Video: Michael Hudson on Democracy Now, July 22, 2011

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Pushing Crisis: GOP Cries Wolf on Debt Ceiling in Order to Impose Radical Pro-Rich Agenda

President Obama and Republican House Speaker John Boehner are allegedly close to a $3 trillion deficit-reduction package as part of a deal to raise the federal debt ceiling before an Aug. 2 deadline. But the deal is coming under fire from both congressional Democrats and Republicans. Part of it calls for lowering personal and corporate income tax rates, while eliminating or reducing an array of popular tax breaks, such as the deduction for home mortgage interest. Some Democratic lawmakers expressed outrage on Thursday because the Obama-Boehner agreement appears to violate their pledge not to cut Social Security and Medicare benefits, as well as Obama’s promise not to make deep cuts in programs for the poor without extracting some tax concessions from the rich. We’re joined by economist Michael Hudson, president of the Institute for the Study of Long-Term Economic Trends, a Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and author of "Super Imperialism: The Economic Strategy of American Empire."

to watch the economist Michael Hudson on Democracy Now, July 22, 2011, click on

demandside's picture
Jul. 31, 2007 4:01 pm


I'm always glad to hear world class economist Michael Hudson's take on things. Afterall, he saved Iceland. with his advice to their government.

From the link: "Bernanke, who essentially said, "We have to save the rich first. We have to save the gamblers." There was plenty of money in all of the banks to cover all of the retail vanilla deposits for businesses, families. What there was not money for was for all the cross-gambles that they had made on derivatives—that is, which way interest rates would go, which way currencies would go. And so, this was really a casino. These were bets. And people like the AIG couldn’t pay. And the question is, how are you going to get the winners in this casino to get money from the losers, who are broke? So these $16 trillion worth of loans were all for junk securities. They weren’t for the solid securities that did back out the deposits. These were all for junk gambles, having nothing to do with the real economy at all.

And the result was that, while many of the $16 trillion have been repaid, there has been a residue of $13 trillion added to the government debt since September 2008, when all of this began. All of this was created simply on a computer keyboard at the Treasury. So the question is, if they can create a $13 trillion on a computer keyboard, taking over Fannie Mae and Freddie Mac, and the Federal Reserve can simply give this money, why can’t they, over 50 years, pay the trillion dollars for the Medicare and the Social Security? It’s—obviously, it’s a charade.

Well, Greece’s should be viewed as a dress rehearsal for the United States. It’s exactly the same thing. Greece didn’t really get any bailout funds at all. All of the bailout funds were given by European creditor governments to the banks that held the Greek bonds. And Greece was told, "Well, there’s a 50 billion euro loss on your bonds that have gone down. You have to sell off and privatize $50 billion of your land and property in the public domain." So every euro that the bankers lose, Greece has to sell off. And the idea is to carve up the government and privatize it, just like Illinois and Chicago and Wisconsin and California are doing. So it’s a dress rehearsal for what’s happening here.

What’s happening across the world is an attempt by the financial sector to really make its move and say this is their opportunity for a power grab. And they’re creating this artificial crisis as an opportunity to carve up the public domain and to give themselves enough money. They’re taking the money and running, because they know that unemployment is going up. The game is over. They know that. And the only question is, how much can they take, how fast?"

Retired Monk - "Ideology is a disease"

Jul. 31, 2007 4:01 pm

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