Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts

Tuesday, February 5, 2013

Why It's Still Kicking Off Everywhere



The journalist and writer Paul Mason recently gave a brilliant talk to a large audience at SOAS, London University - based on his book -



 
Our world is changing dramatically. The global economic crisis has given way to social crisis: corrupt and dictatorial politics enmeshed with a global financial elite - and an ever-widening gulf between the haves and have-nots. In 2011 this profound disconnect found expression in events that we were told had been consigned to history: revolt and revolution. In this compelling new book, Paul Mason sets out to explore the causes and consequences of this new wave of struggle. From London to Cairo, Wisconsin to Tehran, he charts the new forms of collective action: fluid networks of agile, Twitter- and Facebook-savvy networks of youthful protesters who understand how power works. The events, says Mason, reflect the expanding power of the individual and call for new ways of thinking about political alternatives, elite rule and global poverty.

http://shiftmag.co.uk/?p=523&oo=41439044 - This is an interesting review of the book, which includes this paragraph:
If we go back to the early 19th century, any idiot could use a printing press, but it took real skill as a writer and business owner to produce interesting, entertaining, informed and well-distributed works. Similarly, and as he should know, it takes real skill for a historian to dig through (still mainly material) archives, and real skill for a journalist to assemble facts through documents and interviews. The internet does create the social network he discusses, and it does make publication and communication not only substantially easier, but completely different in many ways than what came before. But it doesn’t lend creativity, ingenuity, or good organising skills where it didn’t exist before. No matter what the invention – the press, the railway, the telephone – it still needs people of intellect and dedication to do something remarkable with it, and his over-enthusiasm unfortunately brings to mind a quote from Alan Partridge’s recent autobiography: ‘Wikipedia has made university education all but pointless’.

Here's Paul Mason speaking on the Guardian's website:

http://www.guardian.co.uk/commentisfree/video/2012/jan/23/paul-mason-revolts-capitalist-realism-video



The new edition of Paul's book:




Monday, August 13, 2012

Layer 537 . . . A Summer of Sport, and a New Beginning

 .
After four years of regular blogging Oxzen has needed a sabbatical and some time off to refresh, reflect and take stock. It's been an interesting few months. 2012 has been an interesting year.

So what's been occurring?

As far as Oxzen is concerned, since the beginning of April - a great deal of watching television. March was glorious, warm and sunny, but the rain began at the start of April. It rained almost daily throughout April, May, June and July. The wettest spring and summer on record in Britain.

Not that I'm complaining. I'd had some vague idea that the summer of 2012 was going to be glorious and I'd spend day after day sitting and walking in endless sunshine. However, in many ways it was fortunate there was little possibility of spending a lot of time outside. It's been an amazing television summer.

From the beginning of April, and even before that, it was necessary to watch the many hours of live televised coverage of the Leveson Enquiry.

http://www.levesoninquiry.org.uk/

http://en.wikipedia.org/wiki/Leveson_Inquiry

"The first part will examine the culture, practices and ethics of the media. In particular, Lord Justice Leveson will examine the relationship of the press with the public, police and politicians."

This enquiry turned out to be a fascinating carnival of scumbags and professional liars, all rehearsed to the nth degree by their highly paid advisors and spin doctors to find every possible way of avoiding giving truthful answers to the Enquiry's questions, and if all else failed, to simply say, "I can't remember" and "I don't recall".

Leveson was supposed to examine the culture and the ethics of our media, but the use of  words like "culture" and "ethics" in relation to the majority of our predominantly nasty, supine and obsequious media is quite amusing. For "culture" read "the habitual practice of distorting the truth and whenever possible distracting the nation from anything that really matters in our national life". For "ethics" read "willingness to lie, distort, trivialise and smear; tendency to spread alarm, confusion, mystification and fear".

Throughout this spring and summer the government of Great Britain has stuck doggedly to Plan A, with all the obvious and predictable consequences. The 'rolling back' of the State and the trashing of public services has made an appalling and unnecessary economic depression even worse than it already was. The Labour party is not wrong to say that the Tories have been cutting "too far and too fast", but they are very wrong and very guilty in their collusion with the very notion that our public services should have been cut AT ALL.

Any economist with half a brain (ie those who resisted the nonsense of the neo-conservatives and the Friedmanite Chicago School) understands that in a time of recession and a failure of the private sector to invest in the British economy you need to spend MORE on public services and not LESS if you wish to avoid deflating the economy and prevent a recession from turning into a depression. For fuck's sake - we learned that lesson back in the 1930s, thanks to Keynes and Roosevelt.

For some months now we've even had the International Monetary Fund - never a hotbed of progressive liberalism - gently nudging Cameron, Osborne and Clegg towards a Plan B, and the engagement of some common sense in their economic policies. For 'common sense' read 'lack of willful stupidity and ignorance'. Even the IMF, which runs the whole globalised economy hand in glove with the World Bank, recognises that the last thing the world needs is for one its important engines of finance and potential economic growth (ie GB PLC) to crash even further into depression at a time when the worldwide economy needs reflation and growth.

What the IMF may not recognise, however, is that Cameron and Osborne, and their little chum Clegg, are acting out of an ideological conviction that cares little for world stability and economic growth. The limits of their ambitions are to ensure the prosperity of the City of London's financial institutions, and therefore of themselves and all their fat cat chums -  protected, supported and even further enriched in the face of the shitstorm that's already happening.

Contrast this with the more sensible and honest conservative leaders of Europe and the USA (i.e. Merkel and Obama) who have a real concern with the proper long-term functioning of the international capitalist system. For fuck's sake - these European conservatives are even implementing a Tobin Tax on financial transactions. Obviously our Tories will have nothing to do with this tax since it's something their pals in the City have told them they must never do.

Meanwhile the banking scandals have continued, with Barclays being busted for their criminal manipulation of Libor, RBS busted for helping drugs cartels to launder money, and now Standard Chartered busted for their well-paid assistance to Iran to avoid financial restrictions and sanctions. Ethics? In Britain? In Westminster and the City of London? Don't make us laugh.


http://www.guardian.co.uk/commentisfree/2012/jul/25/brand-osborne-is-over-recession

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Now where was I? Oh yes - the summer of television.

Euro 2012 took place between June 8th and July 1st. England, as expected, were pathetic, and were knocked out as soon as they came up against a decent team. Spain, as expected, were the winners, beating Italy 4-0 in the final.

http://www.uefa.com/uefaeuro/index.html


Wimbledon took place between 25th June and July 8th, and ended with Roger Federer's record-breaking win over Andy Murray. Roger's a phenomenon, and almost an honorary Brit. We love his decency, self-control, thoughtfulness, modesty, and of course his brilliance.

http://www.wimbledon.com/en_GB/about_aeltc/index.html


The Tour de France took place between June 30th and July 22nd. Bradley Wiggins and Chris Frome rode brilliantly, and finished in first and second places. Mark Cavendish, the other star member of the first British team to win the Tour, was also phenomenal - even though his team's support for sprint finishes was necessarily minimal, since winning the General Classification was the stated aim of the team. However, Cavendish was strong enough and fit anough by the end of the tour to win a sprint finish immediately before the final Time Trial (won by Wiggins by a mile) and also able to win for a record 4 times in a row on the final sprint-finish stage on the Champs Elysees.

http://www.letour.fr/indexTDF_us.html


And finally - the Olympics. The games took place between 27th July and 12th August. Having been drawn into compulsive watching of the Olympics four years ago by the Beijing opening ceremony, it was anticipated that these 2012 Games in London would also be addictive and compulsive. And so it turned out.

http://www.london2012.com/

http://www.guardian.co.uk/commentisfree/2012/aug/08/london-2012-beautiful-utopian-collective-dream

Bearing in mind that Oxzen is not a sports fanatic, usually watching very little in the way of live football, cricket, athletics, etc, and doesn't subscribe to any premium sports TV channels - it's been a very odd and very enjoyable summer. And there's still 10 days of the paralympics to come. In short, it's been distracting, fascinating, refreshing, relaxing, often exciting, and a lot of fun.

I was about to write something about last night's abysmal and embarrassing Olympics closing ceremony, but on reflection I won't. No point in ending this particular piece on a negative and sour note.

Laters.

...................................

Random tracks of the day, thanks to Media Player:

Papa's Got A Brand New Bag - James Brown
Turn, Turn, Turn - The Byrds
Happiness is a Warm Gun - John Lennon/Beatles
Blues to Elvin -  John Coltrane
Work  -  Bob Marley

Tuesday, March 27, 2012

Layer 532 . . . The Guardian, Banks of Ideas and a Progressive Counterculture




For years I've put up with people going on about my apparent obsession with the Guardian. This has nothing to do with the political stance of the paper. It's more the fact that I have piles of old copies lying around, some of them half or a quarter read, some with articles highlighted in various shades of green, yellow, blue and magenta. (And no - I'm not organised enough to use any thought-out colour-coding  scheme as such - the shades are random depending on which highlighter is closest to hand.)

The point I'm getting to is this. I don't have an obsession with the Guardian - I get enormous enjoyment and stimulation from reading the paper. Every day is like the Saturday and Sunday of the Guardian's "Open Weekend" - there's an amazing feast of brilliant brain food on offer. What's not to like, and to want to keep in a collection? [OK - you can go online and 'clip' favourite articles to a virtual file - and I do that as well - but it's not the same thing at all as having real bits of hard copy. Don't ask why - it just isn't.]

As for throwing away brilliant articles - I've never understood why people would throw away or give away brilliant books, or brilliant DVDs for that matter. Life of Brian? Oh yes - I watched that last week. Threw it away yesterday. Shakespeare? Read it already. Thrown it away. What's not to like about having a fantastic library, or libraries, at home?



And you don't have to be 'an intellectual' to enjoy the Guardian, any more than you needed to be an intellectual to enjoy the Guardian Open Weekend. All you need is to allow good stuff to enter your brain. Take yesterday's paper, for example.

* A front-page story about the latest Tory party funding scandal and cash-for-access to Cameron and Osborne - "Two hundred grand to 250 is premier league - the first thing we want to do is get you at the Cameron/Osborne dinners."
* Four pages on the Open Weekend at Guardian HQ.
* An article on Obama's healthcare reforms being challenged by more than half of the states in the Supreme Court.
* An article on the latest moves to privatise education and to make it 'for profit'.

Plus a wealth of 'Comment' articles by the usual array of brilliant and not so brilliant columnists, plus the editorials, plus the letters page. So what is not to bloody like?

And then there's the sports section, and of course there's G2, which yesterday featured

* A four page Decca Aitkenhead interview with Grayson Perry
* A two page feature on Julian Baggini's 'Heathen Manifesto'
* A column by Ian Martin, who's a writer for 'The Thick of It:

Life under the Tories: don't say you weren't warned
Some of us saw it coming – but it doesn't have to be this way
by Ian Martin
http://www.guardian.co.uk/commentisfree/2012/mar/25/tory-nightmare-dont-say-werent-warned
The anxiety of living under a Tory government is that you're only ever a few days from the next national bad luck lottery draw. You know something spectacularly horrible will be announced next week. You just don't know whose unlucky balls they'll be holding.
Don't say you weren't warned. We told you what the Tories were like, we of the wilted generation, two years ago. We'd seen it all before. We were struggling young parents ourselves in the 80s when Thatcher's deregulation of the market led to class war, video nasties and Bananarama. We told you. You wouldn't listen.
Come on, you simpered, the Tories can't be any worse than that other crate of soft fruit, with the Britpop on their iPods and their impenetrable jargon. And, OK, I too froze in horror when I heard Labour's schools minister Jim Knight announce through his trimmed facial ladygarden that the challenge was "not simply how to divide the cake, but how to grow the cake". They've made him a Lord now, by the way. Presumably for services to advanced metaphor.
This is why we warned you about the Tories. We knew it would be easier for them to deconstruct the welfare state this time round as they spent much of their last time in office loosening the bolts. The print unions and the miners were defeated early on. The rest of the Tory era was spent dismantling a working class power base it had taken a century and a half to build. They had plenty of time. My son was born in 1979, the year Thatcher became prime minister. He was 18 before the Tories were turfed out again.
Local authorities were humiliated, their stock of affordable housing sold in a right-to-buy fire sale, their powers gradually whittled down to bins and dog waste. The Public Finance Initiative, greatly expanded under the auspices of Blair, was originally introduced as a buccaneering Tory programme, an innovative way of "synergising" public and private sectors. In much the same way that partnerships are forged between a desperately broke family and a loan shark.
Look, the reason this government's moving so quickly to divide the NHS into privatised contractual fiefdoms for its mates, and to divert education budgets into "free" schools for its mates' children, is because it can. Resistance has been atomised. Working-class rage, once articulated by powerful unions representing people doing proper jobs, has dissipated. 
There's no hope of reunionising the country is there? You might as well try to unionise comedy writing, and … oh, wait.
I'm a member of two writers unions. One here, and one in the US I had to join for an American gig last year.
If you can unionise joke-writing you can unionise anything. People who do "silly" jobs of the world unite, you have nothing to lose but your chains.
It would be interesting to see how long Westminster could function if the Amalgamated Union of Baristas and Sandwich Fillers called a strike. And the civil servants came out in sympathy. And the drivers and the cleaners and the couriers and the receptionists and the child-minders and, now I come to think of it, the grandparents.
All this guff the government's spinning about choice and the individual: that's what they want. The last thing they want is collective action. They're always sneering about "Guardian readers". Well, we pay our daily sub of £1.20, let's call ourselves a union. Comrades, to the barricades! Or if you're a Times reader, the paywall!

http://writing.ie/meet-the-authors/special-guests/358-ian-martin-and-the-coalition-chronicles-.html

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Coincidentally I'd spent time at the Open Weekend thinking about the cumulative benefits of all those people at the event taking part in all those discussions on such a wide range of subjects - political, social, cultural, educational, psychological, scientific, economic, etc.

In the early part of the last century - pre-television - people used to go in large numbers to meetings of political parties, trade unions and other interest groups. There was true citizenship in action - direct participation in discussion, debate and policy-making. People listened to speakers giving out information and opinions, and had a chance to ask questions for clarification, as well as give direct feedback with their own opinions.

Our politics and our party system is busted, and everyone knows it. There's very little difference between three dinosaur parties full of young and middle aged prats who represent the political spectrum from the centre right to the hard right. There is NO coherent progressive or alternative opinion. And of course there's little or no actual participation by regular citizens. No wonder those of us who wanted to see the back of New Labour had no-one credible or coherent to vote for. No wonder we're stuck with a government of the rich, by the rich, for the rich.

The Guardian HAS to become even more of a focal point for the positive energy of all those who took part in the weekend gathering of the tribes, plus all those who couldn't get there or didn't know it was happening. Back in the 60's - fully 50 years ago - we built a counterculture and a movement. This has to happen again. Glastonbury's fine, but it's not enough. Music isn't enough. We need ideas to shift a moribund culture and kick it into new life. We now have the Internet, email, Skype, Facebook and Twitter to help build links. We are the many - and the one percent are the few. We need a government that's genuinely of the people, by the people, for the people. We've had enough of rule by Westminster and the City.

We need regular gatherings and debates all over the country. We need young people and old people to be involved in them. We need to make connections and we need to form affiliations. The Open Weekend had no particular agenda and no identifiable leaders. It had organisers. It was led by ideas and opinions. Thank goodness.

Television and radio are more or less closed shops - run by professionals for professionals. We need organised gatherings and spontaneous gatherings where people actually talk to one another, learn from one another and enlighten one another. We need to learn the arts of participation and discussion. The Bank of Ideas needs to have branches in all our towns and cities, and the Guardian can surely help with this.

Love Me Do was released on 5 October 1962. This was the first record released by The Beatles, and was more or less the beginning of the Sixties. By the 5th October 2012 at the latest we need to make sure we've organised a 50th anniversary party, which will recognise the beginning of a whole new era and a whole new way of running a vibrant and progressive culture, one in which progressive ideas are as important as they were back in the Sixties. Get on the bus, tune in and turn on.

Knowledge is power. Watch this video

http://www.youtube.com/watch?v=g_fIjX1_gLw&feature=related

http://www.youtube.com/user/freedominfonetwork

http://www.freedominfonetwork.org/

http://www.youtube.com/watch?v=uf5nVk5MU70

*  "Love Me Do" with its stark "blunt working class northerness" rang "the first faint chime of a revolutionary bell" compared to the standard tin pan alley productions occupying the charts at the time. - Wikipedia

Sunday, March 18, 2012

Layer 530 . . . The Questioning of Capitalism, and Culture after the Credit Crunch



There was an interesting piece in the Guardian yesterday which readers of Layer 528 might want to pick up on. It sheds some more light on the state of post-apartheid South Africa, and the reasons why a country that so many of us had such great hopes for is so fucked. You just have to wonder what Mandela and Tutu make of it all. Are they writing about it now? And do their views carry any weight?

On page 5 of The Review, in "The Week In Books", John Dugdale writes about Nadine Gordimer, who was in London this week.
What Gordimer, 88, was keen to talk about was censorship, and a current threat to freedom of expression in her country, which she called "an updated version of the gags under apartheid". 
One element of this is a media tribunal that requires journalists to seek permission before, for example, investigating a government minister's activities.
Then there is the Protection of State Information bill, which clamps down on whistle-blowing. For Gordimer, both moves are designed to shield an ANC elite who have "betrayed all they fought for".

As pointed out in the recent blog, the betrayal took place almost from the outset, and it continues to this day - thanks to the stupidity, greed, selfishness and ignorance of those who were supposed to be the leaders and liberators.

...........................

Also in this weekend's Review is a brilliant whole-page article by Marilynne Robinson, which is almost too depressing to read. The USA, like South Africa, was supposed to be a new light in the world - a beacon of hope which showed the way forward for people to overthrow oppression and colonialism and build a society based on freedom and justice. Instead, it's fucked.

Culture after the credit crunch
The financial crisis has not led to a questioning of capitalism. Rather, hard times have brought even sharper attacks on 'big government'. In the US anything public equals 'socialism'
 http://www.guardian.co.uk/books/2012/mar/16/culture-credit-crunch-marilynne-robinson
Fear is the motive behind most self-inflicted harm. Western society at its best expresses the serene sort of courage that allows us to grant one another real safety, real autonomy, the means to think and act as judgment and conscience dictate. It assumes that this great mutual courtesy will bear its best fruit if we respect, educate, inform, and trust one another. 
This is the ethos that is at risk as the civil institutions in which it is realised increasingly come under attack by the real and imagined urgencies of the moment. We were centuries in building these courtesies. Without them "western civilisation" would be an empty phrase.
Austerity is the big word throughout the west these days, with the implicit claim that what ever the Austerity managers take to be inessential is inessential indeed, and that what ever can be transformed from public wealth into private affluence is suddenly an insupportable public burden and should and must be put on the block. 
Everywhere the crisis of the private financial system has been transformed into a tale of slovenly and overweening government that perpetuates and is perpetuated by a dependent and demanding population. This is an amazing transformation of the terms in which our circumstance is to be understood. 
For about 10 days the crisis was interpreted as a consequence of the ineptitude of the highly paid, and then it transmogrified into a grudge against the populace at large, whose lassitude was bearing the society down to ruin.
Austerity has been turned against institutions and customs that have been major engines of wealth creation, because they are anomalous in terms of a radically simple economics. [See all previous blogs on Disaster Capitalism, Chicago-School economics, The Shock Doctrine and Naomi Klein.]
As a professor at a public university I feel the effects of this. Of course legislators are also state employees, but for the moment they are taken to act in the public interest when they attack the public sector. If they were to tell us taxpayers how they spend their time, fiscal demolition would account for a great part of it. 
The phenomenon is national, indeed global, since every entity with leverage on any other is bringing the same sort of pressure to bear. The countries we now call "developing" have dealt with this for many years – as often as the international financial institutions have decided that their economic houses need to be put in order. Their cultural and political integrity has been overridden whenever these agencies have invoked the supposedly unanswerable authority of economics. And now the west is seeing its own cultures and politics, indeed its modern social history, erased on these same grounds.

[Of course the 'agencies' and institutions referred to here are the International Monetary Fund, the World Bank and the World Trade Organisation.]

It is this supranational power . . . that failed us all in fairly recent memory. It has emerged from the ashes with its power and its prestige enhanced even beyond the status it enjoyed in the days of the great bubble. The instability and the destruction of wealth for which it is responsible actually lend new urgency to its behests. 
This makes no sense at all. Certainly its authority with the public aligns badly with any conception of rational choice, which is supposedly a pillar of this self-same economic theory. It can proceed confidently, and moralistically, in the face of common sense and painful experience because it is an ideology, the one we are supposed to believe was the champion of freedom and prosperity in the epic struggle called the cold war. 
If there was such a champion, might it not have been freedom itself, as realised in the institutional forms of democracy? That is not how the story has been told. We are to believe it was an economic system, capitalism, that arrayed its forces against its opposite, communism, and rescued all we hold dear. Yet in the new era, market economics – another name for the set of theories and assumptions also called capitalism – has shown itself very ready to devour what we hold dear, if the list can be taken to include culture, education, the environment, and the sciences, as well as the peace and wellbeing of our fellow citizens.
The wealth that was once frozen in appreciated value and thawed at the discretion of the owner, in homes, notably, is now, increasingly, liquid in the hands of international financial institutions. 
To project debt forward as the Austerity mongers do is to assume a predictable future economy, essentially a zerosum economy which can only increase wealth by depressing costs – wages, safety standards, taxes – that is to say, by moving wealth away from the general population. This prophecy will fulfil itself as education is curtailed and "reformed" to discourage intellectual autonomy, and so on. The new sense of insecurity, the awareness that the rules have suddenly changed, has a meaningful segment of the population furious at government and desperate to be rid of the institutions that enable a culture of innovation.
In any case, in America an abstraction called capitalism has truly begun to function as an ideology. The word is not included in the 1882 edition of Webster's dictionary, and in the latest Oxford English Dictionary capitalism is simply defined as "a system which favours the existence of capitalists", as the self-declared socialisms of western Europe have always done. 
In contemporary America it has taken on the definition, and the character, Marx gave it, and Mao, and all the pro-Soviet polemicists. This despite the fact that Marx did not consider the United States of his time essentially capitalist. This despite the fact that the United States as a society is structured around any number of institutions that are not, under this definition, capitalist. 
Suddenly anything public is "socialism", therefore a deviancy, inevitably second-rate, and a corruption of, so to speak, the public virtue. If I could find any gleam of intelligence or reflection in all this, or any sign of successful education, I would be happy to admire it, so passionate are my loyalties. Failing this, I am left to ponder again the fact that this post-Soviet America has turned against its own culture and has seen cleavages in its own population that can only rejoice its most fervent ill-wishers. This is an ideal atmosphere for the flourishing of Austerity, punitive yet salvific, patriotic in its contempt for the thought and the values of those of its countrymen who have doubts as to its wisdom, especially if they express their doubts in the press or at the polls.
At very best there are two major problems with ideology. The first is that it does not represent or conform to or even address reality. It is a straightedge ruler in a fractal universe. And the second is that it inspires in its believers the notion that the fault here lies with miscreant fact, which should therefore be conformed to the requirements of theory by all means necessary. To the ideologue this would amount to putting the world right, ridding it of ambiguity and of those tedious and endless moral and ethical questions that dog us through life, and that those around us so rarely answer to our satisfaction. 
Anger and self-righteousness combined with cynicism about the world as he or she sees it are the marks of the ideologue. There is always an element of nostalgia, too, because the ideologue is confident that he or she is moved by a special loyalty to a natural order, or to a good and normative past, which others defy or betray.
The march of Austerity, with all that means, is international. Historically there is nothing new about it. It is an assertion and a consolidation of power, capable of cancelling out custom and social accommodation. It claims the force of necessity. And when necessity is to be dealt with, other considerations must be put aside. We in the west have created societies that, by historical standards, may be called humane. We have done this gradually, through the workings of our politics. Under the banner of necessity it can all be swept away.


Tuesday, March 13, 2012

Layer 529 . . . The Madness of Queen Melanie



One thing you can say about Melanie Phillips - you always know where you stand with her. And where you stand is clearly to the left of her, since it's impossible to go any further to the right. She stands firmly next to the starboard wall of reality, and sometimes beyond it.

Take her column in yesterday's Daily Fail.

http://www.dailymail.co.uk/debate/article-2113576/Infantile-Lib-Dems-cynical-Cameroons-plot-squeeze-middle-classes-dry.html

Infantile Lib Dems, cynical Cameroons and a plot to squeeze the middle classes dry

That says it all, really. You don't need to go any further. Her madness perceives a dastardly plot to "squeeze the middle classes dry" - whatever that means. What's more, the plot is being hatched by those infantile LibDems and their partners - the Cameron-led clique of Etonians and Bullingdon Clubbers - a well known faction of leftists, anarchists and commies. This is the crazy world of La Phillips, which the Mail pays huge sums of money for her to describe. Nice work if you can get it.
Yesterday, radio and TV studios hosted a procession of squirming Lib Dem spokesmen miserably trying to explain to incredulous interviewers the progressive contortions of their proposals for tax increases in the Budget.
First, the Lib Dem election manifesto in 2010 proposed a ‘mansion tax’ on multi-million-pound properties.
When that was knocked back in coalition by the Tories, the Lib Dems proposed cutting tax relief on pensions for higher-rate taxpayers.
When that, too, was greeted with justifiable horror because it would punish the prudent for saving, Nick Clegg came up with yet another wheeze - a ‘tycoon tax’ to ensure that millionaires who legally avoid high tax rates are required by law to pay not less than 20 per cent in tax on their income.
Indeed, the Lib Dems appear to possess a bottomless bran-tub of proposals to ‘soak the rich’. However, the reason for the ‘mansion tax’ was that the realisation had dawned, somewhere in the dim recesses that pass for a Lib Dem brain, that taxing wealth-producers until the pips squeak means that - surprise - they become less inclined to produce more wealth.
Phew! Let's take a pause to consider.

"Taxing wealth-producers until the pips squeak." In Phillipsland all rich people are 'wealth producers', and any attempt to impose a slightly higher rate of tax on them will make their pips squeak. No matter that most truly wealthy people employ other people to do their work for them; no matter that most wealthy people (eg bankers, landowners, stockbrokers) often never have an original or a socially useful thought in their lives; no matter that most truly wealthy people inherit their wealth and live lives of considerable ease, thanks to their ability to NOT work and to employ other people who do the work. No matter that a slight increase in their tax contributions will have no effect whatsoever on their lifestyles and their wellbeing, let alone make their bleeding 'pips' squeak.

Shall we continue?
That was why Dr Vince Cable decided that taxation should be shifted from income to assets. The idea was that, instead of putting off those actually delivering prosperity for the nation, the state would pounce upon the fruits of their labours. Hence the ‘mansion tax’ on their houses.
There she goes again, insisting that the truly rich are "actually delivering prosperity for the nation", and suggesting that there's such a thing as "the fruits of their labours". As far as the rest of us can see, the City of London, spiritual home of those well-known labourers, "delivered" ruination to the nation, not prosperity. The fact that their mansions were frequently bought in the first place with huge 'bonuses' for crashing the economy doesn't seem to have occurred to Phillips.

Oh well.
The Lib Dem Chief Secretary to the Treasury, Danny Alexander, merely waffled about ‘asking the wealthiest to pay more’. Ah, the dreaded ‘w’-word.
In Lib Dem-speak, ‘wealthy’ seems to mean anyone who is not poor. So their proposals will clobber the many millions struggling along on middling incomes but who the Lib Dems think are the rich who must be soaked.
Here we see the real craziness, or possibly the deliberate evil, in Phillips - since she substitutes 'wealthy' for the word which the muppet Alexander actually used, which was 'wealthiest'. And where is her evidence that in 'Lib Dem-speak' the word 'wealthy' means 'not poor'?
They call this the ‘fairness’ agenda. Well, when a Lib Dem talks about fairness it’s time to take to the hills. For, of course, this is utterly unfair.
Yes, it is right and proper that the better-off should contribute in tax more than the poor. It is the mark of a civilised society for the ‘haves’ to offer a helping hand to those who genuinely have not.
But the fact the Lib Dems totally ignore is that the middle classes and the truly wealthy already do just that.
As we already know, this is complete nonsense. As we already know, the truly rich employ battalions of accountants to figure out how to avoid paying their fair share of tax, as laid down by the laws of the land. Some of them actually go so far as to deliberately evade taxes. Some of them do their banking offshore and use tax havens and anonymous bank accounts to keep their wealth well out of sight and out of reach. None of this is disputed by sane people.

And why is she still banging on here about the 'middle classes' - and trying to put the fear of God and of the taxman into them when she knows perfectly well that the creepy LibDems are merely suggesting that the wealthiest in our society should pay slightly more in taxes - certainly no more than they can easily afford? I think we know why.
This is not fairness. This is grossly unjust. It is also not merely an attack on the rich but a deeply oppressive bullying of the middle-class which, as the Treasury’s cash cow, is already targeted for financial punishment many times over.
"Deeply oppressive bullying"! "Grossly unjust"! "Attack on the rich"! "Financial punishment - many times over"! Either this woman is completely nuts or she's a vile propagandist of the first order. But not a very good one, since her gross exaggerations and distortions will only penetrate the brains of those who already hold such ludicrous opinions, Mail readers, obviously, and have no chance of converting anyone with any sense of reality or sense of social justice to go along with her bonkers way of thinking.
More than 3.5 million people now pay tax at 40 per cent on an annual income above £43,000. To call people earning such sums ‘wealthy’ is an offence against the English language.
So who's calling them wealthy? Not our chums the LibDems.
There may also be an overhaul of council tax, with new bands on properties worth more than £320,000 — again, hardly a ‘mansion’ in South-East England where that kind of money may buy only a modest semi.
True, Mel, but we all know that to have the highest band for council tax set at 320K always was and always has been grossly unfair. Why should someone wealthy enough to buy a million-pound property pay the same as those who can afford £320,000 or less? If we have several bands below 320K then why should the banding end abruptly at that level? There's no logic to it whatsoever. But then the Thatcherite architects of the Council Tax were never interested in fairness or social justice - they were only interested in substituting something - anything - for the hated poll tax.
And then there’s the proposed cut in child benefit for all those earning more than £42,745 — which would further penalise single-earner families while continuing to pay the benefit to dual-income families bringing in £80,000 a year.
This from someone who recently argued in the Mail for the abolition of all child benefit. Not happy about a staged abolition, Mel?
What’s more, those who cripple themselves by independent school fees or who pay for private health insurance are still subsidising everyone else through the taxes to which they contribute such a disproportionate share of their income.
Who says it's disproportionate? They pay proportionately less income tax now than their parents or grandparents ever paid, thanks to recent governments of the right and centre-right shifting the tax burden to VAT, which is the least proportionate and most unfair tax of all, since everyone has to pay 20% VAT on nearly all purchases, regardless of their ability to pay.

And who asked these people, these idiots, to "cripple" themselves anyway? Surely such "crippling" is self-inflicted by people who are wealthy enough to seek what they see as better quality health, education, etc. How come the rest of us can make do with the regular state provision? David and Sam Cameron for example, apparently. Are our hearts supposed to bleed for these poor "cripples"?
These middle-class and wealthy people are, in fact, contributing to the common weal many times over. Yet they are vilified by the Lib Dems and their ilk as social parasites.
Look, Mel. We all know that poor people who have jobs pay proportionately more tax than rich people who have an earned or unearned income. End of.

And when did LibDems EVER "vilify" the middle classes, OR vilify the wealthiest people among us for that matter, let alone call them social parasites? Many LibDems might be rather stupid people, but even they aren't THAT stupid. In fact I think it was the governor of the Bank of England, or possibly the head of the CBI, who said that many merchant bankers are social parasites. Which is quite true, as it happens.
[With] a ‘mansion tax’ the State, in effect, lies low so as not to frighten people away from helping the economy to grow; but when they have actually done so, it wallops them and snatches their money away.
"Wallops"? "Snatches"? Since when is passing legislation to require the wealthiest in society to pay a bit more in what's effectively a council tax "walloping" anyone? And who's going to do this walloping and snatching, anyway? Oh - I do believe it's us - we, the people - who are sick and tired of letting the richest 1% or whatever get away with paying proportionately less tax than the rest of us. For that matter, why should the richest, say, 10% get away with paying proportionately less council tax than people with properties worth £320,000 or less? That's what most of us would call disadvantaging the majority of the middle classes that Mel cares so passionately about, a la Mitt Romney.
So much for the Lib Dems and their politics of envy.
But are the Tories really any different?
Oh, Lord - she's dispatched the LibDems and their politics of "envy" already. Watch out you Tories!
As we all know, the Cameroons’ modernising strategy rests upon being seen to wear on their sleeve hearts that bleed for the poor. The way they have chosen to achieve this is by bashing the better-off. (!!!!!! Is 'bashing' a fit and proper word for such a lady?)
So they kept the top rate 50 per cent tax band for those earning upwards of £150,000 a year. This was purely a propaganda gimmick.
For it rapidly became obvious that in terms of raking in extra revenue it was utterly self-defeating, since the measures people were taking to avoid it actually reduced the amount coming into the Treasury.
This is the usual lie about higher tax rates producing less in taxes, which has been shown to be a lie again and again.
The Prime Minister and the Chancellor reportedly have come to understand that it is not the most brilliant idea to be dumping so cynically on the Tories’ supposed core constituency - the striving and aspirational classes. 
(I think she'll find this is the Tories' ONLY constituency at the present time. Striving is good? Greed is good?)
But they nevertheless still seem fixated on the need to hit the better-off - simply to fend off the accusation that they are ‘toffs’ who would happily see poor children starve in the gutter. Hence the ever-more frantic attempts to trade the 50 per cent tax rate for one of the Lib Dems’ war-on-the-wealthy schemes.
Accusation, eh? How ridiculous. How unfair. We all know that the Cameroons don't want to see poor children starving in the gutter. That's Mel's job already.
Still mesmerised by the false analysis that the Tories can win power only by appearing to be Left-wing, the Cameroons have unfortunately signed up to the manifest absence of fairness in the redistribution of wealth.
Oh sweet Jesus. Lord above. This is getting crazier by the sentence. I'm speechless.
Not only is this unjust; not only does it belittle the striving classes by assuming that all wealth is either unearned or somehow illegitimate; it also breaks off the nation’s middle-class nose in order to spite its own face.
Crazy. Bonkers. She's babbling. And foaming.
For the message the Coalition is delivering day after day is that the Government is anti-business and anti-wealth creation, and that any entrepreneur thinking of investing in the UK needs his head examined.
Speechless. This government has done nothing except pander to the City and the 'Markets'.
With the economy desperately struggling to pull itself out of recession, this takes political stupidity to an epic level.
Well the 'economy' had better pull itself out, since the government is so unwilling to help it, just as these Tories never did or said a thing to help it during a 30 year period when there was no such thing as industrial policy, unlike in Germany - only cheerleading for the City, privatisation, asset-stripping, the Big Bang, deregulation and the bonus culture.
The Lib Dems subscribe to this politics of envy and class spite because - heaven help us - they actually believe in it. The Cameroons subscribe because they think it will win them elections.
It’s a moot point which is worse - infantilism or cynicism. The pantomime horse that is the Coalition unfortunately has one at each end.
As I say, you have to be waaaaaaaaaaaaay over on the extreme political right wing in order to attack the Cameroons for their so-called left-wing policies. Surely cynicism is the stock in trade of politicians, anyway? Obviously Mel would rather the Tories nail their (her) nasty policies to a highly visible mast in order to ensure future electoral success. Good one, Mel. Let's all simply tell the proles they can just fuck off and die, and be done with it.

Is it just me, or is this Phillips person getting crazier as she gets older? Or is she just showing clear signs of early onset something or other? Early onset frothing at the mouth, terminal rabid Mail-syndrome? Maybe it's just burn-out from a long (too long) career as a media rotweiler and arch propagandist. Give yourself a break, Mel. Retire now before it's too late to rediscover - or maybe discover for the first time - some semblance of reality, decency and sanity.

And by the way, dear Oxzen readers, don't forget to read the truly entertaining and hilarious comments of her readers which are on the website below Phillips' column. These are people who didn't just lose the plot - they never had any idea of it in the first place.


Monday, March 12, 2012

Layer 528 . . . Why Are South Africa's Schools Failing Their Pupils? A Lesson From History, and the Shock Doctrine


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There's a distressing story on the BBC website today about the condition of state schools in South Africa and how they're failing their pupils. It's an appalling situation. The story goes on to say that many parents, even those who are not wealthy, are now migrating their children to the 'private' sector in order to get them a decent education. Why is this happening, and can it be changed?

I remember only too well the conditions in the state schools I visited a few years ago on my one and only trip to South Africa - rotten floorboards everywhere, smashed windows and leaking roofs. In many cases there were earth floors, pitifully few books or other resources, and overcrowded classes. But the kids were amazing - so smart in their uniforms, and very eager to learn. It was distressing to see.

Does it have to be this way? Is South Africa such a poor country that it can't afford to repair the broken windows and the holes in the floors in its schools? Apparently so.

But wait a moment - which South Africa are we talking about here? Is it the one where all the pupils are black, and where the schools are situated in blacks-only areas? Too right we are. Because you can be certain that there are plenty of classrooms elsewhere, in a different South Africa, where conditions are very different indeed.

In short, what we're talking about is a multi-cultural country where the real issues are to do with social class, wealth and economics - i.e. the distribution of incomes and the economic policies of the country, which are not dissimilar to those we see in the rich countries that  long ago bought into the 'Washington consensus': 'globalisation', Chicago-school neo-liberal economic thinking, privatisation of public utilities, and the notion of trickle-down economic development. But the money doesn't quite trickle down to the townships and the rural areas - any more than it trickles down to the council estates, the 'housing projects', and the poor rural areas in countries like Britain and the USA.

Naomi Klein explains it all in her brilliant book, The Shock Doctrine.

The really annoying thing about the BBC report itself is its stupid assumption that the problem simply lies with 'mismanagement' and corruption within the school system (though that may well exist), as well as with "a highly unionised teaching profession and low morale":
Nonkqubela Secondary, is struggling with outdoor pit latrines which have fallen into disrepair, while a third of all teaching posts remain vacant.
"We used to have good results, but we are short of maths teachers, science teachers and when staff look at our facilities they decide not to come here," head teacher Khumzi Madikane laments.
He says he cannot blame parents who can afford it, migrating to the private sector. But most of his pupils are dirt poor.
Education in the Eastern Cape is in crisis, and the central government has taken over the running of the department after allegations of corruption and mismanagement.
[An old mate of mine who was working on an EU funded education development project was gently eased out of his post when he took exception to the corruption and mismanagement of petty bureaucrats and middle managers who were more interested in grabbing funds for themselves than passing them along to the schools.]
It is a sad indictment of a rural slice of South Africa which in the past century gave birth to some of the greatest minds in history, including Nelson Mandela and the late freedom fighter Walter Sisulu.
The crisis no longer a dirty little secret, with the government itself admitting that 80% of state schools are failing.
In a recent speech, Basic Education Minister Angie Motsheka revealed that 1,700 schools are still without a water supply and 15,000 schools are without libraries.
But more than 17 years after the end of white minority rule, observers argue that South Africa is struggling with more recent phenomena: Poor teacher training, corruption and maladministration, a highly unionised teaching profession and low morale.
Back in the township, opting for a private school has come with huge sacrifices for Simanye's aunt, Nokwezi.
"I've really had to squeeze myself but it is worth it - in state schools, if they have a disagreement the teachers go on strike," she says.
[Obviously in the private sector the teachers never have any issues they need to address.]
The surge of low-cost private schools shows no sign of slowing down. Thousands of other grandmothers, brothers and sisters are scraping together the funds to send a child to school.
Yet the vast majority of South African children have little choice but to opt for the local state school.
...............................................

The real story here is that in post-apartheid South Africa there is as much inequality as there was during the apartheid era, and probably even more, according to Naomi Klein's researches. Nothing really changed because the economic system runs in exactly the same way as it ran before democracy arrived there. The wealth generated within the country stays predominately within the middle and upper classes, and middle class blacks seem no more willing to pay more taxes in order to improve public services than their white counterparts ever did. Needless to say there's been no such thing as a wealth tax, a mansion tax or any steps taken to ensure that the rich elite don't offshore their wealth to avoid paying taxes. The government's income from taxes has also fallen due to rising unemployment.

What's more, the country is still servicing massive debts that were accumulated by the apartheid regime and which were partly the reason why the National Party decided to do a deal with the ANC and Nelson Mandela - on the grounds that it was better to hang on to their private wealth (even at the cost of giving the vote to non-whites) and hand over the country's debts to a new government, rather than lose their private wealth by going down with a ship that was sinking under the weight of apartheid debt, at the same time as losing the war with the ANC.

Some quotes from Naomi Klein might help to make this clearer - pages 194 - 217 - Chapter 10 - Democracy Born In Chains - The Shock Doctrine
" . . . to be able to send your children to school and to have accessible health care. I mean, what's the point of having made this transition if the quality of life of these people is not enhanced and improved? If not, the vote is useless."
- Archbishop Desmond Tutu, chair of the Truth & Reconciliation Commission, 2001
"Before transferring power, the Nationalist Party . . . negotiated a kind of swap where it gave up the right to run the country its way in exchange for the right to stop blacks from running it their own way."
- Allister Sparks, South African journalist
[Naturally the 'blacks' referred to by Sparks were people like Nelson Mandela - who had declared an intention to nationalise industries and banks - and not the black politicians who subsequently emerged and were interested mainly in doing well out of the system themselves, not changing the system in order to promote greater fairness and equality. Many of the ANC's current politicians are as right wing and neo-liberal in their economic views as New Labour or George Osborne and his chums They have, after all, in many cases been to the same universities and had the same economics and MBA tutors.]
In January 1990 Nelson Mandela sat down in his prison compound to write a note. The note was only two sentences long - 
"The nationalisation of the mines, banks and monopoly industries is the policy of the ANC, and the modification of our views in this regard is inconceivable. Black economic empowerment is a goal we fully support and encourage, and in our situation state control of certain sectors of the economy is unavoidable."
[The ANC's Freedom Charter] enshrined the right to work, to decent housing, to freedom of thought, and most radically, to a share of the wealth in the richest country in Africa, containing, among other treasures, the largest goldfield in the world. 
"The national wealth of our country, the heritage of South Africans, shall be restored to the people; the mineral wealth beneath the soil; the Banks and monopoly industry shall be transferred to the ownership of the people as a whole; all other industry and trade shall be controlled to assist the well-being of the people," the Charter states.
What the Freedom Charter asserted was the baseline consensus in the liberation movement that freedom would not come merely when blacks took control of the state but when the wealth of the land that had been illegitimately confiscated was reclaimed and redistributed to society as a whole. 
If Mandela led the ANC to power and nationalised the banks and the mines, [then] the precedent would make it far more difficult for Chicago School economists to dismiss such proposals in other countries as relics of the past and insist that only unfettered free markets and free trade had the ability to redress deep inequalities.
On February 11, 1990, two weeks after writing that note, Mandela walked out of prison a free  man, as close to a living saint as existed anywhere in the world.
The ANC had a unique opportunity to reject the free-market orthodoxy of the day. Since there was already widespread agreement that corporations shared responsibility for the crimes of apartheid, the stage was set for Mandela to explain why key sectors of South Africa's economy needed to be nationalised just as the freedom charter demanded. 
In the years that passed between Mandela writing his note from prison and the ANC's 1994 election sweep in which he was elected president, something happened to convince the party hierarchy that it could not use its grassroots prestige to reclaim and redistribute the country's stolen wealth. So, rather than meeting in the middle between California and the Congo, the ANC adopted policies that exploded both inequality and crime to such a degree that South Africa's divide is now closer to Beverly Hills and Baghdad. Today, the country stands as a living testament to what happens when economic reform is severed from political transformation. Politically, its people have the right to vote, civil liberties and majority rule. Yet economically, South Africa has surpassed Brazil as the most unequal society in the world.
The talks that hashed out the terms of apartheid's end took place on two parallel tracks that often intersected: one was political, the other economic. Most of the attention, naturally, focused on the high-profile political summits between Nelson Mandela and F.W. de Klerk, leader of the National Party.
The much lower profile economic negotiations were primarily managed on the ANC side by Thabo Mbeki, then a rising star in the party. 
[Later on he would become South Africa's president, and a man who refused to accept that HIV causes AIDS. "A group of Harvard scientists led by Zimbabwean physician Pride Chigwedere each independently estimated that Thabo Mbeki's denialist policies led to the early deaths of more than 330,000 South Africans. Barbara Hogan, the health minister appointed by Mbeki's successor, voiced shame over the studies' findings and stated: "The era of denialism is over completely in South Africa." - Wikipedia]
In these talks the de Klerk government had a twofold strategy. First, drawing on the ascendant Washington Consensus that there was now only one way to run an economy, it portrayed key sectors of economic decision making . . . as [merely] "technical" and "administrative". [i.e. set in stone and unalterable.]
Then it [set out] to hand control of power centres to supposedly impartial experts - economists and officials of the International Monetary Fund, the World Bank, the General Agreement on Tariffs and Trade, and the National Party - anyone except the liberation fighters of the African National Council. [Each of these 'world' bodies was essentially run by right-wing economists, many of whom had been tutored by Milton Freedman and his associates in Chicago.]
This plan was successfully executed under the noses of the ANC leaders, who were naturally preoccupied with winning the battle to control Parliament. In the process, the ANC failed to protect itself against a far more insidious strategy - in essence, an elaborate insurance plan against the economic clauses in the Freedom Charter ever becoming law in South Africa. "The people shall govern!" would soon become a reality, but the sphere over which they would govern was shrinking fast.
"We were caught completely off guard," recalled economist Vishnu Padayachee. When he learned that the central bank and the treasury would be run by their old apartheid bosses, it meant that "everything would be lost in terms of economic transformation". 
From Padayachee's point of view, none of this happened because of some grand betrayal on the part of ANC leaders, but simply because they were out-maneuvered [tricked!] on a series of issues that seemed less than crucial at the time. 
What happened in these negotiations is that the ANC found itself to be caught in a new kind of web, one made of arcane rules and regulations, [how many of us actually have a clue about GATT and IMF rules, regulations and stipulations?] all designed to confine and constrain the powers of elected leaders. As the web descended on the country, only a few people even noticed it was there. As the new government attempted to make tangible the dreams of the Freedom Charter, it discovered that the power was elsewhere. 
Want to redistribute land? Impossible - at the last minute the negotiators had agreed to add a  clause to the new constitution that made land reform virtually impossible.
Want to create jobs for millions of unemployed workers? Can't - the ANC had signed on to the GATT (the precursor of the World Trade Organisation) which made it illegal to subsidise the auto plants and textile factories.
Want to get free AIDS drugs to the townships, where the disease is spreading with terrifying speed? That violates an intellectual property rights commitment under the WTO, which the ANC joined with no public debate.
Need money to build more and larger houses for the poor and to bring free electricity to the townships? Sorry - the budget is being eaten up servicing the massive debt, passed on quietly by the apartheid government. 
Print more money? Tell that to the apartheid-era head of the central bank. 
Free water for all? Not likely. The World Bank, with its large contingent of South Africa based economists, researchers and trainers, is making private-sector partnerships the service norm.
Want to impose currency controls to guard against wild speculation? That would violate the $850 million IMF deal, signed, conveniently enough, right before the elections.
Raise the minimum wage to close the apartheid income gap? Nope. The IMF deal promised "wage restraint".
And don't even think about ignoring these commitments - any change will be regarded as evidence of dangerous national untrustworthiness, a lack of commitment to "reform", an absence of a "rules-based system". All of which will lead to currency crashes, aid cuts and capital flight. 
The bottom line was that South Africa was free but simultaneously captured: each one of these arcane acronyms represented a different thread in the web that pinned down the limbs of the new government. 
[Just as they are now pinning down Greece, and elsewhere.]
A longtime antiapartheid activist, Rassool Snyman, described the trap in stark terms. "They never freed us. They only took the chain from around our neck and put it on our ankles." 
Part of what I want to understand is how, after such an epic struggle for freedom, any of this could have been allowed to happen . . . Why didn't the grassroots movement demand that the ANC keep the promises of the Freedom Charter and rebel against the concessions as they were being made?
I put this question to William Gumede, a leader of the student movement during the transition. "Everyone was watching the political negotiations. When the economic negotiators would report back, people thought that it was technical; no-one was interested." This perception, he said, was encouraged by Mbeki, who portrayed the talks as "administrative" and of no popular concern. As a result, he told me, "We missed it! We missed the real story! And I am so disappointed in myself for being so naive."
If Padayachee is right and the ANC's own negotiators failed to grasp the enormity of what they were bargaining away, what chance was there for the movement's street fighters?
Gumede points out that most people simply assumed that no matter what compromises had to be made to get into power, they could be unmade once the ANC was firmly in charge. "We were going to be the government - we could fix it later."
What ANC activists didn't understand at the time was that it was the nature of democracy itself that was being altered in those negotiations, changed so that - once the web of constraints had descended on their country - there would effectively be no later.
After a decade of ANC rule, millions of people had been cut off from the newly connected water and electricity because they couldn't pay the bills. 
As for the "banks, mines and monopoly industry" that Mandela had pledged to nationalise, they remained firmly in the hands of the same four white-owned megaconglomerates that also control 80% of the Johannesburg Stock Exchange. In 2005, only 4% of the companies listed on the exchange were owned or controlled by blacks. 70% of South Africa's land, in 2006, was still monopolised by whites, who are just 10% of the population.
The ANC, once it became the government, accepted the dominant logic that its only hope was to pursue new foreign investors who would create new wealth, the benefits of which would trickle down to the poor. Once countries have opened themselves up to global market's temperamental moods, any departure from Chicago School orthodoxy is instantly punished by traders in New York and London who bet against the offending country's currency, [we're talking casino capitalism here], causing a deeper crisis and the need for more loans, with more conditions attached [and which, needless to say, are loans only offered at very much higher rates of interest].
Thabo Mbeki had spent many of his years of exile studying at the University of Sussex, and while the townships of his country were filled with tear gas, he was breathing in the fumes of Thatcherism. 
According to Gumede, Mbeki took on the role of free-market tutor within the ANC. The beast of the market had been unleashed, Mbeki would explain; there was no taming it, just feeding it what it craved: growth and more growth. [i.e. profits]
So, rather than calling for the nationalisation of the mines, Mandela and Mbeki began meeting regularly with Harry Oppenheimer, former chairman of the mining giants Anglo-American and De Beers, the economic symbols of apartheid rule. 
The financial press offered steady encouragement for this conversion: "Though the ANC still has a powerful leftist wing," the Wall Street Journal observed, "Mr Mandela has in recent days sounded more like Margaret Thatcher than the socialist revolutionary he was once thought to be." 
Mbeki convinced Mandela that what was needed was a definative break with the past. The ANC needed a completely new economic plan - something bold, something shocking, something that would communicate that the ANC was ready to embrace the Washington Consensus.
Only a handful of Mbeki's closest colleagues even knew that a new economic program was in the works. "All were sworn to secrecy and the entire process was shrouded in deepest confidentiality lest the left wing get wind of Mbeki's plan." 
In June 1996 Mbeki unveiled the results: it was a neoliberal shock therapy program for South Africa, calling for more privatisation, cutbacks to government spending, labour "flexibility", freer trade and even looser controls on money flows. According to economist Stephen Gelb, its overriding aim "was to signal to potential investors the government's (and specifically the ANC's) commitment to the prevailing orthodoxy." To make sure the message was loud and clear to traders in New York and London, at the public launch of the plan, Mbeki quipped, "Just call me a Thatcherite."
[As things turned out] Mbeki's plan failed to attract long-term investment; it resulted only in speculative betting that ended up devaluing the currency even further. [These markets and currency traders are not complete fools: they're smart enough to understand that Chicago School economics are pure right-wing fantasy and bullshit, which will only send their adherents and the policy makers up shit creek.]
Nelson Mandela has cited the [apartheid] debt burden as the single greatest obstacle to keeping the promises of the Freedom Charter. "That is 30 billion rand we did not have to build houses as we planned, to make sure that our children go to the best schools, that unemployment is properly addressed and that everybody has the dignity of having a job, a decent income, of being able to provide food and shelter . . . We are limited by the debt that we inherited."
Despite Mandela's acknowledgement that paying the apartheid bills has become a disfiguring burden, the party has opposed all suggestions that it default.
What makes the ANC's decision to keep paying the debt so infuriating to activists is the tangible sacrifice made to meet each payment. For instance, between 1997 and 2004 the government sold 18 state-owned firms, raising $4 billion, but almost half the money went to servicing the debt. In other words . . . instead of nationalising the "mines, banks and monopoly industry" . . . it was doing the opposite - selling off national assets to make good the debts of its oppressors.
In the end, South Africa has wound up with a twisted case of reparations in reverse, with the white businesses and industries that reaped enormous profits from black labour during the apartheid years paying not a cent in reparations, but the victims of apartheid continuing to send large paychecks [and white pension-fund payouts] to their former victimisers. And how do they raise money for this generosity? By stripping the state of its assets through privatisation. The dismantling of the state and the pillaging of its coffers continue to this day.
More than a decade since South Africa made its decisive turn towards Thatcherism, the results of its experiment in trickle-down justice are scandalous:
* Since 1994 the number of people living on less than $1 a day has more than doubled, from 2 million to 4 million plus.
* Between 1991 and 2002 the unemployment rate for black South Africans more than doubled, from 23% to 48%.
As leaders like Mandela traveled the globalisation circuit it was pounded into them that even the most left-wing governments were embracing the Washington Consensus: the communists in Vietnam and China were doing it. Even Russians had seen the neoliberal light - at the time the ANC was in its heaviest negotiations Moscow was in the midst of a corporatist feeding frenzy, selling off its state assets to apparatchiks-turned-entrepreneurs as fast as it could. If Moscow had given in, how could a raggedy band of freedom fighters in South Africa resist such a forceful global tide?
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And those, ladies and gentlemen, are the real reasons why a great many of South Africa's schools have broken windows, rotten termite-ridden floorboards, leaking roofs and a shortage of teachers. Nothing fundamentally to do with truculent teachers' trade unions or even bad management and local authority corruption. Not really. It goes much deeper than that. It's the economy, stupid. Plus stupidity, cupidity, naivety, rapacity and inequality. Thatcherite indeed! Trickle down!


Thursday, February 16, 2012

Layer 521 . . . Greek Tragedies, The Gods of Speculation, and the Markets

Oxzen has written previously about the world being run by "the markets" (meaning run by the people who control the vast majority of the wealth) and the fact that individual governments seem unable, playing by the current rules of capitalism and globalisation, to do anything except bow down to the power of "the markets". This is true even for massive entities such as the governments of the USA and the EU, which are afraid, very afraid, of "the markets".


This week "the markets" are back in the news, along with their Provisional wing, the credit rating agencies.


Moody's blues: George Osborne's wooing of the rating agencies turns sour
Osborne has been lavishing expensive gifts on the credit rating agencies. But now they have shown their capricious side
by Larry Elliott
http://www.guardian.co.uk/commentisfree/2012/feb/14/moodys-george-osborne-rating-agencies
Credit downgrade alert leaves George Osborne in a political fix
Inflation may be falling but the chancellor has only few options open to him after Moody's credit warning
by Larry Elliott
http://www.guardian.co.uk/business/2012/feb/14/credit-downgrade-george-osborne-political-fix


.....................................................................
As Greece stares into the abyss, Europe must choose
The way out of the financial crisis faced by Greeks requires a choice about what kind of Europe we want
by Maria Margaronis
http://www.guardian.co.uk/commentisfree/2012/feb/12/euro-crisis-stake-greece-identity-europe
As I write, the Greek parliament is preparing to vote on the bond swap agreed with the country's private creditors and on the new deal with the EU and the IMF, which would lend the country €130bn in exchange for cuts that slice the last little bits of flesh from the economy – including a 22% reduction in the minimum wage and 150,000 public sector job losses by 2016. Without the deal, Greece will default by March; with it, the country will sink into a still deeper depression, with no end in sight. In a televised effort to rally the country behind yet more austerity, the finance minister, Evangelos Venizelos, laid out a blunt choice between sacrifices and worse sacrifices, humiliation and still deeper humiliation, if Greece should default and leave the eurozone.
It's not clear, though, how many people were listening. Exhausted by interminable cliffhangers and last chances, many Greeks have turned off the terrorist soap opera of the TV news and are trying as best they can to get on with their lives. The misery to which Athenians have been reduced – the soup kitchens, the homelessness, the depression and suicides, the rising tide of poverty that's swallowing the middle class – is now a staple of the features pages. It's harder to describe the sense of pervasive breakdown that gets under the skin; the feeling of disorientation and lost identity that comes with the collapse of the assumptions people lived by and the stories they told themselves about the future and the past.
When you ask people on the street if they would rather Greece went bankrupt than submit to further measures, many now point out that it is already bankrupt, that public sector workers have gone unpaid for months, that hospitals have no supplies, that the poor are being wrung dry in order to pay the banks.
Why, then, have large sections of the Greek elite clung so hard to the fantasy that a new loan deal can "save" the country? The obvious answer is that default is a black hole and an enormous risk. No one can predict what suffering a default might bring. Another is that the current crop of politicians built their careers in the system that is now unravelling, based on oligarchies, clientelism and corruption; they've proved unwilling to make the reforms that might, in a different global climate, have revived both Greece's economy and its democracy.
The deeper reasons, though, may be cultural and political. The crisis has intensified old splits in Greek society. You can see it in the polls, which show support ebbing from the centre to the edges of the political spectrum, and especially to the fragmented left. You can see it, too, in the historical parallels people reach for in a vain attempt to name this unprecedented nightmare. Protesters chant slogans from the dictatorship of 1967 to 1974, comparing the deal's Greek enforcers with the CIA-backed junta. Both left and right talk about a new German occupation – an understandable reference given that Germany is calling the shots and that Greeks last queued at soup kitchens in the 1940s, but one that can edge into racism or crude exaggeration, as in a recent headline that read simply "Dachau". Both those tropes call up the silent ghosts of the Greek civil war, which launched the cold war in Europe and outlawed the Greek left for the next 30 years. In this story, the west plays the part of the repressive imperial interloper.
For the liberal centre, this is populist anathema. To them Europe is still Greece's heartland and its hope, the only guarantor of liberal capitalism, human rights and democracy.
The trouble with historical metaphors is that they can obscure the present: what's really at stake here is not Greece's identity but Europe's. All eyes are fixed on Athens, but the way out of the crisis requires a choice about what kind of Europe we want. The one we have now, with its deep structural inequalities and its rigid adherence to a failed economic ideology, protects neither democracy nor human rights. Stiff-necked and punitive, it prefers to eat its children.
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Shame on Europe for betraying Greece
Capitalism is triumphant as EU states sacrifice the Greek people in a desperate attempt to appease the gods of speculation
http://www.guardian.co.uk/commentisfree/2012/feb/14/europe-betraying-greece
by William Wall
The behaviour of the EU states towards Greece is inexplicable in the terms in which the EU defines itself. It is, first and foremost, a failure of solidarity.
The "austerity package", as the newspapers like to call it, seeks to impose on Greece terms that no people can accept. Even now the schools are running out of books. There were 40% cuts in the public health budget in 2010 – I can't find the present figure. Greece's EU "partners" are demanding a 32% cut in the minimum wage for those under 25, a 22% cut for the over 25s. Already unemployment for 15-24-year-olds is 48% – it will have risen considerably since then. Overall unemployment has increased to over 20%. The sacking of public sector workers will add to it. The recession predicted to follow the imposition of the package will cause unbearable levels of unemployment at every level.
In addition the "package" demands cuts to pensions and public service pay, wholesale privatisation of state assets – a fire-sale, since the global market is close to rock bottom – and cuts to public services including health, social welfare and education. The whole to be supervised by people other than the Greeks. An entire disciplinary and punishment system.
When we casually use a term like "bailout", it is important to remember that it is not people who are being bailed out, or at least not the Greek people. The bailout will not save a single Greek life. The opposite is the case. What is being "bailed out" is the global financial system, including the banks, hedge funds and pension funds of the other EU member states, and it is the Greek people who are being ordered to pay – in money, time, physical pain, hopelessness and missed educational opportunities. The relatively neutral, even stoic, term "austerity", is a gross insult to the Greek people. This is not austerity; at best it is callousness.
On top of this callousness, we must remember that the strategy itself is nonsense. Every intelligent observer is agreed that cuts do not produce growth. The highest rate of growth in the EU at present is in Poland where massive public investment is driving the economy. GDP is declining or barely moving among the "austerity" nations, including the UK.
In essence, this crisis is a failure of the EU states to show solidarity in the face of an onslaught from the financial markets. At first glance this seems to be a very simple fight. In one corner you have nation states, which have the wellbeing of their citizens as their raison d'être; in the other you have global capitalism as represented by the financial markets, which has the wealth of a tiny few as its raison d'être. But the nation state has, for a considerable time, identified itself with those same markets. States have agreed to see themselves as economies rather than societies. More recently we have been led to believe that the market alone can provide everything the citizen needs and much more efficiently than the structures that the citizens normally rely on and which they have, over generations, erected as protections against the revenge of the market.
This is the triumph of capitalism, that it has persuaded the world that capitalism is the world.
It has led to the undoing of 200 years of struggle between ordinary people and the super-rich. Trade unions didn't appear overnight, they were a response to exploitation. Their defeat has led to the ubiquity of precarious, and now free, labour. Workers are not protected in their workplace by capitalists, they are protected by the laws won by struggle against the capitalist. A sweatshop in China is a direct assault not just on the rights of the Chinese worker but on those of workers in, for example, the UK. Socialist internationalism and solidarity were conceived as a way of defeating that ploy. Old people do not die in the streets not because charity has saved them but because 200 years of struggle has brought us the old age pension and public health. The privatisation of those services is a return to the 19th century. None of this public good would have been won if people had identified with the super-rich of 1812. Now that we have been brought to such an identification, we stand to lose them all over again.
Now we see capitalism at its most triumphant. Greek police beat Greek people in order to impose the will of the banks and hedge funds. The EU member states, including Ireland, are the middleman, the quislings of capital. Rather than reach out a hand of solidarity, we say, "better them than us". As if the global markets will choose to pass on Ireland once Greece has been destroyed. Solidarity is not just compassion for one's fellow man; it is also materialist self-interest. One for all and all for one. We stand or fall together. There is strength in unity.
Instead we have decided to sacrifice the Greek people to the market in the hope that our sacrifice will appease the gods of speculation. We condemn them to misery and poverty to keep Standard & Poor's off our backs. But we have miscalculated. Firstly, the communist left currently stands at 42% in the polls, Pasok at 8%. Pasok (the leading party in government) will vanish and a combination of real leftwing parties will win the next election. They will not bend the knee and put their necks on our block.
It seems to me now that Greece will withdraw from the euro and default on its debt. Who knows what will happen to it then, but it can hardly be much worse than what we want from them, and at least it will be something of their own choosing. The speculators will then take a little time to consider which of the other economies to bet on. Perhaps then the Irish government will regret its lack of solidarity. Whatever happens, our behaviour and that of our EU compatriots has been shameful.
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Greece and the return of the economic 'death spiral'
The lesson of 2008 was that stimulus prevented a new Great Depression. Without similar drastic help, Greece will now default
by David Blanchflower
http://www.guardian.co.uk/commentisfree/cifamerica/2012/feb/13/greece-return-economic-death-spiral
During the latter part of 2008, central bankers around the world worried secretly that the death spiral was approaching. The concern was that it was too late to stop economies crashing. In the event, concerted international action on both monetary and fiscal policy prevented collapse – although they did get pretty darn close to the precipice.
In the UK, then Chancellor Alistair Darling had only a few hours notice that the Royal Bank of Scotland was about to fail. The fear was that cash machines around the world would close, banks would fold and stock markets would tank within hours. This was a once-in-100-year shock: in my view, without such unprecedented intervention, unemployment rates in the US and Europe could well have risen to over 24% – which is where they are already in Greece and Spain.
Stimulus worked, simple as that.
On 9 February, the Hellenic statistical authority, which is Greece's central statistical office, published data on the labor market and industrial production (pdf), which suggests the Greek economy is headed over the cliff. This is a Great Depression for Greece and its 11 million inhabitants.
Without reforms to its product and labor markets, alongside the introduction of a fully-functioning tax system with enforced compliance, Greece has no future and is headed to inevitable default.
The only issue is, how disorderly will it be? It's not so much that the Greeks won't pay, it's that they can't. Greece remains uncompetitive.
For all the deals being signed in Athens and Brussels, the Greek people have worked out that they have no hope; protest and social unrest now looks a rational option to the ordinary people who are bearing the cost to bail out European banks. Cuts in the minimum wage right now are probably not very smart politics.
Greece does still have a card to play – which is "one down, all down". An exit from the euro would result in a depreciated drachma, which would potentially give a much needed boost to tourism. And that sounds better than all other alternatives currently on offer. There is still time for Germany's Angela Merkel to get out her cheque book; but otherwise, it's all over – and quite possibly very quickly.
This really is what a death spiral looks like.
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And talking of tragedies - I give you the Sun newspaper/rag.

The front page yesterday had to be seen to be believed:

http://www.thesun.co.uk/sol/homepage/news/4127833/Whitney-Houston-death-Bath-tub-where-star-died.html

It's worse than on the website.

"Whitney's Death Bath - the First Images."

The bath in the photograph is still filled with the actual water in which tragic Whitney died. The bath photo shares the page with a photo of Whitney looking . . . somewhat . . . drowned.

Just when you think the bottom of the barrel has been well and truly scraped already . . .


But wait!

Also on the website -

40-stone Brenda is Britain’s fattest woman

http://www.thesun.co.uk/sol/homepage/news/4130131/40-stone-Brenda-is-Britains-fattest-woman.html

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I have to end this blog with something good and decent and inspiring.

Robby Krieger: soundtrack of my life
The former Doors guitarist talks about discovering rock'n'roll, blues and jazz and his memories of recording with Jim Morrison
Interview by Hermione Hoby
http://www.guardian.co.uk/music/2012/jan/29/robbie-krieger-soundtrack-my-life

Still love that Crawlin' King Snake by the wonderful John Lee Hooker.

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