Excesses of liberalism in 2010

 

May 3, 2010

we put on line an extract of version 2 of the site fileane.com, which is in the course of drafting. This extract is drawn from part 2: the operation of the systems of being able

 

5.5 To show that the company of domination of financial oligarchy succeeded in dominating the states through the crisis of 2008 and that it succeeded in overcoming the failure of 1929 thanks to new data-processing technologies of communication but that the crisis of 2008 places to us in front of a choice of company.

The traditional diagram of the economic growth rests on a harmonious progression between demand and offer. Liberalism modified the conditions of the offer by delocalizing this offer in countries at low cost of labor and by creating unemployment in the industrialized countries by the suppression of employment. Vis-a-vis this change of strategy of the producers, the states once more were called with the rescue. But it was a frightening trap which we did not leave. While exploding the welfare expenditures of unemployment and social security owing to the fact that the contributions are not sufficient any more, of the fact also of tax avoidance by the large companies and the multinational groups, the only possible answer was the rise of the debt of the households. We know that to counter this risk, certain financial experts found the solution of the risky real loans owing to the fact that the borrowers probably could not refund the house. We are here in the scandal of the subprimes. In April 2010 we know that the direction of Goldman Sachs knew this strategy perfectly is that voluntarily it tried to steal its own customers in their selling these corrupted financial products. In 2009 the states poured enormous liquidities in the monetary circuit. Once the households were saturated with debt, financial oligarchy attacked the public deficits of the most fragile states.

We find here the old dilemma of the years 1920: to sell the production of the industrialized states which are already equipped, it is necessary to sell with the states in the process of development. In the years 1920 this risk was not taken because the insolvency of these states was crippling. This lack of outlets of capitalism was finally translated in the crisis of 1929 because the only immediate possible richnesses could not come any more but from the stock exchange speculation. As of the years 1920, European agriculture has to face the productions of the countries of South America, Brésil and especially Argentina whereas it was itself in surplus production capacity of production compared to the solvent request (of course not in surplus production capacity compared to the real request for food goods throughout the world for éradiquer the famine and it badly nutrition). The consequences of the agricultural crisis in Europe after 1920 are known, mainly in Germany and Bavaria when the rural populations are reflected to support and elect the socialist national party, the Nazis whereas the cities were still divided between republicans and Socialists, Communists. This disastrous political answer cannot hide the economic absence of answer to differently harmonize the markets than by the destruction and the elimination of certain producers and consumers. The crisis of 1929 was amplified by the will of the states not to create new liquidities because of the doctrines orthodoxe monetarist. Only, the history testifies some unfortunately, the production of the armament and the preparation of the war could give again work with the former unemployeds. This economic conflict was used by the ideologists of the fascistic parties and extremists to produce a world military conflict between systems of being able. These last years, the use of data processing makes it possible to find other solutions because the markets are now managed in real time and are inter-connected what makes it possible to pass easily from a market to the other. When a market collapses, it is possible to transfer these financial operations on another market without awaiting the resumption of the economy in particular through the increase in production for ends of war. Still it is necessary that the other markets are healthy and offer fast enrichment appropriatenesses what is not inevitably any more the case considering the general imbalance which settles through the exchanges between the production and consumption. But the frequency of the crises of capitalism since the years 1970 shows that the financial ones are not blocked any more as in 1929 by the political decisions. Data-processing technologies enable them to create themselves their financial markets generally completely disconnected from the real economy, time that the real markets become again of the preys for their speculations. There remains the crucial question today: in 1929, they are the politicians with theories orthodoxe monetarists which blocked the system and transformed simple a krach stock exchange into a world-wide crisis. Today, with the data-processing networks, this blocking on behalf of the politicians is not possible any more and since 2007, the current crisis court from one market to another: loans on real property (2008), speculation on currencies (dollar newzeland in 2009), speculation on the public deficits of certain countries, speculation against the euro in 2010. Is this less serious than in 1929 or more serious?

When the domestic demand is not able to support the growth, there remains export. But these exports must be bought and paid by other countries. The European union is confronted with this problem when states like Greece, Portugal or Spain, the countries of the Mediterranean, to raise their standard of living and to reduce their variation with the countries of the north of Europe, were involved in debt considerably to buy goods of equipment and consumer goods to the industrialized countries of North. On the theoretical level these economic and financial flows are coherent: the economic purchases of goods in the countries of the north of Europe support exports of these countries and their growth. Still is necessary it that in the countries of the South the interior production of richness allows the refunding of its debts through also of exports towards the countries of the North or by entries of currencies thanks to tourism for example, without forgetting most important: assistances of the European union to develop the country and to arrive at the level of the other Member States. We know that these assistances especially benefitted with the companies, i.e. the owners of the means of production, and populates it was not given these aids to improve its living conditions. This question of the appropriation by richest of the assistances granted by other countries or other international institutions is traditional kind. In France, after 1945, it was the same case: the assistances of the Marshall plan finally accepted by the authorities especially financed great work of rebuilding and other great work not always necessary considering the emergency state, which allowed the industrialists and the large companies of public works to collect these assistances and to find the ways of fortune. In 1954, the Pierre abbot had criticized this policy which completely forsook the social housing and the framework of everyday life of the population. This interior imbalance with the profit of richest and some companies does nothing but worsen the imbalance of trade which these countries undergo. 

On this question, since 1920, no economic policy progress or financial was set up to solve this kind of imbalance. The ones produce, the others consume without producing and this fundamental economic imbalance can continue only in only one condition: the maximum enrichment of the producers and financial of the rich countries until this system of exchange ends up causing a crisis. In theory it is possible that the exchanges between country of North and countries of the South continue without the weight of the debt of the countries of the South not posing problem and on the political level it is then a question of erasing the debt of the countries of the South to find the fundamental operation of the economic system: a relation gaining gaining between the countries of the South and the countries of North. The monetary problem is then secondary insofar as the countries of the South develop their economies to create they also new longer-term richnesses. The benefit exists long-term in the suppression of the war risk, the risk of clandestine immigration, the risk medical, demographic, etc But in the current financial crisis this traditional operation in which the risk remains measured in the long run, is the attack object of the financial speculators in the very short term. It is enough to take pretext of the public deficits which increase considerably in the countries of the South to observe the basic rules of finance and to consider that these countries become insolvent on the financial level. Consequently these countries will have to continue to borrow frominsupportable rates high to hold their expiries, which all the more digs their deficits until the ruin of the country which becomes possible on the financial level. The financial capacity thus comes to dominate the political interests to claim its share of immediate profit.

The weak point of the current situation rests of course on a lack of solidarity at the beginning of the installation of this system of exchange between country of the North and country of the South because imbalances are foreseeable. The producers of North seeking only their maximum profit and the politicians being occupied with their electoral tasks, did not set up measurements of transformation of the companies of the South to support their integration in a common standard of living within the European Community. There are well a political error or a gap which makes it possible financial oligarchy to put the states at the foot of the wall by requiring the refunding of the authorized loans. In the case of Greece, the organization of the plan of financing was set up by Goldman Sachs. In April the 2010 evidence is established that these financial institutions deliberately caused the debt of the countries of the South so that they can continue to buy exports of the countries of North and when the level of debt was sufficiently serious, these private financial institutions were then turned over against their customers to require refundings. This bank of business had the same behavior to sell the famous subprimes in the USA. Lehmann Brothers speculated for the fall in the actions Volkswagen and other examples are legions. Even in the event of crisis financial, the best financial ones make juicy deals when the small shareholders and the savers are ruined. What the ones lose goes in the pockets of the others much more qualified on the plan of the businesses and international finance. This situation now known and is denounced even by traders which realize of excesses of this finance which thinks that all is possible considering the sums saved throughout the world do not cease growing bigger. We can one moment put to us at the place leaders of financial oligarchy.

To increase the profits quickly, we use the funds of investment to buy factories in the industrialized countries in order to close them and to delocalize them in the countries at low cost of labor. We know that we increase imbalances throughout the world. There are in this strategy two pillars: on the level of the production, China and the countries of the South-East Asia are the first pillar. On the level of consumption, the United States represents the second pillar: they were always essential to absorb exports and thus to support the world growth. A demonstration was brought at the time of the crisis of 1997. Financial oligarchy was scalded through the crisis of 1997 in Southeast Asia. The funds of pension and the funds of investment had massively brought their money in these countries which were quickly to emerge at the industrial level. Very quickly the American finance companies understood that considerable sums were wasted by the local government and the corruption of the local banking structure. In front of the little of profitability of the placements in these countries, in 1997, brutally the financial circles massively withdrew their money of these countries of Southeast Asia. We know that it is the continuation of the American imports starting from these countries which allowed that this crisis does not become more serious. In light the digging of the deficit of the American trade made it possible to extinguish this fire and this colossal deficit of the trade of the United States up to now does not raise criticism as if it were the privilege of the first world economic power as long as the American imports support exports of other countries and thus their economic growth. These countries of Southeast Asia with weak costs of labor were to be used as a basis of production for the Western countries. We know that China then benefitted from this crisis to replace with the foot raised these countries of South Asia East and to become as from the years 1998 and the signing of a commercial contract with the United States, the formidable base of industrial production for the rest of the world. But the Clinton administration in 1998 thought of exporting massively towards China to find a new balance in its trade balance. We know since the result was exactly the reverse. The problem is that the American debt will finish well a day by being turned over against the interests of financial… and probably also of the rest of the world.

Once the Chinese production equipment functions, it is a question of finding other placements financial able to ensure a strong safety and a profitability. The traditional field of the placements remains the real estate of course. Nearly 50% of the incomes of households are used in the acquisition of residence and the expenditure for the real inheritance. We know today that the financial ones attacked this real market through the subprimes, these appropriations authorized by the private individuals whose financial ones knew that they were for the majority incompetents to refund especially that these same financial with like project increasing the variable interest rates. This speculative strategy made long fire to lead to the financial crisis of 2008 and the blocking of the monetary exchanges between the banks which suspectés the ones the others to want refiler financial titles which corrupted by these irremediable appropriations. In theory, the situation could have been very different: when a house started to be refunded, if the owners do not manage any more to refund, it is possible to seize it to sell it and with this occasion, to carry out a profit. If there remains 70% to refund, the bank can sell the house to 80 or 90% of its original value. This will constitute a good bargain for the purchaser and a profit for the bank. It is theory and this supposes that the new purchaser will find a loan near another bank. Reality was very different with the blocking of the appropriations in all the banks because the bankers did not make any more confidence with the financial ones.

The layer of financial productivity of the households and the loans on real property being compromised, the financial ones must find another target. To free the money markets, the states multiplied the liquidities through the offers of the central banks. This measurement involves a strong risk of inflation. In the immediate future this inflation could benefit the states which have public deficits records because inflation would reduce the weight of this debt. In the second time, this high level of the national debts represents a fault in the management of the states whose financial oligarchy can be prevailed to weaken the economic power of the states. We are here in the presence of the doctrines néolibérale which seek to remove the public services and the intervention of the states for privatiser the whole of the household expenses. With respect to the states the strategy is double: to oblige the states to finally show solidarity between them so that the countries rich and producing, exporting, finance the refunding of the debt of the consumer countries and borrowers. In short that the countries of North pay for the countries of the South. If the first refuse this solidarity, financial oligarchy has all the charts in hand to ruin states and to ensure its domination. Of course the states of North will show finally solidarity with respect to the countries of the South. The development of the policy of integration of the economies of the countries of the South, in particular within the framework of the European monetary union does not raise insurmountable difficulties if there is a real political good-will between members of the community. In the short run, there is no real threat engraves for the states. But imbalance between producer countries and private countries of production not to be more that consumers, will not cease and on the contrary this imbalance will increase. It is thus to move back for better jumping. In the long run financial oligarchy remains convinced that the states will weaken through public deficits dug by welfare expenditures related to the ageing of the population, with the expenditure of health and retirement. Early or late, the leaders of finance think that the states will owe privatiser the welfare expenditures and to put thus fine at the republican pact which dates from the years 1860 and which in France, after 1945 and the installation of the social security, uses a considerable share of the obligatory taking away managed by the State in its objective of redistribution of the richnesses and the incomes. The final objective for financial oligarchy, once the intervention of the states eliminated, consists in imposing to the savers the use of this saving for the consumer expenditure so that through this consumption, the owners of the means of production and the financial ones which hold a big part of this property, can take the hoped profits. The world production can concentrate in the countries at low cost of labor and the financial ones are ensured to always find some share a labor less expensive than the others, the problem consists in eliminating the long-term saving in the consumer countries by obliging the citizens to spend the whole of their incomes. The owners of the means of production and the financial ones which have a significant part of this property are the only ones with being able to grow rich with the detriment by all the others. The process of consumption becomes very simple then: a household works to pay its house which it will have to sell to especially pay its expenditure of end of lifetime if it is in bad health and becomes dependant. Considering the rates/rhythms of work, the stress and the damage of autocratic management to ensure the productivity, the expenditure of health of end of lifetime of the employees are guaranteed. The remainder of the expenditure will be devoted to the education of the children, the food, then with health and the Social Security and if it remains under with the some leisures which the households will be able to offer. Thus the households will not be able to constitute any more a transmissible inheritance with their children, which corresponds well to the definition of poverty and nonthe possibility of becoming rich. For the remainder, richest will monopolize the richnesses of the least rich and will force the latter to draw from their economies, mainly for reasons of expenditure of health and old age or to help more and more their children who undergo professional precariousness if not unemployment. We are into full in the cynicism which constitutes the basic value of the culture and the ideology of the liberal capitalist economic system. In the doctrines of Anglo-Saxon financial oligarchy, we recall it simply here, Bertrand Russel defended the political position that the atomic bomb was to be used to protect the rich countries against the invasion from the barbarians who want to plunder the rich countries once more. We know that the crucial current problem is different and had perhaps not been imagined by the brilliance mathematician: the bombs, even most artisanal, are placed in the middle of our cities, on the aircraft, the parks public, crowd which takes part in festivals, etc… and the barbarians can seize thousands of tons of atomic products which trail all over the world, which remains a pretext for certain American politicians to begin continuation of the preventive wars…

We are there today in 2010. Financial oligarchy has thus finally a serious occasion to eliminate the economic and political power from the states to only remain Master on board destinies of the world.  Europe is the zone of exchanges in which social protection and the public administrations are most important, it is also the monetary area of the euro. In light, it is a speculative layer of first order in the very short term. In the medium and long term, for Anglo-Saxon financial oligarchy neo liberal, Europe is also the contrary example with its ideology which it must eliminate so that it cannot be any more one countervailing power in its world domination of the economic system and thus an also political day.

Behind the case of Greece, we find all the ingredients of the discussion in depth which go well beyond a crisis economic and financial and which once more poses a direct confrontation between system of being able and organization in network. The Greek democracy is young, it goes back to 1974 during the fall of the military dictatorship, itself arrived at the capacity to counter a capacity failing and undermined by quarrels with the movements communist and in favor dating from the second world war. From the economic point of view, Greece as the majority of the countries of the South are characterized by an important underground economy which withdraws calculation of the GDP and taxes more than 30% of the produced richnesses. Italy was in a similar case and made efforts to integrate in its economy the activities practiced in an occult way. The underground economy, apart from the traffics of weapons, drug and human beings which are illicit or immoral activities, rests on exchanges of proximity which carry the mark of a certain solidarity to face exclusions of the economic system. They are mutual aid and resistance networks which develop on the traditional rural culture to make it possible to survive categories of people little integrated in the current economic system and the generalization of wage-earning. In the event of major crisis, the whole of the population rocks in these networks of mutual aid. We have the example of the population of Moscow into 1992 which ensured its food in this manner. There is also the case of Argentina in the years 2000 which set up a parallel economy to avoid the consequence of the fall of its currency compared to the dollar. We are thus opposite a problem of change of culture which relates to the whole of a state and a population. To import products to raise its standard of living whereas the taxes are weak, does not make it possible to develop the public investments and work of infrastructures which are at the base of an economic development because this translates quickly by a blaze of the public deficits.  The case of Greece and the countries of the South of the European union in 2010 shows that financial oligarchy cannot any more be satisfied current situation and tolerate countries in which commercial economy and underground economy with the detriment of the finance public of the states cohabit. Financial oligarchy thus attacks these states which do not respect the play of the financial doctrines néolibérale. It is a manner of showing that there is not an other solution only the economic liberalism which does not tolerate the organizations in network and the economies underground.

In waiting of political solidarity between the states to circumvent this major economic obstacle between producer countries and nonproducing consumer countries, the measures recommended by financial oligarchy against the countries of the South are known: suppression of all that touches with the social system of protection of the citizens, reduction of the wages and the number of the civils servant. Into clear elimination of the social system which is the principal national expenditure because of the republican pact. The objective is known: privatiser welfare expenditures to open new prospects for enrichment for the owners of the means of production and the finance companies. It is well the objective of the neoliberalism and wild become again capitalism. The consumers, the citizens to survive will have to end well up paying and working according to orders' of the new Masters of the world who have finally means to grow rich without the limits posed by the states. The rich person are very close managing to make the demonstration with the people that only the law of the enrichment and the freedom of the private property are able to direct and to organize the world. The solution of the intervention of the States would not be whereas source of wasting of the resources and economic policy inefficiency and social. But let us be we still here that on the level of the arguments of the Anglo-Saxon financial oligarchy which has evil to admit that another culture can resist to him. One should not be a soothsayer to know that the populations will behave differently and in the opposite direction of the solutions imagined by the financial ones. A Greek civil servant (or French) who will work less to be paid less will use his working time for a second activity which will be inevitably remunerated through the underground economy. There will be thus less income tax for the cases of the State and more still of underground economy. The financial ones will thus be taken with their own trap and the debts will be able to end only up choking them even if if as a preliminary they will have paid police force and mercenaries to seize the tangible and real properties of the populations which they will have precipitated in poverty. The same applies to the problem of the retirements, as it is in Greece, France or everywhere in the world: to move back the retirement age after 60 years amounts forbidding the populations to have a second noncommercial activity to preserve its purchasing power. It is obvious that beyond 60 years, in particular in France, few employees work and the companies which want to already eliminate the employees of more than 55 years do not have a culture to support this change of the world of work. The citizens are well obliged to understand that it is a question there only of one brutal countable measurement to reduce the amount of their retirement pension and to prohibit the availability and the access to them to exchanges organized in network of mutual aid and solidarity. On the other hand, to leave with a suitably calculated retirement pension at 60 years, even if it is of rising modest, still makes it possible for an employee to have five to ten years to complete odd jobs at his place or for the others, to take part in another type of exchanges in order to improve its living conditions and to prepare its end of lifetime. The retirement at 60 years is also a cry and a claim to leave this economic system finally and to escape from the stress, autocratic management, paternalism and the worst social relations which characterize France among the industrialized countries. After 60 years, the retirement is the occasion to leave the economic system of capacity partly to integrate economic and social networks in which the living conditions are better and answers to our reasons of living more present. We find here the recurring conflict between dominating will of the leaders of the systems of being able and will to cooperate of the citizens to organize itself in interdependent networks. To refuse to take into account these cultural aspects to hammer rational and countable arguments to defend the ideology of a system of being able then becomes the tangible signs of a refusal of the dialog, of an unjustifiable and unbearable political autism which leads to the social explosion of the system of being able. By refuse to take into account the organizations in networks which support our social organization painfully, the leaders of our systems of capacities work them same with their losses. We are here in the middle of our part 4 which will follow on our Web site.

This crisis thus leads us directly to a new fundamental world-wide crisis, with a choice of company and civilization. After the elimination of the systems of communist capacity, Nazi and fascist, the liberal capitalist system arrived to unbearable excesses which it is now necessary to eliminate by leaving our systems from capacities.

 

the continuation of this text will be put on line during the publication of version 2 of the site fileane.com: these texts will comprise bonds hypertexts with documentary resources which make it possible to the reader to deepen such or such point. The text presented here is supported by a press review on the current crisis and other texts already published in version 1 of the site. Each part has its own documentation. Version 2 has for objective to be more concise and of going from the explanation of operations of the systems of capacities and the networks to the practical application of new organizations in network.

 

Home          library            workshops of work