I am not blogging about the EU summit. It is pointless. It will of course produce a communique to reassure the markets. It makes no difference.
The economic system in which most of our readers live is little to do with capitalism. The value of goods traded is an insignificant fraction of the flow of funds around the world, much of which relates to either bets on the future values of goods, or bets on the consequences of the vectors of financial flows of which the bets themselves are a part.
The whole edifice is based not on a market for exchange of goods and concrete services, but on an astonishing matrix of state enforced legal instruments creating an extraordinary pile of paper money produced by states, but ultimately worth nothing real. This legal framework was designed to shift the great bulk of this wealth from people who actually work for a living to a small financial elite, most (but not all) of whom create little or nothing real.
If the state compelled everyone to play a pyramid scheme, then you could keep it going for decades. As the system started to reach inevitable collapse, the state moved in with bank bailouts and quantitive easing, both of which simply moved yet more money from ordinary people to the super-rich. In fact the last three years have seen the biggest transfer of resources from poor to rich in human history.
It cannot last, and whether it is Greece or Italy or Spain which is this week’s fashionable media focus is irrelevant. In making these vast levied and leveraged transfers of resources from poor to rich, states have exhausted the capacity of their people to actually pay them. That is true all over Europe, the UK and US. The currency crises are a tiny symptom of a very large impending crash.
That is why I am not blogging about today’s EU meeting or a specific statement of the US Federal Bank Chairman. They are all pissing into the wind that is shortly to be a tornado. I expect before I die I will see a genuine social revolution. I expect that, as always happens, middle class liberals like me will start by being elated by it, and end up being shot by those who seize on the change, to take their turn to use the power of the state to corner resources for themselves.
“I expect before I die I will see a genuine social revolution. I expect that, as always happens, middle class liberals like me will start by being elated by it, and end up being shot by those who seize on the change, to take their turn to use the power of the state to corner resources for themselves.”
And in that you have encapsulated the history of civilisation. It’s not ‘them’ that are like that it’s all of us we just keep deluding ourselves we are different! There is a grand conspiracy in the world – the one of greed which works on/at all levels and was always thus.
Don’t worry, Craig. We won’t shoot you (!)
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Great post – wham bam! says it all.
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‘Oldboy’: Let us catch a glimpse of your own chin, before you start to pass comments on the chins of others. I would suggest that Craig Murray is a veritable duke when it comes to chins. Does yours measure up…?
@ Craig,
This is the crux of the matter:-
” As the system started to reach inevitable collapse, the state moved in with bank bailouts and quantitive easing, both of which simply moved yet more money from ordinary people to the super-rich. In fact the last three years have seen the biggest transfer of resources from poor to rich in human history.”
If the US did not have the world’s reserve currency, the whole house of cards would have long since fallen. To my mind, the US Federal Reserve is doing a sort of Zimbabwe economic solution – simply printing more money in great bundles. Again, if the US did not have the world’s reserve currency, the whole scheme would have already collapsed.
The war in Libya, is a direct reaction to the Gadaffi/AU plan to have launched an all Africa Gold Dinar – gold backed currency. Whiter the US dollar had this happened? Likewise when Saddam signaled that he would henceforth be selling Iraqi oil in Euros and not dollars, once sanctions ended, that too signed his death warrant.
The whole global ponzi scheme cannot last forever. One cannot put something on nothing and expect it to stand; fiat money not backed by tangible production and bolstered by valuable mineral such as gold or silver as a benchmark of tangible value, is like a man having climbed to the 100th story of a building, then stepping off into thin air, with the expectation that the altitude he has reached provides an assurance that he is too high to fall and will be able to be sustained in thin air without solid and tangible support. First, the US economy and then its related interlink to the Euro and European markets, will from a great altitude witness a calamitous fall. Then – hopefully the people will revolt and take power in direct response to the greed and barbarism which brought the entire economic system to the point of collapse.
PS – I believe that this one will be worse than 1929. But, how at this stage can the collapse be avoided?
In the correct order
1: Climate change
2: Global Resources running out
3: Global financial armageddon
Prophesying doom, eh? But why not be imaginative about it? You could demonstrate outside some building whose inhabitants you disapprove of, with a sandwich board, crying “Fallen, fallen is Babylon!”
I couldn’t agree more with your analysis but surely there is still the opportunity to turn the tables and win this one, especially as people in many parts of the world finally seem to have woken up a bit. It’s not even that’s what happening to us is particularly new – the rich elite has been exploiting the developing world for years by getting them into debt before crushing them with ‘austerity’ programmes and buying up their national assets. We need to stand up for social justice and press for some real economic alternatives that can save us from an ever deepening depression. But we have to take a collective stance before the opportunity passes us by.
PS. On second thoughts, better not to make a joke with sandwich boards in this way. After all, some of them might be genuine. Just think, there might have been sandwich board prophets in Atlantis, who did save the souls of a few repentant sinners before the Flood destroyed that world.
“We’re aw doomed… doomed… doomed!” John Laurie.
@Courtenay. You’re in good company. In autumn 2008 I heard Paul Mason, economics editor of BBC Newsnight, tell an audience, ‘This is worse than 1929.’ Around about same time, Paxman in passing—only in passing, mind—called it ‘the cataclysm of capitalism.’
‘OccupyLondon’ – needs you Craig; well said, I mean fcuking brilliant.
“cataclysm of capitalism”
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I think (and it is only my opinion) that the above will turn out to be…cataclysm of humanity.
“This is the neo-Feudalism of which Chris Hedges often speaks. Sure there’ll be some risings and rebellions etc, but these are easily put down, as we’ve seen.”
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why should we doubt this .. after all we’ve had plenty of experience in supporting and directing despotic regimes and their dictators. and of course if we can kill one innocent woman, child or man. we can kill a million ..
“‘OccupyLondon’ – needs you Craig; ”
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where are those fat-cat celebrities .. why arent they down there too .. in reality too obvious to ask i suppose.
james Boswell, I would love to agree with you, because there is still time to change our lifestyles and become more sustainable in our habits and exchanges, but this would significantly undermine the capitalist profiteering and greed, the growth ueber alles merchants who can’t get a hard one without earning a million in under an hour.
A sustainable economy cannot exist in isolation, it takes socially responsible attitudes to long term financing, a financial system that is based on renewable assets, cycles of usage within industries, a financial system that in itself is based on sustainable values that are within the realm of the here and now.
This global financial crisis is down the reluctance to change the system as it had developed, sticking plasters will not bring back the good times, nothing will.
What is sad about this crisis is that not one single Government is willing to prepare its people for the free fall, like the dark forces they represent, we know first when our noses hit the ground. They would not know how to write social responsibility, never mind know what it means and if it hit them on the head, letter by letter.
This blog may be bad, but it does not amount to a capital offense.
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As you say, the problem is not with competitive market capitalism undertaken within an appropriate framework of laws, i.e., laws that prevent monopolies, cartels, enterprises that are “too big to fail” (which is to say always entitled to a bailout at public expense), and laws that enforce compensation for external cost of business including environmental impacts, injury to health, etc.
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Such a competitive free market capitalism has been recognized as the most productive and benign economic arrangement yet devised by all astute commentators from Jesus of Nazareth to that canny Scotchman, Adam Smith.
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Sadly, today’s self-proclaimed liberals rarely argue for capitalism but for bloody useless publicly funded windmills, state-funded abortion, the transformation of education into political correctness training — i.e., the Union of European Socialist Republics, where no one gets to vote on anything serious and what the public are serious about, e.g., getting out of the EU, ending mass immigration to Europe, etc. is blithely ignored.
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(Moderator, this is a modified duplicate of a post just submitted by, which has not as yet appeared. Please delete the earlier remarks if they are still in line for posting. Thank you.)
Follow the money a little further here:
http://www.politics.co.uk/news/2011/10/26/lobbyists-reap-huge-financial-rewards-for-top
Craig, your post is spot on. The people that propagated this crisis made sure laws were changed first, such as the repeal of Glass-Steagall here in the US in 1999. This in large part ensured there would be an eventual meltdown, all it needed was the greedy players – no shortage – and their chums on Capitol Hill and in the White House. The Wall Street “Titans” would become “Titanics” if their parasitic symbiosis with the state/Fed was legislatively finished. This is why I support a full Fed audit and even disbandment. We do not have capitalism, we have crony crapitalism – corporatism. Aided and abetted by the corporate media. (The comment by “David” is spot on, too. I see this happening here in Appalachia.)
Suhayl
You forgot the whole quote from the fondly remembered Private Frazer/John Laurie.
It was more like ‘We’re all doomed! Doomed! I tell ye”.
I think it is possible now to now see how the political battle lines are starting to form, both nationally and internationally.
One senses something very serious afoot. The subject of the blog in itself is an indicator. I can’t think of a government that would have been so determinedly offensive and bare faced in their treatment of the Malyshevs. I don’t doubt previous governments capacity to do something similar but at least they would have blushed when questioned. I suspect there is not the slightest humanitarian impulse within this government.
not sure capitalism is the right choice of words here…..
what we have is cartels, to big to fail, monopolies, and just plain illegal activities, and whilst i think a more suitable name is corporatism, im sure someone could come up with a better one?
capitalism, socialism, comunism all have their role to play in an elightend society.
Aint it amazing that the capitalists have been pofiteering from capitlism in its current ugly form (Wall Street), whilst the risks for their actions are being socialised….. god bless the bankers….
I’m still unsure why playing the stock market in deriatives is not considered gambling?
i know a lady who swallowed a fly. I don’t know why she swallowed the fly. Perhaps she’ll die. Followed by spider, bird,cat,dog etc.
I don’t know why Mrs T swallowed the myth about the banking industry, but the Tory wets who followed, Blair, Brown and Cameron have all been prescribing larger and larger doses of the same medicine. I don’t know why. Perhaps we’ll die.
In the meantime political decisions have changed our world.
To expand the EU, to export manufacturing to the Far East,
to join the War on Terror and now to help the Arab spring in Africa. These changes are sold to us as exporting our values to the rest of the world even if it is at great cost to ourselves.
At the same time we have imported hard workers, superb technology, Islam and the inspiration for revolutionary change.
The creativity of these political decisions is undeniable.
At a personal level, as a native Englishman I can imagine myself moving to Muslim Kurdistan and running my business there with solar products from the Far East. Can you imagine phoning Saddam and asking permission to come over and marry a Kurdish wife?
The West has sacrificed its monopoly on trade, manufacture, democracy, and freedom of speech, admittedly at huge financial cost but also at some reward. I think this is what Mark Golding means by having to lose some of our worst Xenophobic traits.
Mrs Thatcher’s era of sexual liberation also liberates me to pray in a UK mosque. The de-regulation of the banking system, however ghastly, is accompanied by an opportunity for me to flee the tyranny of UK over-regulation of work and business, abroad.
My parents lived in the grey 40′ and 50’s. I do not see that greyness in today’s world, and the sacrifices to remove them have been, and will continue to be, great.
If we’re on the subject of Dad’s Army:
“Don’t oanic, don’t panic!” (Lance-Corporal Jack Jones)
Here’s documentary proof:
http://www.youtube.com/watch?v=ZR6wok7g7do
“…why should we doubt this .. after all we’ve had plenty of experience in supporting and directing despotic regimes and their dictators. and of course if we can kill one innocent woman, child or man. we can kill a million.”
The formbook shows that they are not very efficient. They have been repressing the population of Latin America for generations: death squads, torture, every combination of violence and corruption known to man. And the result has been a steady rejection of the US Empre and all that it stands for (and all who stand for it). There has been some ebbing, as in Honduras, for example where sheer evil currently, but obviously only temporarily, prevails; on the whole though, the movement against imperialism is undeniable. Nothing they can do works. And everything that used to work is now thoroughly discredited.
But the real reason for optimism is that the greedy “elites’ are incredibly stupid. So stupid that they have hacked away the very legs that they have been standing on. The very forces that made them: the middle classes of the imperial metropoles and the labour aristocrats, with their patriotic unions, moderate requests for patronage and flattery, healthcare and education. And their longing to be loved by their betters. And, occasionaly, invited into the club.
Now it is quite clear that the ruling class feels no allegiance to the nations into which its members were born. As Tony Blair put it “We are all Americans now.” By “we” meaning, such as himself, parvenus on the make, looking for cash and unconcerned where it comes from. And by “Americans” meaning the imperial establishment straddling Washington and Wall Street, and contemptuous of idiots who put up with them.
There was never less reason to fear democracy: the masses of people have never been more in agreement and less enthralled by fanatics and obscurantists than they are now. The only vicious elements in society, as the recent riots showed, are at the top of it. Were any churches, mosques, temples or community centres targetted by the rioters? I suspect not. Were there any outbreaks of communal violence? Very few, is my guess. Were there any lynchings? A couple of muggings but nothing like the riots of days past.
Paris in 1792, London in 1780 were very different places. The only reigns of terror that we have seen for many years have been those waged by the 1% and their forces, including the reactionary bigots dredged up by oil royalty, against the people. Criminals enabled by imperialists, faux prophets auditioning for ideological/court jesting positions.
Fascism is not an alternative to capitalism but a form it takes at certain phases in its development. The current crisis is entirely different from that of the 1930s when much, even of the industrialised world, was beyond the peripheries of the imperial system. Today things are changed utterly: capitalism cannot even pretend that it has answers for any of the urgent questions facing humanity. It has run out of bullshit. And that is what the idiotic conferring in the Eurozone signifies. The game is over but the mess left to be cleaned up is atrocious. It will keep humanity busy for the foreseeable future. The trick is to make sure everyone shares in the work, the rewards are fair and nobody is left behind.
Marx was right over century and a half ago but few took any notice. They’re taking notice now. His insights are as relevant as ever. Capitaism creates its own gravediggers and those graves are almost dug.
@Suhayl
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‘Don’t worry, Craig. We won’t shoot you (!)’
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Ha ha! You speak for yourself.
cataclysm of humanity ( what does it mean?)
http://www.youtube.com/watch?v=J_x04Gn3-2g
And after watching this form of “diplomatic” response from one who is a ruler of the world – then one can better understand the phrase:-
“cataclysm of humanity”
Courtenay Barnett, When I wrote “cataclysm of humanity”, I was thinking more about what goes on inside the minds of evil. I have always thought that the greatest insight was given by something attributed to Benito Mussolini…”It is better to live one day as a lion than a lifetime as a sheep”…That I think tells us much as how they regard themselves and how little life/existence means to them. Something to do with a malformed Id.
http://wilderdom.com/personality/L8-4StructureMindIdEgoSuperego.html
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It is only my opinion.
Mr. Sunshine, I see. God, now I am really depressed.
I learned in history that revolutions only happen when there is a tiny bit of hope. Craig – I don’t think you are going to be shot by a revolution as it consumes itself. I suspect that you will die of some relatively treatable condition because proper medical care is no longer available. We (collectively) probably have a hundred years of serfdom before those with two pigs get shot by those with only one. Cheer up man.
Clintn reminds me of a fat, eighteen year old dietetics major (I know -I used to teach them basic english). Same undeveloped mentality and with little or no control over words or actions. The calibre of the woman is very disturbing. Some of Bill’s (ahem) actions now make more sense.
http://www.guardian.co.uk/commentisfree/cifamerica/2011/oct/23/cristina-kirchner-argentina