The Era of the GNP, intolerable, vulnerable, fleeting

This isn’t the era of “the Peoples” that we imagined when referring to the United Nations System. Nor the era of educated, cultivated and participative citizens, capable of building genuine and effective democracies. Nor the era of creativity and knowledge as the basis for the economy and progress.

No: now everything depends on the GNP. Only the wealthiest countries come together to govern the world. The US and UK initially convoked only the richest: that was the G-6. They later added Canada to form the G-7. Then with Russia it became the G-8… Subsequently aware that the hegemony of a select few was a failure, the number was increased to 20 (twenty something…). And that’s how it stands today, while they attempt to steer clear of the storm. But a shipwreck is inevitable if they don’t rapidly include the people and build democracies at the local, regional and global levels, with a strong United Nations.

Democracy is the only solution. The GNP labyrinth can only be escaped from above, guided by universal principles that include and respect all human beings. We can’t continue to invest thousands of millions of dollars daily while thousands die of hunger each day, especially in those countries with low GNPs. We can’t continue with infinite greed to irresponsibly favor countries that despite their positive GNP rankings, are constantly and seriously violating even the most basic human rights. At the supranational level we cannot continue to allow mafia consortia to traffic in drugs, arms and people (!) with total impunity. Nor can we continue to permit tax havens to launder money of dubious origin.

The prediction is clear: I believe that maintaining this economy based on speculation, delocalization of production and war is the final gasp of a system that is on its deathbed.

Fortunately, citizens can now express themselves. Fortunately, the mobilization of the peoples will be led by the scientific, academic, intellectual and artistic communities that are aware of this reality and will not be sidetracked by those who, at all cost, seek to postpone the “new beginning” in which social justice and the great ethical principles will once again guide world governance.

The GNP may reflect a country’s wealth, but it does not reflect the welfare of its people. And now the people will finally cease to be silent and obedient spectators. The days are numbered for the era of the GNP.

“Not one more day”

The West’s drift off course, hounded by the markets, must stop immediately.

The front page of the Sept. 3, 2011 “El País” announced that “the ghost of recession in the U.S. and the EU once again prompts drops in the markets” in those States such as Spain which, in order to safeguard them, have been obliged to introduce urgent changes, even in the Constitution, essential for intra-European unity but at quite a price in authority and prestige for the politicians subjected to the mandates of the global “great domain”.

On the 4th, the European Central Bank warned Berlusconi that he needs to make further adjustments… and former president José María Aznar, always so positive and opportune (!), declared that “Italy and Spain must admit that they have been saved”. It’s bewildering to think that the former president and current advisor to Murdoch may once again be able to influence national politics.

On the 5th the headline was “Fear of recession collapses the markets”. And on the 7th, to really prompt speculative attacks, the president of the World Monetary Fund, such a bearer of good news, warned of an “imminent global recession”.

Antonio Machado declared that “only fools confuse value and price”. Many government leaders were very foolish when they agreed to replace the values of democracy and justice with the laws of the market.

These articles, with their references to the sad public images of government leaders, hounded by biased stock market fluctuations that require adopting measures to reestablish the ethical principles that good governance requires, are accompanied by alarming photographs of the leaders of Europe and their associates dividing up the skin of the Libyan bear even before it has been captured, often with the percentages already calculated and with the sinister horizon of Sharia law, instead of a widely proclaimed democracy.

“The Italian ENI prepares for its return to Libya”… “The multinationals are once again fighting for a piece of the Libyan energy industry pie” (ABC, Aug. 29, 2011). “China is afraid of being excluded when the Libyan loot is divvied up” (“Público”, Aug. 31, 2011). “The struggle for oil sullies the Libya Summit in Paris” (“Público”, Sept. 2, 2011)…

…And “The UN agrees to release frozen Libyan assets”.

The United Nations sought to save the lives of the Libyan rebels. Through NATO this “protection” has grown into to an overt and decisive participation in the struggle. The Sept. 2 “El País” announced that “The world gives its blessings to the new Libya…”. “The world” means the countries convened by President Sarkozy… and among them, the Secretary General of the UN. Contrary to what would be desirable, it isn’t Sarkozy in the UN but rather the UN in Sarkozy!

More democracy and less “marketocracy”, in the clever but also correct reference to the ever-increasing impact of “the markets”. It is clear that the unemployment rates won’t drop in the U.S., Europe and Spain (especially due to the enormous real estate bubble, prompted by “the greed and irresponsibility of a few”, in the words of President Obama) because all of the cuts work against the creation of employment (not to mention the excessive delocalization of production).

How can they “stimulate consumption” with budget cuts, privatization and decreases in public investment?

How can we regain confidence, if the markets only allow us to continually reduce margins and possibilities for citizen initiatives?

How can the WMF demand greater stability when its predictions immediately prompt instability?

But of course, the wealthy take advantage of these fluctuations to buy low and sell high when the markets have logically recovered from their losses…

It is essential – not one more day!- to make an about-face:
1) In the EU:
i) autonomy in security matters and an urgent reduction in military spending; allies of the U.S., yes, but not subjects of the U.S. through NATO.
ii) economic and fiscal federation, creation of a European rating agency, issue of Eurobonds and outright elimination of tax havens;
iii) agreement on major plans for renewable energies and regulation of oil consumption and prices;
iv) joint international cooperation projects to contribute to providing all human beings with access to food, water and sanitation and health services;
v) moderation of the delocalization of production, with strict control of working conditions and respect for human rights in the manufacturing countries;
vi) coordination of human and technical resources to address natural and manmade catastrophes at the regional level;
vii) proclamation of the democratic principles that should guide political action, promoting participation and listening to the people, particularly through virtual communications media (cyberspace), ensuring not only unrestricted freedom of expression, but also access to accurate information for all citizens, regulating the standardizing excesses of the huge media powers…
2) In the U.S.
i) In the bitter decline of hegemonic claims, promote alliances, particularly with regional associations, and share experience and knowledge to guarantee world governance through an urgently-reinforced United Nations.
ii) Urgently lead nuclear disarmament, to facilitate a future free of atomic threats, and rapidly reduce arms sales, especially of those intended for past conflicts, developing new security technology that reflects present needs.
iii) Fully integrated within the new United Nations System, endow the WMF, WB and WTO with the necessary authority to put an end to speculative attacks on the dollar zone, euro zone and the yuan zone, promoting a world economy based on sustainable development, so that those who still cling to the idea of maintaining the “great domain” will be convinced of the inexorable need to contribute, now, to the commencement of a new era…
3) At the global level
i) As I have already often had the occasion to underscore, we can no longer delay an emergency meeting of all countries to re-found the United Nations, to make it capable, with the authority conferred upon it by the support of the great majority of nations, of efficiently addressing the great challenges that arise at any time: Libya, Syria, Yemen… the Israel /Palestine conflict… terrorism, supranational trafficking in arms, drugs, people…
ii) With the United Nations at the helm, “a new beginning” would commence, characterized by agreements and alliances. China, India, Latin America, Africa… must play a role that will brighten the horizons of our future generations.

This is our greatest commitment.

Not one more day.

Disarmament and modernization of Defense strategies

Bravo! At last the Spanish Ministry of Defense has reacted and has risen to the demands of democratic governance: "We shouldn’t have acquired systems that we are not going to use, with money that we didn’t have", declared the Secretary of State for Defense in August, 2011. To honor commitments and alliances –especially NATO, which should for once and for all be channeled into a European security system, allied with but not dependent on the U.S— particularly under the previous administration, Spain acquired large stocks of weapons that we neither needed nor could pay for. They are weapons “for conflict situations that no longer exist".

Giving the pertinent orders to Secretary of Defense Robert Gates, over a year ago President Obama announced the design and implementation of a new security strategy to address more quickly and efficiently new types of conflicts, which since the Viet Nam War have proven to require new modes of combat and materiel.

But the power of the huge war machine industry is not so easily dissuaded.

A year ago (September 13, 2010) the International Herald Tribune warned of the negative effect that global recession would have on the arms trade. In 2009 there was a 8.5% decline and “only” 57,500 million dollars worth were sold. The U.S. represents 40% of the world’s market. The best clients are the countries of the Middle East and Asia. (Where do the Gulf States put so many aircraft?) Because almost simultaneously, the largest contract for airplanes ever signed was announced with Saudi Arabia: 60 billion dollars.

After the U.S., the biggest arms merchants are Germany, Italy, China and the United Kingdom.

Right now the Pentagon is calculating whether it will finally be possible to produce the F-35, the most expensive military aircraft in history, to be manufactured by Lockheed Martin. The Pentagon still intends to purchase 2,443 F-35 within the next 25 years, for a total of 382 billion dollars. The Secretary of Defense has warned that there must still be further cuts in materiel and logistics, and that the U.S. cannot continue to assume 75% of NATO’s costs. The European allies invest a maximum of 2% of their GDP in military spending, while in the U.S. it is 5%.

Weapons arsenals have historically been perceived as an indication of a nation’s security. Security that is indeed important, but which is normally considered as the opposite of peace. “If you want peace, prepare for war...".

The time has come to prepare for peace. To “save succeeding generations from the scourge of war", in the words of the Preamble to the United Nations Charter.

New strategies... ceasing to sell or to oblige others to buy expensive weapons for out-dated wars.

Arms! Arms! Can nothing mitigate the shameful hunger, the collective embarrassment of extreme poverty, neglect and indifference? And on a worldwide scale, as if it were unquestionable, security receives thousands and thousands of millions, while peace and human dignity are tossed a few scraps, and more from charity and the kindness of citizens than from justice, as the duty of the State.

Lately the use of unmanned combat planes, the "drones" is being considered. Drones and hunger! Death by hunger, death by drones. By hunger, every day. By drones, once in a while.

The famine in the Horn of Africa had been foreseen. Warnings from institutions of the United Nations System and NGOs have been falling on deaf ears for quite some time... But nothing. Nothing can stop the immense war machine, one of the fundamental pillars of the “great domain".
The use of unmanned aerial systems has resulted in a situation in present conflicts in which rather than soldiers, the victims are principally civilians. And according to The Economist (July 30, 2011) in the last few years the Pentagon has increased its production of drones by 13 times (a minimum of an additional 5 billion dollars annually). They say that armies will progressively use machines instead of people. Predator and Reaper drones, equipped with the latest technology and controlled from thousands of miles away can undoubtedly be useful in many conflicts, and especially against terrorism... provided that the lives of the civilians in the countries in which they are deployed are considered to have the same value as the lives of soldiers of the countries that use them.

I believe it is appropriate to include here a paragraph from Paul Kennedy’s book “The Rise and Fall of the Great Powers”: "…wealth is usually needed to support the military power and the military power to acquire and protect wealth. If, however, too large a portion of the state's resources is diverted from wealth creation and allocated instead to military purposes, then that is likely to lead to a weakening of national power over the longer term. In the same way, if a State overextends itself strategically --by, say, the conquest of extensive territories or the waging of costly wars-- it runs the risk that the potential benefits from external expansion may be outweighed by the great expense of it all, a dilemma which becomes acute if the nation concerned has entered a period of relative economic decline"...

So, bravo for the clarity with which the Spanish Defense Minister has begun making “cuts” that may, in addition to having beneficial internal effects, contribute to putting the “great military domain” in its place... With renewable energies we will soon tame the “great energy domain"... And later the media domain, and the economic domain...

Yes: with the help of virtual mobilization, we may very well be on the verge of the “era of the people".

THE INSATIABLE MARKETS

Will they also take over “alternative” sources of financing, such as the “Tobin tax,” intended for the fight against hunger and poverty?

We must not allow it.

That would be the last straw. With the present balance of power, particularly in the West, we have been forced to reluctantly accept that our weakened States have yielded to the “great domain”, to prevent serious insolvencies that objectively shouldn’t have been allowed, using funds for social projects to pay the debt, deficit reduction… to, in short, satisfy the demands in quantity and time of a system that has lost its course and is in its final death throes.

But now, in addition to the present ones, what we can’t allow is for new “actors” to take the stage to sacrifice themselves in the mob of speculative trading prices, incited thoughtlessly by rating agencies that obey their master’s voice. No: alternative sources of financing must be used as soon as possible to fulfill the duties of international solidarity that the States have neglected, and to be applied to the Millennium Goals. This is a matter of international justice. As long as we continue to be absorbed with stock market fluctuations… while we continue to spend astronomical amounts of money on out-dated war materiel… while we are still at the mercy of the great oil producers without adopting urgent measures concerning the renewable energy sources that our responsibility to future generations demands… while we continue to blindly follow the biased and partial information offered us by the immense stifling and standardizing powers of the media… we will fail to exercise the influence that democratic citizens should, so that our representatives may counteract the hounding from the markets and make policies based on justice and human rights.

Somalia is dying

This distressing photography was published on the first page of “El País” on August 14:

Safia Adem, a refugee in the Cathedral of Mogadishu, mourns the death of her three-year old son. This is the image that we should all bear constantly in mind. These are the real needs that frenetic stock market fluctuations cannot hide.

If these funds are devoted to helping so many people who currently live below the poverty level all over the world, including in the United States, there would be more potential “clients”, there would be a true mobilization of resources to transcend from an economy of speculation, exploitation and war to an economy of global sustainable development.

Not long ago, Marco Schwartz quoted President Franklin D. Roosevelt when he defended his New Deal social program in October of 1936: “We had to struggle with the old enemies of peace –business and financial monopoly, speculation, reckless banking, class antagonism, sectionism, war profiteering. They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know that Government by organized money is just as dangerous as Government by organized mob.”

It’s time to make some key decisions

One of the results of the recent French-German Summit was the proposal of a tax on financial transactions to resolve the depletion of the European countries’ treasuries and, thus, to be able to address the enormous deficit and resulting debt that has lead us to this current crisis and, especially, the rescue of the international financial system initiated in 2008 at the irresponsible prompting of the G-20.

Faced with this situation it is extremely urgent to remember that the proposal of this type of taxes has been a central issue of discussion in civil society and in academia over the last few decades and with a very clear goal: the fight against poverty and in favor of sustainable development for the less fortunate, as well as contributing toward achieving the Millennium Development Goals.

This was originally a proposal that the American professor and Nobel Prize in Economics James Tobin made in 1972 after having developed a series of mechanisms to levy a minimum tax at the international level (between 0.05% and 0.3%) on all transactions involving currencies and financial instruments (shares, bonds, derivatives)… Thus, on the one hand a significant amount of funds would be generated to be devoted to the fight against hunger, poverty and the great pandemics (AIDS, tuberculosis, malaria, etc.). On the other hand, that tax would in part help reduce the speculative nature that currently characterizes the majority of these operations.

We have tirelessly defended the adequate implementation of this type of alternative financing for years and from different institutions, but particularly from civil society: the Ubuntu Forum , the ATTAC movement or the recent "Robin Hood Tax"…

It is important to underscore that since 2004 these ideas have been echoed by a considerable number of associate States in the Pilot Group on Innovative Financing for Development. This group is lead by France, but enjoys the direct participation of other countries such as Japan, Brazil or Chile, and is presently presided by Spain. It also works in designing other proposals for innovative financing, and has conducted studies by groups of independent international experts that demonstrate their viability from a technical standpoint.

In addition to the foregoing we might mention the support received this March from the European Parliament and the letter published this April signed by over 1,000 economists from prestigious institutions such as the Universities of Harvard, Columbia, Oxford, Cambridge o MIT, among others.

Thus, this is a matter of political will and, above all, justice.

For the reasons indicated, it is indispensable and urgent to take measures to address the debt crisis, not only on the part of France and Germany, but on the European level as well. But we absolutely cannot allow this initiative to be implemented, once again, at the cost of continually breaking our promises of aid and solidarity.

A tax on currency transactions and other financial products is an imperious and just necessity, as the previously-mentioned terrible images arriving from the Horn of Africa remind us.

Thus, let’s undertake to work to ensure that the decisions and measures taken in Europe in the short and medium term are not guided by the same instincts of greed and short-sighted vision that has led us to the brink. For once and for all, let us act sensibly and firmly.

This must be stopped, resolutely and with the strength that the conviction of the great majority of citizens affords (and to certain political leaders: please ignore for now your partisan and electoral interests), because as Irene Lozano wrote, “the greatest threat to individual autonomy resides in the weakness of democracy vis-à-vis financial power”.

Don’t trust the G-20 or the WTO… whose “rounds,” such as the one recently held in Doha, have proven to be totally ineffective. They are another bitter fruit of globalization. Let’s return urgently to a strong, democratic, non-plutocratic and united United Nations!

It was already in the news in September, 2010 that the European Union was considering the possibility of levying a tax on transactions to improve its tax collecting capabilities. A European Commission document proposed two types of taxes: a financial transaction tax (FTT) and a financial activity tax (FAT) levied on business volume. A more restrictive version (FTT2) would only tax trading in stocks and bonds.

Now, in October, the European Commission will present a legislative proposal prior to the G-20 Summit, applying a 0.05% to transactions, together with a new Community VAT “to finance the EU budget for 2014-2020, with a view to reducing direct contributions from Member States”.

The Netherlands and Ireland have asked that it be applied not only in Europe, but globally, to avoid “the enormous distortion that this would produce”.

Not long ago, Antonio Valdecantos warned that “adjustments made in the crisis are going to constitute a permanent state of siege. The crucial decisions are no longer made by the citizens or their governments, but by those transnational economic agents known as “the markets”.

We can’t attempt to promote growth when the major objective is to reduce the deficit, urgently and at all cost.

The 255 greatest fortunes of the planet are equivalent to 40% of the most disadvantaged of the world’s population (2,500 million people) . It’s clear that we can’t allow this new action on the part of the insatiable markets.

Civil society must raise its voice through institutions such as ATTAC, which have been created precisely to promote this new type of alternative financing mechanisms, and especially the tax on financial transactions…

We won’t allow this. It would be other dream that they’ve taken from us… and since 15-M we all know that “if they won’t let us dream, we won’t let them sleep”.
------

1 Schwartz, Marco, in “Público”, 20/08/2011.
2 Forum created by the Culture of Peace foundation in 2000. I wish to express my appreciation to its director, Manuel Manonelles, for his collaboration in the preparation of this blog.
3 Missé, Andre in “El País”, September 7, 2010
4 News from “El País”, August 19, 2011.
5 Valdecantos, Antonio in “El País”, June 2, 2011
6 Población, Félix in “Público”, August 19, 2011.