World financial crisis Part 5

NDPP wrote:

NYT is Wrong on Dedollarization (and vid)

Michael Hudson debunks Paul Krugman's dollar defense.

This should be a simpler question to answer but, like in many other areas, it is taken over by partisan political biases. The simple statistical question is: “To what extent are different international currencies being used to buy and sell things as reserve currencies internationally?” Krugman seems to be sticking to current economic statistics while Hudson seems to be sticking to his political biases.

Josh Marshall is a slightly left of centre liberal, but he also has a Ph.D in history, and seems to be as intellectually honest as any of us. He put up a piece today, The Rise of the Global Oligarchs, that might not directly be about the global financial crisis, but is closely enough related that posting it here makes sense to me. He cites a number of examples from recent times, and then comes up with a hypothesis about what they all have in common. I found it quite fascinating. Here is the final paragraph.

Josh Marshall wrote:

I don’t write this post today with a particular observation or conclusion. I want to put the trend and thicket of questions on our collective radars. A central feature of the Early Modern era was weak and underfunded states licensing private entities to exercise state-like powers and then later trying to claw back that license. All of the colonies of that would later become the fledgling United States were founded on this basis. The arc of colonial North American history saw the English and then British monarchies trying to assert directly monarchical control over these fledgling societies. A better known example is the British East India Company which conquered and administered large parts of South Asia before being brought under tighter and tighter state control until being finally extinguished in the 1850s. We live today in an age of reversal in which increasingly public disinvestment, privatization and the rise of a global billionaire class is in key ways reversing that process.

“Developing countries” are trapped in a new debt crisis - World Bank : How can this be explained?

The latest World Bank report on the debts of “developing countries”, published on December 13, 2023 [1], reveals an alarming fact: in 2022, developing countries as a whole spent a record US$ 443.5 billion to pay for their external public debt. The 75 low-income nations that are eligible for loans from the International Development Association (IDA), a World Bank organisation that provides loans to the world’s poorest nations, paid a record US$ 88.9 billion to its creditors in the same year, 2022. These 75 nations have an unprecedented total external debt of US$ 1,100 billion, which is more than twice as much as it was in 2012. As per the press release from the World Bank, the nations in question experienced a 134% increase in their foreign debt between 2012 and 2022, which was greater than the 53% increase in their gross national income (GNI).

The World Bank is therefore sounding the alarm: a new debt crisis has begun. Vast quantities of money are being used to pay off debts, rather than addressing the increasing needs of hundreds of millions of people who desperately need support. According to another World Bank report quoted by the Financial Times [2], between 2019 and 2022, over 95 million more people have fallen into extreme poverty......

Baby born in Hamilton encampment shows extent of 'desperate' housing crisis, councillor says

A Hamilton councillor's recent experience witnessing a baby born in an encampment in the city demonstrates the "unacceptable" housing crisis residents face and "eye opening" situations paramedics and police officers are currently responding to, he says. 

Coun. Matt Francis (Ward 5) told CBC Hamilton he was doing a ride along with police on a cold morning in late November when they were called to a medical emergency at an encampment tucked away in an industrial area in the east end. 

They arrived at the same time as paramedics and "to our surprise," he said, a woman had given birth in a tent and was holding the infant with the umbilical cord still attached. There was another person in the tent with her. 

"I was one of the very first people to see this child born and I was shocked and saddened at the same time," Francis said in an interview Monday.

Paramedics cut the umbilical cord and wrapped the baby in a blanket, while police helped the mother onto a stretcher. She and the baby were taken away in an ambulance, he said. 

"My heart goes out to the mother and any other mothers in such a terrible situation," said Francis, a father of two. "My heart goes out and breaks for the children too that are born into the world that way.".....

Economists: "The era of corporate supremacy in the international trade system is coming to an end"

We, economists from institutions across the world, welcome the decision by the Honduran government to withdraw from the International Centre for Settlement of Investment Disputes (ICSID). We view the withdrawal as a critical defence of Honduran democracy and an important step toward its sustainable development.

For decades, international arbitration courts like ICSID have allowed corporations to sue states and restrict their freedom to regulate in favour of consumers, workers and the environment. Since 1996, governments in Latin America alone have been forced to compensate foreign corporations over $30 billion, intimidating regulators away from raising minimum wages, protecting vulnerable ecosystems, and introducing climate protections, among other domestic policy priorities. We find scant economic evidence that mechanisms like ICSID stimulate meaningful foreign direct investment, in return.

Honduras presents a powerful case of corporate abuse through the ISDS system. Since the 2021 election of the country’s first woman President, Xiomara Castro, corporations have brought a total of 10 ICSID cases against them. The largest, brought by the US corporation Próspera Inc, seeks more than $10 billion — two-thirds of the country’s annual budget — as compensation for the country’s decision to derogate the disastrous “ZEDEs” law that forfeited Honduran territory to foreign corporations like Próspera to found private cities that operate almost without regard for labour, environmental, or health regulations.

The era of corporate supremacy in the international trade system is coming to an end. The European Union recently announced its withdrawal from the Energy Charter Treaty (ECT). US President Joseph R. Biden, meanwhile, has pledged to not have provisions for these corporate courts in future trade deals. And major developing countries, such as Brazil and India, stand firm in their refusal to enter treaties like ICSID in the first place.

Now, the government of President Xiomara Castro has taken another important step to prioritise sustainable development over corporate profit. As economists, we commend President Castro and the people of Honduras, and hope that countries across the world follow their lead toward a fairer, more democratic trade system.....

..all owing to austerity, war and enviroment killing resources. and with a lot of help from the police with their inflated budgets. 

The Billionaire Class in the U.S. Is Now Bigger Than Ever – We Need Progressive Taxation Now.

A new, disturbing milestone has been confirmed with the release of Forbes Magazine’s 38th annual World Billionaires List. The US billionaire class is now larger and richer than ever, with 813 ten-figure oligarchs holding $5.7 trillion firmly in their possession.

This is a $1.2 trillion increase compared to the year before, bringing total billionaire gains since mid-March 2020 to a gargantuan $2.7 trillion in current dollars.....