Christina Livingston, a supporter of people who had lost their homes to foreclosure, or have been battling banks over loan modification, is arrested outside a Chase bank branch in downtown Los Angeles Thursday, Dec. 16, 2010. Police arrested 22 protesters who blocked the doors to the bank in acts of civil disobedience. Meanwhile those responsible for the financial collapse and foreclosures get off scot free. (AP Photo/Reed Saxon)

by Michael Roberts

The banks and bankers that triggered or caused the global financial crash with their reckless drive for grotesque profits continue to get away with the consequences of their actions. The latest fine by US regulators on the Bank of America was a whopping $17bn. But, as has been pointed out by various bloggers and the Economist, it was not really so whopping. That’s because of the $17bn fine, for selling misleading mortgages to poor householders and distributing rubbish mortgage bonds to customers and investors, only $9bn is in cash. The rest is an amount reckoned to be equivalent to revising mortgages for householders in difficulty. That’s something that should have been done anyway by the banks. Instead, the US Justice department has done sweetheart deals with the banks so that they can count part of the fine as providing the service they ought to have done before.

The ratio of these corrections to cash is 89% in the case of the Bank of America deal; 44% for the JP Morgan fine of $13bn and 56% for the Citigroup deal of $7bn. The non-cash element keeps rising in every new deal. So it seems that bankers can avoid prosecution for offences that have devastated millions of livelihoods (loss of homes, jobs, savings etc) and can get a special deal with the authorities that increasingly does not involve even Read the rest of this entry »

AWSM (Aotearoa Workers Solidarity Movement) and Redline blog are organising a public meeting in Dunedin on why workers and left political activists shouldn’t vote in 2014.  We will be counterposing the need to develop a new left movement of, for and by workers rather than the narrow limits of the parliamentary circus being offered up to us on September 20, election day.

Saturday evening, September 13, 7pm
Dunedin Community House, 283 Moray Place

Speakers:
Dr Bryce Edwards (Otago University*; NZ politics commentator);
Malcolm Deans (Sec, Unions Otago* and member of Aotearoa Workers Solidarity Movement);
Colin Clarke (former member, Independent Working Class Association* in Britain; member, editorial group of Redline blog)
(Organisations/institutions mentioned for identification purposes only)

A poster and flyer will be available shortly.

In the meantime, you might find the following articles useful:
How do we challenge capitalist bullshit?
Parliament does not exist
What I’ll do instead of voting this election

by Michael Roberts

Every August, the great and august among central bankers and strategists of the world economy meet as guests of the Kansas City Federal Reserve for an economic symposium at Jackson Hole, Wyoming, a ski resort under the Teton mountains. After the planes, helicopters and limos have transported them all to the luxurious lodge, the participants make and hear presentations and speeches on the economic issues of the day.

This year, the theme was ‘labour market dynamics’, in other words, the strategists of capital (mainly US capital) were considering whether labour markets in the major economies were sufficiently ‘flexible’ to reduce the high levels of unemployment engendered by the Great Recession and to look for the causes and solutions to the very slow recovery of employment. (http://www.kc.frb.org/publications/research/escp/escp-2014.cfm).

In one paper, mainstream economists, Steven Davis and John Haltiwanger, of the University of Chicago and University of Maryland, reckoned that “the US economy became less dynamic and responsive in recent decades.” And the reason was too much government regulation. They calculated that the fraction of workers required to hold a government-issued licence to do their jobs rose from less than 5% in the 1950s to 29% in 2008. Adding workers who require government certification, or who are in the process of becoming licensed or certified, brings the share of workers in jobs that require a government-issued licence or certification to 38% as of 2008, they say. So the slow recovery from high unemployment is the fault of government regulation and not the market economy.

In contrast, Read the rest of this entry »

gaza

Gaza is a prison whose inmates are being strangled and killed, not a bantustan

by Tony Norfield

Israeli racism and violence should obviously be condemned, but land theft is the key question. Consider this: on what basis should the slaughter by Europeans of Jews before 1945 result in the allocation of Palestinian land to Zionist settlers by imperialist powers in 1948? It is not only the post-1967 land grab by Israel that is a crime. The Israeli state is illegitimate and a result of imperialism in the region.

The term ‘apartheid’ to describe the Israeli system is also incorrect. Israel far prefers to kill Palestinians and steal their land, which is not the same process as formerly in South Africa. For example, Gaza is not Israel’s Bantustan for the Read the rest of this entry »

Dirty PoliticsHow attack politics is poisoning New Zealand’s political environment by Nicky Hagerdirtypolitics

Reviewed by Daphna Whitmore

For over a week Nicky Hager’s book Dirty Politics has been in the news. With its promise of a tell-all about the links between the political right and their bloggers revealed in hacked emails, the first print run was sold out in a day.

At just over 100 pages Hager’s book is an easy, though not pleasant, read. Delving into the thoughts and motives of blogger Cameron Slater, and others around him who specialise in attack style political campaigning, is a putrid business.

Most of Dirty Politics confirms what we already knew from reading Slater’s Whale Oil blog. His style of politics is vicious and crude. What Hager adds to the picture is Slater as a PR agent for hire. Read the rest of this entry »

mikebrownThe following statement was released by the Popular Front for the Liberation of Palestine and first appeared on their site on August 18

In light of the police murder of the martyr Michael Brown and the ongoing struggle in Ferguson, Missouri, in the United States, the Popular Front for the Liberation of Palestine salutes and stands firmly with the ongoing struggle of Black people and all oppressed communities in the United States.

Comrade Khaled Barakat said in an interview with the PFLP media outlets that “Police brutality, oppression and murder against Black people in the U.S., and against Latinos, Arabs and Muslims, people of color and poor people, has never been merely ‘mistakes’ or ‘violations of individual rights’ but rather are part and parcel of an integral and systematic racism that reflects the nature of the political system in the U.S.”

“Every time a crime is committed against Black people, it is explained away as an ‘isolated incident’ but when you see the GlobalIntimassive number of ‘isolated incidents’ the reality cannot be hidden – this is an ongoing policy that remains virulently racist and oppressive. The U.S. empire was built on the backs of Black slavery and the genocide of Black people – and upon settler colonialism and the genocide of indigenous people,” said Barakat. “The people of Ferguson are resisting, in a long tradition of Black resistance, and we support their legitimate resistance to racist oppression.”

“As people in Africa, Asia, Latin America and the Arab World see the brutality of the United States outside its borders, these communities confront its racist and colonial oppression within Read the rest of this entry »

Below are two important articles on the current state of the world economy.  In the first article, Michael Roberts suggests that recent data shows the weakness of the ‘recovery’ from the partial meltdown of the financial sector (itself a result of the tendency of the rate of profit to fall in the productive sector).  Usually crisis indicates not only the sickness of the system but also acts as a cure, opening the way to a new round of accumulation; Michael notes that this does not seem to be much in evidence this time around.

The second article is by the French revolutionary workers organisation Lutte Ouvriere.  LO also note the weakness and fragility of the current ‘recovery’. 

The two articles should be read together.

 

The Myth of the Return to Normal

 

The latest economic data for the main capitalist economies is not encouraging for the optimists that the world economy is set to resume normal service.

Last week, we had the first estimate for US GDP for the period April to June (see my post, http://thenextrecession.wordpress.com/2014/08/01/the-risk-of-another-1937/ ). The US economy has been the better-performing top economy over the last few years. But even here, real GDP growth was just 2% yoy, well below the long-term average since 1946 of 3.3% a year.

US nominal GDPThe recovery has been weak.  In the five years after the Great Depression troughed in 1933, US nominal GDP (that’s before inflation is deducted) rose 52%. In the five years since the end of the Great Recession in mid-2009, US nominal GDP has risen only 18%.  The gap between US nominal GDP and where it would have been without the Great Recession remains wide – and even getting wider.

Indeed, US economic growth appears to be in secular decline. In the 1980s and 1990s, the US economy generated nearly 40 quarters where GDP was 4% or higher on an annualised quarter or quarter basis (not yoy). But there have been just seven of these “hypergrowth” quarters since 2000, if you include the last quarter. But that will be revised down when the huge rise in stockpiles of goods that were included in the 4% quarterly figure are reduced. So US real GDP growth was less than 2% yoy last quarter.  And yesterday, figures for American spending in shops came out and they were not pretty either. Retail sales were flat in July and the yoy rate slowed from 4.3% in June to 3.7% in July.

Things are far worse elsewhere. The data from the Read the rest of this entry »