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The detritus of neoliberal capitalism

Capitalism isn't working bannerThe HSBC Swiss bank is not an isolated episode. It is part of a general pattern exposing the underlying ideology which has been globally dominant over the last three decades. That ideology has been about consolidating the power and wealth of the world’s richest class, particularly in the West. It is based around the idea that the most efficient and successful way to run the world is through untrammeled markets freed to the highest possible degree of any external constraints.

The message for governments is: get out of the way and leave it all to markets to steer capital, employment and growth in the most profitable direction, and it will be best for everyone. It hasn’t been, as the historical record shows. The average annual GDP income growth in the UK in the 30 years before 1980 was 2.4%; in the 30 years after 1980 it was 1.7%. But that has not prevented this ideology from gaining pernicious dominance in the Western consciousness reinforced by politicians of all parties paying lip service to it.

However multiple cracks are steadily becoming apparent in this ideology of which the HSBC Swiss bank scandal is only the latest example. Most notably it led directly to the biggest financial crash for a century in 2008-9 which was triggered by an international recession severely aggravated by the recklessness and arrogance of over-powerful banks seeking profit maximization through sub-prime mortgages and exotic financial derivatives, abetted by supine politicians offering across-the-board deregulation of all financial constraints. This was by far the worst crash, but internationally there were 6 others in the last 30 year period; in the previous 30 year period there were none.

At the political level neoliberal capitalism demanded freedom for a fundamentalist market regime. The most essential ingredient for Western economic dominance was oil. The Middle East contained 60% of global oil resources, and this was secured for Western interests partly by the perverse US-Saudi relationship, but more directly by the invasion and conquest of Iraq, justified by Bush as a consequence of 9/11 though Saddam, for all his wickedness, had nothing to do with 9/11. That led to the successful Iraqi insurgency and triggered indirectly the continuing conflagration in the Middle East and the rise of Islamic State.

The increasing control by the wealthy elite in Western societies is shown by the growing revelations of the unchecked power of the financial sector, manifested not only by these latest HSBC depredations (reproducing very similar illegalities committed by HSBC banks in Mexico a few years ago), but more particularly by the massive illegality of rigging the Libor, Euribor and forex markets in the City of London and the further widespread market manipulation by PPI and the rigging of interest rate derivatives particularly targeted at small businesses.

3 Comments

  1. Jeffery Davies says:

    Did you think they would change back to model banksters nah they still at it but leaving em off without jail time for the austerity they give to the masses still doing whot they do best fiddling but untill those ninty nine percent who aint rich wake up to the fact then more fiddled monies to be screwed from the poor jeff3

  2. swatantra says:

    Time to release the wrath of the Occupy Movement, and this time really strike, with a vengeance at the heart of capitalism and monetarism and the 1%.

  3. Kevin Mullins says:

    Michael you repeat the notion of 9/11 as being middle eastern in it’s origin. The neo-liberals will go to any length to achieve their objectives. This alone was the biggest ever con trick perpetrated against the world. The evidence is there if people care to look for. There is a growing number of experts especially in architecture and construction who have been calling for a fresh enquiry into 9/11. The suggestion being that it was all orchestrated by the Pentagon under direction from the military/industrial complex. History teaches that weapons manufacturers have lobbied long and hard with all National governments to buy their goods but to maintain production they need for those weapons to be used. The answer in 2001 was to create a never ending war on terrorism the consequences which we see 14 years on. If you are going to quote 9/11 then at least look into what the real truth is.

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