Disaster Capitalism Hits: Governments using "deficits" to push rightwing anti-worker policy goals

Disaster Capitalism Hits Europe (and the US is Next)
Eurozone governments and European authorities are using the economy to justify pushing through rightwing policy changes
by Mark Weisbrot
Mark Weisbrot is Co-Director of the Center for Economic and Policy Research (CEPR), in Washington, DC.
July 9, 2010

One thing should be made clear about the situation in the eurozone economies that is not clear at all if we rely on most of the news reports. This is not a situation where countries face a "dilemma" because they have overspent and piled up too much public debt. They do not face "tough choices" that will force them to cut spending and raise taxes while the economy is weak or in recession, in order to "satisfy financial markets".

What is really going on is that powerful interests within these countries - including Spain, Greece, Ireland and Portugal - are taking advantage of the situation to make the changes that they want. Perhaps even more importantly, the European authorities - including the European commission, the European central bank and the IMF - who are holding the purse strings of any bailout funds, are even more committed than the national governments to rightwing policy changes. And they are further removed from any accountability to any electorate.

In 13 Bankers, by Simon Johnson (a former chief economist at the IMF) and James Kwak, the authors describe the emerging market crises of the 1990s and note that Washington used them to promote changes that it wanted: "When an existing economic elite has led a country into a deep crisis, it is time for a change. And the crisis itself presents a unique, but short-lived opportunity for change." Naomi Klein, author of The Shock Doctrine, provides an excellent history of how crises have been used to introduce or consolidate regressive and unpopular economic "reforms".

Unless the goal is to reduce wages and benefits in the public sector, weaken labour, redistribute income upward and reduce the size of government, then there is no time like the present to push these things through. We have a similar, although not yet as severe political problem, in the United States: deficit hawks are mounting a campaign to cut social security, even though it can make all promised payments for the next 33 years.

Ironically, the people who want to take advantage of the "crisis" in Spain are actually increasing the risk of more serious debt problems, since the debt burden will rise if the economy lapses into recession or years of stagnation because of their fiscal tightening measures. But they are willing to take these risks in order to accomplish their political objectives.

Read the full article at:

http://www.commondreams.org/view/2010/07/09-11

...the elites may not quite find "comfortable...?"

don'tcha think? I do. I think they know just where they're going with this.

Angry people can be led in different directions by those planning ahead and anticipating their anger. They could be led against the privileged institutions, which have failed to deliver on their promises of mass prosperity, or they can be led to destroy the enemies of those corrupt institutions, as well as a variety of unrelated scapegoats at the same time.

"Disaster Capitalism Hits: Governments using "deficits" to push rightwing anti-worker policy goals"

..... of the end game the elites have been actively working towards since Reagan was elected.

The America we all grew up in will forever be gone unless people start standing up against "austerity programs" and the MSM's constant harping about deficits in this economic crisis.

:cry: