Foreword by the Saker: I am absolutely delighted to submit to you today an article by Michael Hudson whom I consider to be the best and most visionary economic out there, bar none. Michael has kindly agree to allow me to post this article and, even better, he also agreed for a Q&A interview with me. To say that I am honored would be an understatement.
The Saker
Ukraine Labor Protests
by Michael Hudson
Ukraine’s collapse since the February 2014 coup has become an umbrella for grabitization. Collateral damage in this free-for-all has been labor. Many workers are simply not getting paid, and what actually is being paid is often illegally low. Employers are taking whatever money is in their business accounts and squirreling it away – preferably abroad, or at least in foreign currency.
Wage arrears are getting worse, because as Ukraine approaches the eve of defaulting on its €10+ billion London debt, kleptocrats and business owners are jumping ship. They see that foreign lending has dried up and the exchange rate will plunge further. The Rada’s announcement last week that it shifted €8 billion from debt service to spend on a new military attack on the country’s eastern export region was the last straw for foreign creditors and even for the IMF. Its loans helped support the hryvnia’s exchange rate long enough for bankers, businessmen and others to take whatever money they have and as many euros or dollars as they can before the imminent collapse in June or July.
In this pre-bankruptcy situation, emptying out the store means not paying workers or other bills. Wage arrears are reported to have reached 2 billion hryvnia, owed to over half a million workers. This has led the Federation of Trade Unions of Ukraine to picket against the Cabinet of Ministers on Wednesday (May 27). More demonstrations are scheduled for the next two Wednesdays, June 3 and 10. According to union federation Deputy Head Serhiy Kondratiuk, “the current subsistence wage of UAH 1,218 is 60% less than the level set in Ukrainian law, which is confirmed by the calculations if the Social Policy Ministry. … the subsistence wage in the country should exceed UAH 3,500 a month, but the government refuses to hold social dialog to revise standards.” [1]
The scenario that is threatened
Emptying out Ukrainian business bank accounts will leave empty shells. With Ukraine’s economy broken, the only buyers with serious money are European and American. Selling to foreigners is thus the only way for managers and owners to get a meaningful return – paid in foreign currency safely in offshore accounts, outside of future Ukrainian clawback fines. Privatization and capital flight go together.
So does short-changing labor. The new buyers will reorganize the assets they buy, declare the old firms bankrupt and erase their wage arrears, along with any other bills that are owed. The restructured companies will claim that bankruptcy has wiped out whatever the former firms (or public enterprises) owed to workers. It is much like what corporate raiders do in the United States to wipe out pension obligations and other debts. They will claim to have to “saved” Ukrainian economy and “made it competitive.”
Operation Vulture
The Pinochet coup in Chile was a dress rehearsal for all this. The U.S.-backed military junta targeted labor leaders, journalists, and potential political leaders, as well as university professors (closing every economics department in Chile except for the Chicago “free market”-based Catholic University). You cannot have a “free market” Chicago-style, after all, without taking such totalitarian steps.
U.S. strategists like to name such ploys after predatory birds: Operation Phoenix in Vietnam, and Operation Condor in Latin America that targeted “lefties,” intellectuals and others. A similar program is underway against Ukraine’s Russian speakers. I don’t know the code word being used, so let’s call it Operation Vulture.
For labor leaders, the problem is not only to collect back wages, but to survive with a future living wage. If they refrain from protesting, they simply won’t get paid. This is why they are organizing a growing neo-Maidan protest explicitly on behalf of wage earners – so that the junta’s Right Sector snipers cannot accuse the demonstrators of being pro-Russian. The unions have protected themselves by seeking support from the UN’s International Labour Organization (ILO), and from the International Trade Union Confederation in Brussels.
The most effective tactic to tackle the corruption that is permitting the non-payment of wages and pensions is to focus on the present regime’s foreign support, especially from the IMF and EU. Using labor’s grievances as an umbrella to demand related reforms could include warnings that any sale of Ukrainian land, raw materials, public utilities or other assets to foreign buyers can be reversed by future, less corrupt governments.
In labor’s favor is the fact that the IMF has violating its Articles of Agreement by lending for military purposes. As soon as its last loan was disbursed, Poroshenko announced that he was stepping up his war against the East. This brings the IMF loan close to being what legal theorists call an Odious Debt: debts to a junta taking power and looting the government’s Treasury and other assets in the public domain, leaving future governments to pay off what has been stolen.
Labor’s fight for a living wage is not only for retroactive shortfalls, but to put in place a recovery plan to protect against the economy being treated like Greece or Latvia, neoliberal style. U.S. strategists have been discussing whether they could dismiss the $3 billion that Ukraine owes Russia this Decemb er as an “odious debt”; or, perhaps, classify it as “foreign aid” and hence not collectible in practice. Ironic as it may seem, the Peterson Institute of International Economics, George Soros and other Cold Warriors have provided future Ukrainian governments with a repertory of legal reasons to reconstitute their economy foreign-debt free – leaving the government able to pay wage and pension arrears.
The alternative is for international creditors to win the case for putting foreign bondholders, the IMF and European Union first, and sovereign rights to prevent self-destruction second.
- “Trade unions to picket government weekly from May 27, 2015,” Interfax.
http://en.interfax.com.ua/news/general/267940.html ↑
OT
http://www.moonofalabama.org/2015/05/ahead-of-israel-expulsion-vote-us-orders-raid-on-fifa-.html
Says FIFA arrests were to avoid vote for Israel expulsion from FIFA
I posted the link yesterday, but I don’t think anybody’s reading it, so here’s excerpts:
Ahead Of Israel Expulsion Vote U.S. Orders Raid On FIFA
Today the U.S. ordered Swiss police to raid, incarcerate and extradite to the U.S. six FIFA officials for alleged corruption. The raid, with obviously pre-alarmed New York Times reporters on the scene, comes shortly before a FIFA vote to expel Israel from the association.
Palestinian group declared the situation in the West Bank far worse than apartheid that existed in South Africa because right-wingers and extremists in Israel want to “delete Palestine.” In the 1960s, FIFA suspended South Africa for decades after it failed to comply with the association’s nondiscrimination policies. The nation was also expelled from FIFA a month after the Soweto Youth Uprising of 1976.
The vote requires a 75% majority of the 209 FIFA members. There was a good chance that it was going to be successful.
But now, just by chance, the U.S. government ordered the Swiss police to raid the hotel where the main FIFA functionaries are residing to arrest some of them on corruption charges going back to the early 1990s. The U.S. wants these to be extradited to face a U.S. court.
Folks in Russia are also saying that the scandal has a a purpose to appoint a new leadership for the FIFA and have them overturn the decision to hold the world cup in Russia.
What do you make of that hypothesis?
There is a lot actually behind this. The Europeans cant challenge Blatter through election and Blatter’s main support is from Football Associations from other continents plus the Europeans are mad that Qatar and Russia are hosting World Cups. So all of them have joined forces against Blatter and co.
Two evils accomplished in one deed.
1) At minimum, there’s an inference that Russia must have used bribery to get the finals. Supporting thier “evil” Russia narrative.
2) To preserve the pristine image of the racist apartheid criminal enterprise known as Israel.
Another O’bomb-ass “Don’t do stupid stuff” foreign policy blunder. He just can’t help himself.
The aim, of course, is to take the Cup away from Russia, but also to enforce Western dominance over a global body where the White, European, Western Overlords no longer call the shots.
Typically, the Western MSM hate-mongering sewer has been speaking with a single voice, and quite a few are not hiding the fact that their hatred of Blatter is as much racist as due to any other cause. The fact that Blatter spent money in Africa to support football is characterised as ‘bribery’ and the ‘one country, one vote’ system also enrages them. That the untermenschen of Africa, Asia, Oceania and Latin America have supported Blatter has the racist thugs of Europe and North America threatening to ‘destroy’ FIFA and the next World Cup. This seems to me to be just another indication of how very badly the Western elites are coping with the West’s relative decline and the rise of the non-Western world. It has driven them crazy with rage that their superiority, in ‘morals’, ‘civilization’ and ‘race’ that has fed their narcissistic self-regard for 500 years, as they looted the non-Western world and enslaved and exterminated hundreds of millions, is now being questioned by their inferiors. Hence this filthy, racist, spectacle. And Blatter did try to ensure his survival by surrendering to Israeli threats and sabotaging Palestine’s efforts to have Israel punished for its racist barbarism.
Follow the Money: Major US Banks at the Heart of FIFA Corruption Scandal
Major US financial institutions, including JPMorgan Chase, Bank of America, Citigroup and Delta Bank, were an intrinsic part of the two-decade-long scheme that saw FIFA officials receive over $150 million in bribes and kickbacks from sports executives, according to the 164-page indictment filed on May 20.
Other banks mentioned in the indictment include Swiss UBS AG, Julius Baer and British HSBC.
There they are again. Where ever there is corruption, one usually finds these outfits in the thick of it.
Currently, the banks are not accused of any wrongdoing.
Of course not…
Has the FIFA corruption crisis saved Israel from vote to expel it from world football?
One consequence of the US order to the Swiss police, on 27 May 2015, that it arrest and extradite seven FIFA officials for alleged corruption, could be that a vote to kick Israel out of world football for its racism towards Palestinians will now not take place. The vote was due to be held by the FIFA annual congress on 29 May and expected to win majority support among the delegates. Below Geoff Lee from Palestine Solidarity Campaign explains why the vote should go ahead.
THERE IS a unique situation in the Middle East: in that one country, Israel, is deliberately hindering another – Palestine – from playing football, and exhibits racism and discrimination against Palestinians within its own jurisdiction.
Due to this, Palestinians are demanding action which is perhaps slightly belated, but nonetheless, as urgent as ever. On 20 March 2015, the Palestinian Football Federation (PFA) submitted a motion for debate at the upcoming 28-29 May FIFA annual congress in Zurich. The motion calls for the suspension of the Israeli Football Federation (IFA) from FIFA until the following conditions are satisfied:
The article then continues listing the conditions and provides background about each of them. It’s fairly comprehensive about what the vote is about and what Israel has been doing that make their expulsion necessary.
A Saker started a thread about FIFA at /anglozionists-1-world-0-final-score/
I think that the comment about FIFA and the US summarily arresting the heads of it in a surprise move in order to stop it from evicting Israel from FIFA is 100% true.Furthermore this US last interference following hundreds of them formerly,means now the the Unites States is a formal genocidal world power.
It really does display how much power Israel has over the USA.
Israel owns the USA completely. The real and new name should be–
United States of Israel.
All of this is going to backfire on them as football is something the whole world other than the USA cares about. What fools. What Hubris, What nerve. Especially the Arab World that can put two and two together pretty quickly. If instead of arms those Arab coutries spent the money on the people all billions of them would be living a middle class lifestyle. Sounds like a few other countries I know of.
RR
This is excellent and yet another powerful tool for pushing back the awful influence of the mainstream media megaphone, which relentlessly trumpets this as all just ‘Russian aggression.’ Here in Canada, the prevalence of this view is widespread. All parliamentary parties are enthusiastic supporters of the US-backed puppet regime. Even the supposedly left-liberal, social democratic NDP opposition, cheerleads the fascist oligarchy in Kiev. With some far and few exceptions, Canadian ‘progressives’ appear to have fallen for the propaganda line as well. This is in no small part due to the power and influence of the Ukrainian ultranationalist lobby, the Ukrainian Canadian Congress and its links to the Atlantic Council. Hopefully more academics like Michael Hudson or Stephen Cohen will break their shameful complicitous silence and begin to talk truth and turkey on this critical and dangerous theater of imperialism. Thanks to Saker et al for this continuing superb resource of resistance!
Mr Gilberts…I’m a Canadian too.. your quote: , “…Canadian ‘progressives’ appear to have fallen for the propaganda line as well. This is in no small part due to the power and influence of the Ukrainian ultranationalist lobby, the Ukrainian Canadian Congress and its links to the …”
But its the Israel Lobby that is the really strong thing that’s wrong
Anyone who’d accuse Stephen Cohen of “shameful complicitous silence” hasn’t been reading / viewing much of Mr. Cohen. How would I know? Because I have been viewing / reading Mr. Cohen since Day One of the current Ukraine disaster. In fact, I’d like to post my very favorite quote from him thus far, but spare us except to paraphrase his words, “The road to US security runs through Moscow, period.”
Mr Gilberts, I am also Canadian. We might be organizing an event about Canada’s disturbing policy on Ukraine. Is there a way we can get in touch?
Informative report.
This news seems to point to the direction the junta will take, IE: perhaps a selective default on some debt, but not all of it.
Poroshenko Signs Moratorium on Foreign Debt Repayment
The Ukrainian parliament approved the bill, which could affect repayment of the country’s $3-billion debt to Russia on May 19.
Russian President Vladimir Putin said earlier the bill de facto was an announcement of a default, casting a negative light on the professionalism of Ukraine’s leadership.
Moreover, Russian Finance Minister Anton Siluanov said that Moscow would turn to an international court if the Ukrainian president signed a moratorium on the repayment of foreign debt.
Ukraine’s total debt is estimated at about $50 billion, of which $30 billion are external and $17 billion internal debts, according to Ukrainian Prime Minister Arseniy Yatsenyuk.
Yatsenyuk said that the suspension of payments could only relate to private loans, but Ukraine considered its $3-billion debt to Russia also as a private one, a position Moscow totally disagreed with.
Kiev has received several aid packages from international financial institutions, including the IMF, which has pledged to transfer $17.5 billion to the country over the next four years, with the first $5-billion installment being received.
Technically, there is no such thing as “selective” default. Once you default on one, the others will treat it as the next to be defaulted. It is against existing common rules for default anyways. That is to say, a country cannot say: Oh, I will just default against Russia (or USA, or China) for example.
alan
The way international banksters are getting to write their own rules, through the regimes they dominate, I wouldn’t be surprised if they came up with something like a selective default, but termed it something else – such as an “indefinite debt moratorium on x debt”. That’s sort of what I meant, that the junta was going to use other methods than officially default to effectively default on certain debts in cahoots with the international bankster cabal, who will continue to get paid.
on that point I have to agree with you! the Hegemon can just make new rules whenever and wherever – another way for them to show their Exceptionalism.
Technically – smechnically. We’ll be seeing lots of “selective defaults” in the coming years. The most egregious of these will be when the US “segregates” foreign held US Treasuries and Federal Reserve Notes to prevent them from coming home.
As for Odious Debt, a large percentage of sovereign debt worldwide arguably conforms to the definition. This is especially true of developing world’s debt, but even a substantial portion of GR’s debt harkens back to the military junta days. Indeed, should the US itself undergo a restoration of the Republic, it may too argue that much of its debt was “Odious” and repudiate it.
It can be called reneging. The technical terms is ‘screw out of’.
None of it matters if law isn’t upheld, and that depends on who has the power to enforce it. Also. technically known as ‘Whatcha gonna do about it?’, or on the street, “So sue me!”.
We know how far law goes in the US, and by proxy the UN, ICC, empire, etc. Might as well try to get delivery on a helicopter carrier or put a bankster in jail..
or Justice in many cases.
I first saw this article on Counterpunch, where yesterday there was another article I thought was relevant and well done:
Kiev’s Repression of Anti-fascism in Odessa
http://www.counterpunch.org/2015/05/27/kievs-repression-of-anti-fascism-in-odessa/
It goes into the abuses and repression of the Kiev government against journalists and, well, anyone trying to put forward any kind of political agenda that isn’t ethnic, fascist or pro-oligarch.
Oh, yeah–when I said “ethnic”, I meant driven by some sort of (semi-mythical?) Ukrainian ethnic identity politics. It seems it’s not just Russian speakers, all other groups are gonna get Ukrainified or run out.
I think Kiev is going to call the IMF bluff and will false flag their way to another summer offensive to try and somehow “win” in the east of Ukraine. The USA is never going to give up on it’s proxy war. Why should it? It’s not going to adversely any of those who orchestrated this mess, now will it?
Magnificent that Michael’s article is here. Even if not the ‘best’ economist he is certainly among the top (and among the MMT elite, which is the top school now), and adds to that an excellent historical perspective.
As for Q&A, I would like hear any comments he has on Russian economic policy and the new eastern and BRICS programs, and would love to hear what he thinks about Novorossia creating a new currency, based on MMT principles, and working to recover the economy there.
Yes Blue I would be interested to hear what Mr. Hudson thinks of Kharzin and Glaznyev economics.
Prof Hudson does a good job of providing the info needed for the real Ukrainians wanting to set their nation back on an even keel as to what status to put all IMF loans to the junta–Odious Junk. All that’s needed is for the workers in the Donbass to liberate their countyfellows. Too bad the level of infighting’s as deep as revealed by Colonel Cassad’s analysis of Mozgovoy’s murder.
Ukraine owes only about $50 billion.
All those bankrupt companies with “ancient non-European-standard” plant are worth nothing, so an be bought cheaply. But because the plant is “ancient” it can’t be old off as they do in normal asset stripping. There’s no assets there to strip, except maybe as scrap metal, and there’s not a big price for that anywhere, to be further lowered by dumping 100 billion tonnes of the stuff onto the market. So that is out.
The usual way to make money on such purchases is sell off the equipment (there isn’t any) then bring in a bit of new stuff (costs money) then sell the SHARES on a bubble basis, every early purchaser in it ONLY to sell off, in the latest little Ponzi. Each new buyer inflates the values and cuts costs by firing more workers, meanwhile borrowing a fortune for “development” (against the supposed value) most of which goes to directors’ consultancy companies. Eventually it goes broke, and gets bought out in a new round of Ponzi.
Except this being Ukraine, nobody will believe it will make a profit; they’ve heard too much about how hopeless the whole place is. Constant revolt and revolution and buildings being burned down.
Meanwhile the Government has to pay pensions and unemployment benefits to 80% of the nation. But they have no tax income to pay from, as the new “businesses” are not earning anything, and in any case do transfer pricing and bank offshore. They can’t borrow from IMF, as they can’t do any more austerity. They can’t increase taxes or reduce wages if already nobody is working. They can’t cut pensions and benefits when already half their population is being fed by international aid agencies…. or fleeing across the borders at 10,000 a day.
The would-be buyers can’t make a profit. And they can’t collect. So maybe they’d be overjoyed to sell off their debt at, say, 50% which is only $25 billion. Okay, $35.
That is easily put together by a couple of friendly nations which are prepared to wait a few years to get paid, and extend a small line of credit to buy imported raw goods for the few industries that need that. . For the rest, the country could print its own money, as it will only be used and spent internally, so no need for it to be “borrowed” from someone else.
Of course these benefactors would want a sensible government, so that is bye-bye to the current lot. Seeing them jailed might make the population happy to accept the new ones, whoever they are (especially if they come armed with loaves of bread).
Rebuild one “BRIC” at a time?
Well,it seems like a perfect place for Monsanto to buy up the prime agricultural lands for their GMO crops.Oh,wait,they are already doing that….them buggers!!!!!
Monsanto and Cargill too, I think. They are there in several strictly non-GMO countries. BUT they do other work as well. In fact the main reason GMO crops yield better is that they spend years breeding better varieties the plain old fashioned way. Then they GMO the best ones and give all the credit to GMO.
This involves a fair bit of space. Then they need to grow enough to have plenty of seed to sell (as farmers are not allowed to KEEP SEEDS for next year, if they buy from these big seed merchants). (They can tell, as they record and patent the DNA of “their” seeds).
But in a totally broke country there won’t be farmers wanting to buy seeds. Maybe just a few other huge agri-businesses. But where do they get people to work? nobody will work for starvation wages. If a few do, the other unemployed will picket the place. Then either they all go and steal the harvest (as they’re all starving) or they burn it down in revenge for the wages not being enough to live on. Then they employ armed security guards. But don’t pay them enough to shoot at their neighbours. They’ll just run the racket for bulk stealing of the harvest, to go on the black market. If they import foreign workers, those will keep turning up dead.
It’s a hard risky business in a totally lawless country full of people with nothing to lose (oh and don’t forget they all took their AK47s home). The only sales they’ll get is export, provided the trucks and trains don’t get ambushed, robbed or sabotaged. And fewer and fewer places want GMO enough to import it. China wants to import grain but they reject even tiny amounts of GMO contamination.
Yet another problem — currently they can LEASE the land for next to nothing; their only capital costs are the machinery. If Ukraine needs the money and has to SELL the land, suddenly the return on investment doesn’t look good.
“The main reason GMO crops yield better”–except they don’t. European non-GMO crops seem to give better yields than North American GMO ones.
http://www.counterpunch.org/2015/05/22/manufacturing-the-global-food-and-agricultural-crisis/
“Researchers at the University of Canterbury in New Zealand found that the GM strategy used in North American staple crop production is limiting yields and increasing pesticide use compared to non-GM farming in Western Europe. Led by Professor Jack Heinemann, the study’s findings were published in the June 2013 edition of the International Journal of Agricultural Sustainability. The research analysed data on agricultural productivity in North America and Western Europe over the last 50 years.
Heinemann’s team found that the combination of non-GM seed and management practices used by Western Europe is increasing corn yields faster than the use of the GM-led package chosen by the US. The research showed rapeseed (canola) yields increasing faster in Europe without GM than in the GM-led package chosen by Canada. What is more, the study found that Europe is decreasing chemical herbicide and achieving even larger declines in insecticide use without sacrificing yield gains, while chemical herbicide use in the US has increased with GM seed.”
Presumably the comparison was done Europe vs NA so as to get a fairly apples-to-apples result. It’s a very convenient contrast: Two wealthy first-world regions with well-developed agriculture, one basically banned GM crops while the other went big into them, what happened? Apparently, GM crops didn’t look so great.
A great book on Big Agra’s assault on humanity is Seeds of Destruction by William Engdahl. However horrifying you may think Monsanto et al are, cheer up, they’re much, much worse.
Kat Kan…I can’t agree with you there. I’m a gardener and mostly its perennials…like Lavenders…you just can’t get the good old English Lavenders anymore….nowadays all lavender plants are hybrid and they die in a couple of years…same story with all plants..veggies too.
There is no European standard to the East from there as well–a point Ukrainian eurointegration skeptics, aka separatists, were always making, telling that this will ‘destroy’ their manufacturing Some of those ancient companies can make some profit selling east; especially those currently well integrated, like Motor Sich. In consumer market, at present they will have to out-compete Chinese goods, not European.
So a Russia -friendly government may work even better than just a reasonable. In fact at present Russia remains their biggest trading partner (1/4 of the total), despite the war.
http://www.forbes.com/sites/markadomanis/2015/01/05/russia-is-still-ukraines-largest-trading-partner/
Alternative is paying them for everything (i.e giving them money knowing that they will default). Local Ponzi schemes are indeed less profitable over there. Asset stripping started 20 years ago and is likely near completion.
The east (Donbass etc) know they’re not on European standards. But they don’t care, because they hope and expect to continue trading with Russia and other places running Russian or Soviet technology. They can all slowly gradually upgrade if necessary.
Thing is, if they upgrade to “EU standards” they still wont’ sell anything, as there are already enough places making things to those standards. That is why the future is asset stripping, fake rebuilding to hold; up a Ponzi scheme. Donbass wants to keep the existing technology because they know that is where there jobs are.
And in fact they make things not many other places make, to any standards. Rockets. Huge pipes. Huge turbines. Specialist engines (short runs for rockets, helicopters, tanks… the kind that can’t be made in a 100,000 a year mass production factory). They used to have 3 serious aircraft factories (Antonov just moved out when the war started, the building and equipment is still there, and the skilled workers).
Even in consumer goods, Ukraine and Russia have the items that survive -40 degrees and can be fixed by the user in remote areas. Because they were engineered to work, not designed to look pretty. They could try selling into Canada.
Sorry Kat Kan, the repair requires spares that would not exist outside of the FSU. I love walking into a shop in Russia and buying a 39 Ruble part that saves me from throwing away a 2,500 Ruble machine. But you need the back-up suppliers.
Even in modern Russia, that is becoming more difficult, (though not impossible).
Interesting, thanks!
“The most effective tactic to tackle the corruption that is permitting the non-payment of wages and pensions is to focus on the present regime’s foreign support, especially from the IMF and EU. Using labor’s grievances as an umbrella to demand related reforms could include warnings that any sale of Ukrainian land, raw materials, public utilities or other assets to foreign buyers can be reversed by future, less corrupt governments.”
Absolutely, after all the reason given by Kiev to refuse to pay it’s debt now is very similar:
“To the public these funds have not reached. They were wasted in vain for the country . . . Government has the right to direct the funds paid by taxpayers in Ukraine to the needs of its citizens and not to return loans of the kleptocratic regime of Yanukovych.”
So far they’ve not been able to find what Yanukovich took or where he hid it. A lot of money stolen in the past went to other oligarchs, most of whom are still there and still in the Government. Poroshenko was on the board of the National Bank for 13 years (to 2012) and Yanukovich’s economic development minister for years, for heaven’s sake. Plenty of the missing money was stolen by others than Yanukovich.
“Odious debt” can be used in a case where, for example, a government borrows billions and uses most of it to buy bombs to use on their own citizens — which later get to be the new government expected to repay those loans.
Congratulations Saker…Michael Hudson is my favorite economist. He speaks such common sense, that a layperson like me can understand. And his attitude and demeanor is such a courageous and personable and honest integrity kind of guy. Thanks Michael !!! For being such a warrior of truth !!
well, here’s an proof for all the RC defense…
The Pinochet coup in Chile was a dress rehearsal for all this. The U.S.-backed military junta targeted labor leaders, journalists, and potential political leaders, as well as university professors (closing every economics department in Chile except for the Chicago “free market”-based Catholic University). You cannot have a “free market” Chicago-style, after all, without taking such totalitarian steps.
Glad to see you make such a statement about Hudson, Saker. He is certainly one of my favorite economists, though I wish I had read a lot more of his work. He has repeatedly introduced me to economic ideas I wasn’t previously familiar with (though admittedly I haven’t given the subject the attention it deserves). I find the MMT (Modern Monetary Theory) crowd, which Hudson is associated with, very inspiring at the moment. Fascinating stuff here, including some talks by Hudson:
English version, but intro. of first video is in Italian:
https://www.youtube.com/watch?v=MythvClDyzc&list=PLJx9xjCcQqLwjkc-jxpRYncN1b-Rno9zx
We are witnessing or participating in the very end of WW111. When Russia beat the Third Reich the United States was appalled. For them this was not supposed to happen.USA President Harry Truman, who was to atom bomb defeated Japan ordered General Eisenhower to begin the Cold War against Russia immediately. He did so, so effectively he was later made US President in gratitude.Since the tottering of the Ottoman Empire the British Parliament had decided Russia must be neutered of all her power so as to no longer pick up the best pieces of declining empires.1814, almost three hundred years ago. After WW1, Britain was enfeebled, exhausted, impoverished and she gave the anti-Russian plan to the US to act out.The subsequent redrawing of European borders looked ahead to another conflict needed by the US to gain more wealth, world standing.The ending rules of the WW1 winners so bankrupted Germany sure enough she did start WW11.The present lies of the US world leader all in effect reflect what they wanted to do with WW11, win it and erase Russia and own her! Except Russia won WW11 several times over losing about thirty million soldiers and civilians in the process. US 9/11/2001 was set up to remove all US law and to replace them with war state or police state, laws. Presently America operates under her own laws of whim, revenge and exceptionalism, generating genocidal wars that simply shatter countries so they are forever changed at the same time she deliberately destorys historical records of all kinds as do the US created ISIS troops! Coincidence?
Indeed, many thanks for this article, Saker. I also read it at counterpunch, but the advantage here is that comments can be made. I too very much appreciate Professor Hudson’s clarity on economic issues in these troubling times. And I look forward to your Q&A. It gives me hope when such educational essays can be distributed across a wider spectrum that it will percolate down to the public at large, which has been so fiendishly misled away from its own interests.
Blatter just resigned .. what do one make of that? Was he forced behind the scenes to do that? Maybe the US found some dirt on him and blackmailing him i don’t know but i am sad to hear this news. Does anyone have more information about this? Also, i am shocked how South African media is just supporting the western MSM’s version of the FIFA saga (i am South African) simply just publishing that version of the truth. There is absolutely no counter argument in our media that brings up the Palestine or Russian issue. Even in the daily local soapies and programmes they mention the corrupt Blatter the dictator etc influencing public opinion. It makes me angry to see how the people of my country just excepting the western narrative as the truth. Its absolutely astonishing. Discussing this with my fellow countryman you are made out as a conspiracy theorist .. a mad man to someone that don’t get taken seriously at the end of the day. To me it is obvious, its the algorythm of Zionist iron fist .. try to expose or isolate them next thing they destroy you. Thank God we still have the likes of Mr Putin, the star shall rise from the East and so i hope good will prevail for the sake of humanity.