Saturday, December 14, 2013
Thursday, November 28, 2013
Iceland - Hot Money and Cross Border Finance
Treacherous future still ahead? A look into why the Icelandic government imposed controls over movement of international funds across its borders & its current negotiations to lift those capital controls
Wednesday, November 27, 2013
US Corporations Enlist Ex Intelligence Agents to spy on Non-profits
A new report details how corporations are increasingly spying on nonprofit groups they regard as potential threats.
The corporate watchdog organization Essential Information found a diverse groups of nonprofits have been targeted with espionage, including environmental, antiwar, public interest, consumer safety, pesticide reform, gun control, social justice, animal rights and arms control groups.
The corporations carrying out the spying include the U.S. Chamber of Commerce, Wal-Mart, Monsanto, Bank of America, Dow Chemical, Kraft, Coca-Cola, Chevron, Burger King, McDonald's, Shell, BP, and others. According to the report, these corporations employ former CIA, National Security Agency and FBI agents to engage in private surveillance work, which is often illegal in nature but rarely -- if ever -- prosecuted.
Gary Ruskin, author of the report, "Spooky Business: Corporate Espionage Against Nonprofit Organizations," and director of the Center for Corporate Policy, a project of Essential Information.
Friday, November 22, 2013
Poor Countries and Civil Society Walk Out of COP 19 Over Inaction over Climage Change
Patrick Bond: Developing countries and green groups must evaluate if walkouts are the best way to get rich countries to address climate change
Thursday, November 14, 2013
TPP Exposed: WikiLeaks Publishes Secret Trade Text to Rewrite Copyright Laws, Limit Internet Freedom
Political Economy Research says get past the CATO crap in the first few minutes and listen to Lori Wallach and think about what she is saying.
If you do not know anything about TPP watch the video at the bottom of this text first and the top video last.
WikiLeaks has published the secret text to part of the biggest U.S. trade deal in history, the Trans-Pacific Partnership (TPP).
For the past several years, the United States and 12 Pacific Rim nations have been negotiating behind closed doors on the sweeping agreement.
A 95-page draft of a TPP chapter released by WikiLeaks on Wednesday details agreements relating to patents, copyright, trademarks and industrial design -- showing their wide-reaching implications for internet services, civil liberties, publishing rights,and medicine accessibility.
Critics say the deal could rewrite U.S. laws on intellectual property rights, product safety and environmental regulations, while backers say it will help create jobs and boost the economy.
President Obama and U.S. trade representative Michael Froman reportedly wish to finalize the TPP by the end of the year and are pushing Congress to expedite legislation that grants the president something called "fast-track authority."
However, this week some 151 House Democrats and 23 Republicans wrote letters to the administration saying they are unwilling to give the president free reign to "diplomatically legislate."
We host a debate on the TPP between Bill Watson, a trade policy analyst at the Cato Institute, and Lori Wallach, director of Public Citizen's Global Trade Watch.
For a long time now there has been concern about the Trans Pacific Partnership Agreement and what it might mean for intellectual property laws and online rights but little is known about the negotiations for the treaty because talks are being held in secret.
However, WikiLeaks managed to obtain and release the chapter of the agreement concerning IP and people who've been following the talks are more worried than ever.
We spoke to journalist, writer and author of Rebel Code, Glyn Moody about just what the TPP is and the potential consequences of it being signed
Monday, November 11, 2013
EU- US TAFTA Trade Deal - Corporations above Nations
Political Economy Research says TAFTA is for the Atlantic has TPP is for the Pacific and both trade agreements if they can be called that put corporations above nations which is especially why the US is so eager to impose TPP on Pacific Rim and TAFTA on Europe.
TAFTA just like TPP gets very little media coverage because only knowing about it will create opposition to it - basically you have to be daft to support TAFTA and has the Pacific Rim is discovering mad to support TPP.
They hope to keep us ignorant while they do deals behind closed doors.
See Also:
http://democracyandclassstruggle.blogspot.co.uk/2013/03/everyone-but-china-agreement-prevents.html
Also watch Max Keiser for how angry we should be with TAFTA and TPP
Tuesday, October 29, 2013
The Green Economy and China's Economic Development - No to failed Green Market Economy
Dr Ying Kong is the founding Dean at the Tsinghua (Qianhai) International Business School is a Tsinghua Professor promoting the bankrupt idea of Carbon Trading in China and Green Market Economy - Tsinghua University is the ideological centre of free market fundamentalism in China has we have recently noted.
See videos below for shortcomings of carbon trading another idea from Goldman Sachs so popular at Tsinghua University and from Patrick Bond on failure of Green Market Economy.
For further reading visit here:
http://democracyandclassstruggle.blogspot.co.uk/2009/12/cap-and-trade-critical-look.html
http://democracyandclassstruggle.blogspot.co.uk/2013/10/should-china-liberalize-its-economy.html
http://democracyandclasstruggle.blogspot.co.uk/2012/06/green-market-economy-failure-rio20.html
Friday, October 25, 2013
Manufacturing Imperialism :The Political Economy of Special Economic Zones by Rona Wilson
Political Economy Research has recently been sent this work of Rona Wilson and we are pleased to publish it has it address's some fundamental questions about displacement and development in India.
The article is longer than what we normally publish but the effort in seriously studying this document will be repaid with deepened knowledge of Indian reality.
The country that is more developed industrially only shows, to the less developed, the image of its own future
--Marx, Capital, Vol I
An epitome of beauty, serenity and colonial charm…
--An advertisement for The Carlton, a luxury hotel created by the Rahejas in Kodaikanal, Tamil Nadu
Introduction
Land, development and displacement has once again become the central point of debate in India. Curiously the debate is on industrial development ostensibly, under capitalism. Suddenly it has dawned upon the learned Prime Minister Manmohan Singh and his policy experts that land and agriculture cannot be the main basis for the economy of a country like India that is marching ahead in the 21st century. The often erudite, soft spoken PM has even gone to the extent of calling all those, who oppose the present road map of prosperity and growth laid out by his government, anti-development and hence anti-national. The Prime Minister has equated the present policy prescription for growth tempered by the diktats of the World Bank and IMF with the ‘national interest’. Dr. Manmohan Singh is not alone in his concern about the future of the so-called ‘second generation reforms’, otherwise known as Liberalisation, Privatisation and Globalisation (LPG).
He is joined by the likes of Dr. Amartya Sen who is always ready to ‘grade’ the ‘performance’ of the Indian economy. In one of his interviews to The Telegraph while trying hard to pull the CPM-led West Bengal government out of the ignominy of Nandigram and Singur the Nobel Laureate has made it loud and clear that whatever is happening in the form of Special Economic Zones throughout the sub-continent is development through industrialisation that India badly needs. And make no mistake. This development package will inevitably have to exploit land that was / is fertile or otherwise. Gone are the days when agriculture alone could provide to the developmental needs of the Indian economy which as per Sen the economist is poised for a growth of more than 9 percent, mainly propelled through foreign direct investments. At best, it is nothing but Sen and the art of consensus building. Incidentally, when the people of Singur was protesting against land being taken from them against their will, Telegraph had carried photographs of CPM cadre moving in hordes on motorcycles in Singur with red flag and the life size portrait of Ratan Tata trying to ‘educate’ the people about the virtues of the TATAs as the harbinger of industrialization in post-47 India. Perhaps both, the Nobel laureate and the lumpen brigade of the CPM, were conveying the same, albeit, in different ways.
It’s official now. Agriculture cannot be the main provider of employment for the vast sections of the masses abounding rural India. In fact, the first official warning came in the form of an innocuous survey of the NSSO—about which the government had made a song and dance, not to mention the media that had gone overboard—proclaiming that about 40 percent or more of the peasantry in India would want to rid their lives of agriculture.
Yet in the maze of this publicity blitzkrieg by the proponents of LPG, what is carefully ignored is the question of development itself. The question as usual is deliberately posed in a manner where the pertinent aspects on the ramifications of a development model—that is totally reliant on foreign capital / dependent on imperialism—for the vast sections of the masses of this country hardly gets any mention.
What is argued is that displacement is inevitable in development. The rest of the arguments are just a logical corollary of this initial refrain. Since the peasantry cannot provide labour opportunities through agriculture anymore for the bulk of the masses as required by the circumstances coupled with the diminishing returns for the farmers with a high input cost and low market price / support price for the output, there is no more incentive for them to continue in the same productive activity.
Amidst all this effort of consensus building are the shocking and gripping accounts of violence and repression from the killing fields of Kashipur, Kalinganagar, Nandigram, Raigada, Jagatsinghpur and Singur. When this is being written the CPI (M) has resorted to the worst carnage in Nandigram which even the die hard supporters of CPI (M) itself have shockingly compared it to the worst genocide that followed the post-Godhra riots in the state of Gujarat in 2002. The scope of this article does not permit to deal with the entire happenings in Nandigram. It may be dealt in a separate piece.
Is displacement due to development or the development of displacement an inevitable thing like ones own shadow, a necessary evil that has to be lived with when one thinks about development? Or is there a possibility of a development which is free of any form of displacement; any form of violence on the people? Is this phenomenon of displacement due to development a new feature in the trajectory that India followed post-47? These are vital questions we cannot shy away from if we are serious in fighting the four dreaded Ds—Displacement, Destruction, Destitution and Death, especially in a social reality like South Asia and that too at a time when private capital—foreign and domestic—is considered as the main vehicle of implementation of the policies of LPG.
Wednesday, October 23, 2013
Monday, October 21, 2013
Saturday, October 19, 2013
Dismissal of Xia Yeliang - the first step in a long journey back to Socialism
China has plenty of academic economists who, like Professor Yeliang, of Beijing University Economics Department believe in unfettered free markets and see's them as allied to "liberal democracy" and a western version of representative democracy for China.
You will not be surprised that Political Economy Research does not think much of these people or their ideas in fact we have been exposing them here:
Last year, Professor Xia issued a call on the Internet for Chinese intellectuals to gather in public spaces to discuss and promote capitalist political reform.
Before that, he mocked a government minister for having a degree from a technical school and not having his Hayekian searing intellect.
Political Economy Research may be the only people in the West to welcome his dismissal has bourgeois economists rally to his defence but we see this has a victory albeit a small victory in the ideological struggle over China's future - the struggle for Socialism.
Political Economy Research may be the only people in the West to welcome his dismissal has bourgeois economists rally to his defence but we see this has a victory albeit a small victory in the ideological struggle over China's future - the struggle for Socialism.
Wednesday, October 16, 2013
The Tea Party and the Suppression of the Left
Richard Wolff explains the history behind the Tea Party "The Republican-Tea Party alliance operates a weapon of mass deflection, protecting capitalism from criticism. Sadly, the Democrats neither expose nor attack the Republican project"
Visit : http://www.truth-out.org/opinion/item/19086-what-gop-tea-party-risks-with-block-of-new-new-deal?
Debt Ceiling Deadline Looming - Ranting and Raging in the USA
The de Americanisation of the World Financial System is already underway and is getting a boost from the ranting and raging in the USA.
We have the Alex Jones Info Wars ranting and raging that projects itself beyond left and right which calls Obama a Communist - which quickly exposes his right wing roots with its base of eclectic conservatism.
Then we have the ranting and raging of Cenk Uygur of the Young Turks of the liberal left (The Welfare/Warfare of Roosevelt).
To this we add the Dylan Ratigan, Ranting and Raging, a man that wants to appear to be an Alex Jones without the weird stuff another closet rightist who tries to appear leftist who opposes "corporate communism". The video above is from 2011 and his a classic rant, but his points are even more relevant with debt ceiling deadline tomorrow 17th October 2013
They are all competing to give expression to the deep disgust with the democracy for the few of Wall Street which is in your face and is becoming impossible to deny - however we are not of the view that this disgust and outrage will take a progressive direction in America has we can see in the contradictions of the current crisis ugliness emerging from liberal as well as conservative America.
Sunday, October 13, 2013
Friday, October 11, 2013
Should China Liberalize Its Economy? Frank Venerosa says No !
'
The speech of Frank A.J Veneroso is remarkable for a bourgeois and we at Political Economy Research agree with much of what he says and China should listen to his advice except we would go further and close down the free market evangelist Tsinghua University Economics Department and the derivatives and futures markets in China. Also the capitalist asset transfer system in China called the Stock Market should be closed.
We would reinstate the Chinese Central Planning Commission which was disbanded by Wu Jia when he set up Institute for the Reconstruction of the Chinese Economy.
Speaking of Hyman Minsky and excluding Karl Marx from this debate which is about the centrality of capital accumulation and its discontents and the internal contradictions of capital shows the class character of these hired prize fighters of the Chinese bourgeoisie and their lack of scientific political economy now that Chinese Universities have succumbed to the political virus of neo liberalism.
China has the opportunity to return to Socialism in the 21st century or descend into the barbarism of full free market capitalism rather than the state capitalist hybrid present system - listen to Frank Veneroso not the paid prostitutes of the free market in China like Tsinghua University professors who are not fit even to run pig farms after working for Goldman Sachs.
“crossing the river by touching the stones” was a lie when first propagated by Deng Xiaoping has he had a plan based on failed attempts of labour market reform during Mao Era.
China needs a plan now not blind market forces to steer it economy to safety - only socialism can save China.
Nickglais Editor of Political Economy Research
PS If you want to know how Goldman Sachs survived and flourished during the economic crisis it has little to do with their systems like Jian Wulin their Tsinghua apologist speaks but much more to do with Guanxi (connections) watch a recent video by Greg Palast here:
http://democracyandclassstruggle.blogspot.co.uk/2013/09/revealed-potential-fed-chair-summers-at.html
See Also :
http://www.youtube.com/watch?v=JY-7Sz058P4
Just saw the INET/Tsinghua Report on the Conference above and they reported that Venerosa said to cautious about further liberalisation - they obviously did not listen to his speech and have even reported it inaccurately has he said NO to further liberalisation.
This fundamental debate constitutes the classic challenge facing Beijing today and it is well reflected in this panel discussion between Andrew Sheng and Frank Veneroso from a recent conference in Shenzhen, China, titled, "The Good Life: The Challenge of Progress in China Today."
Which path will lead China to success in the 21st century? Watch the video to see what Sheng and Veneroso have to say!
Mr. Frank A. J. Veneroso is presently the lead partner of Veneroso Associates. Formerly he was a partner of Omega Advisors, where he was responsible for investment policy formulation. Prior to this, acting through his own firm, Mr. Veneroso has been an economic consultant and investment strategy advisor to governments, international agencies, financial institutions, and corporations around the world. He acted as an economic policy advisor to international agencies and governments in the areas of money and banking, financial instability and crisis, privatization, and the development and globalization of emerging securities markets. His clients have included the World Bank, the International Finance Corporation, and the Organization of American States. He has been an advisor to the governments of Bahrain, Brazil, Chile, Ecuador, Korea, Mexico, Portugal, Thailand, Venezuela, and the United Arab Emirates. Mr. Veneroso graduated cum laude from Harvard University and has authored several articles on subjects in international finance
See Also: http://kasamaproject.org/international/791-23nickglais-china-today-capitalist-or-socialist
http://democracyandclasstruggle.blogspot.co.uk/2013/04/the-historical-significance-of-mao.html
http://democracyandclassstruggle.blogspot.co.uk/2008/08/chinese-political-economy-in-order-to.html
http://democracyandclassstruggle.blogspot.co.uk/2008/08/legitimizing-market-socialism.html
The speech of Frank A.J Veneroso is remarkable for a bourgeois and we at Political Economy Research agree with much of what he says and China should listen to his advice except we would go further and close down the free market evangelist Tsinghua University Economics Department and the derivatives and futures markets in China. Also the capitalist asset transfer system in China called the Stock Market should be closed.
We would reinstate the Chinese Central Planning Commission which was disbanded by Wu Jia when he set up Institute for the Reconstruction of the Chinese Economy.
Speaking of Hyman Minsky and excluding Karl Marx from this debate which is about the centrality of capital accumulation and its discontents and the internal contradictions of capital shows the class character of these hired prize fighters of the Chinese bourgeoisie and their lack of scientific political economy now that Chinese Universities have succumbed to the political virus of neo liberalism.
China has the opportunity to return to Socialism in the 21st century or descend into the barbarism of full free market capitalism rather than the state capitalist hybrid present system - listen to Frank Veneroso not the paid prostitutes of the free market in China like Tsinghua University professors who are not fit even to run pig farms after working for Goldman Sachs.
“crossing the river by touching the stones” was a lie when first propagated by Deng Xiaoping has he had a plan based on failed attempts of labour market reform during Mao Era.
China needs a plan now not blind market forces to steer it economy to safety - only socialism can save China.
Nickglais Editor of Political Economy Research
PS If you want to know how Goldman Sachs survived and flourished during the economic crisis it has little to do with their systems like Jian Wulin their Tsinghua apologist speaks but much more to do with Guanxi (connections) watch a recent video by Greg Palast here:
http://democracyandclassstruggle.blogspot.co.uk/2013/09/revealed-potential-fed-chair-summers-at.html
See Also :
http://www.youtube.com/watch?v=JY-7Sz058P4
Just saw the INET/Tsinghua Report on the Conference above and they reported that Venerosa said to cautious about further liberalisation - they obviously did not listen to his speech and have even reported it inaccurately has he said NO to further liberalisation.
This fundamental debate constitutes the classic challenge facing Beijing today and it is well reflected in this panel discussion between Andrew Sheng and Frank Veneroso from a recent conference in Shenzhen, China, titled, "The Good Life: The Challenge of Progress in China Today."
Which path will lead China to success in the 21st century? Watch the video to see what Sheng and Veneroso have to say!
Mr. Frank A. J. Veneroso is presently the lead partner of Veneroso Associates. Formerly he was a partner of Omega Advisors, where he was responsible for investment policy formulation. Prior to this, acting through his own firm, Mr. Veneroso has been an economic consultant and investment strategy advisor to governments, international agencies, financial institutions, and corporations around the world. He acted as an economic policy advisor to international agencies and governments in the areas of money and banking, financial instability and crisis, privatization, and the development and globalization of emerging securities markets. His clients have included the World Bank, the International Finance Corporation, and the Organization of American States. He has been an advisor to the governments of Bahrain, Brazil, Chile, Ecuador, Korea, Mexico, Portugal, Thailand, Venezuela, and the United Arab Emirates. Mr. Veneroso graduated cum laude from Harvard University and has authored several articles on subjects in international finance
See Also: http://kasamaproject.org/international/791-23nickglais-china-today-capitalist-or-socialist
http://democracyandclasstruggle.blogspot.co.uk/2013/04/the-historical-significance-of-mao.html
http://democracyandclassstruggle.blogspot.co.uk/2008/08/chinese-political-economy-in-order-to.html
http://democracyandclassstruggle.blogspot.co.uk/2008/08/legitimizing-market-socialism.html
Monday, September 23, 2013
Monday, September 2, 2013
Revealed: Potential Fed Chair Summers At Heart of Global Economic Crisis
Greg Palast: Secret memo reveals Larry Summers involved in deal that helped setup the global economic crisis
Tuesday, August 13, 2013
Sunday, August 11, 2013
Sunday, June 30, 2013
Wednesday, June 26, 2013
Sunday, May 26, 2013
Wednesday, May 1, 2013
Academics, speak out against neoliberalism ! A conversation with anthropologist Gísli Pálsson about the meltdown in Iceland,
It was one of the worst economic crashes in history: A conversation with anthropologist Gísli Pálsson about the meltdown in Iceland, dubious entanglements between universities and business, racist and sexist neoliberal discourses, and the need for academic activism.

Protests at the Parliament in Reykjavik: When neoliberal policies resulted in a meltdown of the national economy, which at best instantly doubled daily expenses and levels of debt for cars and houses, Icelanders took to the streets. Photo: Private
October 2008. When anthropologist Gísli Pálsson returned to Iceland after some days abroad, the stewardess did not as usual warmly addresses passengers with “Welcome home!” over the plane’s loudspeakers. Instead, she said in a deep cynical tone “Welcome to the bank ruins!”.
In the next Overheating seminar on 30.4.2013, Gísli Pálsson will be speaking about one of the largest financial crashes in history - the meltdown in Iceland. He will present a book in the making about the meltdown: “Neoliberal Iceland: The Canary in the Global Coalmine”.
The professor from the University of Iceland (who also has been professor at the University of Oslo) is known for studies on a wide range of topics: the anthropology of Iceland, nature and environment, biomedicine and the new genetics, arctic exploration, property rights, and fisheries.
It started with the privatisation of the resources of the sea
Gísli Pálsson: "During the financial crisis, the academe massively failed." Photo: Private
In the 1980s he studied one of the first stages of a development that later would partly ignite the big crash - the privatisation of the resources of the sea: fish.
At that time, he published several papers on theconcentration of quotas in the hands of a few families:
– Icelandic fisheries became one of the first showcases for the supposed beauty of a neoliberal marked based fisheries program. As it had done around the world, neoliberalism concentrated wealth in a few elite hands. Within few years the public property of fish was privatized and allocated to the biggest boat owners, making them millionaires. Wealth from the national resource fish was first privatized and then moved into the realm of finance, until everything spiralled out of control, the anthropologist explains.
The book “Neoliberal Iceland” aims to provide thick descriptions about the implications of the meltdown for the Icelandic society, including local communities, urban poor, immigrants, artists, intellectuals, school children, fishermen and women, and politicians.
– There is a growing literature on the Icelandic meltdown and other meltdowns, but these works tend to be mainly economic or business studies. My co-organizer Paul Durrenberger and I felt the horizon needed to be broadend. So, last August we arranged a workshop, funded by the National Science Foundation in the US. The team consisted mainly of anthropologists, but there were others too, a philosopher, sociologist, educational scholar, linguist, historian - and a poet-novelist.
Defends "activist language"
– In the draft Introduction of the book you’re using a kind of activist language that is rather unusual for an academic book with their cautious “on the one side and on the other side” rhetoric. For example you write “Iceland was the first and the worst of what could and did happen across Europe in the coming years, yet neoliberalism still reigns across the globe. It’s up to us to notice before it is too late.”
– I do defend this. Sometimes we need to speak out. No one can doubt that what happened in Iceland was profoundly damaging families and companies. It was a massive blow that literally overnight left lots of people unemployed, and doubled daily expenses and levels of debt for cars and houses that people were unable to pay.
– So I think it’s important to try to keep a straight head and speak out rather than using the usual academic verbosity.
Fish is money: Wealth from the national resource fish was first privatized and then moved into the realm of finance, until everything spiralled out of control. Photo:marie-ll, flickr
One of the 20 articles in the book focuses on the “surreal politics of the so-called Best party”, he explains:
– The Best Party took everybody by surprise by winning the City Council elections of Reykjavik in 2010. The people behind the party were mainly artists. They made playfully fun of politics but with a serious undertone. They started a campaign like a carnival - crazy, surreal and fun. A parody on Iceland in the crisis. One of the authors of the book watched the scene closely and reflects on it.
Racist neoliberalism
Another article focuses on theViking rhetoric before the crisis, when Iceland experienced an unparalelled economic boom:
– Prominent business persons were trying to explain the boom before the crash in terms of the psychology of an Icelander as a descendent of the medieval Vikings who took immense risks, ventured into distant lands to pillage and profit, and then returned to Iceland as public heroes.
– A racialised neoliberal discourse?
– Yes, it was assumed that there was something essential and almost genetic in the successes of these Business Vikings. Embarrassingly, professional scholars at the main universities also engaged in intensive ideological work that highlighted the “uniqueness of the Business Vikings of Iceland”.
– At the University of Iceland they even designed specific research projects to explore, draw upon, and advance these so called “unique characteristics of the Business Vikings”. Critique was suppressed, and those who felt they had objections, gave up and became silent. Some of these projects were, by the way, financially supported by some of the banks and companies that were heavily implicated in the meltdown.
Universities as “vanguards of the neoliberal turn”
– The universities as “vanguards of the neoliberal turn”?
– Yes. In order to understand the crises one has to pay attention to the role of economics. The neoliberal economies were driven by Lady Thatcher and Ronald Reagan in the political domain, and by a series of economists in the academic domain.
– There is a famous metaphor by Deirdre McCloskey who is trained in Chicago. McCloskey characterized neoclassical economists as “a motorcycle gang among economists“. A very masculine notion, pointing out the failure of neoclassical economists to address the issue of solidarity, except within the patriarchal family and the corporation. This ”gang" was overheating the Icelandic economy mainly through the refashioning of fisheries in terms of private quotas, and deregulation.
Religious belief in the market
– And their belief in the market was somehow religious as novelist and poet Einar Már Guðmundsson points out, as I read in the introduction of your book? The “Invisible Hand” becomes the “Will of God”. Do you agree?
– Yes, I do. Furthermore, modern economics is packed with empty assumptions that do not hold. It’s these empty assumptions that have partly driven things out of control.
– When the fishing stocks were privatized in Iceland in 1984, one of the key assumptions behind the privatization was that quota allocations should be based on boat ownership. The assumption was that the people owning capital and boats were the real actors in the economy and society.
Privatisation: The public property of fish was concentrated in the hands of boat owners. Photo: Ingvar Sverrisson, flickr
– I said in my papers in 1980s that this was an empty assumption. There is nothing in economics that suggests that fishing history is only made by the people who own boats. Fishing history is driven by all kinds of agents. One has to recognize the contribution of the crew, skippers, communities, mechanics, boat constructors, and people working in fishing plants. To say fishing history is boat ownership is crazy, it’s a bad theory and unfounded. I think this is a good example of religious faith. You assume what you should be analysing.
– What has to change in academia?
– The university has the obligation to stay calm, to reflect and critique. In the Icelandic case and other recent meltdowns, the academe massively failed. Many economists in Iceland were paid for issuing reports that falsely claimed that everything was on track and under control. They celebrated the activities of the Business Vikings even a few months before the meltdown.
– Certain things can be done in terms of how you hire people, how you conduct your business, how you as an academic relate to the outer world, the extent to which you can simultaneously work for the university and for a bank, for example with ethical rules and guidelines about the relationship between the academe and the outer world.
The need for more holism
– You’re going to publish another book. Biosocial Becomings. Integrating Social and Biological Anthropology where you take a stand for more holism?

– The context for the book is a split in anthropology, although the book also has implications for other disciplines. It illuminates the problems of the nature - society divide, which is fairly general in the academe. In anthropology we have social and cultural anthropology on the one hand, and biological and physical anthropology on the other hand. That’s an old division that has been debated for decades.
– Tim Ingold, my co-editor, and I, felt that it was time to address the issue head on, and sort of say, “Ok let’s assume that we scrap the divisions within anthropology. What would this refashioning mean for our discipline?” We invited people to contribute to a panel at an anthropological meeting. We’ve edited the papers, and they will come out in this book in a couple of months.
– Then you just published a related paper about integrating the social sciences and humanities in global environmental change research?
– Yes. The paper was written by a team that I organized under the European Science Foundation.
– The goal was to alert people to the fact that massive overheating was going on on the planet, and that something needed to be done within a few years, otherwise it would be too late to slow down or reverse some of the key processes in global warming and pollution.
– Our goal was to lay out why the social sciences and the humanities are central to environmental discussions and research. Previously these disciplines have been considered marginal. Most of the funding in environmental studies has gone to ecology, biology, engineering and so forth.
"Refashion the disciplines"!
– If you could start from scratch, how would you re-organize university?
– Oh that’s a heavy question. To some extent we are stuck with disciplines, they have a momentum of their own. But we should try to refashion them. We need to open up a space for broadminded collaboration on issues like ecology, environment, finance and global change. Fortunately, there are lots of experiments going on in reorganizing, collaboration, interdisciplinarity, even transdisciplinarity is a popular theme.
– Some neglected topics that need attention?
– We need to broaden the notion of the ecosystem for instance. The ecosystem tends to be seen as a system of natural processes. But if these natural processes are thoroughly social, then we need to revise our notion of system, environment, nature,oikos and so forth. That means we have to take a much broader perspective than we traditionally have done. Such a holistic perspective is badly needed!
By Lorenz Khazaleh
Published Apr 25, 2013 03:06 PM - Last modified Apr 25, 2013 03:34 PM
Wednesday, April 24, 2013
Thursday, April 18, 2013
Monday, April 15, 2013
Friday, April 12, 2013
Thatcher Gave More Power to Finance
Michael Hudson: Thatcher deregulated banking and made London the center of speculation and financialization
Saturday, April 6, 2013
Financial Warfare: The Recolonization of Korea. Seoul Black Monday. IMF Intervention in Korea by Prof Michel Chossudovsky
This article first published in July 2000 identifies the process whereby South Korean capitalism was literally hijacked at the height of the 1997-98 Asian Crisis. The objective was also to destabilize and its major business conglomerates as well as take over its banking system. The IMF reforms triggered a string of bankruptcies and the downfall of industrial wages.
The IMF program applied to a advanced market economy was to undermine national sovereignty as well as shunt the process of reunification of North and South Korea. The longer term objective is to open up North Korea to Western corporate capital as well as transform the DPRK into a new cheap labor frontier of the global economy. That was the fate of Vietnam starting in the early 1990s upon the lifting of US economic sanctions.
The deadly sanctions regime imposed on Pyongyang over a period of more than half a century combined with the relentless threat to wage a nuclear attack against North Korea are intended to eventually impose the “Free Market” on the DPRK Korea under the guidance of Wall Street and the IMF.
An expanded and updated version of this text was subsequently included in the second edition of my book, The Globalization of Poverty and the New World Order, Global Research, Montreal, 2003.
Michel Chossudovsky,
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The Recolonization of Korea
Seoul Black Monday. IMF Intervention in Korea
by Michel Chossudovsky
June 10, 2000In the late days of November 1997 an IMF team of economists led by trouble-shooter Hubert Neiss was swiftly rushed to Seoul. Its mandate: to negotiate a Mexican-style bail-out with a view to rapidly restoring economic health and stability. An important precedent had been set: the IMF’s bitter economic medicine, routinely imposed on the Third World and Eastern Europe, was to be applied for the first time in an advanced industrial economy.
Washington had carefully set the stage in liaison with the US Embassy in Seoul. Barely a week before the arrival of the IMF mission, President Kim Young Sam had sacked his Finance Minister for having allegedly hindered negotiations with the IMF. A more acceptable individual was appointed on Washington’s instructions. Very convenient: the new negotiator and Finance Minister Mr. Lim Chang-yuel happened to be a former IMF and World Bank official. Also fired at short notice was presidential economic adviser Kim In-ho, for having spurned the IMF option and said Seoul would restore international credibility through its own efforts. (1)
Finance Minister Lim was accustomed to the Washington scene. No sooner had he been appointed, he was whisked off to Washington for negotiations with his former colleague IMF Deputy Managing Director Stanley Fischer.
Seoul Black Monday
The government’s dealings with the IMF had been a closely guarded State secret. On Friday 21st of November, the government officially announced that it would be seeking an IMF bailout. On the following business day, November 24th, Seoul Black Monday, the stock market crumbled to a ten year low over feared IMF austerity measures and expected corporate and bank collapses. Faithfully obeying orders from Washington, Finance Minister Lim had removed all exchange controls from the currency market with the result of enticing further speculative assaults against the won. (2)Two days later, November 26th, the IMF mission headed by Mr. Hubert Neiss arrived at Seoul’s Kimpo airport. And barely four days later on the 30th, the parties had already agreed on a Preliminary Agreement. The draft text had been prepared at IMF headquarters in Washington prior to the arrival of the mission. The policy solutions had already been decided in consultation with Wall Street and the US Treasury: no analysis or negotiation was deemed necessary.
Arm Twisting in the wake of the Presidential Race
But the deal was not yet wrapped up. The country was on the eve of a presidential election, and the front-runner opposition centre-left candidate Kim Dae jung remained firmly opposed to the IMF bailout agreement. He warned public opinion and accused the outgoing government of organising a massive sell-out of the Korean economy:’Foreign investors can freely buy our entire financial sector, including 26 banks, 27 securities firms, 12 insurance companies and 21 merchant banks, all of which are listed on the Korean Stock Exchange, for just 5.5 trillion won,’ that is, $3.7 billion. (3)
Political turnaround
Barely two weeks later, upon winning the presidential race, Kim Dae jung had become an unbending supporter of strong economic medicine:I will boldly open the market. I will make it so that foreign investors will invest with confidence; in a mass rally he confirmed his unbending support for the IMF Pain is necessary for reform and we should take this risk as opportunity. (4)Succumbing to political pressure, Kim Dae jung, a former dissident, political prisoner and starch opponent of the US backed military regimes of Park Chung Hee and Chun Doo Hwan, had caved in to Wall Street and Washington prior to his formal inauguration as the country’s democratically elected president. In fact Washington had demanded in no uncertain terms that all three candidates in the presidential race commit themselves to adopting the IMF programme.
Enforcing Enabling Legislation through Financial Blackmail
Kim Dae jung had also given a green light to the Korean parliament. A special session of the Legislature was held on the following day, December 23. The four main government motions concerning the IMF Agreement were adopted virtually without debate. (5) Enforced through financial blackmail, legislation had also been approved which stripped the Ministry of Economy and Finance and of its financial regulatory and supervisory functions. South Korea’s Parliament had been transformed into a rubber stamp. Meanwhile, Moody’s Investor Service, the Wall Street credit agency, acting on behalf of US banking interests, had rewarded Korea’s compliance by downgrading ratings for Korean government and corporate bonds, including those of 20 banks, to ’junk bond’ status. (5)Negotiating a $57 Billion Bailout: Timetable of the Heist
19 November 1997- 24 December 1997
19 November: Outgoing President Kim Young-sam fires Minister of Finance Kang Kyong-shik for hindering negotiations with the IMF. Kang is replaced by Mr. Lim Chang-yuel, a former Executive director of the IMF.
20 November: Finance Minister Lim is rushed off to Washington for talks with his former colleague, IMF Deputy Managing Director Stanley Fischer.
21 November: The Repulbic of Korea (ROK) government formally announces that it will be seeking an Agreement with the IMF. The New Finance Minister is put in charge of negotiations with the IMF.
24 November: Seoul Black Monday. The Seoul stock market crumbles to a ten year low over feared IMF austerity measures and expected corporate and bank collapses.
26 November: The IMF mission arrives in Seoul headed by Mr. Hubert Neiss.
27 November: Shrouded in secrecy, talks between the IMF mission and ROK government officials commence.
30 November: After four days of negotiations, the IMF and the Government agree on a Preliminary Agreement.
1 December: The draft agreement is submitted to the approval of the ROK Cabinet.
3 December: IMF Managing Director Michel Camdessus arrives in Seoul to wrap up the deal. US Undersecretary of the Treasury David Lipton in discussions with Camdessus states that the deal cannot be finalized unless all three presidential candidates give their support to the IMF bailout.
4 December: The final text of the Agreement is ratified by the IMF Executive Board which approves a stand by arrangement for 21 billion dollars out of a total package of 57 billion.
5 December: Presidential candidate Kim Dae-jung expresses his opposition to the IMF Agreement and warns public opinion on its devastating economic and social impacts.
18 December: Kim Dae-jung wins the Presidential election and immediately declares his unconditional support for the IMF programme
22 December: US Under-secretary of the Treasury David Lipton arrives in Seoul. Lipton demands Kim Dae Jung to agree to massive layoffs of workers.
23 December: A special session of the Legislature is called. The Legislature rubber stamps four key government motions regarding the IMF programme.
24 December: Wall Street bankers are called to an emergency meeting on Christmas Eve. At midnight, the IMF agrees to rush 10 billion dollars to Seoul to meet an avalanche of maturing short-term debts.
26 December: Boxing Day: President-elect Kim Dae jung commits himself to tough actions: Companies must freeze or slash wages. If that proves not enough, layoffs will be inevitable.
Wall Street Bankers meet on Christmas Eve
The Korean Legislature had met in emergency sessions on December 23. The final decision concerning the 57 billion dollar deal took place the following day, on Christmas Eve December 24th, after office hours in New York. Wall Street’s top financiers, from Chase Manhattan, Bank America, Citicorp and J. P. Morgan had been called in for a meeting at the Federal Reserve Bank of New York. Also at the Christmas Eve venue, were representatives of the big five New York merchant banks including Goldman Sachs, Lehman Brothers, Morgan Stanley and Salomon Smith Barney.(6)
And at midnight on Christmas Eve, upon receiving the green light from the banks, the IMF was allowed to rush 10 billion dollars to Seoul to meet the avalanche of maturing short-term debts. (7)
The coffers of Korea’s central Bank had been ransacked. Creditors and speculators were anxiously awaiting to collect the loot. The same institutions which had earlier speculated against the Korean won were cashing in on the IMF bailout money. It was a scam.
Dismantling the Chaebols
The IMF bailout had derogated Korea’s economic sovereignty, establishing a de facto colonial administration under a democratically elected president. It had plunged the country virtually overnight into a deep recession. The social impact was devastating. The standard of living collapsed; the IMF reforms depressed real wages and triggered massive unemployment.The devaluation of the won, together with the stock market meltdown, generated a deadly chain of bankruptcies affecting both financial and industrial enterprises. The hidden agenda was to destroy Korean capitalism. The IMF program contributed to fracturing the chaebols.
Chaebol’s are conglomerates of many companies clustered around one holding company. The parent company is usually controlled by one family. In 1988, the 40 top chaebol grouped a total of 671 separate companies. Hyundai and Daewoo are examples. They produce widely differing products, everything from cars to TV sets. Chaebols do not, and this is important, control banks. (What is a chaebol?, at http://megastories.com/seasia/skorea/chaebol/chaewhat.htm)The latter had been invited to establish strategic alliances with foreign firms meaning their eventual takeover and control by foreign capital. Acting directly on behalf of Wall Street, the IMF had demanded the dismantling of the Daewoo Group including the sell-off of the 12 so-called troubled Daewoo affiliate companies. Daewoo Motors was up for grabs. Korea’s entire auto parts industry was in crisis leading to mass layoffs and bankruptcies of auto-parts suppliers. (8)
Meanwhile, the creditors of Korea’s largest business empire, Hyundai, had demanded that group’s break-up. With the so-called spin off, meaning the fracture of Hyundai, foreign capital had been invited in to pick up the pieces, meaning Hyundai’s profitable car and ship building units,at good prices. Korea’s high tech, electronics and manufacturing economy was up for grabs. Western corporations had gone on a shopping spree, buying up industrial assets at rock-bottom prices. The devaluation of the won, combined with the slide of the Seoul stock market, had dramatically depressed the dollar value of Korean assets.
California and Texas Tycoons to the Rescue
America had come to the rescue of Korea’s ’troubled banks’. For a meager $454 million, a controlling share (51%) of Korea First Bank (KFB) was transferred to Newbridge Capital Ltd, a US outfit specializing in leveraged buyouts.(9) In one fell swoop, a California-based investment firm, with no visible prior experience in commercial banking, had gained control of one of Korea’s oldest banking institutions with 5,000 employees and a modern network of branch offices through out the country.Under the terms of its agreement with Newbridge, the ROK government had granted so-called put back options to KFB (Korea First Bank) which entitled the new owners to demand compensation for all losses stemming from non-performing loans made prior to the sale.
What this meant in practice was a total cash injection by the ROK government (in several installments) into the KFB of 17.3 trillion won, an amount equivalent to 35 times the price Newbridge Capital had paid the government in the first place. (10)
In a modern form of highway robbery, a totally fictitious investment of 454 million dollars by Newbridge had enabled the new owners to cash in on a 15.9 billion dollar government hand-out. Not bad! And behind this lucrative scam, the Wall Street underwriter Morgan Stanley Dean Witter was also cashing in on fat commissions from both the ROK government and the new American owners of KFB.
And how was the government going to finance this multi-billion dollar handout? Through lower wages, massive layoffs of public employees including teachers and health workers, drastic cuts in social programs as well as billions of dollars of borrowed money.
Financed by the Korean Treasury, the new Texan and Californian owners of KFB had become domestic creditors of Korea’s troubled business conglomerates. Without having risked a single dollar, they now had the power to shake up, downsize or close down entire branches of Korean industry as they see fit, including electronics, automobile production, heavy industry, semiconductors, etc. Most of the business takeover proposals and spin-offs of the chaebols required the direct consent of Western financial interests. The fate of the workers of the chaebols was also in the hands of the new American owners.
The ROK government had not only lost control over the privatization program, it had allowed the entire financial services industry to be broken into. Chase Manhattan had purchased a majority interest in Good Money Securities. Goldman Sachs’ had acquired control of Kookmin Bank while New York Life had taken over its insurance arm Kookmin Life.(11)
The wholesale privatization of major public utilities had also been demanded, including Korea Telecom and Korea Gas. Korea Electric Power Corporation (KEPCO) was to be broken down into several smaller electricity companies prior to being placed on the auction block. Pohang Iron & Steel Corp. (POSCO) was also to become fully privatized. A similar fate awaits Hanjung, the State owned Korea Heavy Industries and Construction Company, slated to enter into a strategic alliance with Westinghouse.
Instating a System of Direct Colonial Rule
The system of indirect colonial rule first instated by the US Military under President Sygman Rhee in 1945 had been disbanded. Korea’s ruling business elites had been crushed. An entirely new system of government under President Kim Dae Jung had been established, geared towards the fracture of the chaebols and the dismantling of Korean capitalism. In other words, the signing of the IMF bailout Agreement in December 1997 marks an important and significant transformation in the structure of the Korean State. It also marks a decisive step in inter-Korean relations and Washington’s design to extend the free market to the entire Korean Peninsula.Reunification and the Free Market
An IMF negotiating mission was rushed to Seoul in early June 2000, barely a few days before the historic inter-Korean Summit in Pyongyang between President Kim Dae jung and Democratic People’s Republic of Korea (DPRK) Chairman Kim Jong il. Careful timing. The IMF’s presence in Seoul was barely noticed by the Korean press. Firmly behind Kim Dae jung, South Koreans had their eyes riveted on the promise of the country’s reunification. Other political issues were shoved to the sidelineMeanwhile backstage, removed from the heat of public debate, the IMF team was quietly putting the finishing touches on a new IMF Agreement to be duly signed by Finance Minister Lee Hun-jai, prior to his departure for the Pyongyang Summit.
It was a carefully planned sell-out: the June 2000 Agreement was more deadly than the first one signed in December 1997. In it, the ROK government renewed the IMF’s stranglehold on the Korean economy until 2003 without the occurence of any form of public debate or discussion. The dismantling and fracturing of South Korean capitalism was carefully outlined, to occur over a three year period, from 2000 to 2003. (12)
But the IMF mission had something else up its sleeve. In liaison with the US Embassy, the IMF mission briefed Finance Minister Lee Hun-jai, who was in charge of the Pyongyang Summit’s economic cooperation agenda. Lee was a faithful crony of the IMF. Prior to assuming the position of Finance Minister, he was in charge of the infamous Financial Supervisory Commission (FSC), the powerful IMF sponsored Watch Dog, responsible for triggering the bankruptcy of the chaebols.
Carefully briefed before his departure for Pyongyang, Finance Minister Lee was to uphold American business interests under the disguise of inter-Korean economic cooperation. Washington’s hidden agenda under the reunification process is the eventual recolonization of the entire Korean peninsula.
Colonizing North Korea
Under the inter-Korean economic cooperation program signed in Pyongyang, the Seoul government committed itself to investing in the North Korea. Hyundai, Korea’s largest conglomerate, was to invest and build factories in the North.But the Korean chaebols, including Hyundai, are rapidly being taken over by American companies. In other words, inter-Korean economic cooperation may turn out to be a disguised form of foreign investment and a new window of opportunity for Wall Street. The new American owners of the chaebols in consultation with the US State Department will ultimately be calling the shots on inter-Korean economic cooperation including major investments in North Korea:
Kim Dae Jung’s strategy is to help Pyongyang with aid and development, tap its cheap labor and build goodwill and infrastructure that are also in South Korea’s interest Everyone has to keep up the pretense that nothing will happen to the North Korean regime, that you can open up and keep your power and we’ll help you make deals with the International Monetary Fund and World Bank… But ultimately, we hope it does undermine them. It’s the Trojan horse. (13)The government of Nobel Peace Laureate President Kim Dae jung had set the stage on behalf of Washington. With US military might in the background, the promise of reunification, to which all Koreans aspire, could lead to the imposition of so-called free market reforms on Communist North Korea, a process which would result in the recolonization and impoverishment of the entire Korean peninsula under the dominion of American capital.
Notes
1.Agence France Presse , 19 November 1997.2. Willis Witter, Economic Chief sacked in South Korean Debt Crisis; Emergency measures are introduced, Washington Times, 20 November 1997. See also International Monetary Fund, Korea: Request for IMF Standby, includes Letter of Intent and Memorandum on the Economic Programme, see para. 32, p. 44. The text can be consulted at http://www.chosun.com/feature/imfreport.html. Also quoted in Michael Hudson, Draft for Our World, Our World, Kyoto, 23 December 1997.
3. National Public Radio, 19 December 1997.
4. John Burton, Korea bonds reduced to junk status, Financial Times, London, 23 December 1997. P. 3.
5. Financial Times, 27-28 December 1997, p. 3.
6. Agence France Presse, Paris, 26 December 1997.
7. Autoparts makers step up resistance to Foreign Control of Daewoo Motor, Korea Herald, 28, June 2000.
8. See Michael Zielenziger, A rebounding but unreformed South Korea making investors, officials nervous, Knight Ridder Tribune News Service, 11 June 1999
9. More Tax Money for KFB, Korea Herald, Seoul, 17 August 2000, p. 1
10 Ibid
11. Struggle to survive will intensify amid M&As, Business Korea, Vol 17, No 2, February 2000, p. 30-36.
12. Text of Memorandum of Economic and Financial Policies and Letter of Intent, June 14, Ministry of Finance, Seoul, 2000, published in the Republic of Korea Economic Bulletin, June 2000 at http://epic.kdi.re.kr/home/ecobul/indexlist.htm. Also published by the International Monetary Fund (IMF) at http://www.imf.org/external/NP/LOI/2000/kor/01/INDEX.HTM. The Memorandum grants management rights to Deutsche Bank over KFB.
13 Los Angeles Times, June 16, 2000
Source: http://www.globalresearch.ca/the-recolonization-of-korea/719
Thursday, April 4, 2013
Friday, March 29, 2013
Public Banking Needed to Stop "Cannibalization" of the Economy
Michael Hudson: As long as finance is left in private hands, you're going to have austerity and America ending up looking like Greece and Ireland
Monday, March 25, 2013
Monday, March 18, 2013
"Everyone But China" Agreement Prevents Regulation of Hot Money and Speculation
Kevin Gallagher: The TPP, an everyone but China agreement, would make it illegal for countries to regulate the flow of hot money and speculation.
Time for China to punish US Client States in Asia by restricting access to Chinese market for those that have sold out their countries national interests to access US market at any price including Vietnam.
Sunday, March 17, 2013
Banks, Gold and Guns
David L. Smith of Geneva Business Insider.blogspot.com joins us for our monthly discussion on economics, finance and politics.
This month we cover the fudging of the Basel III accords, the state of the Swiss central bank and other central banks around the world in 2013.
Sunday, February 24, 2013
Clinton's Policy of Not Prosecuting Bank Fraud Continues
Bill Black: Clinton admin. thought that prosecuting big bank fraud wasn't worth the governments time and could destabilize banking system - Obama continues the policy today
Thursday, February 21, 2013
Sunday, February 17, 2013
Monday, February 11, 2013
Sunday, January 27, 2013
Breaking Up the Big Banks is Not a Solution
Leo Panitch: Global capitalism needs massive banks, but big private banks have the power to prevent regulation and threaten more crisis; the solution is not breaking them up but making them public
Saturday, January 26, 2013
UK heads for triple dip as Economy shrinks
Political Economy Research does not agree with right wing prescriptions to UK economic problems of Mark Littlewood of the Institute of Economic affairs a think tank proponent of more savage cuts.
Friday, January 25, 2013
Wednesday, January 23, 2013
Sunday, January 20, 2013
Alfred Russell Wallace address to Land Nationalisation Society in 1895
The Only Solution to the Problem
of the Unemployed
[[p. (9)]] We are now approaching the end of a century which has far surpassed all preceding centuries in the increase of man's power over natural forces, and consequent enormous increase in the production of wealth. The amount of this increase may be judged from the fact that, fifteen years ago, the amount of actual steam-power in Great Britain amounted to about ten times the labour-power of the whole working population. It is now certainly much greater, and by the use of labour-saving machinery, this amount of mechanical power is again increased probably ten-fold in efficiency, so that our people now perform a hundred times as much productive work as during the preceding centuries when steam power and machinery were hardly used at all. Yet with this hundredfold-capacity for producing the food, clothing, and other commodities needed for the satisfaction of all the wants of human nature and the comforts and enjoyments of life, what do we find? Huge masses of people suffering untold misery and want in all our great cities, and in country villages surrounded by game-preserves and untilled fields; an increasing number dying of actual starvation; insanity and suicide increasing [[p. 10]] more rapidly than the population; and, according to a very competent authority, a Prison Chaplain, who has studied the statistics of crime for thirty years, an equally large increase in crime and in the prison population.1
As confirming and illustrating all these terrible facts, we have the Yearly Reports of the Registrar General, showing that for the last forty years there has been a continuous increase in the proportion of deaths occurring in workhouses, hospitals, asylums, and other public charitable institutions, from 16 per cent. of the total deaths (in London) in the five years, 1856-60, to 26 per cent. in 1886-90; and a similar increase, though not quite so rapid, is shown for the whole kingdom.
Co-incident with all these facts, and to some extent explaining them, is the continual depopulation of the rural districts and increase of town and city populations, certainly largely due, and I believe wholly so, to the monopoly of land in the hands of the landlord class, which has always forbidden and still forbids the free use of their native soil on fair terms to the workers. Hence has arisen the phenomenon of an ever-increasing lack of permanent employment; the flocking of large numbers of rural labourers and their families to the towns; the increase of poverty, starvation, suicide, insanity, and crime; millions of acres of land going out of cultivation, and the cry of agricultural depression, now raised the more loudly because the pockets of the landlords themselves are affected by it. Most of the aspects of the "problem of poverty" above adverted to I have dealt with more or less fully elsewhere, [[p. 11]] as have many well-known Socialist writers. My present object is to suggest an immediate practical remedy for some of the worst features of the present state of things, by with-drawing from the labour-market the superabundant workers and rendering them wholly self-supporting on the land. This once effected every other worker in the kingdom will be benefitted, and the movement for a greatly-improved organisation of society will be advanced by a practical illustration of the enormous waste involved in the capitalistic and competitive system that now prevails.2
The problem of general unemployment is well stated by Mr. J. A. Hobson in the Contemporary Review of April, 1895 ("Is Poverty Diminishing?"). He says:--"Why is it that, with a wheat-growing area so huge and so productive that in good years whole crops are left to rot in the ground, thousands of English labourers, millions of Russian peasants, cannot get enough bread to eat? Why is it that with so many cotton mills in Lancashire that they cannot all be kept working for any length of time together, thousands of people in Manchester cannot get a decent shirt to their backs? Why is it that, with a growing glut of mines and miners, myriads of people are shivering for lack of coals?" Now, not one of our authorised teachers of political economy, not one of our most experienced legislators can give any clear answer to these questions, except by vague reference to the immutable laws of supply and demand, and by the altogether false statement that things are not so bad as they were, and that in course of time they will improve of themselves. Mr. H. [[p. 12]] V. Mills had his attention directed to this subject by an individual instance of the same phenomena. He found in Liverpool, next door to each other, a baker, a shoemaker, and a tailor, all out of work, all wanting the bread, clothes and shoes which they could produce, all willing and anxious to work, and yet all compelled to remain idle and half starving. His book has been before the world several years; it contains a practical and efficient remedy for this state of things; yet no attempt whatever has been made to give his plan a fair trial. Let us therefore see if we can throw a little more light on the problem, and thus help to force it upon the attention of those who have the power, but who believe that nothing can be done.
The answer to the question so well put by Mr. Hobbs [[Hobson?? --Ed.]], and which Mr. Stead, in the Review of Reviews, considers to be the modern problem of the Sphinx which it needs a modern Œdipus to solve, is nevertheless perfectly easy. To put it in its simplest form it is as follows:--Unemployment exists, and must increase, because, under the conditions of modern society, production of every kind is carried on, not at all for the purpose of supplying the wants of the producers, but solely with the object of creating wealth for the capitalist employer.
Now, I believe, that this statement contains the absolute root of the whole matter, and indicates the true and only lines of the complete remedy. But to many it will be a hard saying; let us therefore examine it a little in detail.
The capitalist cotton-spinner, cloth or boot-manufacturer, colliery-owner, or iron-master, care not the least who buys their goods or who uses them, so long as they can get a good price for them. The cotton, the boots, the coals, or the iron, may be exported to India or Australia, to America or [[p. 13]] to Timbuctoo, while millions are insufficiently clad or warmed in the very places where all these things are made. Even the very people who make them may thus suffer, through insufficient wages or irregular employment; yet the upholders of the present system will not admit that anything is fundamentally wrong. The lowness of wages and irregularity of employment, are, they tell us, due to general causes over which they have no control--such as foreign competition, insufficient markets, etc., which injure the capitalists as well as the workers. The unemployed exist, they say, on account of the improvements in machinery and in mechanical processes in all civilised countries, which economise labour and thus render production cheaper. The surplus labour, therefore, is not wanted; and that portion of it which cannot be absorbed in administering to the luxury of the rich must be supported by charity, or starve. That is the last word of the capitalists and of the majority of the politicians. But though capitalists and politicians are satisfied to let things go on as they are, with ever increasing wealth and luxury on the one hand, ever increasing misery and discontent on the other, thinking men and women all over the world are not satisfied, and will not be satisfied, without a complete solution of the problem; which, though they are not yet able to see clearly, they firmly believe can be found.
Governments in modern times, have gone on the principle that they have nothing whatever to do with the employment or want of employment of the people,--with high wages or low wages, with luxury or starvation, except inasmuch as the latter calamity may be prevented by the poor-law guardians. A great change has, however, occurred in the [[p. 14]] last few years. Both the local and imperial Governments have admitted the principle of a reasonable subsistence-wage, and are acting upon it, in flagrant opposition to the principles of the old political economy. Now, too, I observe, the buying of Government stores abroad, because they can be obtained a fraction per cent. cheaper than at home, is being given up, though only three or four years ago the practice was defended as being in accordance with true economical principles, and also because it was the duty of the Government to buy as cheaply as possible in the interest of the taxpayer. I only mention these facts to show that new ideas are permeating modern society, and are compelling Governments, however reluctantly, to act upon them. We may, therefore, hope to compel our rulers to acknowledge that it is their duty also to provide the conditions necessary to enable those who are idle and destitute--from no fault of their own, but solely through the failure of our competitive and monopolist system--to support themselves by their own labour. Hitherto they have told us that it cannot be done, that it would disorganise society, that it would injure other workers. We must, therefore, show them how it can be done, and insist that at all events the experiment shall be tried. I will now give my ideas of how this great result can be brought about, and the reasons which I believe demonstrate that the method will be successful.
Hitherto there has been no organisation of communities or of society at large for purposes of production, except so far as it has arisen incidentally in the interest of the capitalist employers and the monopolist land-owner. The result is the terrible social quagmire in which we now find [[p. 15]] ourselves. But it is certain that organisation in the interest of the producers, who constitute the bulk of the community, is possible; and as, under existing conditions, the millions who are wholly destitute of land or capital cannot organise themselves, it becomes the duty of the State, by means of the local authorities, to undertake this organisation; and if it is undertaken on the principle that all production is to be, in the first place, for consumption by the producers themselves, and only when the necessary wants of all are satisfied, for exchange in order to procure luxuries, such organisation cannot fail to be a success.
My confidence in its success is founded on three considerations, which I will briefly enumerate. The first is, the enormous productive power of labour when aided by modern labour-saving machinery. Mr. Edward Atkinson, admitted to be the greatest American authority on the statistics of production and commerce, has calculated that two men's labour for a year in the wheat-growing States of America will produce, ready for consumption, 1,000 barrels of flour, barrels included; and this quantity will produce bread for 1,000 persons for a year. Now as we can grow more bushels of wheat an acre than are grown in America, we could also produce the bread for 1,000 persons by the labour of say four or five men, including the baking. Again, he tells us that, with the best machinery, one workman can produce cotton cloth for 250 people, woollen goods for 300, or boots and shoes for 1,000. And as other necessaries will require an equally moderate amount of labour, we see how easily a community of workers could produce, at all events all the necessaries of life, by the expenditure of but a small portion of their total labour-power.
[[p. 16]] The next consideration is, that in the Labour Colonies of Holland, the unemployed are so organised as to produce all that they consume, or its value, without the use of any labour-saving machinery. The reason they have none, the director told Mr. Mills, is that it would lead to a difficulty in finding work for the people of the colony, and it would then be less easy to manage them. The difficulty in this case seems to be to provide against the possibility of a too great success!3
The third consideration which points to the certainty of success, is, the demonstrable enormous waste of the present capitalistic and competitive system; and the corresponding enormous economies of a community in which all production would be carried on primarily for consumption by the producers themselves. This economy will be illustrated as we consider the organisation of such a community.
A careful consideration of the whole problem by experts will determine the minimum size of a colony calculated to ensure the most economical production of all the chief necessaries of life. Let us take it at about 5,000 persons, including men, women, and children, which is Mr. Mills' estimate. Enough land will be required to grow all the kinds of produce needed, both vegetable and animal--say two to three thousand acres--and a skilled manager will be engaged to superintend each separate department of industry. Not only will bread, vegetables, fruit, and meat of all kinds be grown on the land, but the whole of the needful manufactures will be carried on, aided by steam, water, or wind power, as may be found most convenient and economical. To provide clothes, tools, furniture, [[p. 17]] utensils, and conveniences of all kinds for 5,000 people, workshops and factories of suitable dimensions will be provided, and skilled workers in each department will be selected from among the unemployed or partially employed. A village with separate cottages or lodgings for families and individuals, with central cooking and eating-rooms for all who desire to use them, would form an essential part of the colony. The village would be built on a high yet central position, so that all the sewage could be applied by gravitation to the lower and more distant portions of the land, while all the solid refuse and manurial matter would be applied to the higher portions. Here would be the first great economy, both in wealth and health. Every particle of sewage and refuse would be immediately returned to the land, where, under the beneficent action of the chemistry of nature, it would be again converted into wholesome food and other products.
Another economy, of vast amount, but difficult to estimate, would arise from the whole effective population being available to secure the crops when at their maximum productiveness. Who has not seen, during wet seasons, hay lying in the fields week after week till greatly deteriorated or completely spoilt; shocks of wheat sprouting and ruined; fruit rotting on the ground; growing crops choked with weeds,--all involving loss to the amount of many millions annually, and all due to the capitalistic system which has led to the overcrowding of the towns and the depopulation of the rural districts. But this is only a portion of the loss from deficiency of labour at the critical moment. Agricultural chemists know that, even in good seasons, a considerable portion of the nutritious qualities of [[p. 18]] hay is lost by the cutting of the grass being delayed a few days or weeks, owing to uncertain weather, the pressure of other work, or a deficiency of labour. The critical moment is when the grass is in flower. Every day later it deteriorates; and in our self-supporting colonies the whole population would be available to supply whatever assistance the head farmer required to get the hay made in the best possible condition. A single fine day, utilised, with the aid of machinery and ample labour, would often save hundreds of pounds value to the colony. The same would be the case with wheat and other corn crops, as well as with fruit and vegetables.
In such a colony education could be carried on in a rational manner not possible under the present conditions of society, where the means of industrial training have to be specially provided. Ordinary school work would be at the most three or four hours daily; the remainder of the working day being devoted to various forms of industrial work. Every child would be taught to help in the simpler agricultural processes, as weeding, fruit gathering, etc.; and besides this each person would learn at least two trades or occupations, more or less contrasted; one being light and sedentary, the other more active and laborious, and involving more or less out-door work. By this means not only would a pleasant and healthful variety of occupation be rendered possible for each worker, but the community would derive the benefit of being able to concentrate a large amount of skilled labour on any pressing work, such as buildings or machinery.
But perhaps the greatest economy of all would arise from such a community being almost wholly free from [[p. 19]] costs of transit, profits of the middleman, and need for advertising. The total amount of this kind of waste, on the present system, is something appalling, and can be best realised by considering the difference between the cost of manufacture and the retail price of a few typical articles. Wheat is now about 22s. to 24s. a quarter, which quantity yields nearly six hundred pounds of bread. In our proposed community the labour of making the flour would be repaid by the value of the pollard and bran, while the bread-making would employ two or three men and women. The actual cost of their four-pound loaf, reckoning the labourers to receive present wages, would be about 2d., while it now costs 3 1/2d. or 4d.--a saving of at least 40 or 50 per cent. Again, the best Cork butter sells wholesale at 8d. a pound, the actual maker probably getting no more than 7d., while the retail consumer has to pay double--here would be a saving of at least 50 per cent. Milk is sold wholesale by the farmers at about 7d. a gallon, while it is retailed at 16d. a gallon--a saving of more than 60 per cent. In meat there would be, probably, about the same saving as in bread; in vegetables and fruit very much more; in coals bought wholesale from the pit, as compared with the rate at which it is sold by the hundredweight or the pennyworth to the poor in great cities, an equally large saving. And in addition to all this there would be the economy in the cooking for a large community; in the freshness and good quality of all food and manufactured products; and, further, in the saving of labour by all those improvements in gas and water supply, in disposing of refuse, in warming and ventilation, which can be easily provided for a large community living in a compact and well arranged set of buildings.
[[p. 20]] Taking all these various economies into consideration, it is probably far below the mark to say that our present system of production on a huge scale for the benefit of capitalists and landlords only, on the average doubles the cost of everything to the consumer; that is to say, the cost of distribution is equal to, and often much greater than, the cost of production. And this is said to be an economical system! A system too perfect, and almost too sacred to be touched by the sacrilegious hands of the reformer! We are to go on for ever spending a pound to get every pound's worth of goods from the producer to the consumer; just as under our Poor Law system it costs a shilling to give a starving man a shilling's worth of food and lodging.
But there is yet another economy, which I have not hitherto mentioned, and which may perhaps be said to be far greater in real value and importance than all the rest, and that is the economy to the actual producer, of time, of labour, of health, and the large increase in his means of recreation and happiness. Agricultural labourers now often have to walk two or three miles to their work; mill-hands, including women and children, walk long distances in all weathers to be at the mill-gates by six in the morning; workers by the million undergo a process of slow but certain destruction in unsanitary workshops, or in dangerous or unhealthy occupations, many of which (as making the enamelled iron advertising plates, for example) are quite unnecessary for the needs of a properly organised community; while in all cases it is only a question of expense to save the workers from any injury to health. In our self-supporting communities, all these sources of waste and misery would be avoided. All work would be near at hand. [[p. 21]] No work permanently injurious to health would be permitted; while the alternations of outdoor and indoor work, together with the fact that every worker would be working for himself, for his family, and for a community, of which he formed an integral part on an equality with all his fellow-workers, would give a new interest to labour similar to that which every gardener feels in growing vegetables for his own table, and every mechanic in fitting up some useful article in his own house. Then again, while living in and surrounded by the country and enjoying all the advantages and pleasures of country life, a community of five thousand persons would possess in themselves the means of supplying most of the relaxations and enjoyments of the town, such as music, theatricals, clubs, reading-rooms, and every form of healthy social intercourse.
Are all these economies, and all this health and comfort for a large population, of less importance to the nation than the increased wealth of one or two capitalists? Must thousands or millions continue to have their lives shortened, and during their short lives have a minimum of the comforts and pleasures of life in order that a few may be inordinately rich? I earnestly call upon all who have the welfare of humanity at heart, to consider at what needless cost to the workers the boasted wealth of the nation is now produced.
This is not the place to go into the minute details of the establishment of such communities, but a few words as to ways and means may be considered necessary.
It has been estimated that the capital required to buy the land and start such a colony would not exceed two years' poor rates of a Union where there are an equal number [[p. 22]] of paupers. But there is really no necessity for buying the land. It might be taken where required at a fair valuation and paid for by means of a terminable rental, similar to that by which Irish tenants have been enabled to purchase their farms; but in this case the county would be the purchaser, not an individual, and after the first year, or perhaps two years, this rent-charge would be easily payable by the colony. The capital needed for buildings, machinery, and one year's partial subsistence, should be furnished, half by the County or Union, and half by the Government, free of interest, but to be repaid by instalments to commence after, say, five or ten years. It would really be to the advantage of the community at large to give this capital, since it would inevitably lead to the abolition of unemployment and of able-bodied pauperism, and the saving thus effected would more than repay the initial outlay.
In each Colony there would be grown or manufactured a considerable amount of surplus produce, which would be sold in order to purchase food which cannot be produced at home--as tea, coffee, spices, etc., and also such raw materials as iron and coal. The things thus produced for sale would vary according to the facilities for its production and local demand. In some colonies it would be wheat or barley, in others, butter and cheese, in others again, flax, vegetables, fruit, or poultry, in others perhaps, leather or wool. And as all the products of our soil except milk are largely imported, there is ample range for producing articles for sale which would not in any way affect prices or interfere with outside labour.
At first, of course, such colonies must be organised and all the work done under general regulations and the same [[p. 23]] discipline as is maintained in any farm or factory, but with no unnecessary interference with liberty out of working hours. Accounts would be strictly kept and audited, and all profits would go to increasing the comfort of the colonists in various ways, and in paying surplus wages to be spent, or saved, as the individual pleased. Under reasonable restrictions as to notice every one would be at liberty to quit the colony; but with such favourable conditions of life as would prevail there it is probable that only a small proportion would do so. None, apparently, quit the Dutch colony of Frederiksoord.
But as time went on, and a generation of workers grew up in the colony itself, a system of self-government might be established; and for this purpose I think Mr. Bellamy'sa method the only one likely to be a permanent success. It rests on the principle that, in an industrial community, those only are fit to be rulers who have for many years formed integral parts of it, who have passed through its various grades as workers or overseers, and who have thus acquired an intimate practical acquaintance with its needs, its capacities, and its possibilities of improvement. Persons who had themselves enjoyed the advantages of the system, and who had suffered from whatever injudicious restrictions or want of organisation had prevailed, and who had nearly reached the age of retirement from the more laborious work, would be free from petty jealousies of their fellow workers, and would have no objects to aim at except the continued success of the colony and the happiness of all its inmates. On this principle those who had worked in the colony for at least fifteen or twenty years, and who had reached some grade above that of simple workmen, should form the [[p. 24]] governing body, appointing the superintendents of the various departments, and making such general regulations as were needed to ensure the prosperity of the community and the happiness of all its members.
Now, I would ask, what valid reason can be given against trying this great experiment in every county in Great Britain and Ireland, so as at once to absorb the larger part of the unemployed as well as all paupers who are not past work? The only real objection, from the capitalist's point of view, that I can imagine, is, that colonies in which the whole of the produce went to the workers themselves, including of course their own sick and aged, would be so attractive that they would draw to them large numbers of workers of all kinds, and thus interfere with the capitalists' labour supply. This, I believe, would, after a few years, inevitably occur; but, from my point of view, and from that probably of most workers, that circumstance would afford the greatest argument in favour of the scheme. For it would show that, with a proper organisation of labour, capitalist production was unnecessary; it would afford practical proof that labourers can successfully produce without the intervention of capitalist employers; and if they can do so it will hardly be contended that unemployment and pauperism must be maintained for the benefit of capitalists.
In this connection I will quote a passage from the writings of that remarkable observer and thinker, the late Richard Jeffrey. He says:--
"I verily believe that the earth in one year can produce enough food to last for thirty. Why then have we not enough? Why do people die of starvation, or lead a [[p. 25]] miserable existence on the verge of it? Why have millions upon millions to toil from morning till evening just to gain a mere crust of bread? Because of the absolute lack of organisation by which such labour should produce its effects, the absolute lack of distribution, the absolute lack even of the very idea that such things are possible. Nay, even to mention such things, to say that they are possible, is criminal with many. Madness could hardly go further."4
This was written a good many years ago. Now, we who hold such opinions are considered to be, not criminals, but merely cranks; and it is even allowed that we have good ideas sometimes, if only we were more practical. But surely nothing can be more practical than the proposal made here, since the experiment has already been tried in Holland, and has succeeded. To produce any real effect, however, it must be brought into operation on a large scale, and this can only be done by the local authorities, to whom must be given all necessary powers, with the needful financial assistance from the Government.
So soon as labour-colonies of the kind here suggested have been established for a few years, it is quite certain that the District Councils will no longer endure the old, bad, wasteful, and degrading system of the Union Workhouses, but will obtain land, in the vicinity of existing workhouses where possible, and establish labour-colonies of the same type. The effects of the new system will soon become palpable to every householder in the kingdom, in enormously decreased poor-rates, and the almost complete absence of the unemployed. Public opinion will then be all in favour of the new system, and legislation will be demanded and [[p. 26]] quickly obtained, enabling any number of persons, who wish to form such a community by voluntary association, to have the land required in any part of the county on a permanent tenure, and at a fair agricultural rental.
Numerous self-supporting co-operative labour-colonies being thus established all over the country, their connection by lines of tramways, where required, and the arrangements they would soon make for mutual assistance and exchange of commodities, for the common use of mills or of costly machinery, together with the healthy rivalry that would inevitably spring up, would still further increase the advantages to be derived from them. And these advantages would extend to every member of the community. For not only would the withdrawal of the whole surplus labour now represented by the unemployed or partially unemployed, inevitably cause a large rise in the rate of wages in all departments of industry; but the high standard of living, and the freedom from the anxiety now inseparable from capitalistic wage-labour would draw more and more of the workers to such communities, and thus compel capitalists to offer higher and higher wages, in order to obtain the services of the workers. This would result in the capitalist manufacturer being content with an amount of profit sufficient to repay him for his work as organiser and superintendent, as the only alternative to the loss of his fixed capital. The whole net profits of every industrial enterprise would then be distributed as wages to the various classes of workers, and Labour would, for the first time, receive its full and fair reward.
Notes Appearing in the Original Work
1. See "Increase of Crime," by Rev. W. D. Morrison in the Nineteenth Century of June, 1892. [[on p. 10]]
2. The suggestion that follows formed part of my Presidential Address to the Land Nationalisation Society in 1895.--[A.R.W.] [[on p. 11]]
3. See "Poverty and the State," by H. V. Mills, chapter X. [[on p. 16]]
4. "The Story of My Heart," p. 194. [[on p. 25]]
2. The suggestion that follows formed part of my Presidential Address to the Land Nationalisation Society in 1895.--[A.R.W.] [[on p. 11]]
3. See "Poverty and the State," by H. V. Mills, chapter X. [[on p. 16]]
4. "The Story of My Heart," p. 194. [[on p. 25]]


