Free movement of capital effectively merges economies. If you think NAFTA is merging Mexico, the US and Canada, it is free movement of capital that is merging the US and China. When you have free movement of capital you effectively have a single economy, and when you have a single economy you need a redistributive economic policy encompassing the whole area where capital can move freely.
Actually what you have is an empire. And the problem we have now is that there are a limited number of empires - one big one, a few smaller ones - and a lot of nation states which still believe they matter, but whose internal politics and economics are defined by the needs of the nearest empire.
Redistribution is unlikely without civil push-back, because it's in the nature of empires that they're run for the benefit of their elites.
The elite is now international, while push-back can only happen nationally - at least so far.
The bottom line is that there's no chance at all of redistributive policies appearing by the usual democratic means without some event - like a depression or a war - which greatly weakens the empire first.
I loved this as well.
What's needed isn't scientific approval for economics, but a re-Enlightenment which exposes how ethically crippled and ridiculous it is and replaces it with something less cynical and more generous and thoughtful.
The Financial Capital sloshing about the globe isn't Value: it consists of two distinct and equally vampiric legal claims over Value - "Debt" and "Equity".
These combine to hoover up real Value ie "Money's worth" and thereby to impoverish the hapless victim countries by transferring Value overseas, either in terms of actual commodities or finished goods for consumption, or in entitlements to ownership of productive "privatised" assets.
An asset-based global financial system would necessarily be based upon forms of money's worth of which the most important - that of land rental units (eg square metre/ years) simply have no value in exchange outside the country where the land is.
ie exchange control is essentially "built in" to what would be nationally fungible land-based currencies.
The obvious candidate for a fungible global reserve currency is an energy unit eg the energy equivalent of a fixed number of Kilowatt/Hours.
Then all you need is an International Clearing Union (as proposed by Keynes, as Migeru reminds us) and some form of mutual guarantee mechanism backed by Pools of value aka default funds.
In fact, the only way out for the US system now is, IMHO, a "Debt/Equity" swap on a massive scale by creating pools of land rentals - through new forms of quasi-REIT's. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Is it just me or is the late 19th century looking familiar? Just that we appear to run through it in reverse or something. A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!
Gilded Age - Wikipedia, the free encyclopedia
In American history, the "Gilded Age" refers to unprecedented wealth polarization in the U.S. and wasteful displays of wealth and excessive opulence of America's upper-class during the post-Civil War and post-Reconstruction era, from the 1870s to the 1890s. The wealth polarization derived from industrial and population expansion. Industrialization during this era saw unusually rapid growth of railroads, small factories, banks, stores, mines and other enterprises and dramatic expansion into highly fertile western farmlands. Ethnic diversity increased through immigration. Steamship and railroad companies promoted immigration by emphasizing the availability of jobs and farmland. The era overlaps with Reconstruction (which ended in 1877) and includes the Panic of 1873.
And it ended with the second world war, when all the resources of the state had to be mobilized. As a matter of course, these resources were in the hands of a small elite, so the elite had to pay for it all, not because the government was for equality but because they took the resources from the people who had them.
Another parallell, with peak oil and the possibility of massive costly state programs on the horizon. The state will get the money from the people who have money, no matter who they are... Peak oil is not an energy crisis. It is a liquid fuel crisis.
The state will get the money from the people who have money, no matter who they are...
The State won't touch existing money - it will create new money, one way or another.
When has a war ever been prevented because it could not be "afforded" "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
