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The Looming Mother of all Economic and Social Crisis - The Looming Mother of all Economic and Social Crisis

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The Looming Mother of all Economic and Social Crisis
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Poverty and Social Inequality

The global political economy thus enriches the very few at the expense of the vast majority. The crisis has contributed to widening social inequalities both within and between countries. Under global capitalism, mounting poverty is not the result of a scarcity or a lack of human and material resources. The structures of social inequality have, quite deliberately, been reinforced, leading not only to a generalized process of impoverishment but also to the demise of the middle and upper middle income groups.

Bankruptcies have hit several of the most vibrant sectors of the consumer economy. The middle classes in the West have, for several decades, been subjected to the erosion of their material wealth. It exists in theory, built and sustained by household and other debts. With the demise of the civilian economy, the development of America’s war economy, supported by a whopping near-trillion dollar defense budget, has reached new heights. As stock markets tumble and the recession unfolds, the advanced weapons industries, the military and national security contractors and the up-and-coming mercenary companies (among others) have experienced a thriving and booming growth of their various activities.

War and the Economic Crisis

Wars lead to the impoverishment of people at home and around the world. The provision of essential goods and services to meet basic human needs has been replaced by a profit-driven "killing machine" in support of America’s "Global War on Terror". While the poor are made to fight in Iraq and elsewhere, wars enrich the upper class, which control industry, the military, oil and banking. “Western nations, particularly the United States, spend hundreds of billions of dollars a year to murder innocent people in far-away impoverished nations, while the people at home suffer the disparities of poverty, class, gender and racial divides.”

An outright "economic war" resulting in unemployment, poverty and disease is carried out through the free market. In the last twenty years, the global "free market" economy has brought poverty and social destitution to the lives of millions of people. Instead of tackling the impending social catastrophe, Western governments, to serve the interests of the economic elites, have installed a "Big Brother" police state, with a mandate to confront and repress all forms of opposition and social dissent. George Orwell’s 1984 are being created in USA.

The economic and social crisis has by no means reached its climax, and entire countries, including Greece and Iceland, are at risk. One need only look at the escalation of the Middle East Central Asian war and the US-NATO threats to China, Russia and Iran to witness how war and the economy are intimately related.

The Decline of the West and a Depressing Scenerio

In the blog Global Guerilla, John Robb, writing on The Decline of the West states, “the current sovereign debt crisis is another battle in a war for dominance between "our" integrated, impersonal global economic system and traditional nation-states. At issue is whether a nation-state serves the interests of the governed or the interests of a global economic system.

The global economic system is winning. The 2008 financial crisis, the first real battle of this war (as opposed to the early losses in skirmishes in Russia, Argentina, the Balkans, etc) was a resounding defeat for nation-states. The current crisis in the EU will almost certainly end with the same results.

When this war ends, and it won't be long, the global economic and financial system will be the victor. The nation-states of the West will join with those of the global south, mere shells of states that serve only to enforce the interests of the global economic system. More market-states than nation-states, citizens’ incomes will fall to developing world levels (made easy to due highly portable productivity), and wealth will stratify. Regulatory protections will be weak. Civil service pensions will be erased and corruption will reign. The once-dominant militaries of the West will be reduced to a small fraction of their current size, and their focus will be on the maintenance of internal control rather than on external threats. The clear and unambiguous message to every citizen of the West will be “you’re on your own.”

It will fragment society and lead to perpetual stagnation/depression, endemic violence/corruption, and squalor. New sources of order will see the rise of the criminal entrepreneur, whether they are the be-suited corporate gangster or the gang tattooed thug. For in the world of hollow states (without a morality that limits behavior) and limitless connectivity to the global economic system, these criminal entrepreneurs quickly become dominant, violently coercing or corrupting everyone in the path to their enrichment. (In former socialist states of east and central Europe, local and migrant mafias form an important segment of the new ruling elites.)


The author has kept a watch and written about the decline and fall of US hegemony since 11 September, 2002, when a declining US empire appeared at its most dazzling, like the afternoon sun past its prime.

The decline of the American Century   Sept 11, 2002 Atimes:

The US Empire –Beginning of the End Game   24 Nov, 2006

The Decline and Coming Fall of US Hegemony March 30, 2008

-- An editorial titled 'Collapse of U.S. economy' in Belleville Intelligencer of 27 Feb, 2008 confirms the by now generally accepted ill health of US economy. Harry Koza in the Globe and Mail recently quoted Bernard Connelly, the global strategist at Banque AIG in London that the likelihood of a Great Depression is growing by the day. Martin Wolf of U.K.'s Financial Times cited Dr. Nouriel Roubini of the New York University's Stern School of Business, who outlines how the losses of the American financial system will grow to more than $1 trillion, an amount equal to all the assets of all American banks.

The next domino to fall will be credit card defaults, and after that...who knows? There are so many exotic funds out there, with trillions of dollars in paper--or rather computer-screen money--and all about to disintegrate into nothingness. Over the next couple of years, scores of banks that have thrived on these devices, based on quickly disappearing equities, will fail.

The most frightening forecast so far comes from the Global Europe Anticipation Bulletin (GEAB), "The end of the third quarter of 2008 will be marked by a new tipping point in the unfolding of the global systemic crisis. In the United States, this new tipping point will translate into - get this - a collapse of the real economy, (the) final socio-economic stage of the serial bursting of the housing and financial bubbles and of the pursuance of the U.S. dollar fall. The collapse of U.S. real economy means the virtual freeze of the American economic machinery: private and public bankruptcies in large numbers, companies and public services closing down."

We are not experiencing a "remake" of the 1929 crisis or a repetition of the 1970s oil crises or 1987 stock market crisis. What we will have, instead, is truly a global momentous threat - a true turning point affecting the entire planet and questioning the very foundations of the international system upon which the world was organized in the last decades."

Western Military-Capitalist Civilization in Disarray September 25, 2008;

"Credit easing does not and cannot substitute for earnings, wages or tax revenues."---Max Fraad Wolff

"The [US] financial system is out of control and has led the economy into a wildly turbulent sea of heavily leveraged speculation. … The road ahead is dark and unknown." Steve Fraser author of" Wall Street: America's Dream Palace."

"Before the US economy can truly begin to expand again, the savings rate must rise to pre-bubble levels of 8pc--$2 trillion of household debt must be eliminated",---Economist David Rosenberg

Corporate Culture and Greed Sink the American Republic 17 May, 2009

"Over-grown military establishments are. Under any form of government inauspicious to liberty, and are to be regarded as particularly hostile to republican liberty."--George Washington (1732-1799), First US President.

"It is part of the general pattern of misguided policy that our country is now geared to an arms economy which was bred in an artificially induced psychosis of war hysteria and nurtured upon an incessant propaganda of fear." --General Douglas MacArthur, Speech, May 15, 1951

"[The] conjunction of an immense military establishment and a large arms industry is new in the American experience. . . . In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist." --Dwight D. Eisenhower (1890-1969), 34th US President, Farewell Address, Jan. 17, 1961

Confirmation of Pressure on Dollar and US 8 October, 2009

And finally,

Falling Empires and their Currencies Rome, France, England and the USA Part 2: From England to the United States of America Rolf Nef January 16, 2007

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