Underlying the sudden, volatile uprising in Egypt and Tunisia is a growing global crisis sparked by soaring food prices and unemployment. The Associated Press reports that roughly 40 percent of Egyptians struggle along at the World Bank-set poverty level of under $2 per day. Analysts estimate that food price inflation in Egypt is currently at an unsustainable 17 percent yearly. In poorer countries, as much as 60 to 80 percent of people's incomes go for food, compared to just 10 to 20 percent in industrial countries. An increase of a dollar or so in the cost of a gallon of milk or a loaf of bread for Americans can mean starvation for people in Egypt and other poor countries.
The cause of the recent jump in global food prices remains a matter of debate. Some analysts blame the Federal Reserve's "quantitative easing" program (increasing the money supply with credit created with accounting entries), which they warn is sparking hyperinflation. Too much money chasing too few goods is the classic explanation for rising prices.
The problem with that theory is that the global money supply has actually shrunk since 2006, when food prices began their dramatic rise. Virtually all money today is created on the books of banks as "credit" or "debt," and overall lending has shrunk. This has occurred in an accelerating process of deleveraging (paying down or writing off loans and not making new ones), as the subprime housing market has collapsed and bank capital requirements have been raised. Although it seems counterintuitive, the more debt there is, the more money there is in the system. As debt shrinks, the money supply shrinks in tandem.
That is why government debt today is not actually the bugaboo it is being made out to be by the deficit terrorists. The flipside of debt is credit, and businesses run on it. When credit collapses, trade collapses. When private debt shrinks, public debt must therefore step in to replace it. The "good" credit or debt is the kind used for building infrastructure and other productive capacity, increasing the Gross Domestic Product (GDP) and wages; and this is the kind governments are in a position to employ. The parasitic forms of credit or debt are the gamblers' money-making-money schemes, which add nothing to GDP.
Prices have been driven up by too much money chasing too few goods, but the money is chasing only certain selected goods. Food and fuel prices are up, but housing prices are down. The net result is that overall price inflation remains low...
So poor people who no longer grow their own food, thanks to flat earth globalization, you know, starve. Globally.
That's why the middle east is aflame, not, as some DINOcrat idiots claim, because of the need for democracy against ruthless leaders, nor, as some Reptilian idiots claim, because of Islamist agitation against "our" friends. Or as yet some other idiots claim, socialist tendencies against the free market.
There is nothing free about the global market, and what's going on globally isn't capitalism.
One way feudal lords controlled people was to keep them in debt to their masters, so thralldom was maintained by the specter of hunger.
That's what the revolts are all about. That's why Washington is so unnerved. That's why even now the Company is probably doing it's best to re-cast the struggle according to tried and true stereotypes. You can count on fundamentalist muslims being imported and bankrolled, through subsidiaries and proxies, to make this the kind of battle play out the way that gets high ratings in the Village and mindless support from the Faithful in the West.
No comments:
Post a Comment