The state vs the speculators

The world financial system may have been bailed out by governments using taxpayers’ money, but the bubble of the derivatives sector has not shrunk one bit. In fact, a significant part of it has been transformed into public debt and, as a result, it has changed the nature of the crisis. Greece, as the weakest link in the eurozone, became a guinea pig in what is a new phase in the global economic crisis and, in order to avoid a similar fate, many European governments are applying austerity measures. In their efforts to push through these measures, the powers that be have evoked the all-too-familiar excuse that societies have been living above their means far too much and for too long. While there is some truth to this, as usual, small truths are being used to put across big lies, because the real issue is who will foot the bill. The mutation of the financial crisis into a public debt crisis is one way to shift the distribution of responsibility. And now the middle class, which is the least responsible for the crisis, is being called upon to pay, while those who are most culpable are going to pay proportionately much less. The distribution of responsibility is just one of the problems. The other is that with the crisis in full swing and social malaise at a peak, the speculators are up to their usual tricks again. They are who they are after all. The responsibility lies elsewhere, because even though the crisis has crushed faith in the market’s ability to regulate itself, governments have failed to take effective measures. The decisions that have been taken by governments mirror the clash that is almost certainly on the horizon. On the one hand there is financial capital and its ideological and political proponents. These forces continue to defend the impunity of the market and, to a great degree, succeed in doing so because, as a rule, they control key positions in the economy and in politics. On the other side, we have a variety of often disparate powers defending the sovereignty of democratically elected governments. Justified by events, these powers are demanding that rules be imposed on the markets. The clash, in essence, is about who will have control over the state and the outcome will determine whether politics or the markets will be at the helm: in other words, whether the fate of society is determined by the elected leadership or the speculators.