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Looting the globe

Instead of catering to the unhinged greed of international finance, we should be fighting back.


Last week we learned that in 2008 and 2009 the US Federal Reserve Bank had lent out $9 trillion---yes, that's trillion, with a T---to the world's largest banks (including Canadian banks) and corporations. Hedge funds made good use of the money; "the program generated big returns for investors---as high as 48 percent in some cases at the height of the crisis, though more commonly in the range of 20 to 40 percent," reported the Wall Street Journal.

Meanwhile, working people are being squeezed for their every penny, and then some. In only the most recent of what will surely be a string of crises, Irish banks are being bailed out by loans of 85 billion euros; those loans, however, won't be paid back by the banks but rather by the Irish government, which will raise the money by lowering wages and increasing property and income taxes. Oh, but Ireland's corporate tax rate, the lowest in Europe, will not be touched.

The US has gone one step further: The ever-craven Obama is poised to cave in to teabagger demands and extend tax cuts to the wealthiest of the wealthy, a loss of revenue that can only be reconciled by slashing into the bedrock of American prosperity, the Social Security pension plan.

Throughout the world, "austerity" rules for regular people, while trillions flow unimpeded to the wealthy. Banks and hedge funds are bailed out, with the assumption that no investor should ever be responsible for bad decisions or asked to assume an iota of risk, while public works and relief programs are defunded with abandon. It's an ideological victory for a crazed version of capitalism that will almost certainly cast the world again into recession.

And again, speculation is distorting the commodity markets beyond all reason. Over the past year, futures in oil have gone up 20 percent, corn 51 percent, soybeans 23 percent, wheat 39 percent, coffee 40 percent, cotton 78 percent. Those numbers will soon translate into starvation, deprivation and hardship for billions of people.

In short, the predatory class is looting the globe. What can we do about it in Nova Scotia? The short answer is "not much"---the decisions that bring the vast bulk of global wealth into ever fewer hands are mostly made elsewhere, behind closed doors.

Still, that doesn't mean we have to go along with them. There's a dope-think among elites locally, that somehow we're immune to the global catastrophe that's unfolding before us because Canadian banks are better regulated and completely isolated from the world markets. Out of the other side of their mouths, our elites tell us we can all become filthy rich by giving huge tax breaks to gigantic financial service firms to set up their back offices in Halifax because, after all, it's a global economy.

But catering to the band of thieves organized as the financial services industry is not just abetting the crime, not just immoral, but also stupid: Sooner than later, the well of human misery they're ripping off will either run dry or revolt, and those firms will abandon Halifax in half a heartbeat. As with Ireland, we'll be left cleaning up their mess on our dime.

Rather, what we should be doing is building greater wealth among regular people locally. We can do that in a lot of abstract ways---invest more in Community Economic Development Investment Funds, support labour struggles for better pay, shore up depleted pension plans, et cetera.

One very specific thing we can do is protect ourselves from the commodity bubble that's upon us and ween ourselves off imported oil. We do that through energy retrofit---hiring construction workers to inspect homes and add insulation and energy efficiency features as needed. HRM's proposal to finance and assist in installing solar water-heating systems is a great first step, but it'll be shorted because it depends on federal funds and must break even.

If we can afford a net loss of $6 million annually for 25 years in tax revenue for a convention centre, then surely we can afford to spend 10 times that on an energy retrofit program that will save regular people money, keep people warm and keep local dollars local, rather than seeing those dollars feed the crimes of the global financial industry.

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