Reigning in Public Debts or Challenging Democracies? 1st December 2011

Reigning in Public !Debts or Challenging Democracies?Ann Pettifor, PRIME (Policy Research in Macroeconomics)www.primeeconomics.org Madariaga College of Europe FoundationBrussels 1st December, 2011

Private !Wealth needs Greece • Greece does not need private wealth

Why should Greek & EU taxpayers shield privateﬁnancial sector from risk?

Struggle between public &private interests • Without taxpayer-backed bailouts (EFSE,ECB,IMF, the US FED), public guarantees, the privatisation of assets, private bankers face armageddon, as in 2008.• Bankers challenging democracies - removing elected politicians

Imposing technocrats Denying the people Voice

Total exposure of British private banks to Italian/Belgian/Greek public debt = $20bn (Bank forInternational Settlements, June, 2011)

Belgian private bank exposure to public debt of It/Gr/Ire = $19.47bn. (BIS June, 2011)

French private bank exposure to Italian/Greek/Irishpublic debt = $106bn (BIS, June, 2011)

Austerity marks ﬁnal failure ofexisting arrangements between Financial liberalisation has failed private & public interests

Next Steps• Euro must be abandoned • Not a currency of the peoples, but an ideal of private wealth • Euro a perversion of greatest monies in history - which arose as a relation between people and the state• Through development of central banks, domestic banks, state borrowing, paper currency, double-entry book- keeping and taxation, national monies have underpinned greatest societies in the world.

But Euro aimed at !interests of private!wealth • Divorced from nation states• Statutes explicitly prohibit the support of state activity • Through "swaps" "QE" etc. • Its foundation in monetarist doctrine inhibits private economic activity, has led to ﬁnancial monopolies• Rather than encouraging convergence across EU, intensiﬁes divergences

In 1931 Britain threw offthe "fetters" of Gold• Then as now the "Lords of Finance" demanded Austerity, and the impact of the Crash & Great Depression hammered the innocent.• The UK, led by Keynes, threw off the equivalent of the Euro, and restrained the bankers - subordinating their interests to the broader interests of society• Sterling was revived and protected from speculation

1934 Roosevelt freedthe dollar• Embarked on ﬁnest programme of public works expenditure in modern history• Great public buildings erected, symphony orchestras established, writers - like John Steinbeck - sponsored, murals created, swimming pools built. • In 1935 Socialist government in France did the same.• Only the Fascist governments remained in thrall to Gold, and to private wealth

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Reigning in Public Debts or Challenging Democracies? 1st December 2011

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Reigning in Public Debts or Challenging Democracies? 1st December 2011 — Presentation Transcript