Tag Archives: Austerity Politics

Quote of the day

David Broad recently addressed the increasingly contentious political situation in Canada, one defined by the economic reactionaries and their work to impose an austerity regime on the country. He briefly characterized the situation thusly:

The Tories [in Canada] are also using trivial smoke and mirror tactics in trying to keep Canadians from focusing on austerity, such as playing up the budget announcement of doing away with the one cent piece, with mainstream journalists joking about being “penny pinched,” etc. But indications are that many Canadians will not be so easily fooled, especially as their circumstances deteriorate. The majority of Canadian voters did not vote for and do not support the Harper Tories. Strikes and other trade union actions are on the rise in Canada, Aboriginal peoples are becoming more vocal, Canadian youth have been participating in the Occupy Movement, and students in Quebec have risen up to oppose postsecondary tuition increases. Conservatives are quick to chant that Quebec has the lowest tuition in Canada, not wanting us to consider that perhaps postsecondary education should be free for all. Conservatives are also working to vilify all youth activists, using youth “riots” as an excuse, denying that such “riots” are not simply senseless vandalism but only understandable as the frustrations of discouraged young people who see a society that has little future for them.

Peter Gelderloos provides an anarchist account of Spain’s general strike

Spain Fights Austerity » Counterpunch: Tells the Facts, Names the Names.

A choice passage:

The Spanish state had every reason to fear that this next general strike would further intensify ongoing social struggles. Given that more people were even angrier in March 2012 than they had been in September 2010, the strike could easily transform into rioting in at least a couple cities and could even spark unrest of a more insurrectionary character. The major unions also feared another general strike, because it likely meant losing control as they had in September 2010; nonetheless, they were obliged to take at least the resemblance of a stand if only to save face. As much as the governing institutions might have wanted to suppress it, the next general strike was an inevitability, given the aggressiveness of the latest Labor Reform introduced by the conservative Popular Party.

Whereas dictatorship dissuades protest by attacking it, democracy controls protest by managing it. Institutions from the Left to the pinnacle of power colluded to organize a strike without hope of succeeding. To start with, CCOO and UGT called the strike with just three weeks advance notice, signing on to a call-out made by two minor unions in Galicia and the Basque country and turning it into the countrywide general strike that everyone knew was coming. CCOO and UGT are largely recognized as bureaucratic, opportunistic unions that tame rebellion in exchange for government funding. They were clearly surpassed by the events of the 2010 general strike, when they made the mistake of convening months in advance, giving anarchosyndicalist unions like the CNT and CGT, or new organizational spaces like the neighborhood assemblies of Barcelona, time to make their own plans.

This time, the strike preparations by CCOO and UGT were minimal to the point of invisibility. Not only did these two major unions leave scant time to organize, they hardly put up any propaganda in favor of the strike until the day before, leaving the field open for the media to color public opinion.  And the media went into overdrive, raising fears of violent picketers trashing any shop that remained open, emphasizing the inconveniences a strike would cause to commuters, consumers, and tourists, and championing the right to work. The very concept of an economic shutdown was presented as a totalitarian coercion and a violation of individual rights. In the view spread by the media, a legitimate strike could go no further than a peaceful protest. Several media outlets openly denounced the strike or published surveys showing that very few people would actually participate.

But when March 29 arrived, Spain slowed down almost to a halt.

We live in the best of all possible worlds….

A vulture stalks a girl in the Sudan

Jeff Madrick observes:

Why are mainstream economists, right and left, so determined to push back any attempt to subsidize manufacturing in America? The question will arise anew tonight when President Obama presents his budget, complete with tax provisions to support manufacturing. After the president addressed the issue as his first topic in the State of the Union a couple of weeks ago, many esteemed economists seemed to rush to the offense. Obama proposed using tax carrots and sticks to encourage manufacturers to stay here, return here, or get out of those low-wage emerging markets. Some mainstreamers, seeming to represent the conventional wisdom among them, openly scorned the idea. At least one, Laura Tyson, has stood her ground in favor of a policy focus on manufacturing.

I understand the mainstream economic reflex. After working so hard to get world nations to reduce trade barriers for the last 40 to 50 years, they and their successors view subsidizing manufacturing in the U.S. as a retreat. It could provoke retaliation as well. And moving the world toward free trade makes eminently good theoretical sense — to a degree. The anti-manufacturing subsidy bias is really a subset of the firm, almost unshakable allegiance to free trade theory among the American mainstream.

I also understand the mainstream neoclassical reflex, having taken a few of those courses. Indeed, sometimes I am a neoclassical myself. When you fundamentally believe that economies adjust efficiently, and that the markets will decide, if left unimpeded, which industries should naturally rise and fall, it is profoundly difficult to accept tinkering with matters unless very much warranted. If manufacturing is declining in America, the conventional thinkers say it is largely because first, the same business can be done more efficiently elsewhere, or second, American business has better places to put its money, usually by investing in services-oriented industries, some of them highly sophisticated. There may be manufacturing “market failures” to compensate for, but probably not many.

The relevant phrase in the above: “fundamentally believe.” Market fundamentalists in the United States have long-supported the partial destruction of the American manufacturing sector. Unfortunately, market fundamentalism now defines the orthodox position in the economics profession as a whole. Free trade is, fundamentalists believe, intrinsically rational. The world economic system, one which mostly reflects market fundamentalist orthodoxy, is now in such a state that popular contestation and overt rebellion are normal, and the opposition is motivated to a greater or lesser degree by austerity regimes informed by market fundamentalist principles. Presumably, these protests are irrational since they oppose in some way free trade policies.

One may reasonably doubt the rationality of a economic system that necessarily produces such suffering.

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What safety net?

As Matt Yglesias points out, a President Romney intends to follow an austerity program with respect to the poor. Romney, Yglesias asserts:

…wants to cut the safety net, cut the health care part of the safety net, muck around with the federal workforce, and then cut the non-health care part of the safety net. To further clarify, he states that he “will immediately move to cut spending and cap it at 20 percent of GDP” while increasing defense spending. Which is to say he wants to cut social safety net spending. What’s more “as spending comes under control, he will pursue further cuts that would allow caps to be set even lower so as to guarantee future fiscal stability,” thus cutting social safety net spending even further.

Chutzpah!

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