Capitalism mugs Greece. Who is next?

From 21st Century Manifesto:

by Zoltan Zigedy
July 26, 2011

To understand the fate facing the people of Greece, you have to imagine an intruder coming to your home, putting a gun to your head and demanding that you turn over your earnings, surrender your savings, and sell off your car, your television, and your refrigerator t. Greek citizens neither benefited from the profit frenzy of international bankers nor encouraged their irresponsible behavior, yet they are being asked – no, forced – to pay the price for the damage incurred in the collapse of the world capitalist system.Greece – a small corner of the European Union – and its people know little of the exotic instruments concocted in the world’s financial centers to overproduce massive amounts of phantom capital fueling the growth of this rapacious system. They are only indirectly acquainted with the arrogant, irresponsible actions of giant investment banks like Bear Stearns, Lehmann Brothers or Goldman Sachs. Very few Greeks see their future tied to the success of the predatory financial behemoths that roam the global economy. And yet they are being forced, at gun point, to pay for their losses.

When the media fog lifts, this is clearly the plight of Greece’s eleven million citizens.

If home invasion, armed robbery, and extortion are crimes, then surely Greece is a crime victim. And the European Union, the European Central Bank and the International Monetary Fund are the criminals. They are aided and abetted by the bond bandits who prey on debt, pouncing on a country struggling to revive its sinking economy. And their puppets – pathetically willing accessories to the crime – are the PASOK leaders and parliamentarians who attempt to legitimize the crime.

With few exceptions, countries have been obliged to take on additional debt to stimulate economic growth in the face of a severe drop in global investment and broad demand. Capitalist economies have no option other than sinking further in decline. In earlier times, deficit, debt-producing spending produced improved growth and accompanying inflation. Growth and inflation, in turn, increased tax revenues and cheapened debt, allowing the public debt to shrink in proportion to the economic product. This has long been a feature of capitalist recoveries from mild to severe recessions. Conventional economists teach this as though it were a universal law.

But we live in exceptional times and conventional economists are seldom right about anything any more.

Today, two factors have changed this dynamic. First, the near-total domination of neo-liberal ideology has shaped opinion to fear public debt of any degree. What was once the dogma of the fringe right has, thanks to over forty years of focused, class-based intellectual encroachment, spawned a uniformity of thought among the media, politicians, and opinion makers bordering on faith and defying history and facts. What began as the so-called “Washington Consensus” in 1989 has become an international consensus, gaining near-theological obeisance. International capitalist institutions like the International Monetary Fund have eagerly embraced its tenets.

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