Wednesday, February 29, 2012

Monday, February 27, 2012

Peter Matthews on IBRC payments

The last government agreed that the State should pay €31bn to IBRC (formerly Anglo and Irish Nationwide) over a 13-year schedule ending in 2025. The first payment of €3.1bn was made in March 2011. The next payment is due on March 31.

If the European Union and the European Central Bank force us to make this payment, it would amount to increasing the totally unjustified, odious debt burden on the people of Ireland .

How is it unjustified? How is it odious?

Loan losses that occurred in the Irish banks following the financial collapse in 2008 were calculated in March 2011 at €75bn. In the 12 months since then it is becoming increasingly apparent that mortgage loan losses will get progressively worse.

Evidence is mounting that the total loan losses in Ireland could rise towards €100bn.

Throughout 2008 and 2009 there was a slow motion run and controlled implosion of the Irish banking system. In response, the ECB advanced massive loans to the Irish banks and in turn the Central Bank of Ireland responded by providing Exceptional Liquidity Assistance (ELA) to the Irish banks.

Professors Karl Whelan, Brian Lucey and Dr Stephen Kinsella recently made excellent presentations to the Oireachtas Committee on the issue of the promissory notes and ELA.

They showed how the Central Bank of Ireland effectively created €45bn ELA money "out of thin air". The Central Bank of Ireland doesn't owe any of this money to the ECB, they said.

On a once-off basis, money was created and pumped into the Irish banks to keep them solvent.

When the Irish banks repay these ELA loans, the Central Bank of Ireland simply retires them. The money literally disappears.

Therefore, the €31bn ELA money created by the Central Bank of Ireland, and advanced to IBRC to cover promissory notes, can and should be written off.

Specifically, on March 31 next, the write-off by the Central Bank of Ireland of €3.1bn ELA would mean that the Government wouldn't have to borrow that money to pay the €3.1bn promissory note.

That promissory note could literally be torn up.

The same applies to all the remaining €25bn ELA loans to IBRC and the remaining €25bn promissory notes on IBRC's balance sheet.

There is nothing dubious or wrong about doing this.

Losses which should have been borne by bondholders have, wrongly, been dumped on the people of Ireland.

Normally, when banks collapse, their funders do not get all their money back. In Ireland, bondholders were redeemed all their money with interest at the insistence of the ECB.

Since the end of 2008, as payments to bondholders fell due, neither the banks nor the State had the resources to pay them.

That is where the ECB stepped in. It lent approximately €135bn to our banks to enable them to repay the bondholders and also to replace lost deposits.

The ECB became fully complicit in dumping this bill onto the people of Ireland.

Under normal capitalist principles, the ECB would not have shielded bond- holders from the consequences of their investments. They would have to accept that Ireland is "taking one for the team".

Taking all this into account, again under normal capitalist principles, the ECB could not object to writing off up to €75bn of the loans it advanced to the Irish banks.

If the ECB is unwilling to do this, then the Central Bank of Ireland should top up its Exceptional Liquidity Assistance loans to the Irish banks to €75bn (in the case of AIB and Bank of Ireland substituting ELA for ECB loans) and then write it off.

The ECB has a limited ability to prevent the Central Bank of Ireland from doing this. It can only veto a proposal by the Irish Central Bank with a two-thirds majority of its governing council.

There are 23 members of the governing council, including Ireland's representative, Governor Patrick Honohan.

So, if he and seven other members of the governing council support the proposal to write off the ELA money there is nothing Ms Merkel, Mr Sarkozy, Mr Draghi or anybody else can do about it.

But has Mr Honohan held discussions with ECB President Mario Draghi regarding writing off the ELA money? Has he lobbied other Central Bank governors? Has he lobbied the other eurozone countries in trouble so we can take a joint approach towards debt restructuring?

Writing off that €75bn would have a massive positive impact on Ireland.

Firstly, this would allow AIB and Bank of Ireland to pass on these write-downs to mortgage holders and struggling businesses, providing a much needed stimulus to the Irish economy.

Secondly, it would allow us to 'tear up' our obligation to redeem the €31bn promissory notes.

Overnight, our national debt would fall towards the Eurozone average and substantially improve our prospects of leaving the EU - IMF bailout programme.

We have been damned with faint praise from the troika. But the current EU policy of 'kicking the can down the road' just prolongs the crisis.

Our Government has shown willingness and fortitude in taking tough, necessary and often deeply unpopular decisions. It's now time for the ECB to establish fairness within the eurozone.

If the European political establishment really believes we're doing such a good job, the best way to show it is to agree to lighten the debt load on the people of Ireland by €75bn.

Peter Mathews is a chartered accountant and Fine Gael TD for Dublin South

- Peter Mathews

Sunday February 26

Friday, February 24, 2012

Haiti Solidarity Films and Actions

Haiti Solidarity Ireland

On Saturday 25th February we will be showing these films in the New Theatre, starting at 1 p.m.

Three Radharc Documentaries on Haiti

In 1991 the Radharc film crew made three documentary films for RTE on the situation in Haiti at the time of the election of Jean Bertrand Aristide. These include interviews with Aristide, scenes of the post-election celebrations, and demonstrations where people were killed by the army. Also interviewed are the then U.S. Ambassador, and journalist Maggie Steber who witnessed and survived an assassination attempt on Aristide.

“Priest, Prophet, President” 7/2/91 Asks how and why Aristide ended up as a presidential candidate, and the background to his political activity as a young priest working in a poor Haitian parish.

“Friends and Enemies of the President” 1/5/91 Looks at the support Aristide could rely on and the powerful enemies with whom he needed to negotiate.

“O La Liberté” 8/5/91 Examines the huge work that lay ahead of Aristide at the beginning of his presidency.

A Documentary by Kevin Pina, US journalist

"What's going on in Haiti?" Haiti in 2007 under US/UN Occupation

On Tuesday 28th February we will hold a public meeting in the Ireland institute 27 Pearse St. at 7.30 p.m.

Elsie Haas, a Haitian journalist, artist and film maker living in exile in Paris, has been campaigning for many years against the Duvalier dictatorship and its successors.

She will address the meeting on the developments in Haiti since the coup d'état of 2004 against Aristide, and how the UN occupation is facilitating the return of Duvalierism.

On Wednesday 29th February we will picket the Brazilian Embassy in Charlotte Way, off Camden St from 5.30 p.m. to 7.30 p.m.

This is in protest against Brazil's role in legitimising the coup d'état and managing the occupation forces known as MINUSTAH (United Nations' Mission for the Stabilisation of Haiti), and to demand an end to the occupation.

End the Occupation of Haiti!

Greek steelworkers statement

Statement of the trade union of the workers of “Helliniki Halivourgia”
(Greek Steelworks)

“The board of the trade union of the workers of “Helliniki Halivourgia” condemns the attempt of the fascist organisation “Chrisi Avgi” and other groups to provoke slander and discredit our heroic struggle.

“Crisi Avgi”, has been against our struggle since the beginning as it does in all workers’ and people’s struggles.

It defended the industrialist Manesis saying that his proposals for dismissals and a 5-hour workday were “reasonable under the difficult situation of the market”; that every company exists for this reason, to make profit.

Since the beginning, Chrisi Avgi accused our trade union of being “intransigent and lead by outsiders” that the trade union’s stance “leads the factory to closure”.

Chrisi Avgi tried to create a conflict between our colleagues from the factory of Volos and us, arguing that we strike because we have ensured high redundancy payments unlike our colleagues in Volos.

When they saw that this reactionary slander had no result, that the steelworkers continued proudly their struggle against Manesis and his class as a whole, that this struggle met the support of the working people in Greece, of workers from all over the world as well as of immigrant workers who work in Greece, they decided to use other underhand means to attack our struggle.

On the 109th day of strike, Chrisi Avgi suddenly visited the factory under the pretext of bringing material support. After taking photos of the pasta and the bottles of water they had brought, which were “decorated” with revolting pre-election slogans (which we saw after them leaving), and after them videotaping their presence, they played their well known role.

By means of various statements they started provoking our struggle, the board of the union and its leaders. At the same time, a few other groups used this as an opportunity to say openly, what they have been hiding for so long i.e. that they also utilize our strike to their interest, without agreeing with our struggle and its content.

We answer to all of them that they are too small, to criticize and slander the struggle of the steelworkers. The steelworkers are expressed through the decisions of their General Assemblies and the board of their union. These decisions reflect the class content and orientation of our struggle, our demands.

We reiterate that we ask for the solidarity of all workers. But we state clearly, once more, that the struggle of the steelworkers can neither be disoriented nor bought off, under the pretext of material support. Hundreds of trade unions, mass organizations and thousands of workers from Greece and the rest of the world have responded to our call since the beginning, organisations with which we have many different opinions, goals and directions.

We are aware that some do not offer material support in order to help, but they hope for other things. We state that the steelworkers are not for the teeth of Chrisi Avgi and other so called revolutionaries. The steelworkers are part of the organised class oriented movement that was and is the basic supporter of their struggle. It is no coincidence that all these groups attack PAME, inside and outside Greece, which PAME has been the basic supporter of our struggle and is now organising a campaign all over Greece for the financial support of our struggle. We call the steelworkers to isolate those who cause damage to our struggle. We say to Manesis and his people, that they fool themselves, if they believe that they will provoke and break the solidarity movement with our struggle. Provocations will not succeed.

We struggle for all Greece to become “Hallivourgia”

Details of the greek cuts and the KKE response

Τhe myths concerning the crisis and the response of the KKE and the class-oriented labour movement.

A life of hell for the working class, for all the people who toil is being prepared by the black front of the coalition government-Troika-plutocracy. Their agreement on the measures which have been announced is only the precursor for infinitely worse measures, which they will bring with their “new agreement” by June 2012.

The new memorandum of impoverishment which was voted on 12.2 includes amongst other the following measures:

Reduction of basic salaries by 22% (National General Collective Agreement-NGCA, sectoral and professional agreements). The basic salary for the newly hired workers will be further reduced by 10%, besides the 22% reduction i.e. a reduction of 32%. Abolition of sectoral bargaining agreements. Freezing of wages till 2015. Full time employment will be converted to part-time employment, upon the decision of the employers. Automatic wage increases based on seniority are suspended till unemployment falls below 10% , in fact they are abolished.

Collective bargaining agreements will last for maximum three years. All collective bargaining agreements which apply today will expire one year after the adoption of the new memorandum. Review of the new NGCA by the end of July in order to align with the basic salary in rival countries (Portugal, Turkey, Central and Southeastern Europe).

Abolition of one-sided recourse to arbitration.

Reduction of pensions by 300 millions euro annually. The new cuts will affect both basic and auxiliary pensions. Further cuts in basic pensions of several pension funds which will apply retrospectively from 1/1/2012.

Merging of all auxiliary pension funds by June 2012 and the beginning of s study “a sustainability factor that adjust benefits to promptly eliminate any future imbalances should they occur” which will lead to new cuts to auxiliary pensions as well as to retirement compensations.

2% reduction of the social contributions of the employers through the abolition of the contributions for the Workers’ Housing Organization and social benefits. The respective organizations will close down.

New reduction of the contributions that the employers pay for IKA (the biggest pension fund of private sector workers) from 1/1/2013 by 3%. Employees in public sector- Former state-owned enterprises- Banks. Abolition of permanent employment in former state-owned enterprises and banks and reduction of salaries New dismissals of 15.000 employees in public sector 2012, through “labour reserve”.

Reduction of employees in public sector, who work with temporary contracts, by means of not renewing contracts. Cuts of 636 million Euros on the salaries of the employees in public sector who are paid according to special wage scale by the end of July 2012.

New cuts on the salaries in public sector by means of revising the wage scales. Reduction of the number of public sector employees by 150,000 till 2015 and employment in line with the rule of 1recruitment for 5 exits. Reduction of the overall intake in academies (military, police) that guarantee automatic employment in public sector. Closure of public organizations and entities by June 2012

Reduction in the sector of healthcare and pharmaceutical spending by 1.1 billion Euros.

Cuts in a series of social benefits, by enacting criteria based on income. Reduction of benefits for families with more than 3 children. Reduction of operational and consumption spending of the state by 300 million Euros. Cuts on several entities supervised by the ministries of Education and Culture by 200 million Euros.

Reduction of expenditure on the overtime of doctors in hospitals by 50 million Euros.

Reduction of Public Investment Programmes by 400 million Euros. Reduction of expenditure on military equipment for the defense of the country. A new tax system in June 2012 which will abolish a series of tax breaks which have remained for sections of the workers. Larger tax exemptions for big capital.

The myths regarding the crisis must be rejected

This massacre of the working class-popular gains which are being implemented by the memorandum of 12/2/2012 as well as Memorandum 1 (2010) and the so-called Medium-term programme were not discovered now, they were clearly described from the Maastricht Treaty to the “Strategy for the Euro 2020” which were agreed on by all the governments in the EU before the crisis. The crisis is of the capitalist system itself and not of the debt as various bourgeois and opportunist claim. The capitalist crisis is the opportunity and pretext for the imposition of measures now which have been already scheduled and are necessary of the competitiveness and profitability of the European monopolies. These are reactionary measures which have as their urgent goal extremely cheap labour power and the mass eradication of small and medium-sized businesses. Without radical changes at the level of the economy and power, as long as the capitalist monopolies are dominant everywhere within the EU there cannot be a pro-people solution, as the opportunist forces, such as SYN/SYRIZA and the forces of the “European Left Party”(ELP). The various so-called pro-people funds, the utopian humanization of the ECB, the various loans which will again be paid for by the people either through Eurobonds or through renegotiation which is proposed by the ELP or through the separation of the debt into allegedly moral and odious debt which again means that the people will pay.

Such management proposals serve capitalist profitability and incriminate the people, so they must be rejected.

The response of the KKE and the class-oriented labour movement

The responsibility now lies with the people. It is necessary for the worst to be prevented. For this to be realized, the basic direction of the people’s movement must be the overthrow of capitalism. The only way out is the working class popular power with disengagement from the EU and unilateral cancellation of the debt. There is no other solution for the people.In this course of intensifying class struggle, the overthrow of the government and elections will be a link in the class struggle and beneficial for the people, provided that they use it as a weapon to cause an even greater rupture in the political system. Now the question for the people and every worker, for the unemployed, the self-employed, the poor farmers, for young people and women who belong to the popular strata, for every individual is not just their liberation from the parties of the plutocracy, but their support for the KKE. In this way will the rupture be substantial.

Any other political choice does not frighten them, does not make life difficult for them, but facilitates a political solution which will come in succession so that the massacre of the people can be implemented. It will facilitate the promotion of new reserves for the bourgeois political system, possibly of new parties or party alliances, which will seek the most effective deception and subjugation of the people. Only the alliance with the KKE can serve the people’s interests, because a pro-people political line can exist only in people’s power. But this is not enough; today workers must not consider themselves merely as voters. They must be active, contribute to the unions on a daily basis, to the struggle committees in the workplaces, to the people’s committees concerning every problem of the people so that the anti-people offensive meets a practical answer till the final confrontation for power.

Bailout = Austerity Public Meeting

Saturday 31st March 2 pm Ireland Institute
Prof. Kathleen Lynch
Dr Conor McCabe
Gen. Sec. John Douglas

Sunday, February 12, 2012

Blueprint for a Syria takeover

by Felicity Arbuthnot writing in the Morning Star

For anyone in two minds about what is really going on in Syria, here is a salutary tale from modern history. Recently discovered US-British government papers, which have since been omitted from even BBC timelines on Syria, have sinister echoes of current sabre-rattling.

In late 2003, the year of the Iraq invasion, Royal Holloway University historian Matthew Jones discovered some “frighteningly frank” documents – the 1957 agreement between prime minister Harold Macmillan and president Dwight Eisenhower endorsing “a CIA-MI6 plan to stage fake border incidents as an excuse for an invasion (of Syria) by Syria’s pro-Western neighbours.”

At the heart of the plan was the assassination of the perceived power behind then president Shukri al-Quwatli.

Also targeted were head of military intelligence Abd al-Hamid Sarraj, chief of Syrian general staff Afif al-Bizri and Khalid Bakdash, the general secretary of the Syrian Communist Party and first ever communist to be elected to an Arab parliament.

The document was drawn up in Washington in September 1957.

“In order to facilitate the action of liberative (sic) forces, reduce the capabilities of the regime to organise and direct its military actions … to bring about the desired results in the shortest possible time a special effort should be made to eliminate certain key individuals,” it says.

“Their removal should be accomplished early in the course of the uprising and intervention and in the light of circumstances existing at the time.”

In the light of President Bashir Assad’s allegations of intervention and cross-border incursions by foreign forces some of the plans’ phraseology is fascinating.

“Once a political decision has been reached to proceed with internal disturbances in Syria, CIA is prepared and (with) SIS (MI6) will attempt to mount minor sabotage and coup de main (sic) incidents within Syria working through contacts with individuals.

“Incidents should not be concentrated in Damascus … care should be taken to avoid causing key leaders of the Syrian regime to take additional personal protection measures.”

It further states that a “necessary degree of fear … frontier incidents and (staged) border clashes,” would “provide a pretext for intervention,” by Iraq and Jordan – then still under British mandate.

Syria was to be “made to appear as sponsor of plots, sabotage and violence directed against neighbouring governments … the CIA and SIS should use … capabilities in both psychological and action fields to augment tension.”

Incursions into Iraq, Jordan and Lebanon involving “sabotage, national conspiracies, and various strong-arms activities” were to be blamed on Damascus, the document advised.

In late December 2011 an opposition Syrian National Council was announced with a plan to “liberate the country.” Its representatives met Hillary Clinton. There now seems to be a US-endorsed Syrian Higher Revolutionary Council.

There are all-too-clear parallels with the Eisenhower-Macmillan plan to fund a Free Syria Committee with the “arming of political factions with paramilitary or other actionist capabilities” within Syria.

The CIA and MI6 planned to foment internal uprisings and replace the Ba’ath Communist-leaning government with a Western-friendly one.

Expecting this to be met by public hostility the plan anticipated that their agents would “Probably need to rely first on repressive measures and arbitrary exercise of power.”

The document was signed off in both London and Washington. Macmillan wrote in his diary of “a most formidable report” which was “withheld even from British chiefs of staff.”

Washington and Whitehall had become concerned at Syria’s increasingly pro-Soviet, rather than pro-Western, sympathies and they disliked the pan-Arab Ba’ath and Communist Party alliance, which was also widely supported by the Syrian army.

These political concerns were augmented by Syria’s control of a main pipeline from Iraq’s western oilfields in those pre-Saddam Hussein days.

Briefly put, in 1957 Syria allied itself with Moscow by signing an agreement on military and economic aid. The previous year it had recognised the People’s Republic of China.

The Soviet Union, as Russia has done now, warned the West against intervening in Syria.

Syria remains unchanged as a country valuing its sovereignty and the historical loyalties remain.

In 1957 this independent-mindedness caused senior State Department official Loy Henderson to say that “the present regime in Syria had to go.”

Ultimately the plan was not put into action since, British mandate or not, neighbouring countries refused to be part of it.

In a tone similar to that of 1957, Britain’s Foreign Secretary William Hague has said President Assad “will feel emboldened” by Russia’s and China’s voting against the US and Britain-drafted resolution at the UN.

Clinton has called for “friends of a democratic Syria” to unite and rally against the Assad government.

“We need to work together to send them a clear message – you cannot hold back the future at the point of a gun,” she said.

The Russia-China veto at the UN has been condemned by the US varyingly as “disgusting,” “shameful,” “deplorable” and “a travesty.” Jaw-dropping and embarrassing double standards.

Perhaps the bottom line is that in 1957 Iraq’s oil, to which Syria held an important key, was at the top of the Western agenda. Today it is Iran’s – and, as Canadian academic Michel Chossudovsky notes so succinctly, “The road to Tehran is through Damascus.”

If Not Alarmed, Pay Attention by Joe Jamison

If Not Alarmed, Pay Attention

by Joe Jamison

A gigantic political-economic crisis is gripping Europe. It is hammering Ireland and other small states on the “periphery” of Europe: Greece and Portugal, and -- though not “small and peripheral” -- Italy and Spain.

Yet, so far, in Irish America, one detects almost no recognition of the scale, nature, and novelty of the disaster engulfing Ireland.

What just happened to Greece and Italy could happen to Ireland, and soon. In an action many described as tantamount to a coup d’état, a few weeks ago German Chancellor Merkel ousted elected Italian and Greek leaders. She parachuted into power two unelected banker-technocrats. The new Italian Prime Minister, Mario Monti, was an official of Goldman Sachs. The new Greek Prime Minister, Lucas Papademos, worked for the European Central Bank.

In 1941, an earlier German Chancellor required fifteen divisions to install a collaborationist Greek government. Today, despite the Greek people’s magnificent fight back against austerity, Chancellor Merkel did the same -- with a few phone calls.

The very interests in Ireland that have brought the country to its knees want to keep up the semblance of normality. Unlike in the days of the peace process there will be no “Pan-Nationalist Front” now. Grassroots forces in Ireland and Irish-America will have no allies in the government parties, nor in the senior civil service.

This week, in the run up to March 17, there will be a normal trip by a Taoiseach to the US for his normal round of Washington business and government meetings. He will express confidence in his government’s course and appeal for investment and tourism. The Embassy staff will complete plans for the light-hearted, traditional Shamrock Ceremony at the White House next month. All is well.

Except for the fact that all isn’t well.

A crisis always exposes the real power relations. It lifts the rhetorical fog.

In its latest proposal for the Eurozone, Germany wants Greece to yield sovereignty over tax and spending decisions to a Eurozone 'Budget Commissioner’ to secure a second €130 bailout. According to the Financial Times,

"In what would amount to an extraordinary extension of European Union control over a member state, the new commissioner would have the power to veto budget decisions taken by the Greek government if they were not in line with targets set by international lenders.

"The new administrator, appointed by other Eurozone finance ministers, would have responsibility for overseeing 'all major blocks of expenditure' by the Greek government....

This crisis is not normal for other reasons.

The crisis has far to go. The measures the European elites are imposing on the peoples of Europe are bound to deepen the depression, setting in motion political upheavals of all kinds.

Having already surrendered the powers of an independent state, step by step, treaty after treaty, for decades, the Irish government announced it will commit a final act of folly and accede to the Treaty for Fiscal Stability. Like Greece and Italy, Ireland will be at the mercy of German banks.

It gets worse. The Irish Times has disclosed the Fiscal Stability Treaty favored by the Irish government was specifically designed to avoid a referendum in Ireland.

The masters of Europe learn. They know that, since 1987, democrats in Ireland have been able to compel a referendum on eurotreaties. They know Ireland is a key arena of the fight between democratic and plutocratic Europe.

This is no normal recession and normal upsurge in immigration. This is no normal right-of-center government imposing budget cuts in public services and bestowing tax cuts on the rich and the corporations.

The unreal tranquility is also rooted in the notion that we are in the aftermath of the great storm, the four decades in the Six Counties before 2007. There is “a settlement.” Our job is to help to implement the Good Friday Agreement. In the North, democratic change and demographic change, or both together, will sooner or later move the needle. There may be a referendum on reunification by 2016.

One unspoken assumption of this outlook is that there would be an independent, healthy, reasonably prosperous 26-county state for the Six Counties to reunite with. That assumption, I believe, is now in question.

Some far-seeing observers in Ireland blurted out the inconvenient truth. Democrats and patriots – left, right, and center -- insisted for decades on the absurdity of Ireland handing over ever more power to unelected officials in a Brussels bureaucracy dominated by German and French big business.

But, the march of folly continued. In treaty after treaty the Irish state surrendered essential economic powers -- such as its own currency and control over its exchange rate.

Sometimes Irish voters did listen to the dissenters and voted a treaty down. When they did so, Irish elites, goaded by Brussels, re-ran the referendum to get the desired result.

In Europe, a mood is in the air like nothing we have seen in our lifetimes.

Democracy in Europe is being extinguished by a Germany acting on the crazed priorities of German high finance

The elites who presided over the crash and slump in Europe and who profited from the boom that preceded it show no remorse in their drive to make little people bear the full cost.

This will worsen the coming downturn.

At Davos, Switzerland a few days ago, these self-assured elites left little doubt where they stand. There is no jobs crisis; there is only a crisis of investor confidence. Regardless, any crisis has nothing to do with us. Things can be patched up by slashing the social safety net.

In Davos, the Great and the Good chose to party on. The Titanic steams toward the iceberg.

Public opinion in the Twenty Six Counties may be awakening. In the mainstream Irish media, sober commentators with a sense of history glimpse the march toward the abyss. They urge a change in course. Academic and other non-party political leaders of civil society are writing open letters in the Irish Times appealing for, at least, a policy of expansion, not austerity.

Now, it is time for us in Irish America to wake up.

This is the first of a two-part opinion essay by Joe Jamison, president of the Irish-American Labor Coalition. He writes in a personal capacity.Irish Echo, NY Wed. Feb. 8, 2012

SV February edition

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Monday, February 6, 2012

The Money Masters: Behind the global debt crisis

The Money Masters: Behind the global debt crisis

Taken from

In the US, we see untold millions suffering from the impact of mass foreclosures and unemployment; in Greece, Spain, Portugal, Ireland, and Italy, stringent austerity measures are imposed upon the whole population; all coupled with major banking collapses in Iceland, the UK and the US, and indecent bail-outs of “too-big-to-fail” bankers (Newspeak for too powerful to fail).

No doubt, the bulk of the responsibility for these debacles falls squarely on the shoulders of caretaker governments in these countries that are subordinated to Money Power interests and objectives. In country after country, that comes together with embedded corruption, particularly evident today in the UK, Italy and the US.

As we assess some of the key components of today’s Global Financial, Currency and Banking Model in this article, readers will hopefully get a better understanding as to why we are all in such a crisis, and that it will tend to get much worse in the months and years to come.

Foundations of a Failed and False Model

Hiding behind the mask of false “laws” allegedly governing “globalised markets and economies,” this Financial Model has allowed a small group of people to amass and wield huge and overwhelming power over markets, corporations, industries, governments and the global media. The irresponsible and criminal consequences of their actions are now clear for all to see.

The “Model” we will briefly describe, falls within the framework of a much vaster Global Power System that is grossly unjust and was conceived and designed from the lofty heights of private geopolitical and geo-economic1 planning centres that function to promote the Global Power Elite’s agenda as they prepare their “New World Order” – again, Newspeak for a Coming World Government.2

Specifically, we are talking about key think tanks like the Council on Foreign Relations, the Trilateral Commission, the Bilderberg Group, and other similar entities such as the Cato Institute (Monetary Issues), American Enterprise Institute and the Project for a New American Century that conform an intricate, solid, tight and very powerful network, engineering and managing New World Order interests, goals and objectives.

Writing from the stance of an Argentine citizen, I admit we have some “advantages” over the citizens of industrialised countries as the US, UK, European Union, Japan or Australia, in that over the last few decades we have had direct experience of successive catastrophic national crises emanating from inflation, hyper-inflation, systemic banking collapse, currency revamps, sovereign debt bond mega-swaps, military coups and lost wars…

Finance vs the Economy

The Financial system (i.e., a basically unreal Virtual, symbolic and parasitic world), increasingly functions in a direction that is contrary to the interest of the Real Economy (i.e., the Real and concrete world of work, production, manufacturing, creativity, toil, effort and sacrifice done by real people). Over the past decades, Finance and the Economy have gone their totally separate and antagonistic ways, and no longer function in a healthy and balanced relationship that prioritises the Common Good of We the People. This huge conflict between the two can be seen, amongst other places, in today’s Financial and Economic System, whose main support lies in the Debt Paradigm, i.e., that nothing can be done unless you first have credit, financing and loans to do it. Thus, the Real Economy becomes dependent on and distorted by the objectives, interests and fluctuations of Virtual Finance.3

Debt-Based System

The Real Economy should be financed with genuine funds; however with time, the Global Banking Elite succeeded in getting one Sovereign Nation-State after another to give up its inalienable function of supplying the correct quantity of National Currency as the primary financial instrument to finance the Real Economy. That requires decided action through Policies centred on promoting the Common Good of We The People in each country, and securing the National Interest against the perils posed by internal and external adversaries.

Thus, we can better understand why the financial “law” that requires central banks to always be totally “independent” of Government and the State has become a veritable dogma. This is just another way of ensuring that central banking should always be fully subordinated to the interests of the private banking over-world – both locally in each country, as well as globally.

We find this to prevail in all countries: Argentina, Brazil, Japan, Mexico, the European Union and in just about every other country that adopts so-called “Western” financial practice. Perhaps the best (or rather, the worst) example of this is the United States where the Federal Reserve System is a privately controlled institution outright, with around 97% of its shares being owned by the member banks themselves (admittedly, it does have a very special stock scheme), even though the bankers running “Fed” do everything they can to make it appear as if it is a “public” entity operated by Government, something that it is definitely not.

One of the Global Banking Over-world’s permanent goals is – and has been – to maintain full control over all central banks in just about every country, in order to be able to control their public currencies.4 This, in turn, allows them to impose a fundamental (for them) condition whereby there is never the right quantity of public currency to satisfy the true demand and needs of the Real Economy. That is when those very same private banks that control central banking come on scene to “satisfy the demand for money” of the Real Economy by artificially generating private bank money out of nothing. They call it “credits and loans” and offer to supply it to the Real Economy, but with an “added value” (for them): (a) they will charge interest for them (often at usury levels) and, (b) they will create most of that private bank money out of thin air through the fractional lending system.

At a Geo-economic level, this has also served to generate huge and unnecessary public sovereign debts in country after country all over the world. Argentina is a good example, whose Caretaker Governments are systematically ignorant and unwilling to use one of the sovereign state’s key powers: the issuance ofhigh power non-interest generating Public Money (see below for a more detailed definition). Instead, Argentina has allowed IMF (International Monetary Fund) so-called “recipes” that reflect the global banking cartel’s own interests to be imposed upon it in fundamental matters like what are the proper functions of its Central Bank, sovereign debt, fiscal policy, and other monetary, banking and financial mechanisms, that are thus systematically used against the Common Good of the Argentine People andagainst the National Interest of the country.

This system and its dreadful results, now and in the past, are so similar in so many other countries –Brazil, Mexico, Greece, Ireland, Iceland, UK, Portugal, Spain, Italy, Indonesia, Hungary, Russia, Ukraine… that it can only reflect a well thought-out and engineered plan, emanating from the highest planning echelons of the Global Power Elite.

Fractional Bank Lending

This banking concept is in use throughout the world’s financial markets, and allows private banks to generate “virtual” Money out of thin air (i.e., scriptural annotations and electronic entries into current and savings accounts, and a vast array of lines of credit), in a ratio that is 8, 10, 30, 50 times or more largerthan the actual amount of cash (i.e., public money) held by the bank in its vaults. In exchange for lending this private “money” created out of nothing, bankers collect interest, demand collateral with intrinsic value and if the debtor defaults they can then foreclose on their property or other assets.

The ratio that exists between the amount of Dollars or Pesos in its vaults and the amount of credit private banks generate is determined by the central banking authority which fixes the fractional lending leverage level (which is why controlling the central bank is so vital strategically for private banker cartels). This leverage level is a statistical reserve based on actuarial calculations of the portion of account holders who in normal time go to their banks or ATM machines to withdraw their money in cash (i.e., in public money notes). The key factor here is that this works fine in “normal” times, however “normal” is basically acollective psychology concept intimately linked to what those account holders, and the population at large, perceive regarding the financial system in general and each bank in particular.

So, when for whatever reason, “abnormal” times hit – i.e., every time there are (subtly predictable) periodic crises, bank runs, collapses and panics, which seem to suddenly explode as happened in Argentina in 2001 and as is now happening in the US, UK, Ireland, Greece, Iceland, Portugal, Spain, Italy and a growing number of countries – we see all bank account holders running to their banks to try to get their money out in cash. That’s when they discover that there is not enough cash in their banks to pay, save for a small fraction of account holders (usually insiders “in the know” or “friends of the bankers”).

For the rest of us mortals “there is no more money left,” which means that they must resort to whatever public insurance scheme may or may not be in place (e.g., in the US, the state-owned Federal Deposit Insurance Corporation that “insures” up to US$250,000 per account holder with taxpayer money). In countries like Argentina, however, there is no other option but to go out on the streets banging pots and pans against those ominous, solid and firmly closed bronze bank gates and doors. All thanks to the fraudulent fractional bank lending system.

Investment Banking

In the US, so called “Commercial Banks” are those that have large portfolios of checking, savings and fixed deposit accounts for people and companies (e.g., such main street names as CitiBank, Bank of America, JPMorganChase, etc.; in Argentina, we have Standard Bank, BBVA, Galicia, HSBC and others). Commercial Banks operate with fractional lending leverage levels that allow them to lend out “virtual” dollars or pesos for amounts equal to 6, 8 or 10 times the cash actually held in their vaults; these banks are usually more closely supervised by the local monetary authorities of the country.

A different story, however, we had in the US (and still have elsewhere) with so-called global “Investment Banks” (those that make the mega-loans to corporations, major clients and sovereign states), over which there is much less control, so that their leveraging fractional lending ratios are far, far higher. This greater flexibility is what allowed investment banks in the US to “make loans” by, for example, creating out of thin air 26 “virtual” Dollars for every real Dollar in cash they held in their vaults (i.e., Goldman Sachs), or 30 virtual Dollars (Morgan Stanley), or more than 60 virtual Dollars (Merrill Lynch until just before it folded on 15 Sept 2008), or more than 100 virtual Dollars in the cases of collapsed banks Bear Stearns and Lehman Brothers.5

Private Money vs Public Money

At this point in our review, it is essential to very clearly distinguish between two types of Money or Currency:

Private Money – This is “Virtual” Money created out of thin air by the private banking system. It generates interests on loans, which increases the amount of Private money in (electronic) circulation, and spreads and expands throughout the entire economy. We then perceive this as “inflation.” In actual fact, the main cause of inflation in the economy is structural to the interest-bearing fractional lending banking system,even among industrialised countries. The cause of inflation nowadays is not so much the excessive issuance of Public Money by Government as all so-called banking experts would have us believe but, rather, the combined effect of fractional lending and interest on private banking money.

Public Money – This is the only Real Money there is. It is the actual notes issued by the national currency entity holding a monopoly (i.e., the central bank or some such government agency) and, as Public Money, it does not generate interest, and should not be created by anyone other than the State. Anybody else doing this is a counterfeiter and should end up in jail because counterfeiting Public Money is equivalent to robbing the Real Economy (i.e., “we, the working people”) of their work, toil and production capabilities without contributing anything in return in terms of socially productive work. The same should apply to private bankers under the present fractional lending system: counterfeiting money (i.e., creating it out of thin air as a ledger entry or electronic blip on a computer screen) is equivalent to robbing the Real Economy of its work and production capacity without contributing any counter-value in terms of work.

Why We Have Financial Crises

A fundamental concept that lies at the very heart of the present Financial Model can be found in the wayhuge parasitic profits on the one hand, and catastrophic systemic losses on the other, are effectively transferred to specific sectors of the economy, throughout the entire system, beyond borders and public control.

As with all models, the one we suffer today has its own internal logic which, once properly understood, makes that model predictable. The people who designed it know full well that it is governed by grand cycles having specific expansion and contraction stages, and specific timelines. Thus, they can ensure that in bull market times of growth and gigantic profits (i.e., whilst the system, grows and grows, is relatively stable and generates tons of money out of nothing), all profits are privatised making them flow towards specific institutions, economic sectors, shareholders, speculators, CEO and top management & trader bonuses, “investors”, etc who operate the gears and maintain the whole system properly tuned and working.

However, they also know that – like all roller coaster rides – when you reach the very top, the system turns into a bear market that destabilises, spins out of control, contracts and irremediably collapses, as happened to Argentina in 2001 and to the better part of the world since 2008, then all losses are socialised by making Governments absorb them through the most varied transference mechanisms that dump these huge losses onto the population at large (whether in the form of generalised inflation, catastrophic hyperinflation, banking collapses, bail-outs, tax hikes, debt defaults, forced nationalisations, extreme austerity measures, etc).

The Four-sided Global “Ponzi” Pyramid Scheme

As we know, all good pyramids have four sides, and since the Global Financial System is based on a “Ponzi” Pyramid Scheme, there’s no reason why this particular pyramid should not have four sides as well.

Below is a summary of the Four-side Global “Ponzi” Pyramid Scheme that lies at the core of today’s Financial Model, indicating how these four “sides” function in a coordinated, consistent, and sequential manner.

Side One – Create Public Money Insufficiency. This is achieved, as we explained above, by controlling the National Public entity that issues public money. Its goal is to demonetise the Real Economy so that the latter is forced to seek “alternative funding” for its needs (i.e., so that it has no choice but to resort to private bank loans).

Side Two – Impose Private Banking Fractional Lending Loans. This, as we said, is virtual private money created out of thin air on which bankers charge interest – often at usury levels – thus generating enormous profit for “investors,” creditors and all sorts of entities and individuals who operate as parasites living off other people’s work. This would never have been the case if each local central bank were to flexibly generate the correct quantity of Public Money necessary to satisfy the needs of the Real Economy in each country and region.

Side Three – Promote a Debt-Based Economic System. In fact, the whole Pyramid Model is based on being able to promote this generalised paradigm that falsely states that what really “moves” the private and public economy is not so much work, creativity, toil and effort of workers, but rather “private investors,” “bank loans” and “credit” – i.e., indebtedness. With time, this paradigm has replaced the infinitely wiser, sounder, more balanced and solid concept of corporate profit being reinvested and genuine personal savings being the foundation for future prosperity and security. Pretty much the way Henry Ford, Sr. originally grew his most successful company.

Today, however, Debt reigns supreme and this paradigm has become entrenched and embedded into people’s minds thanks to the mainstream media and specialised journals and publications, combined with Ivy League universities’ Economics Departments that have all succeeded in imposing such “politically correct” thinking with respect to financial matters, especially those relating to the proper nature and function of Public Money.

The facts are that this Model generates unnecessary loans so that banking creditors can receive huge profits, which includes promoting uncontrolled, unwarranted and often pathological consumerism, which goes hand in hand with the increasing abandonment of the traditional value of “saving for a rainy day.”

Such debts having political and strategic goals rather than merely financial ones, are usually given a thin layer of “legality” so that they may be imposed by the creditor on the debtor (i.e., in the case of The Merchant of Venice, the bond entered into between Antonio and Shylock giving the latter the legal right to a pound of the former’s flesh; in the case of chronically indebted countries like Argentina, such “legality” is achieved through a complex public debt laundering6 mechanism carried out by successive formally “democratic” Caretaker Governments to this very day).

Side Four – Privatisation of Profits/Socialisation of Losses. Lastly, and knowing full well that, in the long run, the numbers of the entire Cycle of this Model never add up, and that the whole system will inevitably come crashing down, the Model imposes a highly complex and often subtle financial, legal and media engineering that allows privatising profits and socialising losses. In Argentina, this cycle has become increasingly visible for those who want to see it, because in our country the local “Ponzi” Pyramid Cycle lasts on average 15 to 17 years, i.e., we’ve had successive collapses involving brutal devaluation (1975), hyperinflation (1989) and systemic banking collapse (2001), however in the industrialised world, that cycle was made to last almost 80 years (i.e., three generations spanning from 1929 to 2008).


The fundamental cause of today’s on-going global financial collapse that exerts massive distortions over the Real Economy – and the ensuing social hardship, suffering and violence – is clear: Virtual Finance has usurped a pedestal of supremacy over the Real Economy, which does not legitimately belong to it.Finance must always be subordinated to, and in the service of, the Real Economy just as the Economy must heed the law and social needs of the Political Model executed by a Sovereign Nation-State (as we back-engineer this entire system, we thus understand why it is necessary for the Global Power Elite to first erode the sovereign Nation-State and to eventually do away with it altogether, in order to achieve its monetary, financial and political ends).

In fact, if we look at matters in their proper perspective, we will see that most national economies are pretty much intact, in spite of having been badly bruised by the financial collapse. It is Finance that is in the midst of a massive global collapse, as this Model of “Ponzi” Finance has grown into a sort of malignant “cancerous tumour” that has now “metastasised,” threatening to kill the whole economy and social body politic, in just about every country in the world, and certainly in the industrialised countries.

The above comparison of today’s financial system with a malignant tumour is more than a mere metaphor. If we look at the figures, we will immediately be able to see signs of this financial “metastasis.” For example, The New York Times in their 22 September 2008 edition explains that the main trigger of the financial collapse that had exploded just one week earlier on 15 September was, as we all know, mismanagement and lack of supervision over the “Derivatives” market. The Times then went on to explain that twenty years earlier, in 1988, there was no derivatives market; by 2002 however, Derivatives had grown into a global 102 trillion Dollar market (that’s 50% more than the Gross Domestic Product of all the countries in the world, the US, EU, Japan and BRICS nations included), and by September 2008, Derivatives had ballooned into a global 531 trillion Dollar market. That’s eight times the GDP of the entire planet! “Financial Metastasis” at its very worst. Since then, some have estimated this Derivatives global market figure to be in the region of One-Quadrillion Dollars…

Naturally, when that collapse began, the caretaker governments in the US, European Union and elsewhere, immediately sprang into action and implemented “Operation Bail-out” of all the mega-banks, insurance companies, stock exchanges and speculation markets, and their respective operators, controllers and “friends.” Thus, trillions upon trillions of Dollars, Euros and Pounds were given to Goldman Sachs, Citicorp, Morgan Stanley, AIG, HSBC and other “too big to fail” financial institutions… which is newspeak for “too powerful to fail”, because they hold politicians, political parties and governments in their steel grip.

All of this was paid with taxpayer dollars or, even worse, with uncontrolled and irresponsible issuance of Public Money bank notes and treasury bonds, especially by the Federal Reserve Bank which has, in practice, technically hyper-inflated the US Dollar: “Quantitative Easing” they call it, which is Newspeak forhyperinflation.

So far, however, like the proverbial Naked Emperor, nobody dares to state this openly. At least not until some “uncontrolled” event triggers or unmasks what should by now be obvious to all: Emperor Dollar is totally and completely naked.7 When that happens, we will then see bloody social and civil wars throughout the world and not just in Greece and Argentina.

By then, however, and as always happens, the powerful bankster clique and their well-paid financial and media operators, will be watching the whole hellish spectacle perched in the safety and comfort of their plush boardrooms atop the skyscrapers of New York, London, Frankfurt, Buenos Aires and Sao Paulo…


1. The concept of “Geoeconomics” was coined by the New York-based Council on Foreign Relations, through a studies group honouring Maurice Greenberg, the financier who was for decades CEO of American International Group (AIG) which collapsed in 2008 and had strong conflict-of-interest ties with major insurance and reinsurance broker Marsh Group whose CEO was his son Jeffrey. Both father and son were indicted for fraud by then New York Attorney General Elliot Spitzer. Spitzer would later pay a very heavy price for this after becoming Governor of New York State when someone “discovered” his sex escapades which were quickly blown up into a major scandal by The New York Times…

2. We have described the basic Global Power Elite structure, model and objectives in our e-Book The Coming World Government: Tragedy & Hope?, available through

3. For more information, see the Third Pillar of the Second Republic Project “Reject the Debt-Based Economy” on

4. Some notable exceptions: Today: Libya, Iran, Syria, China; In the past: Peron’s Argentina, Germany and Italy in the 30’s and 40’s…. Are we seeing a pattern here?

5. See The New York Times, 22 September 2008

6. See White Paper comparing Debt Laundering mechanisms to Money Laundering mechanisms, lodged under Pillar No 3 “Reject the Debt-Based Economy” of Second Republic Project

7. This is more fully described in the author’s book

Adrian Salbuchi is a political analyst, author, speaker and radio talk-show host in Argentina. He has published several books on geopolitics and economics in Spanish, and recently published his first eBook in English: The Coming World Government: Tragedy & Hope? which can be ordered through his web site, or details can be requested by E-mail to Salbuchi also works as strategic consultant for domestic and international companies. He is also founder of the Second Republic Project in Argentina, which is expanding internationally (visit:

The above article appeared in New Dawn No. 128 (September-October 2011).

Adrian Salbuchi is a frequent contributor to Global Research. Global Research Articles by Adrian Salbuchi

People's News Issue 63

People's News Issue 63:

The EU fanatics have come to such a policy dead end that they really no longer care what happens to the country.

It would be an affront to what is left of our national democracy and political independence if the Government attempts to ratify the “Treaty on Stability, Coordination and Governance in the Economic and Monetary Union”—or, more accurately, the Permanent Austerity Treaty—without a referendum.

Read more at the above link...

The train wreck that is the Government’s economic strategy


The train wreck that is the Government’s economic strategy

2 February 2012

The Central Bank’s quarterly report exposes the train wreck that passes for the economic and social policy of this bankrupt Government and failed system. The system, both at the national and the international level, continues like a ball bouncing down a stairs, falling deeper into crisis.

The mounting payments to service this odious debt—which could cost the people nearly €9 billion this year, plus the payments to bond-holders due this year, coming to about €5 billion—are unsustainable. Growth is now forecast to be no more than 0.5 per cent; this is far below what the Government and all the establishment think-tanks believe is necessary to “pay our debts.”

The payment of this odious debt piles more and more pain upon the people as this Government and its EU allies attempt to deal with the massive socialised debt on the backs of the people, to save the German and French banking system. They have constructed a permanent debt relationship that will continue indefinitely, with massive transfers of wealth from the people of the peripheral countries to the finance houses of Frankfurt and Paris.

The austerity pact will be a permanent policy and is a pact to fleece and rob the people. It is to ensure that more of the people’s money will be spent on servicing a debt that is not theirs than will be spent on the people’s basic needs, such as decent health and education services.

Eugene Mc Cartan

087 9733414

Austerity pain all in vain

Repudiate the Debt Statement

February 2 2012

Austerity pain all in vain

The quarterly report from the Central Bank on projected growth in the economy of 0.5 per cent in 2012 exposes the falsehood that we can continue to pay this odious and anti-people debt by “growing the economy.” Great hardship and pain are being inflicted on our people in what is clearly an impossible task of paying back this socialised corporate debt.

In the first month of 2012 alone this state spent €769 million servicing the interest on the national debt. This will come to a minimum of €9 billion this year merely in servicing this corporate debt. Added to this are the payments to bond-holders that fall due for payment this year, running into nearly €5 billion.

The servicing of this debt is the real reason for the savage austerity pact. The state cannot provide services to the people and save German and French banks at the same time. There is clearly only one solution: the people’s interests must be put first and foremost. Saving German and French banks is the responsibility of those two states. This is not the people’s debt and must be repudiated before it completely beggars our people and country, with all the austerity pain having been in vain.

Paul Doran


087 6837650

Alan Greenspan’s self- acknowledged errors

Alan Greenspan’s self- acknowledged errors

By Andrew Murray

Since the Financial Times is presently running a series on “Capitalism in Crisis” it makes every sense to ask Alan Greenspan to contribute. After all, the former Chairman of the US Federal Reserve has his fingerprints all over the current crisis of the system he worships. Indeed, if one man could be said to have brought the world to its present pass, it would be Greenspan. His fanatical belief in deregulation and in the dogmas of an absolute free market, allied to his continual flooding of the US with cheap credit during his time in charge (a policy which guaranteed the inflation of one bubble after another, including the terminal mortgage-loan one) could almost justify us terming the 2008-to date crash as the “Greenspan slump”.

Immediately after the meltdown, Greenspan was briefly rocked back on his heels. Summoned to explain himself to a Congressional hearing he allowed that he had, to paraphrase, misjudged the capacity of the bosses of the biggest banks to judge their own self-interest (and shareholder interest) accurately. When the chairman of the committee underlined that this meant that Greenspan had found that “your view of the world, your ideology, was not right” the dethroned maestro glumly acknowledged “precisely”.

This was quite a comedown for a lifelong disciple of Ayn Rand, the author of the capitalist utopian novel Atlas Shrugged. This is a badly-written book of unblushing misanthropy, but it inspired the young Greenspan and others of like persuasion fighting through the long Keynesian night of the 1950s and 1960s. They formed a cult around Rand (a Russian émigré) which, if accounts are to be credited, bore a passing resemblance to the carryings-on of the Workers Revolutionary Party in its Healey heyday.

Like the bourgeois elite generally, Greenspan has been recovering his poise somewhat since. Certainly, he is through apologising, although (as with those who say it is time to stop saying sorry for the British Empire) he never really got going on the whole repentance thing. But he faces a mighty challenge, not just because of events around him going from bad to worse, but because of the nature of his view of capitalism.

It is not for him simply the best of all possible systems from the options available, nor the natural product of social evolution and the march of freedom, to take two other fairly widely-held views. For him it is, or ought to be, perfect. Left to its own devices, free-market capitalism should result in utopia, with a complete absence of any problems for humans other that those which spring from the frailties of the heart – for thus spoke Rand, who herself was sometimes tripped up in her missionary work by the latter.

So how does the once unchallenged oracle of Wall Street, convenor of the “committee to save the world” (to cite his designation in a 1999 Time magazine cover story) explain the fine mess he has gotten us into? He has two strings to his bow – anti-communism and appeals to “human nature”. Both are among the last resorts of scoundrels, today as for the last 100 years.

To take the second first, Greenspan writes: “The oft-assailed greed and avarice associated with capitalism are in fact characteristics of human nature, not of market capitalism, and affect all economic regimes.”

This is an argument which leads almost nowhere. “Human nature” is, for a start, a good deal more plastic than Greenspan allows. It did not emerge unchanging as from hewn rock, and has gone through considerable modification through several millennia of developing forms of social organisation of increasing complexity. But if we allow the concept for a moment it can still hardly be prayed in aid of full-on free-market Greenspanism.

For a start, it could be asserted that “aggression” is a basic human characteristic, at least as much as “greed” is. Yet it could hardly be argued that society should pass no laws to set limits on aggression (individual, group of national), but should simply shrug and leave the aggressive to get on aggressing as mandated by human nature. Instead, society generally recognises it as a bad(ish) thing and sets out to at least curb it. Greenspan’s world, however, celebrates greed – and it is not to harsh on aggression either, particularly if it opens doors worldwide for the greedy

It is also noticeable that not only are some people a good deal more greedy than others, without being endowed with any more “human nature” than the rest, but also that humans appear to be naturally inclined to co-operation in their productive lives.

This tendency towards co-operation, without which little of anything would be produced at all, is contradicted by greed, or the private appropriation of the fruits of common labour, if we can descend from “human nature” to human practice. The fruit-appropriation side of things was of course going gang-busters in the Greenspan era with a massive transfer of wealth to the global elite.

In acknowledgement of this, Greenspan makes a curious point. “The legitimate concern of increasing inequality of incomes reflects globalisation and innovation, not capitalism.” Whatever way you turn this particular argument, it never ends the right way up.

First, capitalism has always been in its own nature a global system, designed to sweep aside any socially-erected barrier to the accumulation of capital including those erected by its own creations of an earlier time, like the nation-state. Marx and Engels pointed that out in the Communist Manifesto. From that perspective, the post-1991 era is merely the fulfilment of what Americans might call its manifest destiny.

Moreover, capitalist globalisation is a fact that Greenspan himself has celebrated more than once. Indeed, in the same article, before he gets bogged down in all the human nature stuff, he rejoices in the fact that “in 2005 more than 800 million members of the world’s labour force were engaged in export-oriented and therefore competitive markets, an increase of 500 million since the fall of the [ Berlin ] Wall.” More wage-labour, more surplus-value…

So what was the crowning glory of capitalism a la Greenspan had become, a few hundred words later, not just the source of the problem of inequality, but in fact nothing to do with capitalism at all! This is patently absurd, which could be realised either by observing that capitalism generated enormous inequality when the main scope of a given capitalist economy was circumscribed within national boundaries, or by asking the question as to what is driving all the “globalisation and innovation” if it is not capital?

But this cuts to the heart of the Greenspan world-view. Capitalism is, in theory, perfect, so any problems it displays need to be sourced elsewhere. Capitalist practice, he acknowledges, “needs adjustment” before lamenting that any “improvements” to the capitalist model (my emphasis – AM) will likely make things worse.

One problem which, he allows, causes him “distress” has been “the extent to which bankers, previously pillars of capitalist prudence, had allowed their equity buffers to dwindle dangerously as the financial crisis approached.” So “human nature”, which had previously blessed bankers with “prudence”, underwent a lightning change in the very years when Greenspan himself was the main mediator between our natural selves and the market, and sent all the hitherto-thrifty executives out on the razzle instead.

But even if human nature did turn out to be such a fickle mistress, flitting between prudence and greed at a whim, it could not account for the crash because, to deconstruct Greenspan further, he laments above the absence of prudence in preparing as “the financial crisis approached”. So the crisis itself did not emerge from human nature in either its benign or malign variations, but externally. The imprudent bankers are as the foolish virgins without enough oil in their wicks, but they are not themselves the reason for the delay in the bridal party arriving.

From whence then did the crisis spring then? On this point, the oracle is still silent. He is probably wondering what on earth the late Ms Rand would have made of it all. So no wonder the reflexive reversion to anti-communism, or anti-socialism of any sort to be more exact, since the Fabians get it in the neck along with the German Democratic Republic.

This is a larger subject, but it must be pointed out that millions of humans found both socialism in the east and social-democracy in western Europe perfectly “natural” even unto the point of, on all polling evidence, mourning their absence from the menu of permitted political choices in the world that Greenspan has wrought.

Their return must be the spectre haunting the former chief “master of the universe” as he slides towards dotage. It must be for galling for him to even read a series in the FT on “capitalism in crisis” -his capitalism - let alone be asked to contribute to it. But he would have got well paid for his piece – natural avarice you see, more of a consolation for him than the rest of us.

Andrew Murray is a regular contributor to 21stcenturymanifesto