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Thread: Finance is Responsible for This Savage New Era. But It's Off the Electoral Agenda

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    Finance is Responsible for This Savage New Era. But It's Off the Electoral Agenda

    The economic future will be painful, yet the public and their leaders show no appetite for wrestling the financial leviathan responsible

    This election campaign has felt rather like Christmas charades. Quite entertaining, the odd surprise – a distant cousin turns out to have unexpected talents – the uncle's bad-tempered moment that led to embarrassment all round, and a lot of guessing for a rather opaque conclusion.

    But an air of strange unreality hangs over the whole thing. Because while the British have been fascinated by "Bigotgate" and what it does or doesn't say about the most over-scrutinised character in the history of Downing Street, another chunk of the global economy has been teetering on the edge of collapse – just 18 months after the last crisis brought the world banking system within hours of disintegration. Even those expressly charged with keeping themselves, and hence the markets, calm can't help reaching for lurid metaphor, as the head of the Organisation for Economic Co-operation and Development likened the spreading crisis in the eurozone to the most ferociously contagious and incurable of diseases – Ebola.

    We had one small question on bankers' bonuses in Thursday's economic debate and some halfhearted discussion of banking reform before moving on to a subject that arouses far more passion – immigration. Bankers' bonuses are the very least of it – the relatively insignificant tip of an iceberg – a radical restructuring is urgently necessary, argues Better Banking, the New Economics Foundation's manifesto published last week in a bid to try to get this issue on to the agenda. But the conclusion is clear; there is no great anger or appetite in the British public or their leaders for a wrestling with the leviathan financial system which is sucking the lifeblood from our political economy. That time may come but right now, all that everyone wants is for everything to go back to the way it was in 2007: booming property prices, rising debt levels. Faced with an irritating problem of dry rot, the homeowner is resolving just to patch up the visible bits and pretend the rafters are not crumbling and the ceiling is not going to fall in.

    If you think that is a bit of hyperbole, read the Financial Times's Martin Wolf on the "financial doomsday machine", or the head of the Financial Services Authority Adair Turner's thoughtful speech in March, when he concluded: "We need to challenge radically some of the assumptions of the last 30 years", which have been "deep-rooted drivers of financial instability". Wolf is no leftie, but he declared recently that "a large part of the activity of the financial sector seems to be a machine to transfer income and wealth from outsiders to insiders while increasing the fragility of the economy as a whole". Just in case you were wondering who the outsiders are, it's you and me – our pensions, our savings, our mortgages, feeding this bloodsucker.

    You might have thought that the treatment meted out to Greece, Portugal and Spain in the bond markets would have prompted more questions about how the financial system works. All the more so since this is the nightmare scenario that George Osborne has been dangling in front of the electorate. Who are these credit ratings agencies who are plunging the continent into crisis?

    But no, the irony is that while we are immersed in an electoral process which is all about bringing those in power to account, the unaccountable financial system that is responsible for the painful years which lie ahead – of unprecedented cuts and the political conflict that will result – goes largely unchallenged. Politicians are left ignominiously to beg or reproach these credit ratings agencies – as both Portugal and Brussels did last week. (Agencies now described by economist Paul Krugman as "deeply corrupt", still wielding huge power despite a track record on Enron and sub-prime which has revealed an appalling lack of judgment.)

    You might have thought that the spellbinding moment of Goldman Sachs executives fumbling through their files to find answers in the US Senate hearings might have prompted more outrage at the duplicity and self-serving corruption entrenched in the financial system. As Turner admitted a year ago, "British citizens will be burdened for many years with either higher taxes or cuts in public services – because of an economic crisis ... cooked up in trading rooms where ... many people earned annual bonuses equal to a lifetime's earnings of some of those now suffering the consequences."

    The gross injustice of it is one reason for anger, but there is another, even more important. David Harvey, author of The Enigma of Capital, was in the UK last week on a timely promotional tour; his central thesis is that capitalism is inherently crisis-ridden, and that its crises mutate rapidly. Eighteen months ago we had a debt crisis of the financial sector, now we have a public sector debt crisis spreading across Europe. That has prompted a political crisis across the eurozone, and particularly in Germany and Greece; voters in the former are incandescent about lending their money, while in the latter it is rapidly becoming a crisis of the state itself as the unions declare a general strike for this Wednesday, and protesters had to be dispersed with teargas over the weekend. Average Greek incomes have dropped 20% with low- and middle-income earners worst affected.

    The political fallout of crisis-ridden capitalism in the 1930s was precisely what politicians and policymakers wanted to prevent as they constructed the postwar Bretton Woods financial system: slow and steady were its primary requirements, and between 1945 and the mid-70s it led to better average levels of growth than the boom and bust cycles of the more volatile decades which followed. The great poison of lightly regulated capitalism is as much about volatility as it is about inequality; it is so destructive of the social fabric, ratcheting up unemployment, destroying neighbourhoods, provoking tensions which feed into political extremism and violence.

    But for the last 30 years such insights were marginalised by efficient market theory which argued that left to themselves, markets were self-equilibrating and stable. This was pure fantasy, yet it seduced politicians and electorates, who got the illusion of economic growth they needed, while the fantasy generated millions which poured into the pockets of an elite.

    Curiously, the one group who really understood the fantasy were those who were peddling it. The US Senate investigation into credit ratings agencies has just released a mountain of documents which reveal a mind-boggling insouciance. One internal email at Standard & Poor's in December 2006 read: "Ratings agencies continue to create an even bigger monster – the CDO [collateralised debt obligation] market. Let's hope we are all wealthy and retired by the time this house of cards falters." And indeed many of them are; profitability at the agencies soared in the early years of this decade.

    This election is a kind of lull before the storm. While excited discussions consider the potential for electoral reform, the real story of the next few years will be the savage dismantling of social democracy and a new era of industrial strife organised via Twitter. Then there will be plenty of public anger, but the bankers and financial analysts will have got what they wanted – wealthy retirements and fortunes salted away in the country homes from which they survey the wreckage.

  2. #2
    Liberal party Peeress, Baroness Tonge said that the Conservatives and Labour where owned by the Jewish bankers, and that she wouldnt be suprised if her own party was also.

    This non mention of the worst problem facing Britain today proves to me the Liberals are the third Banking party.

    The papers recently revealed the bankers gave themselves a 6.8 billion pound bonus, that is money that has been taken from the British taxpayer and given directly to the bankers.
    Now if Nick Clegg had brought this to the publics attention, and said he was going to demand that stolen money paid back, there would be no hung parliament, Liberals would win outright, but as the article mentions, its not mentioned, because they are all three working for Babylon the Great, the Satanic worshipping Jews who have a kingdom over the kings of the Earth.

    The only party manifesto I read that wants the banks in Britains own hands is the National Front, called by many a Nazi party, just like the Nazis who where demonised for taking control of thier won money.

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    For most of us not too much new things, but still interesting to read how this issue reaches the mainstream, slowly but steadily, at least for those who care, while the rest being still distracted with "soft political issues" and can't comprehend whats really happening in this time of change.

    The rating agencies will be probably eliminated afterwards, probably even becoming the scapegoats while those behind the scene, just using those agencies as a mean, pulling the strings, will get away and even strengthen their position if no radical political change which challenges the Plutocratic Oligarchy will become reality.

    Quote Originally Posted by Ralf Rossa View Post
    Liberal party Peeress, Baroness Tonge said that the Conservatives and Labour where owned by the Jewish bankers, and that she wouldnt be suprised if her own party was also.
    Well, Liberals will be hardly a solution to anything if looking at we face, but still such people could be helpful to create some sort of awareness, like the Cultural Marxists made it all the time.

    Do you have a source for her quote?
    Magna Europa est patria nostra

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