Wednesday READ – 13 November 2013
Posted by greydogg, 99GetSmart
* IT’S BUSINESS THAT REALLY RULES US NOW
Lobbying is the least of it: corporate interests have captured the entire democratic process. No wonder so many have given up on politics
By George Monbiot, The Guardian
It’s the reason for the collapse of democratic choice. It’s the source of our growing disillusionment with politics. It’s the great unmentionable. Corporate power. The media will scarcely whisper its name. It is howlingly absent from parliamentary debates. Until we name it and confront it, politics is a waste of time.
The political role of business corporations is generally interpreted as that of lobbyists, seeking to influence government policy. In reality they belong on the inside. They are part of the nexus of power that creates policy. They face no significant resistance, from either government or opposition, as their interests have now been woven into the fabric of all three main political parties in Britain.
Most of the scandals that leave people in despair about politics arise from this source. On Monday, for instance, the Guardian revealed that the government’s subsidy system for gas-burning power stations is being designed by an executive from the Dublin-based company ESB International, who has been seconded into the Department of Energy. What does ESB do? Oh, it builds gas-burning power stations.
On the same day we learned that a government minister, Nick Boles, has privately assured the gambling company Ladbrokes that it needn’t worry about attempts by local authorities to stop the spread of betting shops. His new law will prevent councils from taking action. […]
* BANKOCRACY: FROM THE VENETIAN REPUBLIC TO MARIO DRAGHI AND GOLDMAN SACHS
By Eric Toussaint, CADTM
From the 12th century to the beginning of the 14th, the Knights Templar, present in much of Europe, had become the bankers for the powerful and had taken part in the financing of several crusades. At the beginning of the 14th century, they were the main creditors of the King of France, Philip the Fair. Faced with a debt burden that was straining his resources, Philip the Fair eliminated both his creditors and his debt by demonising the Knights Templar, accusing them of many crimes |1|. Their Order was outlawed, the leaders executed and its assets seized. Its army (fifteen thousand men, including one thousand five hundred knights), its patrimony and its credits to rulers failed to protect it from the power of a State set on eliminating its main creditor.
During the same era (11th – 14th centuries) Venetian bankers were also financing the Crusades and lending money to the powerful of Europe, but they manoeuvred much more deftly than the Knights Templar. In Venice, they took control of the State by founding the Venetian Republic. They financed the transformation of the Venetian city-state into a veritable empire including Cyprus, Euboea (Negroponte) and Crete. They made use of a clever strategy to gain lasting wealth and guarantee reimbursement of their credits: they decided to drive the Venetian state into debt towards the banks they owned. They were the ones who set the terms of the loan contracts, as they were at once bank owners and rulers of the State.
While Philip the Fair had an interest in physically ridding himself of his creditors to be free from the debt burden, the Venetian State reimbursed the debt to bankers in cash. The latter came up with the idea of creating public debt titles that could circulate between banks. This was a step towards the establishment of financial markets |2|. This type of loan is the precursor to the major form of State debt as we know it in the 21st century.
Today, seven centuries after Philip the Fair crushed the Knights Templar, the bankers of Europe, just like their Venetian or Genovese forebears, clearly have nothing to fear from governments. […]
* PONZI AUSTERITY: A DEFINITION AND AN EXAMPLE
By Yanis Varoufakis, yanisvaroufakis.eu
For a while now I have been arguing that Europe’s policies for reducing the public debts of fiscally stressed member-states can be described as a Ponzi austerity scheme. In this post I attempt precisely to define ‘Ponzi austerity’.
Standard Ponzi schemes are based on a sleight of hand that creates the appearance of a fund whose value grows faster than the value that has come into it. In reality the opposite is true, as the scheme’s operator usually helps himself to some of the incoming capital while the scheme is not managing to create new capital with which to replenish these ‘leakages’, let alone pay the returns it promises. The appearances of growth that does not really exist is, of course, the lure that brings into the scheme new participants whose capital is utilised by the Ponzi scheme’s operator to maintain the facade of genuine growth.
Ponzi austerity is the inverse of Ponzi growth. Whereas in standard Ponzi (growth) schemes the lure is the promise of a growing fund, in the case of Ponzi austerity the attraction to bankrupted participants is the promise of reducing their debt, so as to liberate them from insolvency, through a combination of ‘belt tightening’, austerity measures and new loans that provide the bankrupt with necessary funds for repaying maturing debts (e.g. bonds). As it is impossible to escape insolvency in this manner, Ponzi austerity schemes, just like Ponzi growth schemes, necessitate a constant influx of new capital to support the illusion that bankruptcy has been averted. But to attract this capital, the Ponzi austerity’s operators must do their utmost to maintain the façade of genuine debt reduction.
Ponzi austerity’s inventor: The Eurozone’s great and good
Ponzi growth has been around for yonks. But it took the collective wisdom of Europe’s great and good to create the first Ponzi austerity scheme. The Greek, Portuguese, Irish, Spanish and Cypriot loan agreements were the first ever examples of such a scheme. Bankrupted states, in a death embrace with bankrupted banking sectors, were forced to take in ever-increasing capital inflows (from the IMF, from the ECB, from the EFSF-ESM, shortly under the ECB’s OMT threat) on condition of belt-tightening austerity. As the scheme progresses, more capital is coming into it, debt-to-GDP ratios actually grow (just as in Ponzi growth schemes the value of the total fund is depleted) and, therefore, even more outside capital has to be brought in in order to maintain the pretense. […]
* A FULL-FRONTAL ASSAULT ON DEMOCRACY IN EUROPE AND THE UNITED STATES
We are in the dark about treaty that would let rapacious companies subvert our laws, rights and national sovereignty.
By George Monbiot, The Guardian
Remember that referendum about whether we should create a single market with the United States? You know, the one that asked whether corporations should have the power to strike down our laws? No, I don’t either. Mind you, I spent 10 minutes looking for my watch the other day before I realised I was wearing it. Forgetting about the referendum is another sign of ageing. Because there must have been one, mustn’t there? After all that agonising over whether or not we should stay in the European Union, the government wouldn’t cede our sovereignty to some shadowy, undemocratic body without consulting us. Would it?
The purpose of the Transatlantic Trade and Investment Partnership is to remove the regulatory differences between the US and European nations. I mentioned it a couple of weeks ago. But I left out the most important issue: the remarkable ability it would grant big business to sue the living daylights out of governments which try to defend their citizens. It would allow a secretive panel of corporate lawyers to overrule the will of parliament and destroy our legal protections. Yet the defenders of our sovereignty say nothing.
The mechanism through which this is achieved is known as investor-state dispute settlement. It’s already being used in many parts of the world to kill regulations protecting people and the living planet. […]
* ENOUGHNESS: RESTORING BALANCE TO THE ECONOMY
How we see the world determines how we act. Western thought sees us at war with each other over resources. Indigenous philosophy, we are all related as individuals in balance with nature. Watch ENOUGHNESS: Resorting Balance to the Economy and learn more at www.FirstPeoples.org. Share on Facebook and Twitter using #ENOUGHNESS.
* HOW ECONOMIC GROWTH HAS BECOME ANTI-LIFE
An obsession with growth has eclipsed our concern for sustainability, justice and human dignity. But people are not disposable – the value of life lies outside economic development
By Vandana Shiva, CommonDreams
Limitless growth is the fantasy of economists, businesses and politicians. It is seen as a measure of progress. As a result, gross domestic product (GDP), which is supposed to measure the wealth of nations, has emerged as both the most powerful number and dominant concept in our times. However, economic growth hides the poverty it creates through the destruction of nature, which in turn leads to communities lacking the capacity to provide for themselves.
The concept of growth was put forward as a measure to mobilise resources during the second world war. GDP is based on creating an artificial and fictitious boundary, assuming that if you produce what you consume, you do not produce. In effect , “growth” measures the conversion of nature into cash, and commons into commodities.
Thus nature’s amazing cycles of renewal of water and nutrients are defined into nonproduction. The peasants of the world,who provide 72% of the food, do not produce; women who farm or do most of the housework do not fit this paradigm of growth either. A living forest does not contribute to growth, but when trees are cut down and sold as timber, we have growth. Healthy societies and communities do not contribute to growth, but disease creates growth through, for example, the sale of patented medicine.
Water available as a commons shared freely and protected by all provides for all. However, it does not create growth. But when Coca-Cola sets up a plant, mines the water and fills plastic bottles with it, the economy grows. But this growth is based on creating poverty – both for nature and local communities. Water extracted beyond nature’s capacity to renew and recharge creates a water famine. Women are forced to walk longer distances looking for drinking water. In the village of Plachimada in Kerala, when the walk for water became 10 kms, local tribal woman Mayilamma said enough is enough. We cannot walk further; the Coca-Cola plant must shut down. The movement that the women started eventually led to the closure of the plant.
In the same vein, evolution has gifted us the seed. Farmers have selected, bred, and diversified it – it is the basis of food production. A seed that renews itself and multiplies produces seeds for the next season, as well as food. However, farmer-bred and farmer-saved seeds are not seen as contributing to growth. It creates and renews life, but it doesn’t lead to profits. Growth begins when seeds are modified, patented and genetically locked, leading to farmers being forced to buy more every season.
Nature is impoverished, biodiversity is eroded and a free, open resource is transformed into a patented commodity. Buying seeds every year is a recipe for debt for India’s poor peasants. And ever since seed monopolies have been established, farmers debt has increased. More than 270,000 farmers caught in a debt trap in India have committed suicide since 1995. […]
Photo by PaulSteinJC released under a Creative Commons Share Alike license.