H/t Theo Moudakis
Meanwhile, for those made of sterner stuff, there is an insightful analysis by Larry Kazdan of Vancouver of what should truly frighten all of us:
Today’s unemployment rate of 5.5 per cent may be considered “rock bottom,” but unemployment after the Second World War until the mid-1950s averaged less than 3 per cent. However, the rise of neo-liberalism in the 1980s coincided with the normalization of higher unemployment rates. Fiscal and monetary settings that led to more jobless and new laws relating to minimum wages and labour standards, union organizing and strike rules, and import of foreign workers, all combined to reduce pressure on wages.
The link between higher productivity and concurrent wage gains was broken, and consequently more profits accrued to capital.
The suppression of wages had another benefit, since workers could be enticed to borrow in order to maintain lifestyles, leading to another source of increased profits for the financial industry. And indebted workers in a tepid economy are fearful of leaving their jobs since replacements may be hard to find.
Affordability worries today are by no means the result of the boom-bust nature of Canada’s economy or other factors beyond the control of politicians. On the contrary, the squeeze on working and middle class families was carefully engineered by Conservative and Liberal governments to benefit the economic elites which they represent.
That, of course, would be outright treachery which is probably another facet of neoliberalism. What we failed to understand when Reagan, Thatcher and even Mulroney ushered in this Keynesian-killing economic ideology was how it degraded national sovereignty and the bond between the public and those they installed in power.
ReplyDeleteWe invited a new player into our body politic and shared critical incidents of sovereignty with this newcomer all in the name of globalized free trade and the "new economy." Once this corporate/financial/commercial juggernaut was empowered it gradually insinuated itself between the public and their elected representatives.
In the US this led to a "bought and paid for Congress" that was soon followed by "regulatory capture" by which regulated industries were able to stack boards and tribunals with industry representatives (the NEB in Canada). Organizations such as the American Legislative Exchange Council (ALEC) openly summoned both federal and state legislators to their gatherings where they would be handed draft bills to take back to their chambers and transform into laws. Deregulation ensued. Cheap money became a means to fleece the public. Liar loans, bundled mortgages, an unregulated and blindingly overheated real estate market created an era of ersatz prosperity that, on its collapse, sucked the lifeblood out of the blue and white collar working classes. The market crashed but out of the ashes emerged a gaggle of billionaires who had orchestrated the disaster. Governments, meanwhile, had to bail out the collaborators, the banks, that processed the scams. And NO ONE went to jail, such is the hold this commercial sector had over government. Another Minsky cycle, eclipsing any previous boom, ended but much more painfully.
When it hit all the conservative Quislings - from Bush to Harper - tried to distance themselves, saying that "no one saw it coming." An outright lie. Nouriel Roubini saw it coming. Joe Stiglitz warned it was coming. Paul Krugman wrote a book, "The Great Unraveling," three years before the Great Recession hit. The free-enterprise conservatives paid them not the slightest heed. Harper, for example, authorized no money down, 40-year term mortgages just as the recession hit. His tardiness alone saved Canada from a financial disaster.
Do you sense this makes my blood boil? I could go on but I won't.
I know you have written extensively on neoliberalism, Mound, and your knowledge is vast compared to mine. From my perspective, the greatest mistake Canadians made in the last four years was believing Trudeau was cut from a different cloth. Time has, of course, proven that to be a massive delusion.
DeleteAll true. The problem is that neo-liberalism has become normal. For most of us, it is as natural as breathing.
ReplyDeleteNeoliberalism has been presented to everyone as the answer to the world's problems, Owen. The truth is, it has only added to them.
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