[OPIRG-EVENTS] Fwd: And Humpty Dumpty Had a Great Fall

[david creighton <dcr8on@sympatico.ca>]

Heads up folks ... dc

Subject: WHAT MATTERS-99: And Humpty Dumpty Had a Great Fall
    Date: Tue, 24 Sep 2002 19:26:59 +0200
   From: Boudewijn Wegerif


WHAT MATTERS-99                                  September 24, 2002
And Humpty Dumpty Had A Great Fall

________________________
Dear list members,

As the plutocrat rulers of the most indebted nation, the U.S., follow
their
warrior inclination to secure world domination for the armaments, oil
and
other industries in which they have vested interests, the currency of
their
intransigence, the dollar, teeters on the brink of a great fall - like
Humpty Dumpty in the nursery rhyme.

Below I draw from five sources to underscore how, when the dollar falls
as
it will, all the bombs thrown at Afghanistan and Iraq, and all the
clever
economists of the plutocrats will not be able to put it together again.

The five sources are:
1.   A Look Under the Surface of U.S. Capitalism
2.   An Interview with Dr Kurt Richebächer
3.  The End of Empire by Walter Greider
4.  Secret Blueprint for U.S. Global Domination
5.  Russian Comments on Situation Since 9.11

I agree with the Russian strategic analyst General Leonid Ivashov that
the
U.S. has "come to the climax of her military-power adventures for
grabbing
power over the planet" and that the "peak will be crossed in 1 1/2 to 2
years, after which the USA will retract from its positions as a result
of
economic problems."

We will then see the rapid disintegration of nation states, world-wide,
accompanied by extreme famine, I believe. I have and will continue in
future
E-letters to encourage work now for a post-capitalist world, made up of
small to large, rural to city cooperative economies.

Here let me add, I recognise that I was rather carried away by planning
zeal
in part four of the four-part essay, For An Ubuntu Economy in Southern
Africa, posted at http://www.whatmatters.nu/ubunteco.html.

It was a useful exercise, to set down an economic model that I had been
thinking about for many years, and it was appreciated by several list
members. However, for love to rule in community, there must be a greater

openness to and longing for love and its rule than is possible in an
economy
of such abstract complexity as I portrayed in the essay.

I will write more about this in my next E-letters, and will open the way
in
E-letter 100 with an extract from Power and Sex-A Book About Women, by
Scilla Elworthy, a director of the Oxford Research Group, which she
founded
in 1982 to find out how and by whom nuclear weapons decisions are made.
(PS)

Those of you who have been following recent developments in my life
story,
may deduce, and rightly so, that my interest in this remarkable book on
the
nature of power is related to my marriage to Helena in South Africa in
August. I have now rejoined Helena in Johannesburg and will remain here
until we have permission for her to be with me in Sweden.

In friendship,

Boudewijn Wegerif
What Matters Programme
Folkhogskola Vardingeby **

PS: Power and Sex by Scilla Elworthy was first published in Great
Britain in
1996 by Element Books Limited, Shaftesbury, Dorset SP7 8BP
_______________________
1.
A LOOK UNDER THE SURFACE OF U.S. CAPITALISM

Debts grew by $2 trillion in the U.S. last year; that is almost as much
new
debt in one year as the total debt of the low and middle income
countries in
which 85 percent of the people of the world live.  The growth in the
U.S.
debt was more than ten times faster than the growth in national income,
at
$179 billion.

The debt burdened U.S. economy is in serious trouble. True, there has
been a
5.8 percent annual rate growth in economic activity - the GDP - in the
first
quarter of 2002; but this is thanks to a big jump in government
spending, on
its war on terror and its own planned acts of terror in the Middle East.

"Defence outlays are growing at a 20 percent annual rate," according to
The
Economist.

The real barometer of capitalist virility, corporate profits, is at its
lowest level in the post-war period. In the 1960s, corporate profits
were 9
percent of GDP. At the nadir of the recession in 1991 they had plummeted
to
percent. Currently, they are less than 3 percent of GDP, according to
Michael Roberts in an article, US Capitalism: Digging a Deeper Hole.

Here is a short excerpt from the article, posted on June 10 at
http://www.marxist.com/Economy/digging_a_deeper_hole.html:

   The bubbles of the New Economy and the stock market burst in
millennium
year. In 2002, the bubble of dollar supremacy is also bursting. The
dollar
is diving against other currencies as foreign investors stop buying US
companies, shares and bonds. In 2001, net inflows of capital into US
markets
equalled $44 billion each month. But in each of the first three months
of
this year, only $25 billion came in. Foreigners own 39.5 percent of the
US
Treasury bond market and 23.8 percent of the US corporate bond market.
Both
levels of ownership are at record highs. And foreigners also own 12.7
percent of the US stock market.

   One of the largest sources of dollars was from foreign companies
buying
US companies or setting up production facilities in the US. In the
period
1990-95 average annual European dollar flows from mergers and
acquisitions
was only $10 billion. But in 2000, Europeans invested over $600 billion
in
the US. Taking away US investments in Europe it was a net $214 billion
to
the advantage of the US. That alone financed half of the huge US trade
deficit. Now European purchases of US companies has dropped to just $7
billion. So the dollars dominance over currency markets is slipping and
the
trade deficit is starting to spook the capitalist economists.

   - - - If the past is any guide, an empire's successes are inevitably
followed by humiliating defeats. Financial progress is always trailed by

national bankruptcy and the destruction of the currency. And the good
sense
of a decent people is soon replaced by a malign megalomania, which
brings
the whole bunch to complete ruin. A great empire is to the world of
geopolitics what a great bubble is to the world of economics. It looks
omnipotent at the outset, eventually it is a catastrophe.

--
2.
AN INTERVIEW WITH DR KURT RICHEBÄCHER

I had already put together a compilation of extracts on the impending
collapse of U.S. ruled capitalism and its mighty dollar, when I received
an
E-mail from folk singer Maireid Sullivan with a piece on The Looming
Dollar
Disaster by Dr Kurt Richebächer, the respected international banker,
economist and author. I want to include excerpts and do not want to hold
up
posting the improved E-letter while I get the source references; if you
want
that information and/or the complete piece, please write to Maireid
direct -
maireid@optusnet.com.au .

Here are the excerpts that I want to share:

   - - - irrespective of the stock market's slide, official mantra and
public opinion in America remain in flat denial of the tremendous
dislocations that the egregious credit excesses of the past several
years have inflicted on the U.S. economy and its financial system.

   - - - Careful analysis of the potential destructive forces suggests
that
when the dollar's plunge develops in earnest, it will - in contrast to
its
steep decline in the 1980s - be brutal for the U.S. financial markets,
which have become hostage to massive foreign capital inflows.

    For a long time, we have been warning that the dollar's strength is
pure
bubble strength. Gross illusions about the U.S. economy's health and
strength have for a few years engendered capital inflows of fantastic
but
unsustainable scale. Like all bubbles, it is bound to burst. The
collapsing
dollar will spell doom for the U.S. financial markets, both bonds and
shares. In fact, such a collapse is the single greatest risk for the
world
economy.

   - - - For us, in fact, the developing bust of the U.S. bubble economy
has
only two comparable precedents in history. One is the American
bubble-and-bust experience of the 1920-30s, and the other is Japan's
equivalent experience since the late 1980s.

   Yet, despite many similarities, there is one difference of supreme
importance between America's present imbroglio and those two earlier
episodes. In the 1920s, America was the world's leading creditor country

running a chronic surplus in its current account, and the very same has
been
and remains true for today's Japan. The inherent implication for such
countries is a fundamentally strong currency, warranting full autonomy
for
monetary policy.

   This time, however, the U.S. economy is slumping against the backdrop
of
the most adverse external conditions. Today's United States is the
world's
greatest debtor country. It runs a preposterous, chronic current-account

deficit from which an ever more preposterous foreign indebtedness
accrues.
Intrinsically, the monetary policy of such a country is hostage to the
willingness of foreign investors and lenders to finance its spending
excesses. They may force it to raise interest rates even when the
economy is
in depression.

   Earlier we noted that the chronic U.S. annual trade gap and chronic
current U.S. capital outflows add up to around $900-1,000 billion,
needing accommodation through capital inflows. For us, it is a
compelling conclusion that future capital flows into the United States
are bound to fall considerably short of these outrageous sums. Never
before has a deficit country also sent such massive amounts of capital
abroad for foreign investment. It is an unprecedented experience in
economic history. Manifestly, this is testament for extremely loose
money.

   Considering all circumstances, we think that an outright dollar
disaster, far worse than the crash in 1985-87, is inevitable.

--
3.
THE END OF EMPIRE BY WALTER GREIDER

William Greider, a prominent political journalist and author, and former

editor of Rolling Stones and the Washington Post, has written an
important
article, The End of Empire, in which he spells out how the growing trade

deficit will lead, inevitably, to the U.S. being stripped of its
imperial
delusions.

In the article, published in The Nation Magazine September 23 issue,
Greider
writes: "The US economy's net foreign indebtedness - the accumulation of
two
decades of running larger and larger trade deficits - will reach nearly
25
percent of US GDP this year, or roughly $2.5 trillion. Fifteen years
ago, it
was zero. Before America's net balance of foreign assets turned
negative, in
1988, the United States was a creditor nation itself, investing and
lending
vast capital to others, always more than it borrowed. Now the trend line

looks most alarming. If the deficits persist around the current level of

$400 billion a year or grow larger, the total US indebtedness should
reach
$3.5 trillion in three years or so. Within a decade, it would total 50
percent of GDP. Instead of facing this darkening prospect, Bush and team

regularly dismiss the worldviews of these creditor nations and lecture
them
condescendingly on our superior qualities. Any profligate debtor who
insults
his banker is unwise, to put it mildly."

Here is a further excerpt from the article, which can be read in full at

http://www.thenation.com/doc.mhtml?i=20020923&s=greider :

   - - - US ambitions to run the world . . . are heavily mortgaged. Like
any
debtor who borrows more year after year with no plausible way to reverse
the
trend, a nation sinking deeper into debt enters into an adverse power
relationship with its creditors -- greater and greater dependency.

   - - - For their own reasons, the major trading partners are reluctant
to
disrupt the status quo. The current arrangement allows them to have it
both
ways -- gaining a greater share of markets under the shadow of US
hegemony.
Privately, they recognize that the US economic position is steadily
ebbing.
But it seems wiser to let the Americans keep their delusions for now.
The
space for self-interested maneuvering is much greater if the United
States
carries the burdens and costs alone. Despite occasional whining, Japan
and
Germany are not eager to claim a prominent share in global leadership
(both
once had a go at running the world and it ended badly). Far better to
prop
up the United States financially without forcing awareness of the
shifting
power.

   Their reluctance resembles the American attitude early in the last
century, when it was the ascendant economic power but did not wish to
become
a 'Great Power' itself, with responsibility for maintaining world order.

Instead, the United States propped up Britain for many years as the
failing
empire sank into unsustainable debt. British power was fundamentally
eclipsed in 1914, but the United States provided the financial nurture
to
keep it upright, as a kind of dummy leader in world affairs, until after

World War II. Washington decisively pulled the plug in 1956, when
Britain
(along with France and Israel) invaded Egypt to capture the nationalized

Suez Canal. It was the last gasp of British colonialism, and Washington
disapproved. By withholding an IMF loan to London, the United States
crashed
the pound, forced Britain to withdraw from war and its prime minister to

resign in disgrace. The Brits were finally relieved of their delusions.

   - - - The Bush warriors' reckless American unilateralism can only
hasten
the day when the creditors' conclude that they must assert their
leverage
over us, perhaps in order to defend peace and stability in the world.
How
will Americans react when they discover that 'U-S-A' is a lot less
muscular
than they were led to believe? - - -

--
4.
SECRET BLUEPRINT FOR U.S. GLOBAL DOMINATION

The recklessness of the Bush administration has been long-planned,
according
to reporter Neil Mackay in an article in The Sunday Herald (Scotland) on

September 15. He writes:

   A SECRET blueprint for US global domination reveals that President
Bush
and his cabinet were planning a premeditated attack on Iraq to secure
'regime change' even before he took power in January 2001.

   The blueprint, uncovered by the Sunday Herald, for the creation of a
'global Pax Americana' was drawn up for Dick Cheney (now vice-
president),
Donald Rumsfeld (defense secretary), Paul Wolfowitz (Rumsfeld's deputy),

George W Bush's younger brother Jeb and Lewis Libby (Cheney's chief of
staff). The document, entitled Rebuilding America's Defenses:
Strategies,
Forces And Resources For A New Century, was written in September 2000 by
the
neo-conservative think-tank Project for the New American Century (PNAC).

   The plan shows Bush's cabinet intended to take military control of
the
Gulf region whether or not Saddam Hussein was in power. It says: "The
United
States has for decades sought to play a more permanent role in Gulf
regional
security. While the unresolved conflict with Iraq provides the immediate

justification, the need for a substantial American force presence in the

Gulf transcends the issue of the regime of Saddam Hussein."

   The PNAC document supports a "blueprint for maintaining global US
pre-eminence, precluding the rise of a great power rival, and shaping
the
international security order in line with American principles and
interests"
.

   This 'American grand strategy' must be advanced for "as far into the
future as possible", the report says. It also calls for the US to "fight
and
decisively win multiple, simultaneous major theatre wars" as a 'core
mission
'.

   The report describes American armed forces abroad as "the cavalry on
the
new American frontier". The PNAC blueprint supports an earlier document
written by Wolfowitz and Libby that said the US must "discourage
advanced
industrial nations from challenging our leadership or even aspiring to a

larger regional or global role".

For the rest of the article, go to
http://disc.server.com/discussion.cgi?id=149495;article=33142

--
5.
RUSSIAN COMMENTS ON SITUATION SINCE 9.11

In a recent round table discussion organised by the Russian
intelligence-linked weekly 'Zavtra', the renowned television commentator

Michael Leontyev, who is close to 'Russian oligarch' interests, opined
that
the economic and social crises in the U.S. "reminds us of the crisis of
the
Soviet Union at the beginning of the 1980s."

Leonid Shebarshin, a former high-level KGB official, supported this
view. He
thinks the U.S. might "stumble" in its attack on Iraq, and this could be
the
beginning of a total collapse. "Everything could disintegrate, just as
the
Soviet Union disintegrated, when in just four days, the whole state
ceased
to exist."

The five men participating in the round table discussion on the world
situation since 9.11 seemed to be agreed, in the words of strategic
analyst
General Leonard Ivashov, that "September 11 was an internal operation in
the
United States."

"It is necessary to recognize two forces operating in the U.S that have
two
different conceptions on using the military power of the U.S. to create
a
world empire," General Ivashov argued. "The first... wants the U.S. as a

powerful nation. The second, the world financial elite ... considers
that
the U.S. must be subjugated to the world empire, whose time has come....
It
is not an accident that many Western commentators speak of Sept 11 as an

attempted coup d'etat... The force that gave the order [for the
attacks], I
believe, is connected with the world financial mafias, having
representatives in the power structures of the USA, including the
intelligence and special
services. It is also no accident, that parallel with the investigation
of
the Sept. 11 attack, investigations are going on concerning the
activities
of a number of other structures, including the Mossad, within the U.S.
intelligence community.... I believe the ongoing events in the U.S. will

develop out of the conflict between these two forces."

   "What unites them, is the necessity to use the military power of the
U.S.
to crash down the boundaries of sovereign states.... Why the hurry?
Because,
firstly, China is growing, secondly, the Arab occident is consolidating
itself, thirdly, a rather powerful development is going on in Southeast
Asia. Russia's position is very unclear....

   "The present state of Russia satisfies these U.S. interests, but what

will be tomorrow, is not clear.... Thus, the U.S. is now at a transition

point. She has come to the climax of her military-power adventures for
grabbing power over the planet. I think this peak will be crossed in 1
1/2
to 2 years, after which the USA will retract from its positions as a
result
of economic problems. I think the attack on Iraq will occur. I think
Iran
will be drawn into the confrontation, and it should not be excluded,
that
Israel will participate.... After that, U.S.  policy will disintegrate
under
the influence of the economic and social-political collapse inside the
U.S..
One has the feeling, that the financial oligarchy in power on this
planet
are not interested in maintaining the U.S. population at its present
living
standard." - - -

A fuller transcript of the discussion between the Russian commentators
can
be had from Angie Carlson - angie1@planetsos.com. See also
http://english.pravda.ru for Russian attitudes to world developments.
________________________
This E-letter is posted at
http://www.whatmatters.nu/wmemails/wmemails20.html#WM-99

** The What Matters Programme is an initiative by Boudewijn Wegerif, to
spread information about what is happening in the world today, and how
things could be, given a schooling at all levels to free the self and
the
world from debt/guilt oppression and money madness - a schooling for
love.
The trustees of the What Matters Programme are the collegiate of
Folkhögskola Vårdinge By, an adult education residential college south
of
Stockholm.

You can read WHAT MATTERS E-letters 1-99 at the WHAT MATTERS web site -
http://www.whatmatters.nu/wmemails/wmemailsindex.html

To subscribe or unsubscribe to the WHAT MATTERS E-letters:
http://www.whatmatters.nu/contacts.html or write direct to me at
wegerif@connectit.co.za







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