It is quite ironic when one weighs the role of the Bush family in the current economic climate. As has been well described in the book “Confessions of an Economic Hitman” by John Perkins, the use of massive debt to gain control of assets worldwide is an ongoing practice. If you watched the goings on in Greece during the past few weeks you may be unaware of Wall Street giant Goldman Sachs’ original deal with Greece.
The International Monetary Fund and other lenders like the Wall Street “investment” banks are able to take cheap money, lend to it by the Federal Reserve at virtually no interest, and “rescue” other countries by giving them “bridge loans” or bailouts. If you watched the goings on in Greece during the past few weeks you may be unaware of Wall Street giant Goldman Sachs’ original deal with Greece.
The International Monetary Fund and other lenders like the Wall Street “investment” banks are able to take cheap money, lend to it by the Federal Reserve at virtually no interest, and “rescue” other countries by giving them “bridge loans” or bailouts. In true capitalism this “capital” would be used to enhance productivity and actually create value, increasing a country’s productivity so that the loan could be “serviced” and eventually repaid. With the massive debt incurred by these countries, and of course concurrent debt of the major nations like the U.S., along with the reality of shrinking productivity, unemployment, and circumstances including climate change, these debts reach near default status so that massive new debt must be created to bail the countries out. Part of the latest bailout deal in Greece contemplates “privatization” of the country’s actual physical assets, even though these will still be inadequate to service, much less pay off, the massive debt run up by the lenders and the borrowers. Bear in mind that these assets will be purchased with electronic or paper money. Of course as Robert Reich wrote in Nation, none of the funds borrowed have gone to the people of Greece, or even to tangibly increase productivity – they have mainly been used for the profits of the bankers and to stave off defaults of previous loans. One might argue that these loans weren’t “predatory” in the same sense as the mortgages issued to uninitiated and unqualified mortgage borrowers in the U.S. financial crisis, because a sovereign government undertook them, presumably with full awareness. However, the bottom line is that the people of Greece (the world’s first democracy) did not understand the issues involved and have derived no benefit from the transaction; in fact, the country is in the worst fiscal shape imaginable as a result of joining the Euro and taking advantage of “international banking.” And if you watched the news you know that the people voted in a referendum to refuse the current “bailout.” Despite this fact, the deal is being done and this has, in effect, given abstract corporate entities control of yet another entire country. It’s not just Europe or Wall Street either. China is following in the Western mode of capitalism with a highly leveraged stock market. In one month its richest people lost $100 billion – that’s billion with a “B.” What does this even mean? How can this be calculated on an ontological level? This is simply pixels on computer screens; the energy represented by the currency is meaningless. Perhaps most significant, this unbacked and worthless “currency” also controls the world’s most powerful technology companies. In the 1990’s, when our government allowed banks to become casinos by becoming investment banks, actual productivity soared with the development of the personal computer. But after several “bubbles” that popped and cost small investors millions of dollars, the outcome is simply that a very few own shares in the companies that are taking the jobs of millions of humans. I wrote about the fact that “humans are becoming obsolete” in a recent piece on conscious capitalism. Robert Reich wrote about this trend as well in Why Wages Won’t Rise. So if we now contemplate the fact that the technology which makes life easy for a few will ultimately make it impossible for the many who are displaced, and the owners of that technology are corporations controlled by the very few through Wall Street and now the Chinese stock market – exactly who is the dominant species of the planet? It’s not you or me – it’s corporations and those who control them.
The amazing thing is that this has been done with a neat trick – taking control of the currency. Remember that money was simply a means to facilitate trade between people of real items of value. It was hard to bring a herd of goats in exchange for a dozen tapestries (goats from Greece, tapestries from the orient) so traders created coins and then paper money backed by gold which represented actual value. It was President Nixon who took the U.S. dollar off the gold standard and linked its value to the “full faith and credit of the U.S.” – which is a nice phrase but essentially makes the currency simply a measure of how much people believe we will produce. But when so much is produced and serviced by computers and people become irrelevant, who gets the profit? Obviously those who control the computers, print the money, and own shares in the companies that own the technology. Some would call these entities job creators. Others might call them parasites. But the reality can be seen in Greece where imaginary wealth has led to immeasurable human misery.
The abstract value of money has displaced the real humanity that created it. And as we all know, the current debt levels worldwide are unsustainable. Now, do you want to think of something really creepy? Imagine if technology finally makes most of the human race irrelevant; wouldn’t printing money, so that only a select few controlled everything, also make it perfectly reasonable to warm the planet beyond what the rest of the population could tolerate? Those with air conditioning and water could then live well – and the others? .
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