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Better Believe It Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:10 PM
Original message
"Neoliberal ideologues believe that a deep recession and even depression will stabilize economy"
Greece: Same Tragedy, Different Scripts
By Walden Bello
July 14, 2010
Walden Bello is a member of the House of Representatives of the Philippines.

Governments, from the United States to China and Greece, had resorted to massive stimulus programs to keep the real economy from collapsing during the first phase of the financial crisis. By promoting a narrative that moves the spotlight from lack of financial regulation to this massive government spending as the key problem of the global economy, the banks seek to forestall the imposition of a tough regulatory regime.

But this is playing with fire. Nobel Prize laureate Paul Krugman and others have warned that if this narrative is successful, the lack of new stimulus programs and tough banking regulations will result in a double-dip recession, if not a full-blown depression. Unfortunately, as the recent G-20 meeting in Toronto suggests, governments in Europe and the United States are caving in to the short-sighted agenda of the banks, who have the backing of unreconstructed neoliberal ideologues that continue to see the activist, interventionist state as the fundamental problem. These ideologues believe that a deep recession and even a depression is the natural process by which an economy stabilizes itself, and that Keynesian spending to avert a collapse will only delay the inevitable.

Faced with the programs savage consequences, an increasing number of Greeks are talking about adopting a strategy of threatening default or a radical unilateral reduction of debt. Such an approach could be coordinated, says Tsipras, with Europes other debt-burdened countries, like Portugal and Spain. Here Argentina may provide a model: it gave its creditors a memorable haircut in 2003 by paying only 25 cents for every dollar it owed. Not only did Argentina get away with it, but the resources that would otherwise have left the country as debt service was channeled into the domestic economy, triggering an average annual economic growth rate of 10 percent between 2003 and 2008.

The Argentine Solution is certainly fraught with risk. But the consequences of surrender are painfully clear, if we examine the records of countries that submitted to IMF adjustment. Forking over 25 to 30 percent of the government budget yearly to foreign creditors, the Philippines in the mid-1980s entered a decade of stagnation from which it has never recovered and which condemned it to a permanent poverty rate of over 30 percent. Squeezed by draconian adjustment measures, Mexico was sucked into two decades of continuing economic crisis, with consequences such as the pervasive narcotics traffic that has brought it to the brink of being a failed state. The current state of virtual class war in Thailand can be traced partly to the political fallout of the economic sufferings of the IMF austerity program imposed on that country a decade ago.

Read the full article at:

http://www.fpif.org/articles/greece_same_tragedy_differ...


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BrklynLiberal Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:13 PM
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1. Who are examples of "neo-liberals"?
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alfredo Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:15 PM
Response to Reply #1
2. Wolfowitz Jeb Bush, Cheney, kristol, Rumsfeld. Neocon is the same thing.
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BrklynLiberal Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:19 PM
Response to Reply #2
7. Thanks..So it really has nothing to do with actual LIBERALS..
Edited on Thu Jul-22-10 02:20 PM by BrklynLiberal
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alfredo Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 03:22 PM
Response to Reply #7
13. Right. The names are interchangeable. Read about Irving
Kristol, the father of William Kristol. Remember the Commies that tried to recruit the anti war crowd. They never got any attention on the left. We were not that into Trotsky or Mao or any of that authoritarian crap. Well, they left the left behind and migrated to the right. Over there they found enough authoritarians to build a movement.

Irving Kristol, father of the neo cons, was a Trotskyite.

Also read up on Leo Strauss and how he influenced the neocons. Read "Conservatives without Conscience" and "The Shock Doctrine." Read "Imperial Life in The Emerald City" to see how their philosophy operated in Iraq.
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BrklynLiberal Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 03:24 PM
Response to Reply #13
14. Thank you for all the great references to check out.
"Conservatives without Conscience" is by John Dean..right?
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alfredo Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 06:53 PM
Response to Reply #14
17. Yes.
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Better Believe It Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:16 PM
Response to Reply #1
3. Who is in power in Greece and Spain?
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gratuitous Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:17 PM
Response to Reply #1
4. It's a line of economic policy
I think it follows the teachings of Milton Friedman out of Chicago. This is one of those designations that confuse the public, almost deliberately, into thinking that these economic policies that punish the poor to the benefit of the wealthy are somehow connected to "liberal" political philosophy.
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Guy Whitey Corngood Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:17 PM
Response to Reply #1
6. Thatcher and Reagan. These are examples of the dead and undead but
Edited on Thu Jul-22-10 02:20 PM by Guy Whitey Corngood
living examples would include Thomas Friedman, Joe Lieberman, Alvaro Uribe, etc.

http://en.wikipedia.org/wiki/Neoliberalism

Global spread
Chronic economic crisis throughout the 1980s, and the collapse of the Communist bloc at the end of the 1980s, helped foster political opposition to state interventionism in favor of free market reform policies. From the 1980s onward, a number of communist countries initiated various neoliberal market reforms, such as the Socialist Federal Republic of Yugoslavia under the direction of Ante Markovic (until the country's collapse in the early 1990s), and the People's Republic of China under the direction of Deng Xiaoping.

Changes occurred from the 1970s to the 1980s. Started off with most of the democratic world governments focused primarily on the primacy of economic individual rights, rules of law and roles of the governments in moderating relative free trade. It was almost considered national self determination at the time.

Stances of organized labour shifted when governments of Ronald Reagan and Margaret Thatcher took strong stances to break down trade barriers entirely to reduce government power; thus allowing the market to be more important. Therefore industries will increasingly shift globally with integrated knowledge boosting the economy.

Socially, neoliberalism is marked by the return of class; rules and the blurring of social and market values<18>
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BrklynLiberal Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:19 PM
Response to Reply #1
8. Thank you all for your insights. I really was at a loss.
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Starry Messenger Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:20 PM
Response to Reply #1
9. Pinochet, Milton Friedman
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LWolf Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:22 PM
Response to Reply #1
10. The DLC.
"New" Democrats. With which Barack Obama has aligned himself:

http://www.politico.com/news/stories/0309/19862.html
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bvar22 Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 03:37 PM
Response to Reply #1
15. Examples of "Neo-Liberals"?
Anyone who believes there is a Giant Invisible Hand that magically reaches down from a holy throne and "corrects" markets when they are bad.
Its not really "Economics", but more of a Theology masquerading as Economics.
NeoLiberalism requires one to accept on blind faith the existence of an invisible deity (Invisible Hand) despite 30 years of PROOF to the contrary.

You will hear them say things like "Free Trade is good for the American Working Class!"

MOST of the Democratic Party Leadership ARE "NeoLiberals," including President Obama and former President Bill Clinton.

Bulletin:
There is no such thing as "Free Trade".
There is no such thing as a "Free Market".
There is NO Giant Invisible Hand.
The RICH made that shit up, and used smooth talking politicians to sell it to a gullible America.

If you Work for a Living do NOT trust ANY politician, Democrat or Republican, who espouses a belief in the "Invisible Hand", "Free Markets", or "Free Trade".
That politician is NOT your friend!

I prefer to call them Nero-Liberals,
because they are truly fiddling while the American Working Class dies a slow painful death.
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Hannah Bell Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:17 PM
Response to Original message
5. & "deep recession" = draining the pockets of the majority to consolidate wealth at the top.
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leftstreet Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:23 PM
Response to Original message
11. "Stabilize economy" also known as "More Serfs!" n/t
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sinkingfeeling Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 02:48 PM
Response to Original message
12. They also believe the USA should own the Middle East and taking it would be easy.
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Edweird Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 03:59 PM
Response to Original message
16. I suppose 'rock bottom' is a type of 'stability' - just not a good one.
It looks like we are going to find out if they are right.
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alfredo Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 07:02 PM
Response to Original message
18. Shock doctrine.
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McCamy Taylor Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Jul-22-10 09:48 PM
Response to Original message
19. OK, I'll bite. WTF is a Neoliberal? I like my Liberals pure and unadulterated.
So, why has someone tried to "improve" upon them? What parts did they cut away? What did they add?
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JoeyT Donating Member (1000+ posts) Send PM | Profile | Ignore Fri Jul-23-10 09:57 AM
Response to Reply #19
20. They're the exact opposite of regular liberals.
Authoritarians that believe what's good for business is good for people.

Definition of neoliberalism: Neoliberalism is a market-driven approach to economic and social policy based on neoclassical theories of economics that maximize the role of the private business sector in determining the political and economic priorities of the state.

Definition of fascism: Fascists seek to organize a nation according to corporatist perspectives, values, and systems, including the political system and the economy.

Pretty hard to tell the two apart, but if I'd just said "They're fascists or proto-fascists" someone would probably have griped. ;)
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