[Peace-discuss] banking bailouts *are* protectionism! from another fine Dean Baker article

[Barbara kessel]

I agree with Mort. Ricky, send this somewhere to publish. These reflections
are an important reminder in this land of individualism and Empire. What an
amazing stew of illusions that makes. Barbara

On Sat, Nov 15, 2008 at 5:00 PM, Ricky Baldwin <baldwinricky at yahoo.com>wrote:

> It's an excellent point, Stuart.  And I think it *is* complicated.
>
> A generation or two, maybe more, have learned to pronounce "protectionism"
> (even "intervention" in the context of the economy) as if synonymous with
> "incest" or "child pornography", "free enterprise" as if synonymous with
> "truth, justice and the American way."  The truth is, capitalism doesn't
> actually *work* without constant intervention, and it can't develop anywhere
> without protection.
>
> It's not just the bailout - we do it *all the time*!  What are copyrights,
> patents, trademarks if not protection?  Big tax breaks, industrial
> development funds, TIFFs - are these "free" enterprise?  Does Wal-Mart move
> in without publicly funded roads, publicly funded extensions of sewer lines
> - in some places water and electric utilities and trash pickup (which ought
> to be public here, too) - and in e.g. Urbana the gift of a new parking lot?
>
> What about all the gov't research - not just pharmaceutical, the internet
> (the whole thing), not to mention TV, and innumerable other 'hard'
> technologies, but also all that business development "research" that
> universities like UIUC charge the taxpayer for and then hand over gratis to
> 'investors'?  And what do *we* get out of it?  That question seems to be
> lost in the cheerleading.
>
> It's not enough, we have to suppose, that capitalism itself is always based
> on theft - land from indigenous peoples, labor from slaves, resources from
> foreign lands whose governments we topple or manipulate with debt or
> military aid or some such drug, or labor again the full value of which the
> bosses never pay because if they did they could never "profit" but only
> trade.  No, that part wasn't exactly easy - it took intensive and extensive
> support from centuries of sympathetic gov'ts willing to fight wars, suppress
> strikes and rebellions, execute "pirates", enforce the return of escaped
> slaves, sign and break treaties, etc., etc. - but we have it all behind us
> now, and more is required.
>
> I personally think we shouldn't be naive.  Most of us are not primativists,
> much as we may respect Earth First! et al.  But if we want a certain kind of
> society, a certain 'level of economic development' (for lack of a better
> term) with high literacy and low infant mortality and so on, OK, there's a
> price.  But that doesn't mean Margaret Thatcher was right with TINA (There
> Is No Alternative).  If 'progress' is what we want, we should go into it
> with open eyes, sober, and say, all right, maybe certain types of technology
> can't develop so well in individual garages and cottage industries.  Or
> maybe there's a way to develop that kind of thing down the road, once we
> make the initial public investments and so on.
>
> And maybe in the current economic web in which we find ourselves, we can't
> allow huge chunks of the web to just collapse and take hundreds of thousands
> of lives along.  The cost - and I mean the human cost - of "letting them go"
> would likely be a humanitarian disaster, though probably not as bas as some
> of the predictions.
>
> But the priorities need to be set socially, I think preferably in some sort
> of democratic way, though most methods will have their drawbacks.  We have
> to do our best.  Investments need to match these social priorities: probably
> something like health, education, sustainable energy, whatever - and I think
> some kind of international relations that don't privilege the military
> solutions.
>
> Of course we're light years from anything like that, at least from a system
> organized primarily along those lines.  Hard to imagine an interview with an
> award-winning economist in the New York Times saying this kind of stuff,
> without the word "satire" or "entertainment" affixed somewhere.
>
> But the funny part is, most people like the sound of it.  Not everybody,
> but most people.  We just don't believe it's possible.   Somewhere in the
> back of our brains millions and millions of heart-of-hearts socialists,
> really believe in TINA, not in the sense of believing in an ideal, but in
> the sense of believing in the law of gravity.  There's an idea that it's
> hard-wired into a supposedly immutable or at least biologically determined
> "human nature" that is willing to entertain ideas of social justice mostly
> as whims and fancies and is basically cutthroat.  It's junk-science, of
> course, but even those of us who haven't fallen into this trap still can't
> muster much hope for the kind of social revolution that could bring about
> such things.
>
> I won't argue that right now - but just point out that it isn't all or
> nothing.   We already *have* massive intervention in the economy by every
> level of government.  What we have to do is pressure the gov't on its
> priorities.  It's actually a very good time to do it, too, confidence in
> capitalism being at a low, expectations of the incoming government being
> high, and so on.  But without the proverbial "heat from below" the system
> promises to recalcify quickly, and intervention is likely to follow the
> model of "socialized risk, privatized profit."
>
> Ricky
>
> "Only those who do nothing make no mistakes." - Peter Kropotkin
>
> ------------------------------
> *From:* Stuart Levy <slevy at ncsa.uiuc.edu>
> *To:* peace-discuss at anti-war.net
> *Sent:* Saturday, November 15, 2008 12:20:27 PM
> *Subject:* [Peace-discuss] banking bailouts *are* protectionism! from
> another fine Dean Baker article
>
> We keep hearing from financial pundits & politicians
> about the need to avoid falling into the sink of
> protectionism.  Keep our markets free, etc.
>
> But Dean Baker's recent article points out that our
> bank bailouts -- which guarantee the stability of US and
> European banks, making them as safe as their governments --
> is exactly that, protectionism, and it puts the banks of
> other countries at an enormous competitive disadvantage:
>
>     http://www.truthout.org/111008D
>     "The G-20 and Biological Warfare", by Dean Baker
>
>
> [...]
>
> The G-20 will no doubt decide to make some aid, presumably through the
> International Monetary Fund, available to the countries being hit by the
> fallout from Wall Street's financial meltdown. But this aid will come with
> strings and likely not be sufficient to make these countries whole.
>
>     There is no easy remedy to this situation. But it should be obvious to
> the
> developing world that the only way that they can protect themselves from
> the
> episodic crises created by the rich countries is to have alternative poles
> of
> financial support. Specifically, if they can establish regional funds, as
> the
> South American countries have begun to do with the Bank of the South, then
> they
> can hope to insulate themselves from the financial dealings and misdealing
> of
> the wealthy countries.
>
>     Building up regional funds will not be easy. Countries will have to
> make
> compromises and surrender some control to allow a regional fund to operate
> effectively. In addition, the wealthy countries will go to considerable
> lengths
> to prevent the creation of effective regional funds. The most obvious route
> will be to invite a few important actors in the developing world to sit
> among
> the wealthy countries as junior partners.
>
>     These tactics may prove successful. However, until the developing
> countries
> can turn to alternative sources of capital, they will be susceptible to
> every
> crisis resulting from the regulatory failures of the wealthy countries,
> even if
> they had been completely responsible in managing their own financial
> affairs.
> It's not fair, but that is the way the world works.
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