Tuesday, June 23, 2009

Another Interesting Piece by Michael Hudson

Michael Hudson has published a nice round up of Obama's financial reform package on Counter Punch on Monday (June 22).
Here are the opening lines:

In reaching across the aisle for Republican support – and no doubt future campaign contributions from the financial sector Pres. Obama is morphing into Joe Lieberman. There also is a touch of Boris Yeltsin in his sponsorship of a financial “reform” ominously similar to what advisor Larry Summers backed in Russia – relinquishing government power to a banking elite. The Financial Regulatory Reform proposal promotes Wall Street’s “product,” debt creation, at the expense of the economy at large, and lets financial chieftains continue to self-regulate the debt industry – and to keep scot-free all their gains from the past decade’s worth of fraudulent lending.

[Read More ...]
Toward the end of the piece is this interesting nugget that one should keep in mind when trying to get their head around the nature of the US economy, and its impact on our political culture right now ...
More bank lending – that is, more debt – is the heart of today’s economic problem, not the solution. Finance capitalism is undercutting industrial capitalism, replacing the production of goods and services with predatory extraction of rent and interest via economic “tollbooths,” from parking meters in Chicago to roads in New Jersey. States and localities are facing fiscal shortfalls obliging them to sell off their roads, parking meters and public enterprises to buyers who erect expensive tollbooths and extract yet more income from the shrinking “real” economy. The economy is heading toward debt peonage as it polarizes between wealthy patrons and a work force reduced to patron-client dependency relationships.

When friends and commentators wonder why there are not more -- well, any actually -- public protests over the rapidly deteriorating situations from the kitchen tables to the local schools out there on main street, it is largely because these friends and commentators have an urban-industrial model of political culture given them in the college-level story books they study [mostly written 150 years ago or derivative from those written 150 years ago]. We live in a very different post-urban, post-industrial world here in the US now, one that is deeply de-centralized, patron-client, rather than highly centralized worker-management ...

Something to ponder ...

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