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Mercosur Opens the Doors to Socialism

The MERCOSUR alliance officially welcomed Venezuela as a permanent member.

By ALONSO SOTO | REUTERS | AUGUST 1, 2012

On his first foreign trip since undergoing cancer treatment in Cuba earlier this year, Venezuelan President Hugo Chavez hailed his country’s welcome by fellow South American leaders into a troubled regional trade bloc on Tuesday.

Ignoring criticism that Venezuela’s entry could eventually cause greater dysfunction among the Mercosur trade bloc’s members, Chavez cast the event as a continuation of his self-styled revolution and a sign of greater ascendance for South America as a whole.

“Our north is the south,” the Venezuelan president said, evoking Simon Bolivar and other revolutionaries who wrested the continent from colonial rule. “Mercosur is, without a doubt, the most powerful engine that exists to preserve our independence.”

Chavez, who recently declared himself cancer-free, stood at a podium throughout his 20-minute speech in Brazil’s capital and spoke in a clear, strong voice. Later, after a meeting at Brazil’s foreign ministry, he jigged and declared that his health “is very good, as you can see.”

The meeting was overshadowed by controversial events that enabled Venezuela’s entry into Mercosur, which also includes Brazil, Argentina, Paraguay and Uruguay. The grouping now accounts for about $3.3 trillion in combined gross domestic product, and the leaders said it would be the world’s fifth-largest economy if it were a single nation.

The expansion of Mercosur was criticized by many who see a paradox in the protectionist policies and leftist slant that increasingly have come to dominate a bloc originally created to liberalize trade.

After years of stalled negotiations with Caracas, the group hastily accepted Venezuela despite the objections of Paraguay, a marked absence at Tuesday’s meeting. The other three countries made their invitation to Chavez after suspending Paraguay in June because of the controversial impeachment there by conservative legislators of leftist president Fernando Lugo.

That move troubled critics, who said it was emblematic of the decline of a bloc that was founded in 1995, at a time when a group of free-market reformers was dominant in the region.

“What was once an economic bloc has now been reduced to a political sideshow,” said Mario Marconini, a former Brazilian trade secretary who is now a business consultant in Sao Paulo. The inclusion of Venezuela despite the veto of a full-fledged member, “is a fatal blow to its economic credibility.”

Brazilian President Dilma Rousseff said on Tuesday that Paraguay’s suspension is justified until the country “normalizes” its internal politics. Brazil and other neighboring countries have argued that Paraguay must proceed with its regularly scheduled presidential elections next year before they consider its government to be stable.

FOCUS ON CHAVEZ

Most of the other leaders present glazed over the Paraguay controversy, and focused instead on criticizing the orthodox economic policies of the developed world. They cited Mercosur as a vehicle that could further regional goals of fair trade, equitable growth and social inclusion.

Chavez said construction companies from Mercosur countries should take part in ongoing projects to build millions of subsidized homes in Venezuela. Argentine President Cristina Fernandez said the region would continue to produce all-important raw materials for the global economy, but demanded “financial stability” in return from richer countries.

Mercosur, she said, could “make this new pole of power indivisible, indestructible.”

Chavez, who has spent more than 13 years in office, has pursued a personality driven government that has scared away foreign investors and crippled productivity. His acceptance by Mercosur, opponents say, will give him one more thing to boast about as he campaigns for another six-year term ahead of Venezuela’s presidential election in October.

Officially, the leaders hailed Venezuela’s strengths as a major oil producer and an important market for everything from Brazilian machinery to Argentine wheat. In practice, though, Venezuela can’t fully participate in the bloc until it agrees to accept a common tariff adopted by Mercosur, common agreements with third-party countries and other prerequisites that Chavez has failed to embrace since talks for inclusion began in 2006.

In a statement Tuesday, Brazil’s National Industry Confederation, a powerful business group, reminded Venezuela that “the new member has obligations to fulfill.” Citing the common tariff and other existing bloc conventions, the group urged Mercosur to establish a timeline by which Venezuela must comply.

Mercosur, the group added, “should focus on reinforcing the stability and predictability of the economic bloc.”

BLOC IS ALREADY TROUBLED

Many fear Venezuela will only complicate relations in an already dysfunctional grouping. “The bloc is a mess,” said Rubens Barbosa, a former Brazilian representative to Mercosur who is now a consultant.

“Just imagine if you start adding Venezuela and others,” he said, noting recent discussions to include Bolivia and Ecuador, two countries with close ties to Chavez.

Tuesday’s ceremony was accompanied by a trickle of business as Chavez and Rousseff formalized a previously disclosed plan by Conviasa, the Venezuelan airline, to purchase 100-seat jets made by Embraer, the Brazilian aircraft manufacturer. Under the terms

of the agreement, Conviasa will pay about $270 million for six Embraer 190 jets, with an option for 14 more.

Meanwhile, Venezuela and Argentina signed an agreement for greater investment in each other’s oil sector. PDVSA, Venezuela’s state-run oil producer, will invest in Argentine petrochemicals, and YPF, its Argentine counterpart, will invest in Venezuelan oil fields, according to the agreement.

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Less Sovereignty is the Central Bankers Solution for the Crisis

By LUIS MIRANDA | THE REAL AGENDA | JUNE 29, 2012

Everyone on the main stream seems to believe that the continuous meetings between European central bankers and government officials are seeking to save the Euro and to help the governments deal with their sovereign debts. It is common to hear on television how journalists and so-called analysts explain that their expectations include the proposal of real solutions to the crisis which immediately produce jobs and bring stability to the markets.

They just don’t get it. These meetings between central bankers and European leaders are nothing about stability, a solution to the debt problem or the creation of jobs around the euro zone. The latest agreement between the EU Council and the Prime Ministers of Italy and Spain is an example of how the bankers are in complete control. Although the media has painted the bailout of the Spanish and Italian banks as a triumph for both governments, which according to the reports “had their way” when negotiating with the bankers, the reality is they are simply following orders. It wasn’t the Spanish and Italian governments the ones who imposed the conditions that will rule the bailout, but the banks.

The rescue of the banking system in those countries is indeed a result of Italy and Spain submitting, accepting and supporting the idea that the European Central Bank will officially turn into the manager of all Euro economies. Only after Mariano Rajoy and Mario Monti accepted that condition, was that the central bankers gave the green light to ‘lend the money’ to the Spanish and Italian banks, not the other way around. The main stream media is portraying an outcome that is completely the opposite to reality by saying that Mr. Rajoy and Mr. Monti twisted German Chancellor Angela Merkel’s arm into accepting their conditions. The truth is that Merkel herself had to accept the centralization of economic planning sought by the banks as a condition not to let the EU zone collapse before the expected time, and with it drag every single nation including Germany into the rabbit hole they are all going towards in a controlled fashion.

Less sovereignty in exchange for solidarity; this is the latest talking point that emerged from European leaders to justify the loss of self-rule and the intervention of European bankers in the decision making process at the national level. Governments have publicly adopted what seems to be a socialist standing to try to sell their fiscal irresponsibility and to deviate attention from the acquisition of European nations by the central bankers who are the origin of the current financial crisis. But it is not socialism you see, it’s fascism. Countries must get more debt and surrender their sovereignty in order to solve a crisis that is not supposed to get solved, but that was created and planned to further centralize power in the hands of the bankers themselves.

Everyone who is well-informed is familiar with the World Bank and IMF’s plans to cause the current crisis, — and all the other ones that came before — how they’ve applied the same neo-feudal model throughout history to destroy economies and artificially recreate them using models for growth based on the acquisition of debt and the never-ending payments of interests on that debt. It needs to be said: This crisis is not accidental or unexpected. It was planned and executed for decades to seek a justification for a central government just as it has been promoted by the bankers and the media for the past 12 months. The result of the current negotiations in not to seek an exit to the debt problem or to encourage economic growth, but to hand even more power to the bankers.

The meeting held today where European Prime Ministers pose as the saviors is nothing else than window dressing. There is no solidarity on a proposal that intends to make nations less independent and more enslaved to the central bankers. The result that will came from the meeting held by Mariano Rajoy, Angela Merkel Mario Monti and François Hollande is further consolidation of financial power; nothing else. As explained by Joseph Stiglitz, the World Bank and the IMF pursue a policy of financial enslavement against every country by following four simple steps.

Privatization, which is more like ‘Briberization’, he told Greg Palast. Under this scheme, economies are collapsed from the inside while consolidating national assets for pennies on the dollar. Briberization yields then to the second step,  a one-size-fits-all rescue-your-economy plan, which in theory intends to rescue a country’s economy by using  capital market liberalization. This, again in theory, would allow the free flow of investment in and out of the country, but in reality it is the process through which the bankers complete the theft of resources and send them out every time a country buys into the “rescue your economy’ non-sense. As explained by Palast in his article The Globalizer who came in from the Cold, foreign monies come in to the countries for speculative acquisitions in various sectors of the economy and then leaves just as suddenly as it came. The result is the literal disappearance of a nation’s reserves in a matter of days. In order to get back some of those monies, entities like the IMF and the World Bank immediately demand that the country raise interest rates to anywhere between 30% and 80%.

Next, on step three, the bankers mandate that the government impose steep increases in the prices of basic needs such as food, water and gas. In the mid-term, the unexpected increases cause what Stiglitz calls the “The IMF riot.” During this time the bankers “turn up the heat until, finally, the whole cauldron blows up,” said Stiglitz. The bankers simply cut any and all subsidies to food and fuel for the poorest people as it happened in Argentina at the turn of the century and in Indonesia in 1998. Other examples of these riots were the ones in Bolivian riots over water prices last year and this February, the riots in Ecuador over the rise in cooking gas prices imposed by the World Bank.

Secret documents were also obtained by the BBC and The Observer which showed that the banks wanted to make the US dollar the official currency of Ecuador and by doing that, they would submit more than half of the population there under the poverty line. This is something similar to what was done in Argentina and what is being tried now in Europe. According to Stiglitz, although millions of people end up as losers under this system, there are indeed a handful of winners: The Banks. The western banks and the US Treasury make gigantic amounts of cash by infliction pain over developing nations. He cited the case of Ethiopia, where the World Bank and IMF ordered the government to ‘invest’ money on the Federal Reserve’s Treasuries which pays only 4 percent interest, while the country had to borrow money at 12 percent. Ethiopia was looted by the banks.

On step four of the bankers propose and impose the so-called Free Trade, as they did through NAFTA, CAFTA and other trade agreements. They call these programs “poverty reduction strategies”. However, all they do is open markets for a one way flow of products from powerful nations like the United States and China to the poor countries, while closing their own markets to foreign products. The almost automatic consequence of this free trade agreements is the destruction of the local production and farming since they cannot compete with the ridiculous low prices offered by corporations that have their products manufactured by slave labor in Asia and Africa.

As Greg Palast puts it, let there be no confusion about the role of the IMF, World Bank and World Trade Organization in the destruction of nation-states, private property and sovereignty, because they are just three masks that hide the faces of the monopoly men who seek to impose a centralized government model based on absolutist conditions.The results of the negotiations to supposedly save the euro zone are not such, they are just another step into the creeping arrival of world tyranny being sold as the only possible solution to deliver all of us from the consequences of “unbalanced economies”. The plans for the creation and implosion of economies were drafted long ago and the result of those practices is one and only one: World Government. This outcome, by the way, is not a solution or the solution to the current economic crisis.

When you have leaches sucking you dry, the only possible solution is to remove the leaches. The bleeding is the collapsing economy, the leaches are the central bankers, the solution is to remove them from our bodies. Nothing else has worked, nothing else will work.

Free Trade is not Free

By DAVID S. D’AMATO | CENTER FOR STATELESS SOCIETY | MARCH 18, 2012

On Thursday (March 15), CNNMoney reports, “the long-awaited free-trade agreement between the United States and South Korea … went into effect,” representing “the biggest U.S. trade deal since the North American Free Trade Agreement began in 1994.” One might assume that a libertarian, promoting individual rights and free markets, would (or should) favor such a deal as the practical implementation of libertarian principles.

And insofar as states’ free trade agreements did reify what could be considered libertarian principles, I would support them in earnest. But, as the saying goes, the devil is in the details, and when the details are accounted for, we find the same story of powerful interest groups engaging the state to secure special advantages.

Market anarchists advocate for a society shaped by free associations, community, and mutually beneficial trade. Our “free market” is in no way similar to the version contrived by the spin doctors of corporate public relations departments, in no way supportive of the monopolies that today deprive and exploit the overwhelming majority of people.

The “free trade” agreements that now govern much of global commerce (the United State-South Korea treaty being a representative example) mock the very idea and moral justifications of laissez faire. Where market anarchists champion freedom and individual rights as a means to a peaceful and just society, so-called “free trade” accords routinely include all manner of outrages against those principles.

Notably, the Export-Import Bank of the U.S. figures prominently in “free trade” deals. Created in 1934, its primary function, defended by virtually all members of Congress, is to act as a stanchion to international big business. According to professors William M. Pride, Robert J. Hughes, and Jack R. Kapoor, fiscal year 2008 saw the Ex-Im Bank authorize “$14.4 billion in loans, guarantees, and credit insurance worldwide …. It also cooperates with commercial banks in helping American exporters to offer credit to their overseas customers.”

In short, the state’s role in so-called “free trade” deals is to shift enormous risks to the unknowing and innocent taxpayer, to the working men and women who haven’t spent billions on petitioning for favors and privileges. Parasitic handouts to and special perks for giant, multinational corporations at the expense of productive, working individuals are not a part of a genuine free market.

In a genuine free market, absent coercive braces to established companies, companies would have to bear the heavy costs of managing a business across thousands of miles. Without the unfair advantage of being able to pass their financial risks onto taxpayers, corporations would be limited in size and in power.

Commerce on the local, community level would likely see a resurgence, delivered from the burden of the huge, state-supported monopolies that currently push everyone and everything else to the margins.

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Globalism Pushing Middle Class Standard of Living Down…

…to Third World Levels

The Economic Collapse
February 28, 2011

From now on, whenever you hear the term “the global economy” you should immediately equate it with the destruction of the U.S. middle class.  Over the past several decades, the American economy has been slowly but surely merged into the emerging one world economic system.  Unfortunately for the middle class, much of the rest of the world does not have the same minimum wage laws and worker protections that we do.

Therefore, the massive global corporations that now dominate our economy are able to pay workers in other countries slave labor wages and import the products that they make into the United States to compete with products made by “expensive” American workers.  This has resulted in a mass exodus of manufacturing facilities and jobs from the United States.

But without good, high paying jobs the U.S. middle class cannot continue to be the U.S middle class.  The only thing that the vast majority of Americans have to offer in the economic marketplace is their labor.  Sadly, that labor has now been dramatically devalued.  American workers now must directly compete for jobs with millions upon millions of workers on the other side of the world that toil away for 15 hours a day at slave labor wages.  This is causing jobs to leave the United States at an almost unbelievable rate, and it is putting tremendous downward pressure on the wages of millions of jobs that are still in the United States.

So when you hear terms such as “globalization” and “the global economy”, it is important to keep in mind that those are code words for the emerging one world economic system that is systematically wiping out the U.S. middle class.

A one world labor pool means that the standard of living for the U.S. middle class will continue falling toward the standard of living in the third world.

We keep hearing about how the U.S. economy is being transformed from a “manufacturing economy” into a “service economy”.  But “service jobs” are generally much lower paying than “manufacturing jobs”.  The number of good paying “middle class jobs” in the United States is rapidly decreasing.  So how can the U.S. middle class survive in such an environment?

What makes things even worse for manufacturers in the United States is that other nations often impose a “value-added tax” of 20 percent or more on U.S. goods entering their shores and yet most of the time we do not reciprocate with similar taxes.

But whenever someone mentions how incredibly unfair and unbalanced our trade agreements with other nations are, they are immediately labeled as a “protectionist”.

Well, someone should be looking out for U.S. interests when it comes to trade, because the current state of the global economy is ripping the U.S. middle class to shreds.

Right now, the United States consumes far more wealth than it produces.  This nation buys much, much more from the rest of the world than they buy from us.  This is called a “trade deficit”, and it is one of the most important economic statistics.  The U.S. runs a massive trade deficit every single year, and it is wiping out our national wealth, it is destroying our surviving industries and it is absolutely shredding middle class America.

We cannot allow tens of thousands of factories to continue to leave the United States.  We cannot allow millions of jobs to continue to be “outsourced” and “offshored”.  We cannot allow tens of billions of dollars of our national wealth to continue to be transferred into foreign hands every single month.

The truth is that the global economy is bad for America.  The following are 23 facts which prove that globalism is pushing the standard of living of the middle class down to third world levels….

#1 From December 2000 to December 2010, the U.S. ran a total trade deficit of 6.1 trillion dollars.

#2 The U.S. trade deficit was about 33 percent larger in 2010 than it was in 2009.

#3 The U.S. trade deficit with China in 2010 was 27 times larger than it was back in 1990.

#4 The U.S. economy is rapidly trading high wage jobs for low wage jobs.  According to a new report from the National Employment Law Project, higher wage industries accounted for 40 percent of the job losses over the past 12 months but only 14 percent of the job growth.  Lower wage industries accounted for just 23 percent of the job losses over the past 12 months and a whopping 49 percent of the job growth.

#5 Between December 2000 and December 2010, 38 percent of the manufacturing jobs in Ohio were lost, 42 percent of the manufacturing jobs in North Carolina were lost and 48 percent of the manufacturing jobs in Michigan were lost.

#6 In Germany, exports account for approximately 40 percent of GDP.  In China, exports account for approximately 30 percent of GDP.  In the United States, exports account for approximately 13 percent of GDP.

#7 Do you remember when the United States was the dominant manufacturer of automobiles and trucks on the globe?  Well, in 2010 the U.S. ran a trade deficit in automobiles, trucks and parts of $110 billion.

#8 In 2010, South Korea exported 12 times as many automobiles, trucks and parts to us as we exported to them.

#9 The U.S. economy now has 10 percent fewer “middle class jobs” than it did just ten years ago.

#10 The United States currently has 7.7 million fewer payroll jobs than it did back in December 2007.

#11 Back in 1970, 25 percent of all jobs in the United States were manufacturing jobs. Today, only 9 percent of the jobs in the United States are manufacturing jobs.

#12 In 2002, the United States had a trade deficit in “advanced technology products” of $16 billion with the rest of the world.  In 2010, that number skyrocketed to $82 billion.

#13 The United States now spends more than 4 dollars on goods and services from China for every one dollar that China spends on goods and services from the United States.

#14 In China, working conditions are so bad that large numbers of “employees” regularly try to commit suicide.  One major employer, Foxconn, has even gone so far as to install “anti-suicide nets” in an attempt to keep their employees from jumping off of their buildings.

#15 Wages for workers in China are incredibly low.  For example, one facility in the city of Longhua that makes iPods employs approximately 200,000 workers.  These workers put in endless 15-hour days but they only make about $50 per month.

#16 In Bangladesh, manufacturing workers toil in absolutely horrific conditions and make an average of about $38 per month.

#17 In Vietnam, teenage workers often work seven days a week for as little as 6 cents an hour making promotional Disney toys for McDonald’s.

#18 Since 2001, over 42,000 manufacturing facilities in the United States have been closed.

#19 Half of all American workers now earn $505 or less per week.

#20 In the United States today, 6.2 million Americans have been out of work for 6 months of longer.

#21 8.4 million Americans are currently working part-time jobs for “economic reasons”.  These jobs are mostly very low paying service jobs.

#22 When you adjust wages for inflation, middle class workers in the United States make less money today than they did back in 1971.

#23 According to Willem Buiter, the chief economist at Citigroup, China will be the largest economy in the world by the year 2020, and India will surpass China by the year 2050.

Those that promote “free trade” can never explain how the U.S. middle class is going to continue to have plenty of jobs in the new global economy.

By merging our labor pool with the rest of the world, we have also merged our standard of living with the rest of the world.  High unemployment is rapidly becoming “the new normal” in America, and wages are going to continue to decline in many, many industries.

Already, there are quite a few formerly great U.S. cities (such as Detroit) that are beginning to resemble third world hellholes.  If something is not done about our massive trade imbalance, even more cities are going to follow Detroit into oblivion.

Unfortunately, most of our politicians continue to insist that globalism is good for our society.  They continue to insist that we should not be worried that jobs formerly done by middle class American workers are now being done by slave laborers on the other side of the globe.  They continue to insist that having 43 million Americans on food stamps is a temporary thing and that soon our economy will be better than ever.

Well, it is time to stop listening to the politicians that are promoting “the global economy”.  They are lying to us.

Globalism is great for nations such as China and it is helping multinational corporations make huge profits, but for the U.S. middle class it is an economic death sentence.

If you want an America where there are less jobs, where more Americans are on food stamps and other anti-poverty programs and where our cities continue to be transformed into deindustrialized hellholes, then you should strongly support the emerging global economy.

But if you care about the standard of living of the U.S. middle class and you want for there to be some kind of viable economic future for your children and your grandchildren then you had better start caring about these issues and doing something about them.

Please wake up America.