Communist China & the Western Commentariat Finally Get on the Same Page: This Stupid Democracy Thing

from Counterpunch

Almost automatically, national governments tilt toward policies that protect the ability of the banks to recover on the debt—and, perhaps more importantly, sustain the viability of the government as a vehicle for continued issuance of debt in the future– by cutting the expenditures that might prop up personal and national incomes and could be seen to interfere with the flow of interest payments.

In the last analysis, the governments aren’t working for the shareholders (voters), even if examples like Argentina hint that a country might do well by defaulting on its debt.

I don’t even think they’re working for the bondholders, at least not for the dumb sheep who end up getting shorn (“taking haircuts”).

They’re working for the investment bankers who look forward to rolling over, increasing, securitizing, and slicing and dicing government debt—which is the most marketable, available in enormous volume, and is a perceived lower risk because taxpayers are, in the final analysis, hostages of their government when it comes to debt repayment (as long as they can be persuaded they don’t have an alternative).

How governments turned into debt vehicles is a matter for historians to sort out.  But I guess it has something to do with trying to keep the rich happy (by cutting taxes) while keeping the rest of us happy (by spending money on services).

When the bills come due, the rich (who have a perpetual interest in low taxes and an addiction to leveraging their profits through investment banking) turn out to have the most votes in our post-democracy democracies.

We need to make sure “our” governments realize that what they gain by continuing to make the Rich happy, will be far outweighed by what they will lose by making us unhappy!

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