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One (or two) years on - they have learnt nothing

by Jerome a Paris Tue Oct 6th, 2009 at 06:29:46 AM EST

Just over one year after it became impossible to deny that the crisis that had started in 2006/2007 was a major, systemic event, it is rather depressing to see that nothing has really changed and, to the contrary, if anything has, it is for the worse.

The most striking item, of course, is the continued dominance of politicians by bankers. Banks are universally seen - including by bankers - as being at the heart of the problem, and having created the crisis through reckless behavior and worse. And yet, after having being bailed out at a staggering cost, in a highly asymmetrical way (the losses were socialised, but not the banks), not only have they managed to eliminate the likelihood of any real regulatory change, but more importantly they have managed to maintain the fiction that finance was the reason for earlier prosperity and should thus be protected as a source of future prosperity. The crash has not made anyone question the quality (or reality) of the previous boom, but rather made them wistful for these times. Thus, the dominance of the finance sector on the economy and the airwaves has not changed one bit: we still worry about the stock market, it's still financial analysts and economists that drive the public debate, we're still talking about "reforms" of entitlements or the labor market as if these were the main problem today, and public policy largely avoids the big looming issues of resource depletion and climate change.

Bumped by afew


To extend on this a bit, here are a few items worth noting:

  • there's very little discussion of the fact that this is an income crisis namely, stagnation/lack of income, which was dissimulated for a long time by increased access to debt. all the endless debating about replacing private debt by public debt and whether that's a good thing or a sustainable one ignore the underlying problem: middle and lower class wages & incomes have been squeezed and need to be supported. Instead, we get savage budget cuts in social spending, ie in the very programmes that supplement or complement most people's incomes, and yet more talk about making the labor market more "flexible" (which only ever means pushing wages down).
  • there's been very little talk of the profound underlying responsibility of the financial world in that drive to reduce the cost of labour. This is usually presented as an inevitable consequence of globalisation, when in fact it's been a clear policy choice to focus policy priorities on improving returns on capital (at the expense of everybody else), and to take decisions that justified these choices. For instance, the permanent push to make pensions market-based rather than government-run: this creates new markets for the finance industry and, at the same time, helps justify return on capital requirements as something good for everybody's pensions; stock market performance and short term returns of investment managers then become key numbers for everybody and further drive the focus on short term profitability;
  • the massive call upon public resources, and the apparent success of bailout plans (ie governments succeeded where the private market failed) has not lead to a real change of mood about government being a problem rather than a solution. Already the talk is about too-invasive regulation, and unhealthy public debt burdens, as if these had been caused by reckless civil servants. The most obvious point is that higher taxes to pay for government saving the day are still seen everywhere as inconceivable or inacceptable. Just like the War on Terror did not apparently require any financial effort, the Big Bank Bailout cannot be allowed to touch upon taxpayers - or banks, which are too-big-to-failer than before.
  • the oil price increases prior to the crash are now dismissed as aberrations caused by speculators and not a signal of anything deeper happening; similarly climate change worries are often dismissed by Serious People as a "luxury" in today's tough times. As a result, we're doing even less than we could on these problems - and so much less than we should. Oh sure, there's a nice bit of spending on green technologies in the various stimulus plans, but it's still dwarfed by help to traditional sectors of the economy (ie it's not really a game changer yet) and it's nothing compared to what we know can be done - more importantly, it's still seen as a sideshow, and more of a necessary PR exercise than actual policy; more generally, the focus on short term needs eclipses any long term thinking and planning; the discredit thrown upon government prevents it from fulfilling that natural role (and brings about a slow decay of infrastructure, generally);
  • throughout, progressive ideas and parties have been discredited - either by having Serious People call the bailout of the rich and other current regressive policies "socialism" and "leftwing," blaming the continuing crisis on Big Government while preventing actual public intervention where it would matter (public investment, increased transfers to the poor and unemployed, better and/or more universal public health care, etc) - followed by the knockout blow: claiming very loudly that the crisis somehow discredits the left;
  • behind all this, of course, is the agenda of large corporations - old industry incumbents, financial behemoths, not to mention the healthcare insurance juggernaut in the US - and their shareholders, and the twin overridding imperatives of return on equity and "competitive" management pay. They lobby, they run the debate and they outright buy off politicians. The grip of money over politics and policy has, if anything, tightened. But it's not seen as related to the crisis in any way - at least not by the Serious People (ie those that buy Serious People or are bought by them)
We need policies that actively promote (i) increasing incomes for the lower and middle classes, (ii) public investment (in particular on energy and healthcare) paid for by increased taxes, (iii) cutting down corporates (in particular, banks) to size. We obviously won't get any of these until the influence of money on politicians has been cut massively.

The past crisis was obviously not sufficient to shake the current system; if anything, the grip has been tightened. Pain for the masses does not matter if it has no impact on the political process; the past year suggests that the corporatists have been successful at defusing public anger and pointing it away from the real culprits; in many countries, the traditional left has been compromised too much within the system and cannot provide a credible alternative.

All this points, unfortunately, to a bigger crisis soon.

Display:
http://www.dailykos.com/storyonly/2009/10/5/789874/-One-(or-two)-years-onthey-have-learnt-nothing

As I noted over there, the mere fact taht Tony Blair could be considered for a high profil job shows that truly nothing has been learnt - other that they feel so entitled that they expect to get away with it.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Mon Oct 5th, 2009 at 12:06:17 PM EST
out in the actual population (U.S.), the majority know that the corporations are in control, that they are responsible for most of our problems, and that they own the federal government. The fact that only about 30% are self-consciously left or progressive precludes electoral control, but it is also a rather strong and rapid trend line. It was no more than 15 years ago, when the self-identification was more like 10%.

That, and the new political trend of youth here, bodes well for electoral politics - if we can wait that long. However, another factor is that another 30+% support particular policies/programs, such as 'public option' and 'single-payer' health insurance, plus 'get out of Iraq and Afghanistan'. Many of these folks are both truly independent and purposefully unideological.

The question then becomes, what happens within the 30+% when 'push comes to shove'. Can't answer that one - all that I can do is what I'm doing: proselytizing, working on accountability for elected officials in our state Democratic Party, trying to help to organize the progressives.

As to the "bigger crisis soon", I believe that explicitly. Won't be long before we find out how many of that 30+% are coming along with us.

paul spencer

by paul spencer (spencerinthegorge AT yahoo DOT com) on Mon Oct 5th, 2009 at 12:16:01 PM EST
You make it sound almost as if younger voters are embracing a new counter culture of alternative politics a la 1960's - when Vietnam and Civil Rights were the catalysts.  However looking at this from afar, I'm not sure there is that much coherence/chesion to the progressive left, and even the 1960's counter culture was bought off relatively easily.

Perhaps you would like to comment on the comparison...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Oct 5th, 2009 at 05:12:57 PM EST
[ Parent ]
it appears to have elements of counter-culture, except that it seems more substantive. I talk to a lot of people, older and younger, about forest issues, renewable energy systems - many different matters. Between those conversations - and they are conversations - and anecdotes from other 'involved' people, plus polling data, I say that there is a significant generation gap. One difference from the '60s is that the gap is actually 2 generations wide.

A large majority of the younger adults and near-adults do not share the prejudices of the folks a little older than myself - the prejudices that constituted conventional wisdom when I was young. It manifested itself in Obama's election demographics, for one instance.

And I repeat that it is unideological - unfortunately in my opinion. Part of the reason is that every political faction here is highly sectarian. Some folks talk about Christian fundamentalists as if they were monolithic - hardly the case. But it's the same with progressives here, as you note. All that I can say is that we're working on it.

I attended a conference in Portland this past weekend where there were around 8 break-out sessions every hour and a half. Rough guess, at least 500 people involved total. Better guess, a little more than half were younger than 30 years old.

On Saturday I had lunch with Laura Bonham of Progressive Democrats of America, a fellow Progressive Caucus member of the WA Democratic Party Central Committee, a local activist, and a local academic. Before lunch, we had been in a session concerned with coalition parameters, and the main discussion points at lunch were about accountability for Party-endorsed elected officials, growing the Progressive Caucus, and developing communication/cooperation among progressives. Will our conversation contribute to these goals? Actually, it might.

Weekend before, I attended our quarterly state meeting in Walla Walla. After a full Saturday of caucus meetings, committee meetings, and an afternoon plenary; 58 delegates (out of 160 registered for the Party events) stayed for an evening discussion/dinner at a local pub. (We were all amazed that such a large number stayed and participated.) It was a fully developed discussion, focused primarily on the accountability issue. One of the most encouraging aspects was the lack of disagreement - on the focus issue or the peripherals. In other words it seems that we're coalescing.

As to the '60s, I was counter-culture for about two years. I was only there due to profound anger and disgust with the prevailing culture's political manifestation. Other than that, it wasn't me, so to speak. That might sum up a fair amount of the decline of the counter-culture, alongside co-optation, as a social 'force'.

paul spencer

by paul spencer (spencerinthegorge AT yahoo DOT com) on Mon Oct 5th, 2009 at 06:47:21 PM EST
[ Parent ]
the Saturday evening get-together in Walla Walla was called by the Progressive Caucus.

If you have time, go to the WA Democratic Party web-site   www.wa-democrats.org   and skim our 2008 Platform. I think that you'll find it very - um - wholesome.

paul spencer

by paul spencer (spencerinthegorge AT yahoo DOT com) on Mon Oct 5th, 2009 at 06:52:52 PM EST
[ Parent ]
Well the counter culture seemed to live in denial of the dominant reality, and believed it could simply build a new reality alongside.  That didn't work out very well from almost every perspective, so the more engaged young you described seems a more hopeful sign - provided it isn't radicalised out of sight by some cataclysmic event.

It has always disappointed me that even progressives like Booman seem to accept that Democracy needs a two party system, and that the other party has to be the Republicans.  But it doesn't have to be that way.  They could be blown out of sight with the progressives becoming the opposition to centrist democrats.

It's partly a matter of education, money and organisation, but more crucially a mater of interests - a realisation that centrist democrats serve other interests and that politics is about organising to address your own.  The Republicans are so far up their own asses on this that they could just end up going down a plug hole of history - a vaguely irrelevant and angry inchoate mass which losses all traction in the real world.

Obama has set something going.  It will be interesting to see how far it runs...

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Mon Oct 5th, 2009 at 07:04:13 PM EST
[ Parent ]
paul spencer:
As to the '60s, I was counter-culture for about two years. I was only there due to profound anger and disgust with the prevailing culture's political manifestation. Other than that, it wasn't me, so to speak. That might sum up a fair amount of the decline of the counter-culture, alongside co-optation, as a social 'force'.

it wasn't a pretty sight watching the counterculture 'do' politics, flaming egomaniacs like rubin and abbie hoffman, cheap shallow stunts, extremely immature, doomed to irrelevance. this was the norm, unfortunately.

serious, 'straight' pols like tom hayden did more for progressive causes than any number of freaks flagging away.

i say this in sadness, as we had the numbers going for us like no generation before or since.

they've got much better networking tools than back then, but between the old wharfrats living longer, and less youth to become stirred to activism, i don't really see the sixties ethos having made much of a dent in realpolitik, other than the environmental movement, which is still getting its ass kicked by the same old PTB.

because you can't fight serious evil with flippant vacancy, like you can't pay the taxi driver with the pentacle of solomon.

perhaps the only lasting legacy of the 60's was a yearning for meaning through hedonism, not a bad thing per se, but hardly the breakfast of political champions.

after the beaver world of the 50's, mcarthy trials, and the misery of the great depression still within living memory, the upsurge of joy and relative freedom to experiment definitely had a culturally novel dimension, but soon enough whatever balance between sanity and adventure that briefly existed was battered to pulp, bought off, commodified and eventually used to sell cars, or took a dark left turn down manson alley.

the innocence was refreshing for a while, the waste and spaciness decidedly less so.

politics was seen as too dirty to mingle with mostly.

i'd just as soon kids learned about alternative energy than politics at the end of the day, too many start pure in politics and end up tie-chewers.

politics is really all about energy anyway, though the connections are still largely occluded.

not for long though, now ET is here to save the day!

"We can all be prosperous but we can't all be rich." Ian Welsh

by melo (melometa4(at)gmail.com) on Tue Oct 6th, 2009 at 09:26:48 AM EST
[ Parent ]


notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Tue Oct 6th, 2009 at 03:49:00 PM EST
[ Parent ]
Power's That Be.

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Oct 6th, 2009 at 04:04:11 PM EST
[ Parent ]
Sans the possessive apostrophe, of course.

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue Oct 6th, 2009 at 04:07:31 PM EST
[ Parent ]
You make it sound almost as if younger voters are embracing a new counter culture of alternative politics a la 1960's - when Vietnam and Civil Rights were the catalysts.

If they do, we can be sure another 30-40 years of hardcore republican class war will result. Wedge issues my friend...

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Tue Oct 6th, 2009 at 01:12:01 PM EST
[ Parent ]
Perhaps the GOP strategy is to try to split the Centrist/progressive democrats - and win by splitting their votes.  Obama is the bogey man because he has been very good at mobilising progressives whilst keeping the two reasonably united...

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Tue Oct 6th, 2009 at 03:45:18 PM EST
[ Parent ]
Yes to all points! The question is: "What will it take for any of this to change?" and "When will we begin the necessary work to provide a sustainable recovery and a sustainable world?"  I have posted some thoughts on the matter earlier.

As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Oct 5th, 2009 at 12:17:02 PM EST
European Tribune - One (or two) years on - they have learnt nothing
All this points, unfortunately, to a bigger crisis soon.
The problem this time around was that there was no coherent alternative paradigm to take over from what has been called the "intellectual collapse of neoclassical economics". This, together with the "there is no alternative" conventional wisdom, means that, for all its failings, neoclassical economics will not be abandoned and the mental capture of the policymakers by the financiers will continue.

An coherent alternative needs to be formulated and in place in people's minds (even if pushed to the back as unrealistic) in order to have a chance to take over from NCE at the next crisis. This needs to be an arguably untried alternative - paradigms are hard to rescue from the ashes of "intellectual collapse" - which disqualifies straight Marxism or Keynesianism which had their own "intellectual collapse" with the fall of the Soviet bloc and the stagflation of the 1970's, respectively.

En un viejo país ineficiente, algo así como España entre dos guerras civiles, poseer una casa y poca hacienda y memoria ninguna. -- Gil de Biedma

by Migeru (migeru at eurotrib dot com) on Mon Oct 5th, 2009 at 12:34:55 PM EST
Migeru:
This needs to be an arguably untried alternative -

Cue Chris Cook!

"We can all be prosperous but we can't all be rich." Ian Welsh

by melo (melometa4(at)gmail.com) on Mon Oct 5th, 2009 at 01:10:26 PM EST
[ Parent ]
Behave yourself, melo!

But it's not easy developing and proselytising a new paradigm if your livelihood depends on the old one. That is a risk and a sacrifice most cannot or will not make, usually because others depend on them.

I certainly didn't do what I did deliberately: I have never felt as though I have had a choice, really.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Mon Oct 5th, 2009 at 07:22:46 PM EST
[ Parent ]
maybe the reason no new approach to macro-economics is emerging is because there is no real need for one.

if laws are changed so to deny unaccountability and moral hazard to those who have proven to be irresponsible and greedy, then old models could continue to provide enough growth to preclude social chaos, provided the attitudes to distribution of wealth were profoundly re-schematised. it's the imbalance that makes it not fly right.

what has to stop is the macbethian trilogy of ambition, greed and disaster that characterises the present system.

the low info masses are a slumbering giant, and they don't even know how giant they are.

like gulliver tied down by thousands of threads!

one day, enough people will have enough information to shout down the wurlitzer, till then we watch the lies becoming ever more distorted, as the supercons effort to present a narrative that resembles anything plausible or even rational.

the whole game for them is how best to realise their fantasy of the good old days before people so easily shared information seen as seditious by People In Power. they try to squeeze today into yesterday's models, and it isn't working...

worst of all, it hurts so many so deeply as the PIP ply their no-trial-and-terror trial and error scams to remain in control.

you never know where the wave will break, right now it looks like the dairy farmers are getting pretty p'o'd.

there might just be a rerun of paris 68, but europe-wide, in a couple of years, at this rate of emplyment breakdown.

it just needs enough sparks, the tinder pile is sure dry enough.

personally i earnestly hope people find an unequivocally peaceful way to _protest, but the numbers have to be truly massive for that. my fear is that there'll be hotheads who precipitate things before there is enough groundswell to do it peacefully.

it reminds me of talking down a group of hostage takers to surrender, with the hostage in this case being the world economy. we've sent them in a tarp full of food, now we need some masterful psychology to make them see resistance is futile and only amplifies their demise.

microsoft's chief exec is on tv saying he doesn't expect recovery and we're going to be 'bumping along the bottom' for a 'significant amount of time, years...'

gee thanks!

"We can all be prosperous but we can't all be rich." Ian Welsh

by melo (melometa4(at)gmail.com) on Mon Oct 5th, 2009 at 01:48:49 PM EST
[ Parent ]
Today I asked my US history students (community college) if anyone had seen Michael Moore's new movie, and no one had.  I did my best to encourage them to see it.  We are studying the Gilded age and the populist movement of the 19th century, and I told them that Moore is making basically the same arguments these people were making more than 100 years ago.  I told them Moore is the same guy who made Bowling for Columbine and Sicko, which most of them had heard of or seen.  I hope a few of them will be motivated to scrape up the $10 to go see the movie soon.  Lumbering giant, for sure.  It seems to me that this mass of young twenty-somethings is not ready to challenge the status quo.  There is a lot of critical thinking and questioning just below the surface, most are working hard, and doing long hours at low pay for employers who just skirt the law, or don't, in their treatment of workers.  For them, it is just the way it is, and they all have bills to pay and classes to keep up with.  Questioning and challenging for them is just too much at this point.  The near economic meltdown of last fall is not something they are directly feeling; the unemployment just means it might be a little harder to find a minimum-wage job; and house prices and foreclosure, medical bills and bankruptcy are their parents problems.  My students are more worried about keeping their crappy cars running and maybe whether or not they or their friends will have to go back to Afghanistan soon.

That being said, I wonder if Michael Moore is Thomas Paine, and his movie the "Common Sense" of our day.  I wish he had gone into the history of unions more because I think that would be really inspirational.  Basically, the message of the movie is Corporations: who are these people and how did they manage to take over our government?

by jjellin on Mon Oct 5th, 2009 at 04:08:54 PM EST
[ Parent ]
jjellin:
I hope a few of them will be motivated to scrape up the $10 to go see the movie soon.

Or download it.

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!

by A swedish kind of death on Tue Oct 6th, 2009 at 05:58:39 AM EST
[ Parent ]
Two years on, we have learnt nothing too.

The political reality is that Washington and Westminster are the PR wing of Wall St and the City. The bailout was hardly an aberration - it was the inevitable next stage in a clear pattern of creeping corporate ownership of politics, legislation, and representation.

The problem won't be fixed by limiting bonuses or raising taxes. It won't even fixed by reinstating some new version of Glass-Steagall.

It can only be fixed by explicitly minimising and limiting the influence of Big Money on policy - the modern equivalent of separating church and state.

Currently there are no checks and balances on corporate influence, which makes further decline and disaster inevitable.

Apart from sites like dKos, with a useful but very limited ability to field and finance alternative candidates, and a few lingering political traditions, the only limit on the reach of the plutocracy is the brick wall of Earth's ecology.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Oct 5th, 2009 at 12:58:53 PM EST
the only limit on the reach of the plutocracy is the brick wall of Earth's ecology.

Which is fortunately and unfortunately more akin to a rubber band than a brick wall.

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Oct 5th, 2009 at 01:08:02 PM EST
[ Parent ]

the only limit on the reach of the plutocracy is the brick wall of Earth's ecology.

Fortunately and unfortunately, we're getting pretty close to that limit.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Mon Oct 5th, 2009 at 02:09:55 PM EST
[ Parent ]
ThatBritGuy:

It can only be fixed by explicitly minimising and limiting the influence of Big Money on policy - the modern equivalent of separating church and state.

Currently there are no checks and balances on corporate influence, which makes further decline and disaster inevitable.

I think it can only be fixed through a change in the very nature and basis of money, corporates and state, and I think that the enabling factor for this rapidly evolving transition is the direct instantaneous connection of the Internet.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Mon Oct 5th, 2009 at 07:28:15 PM EST
[ Parent ]
Thank you for summarizing the current fiasco. I posted the rhetorical question one year ago of , why hasnt there been any major indictments of any significant financial executives since many of them at all levels have committed fraud throughout the buildup of the crisis. The other question I posed was why hadnt the US,UK and French governments demanded quid pro quo for saving the financial institutions.

The answer to both is the same answer to 'why they have learnt nothing'- dont need to, they own the governments and their media mouthpieces. Nothing will happen significantly until there is civil unrest and the governments realize they have a greater responsibility to their citizens than their corporate masters.

It could happen in a very short term period or not for many years.

by An American in London on Mon Oct 5th, 2009 at 04:47:54 PM EST
A prime example of Jérôme's cogent and well-written analysis was in Fran's Salon last night.  In a long interview with Der Spiegel, Deutsche Bank CEO Ackermann shows exactly why we're still headed into a black hole.

 Print version here.

Some highlights:


Ackermann: If you are not omniscient and cannot precisely predict the future, you don't necessarily have to be plagued by self-doubt... I didn't think that individual banks had accumulated risks -- in some cases off the balance sheets -- of such a magnitude as has occurred. (Some?)
.....
Ackermann: It is very difficult to recognize bubbles in advance. At what point do rising prices constitute a bubble? If you sell off too quickly, you lose earnings and may soon no longer be in business. If you react too late, you suffer large losses. There would be no banking industry without risks, which is why it is so important, especially during boom periods, to maintain risk discipline -- or risk ethics. This is what we have done at Deutsche Bank. We, therefore, suffered no losses that threatened our capital basis, or even our existence.

SPIEGEL: Nevertheless, Deutsche Bank only survived because the entire system was stabilized with taxpayers' money.

Ackermann: We are grateful for the rapid and decisive intervention of the countries and central banks in the financial crisis. If it had come to a meltdown, for example, of Hypo Real Estate, this of course would have been devastating for us, too. But we also have to differentiate between those who have independently secured their existence, and those who could no longer do so. And I would like to point out that, in the final analysis, by issuing these bailouts the government acted in the interests of taxpayers and the entire economy.
....
SPIEGEL: Many companies complain that the banks are no longer lending them money. Is there a credit crunch?

Ackermann: I have not noticed a general credit crunch. There is no doubt that companies' loan costs and loan requirements have increased. But I can assure you that we, Deutsche Bank, remain available, as ever, with loans for our customers.

SPIEGEL: Nevertheless, the cheap money of the central banks is not reaching bank customers. Instead many banks have returned to the same old business deals, allowing them to make big profits again. Is the party simply continuing after the crisis?

Ackermann: The facts look different. First, interest rates have fallen, both for consumer loans and mortgages. The cheap money from the central banks cannot be passed on to customers as cheaply because it only makes a small contribution to the banks' refinancing volumes. The majority of our refinancing costs are significantly higher. Incidentally, the interest rate reflects not only the refinancing costs, but also the default risk. And this has increased due to the recession.
....

Much a what Ackermann says is seemingly harmless doublespeak, but at least from my perspective, reading between the lines (and there's so much more in the interview) illuminates Jérôme's points perfectly.

<blockquoe>
Ackermann: I expect changes in some areas of the tax system. I also hope that we can launch some new initiatives in our health and labor market policies.  (wonder what that means?)

I wish i wasn't thinking that this system has to devolve into chaos before it can begin the move to sustainability and right livelihood.  But then i read that BRIC and the Middle East are developing a plan to create a new currency basket in which to price oil.   Wheeeeeeee!

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin

by Crazy Horse on Tue Oct 6th, 2009 at 03:28:27 AM EST
Bah! Entschuldigung.


Ackermann: I expect changes in some areas of the tax system. I also hope that we can launch some new initiatives in our health and labor market policies.  (wonder what that means?)


"Life shrinks or expands in proportion to one's courage." - Anaïs Nin
by Crazy Horse on Tue Oct 6th, 2009 at 04:16:43 AM EST
[ Parent ]
(psssst.  should the front page title be spelled learned?)

"Life shrinks or expands in proportion to one's courage." - Anaïs Nin
by Crazy Horse on Tue Oct 6th, 2009 at 10:03:17 AM EST
[ Parent ]
Why?
Because the people we are talking about are not supposed to know the irregular form?

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi
by Cyrille (cyrillev domain yahoo.fr) on Tue Oct 6th, 2009 at 11:02:59 AM EST
[ Parent ]
First, we have the why. Why have sentiments not changed in spite of this massive crisis? My sentiments have certainly changed (helped by that graph showing long term median income development). It's not hard too see why that's the case in the US - where Obamas biggest sponsor was Goldman Sachs - but why no change here in Europe? I don't know, and if anyone has ideas on it, please enlighten me.

Second:

We need policies that actively promote (i) increasing incomes for the lower and middle classes, (ii) public investment (in particular on energy and healthcare) paid for by increased taxes, (iii) cutting down corporates (in particular, banks) to size.

It feels pretty good that my governemt actually kinda follows these guidelines. First, middle class disposable incomes have since 2006 risen by more than in any comparable period for several decades, due to big tax cuts and falling interest rates, and even stuff like cheaper power.

Second, public investment seems to be on the uptick, in that several large or very large public infrastructure projects have been decided, begun or will be, not financed by tax increases per se, but by growth giving the state more money without a need to raise taxes. Meanwhile public debt is shrinking as a percentage of GDP both due to a growing economy and amortisation of old loans, which opens a space for even more investment. Public debt now stands at 1/3 of GDP, and that could be as much as doubled without jeopoardizing the economy, given that the money goes to actual physical infratructure. That's about 100 billion euros that can be used, by the way.

There is no need to invest more in health care, as Sweden just won the award for highest quality healthcare in Europe for the fifth year in a row.

When it comes to cutting the banks down to size, the government has taken a hard line, vowing not to hand out a single krona without being issued shares in the banks, even if there has been no sign (or even public debate) about regulating the abusive and very profitable retail banking sector (bank accounts, mutual funds, "strucutured products", pension insurance and all the other BS fraud the banks are up to).

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Tue Oct 6th, 2009 at 01:09:47 PM EST


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