Financial Crisis is 'structural adjustment" for 1st world nations

Is the global economic crisis a manufactured opportunity for a "structural adjustment" of 1st world nations? Asere at Malcolm X Grassroots Movement (MXGM) explores the economic and human rights consequences in an essay entitled "The Hold Up."

Now that the financial bubble created by the big banks and Wall Street has burst, leaving people confused and disoriented from the shock, the "cartels" have succeeded in shifting the responsibility and consequences to taxpayers, nationalizing their debt/risk through passage of the unpopular 800 Billion bailout known as the Housing and Economic Recovery Act of 2008.

The big banks and investment companies created the financial crisis when they began the criminal practice of valuing debt/risk as assets and selling the bundled debt as "securities" to global investors. The current seismic financial shift will maneuver the affected communities closer to the financial condition of the world's poor majority, lowering their standard of living. The cycle of debt, dependency and indentured servitude is keeping the world enslaved to the global banking system (IMF, World Bank) that takes its orders from Washington and the other nations of the G7.

Many in the global north (North America, Europe, Scandinavia...etc) have no real concept of the conditions that exist in the global south, in the slums of Haiti, India, Philippines, Indonesia, Latin America, Africa... etc. Now the global North are realizing that they too are at the mercy of the policy makers who, aligned with the richest 1 percent are "centralizing" the global economy, consolidating economic power and redistributing the wealth. In the U.S. the target is the working class gains made during the decade following the October 1929 stock market crash; such as the social security act, the minimum wage, unions (National Labor Relations Act of 1935) and the 40 hour work week. "Today all these social and economic gains are under attack."¹ So structural adjustment has come to the the U.S. and the global north.

Structural adjustment has been a part of U.S. policy in Latin America, the Caribbean, Africa and other "developing countries" since the 1950s. In Haiti the Clinton administration demanded as a condition of restoring Aristide to power (after a U.S. supported military coup) the implementation of a structural adjustment program -- to the detriment of the Haitian people.

For decades, two sometimes divergent, sometimes convergent streams of U.S. policy have played an influential role in defining the economic and political system of Haiti, the poorest country in the Western Hemisphere. Economic policy has steadily supported the interests of U.S. investors and exporters. U.S. political interests in Haiti have been less unified, careening between support for democracy and development and traditional U.S. collusion with the elites and the military. Too often, the interests of the Haitian people, who live in the poorest country in the Western hemisphere, have been sacrificed for the imperatives of Washington policymakers.

U.S. Policy in Haiti by Lisa A. McGowan

The failure of U.S. foreign policy is evidenced by the global financial crisis. And the feeding frenzy of these "gangstas" on the developing world's resources could not be stopped at America's shores. The U.S. controlled global banking system is now feeding on U.S. communities. The U.S. is in the process of becoming the "banana republic" that it has so long ridiculed in "developing countries," while supporting fostering the cruel system through its promotion of structural adjustment programs.

"The greatness of a nation is not measured by the height of its buildings or its steel output or its military might but by these three factors:

1. the rights and opportunities it extends all its citizens, especially the lowliest

2. the manner in which it absorbs and responds to the criticism of its citizenry and the world

3. the willingness and ability of its citizens to question and actively resist the propaganda of that nation's elites ... "

More of the essay here. at Charles Hugh Smith's website

Further info:
¹History shows potential for mass struggle by Milt Neidenberg
The Shock Doctrine - Naomi Klein
Dismantling the American Dream - by Kenneth Buchdahl
Life And Debt (2001) - Documentary directed by Stephanie Black

Speak Softly: John McCain Carries a Big Stick

What did McCain really mean during the debate last night when he said that he identified with his hero Teddy Roosevelt who said, "Speak softly and carry a big stick?"

"Big Stick Ideology, or Big Stick Policy, is a form of hegemony and was the slogan describing U.S. President Theodore Roosevelt’s corollary to the Monroe Doctrine. The term originated from the phrase “Speak softly and carry a big stick; you will go far,” a West African proverb. The term is used to describe the foreign policy of the U.S. At the time, Roosevelt claimed the U.S. had the right to oppose European actions in the Western Hemisphere. The U.S., he said, also had the right to intervene economically and militarily in the domestic affairs of its neighbors if they proved incapable of maintaining peace and sovereignty on their own. The U.S. has Stick diplomacy several times, particularly during Roosevelt’s presidency and when the nation wanted to build a canal across Central America."

Bid Stick Ideology
Wikipedia

Traditionally, U.S. politicians have used the "Big Stick" phrase to indicate reactionary U.S. foreign policy in the Western Hemisphere. Now, with the advent of the so-called Bush Doctrine of preemptive war, a new, more expansive role is assumed by the U.S. that calls for geopolitical transformation. This new world view is articulated by the small group of right-wingers who formed Project for a New American Century.

During Bush Sr.'s administration, members of PNAC advocated the outright invasion of Iraq ("the first battle of the fourth world war" --James Woolsey of PNAC), seizure by Israel of the West Bank and Gaza Strip, and the toppling of the governments of Syria, Lebanon, Saudi Arabia, and Iran.

PANIC's (sic) principle commitment is "dedicated to building up the power of the United States to unparalleled levels." Many of the PANIC men (Dick Cheney, Donald Rumsfeld, I. Lewis Libby, Paul Wolfowitz, Zalmay Khalilzad and Elliot Abrams) came to hold positions of power and influence in George W. Bush's administration.

"The new National Security Doctrine suggested that the U.S. had the right to discourage other nations from building up their military power and could act "to dissuade potential adversaries from pursuing a military buildup in hopes of surpassing, or equaling, the power of the United States." This included the new explicit policy of "pre-emptive" war whenever the U.S. feels threatened: "America will act against such emerging threats before they are fully formed." What is more, the new American edict told other nations that the conservative economic objectives of the Republican Party were policies that should be implemented throughout the whole world. The list included the following requirements: "pro-growth legal and regulatory policies to encourage business investment, innovation, and entrepreneurial activity; tax policies-particularly lower marginal tax rates-that improve incentives for work and investment... strong financial systems that allow capital to be put to its most efficient use; sound fiscal policies to support business activity... and free trade that provides new avenues for growth and fosters the diffusion of technologies and ideas that increase productivity and opportunity."

This new foreign policy was the basis for the speech that Bush made to the United Nations in September of 2002. He told them that the United States was ready to go it alone in the world if the U.N. did not join his preemptive war. The U.S. would take any action that it deemed necessary, against Iraq or anyone else. His administration was making preparations to act quickly and decisively by shedding its various multilateral constraints.

Robbing Us Blind
by Steve Brouwer

PANIC's quest "to accept responsibility for America's unique role in preserving and extending an international order friendly to our security, our prosperity, and our principles" has no doubt been primarily responsible for the deregulation, privatization and trade policies that are currently negatively impacting the world financial markets.

John McCain appears to be pulling back from this "total world domination" doctrine for a nostalgic time when U.S. foreign policy operated undercover, so to speak. The "Big Stick" corollary for John McCain is to use his mate and running mate to personally attack his opponent Barack Obama as McCain attempts to climb back up in the polls.

It is ironic that the Monroe Doctrine's purpose was to prevent intervention in the internal affairs of Latin American countries by Europeans. What it really did was give the U.S. "justification" to intervene and "police" Latin America. The Roosevelt "Big Stick" corollary sought to justify U.S. intervention whenever the American government thought it was necessary.

For Haitians, this intervention saw their democratically elected president isolated by an aid and loan blockade, and ultimately the Haitian president was intimidated and kidnapped. Haiti was declared a "failed state", facilitating a brutal UN military occupation.

When you look at the world economic crisis that has resulted from the U.S. doctrine of "total world domination", the instinct is to say--how the mighty have fallen, on their big stick.

US "Tapeworm" Economics Causes World Financial Crisis

A pre- 850 billion bailout analysis of the American economic system written in February 2007 makes the point that we will change nothing unless we "change the way money works in our personal lives, our communities, and our world." The author Carolyn Baker credits Catherine Austin Fitts as the one person "on earth who has... clearly articulated the way sustainable and unsustainable economic systems work." Ms. Baker teaches history to college students and has written several books. She believes that US presidents have little influence and control over the American economic system, which she terms the "neo-liberal tapeworm" that feeds on its host (the U.S. citizen) and the world.

Naomi Klein, who wrote the book "The Shock Doctrine: The Rise of Disaster Capitalism." thinks that the current economic crisis and bail out is the "shock" that will prevent a president Obama from instituting the changes that his campaign is promoting; such as new sources of sustainable energy, universal healthcare, an overhaul of the education system and middle class tax relief.

"Tapeworm” is the name Fitts applies to the economic system of the U.S. which seeks to feed upon both its inhabitants and its neighbors, near and far, and at the same time, ingest them with toxins which cause them to crave the very elements which feed the Tapeworm, thereby establishing a perpetual search-and-destroy economic system. Inherent in Tapeworm economics is the primacy of centralized financial systems such as the Federal Reserve, national and worldwide banking networks, a complex global economic apparatus, reliance on agribusiness for food supply and distribution, and the privatization of resources—all without financial transparency or accountability.

Conversely, a sustainable economy is de-centralized and locally-focused, relying on small, well-managed local banks; food supplies which are grown, financed, and distributed locally; community ownership of land and resources; local commerce and industry; and above all, financial transparency.

Among the myriad advantages of categorizing economic systems in this way is the immediate exposure of federal election campaigns as unequivocally by, for, and about centralized financial systems which offer the illusions of “choice” and “change”.

No sincere proponent of a sustainable economy has the slightest possibility of emerging victorious in a country where centralized financial systems furnish, finance, and in the current milieu, manage electoral outcomes. Or as Aaron Russo’s documentary “America From Freedom To Fascism” underscored, voting in a national election is essentially making a choice between two crime families who are ostensibly at war with each other but will always join forces when their mutual interests are threatened.

Barack Obama has taken an active part in supporting the unpopular bailout of Wall Street to the tune of $850 billion dollars, so it should come as no surprise that the very same Wall Street firms to benefit from the bailout are the top five funders of the Obama campaign. OpenSecrets.org lists the top five Obama contributors as Merrill Lynch, Citigroup Inc, Morgan Stanley, Goldman Sachs and JPMorgan Chase & Co. The organizations themselves did not donate , rather the money came from the organization's PAC, its individual members or employees or owners, and those individuals' immediate families. Organization totals include subsidiaries and affiliates. The same top five contributors are listed for Senator John McCain.

Unfortunately, the bailout did not include measures to help middle class Americans; such as a moratorium on foreclosures, mortgage relief and restructuring and bankruptcy relief. The U.S. government is complicit in giving Treasury Secretary Paulson and his cronies on Wall Street a blank check and very little transparency and oversight to stop them from further theft and mismanagement. The very people who have exploited the system have been rewarded and are set to use this bailout as a windfall that will cover more risky investments and their assets.

The Baker article maintains:

If we attentively read United States history, we learn that particularly in recent times, financial systems, not presidents, dictate policy and that “Chief Executives” are themselves at the mercy of those systems--before, during, and after their term of office. Electing presidents changes little, but changing how money works changes everything.

Indigenous People Respond to the World Financial Crisis
An article in the Mohawk Nation News uses the parasite analogy to describe the U.S. economic system and its precipitous collapse, suggesting the necessity for revolutionary change:

"The public is crying out for major change to end the colonial racist greedy system. They have to look at Indigenous culture and harmonize their society with ours to survive. They need to renew all their arrangements with us to live, think and govern themselves so that the parasites are pushed aside. Sacrifices are necessary or humanity will destroy itself.

There is another world, a world of resistance. Our fate rests in our own humble hands. Indigenous people have survived. We kept our philosophy, our notions of governance, our duties to mother earth and our way of life which was terribly damaged. We have been able to resuscitate it and bring it back to a healthy life. We all have our strengths. We have an enormous evolved consciousness. People are beginning to see through this capitalist fraud.

Do U.S. President George Bush, Republican candidate John McCain and Democratic candidate Barack Obama want to really re-arrange the economy and society on a new basis? Do they want to dig up the roots of the colonial past and harmonize relations with the Indigenous people and mother earth?"

Ms. Baker writes that the "neoliberal tapeworm" is also being rejected in Latin America in countries like Venezuela, Bolivia, Chile, Ecuador, and Nicaragua for more sustainable economic systems. In Brazil, Senator Eduardo Matarazzo Suplicy sponsored "Citizen's Basic Income" legislation. In their book "The Ethics And Economics of the Basic Income Guarantee", Karl Widerquist and Michael Anthony describe Brazil's basic income law. A citizen in Brazil has the right to a basic income and to contribute to that developing nation building "a just and civilized society." Interestingly, in the U.S., Alaska has a guaranteed income in the form of the "Alaska Permanent Fund" which provides a guaranteed income to all of Alaska's citizens. This economic instrument is also being introduced in Iraq as an oil shares "dividend" to be distributed to Iraq's citizens.

Ms. Baker theorizes that an economic transformation must take place in the United States in order for humankind and the ecosystems to survive beyond the age of oil

"It first begins with a commitment to financial literacy in concert with sustainable economics.

Next, one must increase one’s learning curve regarding the reality of corruption in the United States. American “exceptionalism”, the puerile illusion that other countries are corrupt, but the U.S. is not, must be shattered...

As a result of this recognition, it then becomes crucial to illuminate corruption and Tapeworm economics in one’s own community, i.e., narcotics trafficking, fraud, entities such as universities, foundations, churches, non-profit agencies, and media that accept contributions from the Tapeworm and serve its interests...

...we have no business depositing our money in Tapeworm banks or using credit cards from those institutions. It is our responsibility to transact with institutions that keep the money in our communities, rather than drain it out...

Understand that personal debt finances the Tapeworm and ensures its continued success. Get out of debt, and if you must use credit cards at all, pay them off in full monthly... Investigate people-to-people lending arrangements such as those found at www.prosper.com.

Become involved with other activists in your community to block the privatization of land and resources and demand public ownership of them.

Recognize that “socially responsible investing” usually isn’t. Consult the Solari website for investment opportunities that genuinely promote sustainability while bringing an optimum return.

Consider investing in precious metals—silver or gold, and consult the Solari site for ways to begin doing so with small, affordable amounts. If you deposit money in a savings account, why not invest some of it in precious metals instead?

If we attentively read United States history, we learn that particularly in recent times, financial systems, not presidents, dictate policy and that “Chief Executives” are themselves at the mercy of those systems--before, during, and after their term of office. Electing presidents changes little, but changing how money works changes everything.

Update 10.22.08
I have the wrong link for Barack Obama's top contributors. Obama's top contributors are here. I mistakenly have John McCain's top campaign contributors instead. I regret the error.