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Neo-liberalism and austerity in one paragraph

Michael Hudson on Europe, but it's just as true here:

At issue from Europe’s vantage point – at least that of its bankers – is a broad principle: Governments should run their economies on behalf of banks and bondholders*. They should bail out at least the senior creditors of banks that fail (that is, the big institutional investors and gamblers) and pay these debts and public debts by selling off enterprises and shifting the tax burden onto labor. To balance their budgets they are to cut back spending programs, lower public employment and wages, and charge more for public services from medical care to education.

Sound familiar?

It's exactly what's happening here, fully supported by both legacy parties and the "progressive" Boddisattva, Obama.

NOTE * IOW, James Carville was right.

NOTE Economic numbers pretty ugsome, too. That's because austerity doesn't work, except for the bankster elite.

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RedQueen's picture
Submitted by RedQueen on

It's government BY the people, FOR the people. Banks and corporations (despite what the supremes say) are not people. Corporations, banks and even governments are just ideas set on paper. People live and breath and eat and die. Ideas can change, but people still need to live and breath and eat and maybe die slower if we're lucky.

Submitted by Anchard on

Your post reminded me of three things I noticed in the past few days that seemed connected.

First, the WSJ article this week on public schools in the U.S. charging fees:

Public schools across the country, struggling with cuts in state funding, rising personnel costs and lower tax revenues, are shifting costs to students and their parents by imposing or boosting fees for everything from enrolling in honors English to riding the bus.

At high schools in several states, it can cost more than $200 just to walk in the door, thanks to registration fees, technology fees and unspecified "instructional fees."

Second, Carol Thompson is a political scientist who has written some very interesting things on the damage caused by structural adjustment programs (SAPs) in Africa and Latin America. Most of these were imposed by the IMF and World Bank at times of crisis as the condition on which loans were disbursed (“conditionality”), as Naomi Klein documents so well in The Shock Doctrine.

From a 2000 paper by Thompson:

A final example of the crucial role of the state in Southern Africa is its vital social function in promoting greater equality and in the provision of primary education and primary health care. One of the poorest countries in the world, Tanzania, had 100 percent primary school attendance in the 1970s, with well over 90 per cent literacy. SAP conditionality in the 1980s required students to pay school fees, even at the primary level. Primary school attendance has consequently fallen to about 75 per cent; in Zambia, it is under 60 per cent. During the 1992 drought, Zimbabwe was required by the IMF to impose user fees on primary health clinics in rural areas. After two years of outcry, the fees were removed, but under austerity conditions the government is prohibited from spending the necessary funds and the health care delivery system is crumbling. By contrast, in the 1980s, before SAP, Zimbabwe won international awards in health care and UNICEF cited its achievements in inoculation and the reduction of infant mortality.

And for the coda, the likely outcome – even more polarization. From a NY Times piece this week on college admissions and enrollment:

For all of the other ways that top colleges had become diverse, their student bodies remained shockingly affluent. At the University of Michigan, more entering freshmen in 2003 came from families earning at least $200,000 a year than came from the entire bottom half of the income distribution. At some private colleges, the numbers were even more extreme….

When we spoke recently, [Amherst College’s outgoing President] mentioned a Georgetown University study of the class of 2010 at the country’s 193 most selective colleges. As entering freshmen, only 15 percent of students came from the bottom half of the income distribution. Sixty-seven percent came from the highest-earning fourth of the distribution. These statistics mean that on many campuses affluent students outnumber middle-class students.