Upcoming Events

National | Housing

no events match your query!

New Events

National

no events posted in last week

Blog Feeds

Anti-Empire

Anti-Empire

offsite link Tulsi Gabbard Urges Donald Trump to Pard... Sun Nov 29, 2020 07:00 | Darragh Rocheo

offsite link The Insufferable George Clooney and the ... Sat Nov 28, 2020 23:08 | Frank Furedi

offsite link What I Learned From Riding With the Boog... Sat Nov 28, 2020 20:30 | Stanton Sharpe

offsite link The Media’s Covid War on the Dakotas Sat Nov 28, 2020 18:40 | Michael Fumento

offsite link Previously Russia’s Biggest Doomsayer,... Sat Nov 28, 2020 06:27 | TASS

Anti-Empire >>

The Saker
A bird's eye view of the vineyard

offsite link The AngloZionists are trying to provoke a war with Iran Sat Nov 28, 2020 20:36 | The Saker
There is really nothing particularly complicated about what just happened: the AngloZionists have murdered a top Iranian scientist in the hope that this murder will trigger a war.  The Iranians

offsite link NATO ? A Comatose Body Whose ?Mission? Seems To Be Little More Than To Preserve And Expand Itself... Sat Nov 28, 2020 18:16 | amarynth
By Francis Lee for the Saker Blog PART 1. In 1851, France had the misfortune to fall victim to a coup by the nephew of Napoleon Bonaparte, Charles-Louis Napoléon Bonaparte,

offsite link Moveable Feast Cafe 2020/11/28 ? Open Thread Sat Nov 28, 2020 17:00 | Herb Swanson
2020/11/28 17:00:02Welcome to the ‘Moveable Feast Cafe’. The ‘Moveable Feast’ is an open thread where readers can post wide ranging observations, articles, rants, off topic and have animate discussions of

offsite link War Ended, But Armenia Still Suffers Losses. Azerbaijani Troops Enter Largest Armenian Gold Mine Fri Nov 27, 2020 18:30 | amarynth
South Front This week, the Armenian leadership has reached an unprecedented height in its state management achievements. Prime Minsiter Nikol Pashinayan and his government did not stop at the successful

offsite link Meet the new boss! Fri Nov 27, 2020 17:39 | The Saker

The Saker >>

Public Inquiry
Interested in maladministration. Estd. 2005

offsite link David Quinn’s selective tolerance

offsite link A Woulfe in judges clothing Anthony

offsite link Sarah McInerney and political impartiality Anthony

offsite link Did RTE journalists collude against Sinn Fein? Anthony

offsite link Irish Examiner bias Anthony

Public Inquiry >>

What is the real cause of the capitalist crisis?

category national | housing | news report author Friday November 28, 2008 14:40author by Paul Bowman - WSM - Workers Solidarity 106author email wsm_ireland at yahoo dot com Report this post to the editors

Crisis, What Crisis? - Pyramids not houses

The official story is that the origins of the current crisis lie in the collapse of the US subprime mortgage market - i.e. poor people not paying their mortgages. Although this may have been the trigger event, it is not the real cause. The real cause lies in pyramids not houses. Specifically the enormous debt pyramid built up by the Western countries, particularly those following the Anglo-saxon economic model - which, unfortunately for us, includes Ireland.

The financial framework constructed to support the globalisation of trade and production, has enabled the growth of a huge, unregulated credit sector known as the “Shadow Baking System” which has allowed the ballooning of credit not backed up by any capital reserves.

Now this system is collapsing and banks are having to take the bad debts back onto their balance sheets. This means that most US and European banks are in danger of not having enough of the reserve cash required by law to back up the loans – many of them dodgy property loans.

The result has been the biggest wave of nationalisations in the Western world since the aftermath of WW2. However we are not nationalising railways, mines or manufacturers but banks.

Nationalisation = Socialism!

Some blowhards in government and media have labelled this outbreak of nationalisations as a return to socialism. Nothing could be further from the truth. Here the only thing that’s being socialised is the risk and the losses while the profits remain privatised. Socialism is about redistribution from the parasites to the producers, not the other way around.

Some commentators on the Paulson Plan’s $700 billion bail-out have noted that the figure almost exactly matches the amount the US has spent on its wars in Iraq and Afghanistan, but only in passing, as a coincidence. In fact, there is an indirect connection here. After the burst of the tech bubble and 9/11, the Fed Secretary Alan Greenspan, lowered the dollar interest rate right down below 2% to prevent a crash. He then kept interest rates very low, right through to 2004, dropping down to 1% just after the US invasion of Iraq. It was this ultra-low rate, in part motivated by the need to provide cheap money to fund the Iraq adventure, which contributed to the growth of the property bubble.

In the American neo-cons’ original plan, the Iraq adventure was supposed to pay for itself with seized Iraqi oil. Now it looks like the US taxpayers will have to pick up the bill. But they will not be the only ones to pay. As the collapse of this debt pyramid drags us into a global recession, we will all end up paying.

Normal service will not be resumed

“Raw capitalism is a dead end”, US Treasury Secretary Hank Paulson now says. The political and business establishment are suddenly agreed that government intervention and regulation are not only a good thing, but a vital necessity. Well they’ve sure changed their tune. These are the very same people who have been bashing us over the head since the 1970s with the neoliberal dogmas that regulation is bad, that markets can look after themselves far better without government interference. The whole neoliberal catechism is now in shreds. So we will not be going back to the way things were before this crisis.

Nor will we be going back to the way things were before neo-liberalism. Globalisation has meant the shift of industrial power to the East. China is now the workshop of the world. With its failure to seize control of the world’s oil reserves, US power to continue to dictate the terms of trade and the global economy is waning.

What’s next?

Capitalism is no stranger to crises. In many ways crises are seen as an opportunity to overcome obstacles to profitability that tradition or popular resistance have established over time. The capitalist solution to the crises they create is always to try and make the workers pay. In concrete terms this means an all-out assault on wages through the rotten partnership process and further assaults on public services like health, education and public transport. Our response must be to fight back and not let them saddle us with the bill for their screw-ups.

--

This article is from Workers Solidarity 106, this is its first online publication

author by dunk - many preparing for post oil age... communities in transitionpublication date Fri Nov 28, 2008 17:37author email fuspey at yahoo dot co dot ukauthor address author phone Report this post to the editors

cause of this financial crisis = capitalisms unsustainable reliance on cheap fuel at start of "oil age". capitalism was able to exploit oil and its associated attributes, modern world as we now know it, as long as it could. those days are over, thankfully!!

what comes next, who knows, it is going to be tough over next while, already many in ireland have lost jobs. but maybe now the critical dialogue might start to kick in.

As eco city guru said, now is the time to build eco cities

related post: From OIL AGE financial crisis, to sustainable communities + COP 15
http://itsafunnyoldworld.wordpress.com/2008/10/30/oilage/

id also direct you to Ugo Bardis views on this, in a spanish / italian mix:
http://www.youtube.com/watch?v=4kOUvYV8dQw (poor sound quality)

ASPO Italia 1 - Ugo Bardi
http://www.youtube.com/watch?v=rmTULzFq--Y

ASPO International | The Association for the Study of Peak Oil and Gas
http://www.peakoil.net/

Oil age in terms of Irish Stout. 1900, 2000, 2100 - Colin Cambell
Oil age in terms of Irish Stout. 1900, 2000, 2100 - Colin Cambell

Caption: Embedded video Youtube Video


author by Terencepublication date Sat Nov 29, 2008 19:40author address author phone Report this post to the editors

Whilst I agree largely with the analysis given above and the ones given by Dunk relating to the era of cheap oil are also valid, I think the best way to look at what is happening is to do the analysis at multiple levels and timescales because each provides more of the picture.

So for example, the cheap oil analysis can be viewed at over the last year or two where the surge to $147 a barrel for oil, sucked the remaining discretionary income from people as costs of everything went up. Looking at it over the multi decade level we can see it was responsible for the build out of suburbia and the absolute dependence of the physical structure of the economy on cheap energy.

On the currency level, we can see that the break of the dollar from the gold standard in the early 1970s by Nixon, because the US was going broke because of the Vietnam war, it is very apparent that the dollar has hyperinflated since then and especially so in the last 7 or 8 years.

Yet another analysis, a traditional Marxist one says that capitalists switched to finance and speculation to maintain profit levels over the last decade or too and yet the financial sector didn't seem to produce anything other than large debits to be paid back sometime in the future. This could be seen as a way of trying to reap tomorrows profits today.

At the same time, you can also take the view that the workers who had won so many rights and increased living standards (in the West at least) but were steadily losing them to globalisation, sought to maintain the standards of living despite job insecurity and falling wages in real terms and the banks were only too happy to lend out the money to maintain their own profits. As most people know lots of people borrowed against the "increased" value of their houses.

There are still other ways of slicing through what is happening in terms of looking at it from short term, medium and longer term historical perspectives.

It could be argued that if the financial deregulation didn't happen in 1998 (during the Clinton years under the influence of the people who have now been picked by Obama) that maybe the longer term factors mentioned above would have lead to the same crisis more or less, but a few years or even a decade later. However regardless, it is still worth learning and investigating what is happening at these different levels rather than solely concentrating on things from just one particular time period or from one set of factors.

author by Ethenpublication date Wed Mar 18, 2009 08:19author address author phone Report this post to the editors

Because of the economic crisis that we are facing today lots of people are facing bankruptcies. Bank of America just can’t stay out of the headlines. Whether it’s Bank of America getting a bailout, getting slapped in a class action lawsuit, or getting into a tiff with Merrill Lynch executives over lying to them about the company they just bought, they get into the news. Oddly enough, just like the absorbed asset Merrill, they are being stung with requests to disclose their bonuses. It appears that they used the quick loans they got from the taxpayers (which they aren’t required to pay back) to pad their executives’ bank accounts. Mario Cuomo, attorney general of New York, and U.S. Rep Barney Frank aren’t happy with Bank of America for enriching themselves after they nearly went broke. Read more on this site: http://personalmoneystore.com/moneyblog/2009/03/10/offi...uses/.

 
© 2001-2020 Independent Media Centre Ireland. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by Independent Media Centre Ireland. Disclaimer | Privacy