Readers of this blog would know that I've been a long-time critic of the neo-liberal monetarist economy, in fact for many years, ever since it started really, with Thatcher, and certainly following the Roger Douglas reforms in New Zealand in the early 1980s. Like a steamroller, these absurd policies crushed the opposition and set New Zealand on it's present tragic course. Naomi Klien's fascinating and very depressing book "The Shock Doctrine" explains how the new right Friedmanites and Chicago School economists were able to take advantage of economic and political difficulties (and certainly after Muldoon, these were severe) and push through these extreme policies. Naomi draws a parallel to the psychological experiments of Ewan Cameron, working for the CIA, in what would popularly be called "brain-washing". I would thoroughly recommend this book, but I found it so depressing I couldn't finish it. Others may have a stronger psyche .(24/2/09 Update, "The Shock Doctrine" has just won the first £50,000 Warwick Prize with this citation "Naomi Klein's The Shock Doctrine is a brilliant, provocative, outstandingly written investigation into some of the great outrages of our time. It has started many debates, and will start many more, and we're delighted to award it the first Warwick Prize for Writing." You can read a bit more about this on The Times webpage.)

These new economics became the "perceived wisdom" supported by the media, internationally owned by large corporations with vested interests in this way of running the economy. Criticism was disarmed, and Jim Anderton, remaining true to his Labour principle, resigned from the Labour Party and government. And because these policies became the "norm", criticism, however well constructed and argued, became sidelined. One person who did manage somewhat to make his voice heard was Bruce Jesson. New Zealanders might recall Bruce Jesson's trenchant criticisms over some years, and his book "Only their purpose is mad". Bruce's untimely death in May 1999, shortly after this book was published, was a real loss of a left-wing intellect and activist and effective critic of the capitulation to the market economy. I did buy the book and found his critiques very much mirrored my own, but rather better expressed than I could hope to manage. It is worth remembering too that Bruce Jesson was a succesful chairperson of the Auckland Regional Council in the 1990s and gained much practical experience in running a large organisation, and very he did so very well, demonstrating in a practical manner how left-wing policies, used wisely, can truly succeed. I think was one of the reasons that he could gain a good deal of respect as a left-wing economic and policial commentator. There's a very good perspective on the man by one of the few economists I have respect for, Brian Easton. Another view, a Maori perspective, of Jesson's book can be found here.

Another New Zealander who's contribution to this debate has been worthy, but again sidelined by an antipathetic media, is Bryan Gould. A Rhodes scholar, he made his mark in British politics as a Labour MP, and member of the shadow cabinet. He contested the Labour Party leadership, to be defeated by John Smith. I find that fascinating , what if he'd won? John Smith was to the more to the left of Labour parliamentary caucus, as is Bryan, but John Smith died not long after being elected and his successor was Tony Blair, Christian fundamentalist, poodle of Bush and seller-out of almost all Labour's ethical and economic principles. The Labour Party should have chosen Bryan, at least he was fit, and the sorry saga of the Iraq war and the present shambolic destruction of the UK economy could have been avoided. In 2006 Bryan published a book "The Democracy Sham - How globalisation devalues your vote" in which he argues, cogently, and again I have previously said much the same thing , that capitulation to monetarist dogma and globalisation has emasculated government and their ability to affect change or represent the electors true wishes, as much, of course, as this can truly be measured. I have previously called this "the abandonment of sovereignty". I purchased a copy for myself, supporting a dissenting voice in New Zealand. Bryan Gould returned to New Zealand in 1994, to become Chancellor of the Univeristy of Waikato" from which position he retired in 2004. However he is still very active in public life in various forums. He continues his political interests and runs a blog, which you can find here.

Now the world economy is going into free fall. Because this wasn't predicted by anyone in the political or economic or media establishment, it has come as a great surprise. Indeed the Queen was heard to murmer a question about this last year. So if this came as a surprise, and it did, then the only logical conclusion is that this establishment don't in fact have a clue what it happening, and from that it must also be true that they won't have a clue what to do. They are basically all quacks, having prescribed a naive and thoughtless treatment over the last twenty years to the hapless economic patient, they now face a massive relapse with no working diagnosis, and treatments constrained by their own simplistic thought processes and inflexible attachment to an outdated dogma.

The proof of this is the thoughtlessness with which they are now pumping vast amounts of real money into moribund institutions, it's a panicked response, and the main effort seems to be to return things at least in part, to what we had before. And if there's one thing that should be abundantly clear, any attempt to return things to what they were is futile. And how is this return to the past being managed, by the most massive government intervention on a scale that beggars belief, that in any other situation would be considered extreme socialism or communism, but in our present leaders' hands, is more akin to fascism.

Whatever happens over the next few years there will be only one sure thing, we will be poorer than we were. The measure of society will be to see how honest we are about this, whether we have an open discourse, whether the media still behave in their continued antidemocratic habits, how we look after the most disadvantaged in society, and how we take this opportunity to turn our economy round to a fully sustainable long-term human enterprise. I wrote a letter about this to the Dominion Post yesterday.:



This letter follows an earlier unpublished one on the same theme:



Today on the BBC web site, there's an article "Alternative views of the economic crisis". This explains the Alternative World Forum in Belem, Brazil. The Forum's previous slogan of "Another world is possible", has been suitably altered to meet the changing times "Another world is problable". Policies to try and overcome the present economic crisis would include:

A Green New Deal - a massive investment in the environment sector

A Tobin Tax. - something previously mentioned in my blog Sacrifice and Selfishness in June 05. It works by taxing, at a very low rate, all financial transactions, but has the possibility to fund global development.

The Bank of the South - a banking structure for devlopment in the Third World

Food Soveignty - all nations should have a resilient and productive food and farming infrastructure sufficient to provide the nutritional needs of their own citizens. I suspect this should also include the UK.

Participatory Budgeting. The democratisation of financing.

The article then follows with the thoughts of four of the attendees. I won't summarise here, read the article for yourself. At last though, we are beginning to see some recognition from the media that there might, possibly, be another way of doing things. Why does it take a terrible crisis to show this? There's always another way to do things. When anyone says something like "this lady's not for turning", or "the American way of life is not negotiable" or "there must be a level playing field" you know you are listening to someone who doesn't understand this simple fact, but that shouldn't mean we need to keep our own critical faculties in hibernation.

Today's Domion Post has an article "Green and Rich" which describes the USA's amazing turn around, from the dark ages of Bush to a real stimulus to green policies, a low carbon energy policy and how business has at last woken up to the reality that there's a lot of money to be made competing with the oil and coal barons. This article was originally published in The Times, and it goes on to praise Tory leader, David Cameron, who seems to have had something of a Damascene conversion, and is supposedly getting to grips with the revolutionary prospect of a low carbon economy. You can read the original article here (the Dom Post doesn't archive its content - a major failing of this newspaper.) However, a major note of caution, spending on renewable energy is still only a fraction of the total package, which includes support for corrupt banks, incompetent car manufacturers and expenditure on roads. Right wing government spending is not socialism - it is political expediency, a panicked response from people who don't understand the fundamental and revolutionary issues of our time. But back in the US, one rather more hopeful sign, perhaps, is that President Obama has announced an US$8 billion investment in high speed rail - but that's only 1% of his total stimulus package, and is dwarfed by the "investment" in the moribund car industry of tens of billions of dollars. A few high speed trains are not going to save the US economy.

And here in New Zealand? We don't get it. The ban on fossil fuel generation has gone, carbon trading is back on the drawing board, even the science of global warming is up for debate (!!!) and massive investment in new roading is proposed. The true urgency of all this is completely escaping the government's notice, just as it also escaped Labour's. Godzown New Zealand, a parochial little island marooned in its own shallow ocean of conservatism.