8/3/2019 The great regression

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The great regressionIgnacio Ramonet

It is clear that there is, within the European Union (EU), no political will tostand up to the markets and resolve the crisis. Until now it had attributed thelamentable performance of European leaders to their overweening incompetence. Bu

t this explanation (just) not enough, especially after the recent "financial coup" that have ended in Greece and Italy, a certain conception of democracy. Obviously not just about mediocrity and incompetence, but of active complicity with the market.

What we call "markets"? In this group of investment banks, insurance companies,pension funds and hedge funds (hedge funds) that buy and sell essentially four types of assets: currencies, shares, bonds and derivatives States.

To get an idea of their colossal force is enough to compare two figures: each year,e real economy (enterprises of goods and services) creates, throughout the world, wealth (GDP) estimated at 45 trillion (1) euro. While, at the same time on a p

lanetary scale, in the financial sphere, the "markets" worth moving capital of 3,450 billion euros. That is, seventy-five times resulting in the real economy ...

Consequence: any national economy, however powerful (Italy is the eighth world economy), can withstand the assaults of the markets when they decide to attack ina coordinated manner, as they are doing for over a year against the European countries qualified contemptuously of PIIGS (pigs, in English): Portugal, Ireland,Italy, Greece and Spain.

What's worse is that, contrary to what one might think, these "markets" are notjust coming from some exotic forces distant horizon gentiles to attack our localeconomies. No. Most of the "attackers" are our own European banks (the same tha

t with our money, the EU states saved in 2008). To put it another way, not justU.S. funds, Chinese, Japanese, or Arabs who are attacking en masse to some countries in the euro area.

It is essentially an assault from within, coming from within. Directed by European banks themselves, European insurance companies, hedge funds in Europe, European pension funds, financial institutions that manage the savings Europeans for Europeans. They are the ones who have the main part of European sovereign debt (2). And who, to defend, in theory, the interests of their clients, they speculate, and increasing interest rates paid by States for debt, to carry several of them (Ireland, Portugal, Greece) on the verge of bankruptcy. With the subsequent punishment for citizens who must endure the austerity measures and the brutal adju

stments decided by European governments to appease the "markets" vultures, or their own banks ...

These institutions, moreover, readily available money the European Central Bankto 1.25% interest, and lend it to countries such as Spain or Italy, to 6.5% ...Hence the importance disproportionate and outrageous of the three major rating agencies (Fitch Ratings, Moody's and Standard & Poor's) because of the note of confidence attributed to a country (3) depends on the interest rate it will pay toobtain a credit from the markets. The lower the note, the higher the interest rate.

These agencies are not only wrong, particularly in their views on the subprime crisis led to the present, but in an environment like today, play a role execrabl

e and perverse. It is obvious that any plan of austerity cuts and adjustments within the euro zone will result in a decrease of growth rate, rating agencies rely on it to degrade the country note. Consequence: it must spend more money on de

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bt payments. Money will need to obtain further cut their budgets. With which economic activity will inevitably shrink and growth prospects. And then, again, theagencies will degrade your note ...

The infernal cycle of "war economy" explains why Greece's situation has deteriorated so dramatically as the government cuts multiplied and imposed a stiff austerity. In no sacrifice has served the citizens. Greece's debt has fallen to the l

evel of junk bonds.

In this way the markets have got what they wanted their own representatives directly access to power without having to submit to elections. Both Lucas Papademos, Prime Minister of Greece, as Mario Monti, President of the Council of Italy, are bankers. The two, one way or another, have worked for the U.S. bank Goldman Sachs, specializing in placing his men in positions of power (4). Both are also members of the Trilateral Commission.

These technocrats should be imposed, regardless socially, within the framework of a "limited democracy" measures (more privatization, more cuts, more sacrifices) that the market demands. And some political leaders have not dared to take for

fear of unpopularity that entails.

The European Union is the last territory in the world where the brutality of capitalism is weighted by social protection policies. That which we call the welfare state. The markets no longer tolerate it and want it demolished. That is the strategic mission of the technocrats who have access to the reins of government thanks to a new way of making power: the financial coup. Presented as well as compatible with democracy ...

It is unlikely that the technocrats of this "post-political era" unable to resolve the crisis (if your solution was technique, have been solved). What will happen when European citizens see that their sacrifices are in vain and that the recession is prolonged? What level of violence the protest? How do you keep order i

n the economy, in the minds and on the streets? Do establish a triple alliance between economic power, media power and military power? Will they become Europeandemocracies "authoritarian democracies"?

Notes

(1) One billion = a million million.

(2) In Spain, for example, 45% of sovereign debt held by banks themselves as Spanish, and two thirds of the remaining 55% are held by financial institutions from the rest of the European Union. This means that 77% of Spanish debt has been acquired by Europeans, and only the remaining 23% is held by foreign institutionsto the EU.

(3) The highest note is AAA in late November, had only a few countries in the world: Germany, Australia, Austria, Canada, Denmark, France, Finland, Netherlands,United Kingdom, Sweden and Switzerland. The U.S. note has been degraded, last August, to AA +. That of Spain is currently AA-, identical to that of Japan and China.

(4) In the U.S., Goldman Sachs and was able to place, for example, Robert Rubinas Treasury Secretary by President Clinton, and Henry Paulson in the same role in the cabinet of George W. Bush. The new European Central Bank president, MarioDraghi, was also vice chairman of Goldman Sachs in Europe from 2002 to 2005.