Quote of the day

Jodi Dean calls for a debt strike:

A debtors’ strike is about using the power that debt gives to people to demand concessions.

There are, however, obvious difficulties. To begin with, the stigma that debt holds must be overcome. The idea of refusing to repay a loan seems offensive. If you sign a contract, it’s your moral – not to mention legal — duty to pay it back. However, this misses the fact that debt is a political, and not a personal, issue.

Climbing private indebtedness is the outcome of a deliberate strategy on the part of banks and a wilful [sic] impotence on the part of government. Banks developed, sold, and lobbied against the regulation of corrosive debt instruments. They cannot, then, demand that the rest of the population bleed so they can maintain their practises. When the creditor-debtor relation is seen properly, as a socio-economic arrangement, negotiation becomes a fact, as well as an economic necessity.

The next problem is building a movement big enough. A one-man debt strike is as useless as a one-man labour strike, but the quest for a mass debt strike may actually be more plausible.

Indeed. Building a massive network — that is, generating popular solidarity — is always the first task opponents of the current system must complete before they and their movement solve the compelling problems of the day.

The reasons for seeking to achieve a debt strike are obvious — especially obvious to the debt-ridden.

A photo taken in Poland during the time (1980) of Solidarność

Quote of the day

Michael Hudson wrote:

The easiest way to understand Europe’s financial crisis is to look at the solutions being proposed to resolve it. They are a banker’s dream, a grab bag of giveaways that few voters would be likely to approve in a democratic referendum. Bank strategists learned not to risk submitting their plans to democratic vote after Icelanders twice refused in 2010-11 to approve their government’s capitulation to pay Britain and the Netherlands for losses run up by badly regulated Icelandic banks operating abroad. Lacking such a referendum, mass demonstrations were the only way for Greek voters to register their opposition to the €50 billion in privatization sell-offs demanded by the European Central Bank (ECB) in autumn 2011.

Hudson follows this passage by making a case for the euthanasia of the rentier class (Keynes) and for fiat money. To be sure, his solutions are as politically improbable as they are humanly necessary.

Steve Fraser discusses Occupy Wall Street, its historical precedents and its current significance

Writing for TomDispatch, Steve Fraser, a historian of labor and Wall Street as well as a publisher of important books, recently provided his readers with a capsule history of America’s resistance to American finance capital. His article is worth reading.

Fraser begins by asserting that:

Occupy Wall Street…may be a game-changer. If so, it couldn’t be more appropriate or more in the American grain that, when the game changed, Wall Street was directly in the sights of the protesters.

The fact is that the end of the world as we’ve known it has been taking place all around us for some time. Until recently, however, thickets of political verbiage about cutting this and taxing that, about the glories of “job creators” and the need to preserve “the American dream,” have obscured what was hiding in plain sight — that street of streets, known to generations of our ancestors as “the street of torments.”

After an absence of well over half a century, Wall Street is back, center stage, as the preferred American icon of revulsion, a status it held for a fair share of our history. And we can thank a small bunch of campers in Manhattan’s Zuccotti Park for hooking us up to a venerable tradition of resistance and rebellion.

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Reactionary economics is a kind of war-making

Michael Hudson provides a brief case study of this kind of war craft while describing the Greek crisis:

The fight for Europe’s future is being waged in Athens and other Greek cities to resist financial demands that are the 21st century’s version of an outright military attack. The threat of bank overlordship is not the kind of economy-killing policy that affords opportunities for heroism in armed battle, to be sure. Destructive financial policies are more like an exercise in the banality of evil — in this case, the pro-creditor assumptions of the European Central Bank (ECB), EU and IMF (egged on by the U.S. Treasury).

As Vladimir Putin pointed out some years ago, the neoliberal reforms put in Boris Yeltsin’s hands by the Harvard Boys in the 1990s caused Russia to suffer lower birth rates, shortening life spans and emigration — the greatest loss in population growth since World War II. Capital flight is another consequence of financial austerity. The ECB’s proposed “solution” to Greece’s debt problem is thus self-defeating. It only buys time for the ECB to take on yet more Greek government debt, leaving all EU taxpayers to get the bill. It is to avoid this shift of bank losses onto taxpayers that Angela Merkel in Germany has insisted that private bondholders must absorb some of the loss resulting from their bad investments.

Popular protest in Greece

The bankers are trying to get a windfall by using the debt hammer to achieve what warfare did in times past. They are demanding privatization of public assets (on credit, with tax deductibility for interest so as to leave more cash flow to pay the bankers). This transfer of land, public utilities and interest as financial booty and tribute to creditor economies is what makes financial austerity like war in its effect.

I am sure it is difficult to produce a Hollywood epic of Greek farmers struggling to survive a blow that begins and ends with a stroke of a pen.

I also do not believe it wrong to identify this kind of elite economic activity as a kind of primitive or original accumulation. I believe it is uncontroversial to assert that the European Bankers and their allies in the United States want to restructure the Greek economy in order to exclude some in Greece from the material benefits they have had in the past and to accumulate capital by exploiting the political, legal and economic conditions in Greece, Europe and the world at large. This manner of capital accumulation may rightly be characterized as a kind of looting, that is, as an expropriation meant, in part, to change the character of economic exploitation in Greece. It is an instance of primitive or original accumulation because it will likely end with a new economic regime in Greece, a regime that will reflect the political capacities and economic requirements of some finance capitalists.

Hudson gives this advice to the Greek people who have been excluded from the elite bargaining over Greece’s future:

The most effective tactic is to demand a national referendum on whether to accept the ECB’s terms for austerity, tax increases, public spending cutbacks and selloffs. This is how Iceland’s president stopped his country’s Social Democratic leadership from committing the economy to ruinous (and legally unnecessary) payments to Gordon Brown’s Labour Party demands and those of the Dutch for the Icesave and even the Kaupthing bailouts.

Use of the direct democratic mechanism is the best feasible and effective path to block this attack on Greece and its people. Revolution is the only rational alternative to the victims of this looting effort if the institutions of a modern democracy were to fail to secure the rights and well-being of the Greek people. Resignation and suffering combine to provide the irrational alternative.