The people at http://visual.ly/ prepared a very complete graphic with information regarding the state of poverty in the United States in 2010. Just two years after one of the worst financial depressions the country had seen, the numbers of how 46.2 million people lived in poverty are impressing. The graphic includes information regarding race and ethnicity, family, gender, State by State and Past and Present figures.
Today I was impressed to watch Obama’s Weekly Address of December 03, 2011 in which he literally called for Americans to unite against the Republicans. He said that Republicans were not only opposing the American Jobs Act but that they were actually opposing to the reduction of taxes for middle class families by about $1,000.00. He was giving the speech of “we’ve got to cut taxes” and more so, that he had established a supposed computerized calculator to tell Americans how much money they were going to lose from their pockets if they don’t Stop Republicans. Here is the video,
Now, President Obama was lying once again and the reason lies behind the fact that he is calling for $1.5 trillion in new tax revenue. As professor Lew Rockwell from the Ludwig von Mises Institute noted, the proposed cuts are not real cuts, but cuts in the rate of increase, says Rockwell. He pointed out that the tax hikes are aimed at young entrepreneurs and business people starting out, as the oligarchs don’t like new people moving up in society.
“Taxes are wealth destruction. So anybody that proposes more taxes seeks to make us poorer as a group. However, the elites will make a lot more money out of this.”
More so, Rockwell believes that Obama, funded by the biggest banks, wants to help the ruling class and stick it to the productive class. He argues that the elite bankers, military industrial complex, and big pharma are getting far too rich and must be cut back. Rockwell predicts global inflation will result from the current depression.
The foreign policy of the richest countries has always depended in controlling the world’s monetary systems. As a continuation of the postcolonial systems, they continue holding the power to grant credits to poorer countries, to rescue their economies in periods of crisis and in pushing for an increase in world “reserves” and international “liquidity.” The end result of this policies resulted in creating world inflation and enriching those central banks that controlled the dice of this international game (just as it had been done in the previous colonial period).
Colonialism may seem to many an ‘old history’ that was overcome with the modernization of the world and the decolonization processes after World War II. Nonetheless, in the following postcolonial period many already institutionalized strategies continued working and are still present today. The IMF, for example, was one of the institutions born as a result of the decolonization process. Its results (far distant from their founding vision) were to keep the postcolonial countries in monetary and economic dependency.
For long the world’s centralized banking and monetary authorities, headed primarily by the International Monetary Fund, collaborated to initiate a period of surveillance, aid, and guarantees for the world’s financial markets as Philipp Bagus and David Howden explained in the post “The IMF and Moral Hazard“. However, the long-term results of theses policies fostered the dependency of postcolonial economies and, as such, empowered the populist leaderships in the former colonies that pursued expansive social programs that couldn’t be supported without their foreign aid and long-term indebtment.
Video: The Plan To Collapse Iran’s Central Bank
Today, I saw a video titled “The Plan To Collapse Iran’s Central Bank” in which analysts in the U.S.A. are evaluating the possibilities of collapsing Iran’s economy and disenabling them to continue researching their nuclear programs. Strategies as these may seem as “bogus” to many; however, the long history of international monetary intervention of the economies in postcolonial countries is long and influential (see: Pastor, Manuel (1989). Latin America, the Debt Crisis, and the International Monetary Fund. Latin American Perspectives). The results of any of these strategies always end up creating inflation and as Henry Hazlitt mentioned in his essay “End the IMF” in the year 1963 the only solution for and end to inflation (an as such for peace and economic recovery) is to eliminate the IMF and the interventionist international monetary system that has proved, in practice, a gigantic machine for world inflation.
The PP’s (The Partido Popular in Spain and the Partido Patriotain Guatemala) implemented a ochlocratic discourse with which they won the support of the majorities. In Spain, the Partido Popular discourse appealed to the masses by claiming that the Socialist Party (PSOE) had failed to be responsible in managing the economic crisis and that the solution was a paternalistic leader like Mariano Rajoy who was to bring order. In Spain, the current economic and social crisis raised the unemployment rate from 8.1% in 2006 to a historical level of 20% by 2010 an 21.5% by September, 2011. More so, the increasing financial crisis in the region continued to debilitate the government of José Luis Rodríguez Zapatero (PSOE) whose premiership policies of raising taxes and the lack of a coherent economic plan were ineffective to tackle unemployment and reducing the government deficits from two digit numbers.
In Guatemala, the same ochlocratic discourse won the support of the masses by criticizing the Party Unión de Esperanza Nacional (UNE) and its irresponsibility to stop the organized crime elites that control most of the government’s structures (corruption with money from organized crime has captured the local, judicial, legislative and executive powers). Their campaign also identified in the figure of Otto Perez Molina (known as Mano Dura ‘hard fist’) the leader that was going to stop the advance of corruption and organized crime.
Independently of the achievements that either of these political programs will have in their countries; it is evident that the paternalist and populist discourse is again an effective tool to manipulate the masses in moments of economic and social crisis. Unfortunately, these discourses implemented by the “Conservative/Right” movements in their respective contexts have historically failed to solve the problems they aimed to fix. The long-term effects of these discourses have led to an increased disenchantment with the economic elites (usually linked to right movements) and to the reelection of leftist movements after the end of the “conservative/rightist” terms.
The problem with these discourses is linked to one single philosophical concept. That is the concept of Collectivism that has caused for several centuries so much poverty, hunger and suffering around the globe,
“The political expression of altruism is collectivism or statism, which holds that man’s life and work belong to the state—to society, to the group, the gang, the race, the nation—and that the state may dispose of him in any way it pleases for the sake of whatever it deems to be its own tribal, collective good.” Ayn Rand
Let us hope that Spain and Guatemala will find a right philosophy sooner than later.
- New center-right Spain leader: Master of ambiguity (sfgate.com)
- Spain’s likely new leader: A master of ambiguity (seattletimes.nwsource.com)
- Spain fears for turning back clock on liberal reforms (telegraph.co.uk)
Lawrence H. White is professor of economics at George Mason University and the F. A. Hayek Professor of Economic History in the department of economics at University of Missouri — St. Louis. His teaching and research areas include economic history, monetary theory, money and banking, and history of economic thought. White holds a PhD and a MA in economics from University of California at Los Angeles; he also received his AB in the same area from Harvard University. He is visiting professor at Universidad Francisco Marroquín.
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