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Arabica Robusta

There's no need for all this economic sadomasochism | David Graeber | Comment is free |... - 0 views

www.guardian.co.uk/...eed-for-economic-sadomasochism

adjustment economic structural neoclassical theory crisis social neoliberalism debt graeber rogoff reinhart

shared by Arabica Robusta on 23 Apr 13 - No Cached
  • Will we, then, see a reversal of policy? A sea of mea culpas from politicians who have spent the last few years telling disabled pensioners to give up their bus passes and poor students to forgo college, all on the basis of a mistake? It seems unlikely. After all, as I and many others have long argued, austerity was never really an economic policy: ultimately, it was always about morality.
  • We are talking about a politics of crime and punishment, sin and atonement.
  • But in a larger sense, the message was that we were guilty of having dreamed of social security, humane working conditions, pensions, social and economic democracy.
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  • If ever proof was required that the theory is selected to suit the politics, one need only consider the reaction politicians have to economists who dare suggest this moralistic framework is unnecessary; or that there might be solutions that don't involve widespread human suffering.
  • the vicious cycle of austerity. As a larger percentage of government spending has to be redirected to paying rising interest rates, budgets are slashed, workers fired, the economy shrinks, and so does the tax base, further reducing government revenues and further increasing the danger of default.
Arabica Robusta

Transnational Institute | Africa: Chilling the Arab Spring - 0 views

www.tni.org/...africa-chilling-arab-spring

economic adjustment crisis neoclassical structural theory

shared by Arabica Robusta on 19 Jun 11 - No Cached
  • If the IMF leadership praised the dictatorship, insisted on austerity and advocated squeezing poor people for more taxes, what business does it have today in giving similar advice to Tunisia, or anywhere in the Middle East and North Africa, or for that matter Europe or anywhere at all? What can we learn about IMF thinking in Tunisia, Egypt and Libya, as well as Palestine?
  • In contrast, there was no IMF conditionality aimed at reforming the dictatorship and halting widespread corruption by Ben Ali and his wife's notorious Trabelsi family, or lessening the two families' extreme level of business concentration, or ending the regime's reliance upon murderous security forces to defend Tunisian crony capitalism, or lowering the hedonism for which Ben Ali had become famous.
  • In addition to expanding Public Private Partnerships (PPPs, a euphemism for services privatization and outsourcing), the IMF named its priorities: "adopting as early as possible a full-fledged VAT, complementing energy subsidy reform with better-targeted transfers to the most needy, and containing the fiscal cost of the pension and health reforms."
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  • Resuming privatization and increasing the role of carefully structured and appropriately priced PPPs should assist fiscal adjustment and mobilize private resources for infrastructure investment.
  • In that document, IMF staff worried that "managing popular expectations and providing some short-term relief measures will be essential to maintain social cohesion in the short term," and that this would come at a price: "external and fiscal financing gaps of US$9-12 billion... which would need to be filled with exceptional support from Egypt's multilateral and bilateral development partners, particularly given the limited scope for adjustment in the short term."
  • As Adam Hanieh from London's School of Oriental and African Studies concluded just after the G8 summit and allied Arab states pledged $15 billion to Egypt, The plethora of aid and investment initiatives advanced by the leading powers in recent days represents a conscious attempt to consolidate and reinforce the power of Egypt's dominant class in the face of the ongoing popular mobilizations. They are part of, in other words, a sustained effort to restrain the revolution within the bounds of an "orderly transition" - to borrow the perspicacious phrase that the U.S. government repeatedly used following the ousting of Mubarak.
  • If successful, the likely outcome of this - particularly in the face of heightened political mobilization and the unfulfilled expectations of the Egyptian people - is a society that at a superficial level takes some limited appearances of the form of liberal democracy but, in actuality, remains a highly authoritarian neoliberal state dominated by an alliance of the military and business elites.[10]
  • They welcomed Libya's strong macroeconomic performance and the progress on enhancing the role of the private sector and supporting growth in the non-oil economy. The fiscal and external balances remain in substantial surplus and are expected to strengthen further over the medium term, and the outlook for Libya's economy remains favorable (emphasis added).[12]
  • The fund's mission to Tripoli had somehow omitted to check whether the "ambitious" reform agenda was based on any kind of popular support. Libya is not an isolated case. And the IMF doesn't look good after it gave glowing reviews to many of the countries shaken by popular revolts in recent weeks.[13]
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