Obama’s Dumbest Plan Yet: Neo-Nazi Coup in Ukraine

by MIKE WHITNEY

“Washington and Brussels … used a Nazi coup, carried out by insurgents, terrorists and politicians of Euromaidan to serve the geopolitical interests of the West.”
– Natalia Vitrenko, The Progressive Socialist Party of Ukraine

The United States helped defeat Nazism in World War 2. Obama helped bring it back.

As you probably know by now, Obama and Co. have ousted Ukraine’s democratically-elected president, Viktor Yanukovych, with the help of ultra-right, paramilitary, neo-Nazi gangs who seized and burned government offices, killed riot police, and spread mayhem and terror across the country. These are America’s new allies in the Great Game, the grand plan to “pivot to Asia” by pushing further eastward, toppling peaceful governments, securing vital pipeline corridors, accessing scarce oil and natural gas reserves and dismantling the Russian Federation consistent with the strategy proposed by geopolitical mastermind, Zbigniew Brzezinski. Brzezinski’s magnum opus–”The Grand Chessboard: American Primacy and it’s Geostrategic Imperatives” has become the Mein Kampf for aspiring western imperialists. It provides the basic blueprint for establishing US military-political-economic hegemony in the century’s most promising and prosperous region, Asia. In an article in Foreign Affairs Brzezinski laid out his ideas about neutralizing Russia by splitting the country into smaller parts, thus, allowing the US to maintain its dominant role in the region without threat of challenge or interference. Here’s an excerpt from the article:

“Given (Russia’s) size and diversity, a decentralized political system and free-market economics would be most likely to unleash the creative potential of the Russian people and Russia’s vast natural resources. A loosely confederated Russia — composed of a European Russia, a Siberian Republic, and a Far Eastern Republic — would also find it easier to cultivate closer economic relations with its neighbors. Each of the confederated entitles would be able to tap its local creative potential, stifled for centuries by Moscow’s heavy bureaucratic hand. In turn, a decentralized Russia would be less susceptible to imperial mobilization.” (Zbigniew Brzezinski,“A Geostrategy for Eurasia”)

Moscow is keenly aware of Washington’s divide and conquer strategy, but has downplayed the issue in order to avoid a confrontation. The US-backed coup in Ukraine means that that option is no longer feasible. Russia will have to respond to a provocation that threatens both its security and vital interests. Early reports suggest that Putin has already mobilized troops to the East and –according to Reuters “put fighter jets along its western borders on combat alert.” Here’s more from Reuters:

“The United States says any Russian military action would be a grave mistake. But Russia’s foreign ministry said in a statement that Moscow would defend the rights of its compatriots and react without compromise to any violation of those rights.” (Reuters)

There’s going to be a confrontation, it’s just a matter of whether the fighting will escalate or not.
In order to topple Yanukovych, the US had to tacitly support fanatical groups of neo-Nazi thugs and anti-Semites. And, even though “Interim Ukrainian President Oleksander Tuchynov has pledged to do everything in his power to protect the country’s Jewish community”; reports on the ground are not so encouraging. Here’s an excerpt from a statement by Natalia Vitrenko, of The Progressive Socialist Party of Ukraine that suggests the situation is much worse than what is being reported in the news:

“Across the country… People are being beaten and stoned, while undesirable members of the Verkhovna Rada of Ukraine are subject to mass intimidation and local officials see their families and children targeted by death threats if they do not support the installation of this new political power. The new Ukrainian authorities are massively burning the offices of political parties they do not like, and have publicly announced the threat of criminal prosecution and prohibition of political parties and public organizations that do not share the ideology and goals of the new regime.” (“USA and EU Are Erecting a Nazi Regime on Ukrainian Territory”, Natalia Vitrenko)

Earlier in the week, Israeli newspaper Haaretz reported that a Ukranian synagogue had been firebombed although the “Molotov cocktails struck the synagogue’s exterior stone walls and caused little damage”.
Another article in Haaretz referred to recent developments as “the new dilemma for Jews in Ukraine”. Here’s an excerpt from the article:

“The greatest worry now is not the uptick in anti-Semitic incidents but the major presence of ultra-nationalist movements, especially the prominence of the Svoboda party and Pravy Sektor (right sector) members among the demonstrators. Many of them are calling their political opponents “Zhids” and flying flags with neo-Nazi symbols. There have also been reports, from reliable sources, of these movements distributing freshly translated editions of Mein Kampf and the Protocols of the Elders of Zion in Independence Square.” (“Anti-Semitism, though a real threat, is being used by the Kremlin as a political football”, Haaretz)

Then there’s this, from Dr. Inna Rogatchi in Arutz Sheva:

“There is no secret concerning the real political agenda and programs of ultra-nationalist parties in Ukraine – there is nothing close to European values and goals there. One just should open existing documents and hear what the representatives of those parties proclaim daily. They are sharply anti-European, and highly racist. They have nothing to do with the values and practices of the civilized world…
Ukrainian Jewry is facing a real and serious threat….To empower the openly neo-Nazi movements in Europe by ignoring the threat they pose is an utterly risky business. People should not have to pay a terrible price – again – for the meekness and indifference of their leaders. As Ukraine today has become the tragic show-case for all of Europe with regards to breeding and allowing race-hatred to become a violent and uncontrollable force, it is impertive to handle the situation there in accordance with existing international law and norms of civilization.” (“Tea With Neo-Nazis: The Violent Nationalism in Ukraine“, Arutz Sheva)

Here’s a little more background on the topic by progressive analyst Stephen Lendmen from a February 25 post titled “New York Times: Supporting US Imperial Lawlessness”:

“Washington openly backs fascist Svoboda party leader Oleh Tyahnybok…In 2004, Tyahnybok was expelled from former President Viktor Yushchenko’s parliamentary faction. He was condemned for urging Ukrainians to fight against a “Muscovite-Jewish mafia.”
In 2005, he denounced “criminal activities” of “organized Jewry.” He outrageously claimed they plan “genocide” against Ukrainians.”…
Tyahnybok extremism didn’t deter Assistant Secretary of State for European and Eurasian Affairs Victoria Nuland. On February 6, she met openly with him and other anti-government leaders.
In early January, 15,000 ultranationalists held a torchlight march through Kiev. They did so to honor Nazi-era collaborator/mass murderer Stepan Bandera. Some wore uniforms a Wehrmacht Ukrainian division used in WW II. Others chanted “Ukraine above all” and “Bandera, come and bring order.” (Steve Lendman blog)

Of course, the US media has downplayed the fascistic-neo-Nazi “ethnic purity” element of the Ukrainian coup in order to focus on– what they think — are more “positive themes”, like the knocking down of statues of Lenin or banning Communist party members from participating in Parliament. As far as the media is concerned, these are all signs of progress.

Ukraine is gradually succumbing to the loving embrace of the New World Order where it will serve as another profit-generating cog in Wall Street’s wheel. That’s the theory, at least. It hasn’t occurred to the boneheads at the New York Times or Washington Post that Ukraine is rapidly descending into Mad Max-type anarchy which could spill over its borders into neighboring countries triggering violent conflagrations, social upheaval, regional instability or–god-help-us– WW3. The MSM sees nothing but silver linings as if everything was going according to plan. All of Eurasia, the Middle East and beyond are being pacified and integrated into one world government overseen by the unitary executive who defers to no one but the corporations and financial institutions who control the levers of power behind imperial shoji-screen.

What could go wrong?

Naturally, Russia is worried about developments in Ukraine, but is unsure how to react. Here’s how Russian PM Dmitry Medvedev summed it up the other day:

“We do not understand what is going on there. A real threat to our interests (exists) and to the lives and health of our citizens. Strictly speaking, today there is no one there to communicate with … If you think that people in black masks waving Kalashnikovs (represent) a government, then it will be difficult for us to work with such a government.”

Clearly, Moscow is confused and worried. No one expects the world’s only superpower to behave this irrationally, to hop-scotch across the planet creating one failed state after another, fomenting revolt, breeding hatred, and spreading misery wherever it goes. At present, the Obama team is operating at full-throttle trying to topple regimes in Syria, Venezuela, Ukraine, and god-knows where else. At the same time, failed operations in Afghanistan, Iraq and Libya have left all three countries in dire straights, ruled by regional warlords and armed militias. Medvedev has every right to be concerned.

Who wouldn’t be? The US has gone off the rails, stark raving mad. The architecture for global security has collapsed while the basic principals of international law have been jettisoned. The rampaging US juggernaut lurches from one violent confrontation to the next without rhyme or reason, destroying everything in its path, forcing millions to flee their own countries, and pushing the world closer to the abyss. Isn’t that reason enough to be concerned?

Now Obama has thrown-in with the Nazis. It’s just the icing on the cake.

Check out this blurb from Max Blumenthal’s latest titled “Is the U.S. Backing Neo-Nazis in Ukraine?”:

“Right Sector is a shadowy syndicate of self-described ‘autonomous nationalists’ identified by their skinhead style of dress, ascetic lifestyle, and fascination with street violence. Armed with riot shields and clubs, the group’s cadres have manned the front lines of the Euromaidan battles this month, filling the air with their signature chant: ‘Ukraine above all!’ In a recent Right Sector propaganda video the group promised to fight ‘against degeneration and totalitarian liberalism, for traditional national morality and family values.’
With Svoboda linked to a constellation of international neo-fascist parties through the Alliance of European National Movements, Right Sector is promising to lead its army of aimless, disillusioned young men on “a great European Reconquest.” (“Is the U.S. Backing Neo-Nazis in Ukraine?—Exposing troubling ties in the U.S. to overt Nazi and fascist protesters in Ukraine“, Max Blumenthal, AlterNet)

“Family values”? Where have we heard that before?

It’s clear, that Obama and his brainiac advisors think they have a handle on this thing and can train this den of vipers to click their heels and follow Washington’s directives, but it sounds like a bad bet to me. These are hard-core, died-in-the-wool, Nazi-extremists. They won’t be bought-off, co-opted or intimidated. They have an agenda and they aim to pursue that agenda to their last, dying breath.

Of all the dumb plans Washington has come up with in the couple years, this is the dumbest.

The Greatest Debt Crisis The World Has Ever Seen Is Coming

September 17th, 2013

By Michael Snyder

The largest mountain of debt in the history of the world just continues to grow even larger, and everyone knows that this colossal debt spiral is not going to end well. But we all keep playing along because nobody wants the party to end. Right now, there is an unprecedented ocean of red ink covering the planet. Globally, governments have never been in so much debt, corporations have never been in so much debt and consumers have never been in so much debt. But every time someone suggests that this is a problem and that we should at least try to get debt levels to settle down a bit, people start screaming that “austerity” will hurt the global economy. And of course it will. But we can’t continue to live way, way above our means indefinitely. Well, we can try, but at some point this entire house of cards is going to come crashing down and we are going to be facing the greatest economic crisis the world has ever seen.

It is kind of like watching a slow-motion train wreck that you have no chance of possibly stopping that you know will end up killing lots of innocent people. This debt crisis is going to end up destroying the global financial system, but there is not a thing that you or I can do to prevent it from happening. The unprecedented debt binge that we are witnessing right now is going to continue until someday we hit a brick wall of financial disaster. We can yell and we can scream, but it isn’t going to stop what is happening.

As the Telegraph recently noted, even the Bank for International Settlements is warning that debt levels are way too high. According to the BIS, total public and private debt levels are now 30 percent higher than they were in 2008…

“This looks like to me like 2007 all over again, but even worse,” said William White, the BIS’s former chief economist, famous for flagging the wild behavior in the debt markets before the global storm hit in 2008.

“All the previous imbalances are still there. Total public and private debt levels are 30pc higher as a share of GDP in the advanced economies than they were then, and we have added a whole new problem with bubbles in emerging markets that are ending in a boom-bust cycle,” said Mr White, now chairman of the OECD’s Economic Development and Review Committee.

The BIS can see the disaster coming, but even they have no chance of preventing it.

For the rest of this article, I am going to focus on government debt, but please keep in mind that corporate debt and consumer debt are also totally out of control globally. It would be very hard to overstate the nightmare that we are facing.

But of course national governments are the biggest offenders when it comes to debt…


Asia

Japan now has a debt to GDP ratio of more than 211 percent, and as Simon Black of the Sovereign Man blog recently detailed, they are rapidly heading toward a national financial meltdown…

Looking purely at the numbers, Japan’s medium-term fundamentals are among the bleakest in the world.

Total government debt amounts to over 200% of the country’s entire GDP– a figure so large that the Japanese government spends 51.5% of the 43 trillion yen ($430 billion) they collect in tax revenue just to pay interest!

Perhaps even more astounding is that ‘primary balance expenses,’ i.e. normal government expenditures, totaled 70.3 trillion yen, or 163% of tax revenue.

The only way they’ve managed to stay afloat is by issuing more debt, which makes the problem even worse. In fact, 46% of the 2013 budget is being financed by debt.

These guys are running out of rope. And fast.

China is facing a different sort of a problem. In that nation, the growth of private domestic debt is wildly out of control.

According to a recent World Bank report, private domestic debt in China has grown from 9 trillion dollars in 2008 to 23 trillion dollars today.

There is no way that is sustainable, and at some point that massive bubble is going to burst.


Europe

Even though some European nations have supposedly implemented “austerity measures” in recent years, debt levels continue to rise rapidly. The following are some numbers that were recently released which show that government debt to GDP ratios for some of the most financially troubled nations in Europe are absolutely soaring…

• Euroarea: 92.2%, up from 88.2% a year ago
• Greece: 160.5%, up from 136.5% a year ago
• Italy: 130.3%; up from 123.8% a year ago
• Portugal: 127.2%, up from 112.3% a year ago
• Ireland: 125.1%, up from 106.8% a year ago
• Spain: 88.2%, up from 73.0% a year ago
• Netherlands: 72.0%, up from 66.7% a year ago

Anyone that tells you that the crisis in Europe is “over” is lying to you. The debt crisis is getting worse, not better.




The United States

The biggest mountain of debt of all can be found in the United States.

30 years ago, the national debt was a little bit above a trillion dollars.

Today, it is rapidly approaching 17 trillion dollars.

At this point, the U.S. already has more government debt per capita than Greece, Portugal, Italy, Ireland or Spain. And since Barack Obama entered the White House, the debt to GDP level has soared to unprecedented heights…

Sadly, this is just the beginning.

One reason for this is that the U.S. is facing some tremendous demographic challenges in the years ahead.

In other words, our population is getting older.

It is being projected that the number of Americans on Social Security will rise from 57 million today to more than 100 million in 25 years.

How in the world are we possibly going to pay for that?

Already, we are very heavily dependent on foreigners to pay our bills.

According to the U.S. Treasury, foreigners hold approximately 5.6 trillion dollarsof our debt at this point.

China and Russia account for about one-fourth of that total. Right now, China owns approximately 1.275 trillion dollars of our debt, and Russia owns approximately 138 billion dollars of our debt.

So what would happen if we went to war with Syria and they decided to quit borrowing from us and they started dumping our debt instead?

That is a very good question.

And actually, according to Zero Hedge foreigners have already started to dump a little bit of our debt…

Today’s TIC data showed something disturbing: for the fourth month in a row, foreigners were net sellers of US Treasury paper in July, as total foreign holdings declined from $5.600 trillion to $5.590 trillion which represents 49% of total marketable debt (including the debt owned by the Fed of course). In other words, since peaking at $5.724 trillion in March, foreign-held debt has declined by $134 trillion, at a time when yields have surged on fears the Fed’s tapering of its own purchases of bonds will mean less Fed frontrunning opportunities.

We certainly cannot afford for that to continue, because we desperately need other nations to finance our reckless spending.

Our debt is wildly out of control, and the only way we can keep the entire system from collapsing is to go into even more debt.

As I noted recently, if the U.S. national debt was reduced to a stack of one dollar bills it would circle the earth at the equator 45 times.

That is a whole lot of money.

But most Americans do not consider it to be a problem because disaster has not struck yet.

Unfortunately, they simply don’t understand how quickly an exponential problem can overwhelm you. I think that the following illustration from Simon Black is particularly helpful…

Let’s say you’re at a party in a small apartment that’s about 500 square feet in size. Then suddenly, at 11pm, a pipe bursts, starting a trickle into the living room.

Aside from the petty annoyance, would you feel like you were in danger? Probably not. This is a linear problem– the rate at which the water is leaking is more or less constant, so the guests can keep partying through the night without worry.

But let’s assume that it’s an exponential leak.

At first, there’s just one drop of water. But each minute, the rate doubles. So by 11:01pm, there’s 2 drops. By 11:02, 4 drops. And so forth.

By 11:27pm, there’s only six inches of standing water. Yet by 11:31pm, just four minutes later, the entire room is under nearly 8 feet of water. And the party’s over.

For nearly half an hour, it all seemed safe and manageable.People had all the time in the world to leave, right up until the bitter end. 11:27, 11:28, 11:29. Then it all went from benign to deadly in a matter of minutes.

By the time that our politicians and the talking heads on the mainstream media admit that we have a debt emergency on our hands, it will probably be far, far too late.

The greatest debt crisis the world has ever seen is coming, and there is nothing that anyone can do to stop it.

But you can take measures to get prepared for it.

Please get prepared while you still can.

Unsurvivable - The Newest Thermonuclear War Threat taking place NOW

Obama's deployment of a major portion of the U.S. thermonuclear capabilities in multiple theaters threatening both Russia and China is basically daring them to respond in kind. If they do, that's it, game over. We are as close to nuclear annihilation as we've ever been, and we cheer for our demise so loud, we drown out any cries of dissent.

Nestlé Targets Developing Nations for Bottled Water, Infant Formula Sales

Wednesday, April 25, 2012 by Food & Water Watch Blogby Darcey Rakestraw


On Monday, Nestlé announced it had purchased Pfizer’s infant nutrition unit, which will strengthen their ability to sell infant formula in emerging markets, particularly in Asia. The move is not surprising, since 85 percent of Pfizer’s infant nutrition revenues came from developing countries, where Nestlé is also looking to expand its sales of bottled water.

How do we know this? Nestlé has declared both its Pure Life brand of bottled water and infant formula as Popularly Positioned Products (PPP) that target “less affluent consumers in emerging markets”. Two weeks ago, we mentioned Nestlé’s report outlining this strategy in this blog. For some reason, the report is no longer available on Nestlé’s site without the requisite log-in information. But we’ve reposted the document here.

Our executive director, Wenonah Hauter, released this statement in response to Nestlé’s purchase of Pfizer’s infant nutrition unit:

This renewed focus on growing the market for its infant formula products is troubling given the corporation’s track record of using dubious practices to market infant formula in developing countries, where it is often prepared in unhygienic conditions with unsafe water….Surely, it is no coincidence that many mothers will prepare the formula with bottled water—which will no doubt benefit Nestlé’s emerging market strategy. 

Selling bottled water to poor people, and pushing infant formula on poor but otherwise healthy mothers who may not have access to safe drinking water is doing what Nestlé does best: undermining public health in the name of profit.

For more on Nestlé’s plan to market bottled water in developing nations to offset the drop-off in sales from developed countries, read our report, Hanging on for Pure Life.

China Warns Obama on US Military Focus on Asia

Robert Dreyfuss on January 10, 2012 - The Nation

The Obama administration may want to build up its military presence in East Asia and the Pacific, but the Chinese have thoughts about it, too. The Washington Post carries an interview with Cui Tiankai, the deputy foreign minister in charge of relations with the United States.

Some quotes from Cui:

“Although different presidents have been in office, the China policy of the administrations has been fairly consistent. I see no reason we should disrupt or stop this trend.”

“The U.S. has the strongest military in the world and spends more than any other country,” Cui said. “But the U.S. always feels unsafe or insecure about other countries. I suggest the United States spend more time thinking about how to make other countries feel less worried about the United States.”

I couldn’t agree more. The Post added:

“Cui said that despite a few ‘hot-spot issues,’ the Asia-Pacific region was, on the whole, ‘stable and peaceful,’ and that Asian countries wanted to concentrate on their economic development. ‘I don’t think military alliances is what they need most.’"

Exactly.

Another Chinese official, Liu Weimin, a spokesman for the foreign ministry, also criticized the US strategic review:

“China’s strategic intent is clear, open and transparent. Our national defense modernization serves the objective requirements of national security and development and also plays an active role in maintaining regional peace and stability. It will not pose any threat to any country. The charges against China in this document are groundless and untrustworthy.”

And the defense ministry added, “The accusations leveled at China by the US side in this document are totally baseless.”

Not only that, but to underline its point, Beijing isn’t going along with plans to cut off Iran’s oil exports, either. Fact is, Obama needs China’s economic cooperation, above all, in partnership with the United States, to get the world economy back on track. And rather than bluster about “balancing” China in Asia, Washington should redouble efforts to work out a cooperation relationship with China that recognizes China’s real, and legitimate, national security interests.

The days of American hegemony are so twentieth century.

Recovery Recedes, Convulsion Looms

(If your life hasn't gotten more difficult, don't worry, it's coming. No one escapes because the recovery is bogus.--jef)

***

The Triumph of Austerity
By WALDEN BELLO

The dominant mood in liberal economic circles as 2010 drew to a close, in contrast to the cautiously optimistic forecasts about a sustained recovery at the end of 2009, was gloom, if not doom. Fiscal hawks have gained the upper hand in the policy struggle in the United States and Europe, to the alarm of spending advocates like Nobel laureate Paul Krugman and Financial Times columnist Martin Wolf who see budgetary tightening as a surefire prescription for killing the hesitant recovery in the major economies.

But even as the United States and Europe appear to be headed for deeper crisis in the short term and stagnation in the long term, East Asia and other developing areas show signs of decoupling from the western economies. This trend began in early 2009 on the strength of the massive Chinese stimulus program, which not only restored China to double-digit growth but swung several neighboring economies from Singapore to South Korea from recession to recovery. By 2010, Asia's industrial production had caught up with its historical trend, "almost as if the Great Recession never happened," as the Economist put it.

The United States, Europe, and Asia seem to be going their separate ways. Or are they?

In the major economies, outrage with the excesses of the financial institutions that precipitated the economic crisis has given way to concern about the massive deficits that governments incurred to stabilize the financial system, arrest the collapse of the real economy, and stave off unemployment. In the United States, the deficit stands at over nine percent of gross domestic product. This is hardly a runaway deficit, but the American right bellomanaged the feat of making the fear of the deficit and federal debt a greater force in the mind of the public than the fear of deepening stagnation and rising unemployment. In Britain and the United States, fiscal conservatives gained a clear electoral mandate in 2010 while in continental Europe, a more assertive Germany put the rest of the Eurozone on notice that it would no longer subsidize the deficits of the monetary union's weaker southern-tier economies such as Greece, Ireland, Spain, and Portugal.

In the United States, the logic of reason gave way to the logic of ideology. The Democrats' impeccable rationale that stimulus spending was necessary to save and create jobs was no match for the Republicans' heated message that more stimulus spending added to President Obama's $787 billion 2009 package would be one more step towards "socialism" and the "loss of individual freedom." In Europe, Keynesians argued that fiscal loosening would not only help the troubled economies of southern Europe and Ireland but also the powerful German economic machine itself since these economies absorbed German exports.

As in the United States, solid rationale lost out to provocative image, in this case, the media-disseminated portrayal of thrifty Germans subsidizing hedonistic Mediterraneans and spendthrift Irishmen. Germany has grudgingly approved bailout packages for Greece and Ireland, but only on condition that the Greeks and Irish are subjected to savage austerity programs that have been described by no less than two former high-ranking German ministers Frank-Walter Steinmeier and Peer Steinbrueck, writing in the Financial Times, as having a degree of social pain "unheard of in modern history."

Decoupling Revived

The triumph of austerity in the U.S. and Europe will surely eliminate these two areas as engines of recovery for the global economy. But is Asia indeed on a different track, one that would make it bear, like Atlas, the burden of global growth?

The idea that Asia's economic future had been decoupled from that of the center economies is not new. It was fashionable before the financial crisis dragged down the U.S. economy in 2007-2008. But it was shown to be a mirage as the recession in the United States, on which China and the other East Asian economies were dependent to absorb their exports, triggered a sudden and sharp downturn in Asia from late 2008 to mid-2009. This period produced television images of millions of Chinese migrant workers, laid off in coastal economic zones, heading back to the countryside.

To counter the contraction, a panicked China launched what Charles Dumas , author of Globalization Fractures, characterized as a "violent domestic stimulus" of 4 trillion yuan ($580 blllion). This came to about 13 percent of gross domestic product in 2008 and constituted "probably the largest such program in history, even including wars." The stimulus not only pulled China back to double-digit growth, it also pushed the East Asian economies that had become dependent on it to a steep recovery even as Europe and the United States stagnated. This remarkable reversal led to the renaissance of the decoupling idea.

The ruling Communist Party of China has reinforced this notion by claiming a fundamental policy shift to prioritizing domestic consumption over export-led growth. But this contention is more rhetorical than real. In fact, export-led growth remains the strategic thrust, thus China's continuing refusal to let the yuan appreciate in order to keep its exports competitive. China, as Dumas notes, is "in the process of shifting massively from the beneficial stimulation of domestic demand to something closely resembling business as usual, circa 2005-07: export-led growth with a bit of overheating."

Not only Western analysts like Dumas have pointed to this return to export-led growth. Yu Yongding, an influential technocrat who served on the monetary committee of China's central bank, confirms that it is indeed back to business as usual: "With China's trade-to-GDP ratio and exports-to-GDP ratio already respectively exceeding 60 percent and 30 percent, the economy cannot continue to depend on external demand to sustain growth. Unfortunately, with a large export sector that employs scores of millions of workers, this dependence has become structural. That means reducing China's trade dependency and trade surplus is much more than a matter of adjusting macroeconomic policy."

The retreat back to export-led growth, rather than merely a case of structural dependency, reflects a set of interests from the reform period that, as Yu puts it, "have morphed into vested interests, which are fighting hard to protect what they have." The export lobby, which brings together private entrepreneurs, state enterprise managers, foreign investors, and government technocrats, is the strongest lobby in Beijing. If the justification for stimulus spending has been trumped by ideology in the United States, in China the equally impeccable rationale for domestic-market-centered growth has been trounced by material interests.

Global Deflation

So decoupling is not a likely trend since China's leaders have chosen to stake the future of the Chinese economy on U.S. and, to some extent, European demand. But the context has changed ever since the rupture in the pre-crisis "partnership" between the American consumer and the Chinese producer. Not only are Americans deep in debt but the budgetary crunch pushed by the fiscal hawks will squeeze their incomes even further.

Indeed, what analysts like Dumas refer to as China's "reversion to type" as an export-oriented economy will clash with the efforts of the United States and Europe to speed recovery by adopting China's own formula: pushing exports while raising barriers to the inflow of imports. The likely result of the competitive promotion of this volatile mix of export push and domestic protection by all three leading sectors of the global economy at a time of stagnant world trade will not be global expansion but global deflation.

As Jeffrey Garten, former U.S. undersecretary of commerce under Bill Clinton, has written:

"While so much attention has focused on consumer and industrial demand in the US and China, the deflationary policies enveloping the EU, the world's largest economic unit, could badly undermine global economic growth…The difficulties could cause Europe to redouble its focus on exports at the same time that the US, Asia, and Latin America are also betting their economies on selling more abroad, thereby exacerbating already-high currency tensions. It could lead to a resurgence of state-sponsored industrial policies, already growing around the world. And together, these factors could ignite the virulent protectionism that everyone fears."

What is in store for us in 2011 and beyond, Garten warns, is "exceptional turbulence as the waning days of the global economic order we have known plays [sic] out chaotically, possibly destructively." He projects a pessimism that is increasingly capturing sections of a global elite that once heralded globalization but now sees it disintegrating before its eyes. This resigned fin-de-siècle mood is not a western monopoly. Yu Yongding also claims that China's "growth pattern has now almost exhausted its potential." The economy that most successfully rode the globalization wave, China "has reached a crucial juncture: without painful structural adjustments, the momentum of its economic growth could suddenly be lost. China's rapid growth has been achieved at an extremely high cost. Only future generations will know the true price."

In contrast to the apprehension of establishment figures like Garten and Yu, many progressives see turbulence and conflict as necessary accompaniments of the birth of a new order. Workers have indeed been on the move in China, where strikes in selected foreign companies in 2010 resulted in significant wage gains . Protesters are indeed out in the streets in Ireland, Greece, France, and Britain.

Unlike in China, however, they are marching to preserve what rights they have left. And neither in China nor the West nor elsewhere is this resistance accompanied by an alternative vision to the global capitalist order. A more far-reaching discussion of alternative economic arrangements should be ongoing as the global economic crisis enters its fourth year. But the debate continues to be trapped between the sterile spend-and-stimulate versus cut-the-deficit positions. The shape of things to come is simply not visible in the embers of the old. At least, not yet.

Economists foretell of U.S. decline, China's ascension

 (Again, I can't stress this enough: when you see mainstream media talking heads report on the economic recovery, they are spouting nonsense. We are being placated, because the powers that be know most Americans will panic and make bank runs and riot, and make things worse. By the way, if you are going to withdraw your funds in anticipation of ill economic winds, do it soon before you lose the ability to do so.--jef)


US Economic Decline
by Mark Felsenthal
Reuters US Online Report Business News
Jan 09, 2011

DENVER (Reuters) - To hear a number of prominent economists tell it, it doesn't look good for the U.S. economy, not this year, not in 10 years.

Leading thinkers in the dismal science speaking at an annual convention offered varying visions of U.S. economic decline, in the short, medium and long term. This year, the recovery may bog down as government stimulus measures dry up.

In the long run, the United States must face up to inevitably being overtaken by China as the world's largest economy. And it may have missed a chance to rein in its largest financial institutions, many of whom remain too big to fail and are getting bigger.

On the one hand, Harvard's Martin Feldstein said he believes the outlook for U.S. economic growth in 2011 is less sanguine than many believe.

First, the boost to growth from government spending will be drying up this year, he said. Renewal of expiring tax cuts is no more than a decision not to raise taxes, and the impact of one-year payroll tax cut is likely modest, he said.

"There's really not much help coming from fiscal policy in the year ahead," he said. Woes from the dire situations of state and local governments may actually be a drag on growth, he said.

Growth got a lift from a lower saving rate in 2010, but that probably will not last this year as households worried about an uncertain future return to paring back debt and socking more away, Feldstein added. Discouraging declines in home values mean there is less to save from, he said.

"People are worried, so there's a strong reason for precautionary saving," he said.

THE RACE IS ON

On the other hand, there is the race with China and the dynamic Asian economies, including India. Most estimates put the size of the Chinese economy on par with the United States by the early 2020s, said Dale Jorgenson, also of Harvard.

Jorgenson sees Asian emerging markets as the most dynamic in the world, eclipsing other emerging market contenders such as Brazil and Russia with steady growth over the next decade.

"The rise of developing Asia is going to accompany slower world economic growth," he said.

The United States will need to come to terms with the fact that its prevalence in the world is fated to come to an end, Jorgenson said. This will be difficult for many Americans to swallow and the United States should brace for social unrest amid blame over who was responsible for squandering global primacy, he said.

MIT's Simon Johnson put it more bluntly, saying the damage from the financial crisis and its aftermath have dealt U.S. prominence a permanent blow.

"The age of American predominance is over," he told a panel. "The (Chinese) Yuan will be the world's reserve currency within two decades."

Johnson said he believes the United States has failed to learn its lesson from the financial crisis and continues to implicitly back its largest financial institutions.

"I'm concerned about the excessive power of the largest global banks," he said. "Who are the government-sponsored enterprises now? It's the six biggest bank holding companies."

To be sure, Raghuram Rajan, a former IMF chief economist now with the University of Chicago's Booth School of Business, could still envision an ongoing U.S. leadership role.

Nothing proceeds in a straight line, he said, and there are many pitfalls along the way even for dynamic Asian economies.

"I would say the age of American dominance may be nearing an end. But America as the biggest mover will be in place for a long time," he said.

The Problem with Design...

...Imperialism or Thinking Too Small? 

ALEX STEFFEN, 15 JUL 10

Bruce Nussbaum has stirred up a fierce debate with his new article Is Humanitarian Design the New Imperialism?. Nussbaum criticizes groups like Project H, Acumen Fundand Architecture for Humanity for being perhaps naive about the post-colonial landscape they face in Asia and Africa:

Is the new humanitarian design coming out of the U.S. and Europe being perceived through post-colonial eyes as colonialism? Are the American and European designers presuming too much in their attempt to do good?

What's more, Nussbaum says, we ought to be focusing our efforts closer to home: "And finally, one last question: why are we only doing humanitarian design in Asia and Africa and not Native American reservations or rural areas, where standards of education, water and health match the very worst overseas?"

Of course, Emily Pilloton of Project H has shot right back, saying it is Nussbaum himself who is out of touch with the younger generation of humanitarian designers, designers who are well-aware of the cultural and political landscapes in which they're working, and are in fact increasingly focused on problems closer to home:

It is only through this local engagement and shared investment that the humanitarian design process shines. It is through this personal connection to place and people that the human qualities of design rise to the top of the priority list, through which our clients are no longer beneficiaries, but experts and co-designers right there with us. In his infamous address titled “To Hell With Good Intentions,” Ivan Illich puts this beautifully: 'If you have any sense of responsibility at all, stay with your riots here at home...You will know what you are doing, why you are doing it, and how to communicate with those to whom you speak. And you will know when you fail. If you insist on working with the poor, if this is your vocation, then at least work among the poor who can tell you to go to hell.' We all have to learn how to be citizens again: citizens first, and designers second. Citizenship is inherently local, defined by our connection and commitment to the places we best know and most love.

In the last few days, there have been different takes on this debate from leading thinkers likeCameron Sinclair, Susan Szenasy and Robert Fabricant. Now, I have conflicts of interest all over the place here -- Emily and Cameron are friends, I've sat on a panel and shared ideas with Susan, and Worldchanging's discussing a project with Frog Design -- so I'm not going to take sides, but I find the conversation extremely encouraging.

That said, some things are missing here, I think. In particular, the whole discussion has glanced over two critical realities: the scope, scale and speed of the planetary crisis we face, and the profoundly unequal distribution of access that exists to tools of innovation globally. I don't have time to write a proper essay today, but I'd like to share a few thoughts.

Most of us in the Global North are out of touch with the scope, scale and speed of the problems we face. We live in a global civilization that can measure its life expectancy in decades if it continues to operate as it does today. We know that we're straying beyond a series of non-negotiable ecological boundaries (the most obvious being the concentration of greenhouse gasses in the atmosphere). The predicted consequences are profound in a way that's difficult to fully grasp, but could well involve the complete collapse of large portions of human society and almost unimaginable suffering and destruction.

"This is not a small probability of a rather unattractive outcome," as Lord Stern, former Chief Economist of the World Bank, reminds us. "This is a big probability of a very bad outcome.”

This planetary sustainability crisis is impossible to tackle unless the Global North redesigns its own prosperity to be at least carbon neutral (and probably actually  carbon negative) by 2050. Because it takes time for innovations to spread and become universal, that 2050 goal, in turn, means innovating many of our urban land use, transportation and energy systems (as well as the products and services we use) to be  carbon neutral by 2030. Zero impact is the only rational goal,  and we need to be working towards it right now.

In addition, between two and four billion young people are expected to raise themselves into the global middle class in the Global South over the next 40 years, and billions more poorer people will have to find stable systems of survival in a rapidly changing world. The new global middle class can only adopt a bright green, climate-responsible model of prosperity if such a model is available when they need it. That forces us to confront a second planetary reality: the international distribution of problem-solving resources is profoundly unfair.

A gigantic imbalance in capacities and resources exists between the Global North and Global South. This is, obviously, not to argue that Southern designers, engineers and entrepreneurs are less capable (or less innovative) than their Northern counterparts. If anything, the evidence points to the opposite conclusion.

But in Northerners' desires to avoid the pitfalls of cultural imperialism and the failed model of top-down aid (and, let's be honest, to be seen to be down with other cultures), we go whistling past the mountainous reality of power inequality in our global society, and the extent to which, in a knowledge economy, that power is about the ability to generate and deploy ideas.

The Global North has the vast majority of the world's finest universities, libraries and broadband connections. It has the lion's share of the best-trained designers and professional innovators: there are probably more top-level product designers in New York than in all of India; probably more top-flight software engineers in the Bay Area than in all of Africa. That's not even getting into corporate R+D labs, incubators, fellowships, internships and all the other capacity that spins off the design, technology and engineering industries: almost all of which are in the developed world.

What's more, we know that innovation sparks from clusters of talented people in close proximity -- from scenius-- but it catches fire when exposed to capital, subjected to debate (in magazines, at conferences, on campuses) and connected to networks of other equally talented professionals in other fields. Most of those clusters are in the Global North; the remainder are in places (like Sao Paolo and Shanghai) that are already approaching "developed" status. Hotbeds, conferences and venture capital are not fairly distributed around the Earth.

It's a harsh reality that the vast bulk of the world's ability to solve system-scale problems is concentrated in wealthy countries. If a bright green model of prosperity is going to be invented in time for billions of young people to adopt it, big chunks of it will have to come from the Global North and be spread through partnerships between the North and South.

Obviously, complexities abound. Some of the world's most innovative thinking is happening on "the edges" of the wealthy world, in newly emerging economies. The Global North often stifles innovation with outdated codes and regulation. Many designers in New York or London may mot have the foggiest clue what on-the-ground challenges present themselves in the cities of the Global South, and so lack the ability to design solutions at home that will have a broader value. Many people cannot afford to participate in the major capitalist forms of innovation diffusion. Furthermore, flowing innovations to the bottom billion is wrought with difficulties. Some nations suffer from a hipness invisibility (what some have called the Ninja Gap), which makes them unable to draw even the most modest notice from folks in a position to help them solve problems. Finally, the ability of experts operating in ignorance of context to screw a system or place up beyond recognition should never be underestimated.

Yet, yet, yet... the reality is that we inherited a broken future, and designing a better one is going to take the whole-hearted participation of hundreds of thousands of creative, innovative people in the cities of the Global North. It's going to take grappling with remaking our own cities and systems into sustainably prosperous forms -- and doing it with an eye to global realities, the need for innovation diffusion and the cultural minefields involved. It's ultimately going to take redesigning (or at least reconsidering) pretty much everything about the way our cities work.

So, perhaps it's worth shifting the debate a little to discuss the obligations of not just humanitarian designers, but all designers to design responsibly? Maybe presumption is less the problem than a lack of planetary thinking.