"The end of a cycle”... The beginning of what?

Today "El País" published a “special” editorial indicating that we have reached the “end of a cycle”, and affirming that early elections must be held immediately. They believe that even November will be too late. What’s the rush? How can this urgency be justified at home and abroad? With the present economic crises in both the U.S. and Europe, with the markets dictating political policy, with media powers that have fallen into discredit, with G-8 or G-20 plutocrats’ total incapacity for world governance, and with such serious problems in Libya, Syria,...

But above all, what is the forecast for Spain at this “end of cycle”? The same as for Portugal, the United Kingdom, Greece or Italy... that is, additional budget cuts, more privatization, total obedience to the “great domain” (military, economic, energy, media)? What are Spain’s alternatives? Are there really programmes of possible solutions? Because the “evidence” provided by the governments of several Autonomous Communities are hardly promising, given their excessive spending, prevalent corruption, etc.

I sincerely believe that the time has come to sit down and seriously analyze our great challenges together, to decide what can really be done at the local national, European and global levels, free from haste and disinformation from so many biased communications media, and with the responsibility of statesmen representing the citizens of Spain who are likewise citizens of the world, compelled to restore the democratic principles that globalizers replaced with the rules of the marketplace, while for the moment ignoring our differences and ambitions, as with a patient who requires intensive care.

Let us consider with all due objectivity how Spain can contribute to resolving the colossal (social, environmental, food) problems posed at the “end of cycle” of a system that sought to take the reins of humanity common destiny with so much tragic “collateral damage”! And now, as in 1989 with the Soviet regime, it is all coming to a resounding end, without our having seriously agreed on the formulas to apply in building a future to reflect the dignity of all human beings, which the coming generations demand and deserve.

When it’s time to take important, clear and collectively relevant decisions, it is neither wise nor advisable to allow individual grudges to blur our vision of the future.

A global “end of cycle”… And then what?

A local “end of cycle”... And the beginning of what?

To be or not to be. That is the question...

More market and less State, the “vicious cycle”…

The “globalizers” not only intend to achieve dominance but hegemony: the markets, aided by the masses hypnotized by the colossal power of the media, have progressively weakened the capacity for political decision-making. Governments have not only transferred huge quantities of all types of resources to large supranational consortia, but with the complicity and urgency of the “bubbles” and delocalized production they have also ceded, at the national and global levels, executive responsibilities that should be exercised by democratic institutions.

The G-6, G-7, G-8 or G-20 groups of rich countries have usurped worldwide powers and authority that only the United Nations can and should assume, with the support of all of its member states.

And thus, this total lack of governance, completely deregulated economy, irresponsible financial institutions (hedge funds) and overflowing tax havens prompted a systemic crisis in 2008.

Although President Obama had already been elected, in November of that year Europe turned instead to President Bush, rather that finally taking the reins of its own governance. And the result was more of the same –“free market, free trade, free economy”, said Bush on that occasion- proceeding to “rescue” the financial institutions that were to a great extent responsible for that serious situation.

The impoverished “rescuers”… were soon thereafter subjected to the hounding of the ungrateful “rescued” who imposed upon them national, regional and global “adjustment” mechanisms. A genuine “vicious cycle”, since government spending cuts and privatization –leading to less State- decreases prospects of creating employment and economic recovery, while the rating agencies, working in favor of the “great domain”(military, energy, media…), warn that forecasts are (logically) negative… So the cycle starts again: additional adjustments, increased privatization, more budget cuts…

We must immediately break this vicious cycle. It is essential to once again endow State with the capacity for action and the economic strength to enable them to urgently commence the “new era” that the world so justly demands. If democratic governments don’t soon take this step, the people certainly will, since they now have means for mass mobilization.

The time for manipulation, blackmail and fear has come to an end. The last stubborn representatives of this faltering system should be reminded of the fall of the Berlin Wall, and the markets should peacefully give way to State and to the values that should never have been traded for a price.

We’re being classified, rated, standardized… This has gone too far!

Financial ratings, academic rankings, educational qualifications, scientific quantification… partial reports, biased evaluations that are immediately released and often exaggerated in the communications media, and we can’t contrast them with our own evaluation criteria or with results from truly impartial observatories at the local, national or EU level…

As examples, the following recently appeared in the press:

-“Acropolis Now”, is the title of an article published in The Economist on May 1, 2010: “The Greek debt crisis is spreading. Europe needs a bolder, broader solution—and quickly… Germans need to understand the risks to their banking system and their prosperity… Stemming Greece’s debt crisis is less an act of charity than of self-interest... Thanks to extraordinary incompetence, Europe’s leaders have almost ensured that the Greek rescue failed before it began.”

-“Salgado and Ordóñez defend the banking system vis-à-vis market debt. Moody’s believes the sector may need 100 billion Euros in the event of recession. The Bank of Spain explains that and European politicians ‘contribute’ to the markets’ attack on sovereign debt…” (El País, 14 December 2010)

-“Moody’s thinks Spain is vulnerable and threatens to lower its rating” (ABC, 16 December de 2010)

-“In permanent crisis. Moody’s threat to lower the debt rating punishes the delay in reaching an agreement on financial reform” (editorial from El País, 16 December 2010)

--Last year in December it was already being said that “Europe is reacting: positive messages to protect the Euro with additional capital for the ECB and a rescue fund…” “This time is different: it is irresponsible to leave the future of the European Union in the hands of the markets” (José Ignacio Torreblanca, both articles in El País, 17 December de 2010)

-“S&P torments Portugal by lowering its debt to just one step above junk bonds” (ABC, 30 March 2011).

-“S&P puts the U.S. on notice and extends the sovereign debt crisis to the other side of the Atlantic… The agency lowered the country’s outlook to “negative” and threatens to cut its rating if it does not reach an agreement to reduce budget deficits soon” (ABC, 19 April 2011) In its response the U.S. Treasury underscored that S&P underestimates the ability of America’s leaders to come together to address the difficult fiscal challenges facing the nation.

-“Doubts concerning Greece punish Spanish debt and bring downturns in the stock markets” (El País, 19 April 2011)

--It doesn’t matter whether citizens trust their political leaders if the markets don’t: “The markets still don’t trust the Spanish financial system… They don’t trust the figures... They doubt that financial institutions are sufficiently capitalized in view of the weak real estate market and the poor perspectives in that sector” (IDEAL, 20 April 2011)

-“Upheaval in the markets… The markets punish Greece and Portugal” (El País, 22 April 2011)

-“For Greece there’s no other way than to apply strict austerity measures,” declared Jean Paul Trichet. “Greece must privatize 50 billion Euros and cut over 150,000 public-sector jobs”. (El País, 15 May 2011).

-“The Social Democrats have been forced to implement conservative policies” (Manuel Cruz in El País, 15 May 2011)

-“The insatiable greed of speculative markets and rating agencies” (Mario Soares in Diario de Noticias, 17 May 2011). “The EU must urgently amend its development model: if it doesn’t it could face an irreversible downward spiral and even disintegration”.

-“S&P cuts Catalonia’s rating again, due to its high tax debt" (El País, 20 May 2011)

-On 21 May 2011, El País quantitatively expressed “the risk of ‘countries on the periphery’ as the percentage of 10-year bond yields with regard to PIGS: the worst, Greece (16.2%), then Ireland (until recently cited as a “model” in MBA programs) with 10.1%; Portugal with 8.9%; and Spain with 5.5%.

-“Moody’s deals Greece a further three-notch downgrade, given its risk of default” (El País, 2 June 2011)

-“The EU and the IMF will provide a second rescue to save Greece from bankruptcy” (ABC, June 2011)

-“The European Parliament proposes ending the rating agencies’ oligopoly” (Público, 7 June 2011)

-“Moody’s affirms that Catalonia puts Spain’s deficit target at risk. The agency believes that the central government lacks the ability to enforce discipline on the regions” (El País, 7 June 2011)

-Yesterday, July 7, on the front page of El País: “Europe raps rating agencies after Portugal downgrade. The EU accused them of fueling speculation and anti-European bias; the debt premium has soared to highs in the weaker euro-zone states”.

-Also in yesterday’s El País, there was an article entitled “Confidence Betrayed: Moody’s unfair downgrading of Portugal renders the creation of a European rating agency imperative”.

-Yesterday Público underscored: “Brussels alleges that the rating agencies are fueling speculation. The German Finance Minister calls for limiting the agencies’ oligopoly; UGT accuses these institutions of “revenge” and CCOO affirms that they represent very important interests in the financial sector”.

-And today, 8 July 2011, Público published the following: “Suspicious ratings… To regain institutional confidence, strong measures must be taken against these agencies” (B. Boye) In the same newspaper, “Montoro defends the rating agencies”…

-In El País, “The ECB supports Portugal against the rating agencies. The markets appear to be the greatest enemy of popular sovereignty, which is the foundation of democracy”…

Who is the “rater” behind these agencies, who issues these ratings as he pleases?

--The foundation of democracy! We’ve even included the “markets” in our constitutions (Article 38 of the Spanish Constitution)… and now we’re complaining. And not even the EU dares to reject the rating agencies because the “markets” won’t tolerate such insubordination…

This has gone too far! As I like to repeat, the European Union must urgently apply the “creative efforts” extolled by Robert Schumann in 1950 when establishing the foundations for the Treaty of Rome. Creative efforts in economics, in labor, in autonomy, defense and security, in the creation of our own rating and monitoring institutions, as warranted, in order to strengthen democracy… which is founded on the voice of the people. And the voice of the people is now being heard…