At the G-20 Summit, French President Nicholas Sarkozy and German Chancellor Angela Merkle are submitting new guidelines aimed at putting down corporate fraud on a world-wide basis. The entire substance of their plan isn't out yet, but on the surface it looks quite promising.
Sarkozy's initiative would extend crackdowns on such fraudulent activities as selling derivatives, hedge-funds, and other economic crimes practiced by Bush and his gangsters. Sarkozy wants to globalise these rules to prevent the massive market manipulations that caused the global economic crisis.
'This crisis is not a crisis of capitalism, but the breakdown of a system that drifted away from capitalism's most fundamental values' Sarkozy said. Finally, a politician who actually gets it.
Wouldn't it be terrific if they banned the worldwide fraud of fractional reserve banking, and while they are at it,the fraud of central bank counterfeiting.
It would---but at least this is a start. I heard recently that some congressmen in Mexico are proposing returning that country to the Silver Standard. The only people who seem mired in the 1930s are American conservatives.
Sadly, a lot of politicians still don't get it. The Atlantic Magazine has an amazing article in its May 2009 issue by Simon Johnson, former Chief Economist of the International Monetary Fund, who reports that the IMF is quite familiar with the economic situation we see today, as it has played out many times before in emerging markets, and is caused by an oligarchy of powerful bankers and politicians who unintentionally engineered the collapse by their own stupidity and greed. See http://www.theatlantic.com/doc/200905/imf-advice for the full article.
The recommended remedy is always the same, but Obama is doing the exact opposite. Reducing debt through government austerity programs, cutting budgets and spending to the bone and allowing or even encouraging failing businesses to fail is the only way to get out of the mess. You don't fix these problems by bailing out bad businessmen, nationalizing whole industries and piling more debt upon debt. The most telling sentence in Johnson's long article is this: "Any business too big to fail is too big to exist." Surprisingly, he enthusiastically embraces more competition among all business sectors as the key to growth and prosperity. You'd almost think he sounds like a free market capitalist if you didn't know he worked for the IMF.
This is also deja vu for anyone who's read "Confessions of an Economic Hit Man" ( http://www.economichitman.com/ ) wherein John Perkins explains how large corporations in the 1950s and 1960s would send consultants like himself to third world countries to propose vastly expensive development projects (dams, power plants, highways, etc.) that could only be financed by plunging the dictators into debt to the IMF, and thus creating the political puppet states we needed to fight the communist menace.
The IMF actually does have a few remaining free-market proponents among its membership; sadly it's been overrun by neocons and corporatists like Paul Wolfowitz, too. But this is a really good article.
Obama does seem to be moving in the opposite direction, which is why Sarkozy and others are gravitating away from the central bank concept; especially the idea of world economies being dependent on a major economic system like the US. It's finally starting to dawn on these world leaders that dependency on the US can easily take the world markets down with it.