GNC Guest Post by
"It is well enough that the people of the nation do not understand our banking and monetary system for, if they did, I believe there would be a revolution before tomorrow morning." -Henry Ford
This quote, attributed to Ford by Charles Binderup, reveals the most fundamental fact of life in the modern world. That it is governed by an economic system that is in no way fair to all parties involved. In fact, it is actually exploiting the majority of the population for the benefit of the few.
That, of course, has been the state of human affairs for most of our known history. However, it was thought that the abolition of monarchy and oligarchy in most modern states of the world, and the gradual adoption of democracy during the previous two centuries, would result in the diminishing of social and financial inequalities.
The struggle for human rights during the 20th century, particularly in its second half, made great progress on every level. Working conditions improved, gender and race discrimination was considerably reduced, freedom of expression and speech was solidified and the future seemed brighter. With the fall of the Iron Curtain, everyone in the developed world believed that we were heading towards a new, more enlightened age of peace and growth.
As we now know, that was very far from the truth. The truth is that while the economy has been globalized to an unprecedented extent, a number of political, legal, national, cultural and religious boundaries and differences have made a comparable progress impossible on an administrative level. Take the EU for example. The monetary union was achieved before any kind of meaningful consensus could be reached on how the European Union could ever become a single entity politically, socially and, to an extent, culturally.
And since, as we all know, money makes the world go round, there are people and corporations now with the means of small countries who can move freely on a financial level with very little control. Think of it this way: if the people play the role of a King, then banks, corporations and the rich are the barons. And these barons can now act as they please without really being accountable to the Crown. Because the King depends on them to keep his treasury running and because he has no effective way to control them. If a King has no real power, then we are no longer talking about a monarchy. And if the "King" is actually the people and the people have no real power, then we are no longer talking about a democracy.
The dawn of the 21st century brought with it the promise of growth, equal opportunities for all, and a wealth of goods and services, all courtesy of the "free market". Unfortunately, these hopes were quickly dashed by the spectre of a financial crisis with no apparent end. In fact there is no crisis. Or rather, there would be no crisis if the global financial system was equipped with the proper safeguards against fraud, misuse and exploitation. Or, quite simply, if it was fair and sustainable. But that would entail more governmental control and that term alone is enough to send any economic liberalist screaming.
Because the "free market can regulate itself". Only that it can't. It is like thinking that you can put two death row prisoners in a cage to fight for their lives and expect them to play fair. They won't. They will use any trick in their disposal to beat their opposition, no matter the cost. Likewise, a corporation will do anything it can get away with in order to increase its advantage over the competition. If its customers or employees are hurt in the process, it's fine as long as it is never proven or detected. Substandard equipment, processes and materials, abominable working conditions and practices, legal loopholes and tricks, literally anything will be employed in the fight. Not all of them do it, but when most "players" do, then their competitive advantage either drives the rest out of business or into the same game.
Banks are no exception to this rule. Once considered one of the main structural pillars of any economy, they now operate solely and openly for their own profit, with any thought of promoting sustainable growth taking a back seat or getting kicked out of the car altogether. If a prosperous country like Iceland can be effectively ruined financially by its own banks, then one easily understands how this could happen to any country in the world. All this happened with the government and the central bank of Iceland turning a blind eye to the incredibly irresponsible dealings of a handful of people. Nevertheless, the first order of the day was not to arrest the persons responsible, but to hand the bill to the people of Iceland, as if they were somehow accountable for this mess.
The exact same thing is happening in most countries of the developed world right now. The people are asked to take the brunt of the cost for gross mismanagement on the part of bankers and corrupt politicians, even from other countries, all in the name of avoiding the deepening of a crisis which, by all accounts, is a bottomless pit. The crisis will never end because we are trying to treat the symptoms, while the root causes remain unaddressed.
The majority of people will see their incomes steadily decreasing, there will be steadily fewer and fewer jobs; work rights, which have been paid for in blood, will vanish. This has been happening for two and a half years in Greece and in the poorer countries of Europe. Greece is on the verge of total collapse, socially and financially, the neo-Nazi party is on a meteoric rise and the troika is still demanding for more cuts and "reforms" which will be nothing short of disastrous.
But it will not end with Greece. This system which kicks people out of their homes, jobs and deprives them of a future, which sends young people abroad as immigrants and which has replaced constitutional rights with violently enforced austerity measures will spread. Once the people of Greece and the other "PIGS" countries have been forced to work for wages comparable to those of China or starve, where do you think that most major corporations in Europe will move their manufacturing to? And what will happen to their own workforce at home?
Fascism now wears a respectable face, wears a suit and carries a tablet. You may call it "austerity", "reform", "free market", "economic rationalization" or however else you wish. I call it Finanscism.