worldwide for their transparency and fairness,” the paper commented on Monday.
Nevertheless, the fact remains that Rachid Ghannouchi has several times said that the one party that Al-Nahda will not cooperate with in any future coalition is Al-Aridh, describing Hamdi as having been “an ally of the dictatorship” of former president Bin Ali.
Describing the Party’s post-elections programme, Ghannouchi told the French newspaper Le Monde in an interview at the weekend that Al-Nahda’s priorities were economic and social ones, and that the Party intended to concentrate “on issues that have an immediate impact on people’s lives, such as security, development, ensuring stability, reforming the justice system, and bringing those accused of corruption to justice.”
This message, heading towards “a coalition of all the national forces” in Tunisia, and based on “Islamic values such as equality, brotherhood, trust and honesty,” Ghannouchi repeated in a press conference in Tunis last week, in which he said that Al-Nahda had no intention of “turning Tunisians into hypocrites and making them present themselves in any way other than they are.”
“I support the right of every Tunisian man and woman to dress how he or she pleases and to live in the manner of his or her choice,” Ghannouchi said, adding that the Party’s priorities were the realisation of the objectives of the Revolution, among them that every Tunisian man or woman should be able to live in dignity and free from unemployment and poverty.
This is a message that has gone down well with Tunisians answering questions from Al-Ahram Weekly. People approached in Tunis earlier this week for their opinions on the new turn the country was taking in the wake of last month’s elections all said that Al-Nahda’s victory had been a good thing for the future of the country.
Al-Nahda had not been implicated in the corruption of Bin Ali’s “mafia regime,” one respondent said, adding that their supporters had been imprisoned “in the tens of thousands” by the former regime’s security services and “hundreds had died or been tortured.”
On a trip round the town of Carthage near Tunis, which also houses the ancient Roman and Phoenician archaeological site, it became clear that the looted former residences of the Trabelsi family, relatives of the wife of the former president, had now been added to the tourist itinerary.
Carthage is a wealthy area, contrasting starkly with the popular quarters further inland, and the villas of the Trabelsi family have been stripped of everything that can be carried away, with revolutionary graffiti sprayed on walls for good measure.
None of the other villas had been touched, and the fury of the revolutionaries had been directed at the Trabelsi family villas alone. “It was an act of vengeance more than anything else,” a driver, Mohamed, explained, also a supporter of the Al-Nahda Party.
“Bin Ali and his family ruled this country for 23 years, and they never did a single good thing for it. Now we are really looking forward to a change.”
David Tresilian writes for Al-Ahram Weekly.
NOVEMBER 09, 2011
1
"End the Wars, Tax the Rich!"
Occupy Wall Street, Not Palestine
by PHYLLIS BENNIS
This is an extraordinary time. The astonishing Occupy Wall Street movement emerged as the heart of our 99%, claimed the little scrap of earth in Zuccotti Park on behalf of all of us, and created a live-in soapbox from which to challenge inequality — how the 1% controls our economy, buys off our government, imposes their wars, and avoids paying their taxes. It both reflects and marks an end to the popular desperation that had taken over so much of our political life — instead, it applied the lessons of the Arab Spring, unexpectedly shaping a connection reaching far beyond the activist core, quickly moving from Wall Street to Main Street to the small parks, the steps of government buildings, the public squares from Oakland, California to Ames, Iowa, from Chicago to DC, to cities and towns across the country.
The challenges facing this new and different movement are legion, but joining its pop-up iterations is an incredible gift to those of us fighting that same outraged despair that first brought this vast disparity of folks to occupy what is now the people’s squares. In New York City, I huddled with GritTV’s Laura Flanders and Peace Action’s Judith LeBlanc, in the driving rain at the smaller-than-usual general assembly at Occupation Wall Street’s Zuccotti Park the other night. It was hard to see over the sea of umbrellas, and the meeting was pretty short. But the people’s mic functioned fine in the rain, as folks discussed a variety of ways to act in solidarity with our Oakland contingent, who had faced a particularly brutal police assault, critically injuring a young Iraq War veteran from Iraq Veterans Against the War and Veterans for Peace.
A couple of weeks ago while speaking at several places in Iowa, I visited the activists of Occupy Des Moines, who had regrouped in front of the state capitol after bailing out 37 of their number who had been arrested by state troopers at the order of the governor. While they stood with their signs, the progressive mayor of the city pulled up, offering a nearby city park as an alternative site, one that would be outside the right-wing governor’s jurisdiction. After a consensus decision, they moved their encampment, demonstrating again how this movement is creating new divides among the powerful.
Occupying DC
In Washington, we have two Occupy encampments. Both have been amazing in bringing new permanence and new breadth to the political resistance long present/absent/present in this city. With other IPSers and a variety of close friends and comrades, we’ve marched with the Occupy folks to protest at the U.S. Chamber of Commerce and elsewhere. We’ve done teach-ins on the Iraq troop withdrawal and the renewed threats against Iran. We’ve had amazing discussions with folks occupying the squares.
Spending a day with the Institute’s Letelier-Moffitt human rights awardees, representatives of Wisconsin’s progressive movement, I hung out for a while at Freedom Plaza, one of the Occupy sites, talking with a brilliant homeless woman. She taught me more about homeless policy in DC than I had ever known. She described life in the shelters, saying that “yeah there’re bedbugs, and there’s no security and they’re way too crowded, but that’s not the real problem. The real failure is that the city government’s mandate is to advocate for our rights, and it’s the rights of homeless people that are being ignored. Their mandate isn’t just for charity, they’re supposed to be advocates for our rights.” She knew the details of the city mandate and what obligations were being ignored — I hadn’t had a clue. This is what this new movement looks like.
Occupying the Future
There are huge uncertainties, of course. Will the encampments figure out how to survive the encroaching winter? Can the iconic center, at Occupy Wall Street’s Zucotti Park, remain the symbolic heart of the national, indeed global movement, as its working groups and caucuses extend out into other parts of the city? Will the Occupy movement figure out how to balance the focus on new ways of living with each other, creating new democratic norms that are, in the new dictum, horizontal instead of vertical, while simultaneously figuring out how to escalate the challenge to power that the creation of the Occupy sites began?
We won’t know for a while. But we do know now, already, that Occupy Wall Street — and Occupy DC, Occupy Des Moines, Occupy Los Angeles and Chicago and Atlanta and Taos, New Mexico — have already shaken up our political stasis in a critically important new way. I’ve been thinking a lot about the first Palestinian intifada, the nonviolent, society-wide mobilization that transformed Palestine’s nationalist struggle beginning in the late 1980s. Palestinian activists chose “uprising” as the logical English equivalent, but intifada doesn’t really mean that — it means something closer to “shake-up” or “shaking out” — exactly what Occupy Wall Street has done to our body politic. It’s our intifada, and it’s shaking up that money-glutted, war-mongering, tax-avoiding 1 % like nothing in a couple of generations.
Milestones: Iraq Withdrawal, Qaddafi is Killed, Prisoners Go Free
In the meantime, the news is full of milestones. President Obama’s announcement that almost all of the U.S. troops still occupying Iraq will come home by the end of the year certainly counts as a huge milestone-to-come. It’s not complete, but it’s a huge victory for our U.S. and global antiwar mobilizations, and especially for the people of Iraq so desperate to see an end to eight years of occupation. It means almost all the U.S. troops, and all the Pentagon-paid contractors will leave by the end of this year — so even with the biggest U.S. embassy ever built, with 5,000 staff, and thousands of security contractors (paid by the State Department this time, abiding by the letter though clearly not the spirit of the get-them-all-out-by-the-end-of-2011 agreement) this is a huge tribute to our years of work. I talked about the troop withdrawal on the Diane Rehm Show on NPR, including some of the history of what the years of war and occupation, plus the 12 years of Washington’s crippling economic sanctions, have meant for the people of Iraq. Also on RT, I examined the consequences of the war for Iraqis.
And of course the killing of Libyan leader Muammar Qaddafi, after he was captured alive, marked another grisly milestone in the Libyan civil war. In my article on salon.com, I wrote about how vulnerable Libya remains: still oil-rich but more divided than ever, after Qaddafi’s death. Far from “liberation,” Libya continues to face a host of serious dangers.
We also had a nice victory for popular mobilization. CTV, the Canadian network that had given in to pressure and removed my interview on Mahmoud Abbas and the Palestinian UN statehood bid, put it back on the website when they got enough letters of protest to decide they had to reverse their decision. And they just invited me back, this time to talk about the consequences of Qaddafi’s death. You can watch that CTV interview here.
Occupy Wall Street, Not Palestine!
That’s the slogan coined by the BNC, the Palestinian leadership of the now-global movement for boycott, divestment and sanctions — BDS — that challenges Israeli violations of international law and human rights. And we have yet another milestone, this one on the Palestine-Israel front, the prisoner swap that saw the first 400 or so out of a total of 1027 Palestinian prisoners in exchange for the one Israeli soldier held by Hamas. It was certainly a “win-win” at the human level, but of course there are political causes and consequences too. Here’s the link to the “Inside Story” show I did on al-Jazeera English, discussing the prisoner exchange with my old friend and Palestinian civil society leader Mustafa Barghouti as well as an Israeli colonel. Al-Jazeera also published my commentary on the prisoner swap.
Just as this newsletter was getting ready to go to press, we also got word from Paris that UNESCO voted overwhelmingly to recognize Palestine as a full Member State. According to U.S. policy, that will trigger an immediate cut-off of U.S. dues to the UN’s cultural, education and science organization, as well as ending U.S. dues payments to (and perhaps thus voting rights in) several other important UN agencies — possibly including the International Atomic Energy Agency, which monitors nuclear production around the world. Stay tuned for more analysis next time…
Amazing Times
The Occupy movement is bringing new energy, new activists, new ideas, new strategies into our movements for peace, justice and equality. One of the chants I heard last week, from folks at Brooklyn for Peace where I was speaking, seemed to capture the moment particularly well:
“How do we end the deficit? End the wars and tax the rich!”
It’s good advice. We’ve got a lot of work to do to get there.
Phyllis Bennis is a fellow of the Institute for Policy Studies and author of Understanding the Palestinian-Israeli Conflict: A Primer.
NOVEMBER 09, 2011
0
Why US Retribution Against UNESCO Will Backfire
Exacting a Price
by GRAHAM USHER
The Palestinians scored a victory on 31 October when UNESCO (the United Nations Education Scientific and Cultural Organisation) admitted them into its ranks as a full member, despite an immediate cut of $60 million in American dues, or 22 per cent of the organisation’s budget.
Membership will enable the Palestinian Authority (PA) to register as its heritage such sites as the Nativity Church in Bethlehem and the Ibrahimi Mosque (or Cave of the Patriarchs) in Hebron, both encircled by the Israeli occupation.
Politically, it will give a boost to the PA’s flagging labours to win recognition as a UN member state, a bid currently snared in a Security Council sub-committee and facing a certain United States veto should it emerge from there.
A veto may not be necessary. On 31 October Bosnia-Herzegovina — a swing state on the Security Council — said it would abstain on the Palestinian bid following enormous lobbying by Israel on its Serbian president, which opposes UN membership (Bosnia’s Muslim president supports it while the Croat president passes).
Without Bosnia the Palestinians may lack the majority to force a vote on the council. And without a vote the US need not veto, sparing itself the opprobrium that would roil the region as Washington once again steps in to defend Israel’s occupation against Palestinian self-determination.
There was no similar escape for Washington at UNESCO’s governing board meeting in Paris. Despite the knowledge of the cut in US funds it approved Palestinian membership by a massive majority, with 107 nations voting in favour, 14 against and 52 abstaining.
Among those voting no was America, Israel and Canada. Among those voting yes was nearly every Asian, African and Arab country as well as emerging powers like Turkey, Brazil and Indonesia. Rarely has the global divide on Palestine been so publicly exposed.
And rarely has the absence of a common European Union policy been so palpable. In a flurry of European disarray France voted in favour of Palestine’s UNESCO bid, Germany voted against and Britain abstained. All three are meant to be European “counterweights” to America’s monopoly of the “peace process”. All three sit on the Security Council. It would be unwise of the Palestinians to count on their unity.
Not that PA President Mahmoud Abbas was in any mood for recrimination. “This vote is for the sake of peace and represents the international consensus on support for the legitimate Palestinian national rights of our people, the foremost of which is the establishment of its independent state,” he said, accurately, after the UNESCO landslide.
Abbas’s strategy of taking the case of Palestine to the UN is bearing fruit — not least in extracting a price on Washington for its defence of Israel no matter what it does.
Under Congressional legislation dating from the 1990s the Obama administration is mandated to withhold US funds from any UN agency that accepts Palestine as a full member. However, if the US doesn’t pay its dues to UNESCO it will lose its right to vote in the agency. That’s a disenfranchisement that hurts America far more than the Palestinians or even UNESCO.
Since 2003 — when the US rejoined the agency — UNESCO has been a key plank in American foreign policy, especially in Afghanistan, where it funds the country’s biggest education project. That project may now wither.
UNESCO membership also confers voting rights in other UN agencies, including the World Property Intellectual Property Organisation (WIPO). In the last year the WIPO has advised dozens of US companies on laws protecting intellectual property rights. But “if Palestine joins the WIPO, the US will have to pull out, limiting its ability to advance American interests and create jobs at home,” wrote former Senator, Timothy Wirth, president of the UN Foundation, in the Huffington Post on 31 October.
Finally, the PA’s success at UNESCO will surely spur it to join other heavyweight UN affiliates like the International Criminal Court (ICC) and the International Atomic Energy Agency (IAEA). Membership of the ICC may allow the PA to prosecute Israel for grave breaches of the Geneva Conventions, including the illegal transfer of settlers into occupied territory
Palestinian membership of IAEA would cause a real problem for America’s role in an agency that is central to its policies of containing Iran and North Korea’s nuclear programmes and promoting nuclear non-proliferation, writes Wirth. “Should the US stop paying dues to the IAEA — which it could be forced to do under current legislation if Palestine is admitted as a member — the US would have to give up (its) vote on the board. It would literally lose a seat at the table during the next nuclear crisis”.
Because of its unconditional defence of Israel — and in the name of an imaginary peace process — the US is condemning itself to isolation in a range UN bodies it knows are vital to its national security. That may bring the Obama administration peace with a pro-Israel Congress but risks increasing American irrelevance abroad.
“There are significant problems if [Palestinian membership of UN agencies] begins to cascade,” Secretary of State Hillary Clinton told Congress last month, before UNESCO “cascaded” in Palestine’s favour. “What happens with the IAEA? What happens with the World Health Organisation? What happens with the Food and Agriculture Organisation?” she asked.
NOVEMBER 09, 2011
3
If the Greek People Could Negotiate Directly With the ECB and IMF
Bankers Crush Greek Democracy
by DEAN BAKER
Greek Prime Minister George Papandreou touched off a firestorm last week when he proposed putting the austerity package designed by the “troika” (the I.M.F, the European Central Bank and the European Union) up for a popular vote. The idea that the Greek people might directly be able to decide their future terrified leaders across Europe and around the world. Financial markets panicked, sending stocks plummeting and bond yields soaring.
However, by the end of the week things were back under control. The leaders of France and Germany apparently laid down the law to Papandreou and he backed off plans for the referendum. While the government is in the process of collapsing in Greece, the world can now rest assured that the Greek people will not have an opportunity to vote on their future.
This is unfortunate since it means that Greece’s future will likely be decided by politicians who may not have the interests of the Greek people foremost in their minds. By their own projections, the austerity package designed by the troika promises a decade of austerity, with high unemployment, falling real wages and sharp reductions in public services and pensions. And, their projections have consistently proven to be overly optimistic.
If given the opportunity would the Greek people endorse this sort of austerity package? The answer obviously depends on the alternative.
The alternative route almost certainly means a disorderly debt default and a departure from the euro. That is not a pretty picture. If Greece follows the path of Argentina, the last country to make a similar break, then the economy is likely to undergo a free fall for a period of time. The duration of this free fall will depend on how long it takes the government to get a new currency in use and construct some provisional formula for converting euro-denominated contracts into the new currency.
In Argentina this period was three months, with another three months of stagnation before the economy began a sustained boom. The process could be more difficult in Greece, both because it is tied in more extensively to the eurozone countries and also because Argentina at least had its own currency.
However, even in the case of Greece, such a break would not be impossible. There will be a desire to hold the new currency. The government just has to impose a new property tax that is only payable in the new currency.
People will want to hold onto ocean-front property in the Greek islands or at the foot of the Acropolis, so there will be demand for the currency. Also, the prospect of a tourist boom, once prices in Greece fall by 50 percent relative to Italy, Spain, and other popular destinations will go a long way toward supporting the Greek economy.
If the Greek people can convince themselves of a plausible alternative then they could make a few demands on the troika. First, they could say that 10 years of continuous austerity is not acceptable.
Yes, the Greeks had been reckless borrowers, but the European banks had also been reckless lenders. It is true that the Greek government had lied about its budget situation. However, the word among finance types is that everyone knew they were lying and went along with the joke. Goldman Sachs even designed a nifty swap that allowed it to profit from the lies.
Instead of austerity, the Greek people might insist that the ECB focus on a growth agenda. This would mean that the ECB would have to ditch its obsession with a 2 percent inflation target and start acting like a real central bank. The ECB could start by guaranteeing the debt of Italy and Spain, both of which risk a rising interest rate-default death spiral if there is not a credible guarantee behind their debt.
It might also start pushing more expansionary policies. It’s always hard to admit when you are wrong, but the ECB-IMF policy of growth through austerity is not working. Every month we get more proof of this fact with data showing that growth is lower than expected and unemployment is higher than expected. Is there any evidence that could get these people to change their minds before they destroy Europe’s economy? Maybe the Greek people could have forced the troika to actually look at the data.
There would have been other potential for fun in these negotiations. The Greek people, who have already been forced to accept a rise in their retirement age and lower pensions, may suggest the same for IMF economists. These hard-working types can often retire from their jobs in their early 50s. Instead of the meager Greek pensions of a few hundred euros a month that got the banker types so riled, the IMF crew can be pocketing close to $10,000 a month in their pensions. Maybe IMF pensions would have come up for debate if the Greek people actually had to be convinced that a bailout was in their own good.
But the chance to bring the Greek people into the discussion was quickly nixed. We are back to a conversation among the bankers and the politicians. There is not much room for democracy in this story, but we can still dream.
Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of False Profits: Recovering from the Bubble Economy . He also has a blog, ” Beat the Press ,” where he discusses the media’s coverage of economic issues.
This article was originally published by The Guardian.
