Tuesday, July 7, 2015

Austerity is not going to go away even though the whole world now knows it's a total disaster


There's been a lot of talk about the beginning of the end of austerity because everyone now knows that it's been a total, complete, disaster.

(Look at Obama's response when asked about the Greek vote and austerity. He was silent because his benefactors want him to stay out of it and leave THEIR interests alone!)
Reporters pressed Josh Earnest, President Barack Obama’s spokesman, for details of what his boss thought of the vote and of the bailout deal, and whether he agreed with 2016 Democratic presidential candidate Bernie Sanders that the latter was outrageous. Earnest answered with streams of polite words that added up to ... nothing. Obama was staying out of the issue, as he apparently had promised German Chancellor Angela Merkel he would when they met at the G-7 summit recently.

However, don't believe this. Austerity ABSOLUTELY is in the interests of the "Powers That Be." It benefits the oligarchs, finance capitalists and big business and they are the OWNERS of government everywhere.

Do not think that because you vote you have a voice. You have no voice unless you are in that club that I mentioned above.

Austerity will continue.

22 comments:

Brian Romanchuk said...

There's a reason that groupthink is a major theme of Bill Mitchell's book on the eurozone.

Malmo's Ghost said...

If Syriza capitulates and sells out, even if it simply signs off on austerity light, then I might become a full fledged member of the global misanthrope society.

Ignacio said...

Syriza is ready to capitulate. But on the other side they may go to force a Grexit to discipline other Europeans. From NC:

On Monday, Tsipras formed a new coalition that included the firmly pro-Eurzone parties of To Potami and New Democracy. When we suggested a couple of months ago that Tsipras would do that in order to cut a deal with the creditors, readers rejected it out of hand. That does not mean Tsipras will succeed; the mood in Berlin and other hardline countries is set on regime change, and the Eurozone rules mean all it takes is one holdout to scupper a deal.

The whole referendumb was a farce.

Dan Lynch said...

Agree 100% with Mike. Neoliberalism is working great for the ruling class. The rest of us have no power. If we want power, we'll have to physically take it.

Tom Hickey said...

Agree 100% with Mike. Neoliberalism is working great for the ruling class. The rest of us have no power. If we want power, we'll have to physically take it.

I hope it hasn't come to that yet. As long as TPTB allow free elections, there is a possibility for change though the political process.

But that requires an informed and committed electorate. The question is whether one can come to be before a huge crisis destroys trust in the system so badly that people rise up angry. But if that should happen there is likely to be common agreement on removing TPTB but not over what to replace them with.

The US is very divided on that score for example. Some sociologists and political scientists have suggested that the US could even break apart along regional lines.

What could cause a crisis of that magnitude? Civilization hangs by a thin thread. There are a lot of ways for that thread to break — war, depression, epidemic, global warming creating resource shortages and resultant migrations, etc.

What I see as particularly concerning now is the plight of youth and the effects it will have has this generation passes through the stages of life. We have already seen how big an effect the boomers had. The present generation coming of age is in a much worse position with the challenges they are facing to education, employment, housing, etc. And this is taking place in many of the most developed countries. This is already creating problems but those problems are just beginning unless this is addressed quickly.

mike norman said...

Tom, we had "change you can believe in," remember? And where did that get us? Sixty-five million people voted for Obama--twice--and the neoliberal doctrine still has a deep ahold on us. Even more so.

Anonymous said...

It's worth mentioning that not ever the core neoliberals are on board with the austerity plan. The IMF decisively retracted their earlier support for austerity. As Munchau pointed out in his recent column, there are virtually no serious economists anywhere defending austerity. Austerity, and attempted stabilization though budget tightening and surpluses, is a crackpot pseudo-economic philosophy cooked up in EU capitals by stupid politicians and bad economists in the early days of the crisis, which they now cannot let go of for political reasons and ego.

Tom Hickey said...

I agree, Mike, but so far most of the left is either clueless about what's happening or clueless about what to do about it. Occupy was the biggest uprising we've had since the anti-war protests of the 70's and it it was pretty limited in comparison. Moreover, there was no consensus about what to actually do.

There are much larger numbers on the right, and they have a much clearer idea of what they want and how to get there and they are well-armed, not that it makes a huge difference against a militarized domestic security force back up by a powerful military and total surveillance.

The strategy of TPTB against superior number is "divide and you've already conquered" along with a deep and wide propaganda apparatus.

That's why it takes a real breakdown to get people organized around a goal and a strategy. That happened at the time of Vietnam and the draft since a lot of people were faced with being turned into hamburger if they didn't so something radical about it.

For whatever reasons, there was a lot more social consciousness then than there seems to be now. Everyone is lost in their devices, which have become the new chains.

Tom Hickey said...

Let's be clear about what "austerity" is. It is destruction of the welfare state and tis replacement by the market state

That would be "free market" meaning from of government rather than "competitive market" which is a market free of economic rent as unearned gain, which the last thing that TPTB want.

It's about not taxing ownership and "job creators," and taxing workers, reducing worker benefits and protections, and reducing labor power. This is what "austerity." "reform," "structural" and "efficiency" really mean when TPTB use these terms.

lastgreek said...

Tom, we had "change you can believe in," remember?

You also had "HOPE." Don't forget that ;)

Anonymous said...
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Malmo's Ghost said...

Tom,

Colleges today are by and large mental muck factories. In the 60's not nearly as much. Couple that with our modern day moronic pop culture obsession and its attendant sound bite mentality and you get lack of depth writ large on virtually all matters of import.

Also, The MSM are simply corporate toadys who delight in keeping the masses literate enough to be easily brainwashed, voracious consumers. Thus I have little hope for a meaningful uprising among the masses.

Jeffersonian democracy requires as antecedent truly informed people that can articulate intelligently and act thoughtfully, in their collective best interest. Ignorance also foments polarization, especially when ideas get ignored in favor of simple minded identity politics.

All in all I can't help but be a pessimist when it comes to thoughtful mass resistance to our corporate governance, which thrives on dumbed down masses.

Anonymous said...

Let's be clear about what "austerity" is. It is destruction of the welfare state and its replacement by the market state.

I don't really agree with that as a complete understanding of "austerity". If a country taxes 50% of its national income and simply transfers it to other people in the economy, that may or may not boost employment, investment and growth - it all depends on who's getting taxed and who's getting the transfers. Certainly a transfer system that redistributes income from the top and spreads it broadly throughout the middle and bottom can be effective to some degree.

But the more important issue is how much the government is spending in ways that promote growth, and stimulate both aggregate supply and demand in the economy. That includes a willingness to deficit spend, and also a willingness to be an active driver of innovation, growth and economic development through a strategic industrial policy, social development, human resource development, etc. The big western problem now is the problem of missing states. While transfers remain high, public sector consumption and investment are low and declining.

Many European states still run very large social states. But they are still being tight-fisted and austere. That's because they are obsessed with getting surpluses, which are contractionary other things being equal, and are playing a passive economic role in the direction of the economy.

The big, stupid problem of the contemporary left - as represented in the original Occupy movement and people like David Graeber - is that it is shot through and through with anarcho-libertarianism, anti-statism, and fantasy world hippie localism with dreams of reverting to the norms of what are effectively stone age economies based on gifting, sustenance, etc. It's utterly stupid and unbelievably crude and historically ignorant.

The only way the masses of ordinary people have ever effectively fought the ravages of concentrated private capital domination is to build and use powerful states to exert broad-based governance control over both the income system and the general direction and strategy for the economy. As long as the left keeps wandering in the backward intellectual anarcho-lib wastelands staked out by the Graebers and Chomskies of the world, they will keep losing, keep failing the people they want to help, and keep wandering.

Fortunately there are enough people like Sanders and the resurgent labor movement with grown up "old left" sensibilities to fight back against a lot of that juvenile nonsense, and fight the fight. There are some encouraging signs the tide is turning.

lastgreek said...

Dan, Chomsky has argued for a powerful, federal state.

Tom Hickey said...

The big, stupid problem of the contemporary left - as represented in the original Occupy movement and people like David Graeber - is that it is shot through and through with anarcho-libertarianism, anti-statism, and fantasy world hippie localism with dreams of reverting to the norms of what are effectively stone age economies based on gifting, sustenance, etc. It's utterly stupid and unbelievably crude and historically ignorant.

The only way that folks who did not want to enter the capitalist system could find an alternative was to create one. That grew into a multibillion dollar parallel economy that has been partly a visible alternative and partly an invisible underground. Ten of thousands of people if not hundreds of thousands have lived in that economy almost exclusively over the past fifty years. It's still the best alternative and at lot of people at Occupy came to realize that in the same way that many of us did bank then when they beat the hell out of us. It was clear that the only way to deal with them was to be invisible to them.

"Be transparent to your friends, who is anyone you can trust to voluntarily cooperate for mutual benefit, and be invisible to your enemies, which is anyone that seek to control you."

Fortunately there are enough people like Sanders and the resurgent labor movement with grown up "old left" sensibilities to fight back against a lot of that juvenile nonsense, and fight the fight. There are some encouraging signs the tide is turning.

Well see how far that goes. Obama was selling "hopium" too. We are already seeing what "Marxist" Syriza is doing in Greece. Tsipras is drawing up a surrender document today. Sanders wants to tax some rich people. Really? That's a platform, vision, and plan?

The so-called left is a waste of time. It's just status quo lite. I haven't seen anyone present a comprehensive vision let alone a scalable plan for political change within the system. The system has its own institutional momentum and it's going to go on for some time. People that want to live differently are best advised to recognize that and not wait for things to go their way. You have to create your own future.

I made the decision to leave the status quo and burn my bridges to it back then and since then I have never looked back. So I turned on my crap detector, tuned into my heart, and dropped out of the status quo and joined others of like mind in building an alternative that we wanted to live in. I would do the same today. It's actually simpler now since the ground has been broken. Not as exciting though, since we were pioneering them and in the process radically affected the culture.

Y'all come on in, the waters fine.

Ignacio said...

Tom do you realize that most of those lefties in the 70 are now neolibs running the show? Food for thought... The challenges, social mood and issues back then were different.

The current moment is more akin to the last XIX century and the 30's in the early XX century than to the 70's. No offence but I don't think that movement was as revolutionary as some think it was.

Now we are fighting truly for reshaping (for the good or for the bad) of the whole world economic system, back then it was some fighting about some civil rights while living in growing economies driven by Keynesian principles with not even close to the challenges we are facing right now which could mean the extinction of a big chunk of human population in the worst case (only coming close to that is the Cuba nuclear missiles crisis).

We are facing a choice between slavery and feudalism and MAYBE democracy and progress. Not comparable at all IMO. And liekwise this battle is goign to be much longer that that one, it will span several decades and generations (it already does), nothing like the mid 60's-70's.

Tom Hickey said...

Tom do you realize that most of those lefties in the 70 are now neolibs running the show? Food for thought... The challenges, social mood and issues back then were different.

Right. They got do-opted, became yuppies and went for the money. Even Jerry Rubin.

John Kerry was anti-war activist during the Vietnam protests, and it probably cost him the presidency.

But a lot of folks hung in there, too.

Tom Hayden, famous as the husband of Jane Fonda, was the drafter of the SDS manifesto, the Port Huron Statement. He remained a life-long activist and was elected to the California Assembly and Senate. He is the director of the Peace and Justice Resource Center in Culver City, California, at age 76.

Unknown said...

Good conversation everybody. I've really enjoyed the increased commentary (at least perceived for my part, it may just be normal if you ran the numbers on MNE which would make this part of my comment irrelevant) that the Greek situation has seemed to generated the last 10 days or so???

Anyways, I just wanted to point out one relevant factor that came into my mind reading this thread....China. One of the main differences for the USA and its close western allies between the cold war era "golden period of capitalism" (50's - late 70's) and the subsequent four decades has been the lack of a true rival. Some external force that trumps internal divisions at least to some extent. Two brothers who fight incessantly will join forces against an outsider. People on opposite sides politically will happily join together to cheer their favorite sports team. Democrats and Republicans may hate each other over tax rates, but they could at least get together when it came to countering the Soviet Union. And China's economy is going to come to dwarf the USA over the next 50 years given their 3.5+X our population. China remotely approaching per capita GDP parity with western nations and the USA will trigger a major change in attitudes and activities domestically if history is any guide.

Just imagine the scenario in 2026, 5 years after China's GDP passing the US's for the first time according to this forecast: http://www.economist.com/blogs/graphicdetail/2014/08/chinese-and-american-gdp-forecasts and Americans have seen 17 years of stagnation at 2% real GDP growth (which assumes we dont even have another recession, which we will). China's continuous acceleration above us will not go without some sort of response IMHO. And there will be nothing to respond with other than fiscal policy, which will force more in paradigm thinking and action.

I vacillate between hope and despair, at least this one random thought about China gives me some hope for a while, at least until I read the next daily kos article slurping up Krugman's heaping pile of Bull$%^& and loudly proclaiming how awesome his a#$ tastes just because he's on Team Dem and calls out the conservatives for being even bigger idiots than he is.

lastgreek said...
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lastgreek said...
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lastgreek said...

Just imagine the scenario in 2026, 5 years after China's GDP passing the US's for the first time ...

Not being snarky, AP :) ... but you think they'll move up the Social Progress Index a few rungs by that time? They're currently in 92nd place, ahead of Kyrgyzstan and behind Morocco.

And here is a scenario, albeit an implausible one -- if the West (especially the US) were to open its borders to the Chinese, how many you reckon will come over? ;)

You remember some years back Jim Rogers making a big thing about moving somewhere close to China (Singapore?) because it was the smartest thing to do? He acted as if the US was being foreclosed or something. I'm embarrassed to say that back in the day before I had a clue about MMT (and, btw, I learned from people like you), I thought Rogers was one of the savviest investors around ... like that guy Paulson. :(

Apologies for the deletions -- twice forgot the html tags

Unknown said...

lastgreek-

But Americans arent smart enough to care or know about some "social progress index", they only care about the big headline numbers like GDP. And China's economy will be twice the size of America's in no time (decades). Murricans dont like playing second fiddle with stuff like that, but being way down the list in things education, access to health care, poverty levels, etc those things are irrelevant to the ugly american population