Sunday, August 14, 2011

What lies behind the debt ceiling 'crisis'?

Below I have posted some brief comments made recently by Diane Warth (our Econospeak administrator) on the recent US debt ceiling 'crisis'. "
I don’t believe the recent debt ceiling “crisis” was anything but a media circus designed to usher in the “necessary” dismantling of Social Security – Obama is a Wall St. puppet and the outcome was his intent. It’s a distraction.

The real story, in my opinion, is the bubble of arrogance the players insist on floating – encouraging the public to invest blindly in the virility of the US econ engine which prevents them seeing the fiat can they keep kicking down the road has hit a dead end. The financial elite do realise it and are hedging their bets on it. When the can hit the wall the elite created derivatives. Stiglitz challenged any economist to define derivatives. Not only did Wall St. create a catastrophically obscene amount of its own fake money, the Fed printed money to bail them out when the bubble burst. The scenario will repeat – what will stop it. The Indian economist Jayati Ghosh sees it happening in commodities.

The US is waging 7 wars and whilst its main exports are war-toys a manufacturer’s primary customer should not be itself, no? The “wars” are not going well. War is insanely expensive – robotics, PTSD, the medical costs alone would be injurious to the healthiest of economies let alone an unimaginably impaired one that has no real change in the works. The govt. can’t privatise the military quickly enough. Then there are the long-term health costs of new age weaponry, as well, not only does Japan have to deal with rebuilding infrastructure, but medical fallout for years to come – as would any country that experiences such a disaster, double the trouble here in the US where the nuclear industry is entirely subsidised by the public.

Trade policy remains moored in oppressive tactics – China now seems no more or less menacing a partner - the US emperor is naked but no one in Murdoch world notices. The kooky US left believes marching in DC will affect change? It’s pathetic. The crisis for capitalism will happen when China’s working class revolts. If that doesn’t happen, China will become what the US is today, as the US simultaneously bottoms out. I prefer the death blow to capitalism inflicted by a worker revolution but history is not a promising indicator.
" Hmmm...national 'trade policy'? Or is it the regulatory cartelisation of the global economy by state capitalist policies of the wealthy nations?

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