Financing Poverty: Rescuing the Rich instead of the Poor

ISIS Press Release 03/11/08

Taxpayer's money is being misused in the global financial crisis to rescuing those that have grown super-rich by draining the real economy, creating poverty, and fuelling the destruction of the earth Time to replace the dominant model with a circular eco-economy that mimics nature Dr. Mae-Wan Ho and Prof. Peter Saunders

Rescuing the rich instead of the poor

More than 116 million people around the world demonstrated on October 17-19 to demand that the governments of 22 wealthy nations meet the promises they made at the Millennium Summit 2000 to wipe out extreme poverty and disease in the developing world by 2015 [1, 2]. The rich nations had undertaken to dramatically increase their foreign aid, and this commitment is reaffirmed every year by the leaders of the G8 nations. But shamefully, not only has foreign aid not increased, it has actually shrunk in real terms for the past two years.

Within the past few months, a financial crisis of unprecedented proportions has hit Wall Street and rapidly spread to Europe and the rest of the world. And in complete contrast to the slow, miserly way in which the wealthy nations have treated the poor, they sprang to action with the utmost generosity to rescue the rich.

By the end of October, £1.8 trillion have been wiped off the global economy, according to Bank of England's latest estimate [3]. The US bailout alone has already cost the taxpayer more than US$1 trillion. That's a huge amount, but still small compared with the total value of the world's economy at $65 trillion, and a mere drop in the ocean against the $596 trillion in outstanding global derivatives (financial contracts). The taxpayer's money is being thrown into a “bottomless pit”, says David Korten [4], a long-time critic of the financial system and author of international bestseller, When Corporations Rule the World (1995, 2001). The danger is that if governments continue to misdirect massive public funds towards rescuing the financial system, its collapse will bring down the real economy.

It is important to distinguish between the real economy of people trading in goods and services based on real value, and the financial system, which trades in money as such, in sub-prime mortgages, derivatives, hedge-funds, and private equities that have become “reckless speculation that produces nothing of real value”. It is the difference between “ Main Street ” and “Wall Street”.

What's more, it is the financial system that has impoverished people and planet because mainstream economists and governments advised by them are committed to the dominant model of unlimited growth based on the ideology that competition in the “free market” will fix all, and because they cannot see the difference between money and real wealth.

Market is not free, and money is not wealth

Conventional wisdom in economics has it that markets freed from government interference will self-correct. That's an important assumption for the theory and much of the justification for opposing regulation, but it is simply not the case. As George Soros (“speculator, investor, philanthropist, political activist” [5]) – someone who understands the system well enough to have benefited enormously from it - describes in his book, The New Paradigm for Financial Markets: the Credit Crisis of 2008 and What It Means [6], whenever there is anything more than a minor fluctuation, the authorities have generally come to the rescue, though not to the extent of imposing the necessary regulation.

What is happening today is unusual only in the magnitude of the intervention; there are many earlier examples, including the bankruptcy of Continental Illinois in 1984 and the failure of Long Term Capital Management in 1998.

Korten writes [7]: “We can now see clearly that the more Wall Street freed itself from regulatory oversight, the more its most powerful players manipulated markets and politics to their personal benefit. The more reckless their risk taking became, the greater the instability of the financial system, and the greater the threat to the rest of the economy.”

Read the rest of this article here http://www.i-sis.org.uk/FinancingPoverty.php



http://freepage.twoday.net/search?q=financial+crisis
http://freepage.twoday.net/search?q=financial+system
http://freepage.twoday.net/search?q=free+market
http://freepage.twoday.net/search?q=mortgage
http://freepage.twoday.net/search?q=derivatives
http://freepage.twoday.net/search?q=hedge+fund
http://freepage.twoday.net/search?q=Wall+Street
http://freepage.twoday.net/search?q=Main+Street
http://freepage.twoday.net/search?q=speculation
http://freepage.twoday.net/search?q=poverty
http://freepage.twoday.net/search?q=taxpayer

World-News

Independent Media Source

User Status

Du bist nicht angemeldet.

Suche

 

Aktuelle Beiträge

Trump and His Allies...
https://www.commondreams.o rg/views/2022/06/21/trump- and-his-allies-are-clear-a nd-present-danger-american -democracy?utm_source=dail y_newsletter&utm_medium=Em ail&utm_campaign=daily_new sletter_op
rudkla - 22. Jun, 05:09
The Republican Party...
https://truthout.org/artic les/the-republican-party-i s-still-doing-donald-trump s-bidding/?eType=EmailBlas tContent&eId=804d4873-50dd -4c1b-82a5-f465ac3742ce
rudkla - 26. Apr, 05:36
January 6 Committee Says...
https://truthout.org/artic les/jan-6-committee-says-t rump-engaged-in-criminal-c onspiracy-to-undo-election /?eType=EmailBlastContent& eId=552e5725-9297-4a7c-a21 4-53c8c51615a3
rudkla - 4. Mär, 05:38
Georgia Republicans Are...
https://www.commondreams.o rg/views/2022/02/14/georgi a-republicans-are-delibera tely-attacking-voting-righ ts
rudkla - 15. Feb, 05:03
Now Every Day Is January...
https://www.commondreams.o rg/views/2022/02/07/now-ev ery-day-january-6-trump-ta rgets-vote-counters
rudkla - 8. Feb, 05:41

Archiv

November 2008
Mo
Di
Mi
Do
Fr
Sa
So
 
 
 
 
 
 

Status

Online seit 7154 Tagen
Zuletzt aktualisiert: 22. Jun, 05:09

Credits


Afghanistan
Animal Protection - Tierschutz
AUFBRUCH für Bürgerrechte, Freiheit und Gesundheit
Big Brother - NWO
Brasilien-Brasil
Britain
Canada
Care2 Connect
Chemtrails
Civil Rights - Buergerrechte - Politik
Cuts in Social Welfare - Sozialabbau
Cybermobbing
Datenschutzerklärung
Death Penalty - Todesstrafe
Depleted Uranium Poisoning (D.U.)
Disclaimer - Haftungsausschluss
... weitere
Profil
Abmelden
Weblog abonnieren