Divided States of America: The Mother of all Austerity Measures – SPIEGEL ONLINE

Divided States of America: The Mother of all Austerity Measures – SPIEGEL ONLINE.

Divided States of AmericaNotes on the Decline of a Great Nation

By SPIEGEL Staff

REUTERS

Part 4: The Mother of all Austerity Measures

In the 2012 campaign, many Americans have realized for the first time that the US’s role as a global power is no longer uncontested, something the Republicans blame on their enemy Obama, arguing that he hasn’t been aggressive enough in places like Libya, Syria and Iran. « We can neither retreat from the world nor try to bully it into submission, » he said before coming into office, a statement that Republicans interpret as a sign of weakness, a conviction they feel is only reinforced by the military withdrawals during Obama’s term.

Obama wanted to withdraw US troops from Iraq and, by 2014, from Afghanistan, but he also had no choice. Both cost considerations and the dramatic failure of both operations spoke in favor of withdrawals. Contrary to what many a global strategist at the Pentagon may have envisioned, Iraq has not turned into a nucleus for new democracies in the Arab world. Instead, the country continues to stagnate today as a new dictatorship in disguise, and it remains plagued by terrible bombing attacks. After 10 years of war, and despite the collaboration between NATO and the United Nations, Afghanistan, a major global project, remains a failure for the United States, which has already lost 2,144 soldiers and has brought home tens of thousands of troops with physical and emotional injuries, without being able to celebrate a tangible success.

The upheavals in the Arab world took America’s diplomats by surprise, and they ended Obama’s offensive in the Islamic world. But they also showed how poorly connected and, ultimately, uninfluential the United States is in the region today. A member of the Muslim Brotherhood is now Egypt’s president, Iran apparently remains undeterred in advancing its nuclear program and the situation in Israel is more precarious that ever. These are all signs that America has far less influence than many Americans still want to believe.

This is not solely attributable to an American decline, but also has to do with various shifts in the global power structure. The unique role the country enjoyed for a short period after the collapse of the Soviet Union is gone. There was a moment, at the time, in which the apologists for American greatness had already declared the end of history, because they felt that there was now proof that there could only be one model of governmental organization: the Western, economically liberal democracy based on freedom. But that moment is over.

The Beginning of the Post-American World

Romney’s campaign speeches sounded especially empty when he proclaimed the 21st century as an « American century, » once again. In fact, there is much more to be said for the notion that, as Time columnist Zakaria believes, the « age of the post-American world » is beginning. In his new book « In No One’s World, » Washington political scientist Charles Kupchan writes that there are apparently « multiple paths to modernity, » even if this isn’t what the old West wants to hear. The world, says Kupchan, is not getting more homogeneous and more American, but rather more diverse and less American.

China is a case in point. For the time being the country, with its authoritarian government, has apparently managed to enable a sufficiently large middle class to take part in its economic success, so that a majority of Chinese citizens are not as likely to challenge Communist Party control. Some 80 percent of respondents to a survey in China said that they were satisfied with the country’s direction, compared to less than 30 percent of respondents to a similar survey in the United States. Many developing countries are now looking to China instead of the US as a role model on how to structure a country. They are no longer seeking the light of the American beacon on the horizon. And unless a miracle occurs after the election, specifically by Dec. 31, 2012, that light could go out soon, or at least be reduced to a flicker.

That’s when an ultimatum expires that is known as the « fiscal cliff, » which Democrats and Republicans set for themselves, after the dramatic failure of their budget negotiations in the summer of 2011, so as not to drive the world’s largest government budget against a wall. If both sides can’t agree to a joint solution, budget cuts and tax increases will automatically take effect on Dec. 31 that will massively reduce the deficit by $900 billion.

So far, both sides have shown little willingness to compromise. The Democrats insist on tax increases for the rich, which the Republicans reject, arguing that the budget should be consolidated through spending cuts alone. President Obama, who will remain in office until at least Jan. 20, 2013, regardless of the election outcome, has announced that he will veto any proposal that doesn’t include higher taxes for the rich.

The automatic emergency savings package would reduce the budget deficit by $607 billion. This would translate into cuts for doctors and hospitals, schools and day care, theaters and museums, train stations, airports and universities. Purchasing power would be reduced and investments would not be made, all because, in today’s America, political compromises and the reasonable balancing of interests no longer seem possible.

An austerity program of this magnitude would cost the economy about 5.1 percent of the gross domestic product. Not even the crisis-ridden countries of the euro zone have instituted such drastic austerity programs.

According to official government sources, the country could face a « significant recession » unless it finds a solution to its budget problem. The economy, which is predicted to grow by at least 2.5 percent next year, could shrink instead, leading to an unemployment rate of more than 9 percent. It’s a nightmare scenario that even the International Monetary Fund, normally a proponent of drastic austerity programs, warns against. Behind the fiscal cliff is a gaping abyss into which all hopes for America’s future could disappear.

Perhaps it is already merely a question of controlling the problem and making preparations for the post-American age.

That would require changes to the National Mall in Washington, DC. Memorials for the soldiers killed in the wars in Iraq and Afghanistan would be needed, memorials that are still missing in the open-air museum of imperial American greatness. One day, a statue would also have to be erected for the first black president of the United States, Barack Hussein Obama. The plaque could very well read that he had the misfortune of coming into office when the American empire was just turning into a beautiful memory.

By ULLRICH FICHTNER, HANS HOYNG, MARC HUJER AND GREGOR PETER SCHMITZ

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Iceland’s Economy Now Growing Faster Than The U.S. and EU After Arresting Corrupt Bankers

So Iceland didnt follow the rest of the world by bailing out bankers they arrested them. Now their economy is recovering faster than the EU and the United States.

Remember when the United States government told the American people that action was required to save the banks? Action in the form of Billions of dollars in debt? Yeah we remember that. Hundreds of Billions of dollars in National debt later were still chasing our tail trying to get out of debt.

At the time of the 2008 collapse Iceland was in worse shape than almost any other country in the world. Hmmmmm..

Imaging what America would be like today if we bailed out the victims of poor banking practices, and punished the bankers who were responsible instead of bailing them out.

After watching this video tell us what you think? Is Iceland off their rocker, or on to something that America should have done as well.

Iceland’s Economy Now Growing Faster Than The U.S. and EU After Arresting Corrupt Bankers – Secrets of the Fed.

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Qui doit payer l’austérité?

Les tensions viennent d’un sentiment de détournement des richesses: les populations paient à la place des spéculateurs

Par Myret Zaki, le 3 octobre 2012

Ces dernières semaines, nous avons vu les populations se soulever contre les méfaits de l’austérité, que ce soit en Grèce, en Espagne ou au Portugal, sur fond de montée de l’europhobie. Dans l’esprit de tout-un-chacun, le coupable est «l’austérité». Mais le vrai problème, ce n’est pas l’austérité. C’est qui paie la facture de cette austérité. Les sacrifiés, ce sont la masse des petits et moyens salariés de la zone euro, ceux qui forment le tissu de l’économie réelle. Or il y a tragique méprise: ceux qui passent à la caisse ne sont pas les principaux responsables de la crise. Jamais auparavant les peuples n’avaient dû s’appauvrir alors que le monde était si riche, et que leur propre prodigalité avait si peu à voir avec la crise. C’est à ce titre que cette austérité est illégitime. D’où le profond malaise. Cette crise a pour origine les dégâts colossaux de la spéculation financière sur l’économie réelle et sur les budgets des Etats. Ces derniers ont dû encaisser les chocs récessionnistes et fiscaux majeurs de la bulle boursière et immobilière venue des Etats-Unis, qui avait entraîné, par voie de mimétisme monétaire, des bulles de même nature en Espagne, en Angleterre et en Irlande. Les mêmes techniques spéculatives importées ont permis à Goldman Sachs de s’enrichir en vendant à la Grèce une solution pour masquer son endettement. Les tensions actuelles viennent d’un sentiment de détournement des richesses, les populations ayant d’abord supporté les sauvetages bancaires, et devant, avec l’austérité, supporter le sauvetage des Etats… qui avaient sauvé la finance privée. Quand les Portugais marchent contre le «vol des salaires et des pensions», ils se doutent bien qu’il y a tromperie.

A raison. Ainsi, les mêmes 5 milliards d’euros que Lisbonne demande aux Portugais d’économiser en 2013 sont ceux que les fonds spéculatifs ont raflé en 2011 en dégradant la dette du Portugal et de ses voisins. Depuis 2010 en effet, le détournement de richesses s’opère à travers les gains privés réalisés sur la mise à terre des dettes européennes. En 2011, les fonds spéculatifs ont généré leurs meilleurs profits sur la chute provoquée des obligations de la zone euro. Selon CNBC, les fonds britanniques Brevan Howard, Caxton Associates et GLG Partners en ont tiré, sur les seuls mois d’août et septembre 2011, 3 milliards de dollars, soit la moitié de l’austérité que devra consentir le Portugal en 2013. Et là, on parle de 3 fonds et de quelques semaines. Il faudrait encore ajouter tout ce qu’ont gagné, en pariant contre l’Europe, les fonds de Paul Tudor Jones, Soros Fund Management, Brigade Capital, Greenlight Capital et SAC Capital Management, mais aussi John Paulson, ainsi que les principales banques intermédiaires sur ces stratégies que sont Goldman Sachs, Bank of America et Barclays. D’immenses fortunes se sont créées. Ces gains proviennent de la chute de valeur des obligations grecques et des pays voisins, causée par des ventes à découvert (short selling) massives. L’argent tiré de ces paris vendeurs est le même qui est soustrait aux gouvernements par la flambée des taux d’intérêt ainsi créée, induisant leur strangulation financière. Avec l’austérité, Athènes, Lisbonne et Madrid demandent aux salariés européens de renflouer les pertes colossales que ces gouvernements ont essuyées suite au transfert d’une partie de leurs richesses vers la finance spéculative. Cette dernière a donc permis de détourner des fonds publics vers des traders milliardaires.

Des fortunes colossales

Les gains individuels que peut générer le short selling dépassent l’entendement. L’Americain John Paulson avait empoché, à lui seul, 3 milliards de dollars en 2007 en pariant contre l’immobilier américain. Avant lui, George Soros s’était personnellement enrichi de 2 milliards en 1992 en coulant la livre sterling. Les hedge funds gagnent davantage que des pays entiers. En 2006, 25 spéculateurs (dont Jim Simons et Kenneth Griffin) avaient personnellement empoché l’équivalent du PIB de l’Islande (15 milliards de dollars). D’aucuns refusent par principe d’établir un quelconque lien entre les fortunes amassées par les hedge funds sur les difficultés de l’Europe et l’austérité en cours: c’est manquer là de notions financières de base. De toute évidence, les gains prélevés par les acteurs financiers équivalent à l’austérité aujourd’hui payée par la population. Ceux qui devraient renflouer les Etats ne sont autres que ceux qui les ont ruinés. Au minimum devraient-ils contribuer au prorata des pertes économiques et de l’endettement qu’ils ont occasionnés. Mais comment l’Europe pourra-t-elle jamais récupérer cet argent, elle qui a tenté en vain de réglementer la spéculation?

Qui doit payer l’austérité? | BILAN.