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Tuesday, June 28, 2005

THE US AND UK ECONOMIES

http://telegraph.co.uk/

In the Sunday Telegraph, 26 June 2005, Niall Ferguson warned Britain's Gordon Brown that 'there are dangers in Mr Greenspan's promised land.'

Niall Ferguson is Laurence A. Tisch Professor of History at Harvard University.

Ferguson wrote:

"There is every reason to believe that the relatively good times Americans have enjoyed in the past decade may be about to come to a painful end.

"What Mr Brown omits to mention when citing the wisdom of Chairman Greenspan is that, since the collapse of the dotcom bubble, the US economy has been running not just on empty but on billions of dollars of credit from Asia.

"This is hardly a strategy Europe should rush to imitate.

"Americans on the East Coast - the sort Mr Brown hangs out with - like to look across the Atlantic and gloat at Europe's problems.

"But the Americans I know on the West Coast look the other way and see China, growing at breakneck speed, bankrolling the US government while at the same time wiping out American manufactures and building up a formidable military capability that will one day challenge American primacy in the Pacific region.

"None of which is to deny the seriousness of the problems facing Europe.

"My advice to Mr Brown is nevertheless to drop that "God Bless America" riff from his speeches."

Niall Ferguson is Laurence A. Tisch Professor of History at Harvard University. His latest book, Colossus: The Rise and Fall of the American Empire, is now a Penguin paperback.

~~~

http://xymphora.blogspot.com/2005/06/new-and-improved-unocal.html

New and improved Unocal

"A company owned by the Chinese government has put in a bid (or here) to buy American oil company Unocal...

"When I think of Unocal, I can't help but think of the Afghanistan gas pipeline, a pipeline which Unocal would be developing if the United States could just get control of the country.

"The Taliban won't deal with an American-owned company, but the Taliban and the Chinese are old friends (something the Chinese don't like to talk about a lot these days), and presumably the Taliban would be delighted to approve the pipeline if Unocal were Chinese-owned...

"Wall Street could start a new line of work, the de-Americanization of companies whose American ownership makes their products unsaleable in much of the rest of the world (and just wait to see how much worse this is after the American attack on Syria or Iran).

"The neocons, through destroying the value of the American brand, have started a new line of financial business where squandered shareholder value can be recovered just by selling American companies to commercial entities that are clearly not American. Removing the American taint can make money for everyone. All hail the financial genius of the neocons!"

~~

Blair tramples on the poor?

http://www.wsws.org/articles/2005/jun2005/blai-j25.shtml

In WSWS 25 June 2005, Julie Hyland wrote about Blair's Britain.

In his speech to the European parliament on June 23 2005, Tony Blair denounced as a caricature “the idea that Britain is in the grip of some extreme Anglo-Saxon market philosophy that tramples on the poor and disadvantaged.”

Hyland presents the evidence that Blair is wrong.

1. In 2005, the Joseph Rowntree Foundation produced a study showing that by 2001-2002, low wages were the leading cause of poverty in the UK, with more than a third of households counted among the “working poor.”

Under Thatcher and Blair, Britain has been transformed into 'a cheap-labour location for the giant multinationals'.

2. The various social policy schemes 'glorified' by Blair 'are essentially a subsidy to employers to enable them to continue paying low wages'.

3. Low wages have helped ensure that British workers work the longest hours in western Europe.

4. Child poverty levels are amongst the highest of the industrialised countries, with more than one in four children officially deemed poor.

5. Low incomes for much of the working class have only been masked by a massive increase in borrowing. The total of personal debt in the UK is now above £1,000 billion. Individual bankruptcies have reached a record high—a 30 percent increase on the previous 12 months.

6. The introduction of university tuition fees and the replacement of student grants with loans mean that young people account for an increasing number of these bankruptcies.

7. Almost 26,000 house repossession orders were granted in the first three months of this year because people could not pay their mortgages, the highest number since 1995.

8. Blair claims that his government has increased levels of investment in public services.

'Much of this takes the form of public-private partnerships, in which the government pays for commercial investors to penetrate lucrative markets in health and education provision that were previously closed to them. The end result is that the state sector is increasingly cash-starved and saddled with ever-rising payments to private investors, undermining the quality of schools and hospital care.'

9. Under Blair, the wealthiest 1,000 people in the UK have seen a 152 percent increase in their fortunes, with the richest 1 percent of the population taking a greater share of national income than at any time since the 1930s.

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