Much of Sinn Fein's money, comes from foreign corporate donations. Such money to political parties, is outlawed, in other democratic countries, as it should always be outlawed in Ireland. The old Irish saying, "He who pays the piper calls the tune" has already been clearly demonstrated, in Blueshirt policies, in the south. Proper oversight or limits on these donations, does not exist in Ireland. These massive donations, will dictate Sinn Fein's neo-liberal policies, as a juniot partner with Fine Gael, after the nest election and will refect itself, in even further austerity for ordinary Irish people, to facilitate the corporations, with a cheap hungry workforce. British Sinn Fein have already signed, as junior partners in the Stormont Junta, to a Tory scorched earth policy, in the north, after the next British election. Today British Sinn fein delegates in Derry, voted not to join either a Fine Gael or Fianna Fail coalition, which has as much credibilty, as the neo-liberal deception, described in the article below.
The Neo-Liberal Deception and the New World Order
By Lionel Reynolds
Beginning in earnest in the late Seventies, a sustained and pervasive ideological attack was mounted against the role of the State in managing economic affairs. The terms of the attack ranged from ethical and philosophical arguments about individual liberty and property rights to more pragmatic arguments about the supposed economic advantages of private ownership, deregulation of capital and flattened fiscal regimes. Alternative visions of the role of the State were marginalised and discounted as either economically misguided or politically totalitarian.
The emerging consensus became known as Neo-Liberalism, or Economic Rationalism. It had its intellectual progenitors – Adam Smith, the Austrian and Chicago Schools, Ayn Rand; its political trail-blazers – Pinochet, Thatcher and Reagan, and its demons – Socialists, Marxists and Keynesians. When the Berlin Wall came down, and the ‘evil empire’ collapsed, it seemed that the ideological battle had been won – the deprived masses of the Socialist bloc had overthrown their Orwellian masters and would readily embrace the new credo. Ahead lay a brave, new, unipolar world in which largely unregulated markets would constitute the bedrock of a free, dynamic and innovative global economic order in which social wealth would be maximised.
In due course, after some initial resistance, the centre-left caved in to the Neo-Liberal gospel, especially in the Anglosphere, always the geopolitical fulcrum of the Neo-Liberal order. By the mid 90′s the centre-left in the UK, USA and Australia were committed to an economic program that was virtually indistinguishable from the Reagan/Thatcher platform of the previous decade, all be it dressed up in a more progressive social liberalism.
The reason that so many ‘social-democrats’ and ‘socialists’ embraced the Neo-Liberal revolution is that they came to accept its core claim that not only is capitalism the most effective way of generating wealth but that, contrary to now supposedly outmoded Keynesian and socialist views, it is also the best way of actually spreading the benefits of that wealth as widely as possible.
There are no losers – everyone’s a winner. The view is that governments don’t create wealth – they just spend it on coercing people and distorting market mechanisms that would otherwise produce greater social utility. By extracting the State from economic activity and allowing a more lightly regulated capitalism to structure production, distribution, exchange and finance, everyone is actually better off. The market mechanism can even play a positive role in improving social services like health and education, and providing essential infrastructure like transport, communications and energy – all with minimal regulatory regimes.
Under cover of this ideological offensive, the entire post-war Bretton-Woods economic order was dismantled. Capital controls were removed, public assets and infrastructure privatised and markets deregulated. Manufacturing and back-office functions were offshored. Organised labour was suppressed by legislation and by exporting traditional unionised industries to low-cost non-unionised labour markets. In addition to the huge profits to be made from deploying capital to low-wage economies, this also made it possible for capital to significantly increase the rate of surplus value extraction in the developed economies. The monetary value of what labour was making began to grow much more quickly than the monetary wage cost of the labour itself. Now that most consumer goods – for example clothing, electronic goods and household items – were produced cheaply in low-cost markets, the living costs of the developed economy worker were kept low, alleviating pressure on wages. It was a win/win for capital.
Consequently, for 40 years real wages in the developed world have been virtually stagnant – especially in the USA. In fact, income as a share of GDP has been in steady decline in many developed economies. Labour was producing more commodities than it had the monetary means to purchase, because an increasing share of the monetised value of commodities was being realised as capital, not wages. Inequality between capital and labour was further exacerbated by huge cuts in marginal tax rates and corporate taxes.
This is where the financial system stepped in to eliminate potential under-consumption. By leveraging capital sourced from expanding corporate profits and the personal wealth of the super-rich, the banks began to sell huge quantities of lucrative debt to the working class, enabling the latter to buy back the product of its own labour and keep capital accumulation ticking over.
Credit controls were relaxed leading to massive asset bubbles in property and consumer spending, which in turn spawned a parasitic, multi-trillion dollar shadow banking economy of ‘collateralised debt obligations’ (CDO’s) – tranched securities built from bundles of debt. These in turn spawned another equally large market in ‘credit default swaps’ (CDS’s) in which entities offered to ‘insure’ securities, even though the ‘insurance-buyer’ was often not even the owner of the reference assets, and the ‘insurance provider’ was not able to underwrite the debt ‘insured’. It wasn’t actually called ‘insurance’, so it didn’t fall under any insurance regulatory regime. In fact, most of the trade in CDO’s and CDS’s was wholly unregulated, taking place ‘over the counter’ rather than in organised exchanges.
As if the bankers were not getting rich enough from buying and selling consumer and property debt, they also branched out into buying and selling student debt – a new concept for most of Europe, which had previously operated under the assumption that tertiary education should be publically funded.
The property asset bubble, limitless personal credit lines, and the market in low cost consumer goods kept the developed world working class largely integated into the capitalist order. Real wages were stagnant and labour was being deprived of an increasing share of the value it created, but as long as property values were rising and credit card limits expanding there was always a source of liquidity to make up the difference. If you didn’t own a property, the answer was to work harder and longer and borrow the money to buy one – to ‘get on the property ladder’.
In 2007/8, the massive Ponzi scheme collapsed. Trillions of dollars were wiped off the market. The immediate cause of the collapse was over-leveraged household debt. Working class homebuyers in the USA began to foreclose. They had been sold mortgages on ‘teaser’ interest rates by brokers making a living flipping mortgages to CDO funds. The homeowners on teaser rates couldn’t actually afford the mortgage repayments at the market rate – they were relying on property values increasing so they could refinance once the teaser rate expired. As foreclosures spread, property values actually dropped, leading to more foreclosures, leading to further drops.
Suddenly, trillions of dollars of CDO’s began to lose value across the board as debts went toxic, debt repayment flows dried up and asset values collapsed. When large numbers of CDO holders tried to cash in their CDS’s the underwritten cash sums simply didn’t exist – the money wasn’t there. Exit AIG, the largest insurance company in the world. Banks stopped lending to each other because they all knew how heavily leveraged they were, and they all knew that the leveraged debt was going toxic. The financial system was deadlocked.
It then became clear that when the Neo-Liberals said that government interference in the economy is a bad thing, what they really meant to say is that it is a bad thing when it is for the benefit of labour. It turns out that it is in fact a very good thing when it is done in order to save the capitalist system from falling on its own sword. That would appear to be the only explanation for what followed – the biggest government bail out in modern economic history. All the money that hadn’t been available for manufacturing, for healthcare, for education, for infrastructure – suddenly became available to save the banking system.
The Federal Reserve, Bank of England and European Central Bank have, in the last 6 years, created trillions of dollars and handed them straight to the bankers. The process is called quantitative easing. The central banks create money via a digital book entry, and then use the money to purchase commercial paper from the banking sector – typically government and corporate bonds, but also CDO’s. This does two things. Firstly, it means that governments and corporations can raise credit cheaply, because the buyer of the debt knows they can flip it to the central bank and earn a return. This keeps interest rates low. Secondly, it injects liquidity into the banking system and keeps the business cycle going.
In the meantime, it’s austerity for the rest of us, as costs are driven down to encourage business investment and governments cut back on social programs in order to finance their ever growing debts.
It will be recalled that the ‘useful idiots’ of Neo-Liberalism – the centre-left that abandoned not just socialism but any semblance of Keynesianism – bought into the idea that privatisation, deregulation and flattened fiscal regimes were all consistent with traditional centre-left values of economic justice and equity. As it happens, there is overwhelming evidence that they were completely wrong.
In January of this year, Oxfam published a briefing paper called ‘Working for the Few’ (http://www.oxfam.org/sites/www.oxfam.org/files/bp-working-for-few-political-capture-economic-inequality-200114-en.pdf ). The paper was released to coincide with the 2014 World Economic Forum at Davos, the premier public social event for self-respecting members of the global elite. The paper is based on the tactical idea that the World Economic Forum is part of the solution, which rather flies in the face of the commonplace historical observation that, with some notable individual exceptions, the rich and powerful are not given to fundamentally questioning the structures that support their wealth and power.
Having said that, the report is a stunning indictment of the Neo-Liberal deception.
In the opening executive summary the reader is informed that:
Almost half of the world’s wealth is now owned by just one percent of the population.
The wealth of the one percent richest people in the world amounts to $110 trillion. That’s 65 times the total wealth of the bottom half of the world’s population.
The bottom half of the world’s population owns the same as the richest 85 people in the world.
Seven out of ten people live in countries where economic inequality has increased in the last 30 years.
The richest one percent increased their share of income in 24 out of 26 countries for which we have data between 1980 and 2012.
In the US, the wealthiest one percent captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer.
In the ‘People’s Republic’ of China, now firmly established as an integral component of the world capitalist order, supplying cheap consumer goods to the US/EU economies and using its massive US dollar foreign exchange reserves to help bankroll the US/NATO war machine, the report states that the richest 1% have more than doubled their share of national income since 1980.
The report reveals the stunning fact that 18.5 trillion dollars – a sum greater than total US GDP, is held unrecorded and offshore in tax havens – the lion’s share held in a network of current and former British possessions – Hong Kong, The Cayman Islands, Singapore, Jersey, Bermuda and Guernsey.
As for the distribution of wealth, 10% of the global population control 86% of total global assets, whilst the bottom 70% control just 3%.
Regarding the increased rate of surplus value extraction from developed economy labour, and its relationship to the offshoring of manufacturing and anti-union leglislation, the report explains that:
A report from the International Labour Organization (ILO) shows that between 1989 and 2005, union density (a measure of the membership of trade unions which represents union membership in relation to the total labor force) mostly declined in countries for which data are available, and that union density is negatively correlated with income inequality. Power relations between owners of capital and workers have changed dramatically in the past three decades in many countries, mostly as economies have moved from manufacturing to services, and as globalization has allowed for outsourcing of jobs. This is reflected in the decreasing share of income going to labor: over the past three decades, wages, salaries and benefits represent a smaller share of national income in nearly all ILO member countries.
There is, however, one region that is bucking the trend and that just happens to be the region of the world in which significant elements have bucked the trend to Neo-Liberalism and are turning to the Left – Latin America. The report explains that:
growth of tax revenues in Latin America has been the fastest in the world, and this growth has translated to higher spending to reduce inequality. For instance, between 2002 and 2011, income inequality dropped in 14 of the 17 countries where there is comparable data.During this period, approximately 50 million people moved into the middle class, meaning that for the first time ever, more people in the region belong to the middle class than are living in poverty.
The report continues:
By some estimates, social spending as a percentage of GDP across Latin American countries increased by 66 percent over the past twenty years. The impact is noticeable, given that not long ago the region had among the lowest public spending levels in the world. Increased spending on health and education has had the greatest impact on inequality reduction.
The report concludes with a set of recommendations, including:
• Stronger regulation of markets;
• Curbing the power of the rich to influence political processes and policies that best suit their interests.
• Cracking down on financial secrecy and tax dodging;
• Redistributive transfers; and strengthening of social protection schemes;
• Investment in universal access to free healthcare and education;
• Progressive taxation;
• Strengthening wage floors and worker rights;
This is, of course, the complete opposite of the Neo-Liberal prescriptions that have seduced significant elements of the so-called ‘left’ for the last 20 years.
The fact is that ‘we’ allowed the global super-rich to screw us, and then we bailed them out when the system that made them rich was in danger of collapsing. They got richer and richer, while we were bought off with the illusion of increasing wealth, when the reality is that we have been getting a declining share of the wealth we actually produce.
For years we have been told there was no money for social programs, and that our children had to pay to go to university, while trillions were spent on USA/NATO imperial wars and capitalist banker bailouts, and further trillions were hidden away in largely British-connected tax havens.
We should all be very angry with the Neo-Liberals
Tariq Ali: The Time Is Right for a Palace Revolution
By Chris Hedges
March 06, 2015 "ICH" - "Truthdig" - Tariq Ali is part of the royalty of the left. His more than 20 books on politics and history, his seven novels, his screenplays and plays and his journalism in the Black Dwarf newspaper, the New Left Review and other publications have made him one of the most trenchant critics of corporate capitalism. He hurls rhetorical thunderbolts and searing critiques at the oily speculators and corporate oligarchs who manipulate global finance and the useful idiots in the press, the political system and the academy who support them. The history of the late part of the 20th century and the early part of the 21st century has proved Ali, an Oxford-educated intellectual and longtime gadfly who once stood as a Trotskyist candidate for Parliament in Britain, to be stunningly prophetic.
The Pakistani-born Ali, who holds Pakistani and British citizenships, was already an icon of the left during the convulsions of the 1960s. Mick Jagger is said to have written “Street Fighting Man” after he attended an anti-war rally in Grosvenor Square on March 17, 1968, led by Ali, Vanessa Redgrave and others outside the U.S. Embassy in London. Some 8,000 protesters hurled mud, stones and smoke bombs at riot police. Mounted police charged the crowd. Over 200 people were arrested.
Ali, when we met last week shortly before he delivered the Edward W. Said Memorial Lecture at Princeton University, praised the street clashes and open, sustained protests against the state that erupted during the Vietnam War. He lamented the loss of the radicalism that was nurtured by the 1960s counterculture, saying it was “unprecedented in imperial history” and produced the “most hopeful period” in the United States, “intellectually, culturally and politically.”
“I cannot think of an example of any other imperial war in history, and not just in the history of the American empire but in the history of the British and French empires, where you had tens of thousands of former GIs and sometimes serving GIs marching outside the Pentagon and saying they wanted the Vietnamese to win,” he said. “That is a unique event in the annals of empire. That is what frightened and scared the living daylights out of them [those in power]. If the heart of our apparatus is becoming infected, [they asked] what the hell are we going to do?”
This defiance found expression even within the halls of the Establishment. Senate Foreign Relations Committee hearings about the Vietnam War openly challenged and defied those who were orchestrating the bloodshed. “The way that questioning was conducted educated a large segment of the population,” Ali said of the hearings, led by liberals such as J. William Fulbright. Ali then added sadly that “such hearings could never happen again.”
“That [spirit is what the ruling elite] had to roll back, and that they did quite successfully,” he said. “That rollback was completed by the implosion of the Soviet Union. They sat down and said, ‘Great, now we can do whatever we want. There is nothing abroad, and what we have at home—kids protesting about South America and Nicaragua and the contras—is peanuts. Gradually the dissent decreased.” By the start of the Iraq War, demonstrations, although large, were usually “one-day affairs.”
“It was an attempt to stop a war. Once they couldn’t stop it, that was the end,” he said about the marches opposing the Iraq War. “It was a spasm. They [authorities] made people feel there was nothing they could do; that whatever people did, those in power would do what they wanted. It was the first realization that democracy itself had been weakened and was under threat.”
The devolution of the political system through the infusion of corporate money, the rewriting of laws and regulations to remove checks on corporate power, the seizure of the press, especially the electronic press, by a handful of corporations to silence dissent, and the rise of the wholesale security and surveillance state have led to “the death of the party system” and the emergence of what Ali called “an extreme center.” Working people are being ruthlessly sacrificed on the altar of corporate profit—a scenario dramatically on display in Greece. And there is no mechanism or institution left within the structures of the capitalist system to halt or mitigate the reconfiguration of the global economy into merciless neofeudalism, a world of masters and serfs.
“This extreme center, it does not matter which party it is, effectively acts in collusion with the giant corporations, sorts out their interests and makes wars all over the world,” Ali said. “This extreme center extends throughout the Western world. This is why more and more young people are washing their hands of the democratic system as it exists. All this is a direct result of saying to people after the collapse of the Soviet Union, ‘There is no alternative.’ ”
The battle between popular will and the demands of corporate oligarchs, as they plunge greater and greater numbers of people around the globe into poverty and despair, is becoming increasingly volatile. Ali noted that even those leaders with an understanding of the destructive force of unfettered capitalism—such as the new, left-wing prime minister of Greece, Alexis Tsipras—remain intimidated by the economic and military power at the disposal of the corporate elites. This is largely why Tsipras and his finance minister, Yanis Varoufakis, bowed to the demands of European banks for a four-month extension of the current $272 billion bailout for Greece. The Greek leaders were forced to promise to commit to more punishing economic reforms and to walk back from the pre-election promise of Tsipras’ ruling Syriza party to write off a large part of Greece’s sovereign debt. Greece’s debt is 175 percent of its GDP. This four-month deal, as Ali pointed out, is a delaying tactic, one that threatens to weaken widespread Greek support for Syriza. Greece cannot sustain its debt obligations. Greece and European authorities will have to collide. And this collision could trigger a financial meltdown in Greece, see it break free from the eurozone, and spawn popular upheavals in Spain, Portugal and Italy.
The cost of open defiance, which, Ali pointed out, is our only escape route from corporate tyranny, will at least at first be painful. Our corporate masters do not intend to release their death grip without a brutal fight.
Ali recalled that even his late friend Hugo Chavez, the firebrand socialist president of Venezuela, was not untouched by intimidation from Establishment forces. “I remember talking to Chavez many times and saying, ‘Comandante, why do you stop there?’ ” Ali said. “He said it is not realistic to do it at the present time. We can regulate them, make life difficult for capitalism, use oil money for the poor, but we can’t topple the system.”
Ali added, “The Greeks and the Spanish are saying the same.”
“I don’t know what Syriza thought,” he said. “If it thought we can divide the European elite, we can make a big propaganda campaign in Europe and they will be forced to make concessions, that was foolish. This European elite, led by the Germans, doesn’t crack easily. They have walked all over the Greeks. The Greek leaders should have said to their own people, ‘We are going to try and get the best possible conditions—if not we will report to you what has happened and what we need to do.’ Instead, they fell into the European trap. The Europeans made virtually no concessions that mattered.”
The clash between the Greeks and the corporate elites that dominate Europe, Ali said, is “not economic.”
The European Union is “prepared to pour billions into fighting Russians in the Ukraine,” he said. “It’s not a question of the money. They can throw away the bloody money, as they are preparing to do and are doing in the Ukraine. With the Greeks they pretend it is economic, but it’s political. They are fearful that if the Greeks pull it off, the disease will spread. There are elections in December in Spain. If Podemos [Spain’s left-wing party] wins with Greece already having won and proceeding, however modestly, on a different path, the Spanish will say the Greeks have done it. And then there is the Irish waiting patiently with their progressive parties, saying, ‘Why can’t we do what Syriza has done? Why can’t we unite and take on our extreme center?’ ”
Ali said he was “shocked and angry about all the hopes that were invested in Obama by the left.” He lambasted what he called the American “obsession with identity.” Barack Obama, he said, “is an imperial president and behaves like one, regardless of the color of his skin.” Ali despaired of the gender politics that are fueling a possible run for the White House by Hillary Clinton, who would be the first woman president.
“My reply is, ‘So bloody what?’ ” he said. “If she is going to bomb countries and put drones over whole continents, what difference does her gender make if her politics are the same? That is the key. The political has been devalued and debased under neoliberalism. People retreat into religion or identity. It’s disastrous. I wonder if it is even possible to create something on a national scale in the United States. I wonder if it would be better to concentrate on big cities and states to develop some movements where they can have an influence in Los Angeles, New York or in states such as Vermont. It may be wiser to concentrate on three or four things to show that it can be done. I can’t see the old way of reproducing a political party of the left, modeled on the Republican and Democratic structures, as working. These people only work with money. They do not even speak with very many ordinary people. It is credit-card democracy. The left cannot and should not emulate this. America is the hardest nut to crack, but unless it is cracked we are doomed.”
Ali said he fears that should Americans become politically conscious and resist, the corporate state will impose naked forms of militarized repression. Government’s reaction to the 2013 bombings at the Boston Marathon stunned him. Authorities “closed down an entire city with the support of the population.” He said that the virtual declaration of martial law in Boston was “a dress rehearsal.”
“If they can do it in Boston they can do it in other cities,” he said. “They needed to try it on in Boston to see if it would work. That frightened me.”
“The manufacturing of threats manufactures fear,” he said. “It creates sleepwalking citizens. They [officials] never tried to do this on this scale when they were fighting the Soviet Union and the communist enemy, which was supposed to be the worst, most dangerous threat ever. Now they do it over a handful of bloody terrorists.”
Groups such as Black Lives Matter, he said, offer some hope.
“Just as the traditional left parties have been wiped out all over the world, so has the radical segment of the African-American population and their organizations,” he said. “They were physically wiped out. Martin Luther King and Malcolm X, some of the most gifted leaders, were assassinated. The Black Panthers were destroyed. Areas where blacks lived on the West Coast were flooded with drugs. It was a well-planned assault. But the young people who came out in Black Lives Matter have this older spirit. When Jesse Jackson went to Ferguson and engaged in demagogy he was heckled. They did the same on the East Coast with [Al] Sharpton. These black leaders, bought off, are being seen for what they are.”
Ali’s deep concern is that organizations such as Black Lives Matter too often react to events and “don’t totally grasp that dealing with this problem of continuous state violence against the citizenry requires political movements.” He worries that Americans lack an understanding of their own history and that very few are literate in basic revolutionary theory, from Karl Marx to Rosa Luxemburg. This illiteracy, he said, means that opposition movements are often unable to effectively analyze the structures and mechanisms of capitalist power and cannot formulate a sophisticated political response.
“Why didn’t the American working class produce a Labour Party or a proper Communist Party?” he asked. “Repression. If you look at … what happened in America in the early decades of the 20th century and the last decade of the 19th century you see that private mercenaries were hired to stop it [political organizing]. This is a history that is not emphasized. This wretched neoliberalism has downgraded the teaching of history. It is the one subject they really hate. Politics they can take up because they use anti-communism. But history is a huge problem. You can’t understand the emergence of Syriza without understanding the Second World War, the role of the partisans, the role of the Communist Party that organized the partisans and how at one point 75 percent of the country was controlled by these partisans. Then the West came and fought a new war, Churchill did it with Truman’s backing, to defeat these people.”
“I was sympathetic to the Occupy movement, but not to the business of not having any demands,” he said. “They should have had a charter demanding a free health service, an end to the pharmaceuticals and insurance companies’ control of the health service, a free education at every level for all Americans. The notion, promoted by anarchists such as John Holloway, that you can change the world without taking power is useless. I have a lot of respect for the anarchists that mobilize and fight for immigrant rights. But I am critical of those who theorize a politics that is not political. You have to have a political program. The anarchists of yore, in Spain, for example, had a real political program. This new type of anarchism achieves nothing. And probably half of these groups are infiltrated. We have the figures of how many FBI people were in the Communist Party and their Trotskyist offspring. There were huge numbers. FBI people were making key decisions.”
Ali said that the failure on the part of citizens to build mass movements to dismantle wholesale surveillance in the wake of the revelations by Edward Snowden was an example of our collective self-delusion and our complicity in our own oppression. The cult of the self, a product of neoliberal corporate propaganda, infects every aspect of society and culture and leads to paralysis.
“Hollywood gave an Oscar to “Citizenfour” and that is as far as it goes,” he said. “As if that matters. That is what is frightening. No civil rights movement has sprung up uniting the citizens against mass surveillance. Neoliberalism has effectively destroyed solidarity and empathy, helped by new technology. It is a culture of narcissism.”
Ali predicted that the current global speculation would result in another catastrophic financial crash. This new crash will give birth to “movements and people who will say, ‘Enough.’ ” If these movements build radical political programs with an alternative socialist vision for society, our “authoritarian capitalism” can be battled, but if this vision is absent, if revolt is simply reactive, things will get worse. The epicenter of this struggle, he said, will be in the United States.
“If nothing happens in the United States, if nothing new is created to challenge systemic excesses and empire, it will be a bad situation for all of us,” he said. “One is doomed if nothing happens in the U.S.”
For information about Tariq Ali’s new book, “The Extreme Centre: A Warning,” click here.
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