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A Tectonic Shift in Hegemony at the G7

by STEPHEN MARTIN

Between each individual and entire humanity, however, stands the Nation, with its special language and literature, with its peculiar origin and history, with its special manners and customs, laws and institutions, with the claims of all these for existence, independence, perfection, and continuance for the future, and with its separate territory; a society which, united by a thousand ties of mind and of interests, combines itself into one independent whole.

–Friedrich List

The recent volte-face of  Henry Paulson concerning taxpayers money  – flashback: Sept 23 , Senate Banking Committee  “Some said we should just stick capital in the banks, take preferred stock in the banks. That’s what you do when you have failure,” Oct 10, Press Conference “We can use the taxpayer’s money more effectively and efficiently, get more for the taxpayer’s dollar, if we develop a standardized program to buy equity in financial institutions,” Does indeed mean failure.

The Oct G7 meeting was a real kick in the teeth for the currently prevailing American System of Finance, ( i.e Federal Reserve, IMF and World Bank)  and the machinations of it’s aspirations in form of best laid scheme.  It marked a tectonic shift in terms of macroeconomics and hegemony in the financial channel of  Globalisation. European Union to America: ‘We don’t want your solution, we don’t want your money’.

Of course that wasn’t stated directly, there is a code to be complied with, and a world of discrete meaning in Diplomacy. As in:

 “We will have to coordinate internationally, but beyond that there should be room for nation-specific solutions,”
German Finance Minister Peer Steinbrueck

“We should not imagine that we will have a harmonised response that will be the same for everyone, quite simply because you cannot apply the same method to market situations that are different,”
French Economy Minister Christine Lagarde

“Governments need to move on from simply agreeing on a general approach”.
UK Chancellor of the Exchequer, Alistair Darling

One wonders how a firebrand maverick like Hugo Chavez in his ‘diplomacy’ would have put it. Words in which sulphur figured no doubt, and hygiene in a financial setting – accompanying  a  less than polite decline in suggestion of alternative – to do with sex and travel perchance?

The world, it seems, has had enough of the American Dream as has been hi –jacked by Bankers and their ilk and who seek total global dominance. An excellent recent article by Chris Floyd this newsletter summarised the consequences of such hi-jacking lucidly in terms of  how  the Political Agenda in America is shaped:

“So remember well the lessons of this new October crash: The money to make a better life, to serve the common good, has always been there. But it has been kept from you by deceit, by dogma, by greed, and by the ambition of those who have sold their souls, and betrayed their brothers and sisters, their fellow human creatures, for the sake of privilege and power.”

The portrayal of America as involving  rugged individualism of entrepreneurial spirit in the land of opportunity, the freedom and primacy of the market and taboo against even contemplation of interference by State, is no more than a cruel distortion befitting  cynical calculation of Horatio Alger like  tale as reinforcing dream; and in stark contrast to the nightmare reality of the absence of care for the  welfare of citizen in a State which represents the interest of a few as corrupt, dishonest and greedy at the expense of  the many who are loyal, honest and hard working. There has been a progressive and  deeply cynical narrowing of interests in representation in American Politics, the poor lacking any real representation, denied any real place on the agenda in the singularity of focus;  in the narrowness of money fostered world view by such as  campaign contribution and lobbying group.

This become the American Nation as travesty of constitution, and as mockery of  promise inscribed on Statue of Liberty.

Thus to the opening quote, by an Economist whom I am thankful to have had my attention brought recently, and also to the subject of hegemony in context of fuller consideration of the significance of the G7 meeting as being disputation over the meaning of ‘Nation.’ such context.

It has been contended that the Anglo-American world view rests on the shoulders of three individuals. Isaac Newton in Science, John Locke in Politics, and Adam Smith in Economics.  The  laissez- faire approach to economics is at the heart of American Politics. Evidence the outrage in many quarters at  Paulson’s Bail Out for Banks as running completely contrary to the dictates of laissez- faire as American way.  In proposing such a move there is recognition of an alternative approach – and manifestation of abject hypocrisy in form of ‘one law for the rich, another for the poor’. Not enough that the burden of taxation be raised on the back of the citizen as opposed to  from Corporation or the wealthy;  the nose of citizen must be rubbed in it – by using such taxes to further support the wealthy in protecting them from consequences of loss as moral hazard! The ruggedness of individualism extends to the callousness and monstrosity of ‘patient dumping’ where the welfare of the poor are concerned, but when wealthy individuals are involved, State intervention is required to protect welfare. No money for physical health of poor citizen, but plenty of money where the financial health of the wealthy is at risk.

It was perchance communication of such role of individual within Nation as Political Reality the American Way which bore fruition in the schism apparent at the G7 meeting. The problem is with how money shapes Nation. Do other Nations wish the American model of individuality and political reality, with it’s glaring disparities in wealth and quality of life, and prioritisation concerning need and greed? The European Nations represented at G7 answered this question negatively, and in such answer there is a change in the wind of quite some significance.

There is also potential difference in approach concerning the State taking equity in financial institution of similar significance. In the EU approach, the State will have a say, or vote, in how the company is run. It will also have a say concerning reward for top executives. In the UK, one senior corporate executive of a now State run bank has resigned.  One wonders if the State intervention model adopted by the United States will also mean a say in the running of the company?   Or indeed, concerning reward for executives. Or corporate ‘heads rolling’ on block of State as owner for that matter.

One thing is for sure, and that is that the macroeconomic channels of Finance as a means of determination of individuality within Nation, as expressive of major aspect of Globalisation, no longer quite conveys the hegemony of American vision to such extent as was intent in the best laid scheme.

I for one, rejoice in such contemplation, while hoping for improvement in the way  America treats the Individual in relation to being a Nation – as in quote from Friedrich List.

STEPHEN MARTIN can be reached at: stephenmarti@yahoo.com

 

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Stephen Martin can be reached at: stephenmarti@yahoo.com

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