PEN-L message, Re Globaloney, competition and bolloks

Bravo !!! from the rank and file.

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Original message:
                             Globaloney, competition and bollocks
                                        by Rob Schaap
                                        25 February 2001

G'day all,

Whilst scanning the *Australian Financial Review* yesterday, I took down a few
notes and allowed myself some idle thoughts - I sent them to LBO where they
met with the silent contempt they probably deserve. Anyway, on a quiet
Sunday, I thought some Penpals might be interested:

Australia has pushed competition policy pretty hard for a dozen years now, and
it's beginning to reap its rewards. Only the big banks (acting, it seems to
most small customers, as an oligopoly) and the big retailers (of which we have
very few) have been making any money for a while, the white-collar stratum is
being disembowelled in waves of 'restructuring', farmers have lurched to the
far right, the small-business community is becoming a political wrecker of all
parties neoliberal, the stock market is flat, consumers are going massively
into debt to get it while it's hot and Oz's terms of trade are sagging.

Seems to me you can just about choose your economist to explain this.
Marx: as organic composition of capital increases, increased productivity is
manifesting as declining values. Schumpeter: monopolies ride waves better,
their reliable pricing policies can keep the bacilli of recession at bay,
shareholders are more likely to keep the faith, larger budgets for commodity
innovation. Kalecki: Under a laissez-faire system the level of employment
depends to a great extent on the so-called state of confidence. If this
deteriorates, private investment declines, which results in a fall of output
and employment. Keynes: In the event of fiscal policy not preventing
'stagflation' a central bank might adjust interest rates such as to balance
savings and investments through a period of technological change. Oh, and
Schaap: Give blind accumulation its head and it'll blindly run into a wall of
its own blind manufacture.

In fact, now that I see the above, it strikes me as a fairly mutually
compatible integration of ideas ...

Anyway, the only economists who can't come up with the necessaries are the
ones we listen to these days - oh, and about 90% of the world's treasurers and
finance ministers.

And American national accounts go a billion big ones further into the red
every day, its citizens are highly leveraged on the strength of long-gone
market values, and Indonesia and Turkey are threatening to hit banks (I hear
Dresdner and Deutsche are watching Turkey with, um, interest) and general
sentiment pretty hard (oh, and some people'll probably die there - but then
you can't make a pile of broken eggs without breaking some eggs, eh?).

Do I need putting right on any of this?

Shitting in the woods,
Rob.

PS Oh, and I see in my *Australian Financial Review* that Australia's ability
to attract foreign direct investment has collapsed from US12.4 billion in 1995
to $5.7 billion in 1999.

I see also that the US is tipped to attract 27% of the whole world's FDIs over
the next couple of years. An even greater slice of perhaps rather lesser a
pie (funny, that, with all this 'growth' and 'globalisation' the world economy
is having, FDIs are tipped to go down this year from $US1.3 trillion to $700
billion - nearly halved, but not worthy of comment, apparently)

I see also that poor countries are also receiving a declining slice of
these declining FDIs.

I see also that *The Economist's* economic 'intelligence' unit has the
explanation: "Governments would rather blame unemployment, slow growth in
incomes and periods of fiscal stringency on external factors such as
foreign competition rather than on, for example, their own labour market
policies, growth-retarding interventions or earlier episodes of
macro-economically destabilising fiscal excess."

I note that (a) globalisation is not delivering what it promised and (b) that
this does not prove the purveyors of globaloney wrong at all, because (c) it's
our fault (d) again, and (e) we just gotta spread wider (f) again.

I see also that Ulrich Beck has just told an LSE audience that 'the
phenomenon of the nation State being usurped by the illegitimate and
unanswerable forces of global capital was so overwhelming as to necessitate a
redefinition of the whole way sociologists think about power' (today's AFR:
40).

Anyway, make of that lot what you will.

Cheers,
Rob