Greece & Thailand and Where Else?

COUNTERLIGHT

Let's remember that so many of the proposed financial aid plans for countries like Thailand and Greece are about rescuing investors who lost their bets. They certainly aren't about helping the people who actually live there. Some line is trotted out about their governments being irresponsible and corrupt, and that's probably true (true for the increasingly plutocratic USA and Europe), but why punish the people, who had to live under those governments, with austerity measures in the middle of the worst global depression since the 1930s?[...]

I raise my old socialist question again, whose economy is it?

WE'RE ROYALLY FUCKED

... by the cartel of financial institutions.

If you haven't read the Rolling Stone article Big Takeover by Matt Taibbi.

It's over — we're officially, royally fucked. no empire can survive being rendered a permanent laughingstock, which is what happened as of a few weeks ago, when the buffoons who have been running things in this country finally went one step too far. It happened when Treasury Secretary Timothy Geithner was forced to admit that he was once again going to have to stuff billions of taxpayer dollars into a dying insurance giant called AIG, itself a profound symbol of our national decline — a corporation that got rich insuring the concrete and steel of American industry in the country's heyday, only to destroy itself chasing phantom fortunes at the Wall Street card tables, like a dissolute nobleman gambling away the family estate in the waning days of the British Empire.

THE AIG KERFUFFLE: DECEPTION IS PART OF THE PLAN

Michael Hudson in Counterpunch

There are two questions that one always must ask when a political operation is being launched. First, qui bono -- who benefits? And second, why now? In my experience, timing almost always is the key to figuring out the dynamics at work.

Regarding qui bono, what does [sic] Sen. Schumer, Rep. Frank, Pres. Obama and other Wall Street sponsors gain from this public outcry? For starters, it depicts them as hard taskmasters of the banking and financial sector, not its lobbyists scurrying to execute one giveaway after another. So the AIG kerfuffle has muddied the water about where their political loyalties really lie. It enables them to strike a misleading pose – and hence to pose as “honest brokers” next time they dishonestly give away the next few trillion dollars to their major sponsors and campaign contributors.

Regarding the timing, I think I have answered that above. The uproar about AIG bonuses has effectively distracted attention from the AIG counterparties who received the $183 billion in Treasury giveaways. The “final” sum to be given to its counterparties has been rumored to be $250 billion, do Sen. Schumer, Rep. Frank and Pres. Obama still have a lot more work to do for Wall Street in the coming year or so.

To succeed in this work – while mitigating the public outrage already rising against the bad bailouts – they need to strike precisely the pose that they’re striking now. It is an exercise in deception.

The moral should be: The larger the crocodile tears shed over giving bonuses to AIG individuals (who seem to be largely on the healthy, bona fide insurance side of AIG’s business, not its hedge-fund Ponzi-scheme racket), the more they will distract public attention from the $180 billion giveaway, and the better they can position themselves to give away yet more government money (Treasury bonds and Federal Reserve deposits) to their favorite financial charities.

FAUX GESTURES OF OUTRAGE

Yesterday on Democracy Now! in its news recap:-- The failed insurance giant AIG is preparing to pay out $450 million in bonuses to top executives and other employees despite receiving a $173 billion government bailout.
...
On Sunday, Lawrence Summers, the director of the White House National Economic Council, described the bonuses as outrageous, but he said the bonuses are part of a contract:--

Lawrence Summers: “We are a country of law. There are contracts. The government cannot just abrogate contracts. Every legal step possible to limit those bonuses is being taken by Secretary Geithner and by the Federal Reserve system.”

Eli Stephens writes, Funny how that objection to abrogating contracts and the "very, very destabilizing consequences" doesn't come up when the contracts being abrogated are those with GM and Ford workers, or San Francisco Chronicle workers, or anyplace else where it's the workers who are suffering. Au contraire, it's precisely those cases where members of Congress actively call for the abrogation of contracts.

Just like "freedom of speech" belongs to those who own the presses and the airwaves, the "law" belongs to those who own the country. For the rest of us, it's a thin layer of ice which can be shattered at any moment.

On the car radio, I've listened to some of these call-in programs (c.f. "On Point"), and surely people are outraged, but the discussion doesn't go beyond that.

Richard Estes, telling it like it really is and what we might expect, Allow me to translate this for you: everything is going according to plan, right down to the faux outrage expressed by Geithner and Summers. Summers' reliance upon pre-existing contracts to justify inaction is particularly mendacious.
...
We are entering the early stages of this process, with capital retaining as many privileges as possible, despite the catastrophic failure of those who managed it, while the workers who have already been victimized, are called upon to sacrifice, even those with the contractual protections commonly utilized by bankers and investors. Will we eventually rebel? There is no sign of it. But if we do, how will Obama respond? Well, the Pentagon is already anticipating the deployment of troops to deal with domestic unrest.

LABEL: UNINTENTIONAL HUMOUR

For your immediate reflection, from the Guardian - "Is the recession David Bowie's fault?":- Who is to blame for the recession? Forget all that stuff about out-of-control bankers, negligent governments and sleepwalking regulators; instead, according to the BBC's Evan Davis, it's time to point the finger at David Bowie - a pioneer not only of experimental rock music and what used to be called "gender bending", but exactly the kind of financial sophistry that got us in this mess.

In yesterday's Daily Mirror, Davis laid out his theory as follows. In 1997, Bowie needed millions of pounds to buy back the rights to his songs from a previous manager. With the help of a financier named David Pullman, he thus created the so-called "Bowie Bond", through which investors would receive a share of the royalties from 287 Bowie songs over the next 10 years (£55m worth of them were sold to the Prudential Insurance Company).