Best of the Week
Most Popular
1.UK General Election BBC Exit Polls Forecast Accuracy - Nadeem_Walayat
2.UK General Election 2017 Seats Final Forecast, Labour, Conservative Lib-Dem, SNP - Nadeem_Walayat
3.UK General Election 2017 Forecast: Conservative 358, Labour 212 Seats - Nadeem_Walayat
4.Theresa May to Resign, Fatal Error Was to Believe Worthless Opinion Polls! - Nadeem_Walayat
5.UK House Prices Forecast General Election 2017 Conservative Seats Result - Nadeem_Walayat
6.The Stock Market Crash of 2017 That Never Was But Could it Still Come to Pass? - Sol_Palha
7.[TRADE ALERT] Write This Gold Stock Ticker Down Now - WallStreetNation
8.UK General Election Results Map 2017 vs 2015 vs Opinion Polls - Nadeem_Walayat
9.Orphaned Poisoned Waters,Severe Chronic Water Shortage Imminent - Richard_Mills
10.How The Smart Money Is Playing The Lithium Boom - OilPrice_Com
Last 7 days
Nether Edge By Election Result: Labour Win Sheffield City Council Seat by 132 Votes - 23rd Jun 17
Grenfell Fire: 600 of 4000 Tower Blocks Ticking Time Bomb Death Traps! - 22nd Jun 17
Car Sales About To Go Over The Cliff - 22nd Jun 17
LOG 0.786 support in CRUDE OIL and COCOA - 22nd Jun 17
More Stock Market Fluctuations Along New Record Highs - 22nd Jun 17
Understanding true money, Pound Sterling must make another historic low, Euro and Gold outlook! - 22nd Jun 17
Green Party Could Control Sheffield City Council Balance of Power Local Election 2018 - 22nd Jun 17
Ratio Combo Charts : Hidden Clues to the Gold Market Puzzle - 22nd Jun 17
Steem Hard Forks & Now People Are Making Even More Money On Blockchain Steemit - 22nd Jun 17
4 Steps for Comparing Binary Options Providers - 22nd Jun 17
Nether Edge & Sharrow By-Election, Will Labour Lose Safe Council Seat, Sheffield? - 21st Jun 17
Stock Market SPX Making New Lows - 21st Jun 17
Your Future Wealth Depends on what You Decide to Keep and Invest in Now - 21st Jun 17
Either Bitcoin Will Fail OR Bitcoin Is A Government Invention Meant To Enslave... - 21st Jun 17
Strength in Gold and Silver Mining Stocks and Its Implications - 21st Jun 17
Inflation is No Longer in Stealth Mode - 21st Jun 17
CRUDE OIL UPDATE- “0.30 risk is cheap for changing implication!” - 20th Jun 17
Crude Oil Verifies Price Breakdown – Or Is It Something More? - 20th Jun 17
Trump Backs ISIS As He Pushes US Onto Brink of World War III With Russia - 20th Jun 17
Most Popular Auto Trading Tools for trading with Stock Markets - 20th Jun 17
GDXJ Gold Stocks Massacre: The Aftermath - 20th Jun 17
Why Walkers Crisps Pay Packet Promotion is RUBBISH! - 20th Jun 17
7 Signs You Should Add Gold To Your Portfolio Now - 19th Jun 17
US Bonds and Related Market Indicators - 19th Jun 17
Wireless Wars: The Billion Dollar Tech Boom No One Is Talking About - 19th Jun 17
Amey Playing Cat and Mouse Game with Sheffield Residents and Tree Campaigners - 19th Jun 17
Positive Stock Market Expectations, But Will Uptrend Continue? - 19th Jun 17
Gold Proprietary Cycle Indicator Remains Down - 19th Jun 17
Stock Market Higher Highs Still Likely - 18th Jun 17
The US Government Clamps Down on Ability of Americans To Purchase Bitcoin - 18th Jun 17
NDX/NAZ Continue downward pressure on the US Stock Market - 18th Jun 17
Return of the Gold Bear? - 18th Jun 17
Are Sheffield's High Rise Tower Blocks Safe? Grenfell Cladding Fire Disaster! - 18th Jun 17
Globalist Takeover Of The Internet Moves Into Overdrive - 17th Jun 17
Crazy Charging Stocks Bull Market Random Thoughts - 17th Jun 17
Reflation, Deflation and Gold - 17th Jun 17
Here’s The Case For An Upside Risk In The Global Economy - 17th Jun 17
Gold Bullish on Fed Interest Rate Hike - 16th Jun 17
Drones Upending Business Models and Reshaping Industry Landscapes - 16th Jun 17
Grenfell Tower Cladding Fire Disaster, 4,000 Ticking Time Bombs, Sheffield Council Flats Panic! - 16th Jun 17
Heating Oil Bottom Is In.(probably) - 16th Jun 17
Here’s the Investing Reason Active Funds Can’t Beat Passive Funds—and It Worries Me a Lot - 16th Jun 17
Is There Gold “Hype” and is Gold an Emotional Trade? - 16th Jun 17
The War On Cash Is Now Becoming The War On Cryptocurrency - 15th Jun 17
The US Dollar Bull Case - 15th Jun 17
The Pros and Cons of Bitcoin and Blockchain - 15th Jun 17
The Retail Sector Downfall We Saw Coming - 15th Jun 17
Charts That Explain Why The US Rule Oil Prices Not OPEC - 15th Jun 17
How to Find the Best Auto Loan - 15th Jun 17
Ultra-low Stock Market Volatility #ThisTimeIsDifferent - 14th Jun 17
DOLLAR has recently damaged GOLD and SILVER- viewed in MRI 3D charts - 14th Jun 17
US Dollar Acceleration Phase is Dead Ahead! - 14th Jun 17
Hit or Pass? An Overview of 2017’s Best Ranked Stocks - 14th Jun 17
Rise Gold to Recommence Work at Idaho Maryland Mine After 60 Years - 14th Jun 17
Stock Market Tech Shakeout! - 14th Jun 17
The #1 Gold Stock of 2017 - 14th Jun 17

Market Oracle FREE Newsletter

The MRI 3D Report

Europe’s Dirty Secret, Financial Elite Looting Public Treasuries

Politics / Credit Crisis 2010 Nov 19, 2010 - 12:40 PM GMT

By: Barry_Grey

Politics

Best Financial Markets Analysis ArticleIn a revealing admission concerning the relationship between capitalist governments and international financial interests, the Financial Times on Tuesday wrote of “Europe’s dirty secret.”

The newspaper editorialized against the plan of the European Union, the European Central Bank (ECB) and the International Monetary Fund to loan Ireland tens of billions of euros in order to guarantee in full the investments of international bankers and bondholders in the country’s failing banking system.


Under the plan, Ireland will effectively surrender sovereignty over its economic policy to the EU and the IMF and agree to claw back the latest bailout of the global financial elite by imposing a new and even more savage round of attacks on the wages and living standards of the working class.

The Financial Times argued that using the €440 billion European Financial Stability Facility (EFSF) to cover the bad debts of the financial elite by propping up zombie banks, while driving the Irish state closer to default, would be “a fatal mistake.” The Times insisted that such a policy was shortsighted and self-defeating, since sovereign defaults would trigger new financial panics and bankruptcies.

“It would,” the Times wrote, “keep the Irish people indentured to those who recklessly fund their banks: EFSF funds must, after all, be paid back by taxpayers. It would also give an official EU imprimatur on Europe’s dirty secret: public treasuries will do anything to make private bank creditors whole.”

What the Financial Times calls a “dirty secret” is hardly news to those who have followed developments since the collapse of Lehman Brothers 26 months ago. What is remarkable, however, is the bluntness with which this organ of British finance capital acknowledges the existence of a dictatorship of the banks over government policy throughout Europe. Nor is it any different in North America, South America, Africa or Asia.

The newspaper admits that a tiny financial elite, which it describes as “reckless,” is looting public treasuries in order to cover its speculative failures, reducing entire populations in the process to the status of “indentured” servants. It is this single-minded pursuit that drives the decisions of governments throughout Europe.

Regardless the nominal political coloration of a particular government—whether “left of center” (as the social democratic PASOK regime in Greece and the Fianna Fail government in Ireland) or “right of center” (as the Conservative-Liberal Democrat coalition in Britain and the Gaullist regime in France)—it takes its orders from the major banks. This is the meaning of the recurrent references by government leaders to “market realities.”

The Times’ acknowledgement of the “dirty secret” of bourgeois politics lifts the veil on the fraud of so-called democracy under capitalism. Governments uniformly pursue anti-social policies in defiance of popular opposition. The state is, as Marxism has long explained, the instrument of the corporate-financial ruling class for the suppression of the working class.

Over the past year, finance capital has intensified its offensive against the working class. The Irish events, following the Greek debt crisis of last spring, marks a new stage both in the objective crisis of world capitalism and the response of the ruling classes to this crisis.

Taking their cue from the United States, governments all over the world initially reacted to the financial crash of September 2008 by pumping trillions of dollars in public funds into their respective banking systems to prop up the major banks. This was the essence of the so-called “stimulus” programs enacted by governments around the world.

In part to prevent an uncontrolled collapse in consumption and a downward spiral into global deflation, and in part to provide political cover for the looting of public funds to rescue the financial aristocracy, governments enacted limited relief measures to minimally buffer the social impact of the recession. These measures enabled the ruling classes to buy time.

By the second half of 2009, however, when it was clear that the immediate threat of collapse had been averted, that the bankers and speculators would suffer no consequences for their semi-criminal activities, and that no serious financial reforms would be enacted, the stock markets bounced back, along with bank profits and CEO bonuses.

The most powerful financial firms were allowed by the political elites to emerge from the first stage of the crisis more dominant and wealthy than ever. Emboldened by these developments, at the end of 2009 global finance capital intensified its offensive, targeting Greece to establish a precedent for a global shift from stimulus to budget-cutting and austerity.

Last spring, under pressure from the banks and bond markets, the European Union adopted its program of austerity, launching historic attacks on what remains of the welfare state and all of the past social gains of the working class. The Irish crisis represents a new stage in this class-war offensive.

Its aim is a fundamental realignment of class relations worldwide. Whatever remains of welfare programs are to be obliterated. Wages in developed capitalist nations are to be slashed to a level comparable with low-wage “developing” countries. Conditions for the working class are to be rolled back to those which prevailed a century ago.

Such a social transformation cannot be carried out within the framework of the traditional methods of bourgeois democratic rule. In one country after another, workers and young people protesting against the budget cuts—in Greece, Portugal, Spain, France, Great Britain—have faced state repression.

An article in the Wall Street Journal this week, headlined “Crisis of Democracy Faces Euro Zone,” notes that the establishment of an EU-ECB-IMF troika dictating Irish economic policy means that the country’s “independence is no more than notional.” The author warns of the danger of social upheavals because “designing a new form of government that does not have democracy at its heart will anger voters and provide an opening to extremists.”

None of the measures being taken can resolve the crisis of the world capitalist system. More than two years on, it is clear that the crisis is not merely a conjunctural downturn, but rather a systemic crisis of the system as a whole. As in the 1930s, slump and austerity go hand in hand with ever more bitter international economic conflicts and the slide toward world war.

The global financial elite is on the offensive not because the working class accepts its demands. Workers in country after country have demonstrated their willingness to fight, carrying out mass strikes and protests. These struggles have to date been sabotaged and defeated because of the treachery of the trade unions and their allies in the official “left” parties and middle-class pseudo-left organizations.

New and greater struggles are coming. The critical issue is the building of a new leadership and new organizations of struggle, the fight for a socialist and internationalist program, and the development of revolutionary consciousness in the working class. This is the key to mobilizing the working class internationally to break the dictatorship of the banks and establish genuine democracy and social equality on a world scale.

World Socialist Web Site

Barry Grey is a frequent contributor to Global Research. Global Research Articles by Barry Grey

© Copyright Barry Grey , Global Research, 2010

Disclaimer: The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of the Centre for Research on Globalization. The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible or liable for any inaccurate or incorrect statements contained in this article.


© 2005-2017 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife