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Tuesday, May 08, 2012

Why Austerity and Democracy can't mix

Key: Europe shows zero Budget wisdom
Prime Minister John Key says elections in Europe show the National-led Government is right to hand down another zero Budget this year, despite rising unemployment.

Im' sorry, was John Key drunk in this interview? Let me see if I can get this straight, John Key believes the rejection of austerity politics in Europe proves the austerity politics he has engaged in are correct???

I love when our Prime Minister gives an answer so stupid, that even the normally loving mainstream media go dead quiet. It happened when John claimed the Police had plenty of times on their hands to investigate his complaint, it happened when John said he was standing up for the principle of not being secretly recorded after passing retrospective legislation allowing the Police to do just that, it happened when John did that cannibalism joke about Tuhoe, it happened when John pretended to be camp and minced down a cat walk, it happened when Key claimed releasing the Epsom tea party tapes could lead to more teenagers committing suicide and it happened when Key claimed the poor were to blame for being poor.

Actually it happens a lot. John has a long history in a short 4 years of saying something so mind bendingly stupid you actually pity this detached multi-millionaire. His utterance that France's electoral defeat of austerity proves he's doing the right thing by implementing austerity has all the credibility of a teenage male claiming he buys porn magazines for the articles.

Free Market John doesn't want to know it yet, but we're all French Keynesians now.

What is the promise of democracy? The reason we all fought for democracy over fascism and communism is all because the basic promise of democracy has more pulling power for individuals than any other political structure.

The promise of democracy is that you can look into the face of your child and know that child will get a better deal of it than you received. This promise sums up all the genuine aspirational elements of democracy, no one wants to hear that they're kid will get a worse shot than you gained, where is the hope in that?

What the austerity demanders do not understand is that humans require hope to live, and that voters won't accept decade after decade of more austerity to pay off the debt created by a corporate financial elite who threw the planet into global meltdown because of their own venal, evil greed. What many forget about Greece is the role Goldman Sachs had in helping the Greeks hide their debt while actively betting against the Greek economy.

Key is a government with a microscopic g kinda guy. He is amputating the States ability to raise tax from the rich to justify further austerity to the social infrastructure while hocking off our assets to give South Island farmers subsidized irrigation. This game works as long as his wave and smile vacant optimism keeps the sleepy hobbits blissfully unaware, but if the sleepy hobbits get a whiff that there is no reprieve from his austerity agenda meaning there is no hope, then National are in danger of losing hearts while losing minds.

I say losing minds because there is plenty of material out there pointing out that front-loaded fiscal austerity makes periphery recessions more severe and undermines debt sustainability.

Key can only avoid this scrutiny by banging on about the debt bogey man, but even this tactic has problems. Cullen did what any good Government does in boom time, he paid down the debt, our problem is the private debt 30 years of user pays philosophy has created. Right wing Governments have reneged on their social obligations of education and livable minimum wages and shifted the debt to the individual, now the right want to point to that massive private debt legacy and use that to justify even harsher cut backs!

It wasn't until the late 1930's that the real economic and social impact of the 1929 stock collapse hit their peak. We are in our 4th year of our deepening depression. Implementing more failed free market doctrine to counter a global economic meltdown caused by that very same failed free market doctrine is the very definition of insanity.

Austerity and Democracy do not mix. Citizens won't replace the promise of democracy for a decade of austerity, especially when it was unregulated free market madness that allowed that corporate greed to necessitate the austerity in the first place.

The first NZ politician who can articulate that injustice will win hearts and minds and the election.



At 8/5/12 8:31 am, Blogger Tim said...

FINALLY! someone's beginning to realise that the guy basically isn't that bright! He lives and is driven by an ideology and his responses and actions only ever conform to that ideology. His 'craft' has be learned parrot-fashion - no ability for critical thinking.
If this happens, then do that. If that happens then do this. When it comes to something unfamiliar or out of the ordinary - he fcuks up everytime. There's even a whole language to go with it (going forward). Just look at Pike River (I thought he was going to do "WHATEVER IT TAKES"); or Christchurch ffs. God forbid his mate Stevie should fall under a bus - hed be at a total loss

At 8/5/12 12:28 pm, Blogger Nitrium said...

Free Market John doesn't want to know it yet, but we're all French Keynesians now.

God help us, if that is really the case. And I don't even believe in God.
What you are going to discover (presumably to your utter horror), is that Keynesian economics doesn't in fact hold any answers to the financial crisis we are currently in. Everyone keeps forgetting that the money for Government spending MUST come from somewhere, i.e. government spending MUST originate from economic SURPLUS. You seriously can't create surplus money out of thin air, and expect that it will magically hold its purchasing power. Deficit spending leads to rampant inflation. It has to, because deficit spending increases the money supply. So the very people who you naively think you are helping with the deficit dollars are simultaneously being corn-holed by the inflation that must accompany it. Inflation they can ill afford. Further, the notion that deficit spending "creates jobs" is patently absurd. Employment has not tangibly recovered because government is actually REPRESSING employment by running fiscal deficits that must sooner or later be funded. That funding must eventually come from the people (i.e. you, me, companies etc) and business owners know this. That means their sales and thus profits MUST eventually contract and until the conditions on that adjustment are known to them they'd be fools to hire anyone.
Keynesian economics can only work if it implemented as originally described by Keynes. i.e. you RAISE TAXES and CUT SPENDING during boom years to deliberately slow down the economy and also create a slush fund for the bust that inevitably follows. We have always done EXACTLY the opposite (the left increases spending, while the right cuts taxes during the boom). You can't champion Keynesian economic policy only 50% of the time!

At 8/5/12 2:23 pm, Blogger Frank said...

"The reason we all fought for democracy over fascism and communism is all because the basic promise of democracy has more pulling power for individuals than any other political structure. "

Nailed it.

Having lived in a Soviet satellite-state, in neo-liberal New Zealand, it is scary how similar the two systems are; both are disempowering; demand total obedience to dogma; and ignore the realities of human nature.

Human being are individuals - but are also a social species. Any political system that doesn't get that, is doomed to fail.

John Key doesn't get it. Neither did ACT, the 1 Percent Party.


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