The Conservative-Liberal Democrat coalition government has at long last unveiled their ‘welfare reform’ plans, which are already touted as being “the “most significant reform” of the coalition so far”.(1) As expected, the reforms are mainly centered around the Work and Pensions Secretary Duncan-Smith’s pet project, the implementation of a single benefits system. Under this system, all benefits would be put essentially into one ‘package’, the universal credit – with the notable exception of disability benefits – and be immediately linked to the payroll deductions tax database. The advantage would be that doing so would allow the government to no longer have to rely on the old ‘all or nothing’ approach to benefits, and thereby eliminate the possibility of part-time or short-term work causing an actual decrease in overall annual income compared to unemployment. Instead, people under such partial contracts would be allowed to keep part of their universal credit so they would not lose out on the move towards regular work. Continue reading “The Schizophrenia of Mr Duncan-Smith”
Tag: Crisis
European Strikes Confront the Assault of Capital
All throughout Europe the organized peoples have been on strikes and protest actions against the massive assault of capital against the so-called ‘welfare state’. Governments from the United Kingdom to Greece have sought to greatly reduce the meaning and scope of the variegated systems of protection that exist in Europe against the depredations of the ‘free market’, using the great financial crisis produced by that same ‘free market’ as an excuse. They seek to support private capitalists such as banks and insurance companies by aiding them with enormous loans, while at the same time using the state debt this entails as a pretext for declaring insolvency in the face of popular demands for relief against the effects of the crisis and the rising unemployment. In so doing, they have however been forced to show their true face more than in these days most liberal governments like to do: they have brazenly and openly declared the maintenance of the profit system to be of greater importance than the well-being of the citizens whom they supposedly represent. This is the true ‘dictatorship of capital’, and more and more the peoples of Europe are seeing it for what it is. Continue reading “European Strikes Confront the Assault of Capital”
The Red and the Green III: Two Ways Forward
As the world attempts to recover from the current economic crisis and the first prospects for the future are being produced by economic forecasters and bank analysts, it is important not to forget the ecological dimension. As many people have explained before, including an article in this blog, the course our system of perpetual accumulation by means of competition has set is absolutely unsustainable from an ecological point of view. Not just the fact of the sheer consumption of the First World, so excessive that it would require several times the resources of our planet to provide to all, but also the fact that our modern historical period is considered by zoologists to be one of the world’s rare periods of mass extinction should make this clear. Even the most liberal capitalist-inclined politician is now aware of this, and such habitual profit-seekers as the Economist and the Chinese government are acknowledging the matter as serious. But there are still essentially two schools of thought on how the problem might be solved before the catastrophe predicted by most ecologists and climate experts is upon us. Continue reading “The Red and the Green III: Two Ways Forward”
Crisis in Greece
A commonly heard expression among politicians and newspapers during this economic crisis has been the phrase “too big to fail”. It refers to the basic principle under capitalism that in times of crisis, which capitalism necessarily engenders every now and then, the largest companies and banks cannot be allowed to go bankrupt. Smaller businesses can go bankrupt, millions can become unemployed, but a truly ‘free’ market solution of bankruptcy for all overinvested corporations would so thoroughly destroy any modern advanced economy that it would inevitably lead to revolt and revolution. To stave this off, any amount of tax money and borrowing is therefore justified to save banks and companies of such size that their fall would risk taking everything else with it. As a result, real unemployment in the United States is estimated to be around 16%, yet enormous sums in the billions of dollars have been borrowed by its government to prop up the profitability of its largest banks and insurers, from AIG to Goldman Sachs.(1)
Yet rarely is this expression used for an entire country, even though there is no reason why entire economies should not have the same position within regional wholes. Where Iceland has now gone essentially bankrupt as a result of its ultraliberal banking policies and the subsequent extortion of its debtors by the Netherlands and Great Britain, its small size and relatively one-sided economy prevents this from becoming a major economic problem. The same cannot be said of Greece. Continue reading “Crisis in Greece”
The Fall of the House of Dubai
The great capitalist dystopia of Dubai, a huge speculation bubble in paradisical tourist islands and business skyscrapers built on the slave-labor of South Asian migrant workers, is on the verge of collapse. Even though it is located in one of the driest and hottest parts of the world, its developer-king, Sheikh Mohammed bin Rashid al-Maktoum, saw a bright future for the place as the great playground of modern cosmopolitan capital. Indeed he presented himself and the whole project as a capitalist variation on the ‘enlightened kingdom’ of the old concept of the philosopher-king: none of those pesky things like regulations and taxes, or even good taste, could stand in the way of capitalist development here. In Dubai, anything would and should be possible on a larger and more commercial scale than ever before seen. Continue reading “The Fall of the House of Dubai”