An uncivil war

South Africans decisively elected the African National Congress to  power in five elections since 1994 – only to be fleeced in return. For more than a generation the government in Westminster – irrespective of configuration – has shamefully serviced an elite bent on looting the nation. It’s been a good time for One Percent and Co but the winds of change are blowing, home and away.

Sisonke Msimang says in South Africa the adoration years are over.

Your role in the revolution will not save you. Your history of speech-making and sleeping in a cold detention cell will not save you. Not even back-breaking labour on Robben Island will spare you the scepticism of today’s champions of freedom…Across class lines and across geographies, there is a fresh and bruising defiance brewing. In my country the young ones think the ruling party representatives who quell protests with promises are a joke. They think the main opposition which stands for ‘free enterprise,’ is a joke. They think that white liberals who question their intellect while pretending not to are a joke. The rich are a joke. Poverty is a joke. Everything is a joke and yet nothing is funny. It is all very serious.

Bitter reality has broken the spell of Madiba and Rainbowism. Since the ANC flounced to power in 1994 life expectancy for blacks has fallen by ten years. Twenty percent of the population live in extreme poverty, only 40% have regular work and youth unemployment approaches 60%. The average income of whites is eight times higher than blacks and inequality has soared.The top 10% hold 75% of wealth; last year the two richest people earned more than the poorest 50%.

And so:

 The young ones simply have no fucks left to give...They are not interested in those who parse their words and calibrate and operate within the logics of inherited and inherent authority…The young ones have grown up under so-called democracies and so they know that the rules of this dispensation are subject to manipulation…In my country there is an interregnum and if we connect the dots perhaps we can see that there is one in yours as well. Perhaps for you too it is one in which the young are finding their feet and will soon hit their stride.

In Britain the young ones have unnerved the establishment by electing Jeremy Corbyn – a  socialist –  as leader of the opposition Labour Party in Westminster. Corbyn is intent on building a popular movement to break the neoliberal consensus that has made parliament a lackey of the rich and powerful.

Our opposition cannot be limited to the parliamentary chambers and TV studios of Westminster. Labour is best when it is a movement, and that movement has swelled to an enthusiastic 600,000 who will decide this leadership election. Once that is over, we face a bigger task: to force this government to abandon its free-market dogma and become the strategic state our society needs.

William Bowles headed the Election Information Unit for South Africa’s historic 1994 elections. Perhaps he’s been disillusioned by the experience of working for the ANC.

Think about it. Transform the Labour Party into a vehicle to promote a new socialist vision? Who is kidding who here?…  Jeremy Corbyn is not the solution, if anything he’s a symptom of the malaise that is our degenerate, late capitalism. Sitting in Parliament for thirty years and aside from attending the odd demo and signing petitions, he has grandstanded the rise of the corporate-security state (Fascism) in a political party that long ago gave up any pretense at being socialist, or even dreaming about the idea. JC is a fully paid member of the professional political class….

Bowles argues it is a fantasy to think that a Labour government could abolish capitalism from Westminster.

Any future Labour government, just like Syriza in Greece or Podomos in Spain, will have to contend with an all powerful international capitalist elite, that thinks nothing of destroying entire economies let alone entire countries. How many, do you think, of Corbyn’s ‘reforms’ can survive into this mythical future? At best, it’s just a rehash of the old ‘lesser of two evils’ position that many on the left have been conned into supporting, including myself. At worst, and this I think is crucial, it could well lead to an even more cynical public when they see that this new Emperor too has no clothes.

The ANC and Syriza were not crushed by international capital, displaced by a colour revolution or dislodged by R2P benevolence. There was no need. Like the Labour Party they were quite willing to prosecute a class-war against the poor on behalf of their patrons. British politics mirrors the apartheid landscape I knew, just before the ‘Durban Moment’ resurrected black protest after a decade of lock-down. It was as unexpected and equally inevitable as the Corbyn Moment. Here’s Penny Laurie in the New Statesman.

Today’s voters are not the voters of 1997 or 2005. We are digital and post-geographic; we mobilise fast and we want more. We are not wedded to the electoral machine. Our disenfranchisement has been mistaken for apathy for too long by a political class that claims to want young people to vote but turns out to want young people to do as they’re told and vote for it or not at all. We want someone to remember that democracy does not begin and end at the ballot box. We want someone to represent the interests of the young, the poor and the marginalised in parliament. These are simple, modest demands. And the most damning indictment on the British political machine is the way in which these simple, modest demands look like a revolution.

Prime Minister David Cameron, declared Corbyn a threat to national security  amidst revelations that he sang The Red FlagBBC political editor Laura Kuennsberg pissed her pants over his reluctance to mime the national anthem or kiss the Queen’s hand. She did it all over again extracting a confession he would not press the nuclear button if he became prime minister.

There is of course no declared nuclear power that Britain can nuke without ensuring the obliteration of the island and its natives. And Trident is no protection at all against Israel’s estimated 400 nuclear warheads which can now also be launched from 6 submarines provided by Germany. Far better to pay £100 billion for a papier mache model of Trident, and give displaced workers time to read-up on Fukushima and the use of depleted uranium in Iraq.

Alternatively, with Russia scuppering plans for regime change in Syria and the Ukraine – and threatening Western hegemony –  now’s the time for David Cameron to hit the button in defence of the nation. Go get him Laura. If Corbyn becomes PM peace could break out!

Capitalism is a protection racket run by bankers and corporations. Governments and the commentariat provide cover. The ‘system’ has nothing to do with economics, if by that we mean attending to the needs of society and caring for the planet on which we depend. Austerity in both South Africa and Britain is simply an excuse for transferring national income, resources and assets to the already fabulously wealthy. The obsession with  budget deficits and the public debt is simply austerity spin. Anthropologist David Graeber says:

Ever since the creation of modern central banking systems at the end of the 17th century all governments have maintained a national debt and all politicians have spoken as if they shouldn’t have one. They all agree that we should balance our books and the national debt should ultimately be repaid. In fact on the few occasions when a government has achieved a budget surplus and begun to repay a significant portion of the national debt the results have invariably been disastrous…Modern money is just a collection of circulating IOUs. Governments create money by borrowing from banks and banks issue IOUs. These IOUs are what we call money. If there was no national debt governments would not have to borrow from banks and banks would have to create all the money themselves through private loans. But there simply aren’t enough private borrowers. As a result if the government stopped borrowing money the money supply itself would collapse.

Still, based on the entirely false analogy of the state as a household, Britons are glibly told that tightening their belts is the only way to ensure future prosperity. At the same time banks are being provided with cheap money in the hope they will increase loans and stimulate economic activity. In a piece for the World Socialist Web Site in January this year, Nick Beams explained why Quantitative Easing only works for the obscenely rich.

The real reason for falling consumption demand is the suppression of wages, coupled with the creation of mass unemployment—running at more than 11 percent in the euro zone—and the austerity programs being carried out by all European governments….In fact, as the experience of the American QE program shows, the effect of pumping more money into the financial system is to promote further speculation in financial markets. The US Federal Reserve’s balance sheet has expanded from around $800 billion in 2008 to more than $4 trillion today. US equity markets are at or near record highs, yet investment in the real economy remains at historically low levels. Having made vast fortunes out of the US Fed’s QE program, financial markets are demanding that it be extended to Europe…The markets expect that more ultra-cheap money will be made available for financial speculation, thereby increasing the vast fortunes of the ultra-wealthy few.

Beams highlights an Oxfam report which predicts (on present trends) that the richest 1 percent will hold more than 50 percent of global wealth next year. Last year they merely owned 48 percent.This remarkable surge in wealth coincided with the acceleration of quantitative easing in 2010 by the US Fed and the Bank of England. Corbyn has suggested the creation of a public bank to invest directly into the economy to get around the problem. BBC Economics Editor, Robert Peston, is not impressed.

One criticism levelled at Jeremy Corbyn and his shadow chancellor John McDonnell both by the Tories and centrist members of his own party is that they are left-wing dinosaurs.They’ve today gone some way to answering that charge by  recruiting some of the world’s most influential left-wing economists to an advisory panel.The panel includes Joe Stiglitz, the US Nobel prize-winner, Simon Wren-Lewis, Mariana Mazzucato, Danny Blanchflower and Thomas Piketty. These are economists who’ve written powerfully about the need for new taxes, especially on the wealth of the rich …And they are all opponents of austerity, or public spending cuts in a recession.

Here’s the sting in the tale.

The composition of the panel probably also tells us that the ultra formulation of “quantitative easing for people not banks” – till now seen as the quintessence of Corbynomics – is dead. Or to put it another way, this group of economists would not sign up to a policy of the Bank of England providing cheap loans to a new state investment bank on a permanent continuous basis – for fear that the anti-inflationary credentials of the Bank of England would be destroyed.

Author Ellen Brown says dire warnings of hyperinflation are bogus; QE has been going since the 1990s without this happening.

The rich are getting richer from bank bailouts and very low interest rates, but the money is not going into the real economy, which remains starved of the funds necessary to create the demand that would create jobs. To be effective for that purpose, a helicopter drop of money would need to fall directly into the wallets of consumers. Far from being “undisciplined fiscal policy,” getting some new money into the real economy is imperative for getting it moving again… The vast majority of the money supply comes into circulation in the form of bank loans, as the Bank of England recently acknowledged. Banks create the principal but not the interest necessary to repay their loans, leaving a “debt overhang” that requires the creation of ever more debt in an attempt to close the gap. The gap can only be closed in a sustainable way with some sort of debt-free, interest-free money dropped directly into consumers’ wallets, ideally in the form of a national dividend paid by the Treasury…Corbyn’s proposal is needed, it will work, and it is an idea whose time has come.

Britain spends about £51 billion annually – more than the education budget – just to service the national debt. Some £165m is paid every day in interest on personal loans alone (not including mortgages), and a total of £213bn a year in interest on all debts. Quite obviously inflationary pressures are a red herring. Ensuring bankers continue to cream the economy by their monopoly of the money franchise is the real objective.That in a nutshell is the spectacular banking scam that holds the world to ransom.

In 1894, Jacob Coxey and his Industrial Army of destitute unemployed men marched from Ohio to Washington to urge Congress to issue debt-free government notes. These federal dollars, “Greenbacks” had been used successfully during the Civil War. Coxey proposed Congress issue $500 million in Greenbacks to redeem Federal debt and provide work on public projects. Jacob’s march became a monetary parable in “The Wizard of Oz” written by journalist and Populist, Frank Baum.

In her book Web of Debt, Ellen Brown says: ‘Few of the millions who have enjoyed this charming tale have suspected that its imagery was drawn from that most obscure and tedious of subjects, banking and finance. Fewer still have suspected that the real-life folk heroes who inspired its plot may actually have the answer to the financial crisis facing the country today.”

Millions in South Africa are forced to live in squalor and misery while Britons are consigned in increasing numbers to the precariat. None of this is in the least necessary. Nations could finance their own development and work miracles overnight if they cut out the private banks and issued their own currency.

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3 thoughts on “An uncivil war

  1. Another masterful forensic diagnosis of our current economic and political malaise, complete with the cure!

    None of this is in the least necessary. Nations could finance their own development and work miracles overnight if they cut out the private banks and issued their own currency.

    The reason the cure can never be implemented is, of course, because only about 0.0001 percent of the Great British Public will ever read this blog. The vast majority of the remaining 99.9999 percent will carry on believing that the government controls the money supply, not a handful of the mega-rich whose only interest is improving their own fortunes at the expense of everyone else.

    How different it would be if our publicly-funded broadcaster, the BBC, protected the public interest by reporting just a little bit of this kind of analysis in an unbiased, impartial way instead of sneering and ladling it with contempt and abuse.

    But that can never happen, because the Chair of the BBC Trust is a Director of one of the world’s largest private banks, HSBC, and any BBC employee who dares think that cutting out the private banks might be worth a try is quickly shown the door.

    That’s good old British impartiality for you!

    Liked by 1 person

  2. An insightful analysis of our present economic lot! I listened with increasing horror ro Jeremy Hunt and Teresa May yesterday at the Tory conference. Despite the fact many commentators have pulled their arguments to pieces and even the Sun has waded in, the fight for the Right seems to be in full ‘puffed up’ swing. My only hope is that more and more people around the world are glimpsing the true picture and starting to push in the opposite direction. It’s slow, but it’s something.

    Liked by 1 person

  3. The really frightening thing now is that no matter how many commentators pull their arguments to pieces and no matter how irrational and nonsensical their arguments are, it makes no difference. Just as long as they dress the part and keep smiling the public thinks it’s all OK.

    Liked by 1 person

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