On average, why do you not give your $2 (or £1) to the junk sitting at the entrance to the underground? Why are you hesitant to give the same to the drunk half passed out on the street? This is not a question of morale, or on the idea that you might have a ‘Samaritan’ bone in your body. This is purely human nature, we all do ‘good’ things at times, we give to the red cross, the Salvo’s, yet when we know that the money will go into health endangering acts, like money so the junk can buy more drugs, how do we feel then?
I tend to not give any!
I do my share, the daffodil, the heart foundation, starlight, legacy; the list goes on for a while. I do not give a boatload, but I definitely spend dollars on good causes. These causes make sense and I feel that there is a moral obligation to do things for those less fortunate than me. Yet, knowing a junk will buy more drugs stops me from giving, and yes there are no exceptions. I do not think my way of thinking is out there, many follow my lead. So why do I read ‘Poor nations ‘pushed into new debt crisis’‘ (at http://www.theguardian.com/business/2014/oct/10/poor-nations-debt-crisis-developing-countries), how moronic (read: overly simplified silly) is the act of giving loans to a group that cannot control a budget? When we see “Jubilee Debt Campaign says as many as two-thirds of 43 developing countries it analysed are at risk over next decade” as well as “Coinciding with the World Bank’s annual meeting in Washington, the anti-poverty campaigners accuse the international lender and other public bodies of “leading the lending boom” to poor countries without checking how repaying debts will divert resources from cutting poverty“. I would change that in how can we make international lender accountable for their own bad choices?
Not unlike Wonga ruling (at http://www.theguardian.com/money/2014/oct/03/payday-lenders-repay-loans-wonga), these nations should get those loans expunged and the international lenders will just lose their money. They will of course disagree, but the entire loan issue is getting massively out of hand and those enabling them get paid no matter what. This needs to stop.
Sarah-Jayne Clifton, director of the Jubilee Debt Campaign, makes a good case, yet overall she is not willing to far enough on one side and is treading where she should not on the other side. Let me explain this. At the end, the quote is “As such, the campaigners are urging the UK government to push for policies that support developing countries in increasing their tax revenues by clamping down on tax avoidance and evasion“.
No, no, no, no, no! That is not a good idea!
Pushing for policies tends to be a slippery slope (even though the approach is not that bad), in addition, the issue with developing countries and their tax push is only one side, which is the wrong side. These developing countries need to take a hard look on what they are spending these loans on and WHO they are enabling in the first place.
Let’s take a look at a few quotes from the past years and see how they fit in: “Ana Olivera took office on Friday promising to streamline the overweight administration of Uruguay’s capital“. Seems like a good approach. It must sting the Americans to no end that the elected official is a communist. OK, Ana Olivera is only mayor of Montevideo, but that village contains well over 50% of the population of that entire nation, which gives the mayor loads of political power. Uruguay is sometimes called the Netherlands of Latin America, because of its social approach, yet Uruguay is almost 5 times the size of the Netherlands and a mere ferry ride away from Buenos Aires (in case you want to have some cosmopolitan fun). There is method to my madness and here it comes. When we see the news in the International Business Times (at http://www.ibtimes.com/uruguays-economy-will-struggle-unemployment-inflation-it-will-grow-4-percent-2014-1540214), an article from last January where we see that some nations can get a decent grip on their debts, although inflation remains a worry for now. Bloomberg had some additional issues (at http://www.bloomberg.com/news/2014-02-19/uruguay-s-growth-pushing-inflation-above-target-bergara-says.html), “Uruguay, a nation of 3.3 million people wedged between South America’s two largest economies, has since become less dependent on trade with Argentina“, it gives rise to worry about inflation, yet it seems that they are staying on top of it for now.
This links back to the other ‘poor’ nations. These players seem to be given an unofficial charter of bad financial management. If it were just one or two issues, no! When we see the report that two thirds is in the high risk zone of getting a new debt crises, even though most of them got their debts written off, we can clearly see the proverbial pattern of junkies. This of course makes for the analogy that it turns the international lender as a debt dealer at best and as a debt pusher at worst. So, here we see my part of disagreeing with Sarah-Jayne Clifton. We need to put into place clear policies on how loans are to be allowed in the first place. How these nations are currently held to account (and accountable)! If we see a structural failing, then we have a duty to deal with that weakness and deal with the implied ‘pain’ from such irresponsible actions. Yet, governments and ‘overseers’ of these lending institutions seem not to be willing to do just that, we can assume we know the reason, but that is just listening to gossip ;-).
However, as I go for the expression of being artistic, there is this story about being black and that story is played by a pot and a kettle. How can we push for responsible, budgeted governing when the big players involved seem to be unable to do just that (USA, United Kingdom and Australia, but to name a few). Is it truly conspiracy theory inclined to claim that governments are over enabling banks and financial institutions? I am very willing to accept that I am wrong here, but the numbers all speak into my favour (towards my train of thought), so what is the link?
Consider the impact of Neoliberalism. Consider how the term changed usage and to a certain effect the value and application from the 1930’s, the 1980’s and it seems that the concept is changing again. In the 30’s it came from a desire to avoid repetitive economic failures that were visible up to the early 1930s, this resulted in the gesture of blame towards economic policy of ‘classical’ liberalism. Then later on it had shifted in meaning from a moderate form of liberalism to the radical and privately held transactions between parties, set in a ‘free’ (read: unaccountable) environment, free from intrusive government restrictions, tariffs, and subsidised capitalist set of ideas. Is it not interesting how this version as we see it now, is all about what it was with added non taxability and non-accountability? It is a new form of Neoliberalism with a twist that is all about enabling the wealth driven and the wealth begotten, yet in that view neo liberalism is not just a ‘new’ kind of liberalism, it is not just based on ‘old’ values of civil rights, freedom of the press, freedom of religion, and free trade. It is enabling non-accountability, non-taxation and even non-prosecutable to a certain extent. So the freedom they have been given are evolving into a total form of freedom where they obscure, device and decide, whilst the people get saddled with the bill of their appointed exploitation.
How is that liberal in any way, shape or form?
There is none more part we can look at. It comes from the paper ‘Neoliberalism and the Global Financial Crisis’ by Sharon Beder (at http://www.uow.edu.au/~sharonb/GFC.html).
The paper has a very fitting part where the topic headline reads ‘Financial Market Coercion‘ and we see “Whilst the IMF and the World Bank enforced the Washington Consensus on poorer countries in desperate need of capital, other more affluent countries were forced into adopting the same formula by the world’s financial markets. Their vulnerability to these markets was facilitated by financial deregulation“. This is what we see in action. Additional we see: “Financial deregulation was demanded by business interests, particularly large financial firms and transnational corporations that wanted to be free to move their money around. The economic argument for financial deregulation, supplied by free market think tanks and economic advisors, was that the free and unregulated movement of capital is more efficient, because capital can move to where it gets the best returns (Helleiner 1996, 194, Bell 1997, 103-4).”
Yet in that part, it does not state the one issue that is massively in play for governments on a global level. This is read in the part “free and unregulated movement of capital is more efficient, because capital can move to where it gets the best returns“, but what is does not state, which it should “free and unregulated movement of capital is more efficient, because capital can move to where it gets the best returns, absolvent of taxation and financial duties“. Now we get back to these ‘poor’ nations. Yes, they are getting pushed into new debt crises, as the facilitating business branches are all about getting money out and not paying for taxation which was enabled by neoliberalism (their altered version of) as I see it.
Is it not an interesting part that we now see the scary view that a Uruguayan communist shows more social responsibility then the ‘free west’ has shown in the last decade?
As I stated it before, when you make banks and big business the facilitator for the future, you will see that their only future you end up with is their own selfish needs. This is why the push for policies by Sarah-Jayne Clifton worried me; she might end up giving the keys to that group of people that should never have access to the keys in the first place, not if a nation wants to do anything for its people. Is there a better solution? It seems that either we go the Uruguayan way and deal with inflation dangers, yet the other way is equally drenched in risks and dangers. The first order is to set up the right policies that keep large corporations tax accountable. They might ‘threaten’ to walk away and to go to Paris or something like that, yet a nation has a multi-million consumers market. If a firm cannot do business, in the end, they stop from being a business and someone else steps in. We need to stop the greed that these investors represent. I am however at a loss to give a clear answer of what will actually work. There are too many variables and not enough people ready to stand up for that what must be decided upon, so we stay in an impasse, a status quo that had stopped being just that years ago, we just do not see clearly how much we lose every day, so we continue the status quo as is.
Lawrence van Rijn - Law Lord to be 