Despite a growing consensus that speculators are behind recent price increases, the government’s almost year-old oil speculation task force has done little more than talk about the problem. From the beginning of January to the end of February, the average retail price per gallon of gasoline jumped 42 cents from $3.30 to $3.72–a spike of 12.7% in just eight weeks. This year’s pain at the pump is eerily similar to last year’s, when gas prices jumped 77 cents from $3.19 to $3.96 in just eleven weeks between February 21 and May 9–a leap of 24.1%.
In response to last year’s problem, in April 2011, President Obama and Attorney General Eric Holder announced the creation of the Oil and Gas Price Fraud Working Group, which was supposed to root out speculators who buy and sell oil futures based on the predicted price of oil. The trouble is, oil industry experts now estimate that financial speculators account for about 65% of the trading in oil futures contracts, up from 30% historically, leading many to conclude that the reversed ratio explains the high and volatile oil and gasoline prices. One analysis estimated that as much as 30% of the current price can be attributed to speculation. While the task force, which has met only four or five times, has been assisting a Federal Trade Commission investigation into gas prices since June 2011, a key problem is that most price speculation is legal, unless a trader relies on insider information or commits fraud, both of which can be difficult to prove.
Nevertheless, the fact that the U.S. today is producing more of its own oil than it has in years, and supply is actually outstripping demand, has many demanding action on gasoline prices. This year, however, the President is emphasizing his proposal to eliminate tax breaks that net the oil companies about $4 billion per year. Given the lack of success of the oil speculation task force, those tax breaks are probably safe for now.
To Learn More:
Whatever Happened to Task Force on Oil Speculation? (by Kevin G. Hall, McClatchy Newspapers)
U.S. Use of Gasoline is Down, Yet Pump Prices are Up as Speculators Move In (by Noel Brinkerhoff and David Wallechinsky, AllGov)
Gas Prices Up, but so Are Profits and Exports as Refiners Hold Back Production (by Noel Brinkerhoff, AllGov)
March 5, 2012
Posted by aletho |
Economics, Malthusian Ideology, Phony Scarcity, Progressive Hypocrite | Eric Holder, Federal Trade Commission, Oil Prices, Petroleum industry |
Leave a comment
Sanctions, Threats and Speculators
It’s hard to miss the higher cost of gas every time we fill up our cars these days, but the News Media doesn’t do a very good job of explaining why. There isn’t any mystery, though, if you read the financial press and oil industry sources: We’re paying extra for gas because of rising tensions in the Middle East and especially the scare over a possible US or Israeli attack on Iran. In effect, we’re paying a “war tax” at the gas pump, and the cost will only get higher unless we put aside the talk of war and get down to serious diplomacy to settle the differences in the region.
Here’s what the Wall Street Journal had to say recently, under the headline Oil Rise Imperils Budding Recovery:
Rising oil prices are emerging once again as a threat to the U.S. economic recovery just as it appears to be gaining momentum. Oil prices have climbed sharply in recent weeks as mounting tension with Iran has raised the threat of a disruption in global supplies. On Wednesday, oil futures on the New York Mercantile Exchange rose $1.06 to $101.80 a barrel on reports that Iran had cut off sales to six European countries in response to the European Union’s newly stepped-up sanctions.
The world market price for oil is headed upward of $110 a barrel, which could translate into $4 gasoline before too long. If an actual war breaks out, we could soon be remembering the current price at the pump as “cheap gas”.
But what about “Drill Baby Drill” to lower the price of gas – as the Republicans demand? Political rhetoric aside, the reality is that there is a world market price for petroleum which cannot be significantly lowered by marginal increases in US supply. International oil prices are rising even as US oil production has increased during the past decade. Do you think US suppliers are going to sell us domestically-produced oil at a discount lower than the world market price? Keep dreaming. That’s just not the way the oil companies do business.
For example, after the US Arctic oil fields were developed and the TransAlaska pipeline came into service – despite serious environmental objections – large amounts of Alaskan oil were exported rather than sold in the lower 48 states. Between 1996 and 2004 almost a 100 million barrels of Alaska crude were shipped to Japan, Taiwan, Korea and China. Direct export of North Slope oil was eventually banned by Congress, but refined petroleum products – gasoline, heating oil, jet fuel – continue to be shipped abroad from refineries in Alaska and the lower 48. Today Gulf Coast refineries find it more profitable to sell gasoline to Latin America instead of shipping it to the East Coast, where the law would require them to use US-flagged tankers with American crews. The US is now a net exporter of refined petroleum products, even as the rising price of gas continues to put a strain on struggling families with no alternative means of transportation.
But an even higher war tax on gas is not inevitable. Diplomacy with Iran could still diffuse the conflict before the unthinkable happens. Despite all the alarmist and warmongering rhetoric, especially from Republican presidential candidates, we are not facing an imminent nuclear threat from Iran. US intelligence agencies are unanimous in judging that Iran does not have an active nuclear weapons program at this time. In fact, the Iranians – like all the other countries in the Middle East except Israel – have signed the Nuclear Non-Proliferation Treaty and they have the right under its safeguards to produce low-enriched uranium for power plants and medical research. All of Iran’s nuclear materials are under real-time inspection by the International Atomic Energy Agency. The only nuclear weapons in the Middle East right now are the hundreds of warheads belonging to the US and Israel.
Despite this reality – and in the face of opinion polls showing Americans prefer a diplomatic solution to the Iran issue rather than a military conflict – some politicians seem determined to drive us into yet another Middle East war. Ironically, the very same politicians who are trying to make a partisan issue out of the price of gas are the ones who are pressing for policies to sharpen the regional tensions that have caused them to rise.
After the bitter experience of Iraq and Afghanistan, we should have learned enough to demand a peaceful way out of this conflict. If we fail, a new war could have unpredictable and catastrophic results throughout the region. Of course, in that case, $5 gas might be the least of our problems.
Jeff Klein is a retired local union president active with Dorchester People for Peace (info@dotpeace.org)
March 2, 2012
Posted by aletho |
Economics, Militarism | Iran, Oil Prices |
Leave a comment
How inert can the Democratic Party be? Do they really want to defeat the Congressional Republicans in the fall by doing the right thing?
A winning issue is to raise the federal minimum wage, stuck at $7.25 since 2007. If it was adjusted for inflation since 1968, not to mention other erosions of wage levels, the federal minimum would be around $10.
Here are some arguments for raising the minimum wage this year to catch up with 1968 when worker productivity was half of what it is today.
1. Pure fairness for millions of hard-pressed American workers and their families. Over 70 percent of Americans in national polls support a minimum wage that keeps up with inflation.
2. Already eighteen states have enacted higher minimum wages led by Washington state to $9.04 an hour. With the support of Mayor Michael Bloomberg and State Assembly Speaker Sheldon Silver, the New York State legislature is considering a bill to raise the state’s minimum wage. The legislature should pass the long-blocked farm workers wage bill at the same time.
3. Since at least 1968, businesses and their executives have been raising prices and their salaries (note: Walmart’s CEO making over $11,000 an hour!) while they have been getting a profitable windfall from their struggling workers, whose federal minimum is $2.75 lower in purchasing power than it was 44 years ago.
4. The tens of billions of dollars that a $10 minimum will provide to consumers’ buying power will create more sales and more jobs. Aren’t economists all saying the most important way out of the recession and the investment stall is to increase consumer spending?
5. Most independent studies collected by the Economic Policy Institute show no decrease in employment following a minimum wage increase. Most studies show job numbers overall go up. The landmark study rebutting claims of lost jobs was conducted by Professors David Card and Alan Krueger in 1994. Professor Krueger is now chairman of President Obama’s Council of Economic Advisers.
6. Many organizations with millions of members are on the record favoring an inflation-adjusted increase in the federal minimum wage. They include the AFL-CIO and member unions, the NAACP and La Raza, and hundreds of non-profit social service and religious organizations. They need to move from being on the record to being on the ramparts.
7. With many Republicans supporting a higher minimum wage and with Mitt Romney and Rick Santorum on their side, a push in Congress will split the iron unity of the Republicans under Senator Mitch McConnell and Speaker John Boehner and gain some Republican lawmakers for passage. This issue may also encourage some Republican voters to vote for Democrats this fall. A Republican worker in McDonalds or Walmart or a cleaning company still wants a living wage.
8. President Barack Obama declared in 2008 that he wanted a $9.50 federal minimum by year 2011. If lip-service is the first step toward action, he is on board too. There is no better time to enact a higher minimum wage than during an election year. Against millions of dollars in opposition ads in Florida in 2004, over 70 percent of the voters in a statewide referendum went for a minimum wage promoted by a penniless coalition of citizen groups.
9. The Occupy movement can supply the continuing civic jolts around the local offices of 535 members of Congress, a slim majority of whom are not opposed to raising the minimum wage but who need that high profile pressure back home. Winning this issue will give the Occupy activists many new recruits, and much more power for getting something done in an otherwise do-nothing or obstructionist corporate indentured Congress. About 80 percent of the workers affected by a minimum wage increase are over 20 years of age.
Remember there is no need to offset a higher minimum wage with lower taxes on small business. Since Obama took office there have already been 17 tax cuts for small business and no increase in the federal minimum wage.
At the University of Virginia, twelve students have begun a hunger strike to protest the low wages and other injustices inflicted on contract service-sector employees. Students at other universities are likely to follow with their Living Wage Campaigns in this American Spring. They are fed up with millions of dollars for top administrators’ salaries or amenities such as fancy practice facilities for athletes, while the blue collar workers can’t pay for the necessities of life.
Raising the federal wage to 1968 levels, inflation adjusted, is a winning issue. It just needs a few million Americans to rouse themselves for a few months as they do for their favorite sports team and connect with all those large concurring organizations and their powerful legislators, like Senate majority leader Harry Reid, a big supporter, to start the rumble that will make it a reality.
If you are interested in more information on the efforts to raise the minimum wage, send an email to info@nader.org.
February 29, 2012
Posted by aletho |
Economics, Progressive Hypocrite | Minimum wage, Ralph Nader |
Leave a comment
Israeli military officials say the Tel Aviv regime plans to sign a major arms deal worth USD 1.6 billion with Azerbaijan.
The officials said on Sunday Israel Aerospace Industries will sell “drones, anti-aircraft and missile defense systems worth USD 1.6 billion” to Azerbaijan.
Meanwhile, Israeli media said Angolan Finance Minister Carlos Alberto Lopes has traveled to Israel to sign a military agreement.
Reports say the Israeli-Angolan deal is worth about USD one billion.
The latest report on the Israeli military agreements comes a couple of days after Israeli officials said on February 16 the Tel Aviv regime had reached a “USD one billion preliminary” agreement with Italy to buy 30 Italian military training jets.
February 26, 2012
Posted by aletho |
Economics, Militarism | Azerbaijan, Israel, Israel Aerospace Industries, Italy, Press TV |
Leave a comment
Italian Prime Minister Mario Monti says complying with the European Union sanctions against Iran will cause many problems for the country’s ailing economy.
Speaking to reporters in a joint press conference with the president of the European Parliament, Martin Shulz, in Rome, Monti noted that Italy is grappling with serious economic recession and crisis and cutting Iran oil imports will cause the country to suffer more than other EU members.
The Italian premier added that due to heavy dependence on energy, Italy feels the pinch of Iran oil sanctions more than other European countries, but Rome is unable to disobey certain decisions.
Meanwhile, the Italian official news agency, ANSA, published a report quoting energy experts as saying that sanctions against Iran are useless and will only harm Italian and other European companies.
Referring to high trade volume between Tehran and Rome, the report added that given the existing economic crisis in Europe, compliance with sanctions may be an end to the longstanding presence of Italian companies in Iran, which will be replaced with Turkish and Chinese companies.
ANSA further stated that complying with Iran sanctions will also cost Italians 30,000 jobs.
On January 23, EU Foreign Ministers met in Belgium to approve new sanctions against Iran aimed at banning member countries from importing Iranian crude oil and carrying out transactions with its central bank.
The EU has considered a period of six months before sanctions are fully enforced in order to allow member states to adapt to new conditions and find new sources of crude oil.
EU decision followed imposition of similar sanctions by Washington on Iranian energy and financial sectors on the New Year’s Eve which seek to penalize other countries for buying Iran oil or dealing with the its central bank.
After approving new sanctions, EU foreign policy chief, Catherine Ashton, told reporters that the sanctions aim to persuade Tehran to suspend its peaceful nuclear activities and get back to negotiating table with P5+1 — comprising US, UK, France, Russia, China, and Germany.
The United States, Israel and some of their allies accuse Tehran of pursuing military objectives in its nuclear program, using this pretext to impose sanctions against Iran and threaten the country with military attack.
Iran has refuted the allegations, arguing that as a committed signatory to the nuclear Non-Proliferation Treaty and member of IAEA, it has the right to use nuclear technology for peaceful use.
The IAEA has never found any evidence indicating that Tehran’s civilian nuclear program has been diverted towards nuclear weapons production.
February 25, 2012
Posted by aletho |
Economics, Wars for Israel | European Union, Mario Monti, Sanctions against Iran, U.S. sanctions against Iran |
Leave a comment
France has dispatched riot forces to the Indian Ocean island of Reunion to beef up its security following violent protests against the high costs of living on the island.
Protests broke out in Reunion on Tuesday after truckers staged rallies against the rise of gas prices. However, they were later joined by many more protesters, infuriated over the high costs of living in general.
Almost a third of the residents of the French island of Reunion are unemployed and over half are struggling in poverty.
Three days of clashes between the protesters and the riot police left at least nine police officers injured and several shops and public buildings damaged. At least 76 protesters were also arrested during the clashes.
On Thursday night, the clashes were slightly less violent than previous nights in the capital Saint Denis, but unrest had spread to other cities around the island.
French Interior Minister Claude Gueant on Friday denounced the violence as “absolutely unacceptable.”
February 25, 2012
Posted by aletho |
Economics | France, Reunion, Saint Denis |
Leave a comment
There are few crimes more despicable than stealing your neighbour’s water, and polluting what’s left, then watching him and his children suffer thirst, disease and ruin. Most of us would want nothing to do with the perpetrators of such evil.
British Water describes itself as the voice of the water industry. It talks about best practice and corporate responsibility, and lobbies governments and regulators on behalf of its members. No doubt it does a good job. It also has international ambitions including in the Middle East. So presumably it knows what’s going on water-wise in the Holy Land.
British Water should know, for example, that the 400-mile long structure known worldwide as Israel’s Apartheid Wall bites deep into the Palestinian West Bank dividing and isolating communities and stealing their lands and water.
If the wall was simply for security, as Israel claims, it would have been built along the internationally-recognised 1949 Armistice Green Line, although not even this is an official border. The wall’s purpose is plainly to annex plum Palestinian land and water resources for illegal Israeli settlements, and to that end it closely follows the line of the Western Aquifer.
In 2004 the International Court of Justice at The Hague ruled that the construction of the wall is “contrary to international law” and Israel must dismantle it and make reparation for damage caused. The ICJ also ruled that “all states are under an obligation not to recognise the illegal situation resulting from the construction of the wall and not to render aid or assistance in maintaining the situation created by such construction”.
But the wall marches on, aided by American tax dollars and America’s protective veto, so that Israel can wield complete control over the water resources it sees as necessary to the regime’s present and future needs. This makes the Palestinians, who sit on top of enough water to be self-sufficient, entirely dependent on Israel for God’s life-giver. Israel also consumes most of the water from the Jordan River despite only three per cent of the river falling within its pre-1967 borders. Palestinians now have no access to it whatsoever due to Israeli closures.
Most of the Coastal Aquifer, on which Gaza’s inhabitants rely for water, is contaminated by sewage and nitrates, and is unfit for human consumption. Children particularly are at great risk. The aquifer is depleted and in danger of collapse. The damage could take generations to reverse, say experts.
During Israel’s deadly assault on Gaza (Operation Cast Lead) in 2008-09 over 30km of water networks were damaged or destroyed in addition to 11 wells. A UN fact-finding mission (the Goldstone Report) considered the destruction “deliberate and systematic”. Proper repairs have been impossible these last three years because Israel blocks the import of spare parts.
“Thirsting for Justice” is an aptly-named campaign by the Emergency Water Sanitation and Hygiene group, a coalition of 30 Palestinian and European humanitarian organisations, including Oxfam. It calls on European governments to put pressure on Israel to respect international law and the Palestinians’ basic rights to water and sanitation.
Under the warped arrangements of the Interim Agreement on the West Bank and the Gaza Strip (1995) Palestinians are only allowed to extract 20 per cent of the “estimated potential” of the mountain aquifer beneath the West Bank. Israel not only takes the balance (80 per cent) but overdraws its sustainable yield often by more than 50 per cent. A Joint Water Committee was set up to implement the agreement but Israel was given veto power and the final say on decisions. As a result, a number of essential projects for Palestinians have been denied or delayed. To make up for part of the supply shortfall, Palestinians are forced to buy water from the Israeli national water company Mekorot, some of which is extracted from wells within the Palestinian West Bank. In other words they are having to buy their own water, and at inflated prices.
Oxfam, which is very active on the ground in Gaza, confirms that 90-95 per cent of water from Gaza’s only source, the Coastal Aquifer, is undrinkable. At the current rate the aquifer will be unusable by 2016 and the damage irreversible by 2020.
Gaza residents are restricted to an average of 91 litres of water per day compared to 280 litres used by Israelis. 100-150 litres a day are required to meet health needs, says the World Health Organisation. Marginalised Palestinian communities in the West Bank survive on less than 20 litres per capita per day, the minimum amount recommended by WHO to sustain life in an emergency.
Palestinians in Gaza and the West Bank are said to have full legal rights to nearly 750 million cubic metres of water but they have to make do with a trickle, or go without, while Israelis fill their swimming pools, sprinkle their lawns and wash their cars. In Bethlehem’s Aida refugee camp the water is turned off for days. When the street taps come on again, usually for a few hours, there’s a desperate scramble to refill domestic tanks and other containers before the next cut.
Haaretz last month reported the French parliament’s Foreign Affairs Committee findings on the geopolitical impact of water in confrontation zones like Israel-Palestine.
According to the report, water has become “a weapon serving the new apartheid. Some 450,000 Israeli settlers on the West Bank use more water than the 2.3 million Palestinians that live there. In times of drought, in contravention of international law, the [illegal] settlers get priority for water”.
Israel is waging a “water occupation” against the Palestinians, says the report accusing the Israelis of “systematically destroying wells that were dug by Palestinians on the West Bank” as well as deliberately bombing reservoirs in the Gaza Strip in 2008-09. Furthermore, “many water purification facilities planned by the Palestinian Water Ministry are being blocked by the Israeli administration.”
Head of the Palestinian Water Authority Shaddad Attili observed: “Palestinians need to be able to access and control our rightful share of water in accordance with international law. The Oslo Accords did not achieve this. Without water, and without ensuring Palestinian water rights, there can be no viable or sovereign Palestinian state.”
Not content with robbing the Palestinians of their water, the Israelis are in the habit of flooding Palestinian fields and villages with untreated sewage from their hilltop settlements.
Against this background British Water has decided to cooperate with MATIMOP, an Israeli government agency that has been ordered to enter into international agreements and “aggressively expand opportunities for Israel’s industry”.
Always eager to oblige, the UK Trade and Investment Department’s briefing on Environment Opportunities in Israel contains this advice: “Israeli companies are keen to form alliances with companies abroad, and this is where the UK can benefit. In addition, growing development and marketing costs compel Israeli environmental companies to seek cooperation with foreign partners. The UK are world leaders in many aspects of the environment and so the UK and Israel complement each other and have much to offer each other in this sector. Teaming up with Israeli environment companies will give UK companies access to innovation and entrepreneurial spirit. UK companies can also benefit by providing their experience in marketing and management for Israeli companies.”
British Water signed a Memorandum of Understanding with MATIMOP on 21 December, so close to the Christmas holidays that it went unnoticed here. The event was not even recorded on British Water’s website but it was proudly featured on the embassy of Israel site and treated by the Israeli press as a triumph. MATIMOP calls it “a strategic cooperation agreement”. Executive Director Israel Shamay said: “We are pleased to be working closer with British Water than we have worked with any foreign trade organisation before. The UK water sector is well respected internationally for its world-leading capabilities, solutions and services, making it the perfect partner to help commercialise and market Israeli innovation and R&D in this sector.”
British Water agreed the text for an announcement by the Embassy of Israel but didn’t release it themselves, apparently happy for Tel Aviv’s propaganda boys to take care of it. In the press release MATIMOP says: “Israel has been coping with water scarcity since its founding.” Yes, coping by thieving.
The Palestinians have been subjected to the longest and most brutal military occupation in modern times and are held prisoner within the fragmented remnants of their own country, unable to develop its resources or travel freely within it to find work, attend university, visit family, or worship at their holy places in Jerusalem. Is helping Israel to become a water superpower really the right thing for British Water to be doing?
British Water’s CEO David Neil-Gallacher was asked: “EU agreements require Israel to show “respect for human rights and democratic principles” and provide for the agreement to be suspended otherwise. Does the MATIMOP agreement include similar good behaviour conditions?”
His reply: “The agreement with MATIMOP is a Memorandum of Understanding. Both parties are professional organisations with admirable aims and objectives.”
Another question: “British Water will be aware that Israel illegally occupies its neighbour Palestine and has seized control of its water resources. The path of Israel’s 400-mile separation wall closely follows the line of the Western Aquifer and encloses key supplies. In 2004 the International Court of Justice ruled that the construction of the wall in the occupied territories, including East Jerusalem, is ‘contrary to international law’ and ‘all states are under an obligation not to recognise the illegal situation resulting from the construction of the wall and not to render aid or assistance in maintaining the situation created by such construction’. In the circumstances, should ethically-minded British companies allow themselves to become embroiled?”
Neil-Gallacher was unfazed: “I’m not sure what you mean by ’embroiled’ or ‘ethically-minded’. The aim of the MoU is for businesses to work together for the good of the global water industry. It’s no part of our role to exchange philosophical concepts with you. The arrangement with MATIMOP is one of commercial intent for the benefit of UK and Israeli companies.”
Finally, “is British Water being evenhanded in this Holy Land confrontation zone? Are you offering help to the Palestinian Water Authority? Have you responded positively to the sea-water desalination project for Gaza and other programmes for West Bank towns and villages?”
Neil-Gallacher: “We notify our member companies of potential commercial opportunities wherever they may arise, leaving them — as they’re best-qualified — to weigh the relative attractiveness of different markets.”
David Neil-Gallacher is also Director-General of Aqua Europa, which does the same sort of job on a Europe-wide basis. This was his parting shot:
“Regions of tension are bound to engender strong views and conflicting principles, and it’s usually notoriously difficult to discern unequivocal moral ascendancy on the part of any of those involved. In my dealings with our companies active in the region, however, I’ve never seen any evidence that they are lacking in principle or moral locus. British Water’s perspective has to be a commercial one. We do our best to conduct our activities in the best interests of our part of British industry and strictly within the requirements of the law.”
How will British Water avoid complicity with Israel’s endless oppression of the Palestinians and the deadly strife with its other neighbours in the region? Perhaps Neil-Gallacher should ask one of his own member companies, Veolia, what can happen if caught up in Israeli projects that violate international law. Veolia dumps Israeli waste on Palestinian land and is helping to build and run a tramway connecting Jerusalem with illegal Israeli settlements. The company must rue the day it crossed the line to fall foul of those nice folks at BDS — the Boycott-Divestment-Sanctions movement.
February 23, 2012
Posted by aletho |
Economics, Ethnic Cleansing, Racism, Zionism, Illegal Occupation, Solidarity and Activism, Subjugation - Torture, Timeless or most popular, War Crimes | Gaza, International Court of Justice, Israel-Palestine, West Bank |
Leave a comment
The bombing of an Israeli embassy car in Delhi threatens India’s diplomatic maneuvers between Israel and Iran, and has put India’s discreetly nurtured ties with Israel since 1992 through a severe test. Those who are attracted to Israel’s depiction of Iran as a terrorist threat to world peace would do well to read historian Mark Perry’s account, revealing that Israel is recruiting, and collaborating with, terrorist groups in a secret war with Iran. That low-level conflict is spreading. Israel’s latest reaction should be seen in the light of Perry’s revelations.
The Israeli government’s hasty and aggressive posture following the Delhi bombing has caused offense in the Indian capital. Officials in Delhi have made plain that India will not be recruited into the anti-Iran alliance under Israeli–U.S. pressure. India will not allow “Washington, the Jewish lobby and much of Europe to push the country into a corner” over Iran. How India conducts its ties with that country dating back to ancient times is its business. Furthermore, police investigations into the bombing cannot be rushed to suit external interests. The law of the land must take its course.
What particularly irked Indian officials was that immediately after the Delhi bomb (another device was defused by Georgian police in Tbilisi on the same day), Prime Minister Benjamin Netanyahu of Israel sought to upstage India’s police investigations into the incident. Netanyahu described the Iranian government as the world’s “largest terror exporter” and Hezbollah in Lebanon as Iran’s “protégé.” Foreign Minister Avigdor Lieberman went further saying, “We know exactly who is responsible for the attack and who planned it, and we’re not going to take it lying down.”
As if that was not enough. Israel’s Energy and Water Resources Minister Uri Landau intervened with his own comment, calling “India’s support for the Palestinians at the UN a mistake,” and that he intended to “persuade” the Indians to change their stand. And Israel reportedly asked India to help sponsor a resolution against Iran in the UN Security Council, of which India is an elected member at present.
A full-scale Israeli offensive to force a complete overhaul of Indian foreign policy was under way. In the unlikely scenario of it happening, such an event would be a geopolitical earthquake. India’s reliance on oil producers who are firmly in the U.S. camp would be dangerously high. There would be other consequences in the short run. An audacious attack by Israel on Iran, with or without U.S. support, could be nearer, and so would the prospects of a wider Middle East conflict. For these reasons, India now stands between the present and the worst case scenario.
Police investigations were only beginning in Delhi when Israeli ministers spoke with such shocking certainly––the worst kind of megaphone diplomacy. For those sitting in the Indian capital, certain inferences were difficult to avoid. India had recently announced that it would abide by the UN sanctions against Iran, but would not obey additional sanctions imposed by the United States and the European Union. India would continue to buy oil from Iran, and an Indian trade delegation would visit Tehran in coming weeks.
Delhi was by no means alone in asserting an independent stance. Other countries, too, have been resisting what they consider to be strong-arm tactics by the anti-Iran bloc of nations to force reluctant governments to toe the line. The United States, the European Union and Israel are far from happy about this.
That the affair threatened India’s massive trade with Iran, and could derail India’s capacity to formulate its foreign policy, was not lost in Delhi. A number of Indian politicians and senior officials made the government’s position clear. Commerce Minister Anand Sharma said that terrorism and trade were “separate issues,” and that business with Iran would continue. A former diplomat of India and now a leading commentator, M. K. Bhadrakumar, described the Israeli offensive as a “smear campaign” that “Tehran’s agents had been going about placing bombs in New Delhi, Tbilisi and Bangkok.”
Meanwhile, police investigations, and a visit by an Israeli Mossad team to Delhi, were continuing. Indian officials insisted that there was no “conclusive evidence” to link the attack to any particular group or country. And a senior police officer was categorical in saying that there was no link between the Delhi bomb and explosions that occurred in Bangkok the day after.
The Indians are normally too polite to engage in crude public diplomacy. But when ministers of a country of under 8 million, albeit advanced and heavily militarized, try to dictate policy to a nation of 1.2 billion people, it is perhaps too much for the Indian sensitivities.
I am on record as saying that, in the challenging 1990s decade when the Soviet Union collapsed, India was hasty and ill-advised to build a “flyover” to Israel, and from Israel straight on to the United States. Over the years, Israel’s multi-billion dollar sales of weapons based on American and Russian technologies, and intelligence sharing, have given India easy access to an arms bazaar. But there is a cost. India can be vulnerable to pressure, and has ignored its interests in the Muslim world. Simply put, successive Indian governments put too many eggs in the (Israeli–U.S.) basket.
Now that India asserts its strategic interests independent of the United States and Israel, with the other members of the group called BRICS (Brazil, Russia, India, China, South Africa), it faces a trial of strength. The outcome will depend on whether Delhi can establish its capacity to turn away from what look like instant gains, and promises for future, to secure its long-term interests that are essential for India’s place on the world stage.
February 21, 2012
Posted by aletho |
Economics, Militarism, Timeless or most popular, Wars for Israel | Benjamin Netanyahu, India, Iran, Israel |
Leave a comment
Iran’s Oil Ministry announced it has cut oil exports to British and French firms in line with the decision to end crude exports to six European states.
The move comes as Iranian Oil Minister Rostam Qasemi had earlier hinted at the possibility of Iran’s halting oil exports to certain European countries.
Iranian Oil Ministry Spokesman Alireza Nikzad-Rahbar said Sunday that Iran has no problem in exporting and selling crude oil to its customers.
“We have our own oil customers and replacements for these [British and French] companies have already been chosen and we will sell the crude oil to new customers instead of the British and French companies,” Nikzad-Rahbar pointed out.
European Union foreign ministers agreed to ban oil imports from Iran on January 23 and to freeze the assets of the Iranian Central Bank across the EU in a bid to pressure Iran over its nuclear program.
The sanctions will become fully effective on July 1, 2012, to give EU member states enough time to adjust to the new conditions and find alternative crude oil supplies.
Despite the widely publicized claims by the US, Israel and some of their European allies that Iran’s nuclear program may include a military aspect, Tehran insists its nuclear work is civilian in nature.
Iran argues that as a signatory to the nuclear Non-Proliferation Treaty (NPT) and a member of the International Atomic Energy Agency (IAEA), it has the right to develop and acquire nuclear technology for peaceful purposes.
The IAEA has conducted numerous inspections of Iran’s nuclear facilities but has never found any evidence indicating that Tehran’s civilian nuclear program has been diverted towards nuclear weapons production.
February 19, 2012
Posted by aletho |
Economics, Wars for Israel | European Union, Iran, Press TV |
Leave a comment
Introduction
From the Financial Times to the far left, tons of ink has been spilt writing about some variant of the “Crisis of Global Capitalism”. While writers differ in the causes, consequences and cures, according to their ideological lights, there is a common agreement that “the crisis” threatens to end the capitalist system as we know it.
There is no doubt that, between 2008-2009, the capitalist system in Europe and the United States suffered a severe shock that shook the foundations of its financial system and threatened to bankrupt its ‘leading sectors’.
However, I will argue the ‘crisis of capitalism’ was turned into a ‘crisis of labor’. Finance capital, the principle detonator of the crash and crisis, recovered, the capitalist class as a whole was strengthened, and most important of all, it utilized the political, social, ideological conditions created as a result of “the crises” to further consolidate their dominance and exploitation over the rest of society.
In other words, the ‘crisis of capital’ has been converted into a strategic advantage for furthering the most fundamental interests of capital: the enlargement of profits, the consolidation of capitalist rule, the greater concentration of ownership, the deepening of inequalities between capital and labor and the creation of huge reserves of labor to further augment their profits.
Furthermore, the notion of a homogeneous global crisis of capitalism overlooks profound differences in performance and conditions, between countries, classes, and age cohorts.
The Global Crisis Thesis: The Economic and Social Argument
The advocates of global crisis argue that beginning in 2007 and continuing to the present, the world capitalist system has collapsed and recovery is a mirage. They cite stagnation and continuing recession in North America and the Eurozone. They offer GDP data hovering between negative to zero growth. Their argument is backed by data citing double digit unemployment in both regions. They frequently correct the official data which understates the percentage unemployed by excluding part-time, long-term unemployed workers and others. The ‘crisis’ argument is strengthened by citing the millions of homeowners who have been evicted by the banks, the sharp increase in poverty and destitution accompanying job loses, wage reductions and the elimination or reduction of social services. “Crisis” is also associated with the massive increase in bankruptcies of mostly small and medium size businesses and regional banks.
The Global Crisis: The Loss of Legitimacy
Critics, especially in the financial press, write of a “legitimacy crisis of capitalism” citing polls showing substantial majorities questioning the injustices of the capitalist system, the vast and growing inequalities and the rigged rules by which banks exploit their size (“too big to fail”) to raid the Treasury at the expense of social programs.
In summary the advocates of the thesis of a “Global Crisis of Capitalism” make a strong case, demonstrating the profound and pervasive destructive effects of the capitalist system on the lives of the great majority of humanity.
The problem is that a ‘crisis of humanity’ (more specifically of salary and wage workers) is not the same as a crisis of the capitalist system. In fact as I shall argue below growing social adversity, declining income and employment has been a major factor facilitating the rapid and massive recovery of the profit margins of most large scale corporations.
Moreover, the thesis of a‘global’ crisis of capitalism amalgamates disparate economies, countries, classes and age cohorts with sharply divergent performances at different historical moments.
Global Crisis or Uneven and Unequal Development?
It is utterly foolish to argue for a “global crisis” when several of the major economies in the world economy did not suffer a major downturn and others recovered and expanded rapidly. China and India did not suffer even a recession. Even during the worst years of the Euro-US decline, the Asian giants grew on average about 8%. Latin America’s economies especially the major agro-mineral export countries (Brazil, Argentina, Chile, ) with diversified markets, especially in Asia, paused briefly (in 2009) before assuming moderate to rapid growth (between 3% to 7%) from 2010-2012.
By aggregating economic data from the Euro-zone as a whole, the advocates of global crisis overlooked the enormous disparities in performance within the zone. While Southern Europe wallows in a deep sustained depression, by any measure, from 2008 to the foreseeable future, German exports, in 2011, set a record of a trillion euros; its trade surplus reached 158 billion euros, after a 155 billion euro surplus in 2010. (BBC News, Feb. 8 2012).
While aggregate Eurozone unemployment reaches 10.4%, the internal differences defy any notion of a “general crisis”. Unemployment in Holland is 4.9%, Austria 4.1% and Germany 5.5% with employer claims of widespread skilled labor shortages in key growth sectors. On the other hand in exploited southern Europe unemployment runs to depression levels, Greece 21%, Spain 22.9%, Ireland 14.5%, and Portugal 13.6% (FT 1/19/12, p.7). In other words, “the crisis” does not adversely affect some economies, that in fact profit from their market dominance and techno-financial strength over dependent, debtor and backward economies. To speak of a ‘global crisis’ obscures the fundamental dominant and exploitative relations that facilitate ‘recovery’ and growth of the elite economies over and against their competitors and client states. In addition global crisis theorists wrongly amalgamated crisis ridden, financial-speculative economies (US, England) with dynamic productive export economies (Germany, China).
The second problem with the thesis of a “global crisis” is that it overlooks profound internal differences between age cohorts. In several European countries youth unemployment (16-25) runs between 30 to 50% (Spain 48.7%, Greece 47.2%, Slovakia 35.6%, Italy 31%, Portugal 30.8% and Ireland 29%) while in Germany, Austria and Holland youth unemployment runs to Germany 7.8%, Austria 8.2% and Netherlands 8.6% (FT 2/1/12, p2). These differences underlie the reason why there is not a ‘global youth movement’ of “indignant” and “occupiers”. Five-fold differences between unemployed youth is not conducive to ‘international’ solidarity. The concentration of high youth unemployment figures explains the uneven development of mass- street protests especially centered in Southern Europe. It also explains why the northern Euro-American “anti-globalization” movement is largely a lifeless forum which attracts academic pontification on the “global capitalist crises” and the impotence of the “Social Forums” are unable to attract millions of unemployed youth from Southern Europe. They are more attracted to direct action. Globalist theorists overlook the specific way in which the mass of unemployed young workers are exploited in their dependent debt ridden countries. They ignore the specific way they are ruled and repressed by center-left and rightist capitalist parties. The contrast is most evident in the winter of 2012. Greek workers are pressured to accept a 20% cut in minimum wages while in Germany workers are demanding a 6% increase.
If the ‘crisis’ of capitalism is manifested in specific regions, so too does it affect different age/racial sectors of the wage and salaried classes. The unemployment rates of youth to older workers varies enormously: in Italy it is 3.5/1, Greece 2.5/1, Portugal 2.3/1, Spain 2.1/1 and Belgium 2.9/1. In Germany it is 1.5/1 (FT 2/1/12). In other words because of the higher levels of unemployment among youth they have a greater propensity for direct action ‘against the system’; while older workers with higher levels of employment (and unemployment benefits) have shown a greater propensity to rely on the ballot box and engage in limited strikes over job and pay related issues. The vast concentration of unemployed among young workers means they form the ‘available core’ for sustained action; but it also means that they can only achieve limited unity of action with the older working class experiencing single digit unemployment.
However, it is also true that the great mass of unemployed youth provides a formidable weapon, in the hands of employers to threaten to replace employed older workers. Today, capitalists constantly resort to using the unemployed to lower wages and benefits and to intensify exploitation (dubbed to “increase productivity”) to increase profit margins. Far from being simply an indicator of ‘capitalist crises’, high levels of unemployment have served along with other factors to increase the rate of profit, accumulate income and widen income inequalities which augments the consumption of luxury goods for the capitalist class: the sales of luxury cars and watches are booming.
Class Crises: The Counter-Thesis
Contrary to the “global capitalist crisis” theorists, a substantial amount of data has surfaced which refutes its assumptions. A recent study reports “US corporate profits are higher as a share of gross domestic product than at any time since 1950” (FT 1/30/12). US companies cash balances have never been greater, thanks to intensified exploitation of workers, and a multi-tiered wage systems in which new hires work for a fraction of what older workers receive (thanks to agreements signed by ‘door mat’ labor bosses).
The “crisis of capitalism” ideologues have ignored the financial reports of the major US corporations. According to the General Motors 2011 report to its stockholders, they celebrated the greatest profit ever, turning a profit of $7.6 billion, surpassing the previous record of $6.7 billion in 1997. A large part of these profits results from the freezing of its underfunded US pension funds and extracting greater productivity from fewer workers-in other words intensified exploitation-and cutting hourly wages of new hires by half. (Earthlink News 2/16/12)
Moreover the increased importance of imperialist exploitation is evident as the share of US corporate profits extracted overseas keeps rising at the expense of employee income growth. In 2011, the US economy grew by 1.7%, but median wages fell by 2.7%. According to the financial press the profit margins of the S&P 500 leapt from 6% to 9% of the GDP in the past three years, a share last achieved three generations ago. At roughly a third, the foreign share of these profits has more than doubled since 2000 (FT 2/13/12 P9. If this is a “capitalist crisis” then who needs a capitalist boom ?
Surveys of top corporations reveal that US companies are holding 1.73 trillion in cash, “the fruits of record high profit margins” (FT 1/30/12 p.6). These record profit margins result from mass firings which have led to intensifying exploitation of the remaining workers. Also negligible federal interest rates and easy access to credit allow capitalists to exploit vast differentials between borrowing and lending and investing. Lower taxes and cuts in social programs result in a growing cash pile for corporations. Within the corporate structure, income goes to the top where senior executives pay themselves huge bonuses. Among the leading S&P 500 corporations the proportion of income that goes to dividends for stockholders is the lowest since 1900 (FT 1/30/12, p.6).
A real capitalist crisis would adversely affect profit margins, gross earnings and the accumulation of “cash piles”. Rising profits are being horded because as capitalists profit from intense exploitation, mass consumption stagnates.
Crisis theorists confuse what is clearly the degrading of labor, the savaging of living and working conditions and even the stagnation of the economy, with a ‘crisis’ of capital: when the capitalist class increases its profit margins, hoards trillions, it is not in crisis. The key point is that the ‘crisis of labor’ is a major stimulus for the recovery of capitalist profits. We cannot generalize from one to the other. No doubt there was a moment of capitalist crisis (2008-2009) but thanks to the capitalist state’s unprecedented massive transfer of wealth from the public treasury to the capitalist class – Wall Street banks in the first instance – the corporate sector recovered, while the workers and the rest of the economy remained in crises, went bankrupt and out of work.
From Crisis to Recovery of Profits: 2008/9 to 2012
The key to the ‘recovery’ of corporate profits had little to do with the business cycle and all to do with Wall Street’s large scale takeover and pillage of the US Treasury. Between 2009-2012 hundreds of former Wall Street executives, managers and investment advisers seized all the major decision-making positions in the Treasury Department and channeled trillions of dollars into leading financial and corporate coffers. They intervened in financially troubled corporations, like General Motors, imposing major wage cuts and dismissals of thousands of workers.
Wall Streeters in Treasury elaborated the doctrine of “Too Big to Fail” to justify the massive transfer of wealth. The entire speculative edifice built in part by a 234 fold rise in foreign exchange trading volume between 1977-2010 was restored (FT 1/10/12, p.7). The new doctrine argued that the state’s first and principle priority is to return the financial system to profitability at any and all cost to society, citizens, taxpayers and workers. “Too Big to Fail” is a complete repudiation of the most basic principle of the “free market” capitalist system: the idea that those capitalists who lose bear the consequences; that each investor or CEO, is responsible for their action. Financial capitalists no longer needed to justify their activity in terms of any contribution to the growth of the economy or “social utility”. According to the current rulers Wall Street must be saved because it is Wall Street, even if the rest of the economy and people sink (FT 1/20/12, p.11). State bailouts and financing are complemented by hundreds of billions in tax concessions, leading to unprecedented fiscal deficits and the growth of massive social inequalities. The pay of CEO’s as a multiple of the average worker went from 24 to 1 in 1965 to 325 in 2010 (FT 1/9/12, p.5).
The ruling class flaunts their wealth and power aided and abetted by the White House and Treasury. In the face of popular hostility to Wall Street pillage of Treasury, Obama went through the sham of asking Treasury to impose a cap on the multi-million dollar bonuses that the CEO’s running bailed out banks awarded themselves. Wall Streeters in Treasury refused to enforce the executive order, the CEO’s got billions in bonuses in 2011 . President Obama went along, thinking he conned the US public with his phony gesture,while he reaped millions in campaign funds from Wall Street!
The reason Treasury has been taken over by Wall Street is that in the 1990’s and 2000’s, banks became a leading force in Western economies. Their share of the GDP rose sharply (from 2% in the 1950’s to 8% in 2010 (FT 1/10/12, p.7).
Today it is “normal operating procedure” for Presidents to appoint Wall Streeters to all key economic positions; and it is ‘normal’ for these same officials to pursue policies that maximize Wall Street profits and eliminate any risk of failure no matter how risky and corrupt their practioners.
The Revolving Door: From Wall Street to Treasury and Return
Effectively the relation between Wall Street and Treasury has become a “revolving door”: from Wall Street to the Treasury Department to Wall Street. Private bankers take appointments in Treasury (or are recruited) to ensure that all resources and policies Wall Street needs are granted with maximum effort, with the least hindrance from citizens, workers or taxpayers. Wall Streeters in Treasury give highest priority to Wall Street survival, recovery and expansion of profits. They block any regulations or restrictions on bonuses or a repeat of past swindles.
Wall Streeters ‘make a reputation’ in Treasury and then return to the private sector in higher positions, as senior advisers and partners. A Treasury appointment is a ladder up the Wall Street hierarchy. Treasury is a filling station to the Wall Street Limousine: ex Wall Streeters fill up the tank, check the oil and then jump in the front seat and zoom to a lucrative job and let the filling station (public) pay the bill.
Approximately 774 officials (and counting) departed from Treasury between January 2009 and August 2011 (FT 2/6/12, p. 7). All provided lucrative “services” to their future Wall Street bosses finding it a great way to re-enter private finance at a higher more lucrative position.
A report in the Financial Times Feb. 6, 2012 (p. 7) entitled appropriately “Manhattan Transfer” provides typical illustrations of the Treasury-Wall Street “revolving door”:
Ron Bloom went from a junior banker at Lazard to Treasury, helping to engineer the trillion dollar bailout of Wall Street and returned to Lazard as a senior adviser. Jake Siewert went from Wall Street to becoming a top aide to Treasury Secretary Tim Geithner and then graduated to Goldman Sachs, having served to undercut any cap on Wall Street bonuses.
Michael Mundaca, the most senior tax official in the Obama regime, came from the Street and then went on to a highly lucrative post in the Ernst and Young corporate accounting firm, having helped write down corporate taxes during his stint in “public office”.
Eric Solomon, a senior tax official in the infamous corporate tax free Bush Administration made the same switch. Jeffrey Goldstein whom Obama put in charge of financial regulation and succeeded in undercutting popular demands, returned to his previous employer Hellman and Friedman with the appropriate promotion for services rendered.
Stuart Levey who ran AIPAC sanctions against Iran policies out of Treasury’s so-called “anti- terrorist agency” was hired as general counsel by HSBC to defend it from investigations for money laundering (FT 2/6/12, p. 7). In this case Levey moved from promoting Israels’ war aims to defending an international bank accused of laundering billions in Mexican cartel money. Levey, by the way spent so much time pursuing Israels’ Iran agenda that he totally ignored the Mexican drug cartels’ billion dollar money laundering cross-border operations for the better part of a decade.
Lew Alexander a senior advisor to Geithner in designing the trillion dollar bail out is now a senior official in Nomura, the Japanese bank. Lee Sachs went from Treasury to Bank Alliance, (his own “lending platform”). James Millstein went from Lazard to Treasury, bailed out AIG insurance run into the ground by Greenberg, and then established his own private investment firm taking a cluster of well-connected Treasury officials with him.
The Goldman-Sachs-Treasury “revolving door” continues today. In addition to past and current Treasury heads Paulson and Geithner, former Goldman partner Mark Patterson was recently appointed Geithner’s “chief of staff”. Tim Bowler former Goldman managing director was appointed by Obama to head up the capital markets division.
It should be abundantly clear that elections, parties and the billion dollar electoral campaigns have little to do with “democracy” and more to do with selecting the President and legislators who will appoint non-elected Wall Streeters to make all the strategic economic decisions for the 99% of Americans. The policy results of the Wall Street-Treasury revolving door are clear and provide us with a framework for understanding why the “profit crisis” has vanished and the crisis of labor has deepened.
The “Policy Achievements” of the Revolving Door
The Wall Street-Treasury Conundrum (WSTC) has performed herculean and audacious labor for finance and corporate capital. In the face of universal condemnation of Wall Street by the vast majority of the public for its swindles, bankruptcies, job losses and mortgage foreclosures, the WSTC publicly backed the swindlers with a trillion dollar bailout. A daring move on the face of it; that is if majorities and elections counted for anything. Equally important the WSTC dumped the entire “free market” ideology that justified capitalist profits based on its “risks”, by imposing the new dogma of “too big to fail” in which the state treasury guarantees profits even when capitalists face bankruptcy, providing they are billion dollar firms. The WSTC dumped the capitalist principle of “fiscal responsibility” in favor of hundreds of billions of dollars in tax cuts for the corporate-financial ruling class, running up record peace time budget deficits and then having the audacity to blame the social programs supported by popular majorities. (Is it any wonder these ex-Treasury officials get such lucrative offers in the private sector when they leave public office?) Thirdly, Treasury and the Central Bank (Federal Reserve) provide near zero interest loans that guarantee big profits to private financial institutions which borrow low from the Fed and lend high, (including back to the Government!) especially in purchasing overseas Government and corporate bonds. They receive anywhere from four to ten times the interest rates they pay. In other words the taxpayers provide a monstrous subsidy for Wall Street speculation. With the added proviso, that today these speculative activities are now insured by the Federal government, under the “Too Big to Fail” doctrine.
Under the ideology of “regaining competitiveness” the Obama economic team (from Treasury, the Federal Reserve, Commerce, Labor) has encouraged employers to engage in the most aggressive shedding of workers in modern history. Increased productivity and profitability is not the result of “innovation” as Obama, Geithner and Bernanke claim; it is a product of a state labor policy which deepens inequality by holding down wages and raising profit margins. Fewer workers producing more commodities. Cheap credit and bailouts for the billion dollar banks and no refinancing for households and small and medium size firms leading to bankruptcies, buyouts and ‘consolidation’ namely, greater concentration of ownership. As a result the mass market stagnates but corporate and bank profits reach record levels. According to financial experts under the WSTC “new order” “bankers are a protected class who enjoy bonuses regardless of performance, while relying on the taxpayer to socialize their losses” (FT 1/9/12, p.5). In contrast labor, under Obama’s economic team, faces the greatest insecurity and most threatening situation in recent history: “what is unquestionably novel is the ferocity with which US business sheds labor now that executive pay and incentive schemes are linked to short term performance targets” (FT 1/9/2012, p. 5).
Economic Consequences of State Policies
Because of the Wall Street “ takeover” of strategic economic policy positions in Government we can now understand the paradox of record profit margins in the midst of economic stagnation. We can comprehend why the capitalist crisis has, at least temporarily, been replaced by a profound crisis of labor. Within the power matrix of Wall Street-Treasury Dept. all the old corrupt and exploitative practices that led up to the 2008-2009 crash have returned: multi-billion dollar bonuses for investment bankers who led the economy into the crash; banks “snapping up billions of dollars of bundled mortgage products that resemble the sliced and diced debt some (sic) blame for the financial crisis” (FT 2/8/12, p.1). The difference today is that these speculative instruments are now backed by the taxpayer (Treasury). The supremacy of the financial structure of the pre-crisis US economy is in place and thriving … “only” the US labor force has sunk into greater unemployment, declining living standards, widespread insecurity and profound discontent.
Conclusion: The Case Against Capitalism and for Socialism
The profound crises of 2008-2009 provoked a spate of questioning of the capitalist system, even among many of its most ardent advocates (FT 1/8/12 to 1/30/12) criticism abounded. ‘Reform, regulation and redistribution’ were the fare of financial columnists. Yet the ruling economic and governing class took no heed. The workers are controlled by doormat union leaders and lack a political instrument. The rightwing pseudo populists embrace an even more virulent pro capitalist agenda, calling for across the board elimination of social programs and corporate taxes. Inside the state a major transformation has taken place which effectively smashed any link between capitalism and social welfare, between government decision-making and the electorate. Democracy has been replaced by a corporate state, founded on the revolving door between Treasury and Wall Street, which funnels public wealth to private financial coffers. The breach between the welfare of society and the operations of the financial architecture is definitive.
The activity of Wall Street has no social utility; its practitioners enrich themselves with no redeeming activity. Capitalism has demonstrated conclusively, that it thrives through the degradation of tens of millions of workers and rejects the endless pleas for reform and regulation. Real existing capitalism cannot be harnessed to raising living standards or ensuring employment free of fear of large scale, sudden and brutal firings. Capitalism, as we experience it over the past decade and for the foreseeable future, is in polar opposition to social equality, democratic decision-making and collective welfare.
Record capitalist profits are accrued by pillaging the public treasury, denying pensions and prolonging ‘work till you die’, bankrupting most families with exorbitant private corporate medical and educational costs.
More than ever in recent history, record majorities reject the rule by and for the bankers and the corporate ruling class (FT 2/6/12, p. 6). Inequalities between the top 1% and the bottom 99% have reached record proportions. CEO’s earn 325 times that of an average worker (FT 1/9/12, p.5). Since the state has become the ‘foundation’ of the economy of the Wall Street predators, and since ‘reform’ and regulation has dismally failed , it is time to consider a fundamental systemic transformation that begins via a political revolution which forcibly ousts the non-elected financial and corporate elites running the state for their own exclusive interests. The entire political process,including elections, are profoundly corrupt: each level of office has its own inflated price tag. The current Presidential contest will cost $2 to $3 billion dollars to determine which of the servants of Wall Street will preside over the revolving door.
Socialism is no longer the scare word of the past. Socialism involves the large-scale reorganization of the economy, the transfer of trillions from the coffers of predator classes’ of no social utility to the public welfare. This change can finance a productive and innovative economy based on work and leisure, study and sport. Socialism replaces the everyday terror of dismissal with the security that brings confidence, assurance and respect to the workplace. Workplace democracy is at the heart of the vision of 21st century socialism. We begin by nationalizing the banks and eliminating Wall Street. Financial institutions are redesigned to create productive employment, to serve social welfare and to preserve the environment. Socialism would begin the transition, from a capitalist economy directed by predators and swindlers and a state at their command, toward an economy of public ownership under democratic control.
February 18, 2012
Posted by aletho |
Corruption, Economics, Timeless or most popular | Capitalism, China, Crisis theory, Germany, Southern Europe, United States |
Leave a comment
Aletho News
