Showing posts with label political continuum. Show all posts
Showing posts with label political continuum. Show all posts

22 July 2011

The Trap: James Goldsmith on GATT and the Consequences of Multinationalism and Policy Failures



This interview was done in 1994, when Bill Clinton was promoting free trade and multinationalism, but had not yet made a deal with China to allow them to devalue their currency and then receive favored nation status.

You can decide for yourself, with the benefit of retrospect, the value of the arguments presented.

"Free trade" as defined by neo-liberal policies is a leveling tool that creates a few big winners and many more big losers, and reduces the middle class to the lowest common denominator of indentured servitude. 

The goal of multinationalism is to destroy local government, choice, and sovereignty, through financial and military means.   The will to power cuts across diverse forms of government, because of its attitude of the power of the few and the worth of the many.  It defines what is 'human' to suit its needs of the moment.

The primary problem with unregulated trade, not considered within the context of overall social and public policy,  is that it becomes a natural weapon for oligarchies and multinationals to use against local and regional government and public policy decisions, taxation, environmental laws, human rights.  It is a major stepping stone to world government. There is a recurring movement among the powerful to bring the world under their control. It is the natural extension of their greed for power. There is never 'enough.'  Sociopathic greed is a disease, and it sows the seeds of its own destruction.  Always. 

And this is why idealistic models of unregulated free market economics fall apart in practice, always.

Trade *could* be used to uplift the developing world, if it was accompanied by local reforms and progressive public policy, but in practice is most often used to create a huge social divide in the developed countries, and promote a return to a feudalistic political structure. Rather than uplift, it reduces the world to the least common denominator of quality of life and freedom. 

One of the most significant problems is mercantilism, employed by oligarchic countries and multinational corporations, within the context of a fiat currency system wherein they are relatively free to short circuit all the market mechanisms that would prevent a few countries from creating enormous trade imbalances in a partnership with powerful elites and the privileged around the world.

Macro-economics has never been a pure science, but is often represented as such by those who are promoting theories that are purely political, cloaking them in false objectivity. Macro-economics is a social science, more like sociology than physics. In reality it is a subset of public policy discussions, highly slanted to ends and assumptions, attitudes and points of view about what is 'good' and valuable rather than what is a hard and replicable principles of nature, objectively true based on some endurable physical law. 

So for example, if someone were to come out and say, "I think we should adopt the social structure of a nation and form of government your father spent much of their lives fighting and dying, where you give up most of your wealth and freedom to serve the powerful few who run the state," there would be a general uprising. But if the proposition is structured as the logical consequence of 'hard economic choices,' and a serious of crises, people can be led off the cliff, a few steps at a time.
"The liberties of our country, the freedoms of our civil Constitution are worth defending at all hazards; it is our duty to defend them against all attacks. We have received them as a fair inheritance from our worthy ancestors. They purchased them for us with toil and danger and expense of treasure and blood. It will bring a mark of everlasting infamy on the present generation – enlightened as it is – if we should suffer them to be wrested from us by violence without a struggle, or to be cheated out of them by the artifices of designing men."

Samuel Adams
If this trend continues, I would imagine the next step is civil unrest, and political crises that will be used to tighten the control over the public in the 'free countries,' and repress them for their own safety.  We are seeing this now in the Anglo-American client states and unpopular dictatorships overseas.

Most men are easily fooled, entrapped by their emotions, easily herded by clever arguments and the dialectic of false enemies. It is only when they step back, and look at what is happening, who benefits and who is above the law, that they begin to realize the truth. But they will not do this for quite some time, because to do so is to admit that they have been fools.  

How sad that the heirs to the 'greatest generation,' almost surely the most privileged generation in history, have in their excess become selfish, petty, and cruel.

The corollary of a few "Too Big To Fail" is that there are many individuals and small businesses who become "Too Small To Care" and then "Too Weak To Survive."

And so the weak and the undesirable are eliminated, first slowly and then with growing efficiency, for the good of the chosen few, the ubermensch, however a society chooses to define it.

Does this sound *conspiratorial* and outlandish? Check back in another ten years, and let me know how you and your children are doing. There was a budget surplus in the 1990's.  And now the nation is throwing the middle class and the weak under the bus for the sake of the financial sector and the wealthy.

Once a single global currency is achieved, it is the end game for freedom for all but a few. Those who imagine that they are part of the few are all for this, although they are sadly mistaken.  The few view them as useful idiots, disposable, and prey.

What the few themselves may not yet realize is that tyrants and empires tend, almost inevitably, to fall in disgrace, blinded and betrayed by the will to power, overcome by the love of freedom and the tide of history.  So there is hope.  But sometimes hope can become a distant memory, and freedom regained only by significant pain and loss of life, once you have released it from your grasp.
"When I despair, I remember that all through history the ways of truth and love have always won. There have been tyrants, and murderers, and for a time they can seem invincible, but in the end they always fall. Think of it--always.

Mohandas K. Gandhi



30 June 2010

Class War and the Decline of the West


Before he rediscovered his self interest, ignoring the outrageous financial frauds perpetrated by his own ratings agency, Warren Buffett famously said, “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”

I find it remarkable that there is so little meaningful discussion of this in mainstream circles. Well perhaps not, considering that most of them are now owned by a few major corporations.

The key to stopping this theft of your freedom is purging the political system of the corruption of paid influence, campaign contributions by non-persons like corporations, special interest groups, and unions, the breaking up of the media conglomerates that seek to control the news, and the implementation of a system of sound money for international trade at least, using a standard that resists the manipulation of the financial system as outlined in Hugo Salinas-Price's quietly brilliant and remarkably insightful essay, Gold Standard: Protector and Generator of Jobs.

The powers that be will fight reform every step of the way, using propaganda and your prejudices and emotions against you. The best way to conquer a people is to persuade them to enslave themselves using slogans and simplistic views of the world that play on their fears and hatreds. The neo-liberal economic fraud that was scripted by the monied interests is played out daily to vast audiences using actors and actresses masquerading as politicians, analysts, and commentators.

I receive at least ten emails per day from the self-enslaving, sadly to say mostly older men like myself, that repeat the slogans and urban myths like faithful party members, seasoned with hateful prejudice and mindless propaganda, so I know that the influence peddlers and indoctrinators are doing a good job of it, subverting the middle class.

It is a little remembered fact that the greatest boost in support for the rise of the National Socialist party came not from the underclasses which had always been a minority player on the political stage, but from the more influential professional class, the petit-bourgeois: doctors, dentists, accountants, shop owners, and small business owners. They added their force to the earliest supporters , the industrialists and the monied interests, the bankers and the industrialists.

This is how the National Socialists were able to so easily co-opt the medical profession and educated classes into the early horrors of euthanasia, sterilization, and then finally extermination of whole categories of 'undesirables.' The middle class thought they could ride the wave, the will to power, in their greed and hate and revenge, but they soon learned that madness has no master, consuming all with fire.

This is how your freedom, your wealth, will be taken from you and your children, their futures devastated. So it is something with which you might wish to be familiar, so you can at least explain it to them when they are homeless in the land their forefathers gave you.

"For we wrestle not against flesh and blood, but against principalities, against powers, against the rulers of the darkness of this world, against spiritual wickedness in high places." Ephesians 6:12
Here is a recent essay by Professor Ismael Hossein-zadeh that is worth reading.
"Never before has so much debt been imposed on so many people by so few financial operatives--operatives who work from Wall Street, the largest casino in history, and a handful of its junior counterparts around the world, especially Europe.

External sovereign debt, as well as occasional default on such debt, is not unprecedented [1]. What is rather unique in the case of the current global sovereign debt is that it is largely private debt billed as public debt; that is, debt that was accumulated by financial speculators and, then, offloaded onto governments to be paid by taxpayers as national debt. Having thus bailed out the insolvent banksters, many governments have now become insolvent or nearly insolvent themselves, and are asking the public to skimp on their bread and butter in order to service the debt that is not their responsibility.

After transferring trillions of dollars of bad debt or toxic assets from the books of financial speculators to those of governments, global financial moguls, their representatives in the State apparatus and corporate media are now blaming social spending (in effect, the people) as responsible for debt and deficit!

President Obama's recent motto of "fiscal responsibility" and his frequent grumbles about "out of control government spending" are reflections of this insidious strategy of blaming victims for the crimes of perpetrators. They also reflect the fact that the powerful financial interests that received trillions of taxpayers' dollars, which saved them from bankruptcy, are now dictating debt-collecting strategies through which governments can recoup those dollars from taxpayers. In effect, governments and multilateral institutions such as the IMF are acting as bailiffs or tax collectors on behalf of banksters and other financial wizards.

Not only is this unfair (it is, indeed, tantamount to robbery, and therefore criminal), it is also recessionary as it can increase unemployment and undermine economic growth. It is reminiscent of President Herbert Hoover's notorious economic policy of cutting spending during a recession, a contractionary fiscal policy that is bound to worsen the recession. It is, indeed, a recipe for a vicious circle of debt and depression: as spending is cut to pay debt, the economy and (therefore) tax revenues will shrink, which would then increase debt and deficit, and call for more spending cuts.

Spending on national infrastructure, both physical (such as roads and schools) and social infrastructure (such as health and education) is key to the long-term socioeconomic developments. Cutting public spending to pay for the sins of Wall Street gamblers is bound to undermine the long-term health of a society in terms of productivity enhancement and sustained growth.

But the powerful financial interests and their debt collectors seem to be more interested in collecting debt claims than investing in economic recovery, job creation or long-term socioeconomic development. Like most debt-collecting agencies, the IMF and the states serving as banksters' bailiffs through their austerity programs may shed a few crocodile tears in sympathy with the victims' of their belt-tightening policies; but, again like any other debt-collecting agents, they seem to be saying: "sorry for the loss of your job or your house, but debt must be collected--regardless."

A most outrageous aspect of the debt burden that is placed on the taxpayers' shoulders since 2008 is that most of the underlying debt claims are fictitious and illegitimate: they are largely due to manipulated asset price bubbles, dubious or illegal financial speculations, and scandalous conversion of financial gamblers' losses into public liability.

As noted earlier, onerous austerity measures to force the public to pay the largely fraudulent external debt is not new. Benignly calling such oppressive measures "Structural Adjustment Programs," the International Monetary Fund and the World Bank have for decades imposed them on many less developed countries to collect debt on behalf of international financial titans.

To "help" the indebted nations craft debt-servicing arrangements with external creditors, the IMF imposed severe conditions on the way they managed their economies--just as it is now imposing (in collaboration with the European and American bankers) those austerity policies on the debtor nations in Europe. The primary purpose of such restrictive conditions is to divert or transfer national resources from domestic use to external creditors. These include not only belt-tightening measures to cut social spending and/or raise taxes, but also selling-off public enterprises, national industries, and future tax revenues.

Calling such fire-sale privatization deals "briberization," the ex-World Bank chief economist Joseph Stiglitz revealed (in an interview with the renowned investigative reporter Greg Palast) how finance ministers and other bureaucratic authorities in the debtor countries often carried out the Bank's demand to sell off their electricity, water, transportation and communication companies in return for some apparently irresistible sweetener. "You could see their eyes widen" at the prospect of 10% commissions paid to Swiss bank accounts for simply shaving a few billions off the sale price of national assets..."

Ismael Hossein-zadeh, The Vicious Circle of Debt and Depression: It Is a Class War

Here is a lengthier history of the undermining of the US political system using financial fraud from Renaissance 2.0.

The bailout of AIG is near the core of the great fraud. Crack that nut, and we may learn something about financial fascism and the Fed. That is why they may dance around it, but they will never take down the principals and bring the truth out into the light of day.

Le monde est sourd. The world is deaf, and the truth has no place to lay his head in their hearts.



I am a citizen of the world, and nothing is alien to me except sin.

03 May 2010

GDP Deflator at a Five Decades Low While Income Inequality Is at Record Highs


From this chart sent out this morning by David Rosenberg, we can see that the GDP deflator is at a five decades low.

I tend to believe that the modifications to the inflation measures, including the deflator, that have accumulated by the federal bureaucracy over the past ten years are greatly understating the actual inflation in the economy.

There are very positive benefits for the government to do this. The lower the deflator, the better and higher the real GDP figures will appear. And a low measure of official inflation reduces increases in payments in Social Security and other programs with Cost of Living Adjustments (COLA), including official debt payments on the bonds and the TIPS.



Gold gives the lie to this, which is why it is so hated by financial engineers and statists.

On the other hand, the inequality of income distribution in the US is at level not seen since the 1920's.



There is some good reason to think that government tax and fiscal policies, as well as the monopolistic makeup and subsidized growth of the Banking sector facilitates this wealth transfer and concentration, which has a highly negative impact on real economic growth.

There will be a change, and the trends will be reversed. How they are reversed and what changes will accompany those reversals are very much open to debate, and divergent historical examples. But these changes almost invariably involve a shift from individualism to statism.



"Those who make peaceful revolution impossible make violent revolution inevitable."

John F. Kennedy

Change will come if the system remains as unsustainable as it is now. And what gives me a somewhat pessimistic view is that people never seem to learn the lessons of history.

07 March 2010

Iceland Voters Reject Bank Bailouts in Crushing Electoral Defeat; Neo-Liberalism In Context


"Voters rejected the bill because ordinary people, farmers and fishermen, taxpayers, doctors, nurses, teachers, are being asked to shoulder through their taxes a burden that was created by irresponsible greedy bankers."

"Is there any reason why the American people should be taxed to guarantee the debts of banks, any more than they should be taxed to guarantee the debts of other institutions, including merchants, the industries, and the mills of the country?" Senator Carter Glass (D-Va), author of the Banking Act of 1933 and of Glass-Steagall

It is interesting that the government of Iceland had already declared the vote of the people as 'obsolete.' One has to wonder when the voters will declare their current government and their representatives as obsolete. One would give the government credit for at least allowing a vote on a referendum, but to then disregard and circumvent it through political devices is seems like a base hypocrisy.

Iceland is a victim of the neo-liberal economic deregulation of the 1990's, in which a few bankers can buy the government, and rack up enormous profits for themselves in Ponzi like leverage, and then attempt to socialize the debt back to the people when their schemes collapse.

Neo-Liberalism is a system of economic thought embracing the efficient markets hypothesis, the inherent good of deregulation and the natural impediment of government regulation, the necessity of free trade and globalization, the supremacy of the corporation over the individual person in the social economy, and supply side economics. It most likely favors a one world currency and consolidation of production into large corporate combinations or 'trusts' under the principle of laissez-faire.

Neo-liberalism may degenerate into crony capitalism, or even corporatism, as its theoretical idealism of perfect rationalism and virtue falters against the reality of human behaviour. In times of financial crisis, for example, neo-liberalism ironically turns to centralized economic planning by allegedly private banks which appropriate public funds and the power of the monetary license to socialize private debts, and, in a strikingly Orwellian twist, eviscerate the discipline of the markets and the individual to preserve their freedom, and the well being of the private corporations. Although now largely repudiated, neo-liberalism has strong roots in the public consciousness, and its adherents hold considerable power in Western governments and among the 'freshwater school' of American economics.

What makes neo-liberalism and neo-conservatism 'neo' or new is their attitude towards the relationship of the individual to the state. Both tend to denigrate and diminish the condition and rights of the inividual as compared to the consideration of the corporate system or the centralized command state.

In the States, the Congress and the President have just ignored the massive protests against their own bank bailouts. The US was able to cloak its own debt assumptions through accounting frauds, claiming that the bailouts were repaid by the banks. The bailouts are wrapped in AIG, Fannie and Freddie, and the Federal Reserve. This is the advantage of owning the currency, the IMF and ratings agencies. And of course your media.

Although Europeans and the markets are looking at the 'PIGS' for the next serious default as the economic hitmen are moving from Iceland to Greece, the real test of globalization in financial markets and the dominant control of the private banks will come in the UK, a sovereign people too proud and strong to go down into feudal servitude and the rule of tyrants easily. Or at least one would hope.

The Relationship of the Condition and Rights of the Individual to the Organized State




Bloomberg
Iceland Rejects Icesave Depositors Bill in Referendum

By Omar R. Valdimarsso

March 7 (Bloomberg) -- Icelanders rejected by a massive majority a bill that would saddle each citizen with $16,400 of debt in protest at U.K. and Dutch demands that they cover losses triggered by the failure of a private bank.

Ninety-three percent voted against the so-called Icesave bill, according to preliminary results on national broadcaster RUV. Final results will be published today.

The bill would have obliged the island to take on $5.3 billion, or 45 percent of last year’s economic output, in loans from the U.K. and the Netherlands to compensate the two countries for depositor losses stemming from the collapse of Landsbanki Islands hf more than a year ago. The island’s political leaders say they’ve already moved on to talks over a new accord.

“The government’s survival doesn’t rest with this Icesave vote,” Prime Minister Johanna Sigurdardottir told RUV after the preliminary count was announced. “The government coalition remains solid,” Finance Minister Steingrimur Sigfusson told RUV.

Failure to reach an agreement on the bill has left Iceland’s International Monetary Fund-led loan in limbo and prompted Fitch Ratings to cut its credit grade to junk. Moody’s Investors Service and Standard & Poor’s have signaled they may follow suit if no settlement is reached.

‘Obsolete’

Iceland’s leaders are trying to negotiate a new deal with the U.K. and the Dutch that focuses on the interest rate payable on the loan, making the bill in yesterday’s vote “obsolete,” Sigurdardottir said on March 4.

Dutch Finance Minister Jan Kees de Jager in a statement posted on the Internet last night said he is “disappointed” the agreement hasn’t yet come into effect. The U.K. was “obviously disappointed,” while “not surprised,” said a Treasury official who declined to be identified in line with departmental policy.

Iceland’s government pointed to “steady progress toward a settlement” in the past three weeks in a statement.

“The British and Dutch Governments have indicated a willingness to accept a solution that will entail a significantly lower cost for Iceland than that envisaged in the prior agreement,” the statement said.

The U.K. and Netherlands have offered an interest rate of the London Interbank Offered Rate plus 2.75 percentage points, according to the U.K. Treasury official. That’s the same as the rate for the loan from the Nordic countries that the Icelandic Government accepted in July 2009. The new offer also gave relief on the first two years of interest for the loan, amounting to 450 million euros.

‘Ordinary People’

The three governments have declared their intention to continue the talks, the Iceland statement said.

Voters rejected the bill because “ordinary people, farmers and fishermen, taxpayers, doctors, nurses, teachers, are being asked to shoulder through their taxes a burden that was created by irresponsible greedy bankers,” said President Olafur R. Grimsson, whose rejection of the bill resulted in the plebiscite, in a Bloomberg Television interview on March 5.

The Icesave deal passed through parliament with a 33 to 30 vote majority. Grimsson blocked it after receiving a petition from a quarter of the population urging him to do so. The government has said it’s determined any new deal must have broader political backing to avoid meeting a similar fate.

Icelanders used the referendum to express their outrage at being asked to take on the obligations of bankers who allowed the island’s financial system to create a debt burden more than 10 times the size of the economy.

Protests

The nation’s three biggest banks, which were placed under state control in October 2008, had enjoyed a decade of market freedoms following the government’s privatizations through the end of the 1990s and the beginning of this decade.

Protesters have gathered every week, with regular numbers swelling to about 2,000, according to police estimates. The last time the island saw demonstrations on a similar scale was before the government of former Prime Minister Geir Haarde was toppled.

Icelanders have thrown red paint over house facades and cars of key employees at the failed banks, Kaupthing Bank hf, Landsbanki and Glitnir Bank hf, to vent their anger. The government has appointed a special commission to investigate financial malpractice and has identified more than 20 cases that will result in prosecution.

Economic Impact

The island’s economy shrank an annual 9.1 percent in the fourth quarter of last year, the statistics office said on March 5, and contracted 6.5 percent in 2009 as a whole.

Household debt with major credit institutions has doubled in the past five years and reached about 1.8 trillion kronur ($14 billion) in 2009, compared with the island’s $12 billion gross domestic product, according to the central bank.

Icelanders, the world’s fifth-richest per capita as recently as 2007, ended 2009 18 percent poorer and will see their disposable incomes decline a further 10 percent this year, the central bank estimates.

Grimsson, who has described his decision to put the depositor bill to a referendum as the “pinnacle of democracy,” says he’s not concerned about the economic fallout of his decision.

“The referendum has drawn back the curtain and people see on the stage the matter in a new perspective,” he said in an interview. “That has strengthened our position and our cause.”


23 May 2009

Update on the Political Continuum: Obama Moves Sharply Towards Nationalizaton


Obama is moving slowly but surely towards more overt state socialism.

There is an interesting twist of crony capitalism in his Administration especially from his economics team. It will be interesting to see how that develops. Will it become something akin to the post-Soviet Russian oligarchs with official state ties?



30 March 2008

The Political and Economic Continuum: Where Are We Today, Where Are We Going?


This essay from the International Herald Tribune is a sound analysis of where we are now and where we have been. It reinforces our notion that the old ways of approaching problems have failed. A new school of economics will rise out of the ashes of the economic failure to come as Keynesianism rose out of the Great Depression, as monetarism rose out of stagflation.

With regard to free market capitalism, we still think it is the best approach to a well-functioning society, but would like to see a return to it at least here in the United States. Sociopathic elements always try to corrupt the game, replacing the meritocracy with oligopoly and competition with monopolistic croney capitalism. Freedom is not a goal; it is a way of life.

The solution seems obvious: a society of laws that respects the rights of the individual to both excel or just get by in a meritocracy, with an equitable distribution of goods with a reasonable variation based on effort and ability, enforced with equal justice. The trick seems to be not imagining a solution, but rather in implementing it, achieving it, and keeping it.

The dynamic tension is not between the traditional right and traditional left in politics. That is largely a matter of preference between the amounts of tradition and progress, and the rate of societal change. The genuine conflict is between the power of the state and of the individual, between the will to power of an elite and the broad rights of the individual to life, liberty and the pursuit of happiness.

The extremes of both Left and Right meet in the same place: Stalin and Hitler, the all-consuming state and the complete diminishment of the rights of the Individual.

"The issue today is the same as it has been throughout all history, whether man shall be allowed to govern himself or be ruled by a small elite." - Thomas Jefferson

"Sell not virtue to purchase wealth, nor Liberty to purchase power." Benjamin Franklin

"The only sure bulwark of continuing liberty is a government strong enough to protect the interests of the people, and a people strong enough and well enough informed to maintain its sovereign control over the government." - Franklin Delano Roosevelt

Benjamin Franklin was approached by a group of citizens asking what sort of government the delegates had created. His answer was: "A republic, if you can keep it."


The failure of neo-liberalism
By Phillip Blond
Tuesday, January 22, 2008
LANCASTER, England

More and more, it appears that in the 21st century we are returning to the economics of the 19th, where wealth was overwhelmingly concentrated in the hands of a few owners and astute speculators.

Neither the Right nor the Left seem capable of creating a society in which all benefit from increased prosperity and economic security.

Right-wing claims that free markets will enrich all sections of society are palpably false, while the traditional European welfare state appears to penalize innovation and wealth-creation, thereby locking the poor and unskilled into institutionalized poverty and unemployment.

Thus in the new age of globalization, both ideologies create the same phenomenon: an underclass caught between welfare and low wages, a heavily indebted middle class increasingly subject to job and pension insecurity and a new class of the super rich who escape all rules of taxation and community.

It was in Britain that neo-liberalism first emerged in its decisive form. Confronted with union militancy and the apparent bankruptcy of the welfare state, the Conservative party under Margaret Thatcher was elected in 1979. In America, Ronald Reagan took office in 1981, and the Anglo-Saxon countries have pursued and advocated free market liberalization ever since.

Today, its reach extends as far as communist China, which, while eschewing political freedom, fervently preaches economic liberalization. This year even the French acknowledged free market supremacy, electing a president who has persistently denounced the costs of Gallic welfarism and praised the economic advantages of the Anglo-Saxon model.

But the benefits of free market liberalization depend on who you are, where you are and how much money or assets you had to begin with.

In terms of economic development, free market fundamentalism has been a disaster. The free market solutions applied to Russia during the Yeltsin years succeeded only in mass impoverishment, the creation of a hugely wealthy oligarchical class and the rise of an authoritarian government.

Similarly, the growth rates of Latin America and Africa, which had been higher than other developing nations, dropped by over 60 percent after they embraced IMF-sponsored neo-liberalism in the 1980's, and have now ground to a halt.

On an individual level, a similar story pertains. Real wage increases in the top 13 countries of the Organization for Economic Cooperation and Development (OECD) have been below the rate of inflation since about 1970.

Thus wage earners - rather than asset owners - have faced a persistent 30-year downward pressure on their standard of living. It comes as no surprise to learn that the golden age for the wage worker, expressed as a percentage share of GDP, was between 1945 and 1973, and not under economic liberalization.

Nobody questions that trade increases prosperity, and that the liberalization of credit and financial services allow hitherto excluded groups to supplement their wages by buying shares or houses and thus participating in the asset economy.

But the real story of neo-liberal success is not the extension of assets to all, but the huge and disproportionate share of wealth attained by the very rich. In the United States, between 1979 and 2004 the wealthiest 1 percent saw an increase in their share of national income of 78 percent, whereas 80 percent of the population saw an overall decrease in their income share by 15 percent. That's a wealth transfer from the large majority to a tiny minority of some $664 billion.

The traditional Left panicked in the face of neo-liberal hegemony and spoke in the 1980's of redistribution, higher taxes and restrictions on capital transfers. But, outside of Scandinavia, they were whistling in the wind: Traditional state-regulated economies appeared locked into high unemployment and low growth.

A new path for the Left was offered by the country that first experienced the new Right: the UK. By the late 1990's, Britain was exhausted by Thatcherism; its public services were failing and the country was socially and economically fragmented. Thus in 1997 New Labor was elected.

Under the guidance of Tony Blair and Gordon Brown, the new progressives promised that the benefits of rising prosperity would be applied to the public sector and the poor. Social exclusion would be tackled by opening up education and extending opportunity to all. The rest of the world was once more transfixed by the social experiment taking place in Britain. Could this seemingly exclusive neo-liberal circle be squared for the benefit of all?

Sadly, after 10 years the conclusion has to be no.

Poverty in Britain doubled under Thatcher, and this figure has become permanent under New Labor. The share of the wealth, excluding housing, enjoyed by the bottom half of the population has fallen from 12 percent in 1976 to just 1 percent now. Thirteen million people now live in relative poverty. Social mobility has declined to pre-war levels.

The least able children from the richest 20 percent of the population now overtake the most able children from the bottom 20 percent by the age of seven. Nearly half of the richest group go on to get university degrees while only 10 percent of the poorest manage to graduate. Clearly, the New Left has entrenched class division even more firmly than the neo-liberal Right.

This in a nutshell is the problem: Both Left and Right seem incapable of challenging monopoly capitalism. Neither welfarism nor statism can transform the lives of the poor, and neither, it seems, can neo-liberalism. Only a shared economy can correct the natural tendency of the free market to favor monopolies.

But we can only share if all own. Thus there is a radical and as yet unexplored possibility - that of a general and widely distributed ownership and use of assets, credit and capital. This would dissolve the conflict between capital and labor since it would be a market without monopoly and a state where waged labor - since it was the owner of capital - did not need state welfare.

Phillip Blond is a senior lecturer in philosophy and theology at the University of Cumbria.

The Failure of Neo-Liberalsim

„Niemand ist hoffnungsloser versklavt, als die, die fälschlicherweise glauben, sie seien frei.“
(None are so hopelessly enslaved as those who falsely believe they are free.)


J. W. von Goethe