http://www.reuters.com/article/marketsNews/idUSLE36034520081014

precisely why you should never trust bankers. He and others should (and I am sure will) take out a class action against all the executives – I beleive that could mean their personal assets will be at risk.

If there is any political organising to be done then it makes sense that we should also be giving legal assistance to all those that have lost everything.

And, I repeat, we need a blacklist of these bankers so they do not pollute the rest of the economy. Let them go run antique shops, or whatever else failed bankers do.

http://www.reuters.com/article/marketsNews/idUST23154120081015

Thanks again. For sure, parental responsibility goes hand in hand with other forms of interventions, I’d agree. That’s why we might talk about the ’state’ as one enabler, and say, the ‘market’ as another, and the third area would be ‘civil society’ which encompasses the family, too.

I would agree that some populations have more parental involvement/responsibility ethos than others, and perhaps that’s one of the more interesting parts of the debate when we look at the East Asia model.

I’d say here is a model (I am speaking in lay terms) where you have strong regulation fromt the state, as well as a strong tradition of family and broader community support – so linking civil soceity bit of the state-society-market dynamics I described above.

I don’t know how we got into the discussion about African-Americans, but I guess wearing a british hat here, October is the month where we have Black History Month, so just would be interesting to discuss this.

Thanks for the stats on state school participation in Ivy League colleges, I’ll comment later if I find the research stats for Europe to compare, but my comment here was that the Ivy League colleagues on the whole do drive harder to push for more inclusive participation. This is true of Oxbridge and Cambrige – but the barriers to educational participation persists.
It’s perhaps the middle ranking universities across the countries where you might find more homogenous balance of students. Again – my benchmarks for assessing inclusion is to look at the middle (average) level organisations. Not say, Margeret Thatcher as an example of gender equality in the UK.

Can’t argue with your point about respect for self-made millionnaires, but would be interested in the ’self-made’ bit of the equation… How self-made are the captians of industry across the board – instead of one or two of the islands of success at the top we continue to hold up as beacons.

It is a tactic of those that would choose to divide and conquer us, to get us riled up against a common enemy and then abandon us.

You only have to look at the complete disaster that the anti-war movement proved to be. With decent leadership, I’d suggest, they could have made a difference.

But the fact that lots of, frankly, non political folk were angry about what was being proposed, was subverted by nutters calling for a ‘rising of the proletariat’ or some such nonsense.

It killed it, and it is probably why, when actually given the opportunity to make a difference, the left fucked up.

They assume too much. They have no concept of right (as in correct) – independent of left – and wrong.

Still and all, what is this about?

Going back to Iraq, even then if we pressed forward in 1991 we would have had to deal with an armed conflict and the Gulf War 91 coalition would have fallen apart- and it probably would have been us and the US. And, probably would have won Bush senior the second election. And the Al-Qaeda element would still have been in play there. So, the situation would probably have not been much different on the ground but we probably would have had better post war management from Bush Senior Administration than we got from Bush 43.

I, personally would have taken Saddam down in 1991. I’d not have stopped the Force du Frappe from going the last leg. I’d have taken Baghdad, right then and there. We had moral authority back then. He’d invaded Kuwait and upset Sonia. What better reason for finishing it right then?

Frankly, fuck the Arab street, we had right on our side back then, and then we blew it big time. I think you’ll find that Saddam was a bit if a bitch, even prior to Gulf War One, such as making a complete utter tit of himself over Iran? Maybe?

What is your evidence for Al-Quaida in Iraq in 1991?

I don’t think it was on the radar, back then.

Also, if I could recommend a video on the same subject: Money As Debt is well worth watching, and explains fractional reserve banking and it’s flaws in a way almost anybody could understand.

Refresh – apologies I did not mean to insinuate that. I am truly sorry

*********

Douglas

I do respect your views as well. But I think you inadvertently proved me right. When you say-when the West betrayed both the Kurds and the Marsh Arabs, any prospect of democratisation of Iraq – I cannot agree more. We acted cowardly with the Kurds and the Marsh Arabs without doubt.

It was sad and it was hypocritical — it reminds me of our inaction in 1956 when students in Budapest rose up against Soviet Union. Again we fired them up but we did not give them any support. Eisenhower played golf while students who trusted him died in front of tanks.

Going back to Iraq, even then if we pressed forward in 1991 we would have had to deal with an armed conflict and the Gulf War 91 coalition would have fallen apart- and it probably would have been us and the US. And, probably would have won Bush senior the second election. And the Al-Qaeda element would still have been in play there. So, the situation would probably have not been much different on the ground but we probably would have had better post war management from Bush Senior Administration than we got from Bush 43.`

But we failed to act – we failed to act when he authorised rape and pillage and torture and indiscriminate killing of those he was supposed to be protecting.

But we let him get away with genocide and thats why the second Iraq war was just in my opinion.

We screwed up big time on post war management and following a neo con agenda and destroying Iraqi civilian and military administration. If I am correct Blair was against the post war management plan — even his critics agree.

But I think we were right to get rid of Saddam — it was a strategic mistake but morally right. Better late than never.

I always like the stuff you write here. So, if I can criticise something you said without throwing the baby out with the bathwater, as it were, I’d like to press you on this:

And Iraq war was the wrong war at the wrong time but it was a just war. Or I guess the left values Rwandan lives more than they value lives of Kurdish children being gassed to death. Morally we were right, strategically we were wrong. But when we talk about how immoral it was — I say it was hogwash. When people say Saddam could have been removed by other means, read up folks because we have trying for a bloody long time.

No. That, sir is revisionism of the first order. Subsequent to Gulf War One, the US and the UK set up no-fly zones over both the North and South of Iraq. These zones were more successful in the North than the South. Where, essentially, the Kurds were able to establish a seperate identity. So, no more gassing.

Where it all went arse over elbow, morally speaking, was in the call by the CIA. for rebellion in the South, with promises of support that were never forthcoming. That rebellion was crushed. See here:

http://www.usip.org/newsmedia/releases/2002/nb20021125.html

and, perhaps more importantly, here:

http://en.wikipedia.org/wiki/1991_uprisings_in_Iraq

It is quite clear, to me at least, that was when the West betrayed both the Kurds and the Marsh Arabs, any prospect of democratisation of Iraq. Frankly, the words ‘missed opportunity’ do not do it justice. It was a complete betrayal of any sort of decent liberal, or in it’s best sense libertarian, values. It was a treason to any principles of self determination.

It is not, sir, hogwash to say that it is reminiscent of the Soviets’ call for uprisings in Warsaw, complicit with their then standing on the sidelines.

Well, that’s what I think.

But Iraq? More deaths than Rwanda? I think you make a big mistake to suggest the left was ever supportive of Saddam – that’s an old one which I thought had run its course.

Refresh

This is one point I can`t agree with. Traditional Media is biased and has less credibility than politicians. We only refer to media when it supports our personal biases. And media do not report news they highlight their views.

An interesting point: Cameron was attacked for being the man with a plan without the plan. But the Tories did release a 23 page document during their conference which not a single newspaper or News channel actually covered. Whether you agree with it or not, they have a responsibility to report news — which they dont.

Traditional media has actually lost its credibility especially with today`s generation. They want narratives and they want it from the horse`s mouth and without the media editing it – - and they should openly present all sides of the story and from their respective representatives.

And, on this one I should know, because thats exactly the model we are following in Policy Dialogue and its working because most people don`t like pontification, or views apparently coming from an unbiased source.

If they want views they want from the horse`s mouth and the audience is smart enough to judge the validity of their claims. And, BBC refused for a long time to use the word terrorist — for God`s sake and this is an institution that is recognised worldwide as one of the best places to get your news.

Every poll taken in recent times show media ranking below politicians on trust — and you want them to be part of a regulatory framework. Sorry can`t agree with thaté

And Iraq war was the wrong war at the wrong time but it was a just war. Or I guess the left values Rwandan lives more than they value lives of Kurdish children being gassed to death. Morally we were right, strategically we were wrong. But when we talk about how immoral it was — I say it was hogwash. When people say Saddam could have been removed by other means, read up folks because we have trying for a bloody long time. And come on, we got rid of a genocidal dictator and 70% of Iraqi population voted even under death threats. So, the moral argument and trying to equate it with Vietnam is simply wrong. Vietnam was morally wrong — no denying it. But Iraq was morally right.

Historically, in the US, 90% of the wealth has been always been concentrated within the top 2% of the population. But usually there is no resentment for that – rather people like to emulate them. Until now. But still people like Bill Gates, Warren Buffett are widely respected and revered. No one puts down the Kennedy`s for their wealth. And that is a key difference between us in Europe and the USA.

I just checked about 60% of Ivy League Freshmen come from comprehensives. And that tells me a lot but it also tells me the importance of personal responsibility.

Something new Democrats have been talking about and so has recently Obama. (funny, every stump speech of Obama is now how great Clinton was) — But lack of personal responsibility and parental responsibility has harmed generations of African Americans and its not me saying that its African American Leaders saying that.

Personal responsibility and taking advantage of the opportunity has been a cornerstone of American ethos. Government or public policy cannot replace parents or even communities. It takes a village said Hillary Clinton in a book and it does and Government must do its part but it cannot replace personal responsibility.

In the 1990`s when the question of should Bill Clinton continue with the Johnson Executive Order for Affirmative Action or rescind it — he gave a speech headlined `Righteous yet Rocky Journey`and he explained on these particular themes far better than I ever could or for that matter Obama has so far been able to do.

And despite the imperfect union speech, I think I rate Clinton`s affirmative action speech the best one I have heard on race relations and its impact on public policy. He decided that one affirmative action one day must go but explained why that day hasn`t come yet. And the clinching argument was that American Society has failed to help those children who have been left behind not because of any fault of their own but of others. In my last post, I talked about Colin Powell and Condi Rice, and if you look deeper they had strong families and parents who wanted them to achieve and aspire to be something better.

Its a same story we see in many parts of London today. Where parents are involved and wish their children to achieve and aspire for better things, the children tend to do better. Can Government lend a better helping hand – of course. But can government or public policy provide the guidance and support that a child needs in his or her journey towards adulthood. The answer is no and that is where family and communities need to play a big role.

We talk about African Americans and why not Asians both here and in US. People who were cab drivers ensured their children went to Uni — people who work in restaurants as cooks ensured their children went into Uni for a better life — and those children got their through the tools provided by the State — so the State is not always to blame.

Anyway, I am bit tired today so sorry for this long convoluted post. But I think I make my points coherently — I guess so at least

I am all for these so called `know it all` financial engineers to be taken to task and publicly so. I have no sympathies for Hedge Fund Managers who were not interested in creating wealth through job creation and value addition but depended on creating money from nothing but debt.

I have also no problem with legislation being brought in where a small percentage of the hyper -inflated profits of utility companies are directly utilised to bring the demise of fuel poverty in this country. I am, however, against creating a windfall tax category which goes into the Treasury Coffers and very little part of that actually goes to addressing the actual problem.

I have always argued for a fairer tax code. A tax code that is truly fair and is based on true earnings and disposable incomes. A tax code which derives its strengths from reducing indirect taxation burden on those on low and middle income. And, we need political will to do so. I have no problems raising taxes a few percentage points on income over say 150K (based on a family of four).

And, for that we need a vibrant free market economy and not a nationalised industry model. And, I believe the Government and the regulatory authorities have failed in their responsibilities — so I dont see how we can point fingers at the Bankers when we have the same Government who encouraged this stupendous level of unsustainable debt.

But first to fix our economy, we need to reduce our deficit and reduce our 2.5 trillion pounds worth of debt which far surpasses our total GDP. Now that happened because of Government and Bank of England Policy – and so if we ask for prosecution of bankers and hedge fund managers we might have to also hold our elected leaders to account.

The Labour Government which I support have been largely responsible for this mess and they dont deserve any kudos. And definitely not Brown. All this talk of Brown being in a better shape is very short term — as if the debts were called in today — we do not have the money as a nation to pay it off and Gordon Brown has been managing the Treasury one way or the other for 11 years.

I think we agree on major points but I wont say that this is the end of capitalism — I would say this is the end of irresponsible and unaccountable monopoly capitalism that we have developed over the past 20 odd years.

Thanks for the cxplanation. I guess there are many good things about America that we tend to forget in the current climate … And yes, for all Johnson’s faults on Vietnam, he was a great architect for domestic US policies on health, education and employment. I think perhaps also the quest for civil rights in the US was also missed in the period after the ending of the US civil war when much more could’ve been achieved with the right political will. Instead we had to wait until the civil rights movement again in the 20th century. And I’d agree that the New deal era was a good moment in US history for social change.

I’d be interested in checking up the stats on how the Ivy League colleges take in young people from comprehensives because that would be a good indicator of equality across the board.

For me, though, equality is also a relative concept with wealth and income in a country – and so I have higher expectations of equality in a country with higher economic growth.

Which is why we might expect more from America … I haven’t done the research but my gut instincts tell me that US doesn’t measure up well on equality compared with other strong economies in Europe. Now, you point to success in African-American, and indeed, the whole discourse about Obama has been , oh look how well he is doing, being an African-American. My reaction is that why are we suprised? I don’t expect anything less in a country where the history of African American participation has been as long as other Americans. Let’s not forget that African Americans have been in the United States as long as ‘white’ Americans, as America was a new country for everyone, apart from the native Americans.

I don’t take the success of high powered people to be a success of a country or organisation in respect of equalty – when one asks the question we don’t have enough equality in organisation/country – the stock answer is .. oh, but look at so and so individual. It’s not about individuals, it’s about trends and levels of inclusion in proportion to population sizes – and the access and opporunities available for any population. I take your point that you are not excusing the levels of social exclusion we find in many African-American communities in the US.

It’s Black History Month so it might be worth Picklers initiatiing a thread around this.

When such CDOs are backed by assets of dubious value, such as subprime mortgage loans, and lose market liquidity, the bonds and their derivatives are also referred to as toxic debt. Holding such “toxic” assets has led to the demise of several investment banks and other financial institutions during the subprime mortgage crisis of 2007-08 and led the US Treasury to offer to buy those assets in September 2008 to prevent a systemic crisis.’

From a Wikipedia search for Junk Bonds.

I thought we’d been here before, and perhaps rather than accept the slap on the wrist, the bankers renamed their shady dealings. Raises more questions about Standard and Poor and other rating agencies.

see also http://en.wikipedia.org/wiki/Michael_Milken

This from Andrew Rawnsley

‘As well as giving the Prime Minister a new sense of purpose, the crisis has also lifted the morale of his party. Though Labour’s electoral successes owed quite a lot to the debt-fuelled boom years, the party is in an emotionally happier place when financiers are going bust and it can talk about skinning fat cats, taking over banks and regulating markets.

Conversely, this huge market failure poses acute intellectual and political questions for the Tories, the instinctive champions of minimal regulation. They are palpably divided about whether to be the defenders of capitalism or to join in the cry to lynch the bankers.’

http://www.guardian.co.uk/commentisfree/2008/oct/12/gordonbrown-labour

Hopefully soon we shall get David S. article on alternatives and then we can debate the issues you raised in #35. We may even be able to question some of the presumptions of poverty reduction, distribution of wealth and distribution of power, amongst very many other things.

One thing we should never forget, and its very important not to tune out when it is mentioned is Iraq. I used to believe defeat at the hands of the Vietnamese was a deterrent for the US, but hadn’t accounted for the neo-cons who thought they wouldn’t have lost Vietnam if it hadn’t been for the media and those home-grown ‘commies’. The Media being a component in a regulatory framework.

The time to move on is when those responsible have been held to account. Therefore one important reason we should never forget Iraq is deterrence. Another of course is we are still there, and could have easily been in Syria and Iran.

So no apologies whatsoever if from time to time debate has to be reminded of inconvenient facts.

As for finding solutions, I am all for it. My proposed medication for bankers and the City are not a rant, its part of the solution. Trust me, you are not going to get ‘ethical’ behaviour from CEOs and Traders without it. In fact observe over the next few weeks, how many fresh voices join in. From pensioners, those approaching pensionable age, taxpayer organisations, Small Business Federation, Chambers of Commerce, Trade Unions etc. This will be a formidable coalition. Financiers will shortly have no friends, and be left with plenty of time on their hands to finally go seek the fathers they never knew.

And I do believe you will see it translate to other sectors and rather quickly. The windfall taxes on energy companies (for example) will be resurrected, when people realise they will see cutbacks because all the money that should go into their schools is being given to the fatcats on top of the $67bn over 7 years in bonuses.

You were right I was pointing at the New Deal under Roosevelt as the prime foundation of the Government providing a safety net — which was further developed in the Great Society model under Johnson.

Sadly, for Obama, Johnson is not the model but Kennedy who was big on rhetoric short on achievements or even intent. Making a black celebrity walk through the back door of the White House because he had a white wife was Kennedy reality and was far different from his rhetoric. Apologies, I digress again.

But, to me I think the foundation of the American Economic Model is the notion of equal opportunity to succeed. No other country came up with the concept of free and required education before the United States and that has reaped dividends. Similarly, the concept of Pell Grants and other financial tools to ensure higher education was for the many and not for the few have solidified the basis of the American Economic Model. There is no excuse how minorities especially the African Americans have been treated – but less than 50 years after the Equal Opportunities Act we have a Black Man as almost the New President Elect of the United States.

Without a strong governmental framework of opportunities, niether Harry Truman, Ronald Reagan, Bill Clinton or Barrack Obama would have been anywhere near the Presidency of the United States and that speaks volume about a nation. These are all true American dream stories — think about the Kennedys. From bootlegger to President of the United States in one generation — (well I guess with dodgy Chicaogo support again) but still its still inconceivable in most other countries on the planet.

So, to me the American Model has always been far more than the free market. There has been always a strong social safety net and ladder for those who were not born with silver spoons. Still today, most of the Ivy League Insitutions, get most of their students from the American Public School System ie the comprehensive system. That tells me a lot about a country.

The first Afircan American to head the US Armed Forces Colin Powell – went to a comprehensive so did Condoleeza Rice and these were during what I call the apartheid era in the US. This fundamental belief in ability rather than heritage says something about their economic success and model. So just defining American capitalism as free market running wild is not only flawed but does not do justice to any serious analysis of the US model.

Yes – perhaps this is the point that we miss when we talk about US being a model of free market capitalism and China being a model of command and controal: in reality it’s always a mixture – and in Europe and US we find protectionism that historically benefits their national interests against fair competition rules. This is what I find most difficult to absorb – the fact that we don’t actually have free market capitalism in the so-called ‘West’, but say we do, and put up huge trade barriers and tarrifs (depending on where you sit in the world trading regime as a country).

And we dress up our concerns with rights in the developing world as though it’s all concerned with poverty and welfare when much of these motives are economic and relating to national self interest. The US trade unions/farmers for instance, oppose child labour in developing countries, not based on concern for children’s rights it would seem, but because child labour equates to cheap labour and competition.

Let me know if you’ve come across the relative merits of the Washingon Consensus (which many of the big NGOs of the world say hasn’t been helpful for the rest of the world) and the emerging Beijing Consensus which appears to provide an alternative model. Here’s a link from the Foreign Policy Centre.

http://fpc.org.uk/publications/123

There’s a lot of talk about this in policy circles internationally – and in my opinion this issue and its relevance will take on significance in the way that Fukuyama’s book on the End of History did in the early 1990s (proposing the Triumph of Capitalism after the collapse of the Soviet U).

On the US point , if you mean the New Deal and Roosevelt’s quest to secure minimum welfare rights and safety nets, then yes, I’d agree – certainly the famous NHS compact in the UK came along a lot later. And even then it came after the nation forged a unity from the the ravages of war – never again sentitment. At least in the US it didn’t come immediately after a war so to speak – but the great depression.

Speaking of the Great Depression.. None of us were probably around at the time… Wall Street Crash etc is preying on my mind – and I wonder when someone will do a stock take of how significant this crisis is compared with the earlier crash in the 20th century. Maybe some one has and I haven’t seen it yet – out of the loop being in Nepal. Or perhaps the comparative sweep isn’t relevant and raise different issues entirely… I don’t know, am thinking out aloud here.