The Tea Party: In the shadow on the Confederacy.

October 10, 2013

The Signing of the Constitution. By Thomas Rossiter.

The Signing of the Constitution. By Thomas Rossiter.

As the days turn into weeks, the US shutdown edges no closer to being resolved. Polls consistently show that the public believe the Republican Party shoulders most of the blame for the chaos and the threat of default. Moderate Republicans join the growing chorus of disapproval of the shutdown and takeover by a small fringe group of well funded Tea Party Senators and House members. But it isn’t just the public, Democrats, the President, the courts, and moderate Republicans who blame the Tea Party faction for the shutdown, the Tea Party doesn’t seem to have the Constitution on its side either.

The Constitution of the United States is a work of genius. Largely influenced by James Madison’s brilliance for applying enlightenment philosophy to practical politics, and moderating the thoughts of Jefferson (who wished for the Constitution and all laws to be replaced every ‘generation’; 35 years) and the ideas of Hamilton (who pushed for a President elected for life); the Constitution ensures the minority cannot and should not be allowed to dictate policy on threat of economic or political catastrophe. The delegates to the Constitutional convention knew that the Constitution must be adaptable to the progress of US society beyond their own lifetime, and so amendments were the answer. The Founding generation – though they knew the threat loomed heavily – could not have accounted for the Constitutional issues that would arise when a Civil War eventually proved the biggest threat to the Union. One of which, was the debt.

The Fourteenth Amendment is one of those Constitutional Amendments that isn’t ambiguous. There isn’t much room for discussion or debate over its legitimate meaning. Section 4:

“The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”

– The validity of public debt shall not be questioned. The Amendment was passed in 1868, as a result of political wrangling in a Congress worried that the public debt would be used as a weapon by southern States for reconstruction concessions in social and economic spheres of influence. The 14th Amendment put a stop to that threat. The South reacted bitterly to all of the 14th’s provisions (including section 4), refusing to ratify it. They wished to use the threat of the debt, to force the US government to bend to their will, despite losing an election, and a war. The South was eventually forced to sign up, with threat of exclusion from representation in the United States Congress, if they refused. The 14th Amendment was an attempt to prevent the minority – and those who lose elections – from seeking to rule on their own terms. And it worked, until today.

It would appear with the threat of default looming on the horizon, the Republican Party has decided that the wording of the 14th is not clear enough, choosing instead to openly and proudly use the public debt as a weapon to extract concessions that they didn’t manage to win through the electoral process. It took over 140 years, but we cannot be under any illusion; as they move further to the right, the Republicans have spent the past few years channelling the spirit of the Confederacy when it comes to voter suppression, when it comes to subtle hints at secession upon the election of a candidate they didn’t like, and now in seeking to use the debt ceiling as a way to defund and delay an established, Constitutional law.

On the validity of the 14th Amendment, Chief Justice Charles Evans Hughes wrote in 1935:

“While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. Nor can we perceive any reason for not considering the expression ‘the validity of the public debt’ as embracing whatever concerns the integrity of the public obligations.”

– It is all embracing. It isn’t questionable. It should not be used as a tool for partisan point scoring.

Section 5 of the 14th Amendment tells us exactly which branch of government is in charge of ensuring the 14th Amendment is carried through:

“The Congress shall have power to enforce, by appropriate legislation, the provisions of this article.”

– It is Congress’s job to ensure that the validity of the public debt of the United States is not questioned. The historical context of the Amendment is such, that the Amendment was specifically designed to prevent the threat of default unless concessions are met. This isn’t new money the President is asking for, it is money already spent, debts already incurred. It is House Republicans refusing to pay the bills unless they get what they want. And whilst Speaker Boehner is right in that the debt ceiling has been used by both parties as a bargaining chip before, it has never been used to threaten closure of government and default on debts.

The President has no power to invoke the 14th Amendment to unilaterally incur and pay the US’s debts. The constitutional crisis caused by such a move by the President, may well prove to be more damaging than the threat of default itself. The President has been clear; the 14th Amendment does not allow him the power to raise the debt ceiling himself.

To this end, the Republicans know just how dangerous the course they have chosen is. This isn’t a negotiation. This is a threat of force. In 2011 Standard & Poor’s Credit Rating Agency issued the following statement:

“Since we revised the outlook on our ‘AAA’ long-term rating to negative from stable on April 18, 2011, the political debate about the U.S.’ fiscal stance and the related issue of the U.S. government debt ceiling has, in our view, only become more entangled. Despite months of negotiations, the two sides remain at odds on fundamental fiscal policy issues. Consequently, we believe there is an increasing risk of a substantial policy stalemate enduring beyond any near-term agreement to raise the debt ceiling. As a consequence, we now believe that we could lower our ratings on the U.S. within three months.”

– They are quite clear. The debt itself is not what will lead ratings agencies to lower the US’s Credit Rating. It is the politics of the debt ceiling and continued threat of political instability. This instability is driven by a small group of highly financed Republicans, distrusted and disliked not just by the American people and the Democrat Party, but also by their own colleagues. Whilst this is true, the instability is also the product of a lack of clarity on just which branch of government is responsible for ensuring payment of public debt, and if it is constitutional to use the payment of the public debt as political leverage. It is quite clear that the Republicans are using that lack of clarity for political posturing and to circumnavigate the democratic process that didn’t go the way they wanted. If this isn’t the use of force to extract concessions and hinder the stability of Constitutional, democratic government, the entire economy, and the will of the people in the United States, I don’t know what is. In theory, a law exists to deal with that threat:

18 USC Chapter 115 – TREASON, SEDITION, AND SUBVERSIVE ACTIVITIES:
“If two or more persons in any State or Territory, or in any place subject to the jurisdiction of the United States, conspire to overthrow, put down, or to destroy by force the Government of the United States, or to levy war against them, or to oppose by force the authority thereof, or by force to prevent, hinder, or delay the execution of any law of the United States, or by force to seize, take, take, or possess any property of the United States contrary to the authority thereof, they shall each be fined under this title or imprisoned not more than twenty years, or both.”

– There are several reasons here why I would argue that the Republicans in Congress have already openly played loose with this law. Firstly, the use of the tactic of closing down the government, by attempting to hinder, and delay the execution of the Affordable Care Act – a law passed by Congress, signed by the President, and upheld by the Supreme Court. Secondly, by attempting to prevent, hinder, or delay the payment of debts that the 14th Amendment insists shall not be questioned, and shall be enforced by Congress. And thirdly, the word “conspire” is key, especially given the months of planning that this shutdown has seemingly involved. The legal framework of the United States has been completely disregarded by a very small fringe right-winged movement that cannot abide elections that they did not win, and constitutional laws that they do not like.

Whether or not the Republican Party has broken, or cleverly maneuvered its way around Federal laws, is up for debate. The period of reconstruction attempted to set straight the Southern treat of using the debt as a bargaining chip, with the 14th Amendment. Today that democratic idea is being challenged by the children of the Confederacy. Reason dictates that if a small band of fringe Congressional representatives are able to close down the government, threaten economic disaster, unless a concession is made to defund or delay a law that the American people largely voted on in 2012, that was passed by Congress, signed by the President, and upheld by the Judiciary – all three branches of government – then something is seriously wrong with a democratic framework that allows for such a vicious tactic.


A place where the masses elevate fools into rich heroes

February 25, 2011

Born like this
Into this
Into these carefully mad wars
Into the sight of broken factory windows of emptiness
Into bars where people no longer speak to each other
Into fist fights that end as shootings and knifings
Born into this
Into hospitals which are so expensive that it’s cheaper to die
Into lawyers who charge so much it’s cheaper to plead guilty
Into a country where the jails are full and the madhouses closed
Into a place where the masses elevate fools into rich heroes

– Charles Bukowski

Whilst David Cameron continues to sell arms to violent nations, ignoring the fact that hundreds of fellow Brits are stranded in Tripoli, I thought I’d give you a bit of context on how Tories tend to view those who don’t own a great deal of wealth. Tory Peer Lord Lang, The Chairman of the Advisory Committee on Business appointments has announced that the committee that looks into business employing former ministers, said that he would only accept people to his panel:

“who had experience and proven success in a relatively important profession or trade – somebody who had achieved distinction – rather than a waitress or bus driver.”

– A beautifully elitist attitude if ever I saw one.

One should also bring into view, the alleged fraudulent behavior of Lord Lang in the past. He is a part-time director of Marsh & McLennan, a US company, and the World’s biggest insurance brokers. In 2004 they settled out of court, for massive fraud. They had moved clients toward insurers who Marsh and McLennan had payoff agreements with. They also solicited rigged bets for insurance contracts from those insurers. The CEO resigned and they settled out of court.

Another bad news week for the economic situation. Osborne must be wondering how long he can keep saying “obviously these figures are concerning” before he starts to realise he’s absolutely to blame.
Firstly, over here in the U.K, the government and it’s slightly more mental-than-usual support base spent Monday singing the praises of the horrifically dogmatic Libertarian George Osborne because public sector net borrowing showed a £3.7bn surplus. Rising VAT and raping public services of all funds brought in more money? Who’d have thought it!!! Of course there would be a surplus rise. I am not sure why that’s even news. I don’t think that most Tory supporters understood the point of public sector net borrowing and how it is funded.

This is evident with today’s announcement, that the UK economy shrunk worse than expected in the final sector of 2010. Initial reports said the economy shrunk by 0.5%. Comically, Osborne (remember, this man is our Chancellor) blamed the snow. Now it turns out the economy shrunk by 0.6%. If you look at the ONS figures from 2008 recession, to now, it tells quite an impressive story. Recession struck, and GDP fell massively. From 2009 to the end of 2010, the economy was growing and actually recovering substantially. And then Tory policies took hold, and the economy is shrinking again. The ONS figures show that if we don’t experience some sort of miracle bounce, we are about to hit a double dip recession very soon.

To give you a bit of context, since mid-2010, construction output has fell 2.5%, household expenditure fell 0.1%, utilities output fell by 4.6%, mining output fell by 4.5%. Here is the graph:

Anyone who looks at this graph and believes the Government know what they’re doing, is seriously deluded.
If you look at employment figures, they were recovering up until the last quarter of 2010. Now, they are worsening. It isn’t surprising given that the Government has decided to kick another 40,000 people out of work at the NHS. The cutting of simply back office staff (as if that’s a good thing anyway) is ridiculous, it will hit front line services.

Predictably Danny Alexander at the treasury couldn’t answer why the situation was worse than previously expected, without starting his sentence with “Well, we inherited…blah blah utter bollocks“.

This of course wont affect Gideon Osborne, who is a trust fund baby. He will never be insecure. He will never struggle. This is because Osborne is set to inherit a 15% stake in a wallpaper and fabrics company called Osborne & Little. He is worth £4,000,000. Despite this, he flipped his second home in order to pay less capital gains tax. The Lib Dems found that Osborne owed £55,000 in Parliamentary expenses abuses on his second home. Quite comically, he spent £47 of taxpayers money on a copy of a DVD of his own speech on “value for taxpayers money“.

As the misery is spreading, due to the less fortunate being expected to pick up the bill for the extravagances of the very fortunate, there is wonderful news for the banks. RBS, despite recording a loss of £1.1bn, gave out bonuses close to £1bn for 2010. Apparently nothing has changed since 2007. But then it isn’t surprising, we apparently as a nation collectively decided that to beat right winged economics and its massive failings, we need more right winged economics.

This is even more evident in the U.S. After the Republicans in Congress decided they will be forcing through some incredibly steep spending cuts, and a very weak Obama tacitly accepting, the Wisconsin assembly have voted to strip public workers of their collective bargaining rights.

What a horrible World we live in, when we decide it is more important for the owners of capital to treat humanity as a commodity, than it is for those people to live securely.

Essentially, what the Governments of the UK and US are telling us, is we do not understand what is best for us. What is best for us, apparently, is letting the private sector exploit as much as it wants, without us being able to stop it. They have cleverly managed to take a crises caused by Neoliberalism, and use it to push through some of the most Victorian style Neoliberal reforms we’ve ever had the misfortune to have forced upon us. The market doesn’t set wages. The base rate is set by very greedy employers. For this, unions are essential. I would urge all public sector workers in Wisconsin to collectively walk out. Let’s see just how unimportant Republicans think you are then.

Don’t let them tell you it is democratic. Being controlled by one CEO whom you cannot overthrow no matter how much you value your 2nd Amendment right to bare arms against tyrants, a CEO who is not accountable to you and whose main function is profit; being controlled by him, is not democracy and it is not freedom. It is Corporate tyranny.

Meanwhile David Cameron gave us his multiculturalism is dead speech, in which he mentioned the words “muslim” and “Islam” 36 times, in a 20 minute speech. Racism has always been a tool used by the fortunate to stifle collective action.

Thomas More once commented that

In fact, when I consider any social system that prevails in the World, I can’t, so help me God, see it as anything but a conspiracy of the rich to advance their own interests under the pretext of organising society. They think up all sorts of tricks and dodges, first for keeping safe their ill gotten gains, and then for exploiting the poor by buying their labour as cheaply as possible.”

When you analyse the rhetoric, it would appear that Thomas More was correct. The pretext of organising society after the financial crash has run thusly:

  • The Financial institutions should be bailed out.
  • The Public Sector should pay for the failings.
  • People will lose their jobs as a result of cuts.
  • Benefits for the unemployed must be cut, even as six people chase one job.
  • Help the one person who gets the job, fuck the other five.
  • Massive tax cuts for the wealthy.
  • Play on racial tensions.
    One wonders how it has managed to get to this point. But it isn’t new. Racism has always been played upon, during time of crises.
    During the American Civil War, very wealthy white Southerners managed to convinced poor white Southerners to go and fight for their right to keep black slaves. Why? How were they convinced that slavery would be beneficial to everyone? Well, they weren’t convinced. Racism was played up and the economic consequences were played down. If you convince a bunch of poor white people that those who are “racially inferior” want to be treated equally, and how they will infiltrate your kids school with their “barbaric culture”, you are very carefully constructing a social narrative that ignores the fact that the rich white folk, simply want slavery to save money on labour costs. If you can employ a black slave to do your work for free, you’re not going to employ the poor white person, regardless of how low you’re allowed to pay him. Slavery screwed over poor white people and poor black slaves. The only people who benefited, were the rich white people. And yet, poor white people were willing to die to perpetuate a system that held them back.

    This critique can be applied today. Somehow workers have been convinced, through constant negative media attention, that Unions are a great evil that need to be purged. It’s madness. During the British Airways strike, the media and so the mindless public at large took the line that the Union was to blame for the problems. The management who were screwing over both the workers and the customer were largely treated like the victims. The CEO of BA Willie Walsh had recently been forced to make BA pay the largest fine in Aviation history, after he was found guilty of price fixing. Somehow, the wealthy have managed to convince the workers that it is in their best interests, not to fight for better pay, and better conditions, and health benefits. We have been convinced, that exploitation and overbearing tyrannical management, is great for everyone. It is very U.S orientated approach to society. Which is kind of funny. America has weak unions, and strong anti-union laws. You’d think, under the rhetoric and the narrative that unions are a great evil, that America would be a pretty happy society…

    The Organization for Economic Co-Operation and Development conducted vast research into which countries people feel the happiest living in. It is all subjective, the people were asked if they thought their lives were predominantly affected by positive or negative experiences. Sample questions included:
    Did you enjoy something you did yesterday? Were you proud of something you did yesterday? Did you learn something yesterday? Were you treated with respect yesterday?
    They quizzed 1000 15-100 year olds, from 140 Countries.
    Surely, with all that Capitalism and so little union involvement, America should be steaming ahead? Far ahead of those EVIL SOCIALIST OPPRESSIVE EUROPEAN States weeping uncontrollably in their Government-run lives, right?

    As of 2009, here is the top ten happiest Countries out of the 140 polled:

    1. Denmark
    2. Finland
    3. Netherlands
    4. Sweden
    5. Ireland
    6. Canada
    7. Switzerland
    8. New Zealand
    9. Norway
    10. Belgium

    Their governments probably forced them to be happy, whilst talking through the Telescreen in the wall. Note that Canada is sixth.

    Perhaps it is all because whilst the happiest people in Denmark enjoy their EVIL SOCIALIST Government forced happiness, the US citizen, in his plethora of freedom, is working hard!!!
    Well, no.
    Firstly, Denmark’s unemployment rate is at 2%. Far far below the UK and US levels.
    Secondly, 9th place in the list, Norway has GDP per capita nominal of $84,543. Denmark has GDP per capital nominal of $55,113.The US has GDP per capita of $47,132. The US lags behind Sweden and Switzerland on this as well. The UK meanwhile lags behind Belguim, Singapore, Belguim, Japan. All figures from the IMF.

    As far as public debt goes (Osborne always mentions, as do most Tories, just how badly in debt we are, verging on Greece) as of 2009 figures, according to the CIA’s World Factbook, the UKs public debt as a percentage of GDP is 68.10%. Greece’s is 144.0%. Here is the list of Countries in between the UK and Greece, for public debt, along with their debt as a percentage of GDP:

    Iceland 123.80, Jamaica 123.20, Italy 118.10, Belgium 102.50, Singapore 102.40, Ireland 98.50, Sudan 94.20, Sri Lanka 86.70, France 83.50, Portugal 83.20, Egypt 80.50, Dominica 78.00, Nicaragua 78.00, Israel 77.30, Germany 74.80, Malta 72.60, Hungary 72.10, Austria 68.60, United Kingdom 68.10.

    Perhaps the UKs GDP itself is awful? What with Labour OVER SPENDING!!!!!!!!!!1111
    Oh wait, no, we have the sixth largest economy in the entire World. Our little island, is the sixth largest economy in the World. Greece, is 31st.

    Perhaps our debt is the worst we’ve EVER known? It must be pretty bad if we’re privatising absolutely everything and kicking thousands out of work?

    Okay that’s only 100 years.
    What about in the larger context?

    So it turns out the Nation’s debt, is still at one of it’s all time lows. Which begs the question, why do we believe the bullshit that has spread? The bullshit of a dire economic situation, is used purely to further the cause of an ideological attack, and nothing else.

    It is amazing. We are further empowering the financial institutions that are responsible for the problems. None of them have faced criminal charges. In the 1970s the power of the labour movements was clearly defined as the problem. Today, the problem is clearly the power of finance capital. And instead of putting a foot down and regulating the power of finance capital, we are loosening the chains even greater. Crises in this case, is inevitable. We will have another crash. But whilst we have a politics (not a democracy) funded and run by the very very wealthy, there can never be change.

    Private funding of political parties and inherited wealth from Stock Market speculation, are the great evils and the most anti-democratic and dangerous ideals of our generation.

    Politically, the left is week. They are in a daze because they have spent the past ten years being the Right. Ed Balls, Labour’s Shadow Chancellor cannot complain, he spent his years in office given up economic power to the financial sector. It is as if the political left (I make a distinction between the left, and the political left, because the political left is really the centre-right) doesn’t understand why its unwavering support for Thatcherite policies, has failed so miserably. It is odd, because our Political Left is still scared of certain lexis. Socialism is considered a dirty word and Capitalism is considered a golden word. Why? Capitalism failed everyone other than the very wealthy. Labour politicians do not like to be seen to align themselves with unions? Why Tories have no problem aligning themselves with greedy tax avoiding billionaires who endulge in questionable and often unethical business practices. Those businessmen represent a very narrow group of people. Unions represent thousands upon thousands of people who would be far worse off without the many industrial gains that have been made over the past century, thanks to collective bargaining.

    We need a strong united academically gifted Left for the theory, and a strong united working people’s party for practice. Note, this does not mean a local Socialist party….. they are all, as far as I can see, still living in 1917.

    So it turns out, all is not as dire as it seems. The multiculturalism card, I maintain, is being used to ensure a division between the lower classes who will be losing out whilst the rich class will benefit greatly. If we are inspired to concentrate on Nationality and Culture rather than the fact that the Polish worker, the Pakistani worker, and the British worker are all being massively screwed over, we wont rise up and fight back. Attacks by Unions as being attacks on the British public will be further propagated. As if it is their fault. It is a smoke screen designed to make us forget about the fact that the very people and the very economic ideology that got us into this mess, are going to be the ones who benefit the most.

    The Big Society will rescue us though, so it’s okay.
    (ignore the fact that according to Voluntary Sector Cuts, £53,000,000 has been cut from their budgets).

    Student strikes.
    General strike.
    Union united.
    Mass protests and rioting.

    Libertarianism must be fought against as if it is a foreign invader. Our children do not need to be born into “a place where the masses elevate fools into rich heroes“.


  • A Tory England

    October 21, 2010

    Quote of the cuts day has to go to Shadow Chancellor Alan Johnson, to Nick Clegg in the Commons directly after the Chancellor’s cuts package was announced:

    Somewhere between the ballot box and your ministerial car door opening, you changed your mind on everything.

    This particular brand of Conservatism is interesting. It is of course very Thatcherite. It is no different to what it was in the 1980s. Actually it is different because it is far more severe. It can easily be dressed up in lovely new inclusive phrases like ‘The Big Society’ and ‘Progressive Conservatism’ despite the fact that in less than ten seconds, the Chancellor can announce 490,000 expected job losses in the public sector, whilst his backbenches cheer gleefully. It’s easy to call it fair and necessary. But when, along with half a million job losses, we hear the Chancellor say:

    “The Employment and Support Allowance, given to people unable to work due to sickness or disability, will be restricted to one year”

    … it is virtually impossible for anyone who has even a fundamental understanding of the word ‘fair’ to be able to justify the madness.

    Yesterday’s spending review was ideological. It does not matter how many times Cameron says it isn’t, it is. It will devastate lives. £1bn is being saved by 2013 by cutting Child Benefit, yet £2bn is being given away to companies earning £350,000 a year, also by 2013. Most Conservatives are in politics for this very reason; to role back the Welfare State for the poorer and instead enlarge the Welfare State for their friends in business. When 490,000 people are instantly made unemployed, and the entire Conservative benches in Parliament stand up smiling and screaming, their faces beaming uncontrollably, waving their Parliamentary papers in the air with overwhelming joy; one finds it difficult to accept their rhetoric that this is ‘tough’ on them. It seems this is their moment in the spotlight. They were supremely happy yesterday. They have spent years hoping this moment would come.

    It has been a successful attack by the Tories and they have, I will admit, been amazing at getting their side of events across and gaining mass support for their plans. They have achieved this, as far as I can tell, in four ways:

    1) Absolutely 100% blame Labour for everything.
    It is clear that the Coalition has been told to mention the debt left by Labour as much as possible. It is perfect justification. Every Minister interviewed will refer to Labour’s legacy within about five seconds of being questioned. It is largely illogical because the debt left by Labour was firstly, very much needed, and secondly, is not actually dire.
    The problem with this view is that up until recession hit, the Tories pledged to back Labour’s spending pound for pound. So, by suggesting that Labour spent thirteen years on a spending spree, the Tories backed it fully. Then when the banks collapsed, and people’s homes and lives were put at risk, spending rose to keep people safe. This had to happen to offset the problems suddenly caused by huge unemployment. This isn’t the State’s fault. It isn’t the Government’s fault. Spending had to rise. What use is it cutting unemployment benefit during a time when unemployment is at an all time high? That is Tory logic. Allow the recession to run its course. Allow people to lose their homes and their jobs and to worry about how they are going to feed their kids. So next time when you complain about Labour’s debt, actually consider why we are in debt.

    2) Make sure the faults of the Private Sector are ignored.
    It was the financial sector that failed miserably. They risked everyone’s savings to enrich themselves further. But it isn’t just the banks that messed up. Since the early 1980s wages for workers have stagnated. They have hardly risen at all on average. Yet, the wages of the very wealthy; the owners, have increased ten fold. Take Sir Philip Green, the new Tory Party investigator of Civil Service pay; he owns a company called Taveta investments, which is registered in his wife’s name who happens to live in a tax haven. He has successfully avoided paying tax worth up to £285mn. At the same time, he awarded himself £1.2bn in a single year personally, whilst telling his work force (the people who actually make that money for him) that they must now increase contributions to their final pension scheme by half and work up to five years longer to receive it. He also uses sweatshops in India. BUT WE’RE ALL IN THIS TOGETHER. Now, you can only sustain unjustifiably large wages, like that of Mr Green if profit remains high. If your workers are being squeezed as much as possible, and have less disposable income to spend consuming and so enriching the very few, how do you do that? The solution was easy. You offer them easy credit, like a Topman Store Card. They then pay more than they usually would but over a longer period of time. Thus, the little man is squeezed further, but the guy at the top makes more. But apparently this is perfectly fine. The Public Sector, the sector that bailed out the Financial sector, is apparently entirely to blame.

    The problem as I see it, is that surplus profit was not being recapitalised in beneficial causes. Instead of expanding and looking into new forms of production, the owners of capital were buying up assets on the stock market. When this is amplified by million and millions of people, we suddenly have a problem. You buy assets on the stock market, hoping you will get a pretty handsome return in the future. But you understand that might not happen. You are gambling. The City of London and New York recklessly gambled our money away, they are entirely to blame.

    Whilst David Cameron likes to suggest that National debt is like household debt; he’s wrong. Not only is household debt nothing like National debt (I can’t suddenly raise taxes, if i go into the red, nor can I print my own money), but this neoliberal experiment, that the Tories kick started in the 1980s, actively encouraged us all to get into debt. This is why the banking sector collapsed. Because debt was encouraged. Secondly, personal debt is not always a bad thing if it helps improve the future. I am in debt, to pay for my education, which I hope will allow me to get a better job and be able to provide a better life for my future family, than I would had I gone straight into a job I did not want to do. This debt is an investment. Public debt is also an investment, especially if it keeps as many people in their homes and jobs as possible; which Labour understood (bare in mind, I am not a Labour voter), and which the Lib Dems understood before they were offered a bit of power. Public debt is not always a bad thing. It is often needed. It provides investment and a safety net.

    The Tories, with help from their friends in the Media (Conservative Director of Communications: Andy Coulson, used to be editor of News of the World) have shaped political discourse in this country to an apathetic and largely moronic population, beautifully. The Sun (owned by Murdoch, who also owns News of the World) ran a double page spread last Monday entitled “Britain’s benefit blackspots”. A guide to the worst areas of Britain for benefit fraud. Altogether, they noted that Benefit cheating costs the UK taxpayer £900mn. You may think that is a lot. But according to research by the TUC and Tax Research UK, Corporate Tax avoidance, and personal tax evasion (i.e – Lord Ashcroft and his non-dom status) costs the UK taxpayer close to £25bn. That’s about 30 times more in lost revenue. Enough to wipe out the deficit in about eight years, without the need for a mass of public service cuts.

    It is also suggested that public service workers are over paid. Now, given that wages have stagnated for most workers in the Private sector, i’d suggest that this is the fault of the Private sector. These bastards should pay more, not attack the public sector.

    The Tories ran the 2010 campaign on the idea that a rise in National Insurance was an evil ‘tax on jobs’. Today, they just killed off 50,000 jobs in 20 seconds. But, it’s the public sector, so apparently it’s okay. The massive consequences on communities and small private businesses, will become apparent very soon. The Tories will try to claim it is all Labour’s fault. It isn’t.

    The public sector, furthermore, is not inflated. Public spending during the 1960s was far higher than at any time during the 00s. Wages were rising beautifully during the 1960s too.

    3) Make sure the public believes, whether true or not, that this is the only way.
    The cuts that have been made, did not have to be so severe. They are overly harsh. We are a Triple A credit Country. 80% of our debt matures in 14 years, not a couple of years. We have the 5th largest economy in the World still. And we have the 3rd largest currency reserve in the World. And a very strong currency actually. So whilst you may believe everything the Tories tell you about how awful Labour were; it suggests to me that if the Tories were in power when recession struck, they’d have offered no help, spent absolutely no extra to keep people in homes and jobs, and then most probably blamed Unions.

    The current debt in the UK stands at 64% of GDP. After World War II, it was 180%. More than double now. Japan has a debt of 194%. The USA has a debt close to 73% of GDP. In fact, between 1920 and 1960, for that forty or so year period, UK government debt did not fall below 100%.

    4) Gain support from sources that apparently are credible.
    George Osbourne yesterday listed the people who agreed with him. We’ll take them one by one now. Firstly, he listed the IMF. The IMF is a neoliberal organisation that only ever proscribes harsh economic treatment to solve problems. They destroyed Ghana beyond recognition. Malaysia refused to accept anything the IMF demanded, and now Malaysia is doing just great. The IMF can also be blamed for half fucking up Ireland. Last week the IMF said that bank regulations were failing – We all fucking knew that two years ago. Nice of them to join us. Great source George. Secondly, he mentioned the CBI – the Confederation of British Industry. The business owners union. The same people who told us all that introducing minimum wage would destroy business in Britain. The same people who suggested that students are a drain on society, and yet they all went to university when it was free. They are businesses, looking to enrich themselves further, they have no sense of social responsibility, nor do they care if you cannot afford to eat. They would like to see no Welfare State and the NHS privatised. The CBI attempted to justify a huge amount of Corporate tax avoidance (discussed earlier) with….

    Legitimate tax planning – undertaken by companies that operate globally – should not be confused with so-called tax avoidance

    Thirdly, he mentioned the Bank of England. The institution responsible for the welfare of the economy. The institution that failed to see the biggest financial crises ever from taking place, even though that is its specific job. The same institution whose Deputy Governor Sir John Gieve admitted that they knew that the financial sector was out of control, and had no idea what to do about it. Another great choice for a source.
    And lastly, he mentioned the 35 businessmen who signed a letter and sent it to the press advocating everything they are doing. These businessmen are not economists. They do not know how to run an economy. They are under the impression that a business haven is ideal for all of us. Contrary to that opinion, i’d say otherwise. Nevertheless, they signed the letter. Who are these businesses? Well, one of them is Paul Walsh of Diageo, who I shall mention shortly. He has been given a role as an advisor to David Cameron. Vested interest number 1. Another is Nick Prest, Chairman of AVEVA. AVEVA has just been awarded a contract to supply Babcocks, who are to build the two new aircraft carriers unveiled by the Tories. Vested interest 2. Another, is John Nelson of Hammerson Investors. Massive tax avoiders, and are quite happy to even tell us that’s what they do, on their website. Perhaps I will refuse to pay any tax ever again and refer to it as ‘tax efficient’. Vested interest 3. Another is Moni Varma, Chairman of Veetee who admitted that Conservative HQ asked him to sign the letter. Not a vested interest, but an idiot nonetheless. Another is Philip Dilley, Chairman of Arup, who has just been given a place as an advisor to David Cameron. Vested interest 4
    The letter itself was drawn up by Next Chief Exec. Lord Wolfson. Wolfson has donated close to £300,000 to the Tory Party and is now a Tory Lord. Vested interest 5. Another is Sir Christopher Gent, non-executive chairman of GlaxoSmithKline. Gent has donated around £113,000 to the Tory Party. Vested interest 5. Isn’t it amazing? Why are we taking them seriously? Why aren’t their vested interests mentioned? I think I will email my logic Tory MP and let you know what his response is.
    Next, David Cameron has created a sort of business council. This includes Paul Walsh; the CEO of Diageo PLC, who has moved ownership of British alcohol brands offshore to avoid tax. Martin Sorrell, whose company WPP has moved entirely offshore to avoid tax. And CEO of Glaxosmithkline, Andrew Witty who avoids paying million in tax due to offshore accounting.
    None of these sources are credible. None have the Country’s best interest at heart. None care if a few hundred thousand lose their jobs, and their homes. This is Tory bullshit.

    It has been a very clever four pronged attack to win support for a program that would usually take months and years to thrash out the details of. The proposal yesterday was horrific. It is not Progressive or fair in any way. The Liberal Democrats should be utterly ashamed. They are finished. Out of protest, I will not vote in favour of AV, even though I once would.

    At the moment, the public is suffering from political apathy. They assume this is all necessary. It isn’t. It is dangerous and it is a complete attack on a decent, caring Nation in an attempt to turn us all into bitches of the business World. Labour are not all that much difference, hence the lack of credible opposition. They are not progressives. By moving to the centre, and even the centre-right, they have backed themselves into a corner. They no longer represent the Progressives. Their needs to be vast civil action. Unions need to step up, students need to step up, everyone needs to step up and let these people know that we should no longer be controlled or live in a society entirely shaped by a very select few old grey rich businessmen. I hold out hope and I have faith in this generation of anti-Tory opposition.


    Australian Debt

    July 26, 2010

    There is an election here in Australia, whilst I am still here. The choice is between the Aussie Labour Party, whom are currently in power with Julia Gillard as PM, and the Aussie Liberal Party, headed by a man whose head seems to be deflating whilst his ears remain untouched; Tony Abbott. The Liberal Party are the Australian Conservatives.

    What i’ve noticed from watching the PM and the opposition, is that the same empty rhetoric is used here, as it is in the UK. Gillard keeps using the phrase “hard working families“. Abbott keeps whinging on about “Labour’s debt“. It is the same bullshit. However, unlike the UK, the Australians don’t seem to be falling for the “WE MUST CUT THE DEBT NOW!!!!” nonsense put forward by Tony Abbott. In fact, Abbots’ own website points out that Labour are putting the debt up by $100,000,000 a day, every day.

    One of the issues that both the UK and Australians don’t seem to want to deal with, is the amount of easy credit available which has, over the past twenty five years in the UK caused much of the issues we’re now faced with. Essentially, what happened during the Thatcher years, was that her “trickle down theory” was an absolute failure. Whilst the wealth of the top 1% increased dramatically, the wealth did not trickle down. Wages stagnated, and have done ever since. The problem with that is, wages create the disposable income, and so if wages are not increasing, then eventually the wealth of the very few was going to hit a brick wall. The answer to that problem, was easy credit. Here have a piece of plastic with the River Island logo on it. You now have an easy £250 that you don’t have to pay back for two entire years! Have a credit card with a low interest rate. Have a house, and pay very little back. Until crises hit, because people couldn’t afford to pay it back. Suddenly, personal debt is at an all time high, no body has any money, the Government has to step in to stop the further abuses of banks and other places offering easy credit, and prop up a failing economy, and suddenly Conservatives are blaming the Government for the problems for not regulating private business affectively enough, whilst quite confusingly here in the UK electing a government dedicated to deregulation and further freeing up private business and banks to be as greedy as they so wish, which is exactly the reason we are in this mess. To cut a long story a little bit shorter……….. never ever elect Conservatives/Liberals/Republicans/Right wingers of any kind. Individual debt now accounts for a massive amount of the debt crises, across the World.

    Australia hasn’t been free either, from the adverse affects of banking deregulation. Deregulation in the 1980s in Australia, seemed to have allowed Banks the freedom to offer ridiculous loans, lower their rates, whilst at the same time reducing the security they needed to back the loans. So, when rates suddenly shot through the roof across the financial sector in 2007-8, the banks ran up losses into the billions. Deregulation failed the banking industry and so failed the consumer. It isn’t a surprise either, given that in 1991, an Aussie Parliamentary Inquiry into the Australian Banking Industry chaired by Stephen Martin found that freeing up the financial sector had not delivered the promised benefits to average Australians.

    Australia hasn’t escaped the easy credit problem. In 1980, the average Aussie Household had debts of around 40% of their income after tax. Today, it is 158% average debt. Which suggests that easy credit has become the norm in Australia too. Which means, lower interest rates don’t make much of a difference, and feel just as harsh as they would have felt when they were higher, in the 1980s.

    Back to National debt.

    The UK is not in a position to need to cut the deficit immediately, as suggested by the Tories, because we are the fifth largest economy in the World, we have a triple A credit rating, the third largest reserve currency in the World, and if we have enough money to spend £888m on subsidising the arms trade and a further £6bn a year on a 20 year old paranoia deal with Trident, we aren’t about to suddenly go horrendously bankrupt. The Tories are simply waging ideological warfare, there is no other reason.

    The Liberals in Australia are mounting the same attack on Australia, for ideological reasons. Australia is not in a debt crises by a long shot. National debt as a percentage of GDP for Australia, stood at 17.6% at the end of 2009. That puts Australia below every European Country with the exceptions of Estonia and Bulgaria, as well as below the USA, the UK, South America, Canada, and most of Africa. In fact, they stand at the 108th out of 129 in the ranks of worst Government debt as a percentage of GDP. That is pretty amazing. No Australian banks collapsed during the crises, and they came out of it pretty strongly, given that by May 2010, unemployment peaked in Australia, at 5.3%. In the UK, in May 2010, unemployment hit 7.8%. In the USA in May 2010, unemployment hit 9.3%.

    Australia, is not in a debt crises. It does not have to submit itself to deep cuts and years of misery. Its growth forcasts are excellent in comparison to the rest of the World. It didn’t have to bail out half its banking system, and it is well below the average debt to GDP ratio. Labour has not left Australia in a mass of unsustainable debt. The State of Victoria has a AAA credit rating. New South Wales has a AAA credit rating. In fact, Australia as a whole is 10th in the list of the least risky countries to invest in. It ranks above the UK, and the USA, as of March 2010. The Country Risk Survey studies the economic and political risks for investors wishing to invest abroad, out of 185 Countries. Australia, is the tenth best place in the World to invest in, according to the Survey.

    Australia can afford to spend money to secure a strong recovery, and to provide necessary funding to keep key infrastructure strong. When an economy is struggling a little, we cannot rely on the private sector to provide the education and the healthcare and the levels of policing required to deal with a down turn in economic fortunes, even though it is the private sector that will inevitably benefit from the protections and social infrastructure put into place. Australia can afford it. It can afford to do this, because when Australia is fully recovered from the financial crises, it will remain one of the best countries on the planet to invest in, which will inevitably increase revenue across the board, which can be used to bring down the deficit and then the debt steadily and responsibly rather than deep cuts to key services that are needed the most during difficult economic times.

    The Liberal Party Website describes how they are committed to a strong free market economy. Yet, at the same time, and rather contradictory, the website tells me they are committed to lowering the immigration rate to 1.4% annually. Surely a free market system, requires an outright destruction of all National boundaries; after all, National boundaries are simply left overs from the protectionist days of colonialism, and so it is hugely contradictory to be tightening immigration, yet pledging an era of an economy based on the principles of a free market system.

    The moral of the blog is; do not believe the nonsense right wingers throw at you. Watch their eyes sparkle with joy when they can unload their ideological crap and blame government and the Left for problems caused by the very same people they themselves set out to protect, every time they gain a little power. Australia doesn’t need a Thatcher.


    The USA & Greece

    May 13, 2010

    The above, shows (if you can make out the words, i know it looks ridiculously small) that the US is not going to be the next major economic casualty, after Greece. It just isn’t going to happen.

    My knowledge on economics is supremely limited. So please bare that in mind!

    Even the UK, which is in a far worse position than the US, is not even slightly as bad as Greece. We here in the UK have had two quarters of positive growth. I accept that given the bail out, and fiscal stimulus package, the growth figures are ridiculously low, but we are in a period of economic recovery. It is going to take a while to see the benefit.

    The Office of National Statistics report revised their original estimate for growth in the fourth quarter, to a much higher figure. We are actually in a much stronger economic position in the UK, than we first assumed. Government spending was needed to prop up the economy during recession. But, given that we are still only in recovery, I believe it’d be a massive mistake to withdraw that support as the new Conservative government plans to do shortly. In fact, i’m not entirely sure where the benefit of withdrawing support now, actually is? I accept in the future, we need to cut spending. I think though, forcing tax evading corporations to pay what they owe, should be the prime target. But cutting now, seems dangerous. Surely, when we are a growing economy, and the World itself is growing economically, that then would be a good time to cut. Not when people are struggling the most. I fear that it is just Tories being Tories. Cut spending, give people the option “Work where ever we say, or lose your home and starve to death…… and work twice as hard, for minimum wage…lower if we had our way!!! Whilst we give your boss a tax cut, so he can enjoy another game of golf a week“, and eventually the Nation’s money pot may improve, at the expense of social cohesion and morale.

    Fox News today asked if it were possible, that the U.S could become Greece economically. They all answered “yes“. Scare tactics.
    So I did some research, on the fundamental differences between the economy of Greece and the economy of the US.

    To fill the hole in the budget, both Greece and the US need to find around 6% of GDP, according to a report by economists Auerbach and Gale. My limited understanding of economics tells me that just because that number is true for both Nations, the measures needed to fill the gap, are nothing like one another.

    Greece’s budget deficit is 14% of it’s GDP. America’s is 9.3%. They are both pretty harsh figures, I accept.

    National debt in the US is apparently likely to hit 140% of GDP in the next twenty years. That doesn’t take into account policy changes, technology advancements, or any other sort of externality. It does not take into account growth as a result of investment in infrastructure etc. That figure simply goes by what it would be, if twenty years from now, were the same in every way, as today.

    Spending cuts, tax raises are obvious. But they do not need to be harsh as they do in Greece. Greece is in a far worse position. The US’s economy is growing, whilst Greece’s economy is shrinking. In order to protect itself from bankruptcy, by appealing to the IMF for a loan, Greece is being forced to reduce spending. Reducing spending during such a huge recession, is only likely to make that recession far worse. America is not in recession. It does not have to appeal to the IMF for a loan, it is not likely to fall back into recession any time soon. The growth will eventually provide the revenue to fill that 6% gap. When the US economy picks up, then spending cuts and higher taxation will further help the US bring down its cyclical deficit.

    The US dollar is still strong. Despite growing deficit and debt levels, the US is in a prime position to deal with its problems, because the dollar will be the leading currency for many many years. America is the largest economy in the World. Greece, is the 27the largest economy in the World. And whilst China is growing, it is not in a position to catch up to, or overtake America for quite some time. Investors simply do not trust the Chinese all that much, whilst at the same time, investors flee Greece. Whilst reserve currency status is not guaranteed to last, it certainly provides protection for the US, which provides 60% of the World’s reserve currency.

    Greece has to fill that gap within the next year. If they don’t, they risk pushing Greece into an even greater recession, which will inevitably lead to even greater structural deficits. Greece is in a mess. They ran up huge budget deficits during the good economic times. They inevitably ran up even larger budget deficits during the bad times. Greece’s structural deficit is horrendous. America’s, is not. The structural deficit in the USA is not perfect, true. And it is going to take some harsh measures over the next few years to help. But, the US can fill that 6% gap, over two entire decades. Greece has two years at the very most. It is also worth pointing out, that it was the Republican Party, the party of fiscal responsibility that spent away their budget surplus during the good times. And not in a positive way either. It was not Obama. America needs to simply slow down a little, not drastically cut.

    America obviously has to change over the long term, whereas Greece has to change immediately. The problem America has, is its particular brand of Capitalism; irresponsible consumerism. Growth for the benefit of growth. Wall Street offering no real social good. They simply exist to fatten their pockets. Your money, placed in banks, being used in dodgy dealings, rather than productive investments. Responsible Capitalism, in which the success of a Nation is in measuring how low the inequality gap and how low the poverty rate is, rather than the accumulated riches of the very wealthy. That is the only way the entire World will escape another preventable Global recession.


    The Reagan Legacy

    March 2, 2010

    Ronald Reagan, in my estimation, was a nightmare. He is adored as a grandfather like figure who transformed America, whilst his equally as evil minion, Thatcher “transformed” Britain. A Corporate bitch at best, a war criminal for what he did with Guatemala at worst. Reagan once commented on Guatemala:
    “President Ríos Montt is a man of great personal integrity and commitment. … I know he wants to improve the quality of life for all Guatemalans and to promote social justice.”
    President Rios Montt, staunch anticommunist, and funded almost entirely by the Reagan administration, was according to a Roman Catholic investigation, guilty of commanding widespread torture, rape, political murders and genocide against the indigenous population if they happened to show left wing sympathies.
    Greg Grandin, a reputable historian found that:
    “In Nicaragua, the U.S.-backed Contras decapitated, castrated, and otherwise mutilated civilians and foreign aid workers. Some earned a reputation for using spoons to gorge their victims eye’s out. In one raid, Contras cut the breasts of a civilian defender to pieces and ripped the flesh off the bones of another.”
    Quite ironically, one of America’s most wanted terrorists, Gulbuddin Hekmatyar, was funded almost exclusively by the Reagan administration, whilst also given full immunity for cocaine trafficking, people trafficking and other horrific offences, purely because he didn’t really like the Soviets either.

    Whilst Reagan was quite happily knowingly funding rape, death, and genocide over in Latin America; back in America he was launching an all out assault on organised labour. His Chief of Staff (ex-chairman of Merrill Lynch, and vice chairman of the New York Stock Exchange) Donald Regan helped build policy around this new Neoliberalist ideal. In 1981, air traffic controllers went on strike to demand better working conditions. 12,000 in all. When 12,000 people go on strike, ones instant reaction is that perhaps management isn’t all that great. 12,000 people are not holding the industry to ransom; the management is holding the people to ransom. Reagan didn’t see it that way. He had them all fired. As a result, management could now just replace striking workers, meaning workers didn’t dare speak out against poor working conditions. Which meant that management could do whatever the fuck they wanted. The median real wage did not grow, during the entire 1980s. But, the gap between rich and poor more than doubled, and the homeless rate was at the highest in decades. As a result of his tax cuts for the rich, the deficit reached record highs. After forcing a recession on the American public, he then managed to cut Federal low income household funds, by 84%.

    What about the middle class? According to research undertaken by Wallace Peterson, author of “The Macroeconomic legacy of Reaganomics“, The middle class share of the economy in 1980 was 61.7%. In 1985, that had shrunk to 58.2%. Similarly, the poverty rate under President Carter reached a peak of 12.1% before falling to 11.9% by the end of his term in Office. Under Reagan, between 1981-1986, the poverty rate shot up to 14.7%. Unemployment under Carter started falling and finished at 7.5% by the end of his term. Between 1981-1986, under Reagan, unemployment shot up to 8.1%.
    Under Obama, the unemployment rate has dropped from 10% to 9.7%, whilst U.S. Department of Commerce states that 4th quarter GDP growth went from 5.7% to 5.9%, the best rate of growth in seven years. Obama doesn’t have Fox News on his side, Reagan still does. That’s the difference.

    What Reagan essentially did, with his ideal of cutting the size of government and slashing aid to those who needed it most, was to bankroll the rich, spit on the poor, create a new class of homeless people, and use this new smaller government (which in fact, had more federal employees than any government before it) to undertake the task of destroying any left wing opposition in Latin America. That was the American Government’s new mission. Constitutional? Apparently so, if you ask Republican America.

    Economist Mark Weisbrot is quoted as stating that Reagan’s economic policies were “mostly a failure”. Free-market-failure-denial-sufferers, will never accept that Reagan was an utter failure. Weisbrot goes on to point out that: “The median wage was flat, and there was a massive redistribution of income, with wealth going to the top one or two percent of the population

    Was he the most popular President of the past century as some conservatives would have us believe? No. He never reached the 90% approval rating that even George W Bush and his father achieved, and Bill Clinton managed roughly the same rating during his two terms, surpassing Reagan in the second half of each of their terms.

    The hysteria about the debt and stimulus across the U.S, is crippling the recovery. America needs more stimulus. As does Britain. It didn’t go far enough. What the World doesn’t need, is another Reagan or Thatcher propagating the rumour that neoliberalism is the only way out of recession, because for millions upon millions of people, it certainly isn’t. During a recession of such huge proportions, a lack of easily affordable healthcare (a universal system), lack of a safety net, and lack of foreclosure federal help, means the majority is far more at risk from financial ruin and psychological depression. One of the many reasons i’ll never vote Conservative.

    Reagan’s legacy was one of homelessness, selfishness, arrogance, lack of compassion or empathy, hate, Corporate greed, death, and misery. All in the name of an economic policy disastrously known as “trickle down”. History will remember both him and Thatcher as little beacons of horror and misery. That’s all.

    Obama now needs to man up, recognise that he’s President, recognise that the Democrats control Congress, and make sure the Republicans – as well as being a laughing stock for the entire World – know that they are largely irrelevant now.