Thread: Economic impacts on politics.

http://www.globalresearch.ca/index.p...t=va&aid=12944
Article highlights some impacts of USA via international financial system on Russia, China and other countries around the world.

Quote from article:

"The U.S. media are silent about the most important topic policy makers are discussing here (and I suspect in Asia too): how to protect their countries from three inter-related dynamics: (1) the surplus dollars pouring into the rest of the world for yet further financial speculation and corporate takeovers; (2) the fact that central banks are obliged to recycle these dollar inflows to buy U.S. Treasury bonds to finance the federal U.S. budget deficit; and most important (but most suppressed in the U.S. media, (3) the military character of the U.S. payments deficit and the domestic federal budget deficit.

Strange as it may seem ­ and irrational as it would be in a more logical system of world diplomacy ­ the "dollar glut" is what finances America's global military build-up. It forces foreign central banks to bear the costs of America's expanding military empire ­ effective "taxation without representation." Keeping international reserves in "dollars" means recycling their dollar inflows to buy U.S. Treasury bills ­ U.S. government debt issued largely to finance the military."

See also http://en.wikipedia.org/wiki/Eurasia...omic_Community
and http://en.wikipedia.org/wiki/Shangha...n_Organisation

From article http://www.globalresearch.ca/index.p...t=va&aid=18636

"Latvia is being devastated by two global wars. On the geopolitical front is the Cold War’s coup de grâce. Neoliberals have managed to de-industrialize Russia and the rest of the former Soviet Union, persuading parliaments to dismantle government support for economic renewal. The “Washington Consensus” has backed a policy of giving away public enterprises and land to a newly minted oligarchy of insiders, and helped them sell shares to Western investors. The ensuing economic wreckage has helped avert future military rivalry to U.S. hegemony.

Western investors are waging their own social war of finance and property against labor. Initiated by the Chicago Boys in Chile in 1973, sponsored in Britain by Margaret Thatcher’s Conservatives after 1979 and by Ronald Reagan’s Republicans in the United States after 1980, this class war was capped by “Rubinomics” under Bill Clinton and the Democrats after 1992. Rejecting the classical distinction between earned income (wages and profits) and unearned income (economic rent, financial charges and land-price gains or other asset-price gains), this global war seeks to rationalize privatization of the land and key resources of the former Soviet Union and China as well as those in Third World debtor countries. Its aim is to roll back a century of Progressive Era regulatory reforms and taxation of rentier wealth. So over and above being on the losing side in this victory over Communism, Latvia has been swept up in this war of oligarchy against democracy. "

Article goes on to discuss western European predatory policies.

And another article http://www.globalresearch.ca/index.p...t=va&aid=13969

"... Mr. Medvedev called for China, Russia and India to “build an increasingly multipolar world order.” What this means in plain English is: We have reached our limit in subsidizing the United States’ military encirclement of Eurasia while also allowing the US to appropriate our exports, companies, stocks and real estate in exchange for paper money of questionable worth.. ...This means creating a new alternative. Rather than making merely “cosmetic changes as some countries and perhaps the international financial organisations themselves might want,” Mr. Medvedev ended his St. Petersburg speech, “what we need are financial institutions of a completely new type, where particular political issues and motives, and particular countries will not dominate.” "

Class warfare.

Economics is a political battle ground. Various factions strive to control political debates by using economics as though it is an established certainty about which there is no doubt. In reality economics theories and definitions are fought over by powerful factions, to control politics and the electorate. Mainstream economics have been largely captured by powerful property and financial interests to propel their agendas. This is readily seen by examining the history of economics.

In several videos, economist Fred Harrison shows some of the history of mainstream economics, and where economics have been purposely mystified. The resulting mystified economics are used within and between nations for class warfare, and to subjugate foreign nations by international institutions. Fred has several other videos worth viewing on his website.

http://renegadeeconomist.com/video/d...-2-coming.html
http://renegadeeconomist.com/video/d...apitalism.html
http://renegadeeconomist.com/video/d...yal-lords.html

Crucial to the on-going debate is the difference between earned and unearned income. Mainstream economists have worked hard to erase the distinction so that taxation increasingly penalizes earned income of working people. The opposite can be seen in the absence of tax on so-called qualified dividends in the USA. This favours financial and property interests. This is just one example among several, including depreciation schedules. Only financial and property interests can benefit from these.

I'll try to get to how these and other factors in mainstream economics have impacted Russia since the end of the USSR.

From article concerning economic policy implemented after break up of USSR.

'...a rent-tax as being essential for “purely” free enterprise to exist. In tsarist Russia a rent tax was endorsed most notably by Leo Tolstoy (who became a follower of the American land and tax reformer Henry George). This policy was about to be endorsed by the Duma under Alexander Kerensky in 1917 just before Lenin’s October Revolution.

The policy has been endorsed by a group of leading American economists who published an open letter to President Gorbachev on November 7, 1990. It was drafted not by socialists but by economics professors at the opposite side of the political spectrum, market economists and even libertarians who espoused the ideas of Henry George, headed by Nicolaus Tideman of Virginia Tech, future Nobel Economics Prize-winner William Vickrey, Mason Gaffney and Lowell Harriss. Other Nobel winners included James Tobin, Robert Solow and Franco Modigliani, as well as such prominent economists as William Baumol of Princeton, Richard Musgrave and Zvi Griliches at Harvard, and Alfred Kahn. “Dear Mr. Gorbachev,” they wrote,

"The movement of the Soviet Union to a market economy will greatly enhance the prosperity of your citizens. But there is a danger that you will adopt features of our economies that keep us from being as prosperous as we might be. In particular, there is a danger that you may follow us in allowing most of the rent of land to be collected privately.

It is important that the rent of land be retained as a source of government revenue. While the governments of developed nations with market economies collect some of the rent of land in taxes, they do not collect nearly as much as they could, and they therefore make unnecessarily great use of taxes that impede their economies–taxes on such things as incomes, sales and the value of capital. . . .

The rental value of land arises from three sources. The first is the inherent natural productivity of land, combined with the fact that land is limited. The second source of land value is the growth of communities; the third is the provision of public services. All citizens have equal claims on the component of land value that arises from nature. The component of land value that arises from community growth and provision of services is the most sensible source of revenue for financing public services that raise the rental value of surrounding land. These services include roads, urban transit networks, parks, and public utility networks for such services as electricity, telephones, water and sewers. A public revenue system should strive to collect as much of the rent of land as possible, allocating the part of rent derived from nature to all citizens equally, and the part derived from public services to the governmental units that provide those services. When governments collect the increase in land value that results from the provision of services, they are able to offer services at prices that represent the marginal social cost of these services, promoting efficient use of the services and enhancing the rental value of the land where the services are available. Government agencies that use land should be charged the same rentals as others for the land they use, or services will not be adequately financed and agencies will not have adequate incentive or guidance for economizing on their use of land.

Some economists might be tempted to suggest that the rent can be collected publicly simply by selling land outright at auction. There are a number of reasons why this is not a good idea. First, there is so much land to be turned over to private management that any effort to dispose of all of it in a short period would result in an extreme depression in prices offered. Second, some persons who could make excellent use of land would be unable to raise money for the purchase price. Collecting rent annually provides access to land for persons with limited access to credit. Third, subsequent resale of land would enable speculators to make large profits unrelated to any productive services they offer, resulting in needless inequity and dissatisfaction. Fourth, concern about future political conditions would tend to depress offers. Collecting rent annually permits the citizens of future years to capture the benefits of good future public policies. Fifth, because investors tend to be averse to risk, general uncertainty about the future will tend to depress offers. This risk aversion is sidestepped by allowing future rental payments to be determined by future conditions. Finally, the future rent of land can more justly be claimed by future generations than by today’s citizens. Requiring annual payments from the users of land allows each year’s population to claim that year’s rent. While the proceeds of sales could be invested for the benefit of future generations, not collecting the money in advance guarantees the heritage of the future against political excesses." (End of letter.)

This letter warned specifically against precisely the problems that would develop under Yeltsin’s “shock therapy” reformers and kleptocrats. But the U.S. Government, World Bank and IMF had other ideas, and blocked this basic approach, with well-known tragic results.'

And another article here, a little old, but with some very useful information.

Turkey and China to Shun the Dollar Wall Street Journal. Saturday, October 9, 2010

ISTANBUL—Turkey's Prime Minister Recep Tayyip Erdogan and China Premier Wen Jiabao said Friday their two countries would from now on trade using their own currencies, effectively excluding the U.S. dollar. The announcement, at a joint news conference in Ankara, came on the final stop of Mr. Wen's European tour. Mr. Erdogan announced eight trade agreements between the two countries, whose leaders also pledged to triple trade between China and Turkey to $50 billion within five years, and to $100 billion by 2020.
"We are forming an economic strategic partnership," Mr. Erdogan said. "In all of our relations, we have agreed to use the lira and yuan." Beijing has steadily been trying to raise the profile of the yuan, perhaps hoping it will someday play a bigger role in the world economy. In late September, China supported a Russian proposal to start direct trading between the yuan and the ruble. It has brokered a similar deal with Brazil.

More at Turkey, China Shun the Dollar in Conducting Trade - WSJ.com

Note that this is also excluding the euro.


These are the sorts of things that the world needs to see more of to build a more equitable future for all nations. The previous financial system based largely on the US t-bill standard has created a free ride for the USA, at the expense of other nations' economies. Recent activity to increase the currency raiding powers of US corporations has lead to virtual weaponization of the US dollar. More about this here Why the IMF Meetings Failed | Michael Hudson . Recent calls to revalue the yuan upward are simply attempts to carry out the currency raid of the century.

China's promoting yuan. Makes sense, I suppose.
But without the world's common reserve currency the global economy would disintegrate pretty quickly. It's obvious that dollar is not qualified for this role any more but I fail to see an alternative. Asia will stick to yen and yuan, Arabic states will use their own currency and South America as well. It appears that we'll have only about 3-4 world's currencies remaining.

[QUOTE=Ramil;208742] but I fail to see an alternative./QUOTE]

Золото и серебро

Yeah sperk is right, I think. At least with gold you know what you have...

The dollar and Bretton Woods setup is based on nothing. Possibly the biggest scam ever pulled and everyone is carrying on with the charade. The European currencies are not much better.

Maybe the the Yuan is the strongest currency but I really hope not!
As much as I don't like the current US dominance I'd really not want to live in a world run by China either.

Since the system is such a darn fake, do you think it's possible that the economic system / capitalism will collapse or implode like some ideologies predict? What would happen then...? Or is the current system of globalism and bank speculantism invinsible and bound to bounce back whatever happens?

Originally Posted by Hanna

Since the system is such a darn fake, do you think it's possible that the economic system / capitalism will collapse or implode like some ideologies predict? Or is the current system of globalism and bank speculantism invinsible and bound to bounce back whatever happens?

I think our thinking is next to useless as the thinkers you mentioned have already thought their thoughts through rather thoughtfully leaving us only to think what side to pick in this thinking game. However, I think we can't really think straight as the convincing thinking is just what it is - convincing and not necessarily true.

Originally Posted by Crocodile

I think our thinking is next to useless as the thinkers you mentioned have already thought their thoughts through rather thoughtfully...

At the national and international level, our thinking about what should be done, is just as you say. But what we should do at a personal level is quite another matter. People can do things to save themselves. I suppose the bankers would just as soon that we didn't do that either.

Originally Posted by Seraph

But what we should do at a personal level is quite another matter. People can do things to save themselves.

There are some things that could be done at a personal level under certain conditions. Should the conditions change, so the value would change. Money is just a means to transfer value under certain conditions. At a personal level, never trust any money in the long run. If you dislike USDs, exchange the current value of your USDs for the real estate or raw materials like gold. However, should the communists win the tomorrow elections, they would expropriate your real estate as much as your gold (to help those in need, of course, or whatever). Or, if tomorrow's government would decide to build a nice monument on your real estate and declare that place 'historic' or something like that, you would be obliged under law to hand your real estate over to the government for whatever price they see fit.

That is a way of thinking of a man whose views have been spoiled by capitalism and the world of consumption If the communists win (well, if this ideology dominates the majority of minds) people would not object to sharing the property. Communism is nicer than capitalism. It's the interim stage that's awful and involves breaking quite a few necks.

Originally Posted by Ramil

If the communists win (well, if this ideology dominates the majority of minds) people would not object to sharing the property.

And what would happen with the poor minority which would still object? That, of course, just can't happen, can it?

Originally Posted by Crocodile

And what would happen with the poor minority which would still object? That, of course, just can't happen, can it?

I doubt anyone would object after the interim stage. To everyone according to his needs, after all. )))

Originally Posted by Ramil

I doubt anyone would object after the interim stage. To everyone according to his needs, after all. )))

That is a famous populist slogan which cannot by definition have a decent implementation. So, I need my two islands and a Moon, can I have it? The only real implementation could be is to teach the people they do not need anything except for the bare minimum which would be established by the Communa (=by the present governors of the Communa that is). I don't really feel like loving that scenario very much. Do you?

The whole point that you wouldn't want islands and Moon.

Originally Posted by Ramil

The whole point that you wouldn't want islands and Moon.

Exactly. And you won't want car either. And an apartment too. And the two pairs of suits. Hell, you wouldn't even need one! Also, you wouldn't need to eat meat every day. (It's not that healthy.) Also, macaroni and cheese would make you fat, so it's another no-no. The present governors of the Communa will make those decisions for you. What you want and what you don't want. By the way, you haven't mentioned what should be done to those sick people who still want. I think they should be isolated from the society so as not to infect anyone else. Isn't that just great? Everyone is equal though. The social justice in its beauty.

so Ramil, are you a communist? Would you like Russia to return to a soviet lifestyle and economy?

Well I think everyone fundamentally agree that communism is hard to implement, due to shortcomings of the human nature.... But that's not what this discussion was about!

But in response to Crocodile's original comment, The one reason that makes it interesting to reconsider the future of capitalism / consumerism is that so much has changed since the major political philosophies were constructed, in the 19th century.

For example; Marx said that working class revolutions were inevitable, etc etc... Yet not that many have actually happened. Social democracy was supposed to lead to Communism; that hasn't happened anywhere.

Other political thinkers were writing that Capitalism is so clever and self-correcting and could literally never go very far wrong... ("the invisible hand" etc) Yet it's pretty much destroying the planet at a fast pace.. and the world is polarising between West and anti-west sympathies: something that none of the major political thinkers saw coming. So that line of thinking did not hold up very well either.

JS Mill, Marx, Hegel, Rawls etc, etc saw the world from the perspective of their own place in time and the state of the world back then.

Plus now everyone is affected by the endless media streams: Is media great or are we getting brainwashed at a level that a 19th century philosopher could never have envisaged. In the 19th century many could not read. Now everyone has a computer and internet. How does this change things.... etc!

sperk, there's a great difference between communism and socialism. Unfortunately, you can't have communism without first taking socialism and that's a big problem.

Crocodile, you're looking at everything in bad light. Moderate consumption can be easily satisfied without violence, etc.