Tag: Britain
Obama and the Triumph of the Fabians
by admin on Mar.12, 2009, under Uncategorized
By Michael Filozof
March 08, 2009
In 1945, the United Kingdom implemented a program of change at the hands of a new left wing government. The structure of support built up in previous decades, the way change was sold to the public, outcomes themselves have much to teach us about America’s future.
To most Americans, the iconic image of British strength, resolve, and power is that of the cigar-chomping, bulldog-faced Winston Churchill defiantly growling “we shall never surrender” and “this is our finest hour” as Nazi bombs rained down on London every night during the summer of 1940.
Churchill almost single-handedly saved Britain from defeat at the hands of the Nazis, stepping up to become Prime Minister after Neville Chamberlain resigned in disgrace after diplomatic attempts to achieve “peace in our time” with Hitler proved folly.
But relatively few Americans may be aware that, despite his historic victory over one of the most evil regimes in history, Churchill was unceremoniously booted by British voters when his Conservative Party was defeated within weeks of Germany’s surrender.
What followed marked the beginning of the end for the greatest empire since Rome.
The election of 1945 was a decisive victory for Britain’s Labour Party. Labour gained 394 seats in the 640-seat House of Commons, named Clement Attlee as Prime Minister, and implemented historic changes in Britain, turning a once-great empire into a second-rate socialist welfare state in a span of 20 years.
The Labour government nationalized key industries in Britain, including rail, mining, air transport, utilities, and communications. Labour also created a “cradle-to-grave” welfare state and nationalized medicine with the creation of the National Health Service. Oppressive taxation was enacted to pay for the massive increase in government spending; by the 1970s income and estate taxes on the wealthy had skyrocketed to 80%.
In foreign policy, the Labour government engaged in wholesale decolonization, and the world is much worse off as a result. In 1947 British India was decolonized and partitioned into Hindu India and Muslim Pakistan. The resulting chaos displaced 12 million refugees and caused a million deaths. Sixty years and several wars later the former colonies are nuclear-armed powers, still locked in chronic tension over control of the mountain region of Kashmir.
Burma, Ceylon, and the Palestinian Mandate were also decolonized in the immediate postwar period. Burma — now Myanmar — is home to one of the most repressive military dictatorships in the world. Ceylon, now Sri Lanka, is experiencing a decades-long guerrilla war, and the 60-year Arab-Israeli conflict in the former Palestinian Mandate knows no end. In subsequent decades, Britain also withdrew from East Africa, leaving in its wake the oppressive 30-year dictatorship of Robert Mugabe in Zimbabwe and a tribally-divided Kenya, recently wracked by election violence. Sudan, another former East African possession of the British Empire, is home to the ongoing genocide in Darfur.
By the 1960s, the Labour Party had overturned nearly all of the traditional aspects of a British culture that had been historically staid, stoic, and reserved. Prime Minister Harold Wilson’s government decriminalized abortion and homosexuality, abolished capital punishment, and revised immigration laws to allow large numbers of Third World emigrants to Britain for the first time. Consequently, today’s Britain is a land of social dysfunction, including high rates of drunkenness, property crime, welfare dependency, racial strife, promiscuity and irreligiosity. The illegitimate birth rate in the U.K. hit 50% in 2008, while a mere 10% of the population regularly attends church. Such behavior would have been unimaginable in prim Victorian society a century ago.
Although Britain’s Conservatives managed to form governments in the postwar period, they were unable to fully reverse the changes implemented by Labour. Prime Minister Margaret Thatcher did manage to lower tax rates and privatize some industries in the 1980s, but Conservatives never abolished the welfare state, the NHS, or reversed the social decline that had taken place in the postwar period.
The Britain that strode across the world as an economic and military colossus during the nineteenth and early twentieth centuries - bringing technology, learning, literature, order, and an unprecedented creation of wealth — was gone forever by the 1960s, its culture replaced by a trite and ephemeral trendiness epitomized by Beatlemania, punk rock, and “Cool Britannia.”
The Ideological Clique Behind the Change
These changes did not take place by accident. They were planned by British cultural elites, particularly by members of the Fabian Society, who had worked for over a half-century to promote the policies finally implemented by Labour governments after 1945.
The Fabians advocated a gradual, democratic socialist takeover rather than violent revolution. Fabians sought control over more banal aspects of life — transport, utilities, medicine — that were far less threatening to the general public than the prospect of armed revolution.
The society was named after the Roman general Fabius Maximus, whose tactic was to wait for the ideal opportunity. The society’s motto — “For the right moment you must wait… but when the right moment comes you must strike hard” — is eerily similar to White House Chief of Staff Rahm Emanuel’s sentiment that “You never want a serious crisis to go to waste,” because “crisis provides the opportunity for us to do things that [we] could not do before.”
Fabian Society membership was a Who’s Who of prewar British intellectuals, writers and artists who had rejected classical free-market economics, traditional religion, nationalism and imperialism. They included nerdy academic socialists like Harold Laski and G.D.H. Cole, as well as a motley collection of misfits, pacifists, deviants and utopian radicals.
The writer H.G. Wells, advocate of eugenics and a utopian global state, was a Fabian. Noted for his infidelity, he had an affair with the American eugenicist and founder of Planned Parenthood, Margaret Sanger. Playwright and critic George Bernard Shaw, an advocate of feminism, socialism, and vegetarianism, was a Fabian; he opposed British involvement in World War I but became an admirer of the USSR in the 1930s. “Sexologist” Havelock Ellis, who married a lesbian and was said to only become aroused when watching women urinate, was a member, as was Edward Carpenter, a vegan gay-rights activist and nudist. Economist John Maynard Keynes, whose theories influenced the policies of nearly all Western governments since the 1930s and are in vogue in the Obama administration today, was briefly a member.
The Fabian Society was disproportionately influential in the Labour government of 1945; though the Society numbered only several thousand, more than half of the Labour Party MPs were members. Nearly all leaders of the postwar Labour Party have been members, including Attlee, Harold Wilson, James Callaghan, Neil Kinnock and Tony Blair.
Just as the Fabians influenced the Labour Party agenda, today’s Democratic Party reflects the disproportionate influence of a clique of elite cultural and academic leftists now seeking to implement a socialist agenda they have been promoting since the 1960s. This agenda includes nationalized health care, taxpayer-funded abortion, federal control of education, gay marriage, openly-practicing homosexuals in the military, and much, much higher taxes.
Like the Fabian-influenced Labour government, the Obama administration has embarked on a course to “remake” America. The administration will effectively nationalize transportation and utilities through its “green energy” initiatives (indeed, Congresswoman Maxine Waters recently advocated nationalizing the oil industry) openly seeks to nationalize health care (the $787 billion “stimulus” bill includes billions of dollars to begin centralizing health care records) and is using the mortgage and banking crisis to effectively nationalize the financial services and banking sector.
In foreign policy, the Obama administration has announced a deadline to withdraw all combat troops from Iraq, and indicated a willingness to cease implementation of a missile-defense shield in Europe. Obama, who campaigned as a “citizen of the world” and effectively apologized to Middle Eastern audiences for the U.S. invasion of Iraq in his first televised interview as president, seeks to curtail American military hegemony and replace it with reliance upon global institutions such as the U.N.
On immigration, Obama and the Democratic Party support citizenship for 12 million mostly Spanish-speaking illegal aliens currently residing in the U.S.; such a plan would invariably allow those new citizens to sponsor even more non-English speaking family members to emigrate to the U.S.
The agenda of the American Left bears an uncomfortable similarity to that of the Fabian Society intellectuals that reshaped British society. If this agenda is successfully implemented by Barack Obama, the election of 2008 in the United States will be a watershed event, much like the British election of 1945.
But this analogy is not an optimistic one. If one wants to know what the United States will look like fifty years after Obama, one need only look at the fall of Britain from its imperial height in 1945 to the Britain of today — a second-rate, secularized “nanny state” whose disarmed citizens are monitored by thousands of police cameras and whose police actively prosecute “hate crimes” and offenses against “multiculturalism.”
Like Britain, the United States will almost certainly remain an important financial center and regional power several decades from now, but the center of global gravity will long since have shifted to the Chinese as the United States abandons it global dominance and becomes preoccupied with a liberal, postmodern, domestic agenda. It does not have to be this way — the United States can still assert itself as global hegemon if it has the will to do so - but the successful implementation of the Obama agenda will assure that it does not.
If Obama achieves the goals articulated in his campaign, his presidency will surely mark the end of “the American Century” just as the election of 1945 signaled the end of Victorian and Edwardian British global dominance.
President Blair? - Former PM set to become EU chief
by admin on Mar.12, 2009, under Uncategorized
Tony Blair is poised to become the first President of Europe after it was confirmed that French leader Nicolas Sarkozy is determined to help him win the post.
A senior aide to President Sarkozy told a private gathering of senior British and French politicians that he is to tell fellow EU leaders that Mr Blair is the only man who can help Europe stand up to the rest of the world.
The remark by Alain Minc, a key member of Mr Sarkozy’s inner circle, is the second French blow to Gordon Brown’s standing in two days, coming after Mr Sarkozy said Mr Brown’s decision to combat the recession by cutting VAT was a ‘mistake’.
Mr Minc, a political wheeler-dealer, entrepreneur and TV show host, was attending a meeting last month of the Franco British Colloque, a high-powered discussion group of British and French politicians, civil servants and opinion-formers.
Members are under orders not to reveal the confidential discussions, but The Mail on Sunday has established that Mr Minc used the meeting to win support for Mr Sarkozy’s campaign to ensure Mr Blair becomes the President of Europe.
The role is due to be created next year – but only if the EU’s controversial Lisbon Treaty is ratified in the autumn by Ireland and the Czech Republic, the two EU countries which have so far refused to do so.
Mr Minc told the gathering, which was also attended by French Prime Minister Francois Fillon: ‘When the Lisbon Treaty is ratified, Europe will move into a new phase. Europe will need a strong leader and Nicolas Sarkozy will nominate Tony Blair for the position.’
Mr Minc explained why Mr Sarkozy was determined to overcome opposition to Mr Blair from a handful of EU leaders, notably German chancellor Angela Merkel.
He said: ‘We have to unite and say to Mrs Merkel that we cannot afford not to have Tony Blair, who will be a strong figurehead, is entirely respected around the world and will be a commanding leader at the helm of Europe.’
Mr Minc has been described by one commentator as ‘France’s Peter Mandelson’. Indeed, his AM Conseil consultancy has employed Lord Mandelson as an ‘adviser’ in the past and the two are members of the Policy Network think-tank.
The conference took place in Versailles, days after Mr Blair visited Paris to chair a conference for Mr Sarkozy on the economic crisis, in what was seen as the latest part of a charm offensive to boost his chances of winning the EU presidency.
Mr Blair paid glowing tribute to Mr Sarkozy’s recent performance in the rotating EU presidency, saying: ‘Under his leadership, Europe looked as if it were acting in concert.’
Mr Blair was referred to as Prime Minister Blair throughout – Mr Brown was not even invited.
The post of President of the EU’s Council of Ministers will replace the current system under which the EU nations on a six-monthly basis. Supporters say it is the only way to give the presidency rotates among EU a strong voice.
Critics claim it is another step on the road to a European superstate.
A Wolf in Sheep’s Clothing: The Fabian Society, Communitarianism and the New World Order
by admin on Mar.11, 2009, under Uncategorized
By Matthew D. Jarvie
October 31, 2008
SovereignSentience.blogspot.com
A Wolf in Sheep’s Clothing
The Fabian Society, Communitarianism and the New World Order
This video is a very brief, six-minute introduction to the British Fabian Society, which was established on orders from the Crown in 1884, with the purpose of creating a movement to usher in by stealth a one world government.
The ideology promoted by Fabians and Fabian thinkers is called communitarianism, which is also sometimes referred to (by people like Tony Blair) as the ‘Third Way’. The Third Way refers to the synthesis of capitalism and socialism in the dialectic scheme.
This dialectical synthesis, or outcome, is to be a collectivist form of government where all individualism is forcibly relinquished in the name of “unity” and complete and unwavering allegiance to the state under a scientific, socialistic dictatorship run by “experts.”
This is to be a system run on complete and total efficiency, where the only purpose of the individual is to serve the state. The so-called “useless eaters,” as people like Kissinger refer to, are seen as only a burden to this efficiency, and therefore will be incarcerated or killed if this system is allowed to be fully implemented. This is precisely why the “Elite” want an 80-90% reduction of the world’s population, with just enough peasants to serve their utopia, described in writings by people such as Huxley and Fabian H.G. Wells, and promoted still today in well-funded works of propaganda such as Zeitgeist, which are designed to promote the New World Order religion.
A Wolf in Sheep’s Clothing: The Fabian Society, Communitarianism and the New World Order
The Federal Reserve is Bankrupt How Did It Happen and What are the Ugly Consequences?
by admin on Mar.11, 2009, under Uncategorized
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By Matthias Chang
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Global Research, March 10, 2009
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The Federal Reserve is bankrupt for all intents and purposes. The same goes for the Bank of England! This article will focus largely on the Fed, because the Fed is the “financial land-mine”. How long can someone who has stepped on a landmine, remain standing – hours, days? Eventually, when he is exhausted and his legs give way, the mine will just explode! The shadow banking system has not only stepped on the land-mine, it is carrying such a heavy load (trillions of toxic wastes) that sooner or later it will tilt, give way and trigger off the land-mine![1] In a recent article, I referred to the remarks of British Prime Minister Gordon Brown and President Obama calling for the shadow banking system to be outlawed. Even if the call was genuine, it is too late. The land-mine has been triggered and the explosion cannot be averted under any circumstances. The only issue is the extent of the damage to the global economy and how long it will take for the world to recover from this fiasco – a financial madness that has no precedent. The great depression is “Mary Poppins” in comparison! The idea of a central bank going bankrupt is not that outlandish. I am by no means the first author who has given this stark warning. What underlies this crisis (which I initially examined in an article in December 2006) is the potential collapse of the global banking system, specifically the Shadow Money-Lenders. Nouriel Roubini, the New York University professor said [2]:
Please read the underlined words again. “Sovereign bank” means central bank. When a central bank “cracks” i.e. becomes insolvent, “all hell breaks lose”, because as the professor correctly pointed out, “any government guarantees will ring hollow and will be useless”. If a central bank goes belly up, it is as good as the government going bankrupt. Period! In another article, Roubini admitted that the pressure on “the financial land-mine” is totally unbearable. He wrote: “The US Financial system is effectively insolvent”. It follows that if the financial system is bankrupt, it is a matter of time before the “sovereign bank” goes belly up. This is a given! He stated further that:
McClatchy newspaper reported (03/08/2009) bad news affecting the banks:
Berkshire Hathaway Chairman, Warren Buffett is so livid by the sheer magnitude of the financial mess that he said:
The above bad news refers to the losses and potential losses that the big banks have suffered and will suffer in the near future. But what is overlooked by many financial analysts is that these very same derivative products have caused another financial organ failure. And there is no way that the said organ can be resuscitated to its former state of health.
The Repo Market is gridlocked! There has been an incestuous relationship between the traditional banking system and the shadow banking system and the link that joined the two together is the Repo Market.[Repurchase Market] This is in fact the weakest link in the entire financial system. This is a very technical subject and I seek your indulgence and patience when reading the remaining part of this article. The gridlock of the repo market is the basis for my assertion that over and above the aforesaid dire financial facts, it is the major contributing factor to the bankruptcy of the Federal Reserve! I want to use a simple analogy. This will make the issue easier to understand. Picture a one-inch diameter thick rope. Such a rope is made up of a few strands of narrower ropes, say 1/10th inch which are twined together to make the thick one-inch diameter rope. Picture again that all the outer strands have been burnt away, and what remains is the middle strand, still lifting the weight. But this strand cannot on its own, lift such a weight and sooner or later, it will snap. When that happens, the weight will come crashing down! The middle strand is the repo market. Alternatively, you can use the analogy that the repo market is the heart that pumps the blood (the cash flow). The financial system is the body and it has suffered a massive heart attack! What is the repo market? The repo market is the market whereby all financial institutions (regulated and unregulated) invariably go to obtain financing to meet reserve requirements, bridging finance, to lend or purchase securities, to hedge and or to invest on short-term basis. It used to be that mainly US Treasuries (bear this in mind at all times) were used as security for Repo transactions, as it is considered as most secure i.e. as good as cash since it is backed by the credit of the US government! This requirement is no longer the case. More of this issue later. The Nature of Repo Transactions In repo transactions, securities are exchanged for cash with an agreement to repurchase the securities at a future date. The securities serve as collateral for what is effectively a cash loan. A distinguishing feature of repos is that they can be used either to obtain funds or to obtain securities. As repos are short-maturity collateralized instruments, repo markets have strong linkages with securities markets, derivative markets and other short term markets such as inter-bank and money markets. [3] Like other financial markets, repo markets are subject to credit risks, operational risks and liquidity risks. However, what distinguishes the credit risks on repos from that associated with uncollateralized instruments is that repos credit exposures arise from volatility (or market risk) in the value of collateral. Bear this in mind at all times. Repos allow institutions to use leverage to take larger positions in financial markets which could add to systemic risks. Bear this in mind at all times. And because of the close linkages between repo markets and securities markets, any shocks will be transmitted quickly, resulting in a gridlock. Bear this in mind at all times. Transactions covered by definition of repos are as follows:
(A) Repurchase Agreement A repurchase agreement involves the sale of an asset under an agreement to repurchase the asset from the same counter-party. Interest is paid on the repurchase agreement by adjusting the sale and purchase price. A reverse repo is the purchase of an asset with an agreement to re-sell the same or a similar asset.
A hold-in-custody repurchase agreement is a trade whereby the repoer (the borrower of cash) continues to hold the collateralizing securities in custody for the lender of cash. The risks are obvious!
A deliver-out repurchase agreement is where securities are delivered to the cash lender for custody in exchange for cash.
A tri-party repurchase agreement is similar to a deliver-out repurchase agreement, except that the security is placed in the custody of a third-party entity. The third-party ensures that the security meets the cash lender’s requirements and provides valuation and margining services. This is the primary form of repurchase agreement for securities dealers in the United States. Bank of New York and JP Morgan Chase are the two main custodians or clearing banks in the US and supervise the vast majority of the tri-party repos. Bear this in mind at all times.
(B) Sell/Buy-Back Agreement A sell buy-back is two distinct outright cash market trades, one for forward settlement. The forward price is set relative to the spot price to yield a market rate of return.
(C) Securities Lending This is where the owner of the security lends them to another person in return for a fee. The borrower of the security is contractually obliged to redeliver a like quantity of the same securities, or return precisely the same securities. Repos can be of any duration but are most commonly over-night loans. Repos longer than over-night are called Term Repos. There are also Open Repos which are transactions which can be terminated by both parties on a day’s notice. The largest players of repos and reverses are the dealers in government securities. There are about 20 primary dealers recognised by the Fed which are authorised to bid for new-issued treasury securities for resale in the market. The dealers are highly leveraged, 50 to 100 times their own capital. To finance the purchase of treasury securities, the dealers need to have repo monies in large amounts on a continuing basis. The institutions that supply such huge funds in the repo market are money funds, large corporations, state and local governments and foreign central banks. The Repo Market and the Financial Crisis As stated earlier when the repo market first started, US treasuries were the preferred security. But when financial engineering exploded and many financial products (i.e. CDOs) were rated AAA by rating agencies, these securities were also traded as described above in the repo market. This was when problems started. According to Gary Gorton [4], the repo market before the crisis was estimated to be worth a whopping $12 trillion as compared to the total assets in the entire US banking system of $10 trillion. The former CEO of Federal Reserve Bank of New York (NYFRB) and now the US Treasury Secretary, Tim Geithner observed in 2008:
Economic historians will argue for another century as to the cause for the run on the repo market. The collapse of Bear Stearns is as good a starting point as any. When the market discovered that its securities were duds, pure junk, shock waves ripped through the system. Recall that I had mentioned earlier that Federal Bank of New York and JP Morgan Chase were the primary clearing banks for repos. The Fed’s rescue of Bear Stearns through JP Morgan was not so much to save the former but rather to shore up the “clearing system” of the repos for which JP Morgan Chase and the Bank of New York were the main pillars. One of the functions of a “clearing bank” for repos is to value and match securities tendered for cash borrowings. If Bear Stearns securities are now valued as junks, the integrity of JP Morgan and Federal Bank of New York as clearing banks in this market is as good as zero! And bearing in mind that the five major investment banks in the US rely heavily on the repo market for their funding, any gridlock in this part of the shadow banking system would tear wide open the entire banking system, including the traditional counter-part. Hence, the FED intervention by the creation of the Primary Dealer Credit Facility (PDCF) which was in effect the backstop for all investment banking using tri-party repos! This was what Bernanke said:
Louis Crandall, economist at Wrightson ICAP observed:
The inherent weakness of tri-party repos is that the counter-party risks of billions worth of funding agreements are shouldered by essentially two players – Federal Bank of New York and JP Morgan Chase. Yet, way back then, they were held up as rock solid. It is almost hilarious to read the then advert of the Federal Bank of New York as to their expertise and service:
Panic swept across the entire repo market. No securities were considered safe enough for repos except US treasuries. Fundings in the repo market grind to a halt. Market players withdrew funds and began hoarding treasuries. The rest who own structured products were slaughtered. I would like to quote Gary Gorton again:
This change led to a sharp increase in the demand for government securities for repo transactions, which was compounded by significantly higher safe-haven demand for US Treasuries and the increased unwillingness to lend such securities in repo transactions. As the crisis unfolded, this combination resulted in US government collateral becoming extremely scarce. [6] I will now turn to the issue of the FED’s solvency. As has been observed, the Fed intervened aggressively to check the run on the repo market. Various measures were taken, but in my view the most dangerous was the widening of the collaterals which the Fed was willing to accept to secure funding of the players in the repo market. The Fed also intervened by lending a huge chunk of its US treasuries in exchange for junks to facilitate credit expansion.
In the result, what happened was that the Fed’s present balance sheet of approximately $2 trillion is made up mostly of junk securities. The Fed is no different from banks in that confidence in the quality of its assets is critical and that if and when the market recovers, there is in fact a market for the junk assets that it took on to unravel the gridlock in the financial markets. By way of analogy, if your high street bank’s balance sheet is made up of junk, what would you do? There are just not enough assets to meet its liabilities. But of course, one can argue that the Fed is not your high street bank. It is the central bank of the mighty USA. It will always be able to “print money” or “digitalise” money and keep the markets going. But beware that the Federal Reserve Note is mere paper, fiat money which cannot be redeemed for anything tangible such as gold. And although it is stated boldly in the notes issued - “In God we trust” - you and I are not actually placing our trust in God when accepting the Federal Reserve Notes as “money”. When Joe Six-Packs realises that the Federal Reserve Note is not even secured by US treasuries and or the FED has real tangible assets, but its balance sheet is littered with junks and toxic waste, there will be a run on the Fed i.e. when Americans and foreigners no longer have faith in the Federal Reserve Notes as “money”. If confidence could vaporise in a second and cause a stampede in what was once considered solid security, the triple A rated bonds in the repo and money markets, the same confidence that is now reposed in the Federal Reserve Notes can likewise disappear into the memory hole. All these years, the con was maintained by the Fed that it was solid because it has on its balance sheet over $800 billion of US treasuries i.e. its notes “were so-called backed by these treasuries”. It could sell its treasuries in the repo market for cash and thereby control the money flows in the economy and vice versa. In their subconscious mind, Americans and stupid foreign central banks and their executives (brain-washed by the Chicago School of Economics) somehow believe in the infallibility of the Fed. Now it has been exposed that the Fed’s “assets” comprise of junk bonds and toxic wastes. The Emperor has no clothes! Paul Volcker, former Chairman of the Federal Reserve may have given the ultimate epitaph: “The bright new financial system – for all its talented participants, for all its rich rewards – has failed the test of the market place.” And it is any wonder that Professor Nouriel Roubini declared:
In my opinion, the Fed has already become “unglued”. Whatever guarantees given to secure the indebtedness of CitiGroup and others to prevent a run on these banks are useless. It is bankrupt! End Notes [1] There are two banking systems in existence today. The Traditional Banking System – i.e. High Street banks and the Shadow Banking System. But the players in both the systems overlap because, the major banks of the traditional system helped spawn the shadow banking system. In fact they are the key players in the use of the so-called “new financial products, the CDOs, CLOs, MBS” etc and which have now turned toxic – worthless, junk to be exact. Matthias Chang is a prominent barrister, author and analyst of the New World Order based in Malaysia.
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Queen of England Supporting World Government and Agenda 21
by admin on Mar.05, 2009, under Uncategorized
Gordon Brown calls for new world order to beat recession
by admin on Mar.04, 2009, under Uncategorized
Prime Minister Gordon Brown will today set out a five-point plan to create a “stronger and more just” world order in the wake of the worst financial crisis since the Great Depression
By Nick Allen
Last Updated: 1:51PM GMT 11 Nov 2008
Mr Brown will call on fellow world leaders to use the current worldwide economic downturn as an opportunity to thoroughly reform international financial institutions and create a new “truly global society” with Britain, the US and Europe providing leadership.
His call comes ahead of an emergency summit of world leaders and finance ministers from 20 major countries, the G20, in Washington next weekend.
Mr Brown will say that the Washington meeting must establish a consensus on a new Bretton Woods-style framework for the international financial system, featuring a reformed International Monetary Fund which will act as a global early-warning system for financial problems.
The original Bretton Woods agreements, signed in Bretton Woods, New Hampshire in 1944, established post-war international monetary protocols governing trade, banking and other financial relations among nations, including fixed exchange rates and the IMF.
Mr Brown’s plan for strengthening the global economy 60 years later involves recapitalisation of banks to permit the resumption of normal lending to households and businesses, better international co-ordination of fiscal and monetary policy and a new IMF fund to help struggling economies and stop financial problems spreading between nations.
He also wants agreement on a world trade deal and reform of the international financial system based on principles of “transparency, integrity, responsibility, sound banking practice and global governance with co-ordination across borders”.
As Britain moves into a painful recession Mr Brown has staked his own leadership on helping to find a way out of the global crisis.
In a speech to City financiers at the annual Lord Mayor’s banquet in London he will say: “The British Government will begin to begin a new Bretton Woods with a new IMF that offers, by its surveillance of every economy, an early warning system and a crisis prevention mechanism for the whole world.
“The alliance between Britain and the US, and more broadly between Europe and the US, can and must provide leadership, not in order to make the rules ourselves, but to lead the global effort to build a stronger and more just international order.
“My message is that we must be internationalist not protectionist, interventionist not neutral, progressive not reactive and forward-looking not frozen by events. We can seize the moment and in doing so build a truly global society.”
Mr Brown has already discussed IMF reforms with French President Nicolas Sarkozy and German Chancellor Angela Merkel and has called on countries including China and the oil-rich Gulf states to fund the bulk of an increase in the IMF’s bailout pot.
The Prime Minister wants the markets to be subjected to morality and ordinary people’s interests are put first.
He believes that in electing Barack Obama, US voters have showed their belief in a “progressive” agenda of government intervention to help families and businesses through the current crisis.
He will say: “Uniquely in this global age, it is now in our power to come together so that 2008 is remembered not just for the failure of a financial crash that engulfed the world but for the resilience and optimism with which we faced the storm, endured it and prevailed.”
However, the head of the IMF played down expectations of a new Bretton Woods system ahead of the G20 summit.
Dominique Strauss-Kahn, the IMF’s managing director, said: “Expectations should not be oversold. Things are not going to change overnight. Bretton Woods took two years to prepare. A lot of people are talking about Bretton Woods II. The words sound nice but we are not going to create a new international treaty.”
The European Union has called for an overhaul of the IMF with French President Nicolas Sarkozy, whose country holds the EU’s rotating presidency, saying: “We want to change the rules of the game”.
The US, however, has been more lukewarm on the possibility of radical change.
Obama Meets With British Prime Minister Brown
by admin on Mar.03, 2009, under Uncategorized
CQ Transcripts Wire
Tuesday, March 3, 2009; 1:48 PM
PRESIDENT BARACK OBAMA: Hello, everybody. Good to see you. Where — where are the Brits? (UNKNOWN): They’re over here.
OBAMA: They’re over there, huh?
BRITISH PRIME MINISTER GORDON BROWN: In fact, Barack, they’re everywhere.
OBAMA: Are they? They’re spread out?
All right. My understanding is, we’re going to do four questions. And we’ll just alternate. I’ll start off with Jennifer Loven of A.P.
QUESTION: (OFF-MIKE)
OBAMA: You know, I think that the report that was in the New York Times didn’t accurately characterize the letter. What we had was a very lengthy letter talking about a whole range of issues, from nuclear proliferation to how are we going to deal with a set of common security concerns along the Afghan border and — and terrorism.
And what I said in the letter is the same thing that I’ve said publicly, which is that the missile defense that we have talked about deploying is directed towards not Russia, but Iran. That has always been the concern, that you had potentially a missile from Iran that threatened either the United States or Europe.
And what I said in the letter was that, obviously, to the extent that we are lessening Iran’s commitment to nuclear weapons, then that reduces the pressure for — or the need for a missile defense system. In no way does that in any — does that diminish my commitment to making sure that Poland, the Czech Republic, and other NATO members are fully enjoying the partnership, the alliance, and U.S. support with respect to their security.
So the way it got characterized, I think, was as — as some sort of quid pro quo. It was simply a statement of fact that I’ve made previously, which is, is that the missile defense program, to the extent that it is deployed, is designed to deal with not a Russian threat, but an Iranian threat.
QUESTION: (OFF-MIKE)
OBAMA: Oh, we — well, we’ve had a good exchange between ourselves and the Russians. I’ve said that we need to reset or reboot the relationship there.
Russia needs to understand our unflagging commitment to the independence and security of countries like a Poland or a Czech Republic. On the other hand, we have areas of common concern, and I cited two examples, the issue of nuclear nonproliferation and the issue of terrorism. And at this point, I think we probably have some potential common concerns on the world economic front, as well.
So my hope is, is that we can have a constructive relationship where, based on common respect and mutual interest, we can move forward. BROWN: Nick?
QUESTION: Nick Robertson, BBC News. Mr. President, it’s often been said that you, unlike many of your predecessors, have not looked towards (ph) Europe, let alone Britain. Can you just respond to that comment?
And, also, the prime minister is talking to you about a global New Deal today. Will that actually help hard-pressed American consumers?
And if — if may briefly put a question to the prime minister…
OBAMA: Well, first of all, the special relationship between the United States and Great Britain is one that is not just important to me; it’s important to the American people.
And it is sustained by a common language, a common culture. Our legal system is directly inherited from the English system. Our system of government reflects many of these same values. So — and, by the way, that’s also where my mother’s side of my family came from.
So I think this notion that somehow there is any lessening of that special relationship is misguided. You know, Great Britain is one of our closest, strongest allies. And there is a link, a bond there that will not break. And I think that’s true not only on the economic front, but also on issues of common security.
OBAMA: And, you know, in our conversations here, we talked not only about the need to coordinate around economic policy, but also I expressed to the prime minister America’s extraordinary gratitude for their support in our efforts in Afghanistan and the young men and women of Great Britain, who’ve made enormous sacrifices there.
The — although there — you know, there was a debate obviously around the issue of Iraq, nevertheless, whether you were for or against the war here in the United States, the recognition of Great Britain’s friendship and standing tall with us during that period is something that will never be forgotten. And so rest assured that the relationship is not only special and strong, but will only get stronger as time goes on.
QUESTION: (OFF-MIKE)
BROWN: Let me — let me just thank President Obama for his — for his welcome, for his hospitality, for his leadership of this country, and the inspiration he’s giving the world at this very difficult time.
And I’ve come here to renew our special relationship for new times. It’s a partnership of purpose. It’s a partnership of purpose that is born out of shared values. It’s a partnership of purpose that is founded on a determination to rise to every challenge.
And I think it’s a partnership of purpose that is driven forward now by the need for us all to work together in unity to deal with the world economic problems.
And I’m grateful for the conversations I’m having with President Obama about this and about other things and grateful, too, that Michelle and Sarah will be meeting later this afternoon. And I know they’ll have an enjoyable time, as well.
OBAMA: Absolutely.
QUESTION: (OFF-MIKE) your chancellor has said overnight that it is our collective responsibility (OFF-MIKE) is that a form of apology from the government? Are you apologizing for the problems (OFF-MIKE)
BROWN: Well, there’s got to be big regulatory change. We’ve — we’ve just been talking, Barack and I, about the need for proper supervision of shadow banking systems, of areas where there was bank practices that were unacceptable, where remuneration policies got out of hand and weren’t based on long-term success, but on short-term deals.
And these are the changes that we’ve already announced that we are going to make. So we’ve learned from what has happened over these last 10 years. Things have happened in every part of the world that we’re having to learn about, as well.
And you’ve got an international financial system that we’ve now got to show can be brought to work in the public interest. So every country is learning, and every country is taking action. And what we’re talking about today is how, by us taking action, Britain and America, we can help other countries join us in making for a more stable and effective financial system.
OBAMA: Kara (ph)?
QUESTION: Thank you, Mr. President. The stock market has fallen to lows not seen since 1997 (OFF-MIKE)
OBAMA: Well, let me say this. I’m absolutely confident that they will work, and I’m absolutely confident that credit’s going to be flowing again, that businesses are going to start seeing opportunities for investment, they’re going to start hiring again. People are going to be put back to work.
What I’m looking at is not the day-to-day gyrations of the stock market, but the long-term ability for the United States and the entire world economy to regain its footing.
And, you know, the stock market is sort of like a tracking poll in politics. You know, it bobs up and down day to day. And if you spend all your time worrying about that, then you’re probably going to get the long-term strategy wrong.
Now, having said that, the banking system has been dealt a heavy blow. It has to do with many of the things that Prime Minister Brown alluded to: lax regulation, massive over-leverage, huge systemic risks taken by unregulated institutions, as well as regulated institutions.
And so there are a lot of losses that are working their way through the system. And it’s not surprising that the market is hurting as a consequence. You know, in fact — you know, I think what we’re seeing is that, as people absorb the depths of the problem that existed in the banking system, as well as the international ramifications of it, that, you know, there’s going to be a natural reaction.
OBAMA: On the other hand, what you’re now seeing is — is profit and earning ratios are starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it. I think that consumer confidence, as they see the American Recovery and Reinvestment Act taking root, businesses are starting to see opportunities for investment and potential hiring.
We are going to start creating jobs again. One of the things that Prime Minister Brown and I talked about is, how can we coordinate so that all the G-20 countries, all the major countries around the world, in a coordinated fashion, are stimulating their economies? How can we make sure that there are a common set of principles, in terms how we’re approaching banking, so that problems that exist in emerging markets like Hungary or the Ukraine don’t have these enormous ripple effects that wash back onto our shores? And we’re providing them with some help in a coordinated international fashion, as well.
All of those steps, I think, are going to slowly build confidence, but it’s not going to happen overnight. And — and my main message to the American people is to just recognize that we dug a very deep hole for ourselves. There were a lot of bad decisions that were made. We are cleaning up that mess.
It’s going to be sort of full of fits and starts, in terms of getting the mess cleaned up, but it’s going to get cleaned up. And we are going to recovery, and we are going to emerge more prosperous, more unified, and I think more protected from systemic risk having learned these lessons than we were before.
BROWN: I think President Obama’s absolutely right. And I think the history books will record that what he has done in his first nearly 50 days of office has been momentous in setting the means by which we can see the economic recovery happening.
We’ve had a global banking failure, and it’s happened in every part of the world. It’s almost like a power cup (ph) that went right across the financial system, and we’ve got to rebuild that financial system. We’ve got to isolate the bad assets. We’ve got to underwrite the financial system so that loans can start again to businesses and — and families. And we’ve got to get enough lending into the economy so that people — enough credit so that people are able to go about their normal business again.
And that’s why we’re looking ahead to the G-20 in London in April, because a bad bank anywhere can affect good banks everywhere. So we’ve got to root out the problems that exist in other parts of the world, as well, set principles for the banking system for the future, and make sure that the banks subscribe to lending agreements where they actually increase the lending that is available to — to citizens in every country.
OBAMA: One last one.
QUESTION: (OFF-MIKE) should all governments at this point acknowledge mistakes of policy and regulation (OFF-MIKE) would that be helpful or unhelpful in general? And can I just ask you, an awful lot of ink is used describing the individual relationships between prime ministers and presidents (OFF-MIKE) ask you describe how (OFF-MIKE) working with each other?
OBAMA: Well, I will say that this is my third meeting with — with Prime Minister Brown, and I’d like to think that our relationship is terrific. And I’m sure he won’t dispute me, in front of me, anyway.
The — look, I think that the prime minister has taken the helm of the British economy at a very difficult time. As he noted, I’ve just come in recently. But I think that there are a set of shared values and shared assumptions between us, that we believe in the free market, we believe in a government that is not overbearing and allows entrepreneurs and businesses to thrive, but we also share a common belief that there have to be sufficient regulatory structures in place so that the market doesn’t spin out of control.
OBAMA: I think, on the international front, we have a shared worldview that it is important for us to be true to our values and ideals, of rule of law, of a belief in human rights, a belief in — in our democratic practices, but that we also have to be respectful around the world and to listen and not simply dictate, that, in this new world that we live in, the way to get things done is to build partnerships and alliances as opposed to acting unilaterally.
So I think both on the economy and both — and on foreign policy, we’ve got a shared worldview that allows us to work together very effectively.
And he also has a wonderful family, as I do, so we can always talk about our — our spectacular wives and our wonderful children.
With respect to the first part of your question, look, I think there is no doubt that, setting aside who’s to blame, that in the past there have been some mistakes and lessons learned in terms of how we deal with the financial sector.
Globalization can be an enormous force for good. And one of the things that we’ve talked about repeatedly is that countries in this crisis cannot start turning inward and try to erect protectionist barriers. We should encourage trade.
The fact that we have a global capital system allows money to flow to areas that previously couldn’t get capital. That allows them to develop and to grow. That can grow the economy worldwide, increase trade, and that potentially benefits everybody.
But what is also true is, is that when you’ve got trillions of dollars that can now move at the speed of light, when you’ve got a whole series of unregulated pools of dollars outside of the banking system, but we still have a 1930s’ regulatory system in place in most countries designed from the last great crisis, that we’ve got to update our institutions, our regulatory frameworks, so that the power of globalization is channeled for the benefit of ordinary men and women so that they have jobs, they can purchase a home, they can send their children to college, and prosper and thrive, and — and that the benefits of globalization aren’t just for a small handful of people who are not accountable.
And — and that’s the kind of transformation that we’re, obviously, trying to bring about here in the United States, and I suspect that that’s a view that Gordon shares. BROWN: I’ve enjoyed every conversation that we’ve had, both by the telephone and when we’ve met. I don’t think I could ever compete with you at basketball. Perhaps tennis.
OBAMA: Tennis, I hear you’ve got a game.
BROWN: Yes, we could maybe have a — have a shot.
OBAMA: We haven’t tried it yet.
BROWN: I don’t know. I think you’d be better, but there we are. As far as the common interests that we’re pursuing, look, there is the possibility in the next few months of a global New Deal that will involve all the countries of the world in sorting out and cleaning up the banking system.
And there is the possibility of all the different countries of the world coming together to bring (ph) the expansion in the economy that is necessary to both restore confidence and to give people jobs and growth and prosperity for — for the future.
And there is the possibility of the international institutions for the first time being reformed in such a way that they can do the job that people want them to do and deal with some of the problems that exist in the poorest countries of — of the world.
And there’s a chance, also, that the recovery that we’re talking about can be a green recovery, a low-carbon recovery, where each country in different parts of the world can work on this together.
So the opportunities are there. I’ve said to the president that almost every leader I meet wants the best possible relationship and the most highest degree of cooperation for the future. And so the challenges are momentous and global. The response of leaders around the world is to want to work together.
And I believe that we can make a contribution not just to each of our own economies, but make a contribution to the world economy, helping each economy, if we can actually work together. And that’s why our talk about the G-20 is very important. We hope to make progress on April the 2nd.
And as far as regulation, I — I want the regulatory system to be reformed to meet the needs of our times. When we made changes in 1997, we made changes for the times of 1997. The financial markets have moved global since then, and we need a global means of bringing people together so there’s proper supervision of the system.
You don’t want shadow banking systems. You don’t want regulatory and tax havens. So we’ve got to act as a world together to deal with that. And that’s one of the things we’ll be talking about in April in London.
QUESTION: (OFF-MIKE) Pakistan terror attack (OFF-MIKE) in particular, Mr. President, have made it clear that (OFF-MIKE) see Afghanistan and Pakistan together. How do you think that the world community can support Pakistan?
OBAMA: Well, the details are still coming in, and so I don’t want to be too specific.
(CROSSTALK)
OBAMA: Well, obviously, we’re deeply concerned. But let me just make a general statement.
Both Great Britain and the United States share a deep interest in ensuring that neither Afghanistan nor Pakistan are safe havens for terrorist activity. And we have coordinated effectively in the past, but the truth is, is that the situation in Afghanistan has deteriorated. The safe havens for Al Qaida remain in the frontier regions of Pakistan.
And we are conducting currently a comprehensive review of our policies with respect to Afghanistan, with respect to Pakistan, our coordination with our NATO allies and other members of the international security forces that are there.
I will be making a series of announcements prior to the NATO summit that immediately follows the G-20 summit in terms of the direction that the United States would like to go. What I’m confident in is that our strongest partner in that effort, once again, will be the United Kingdom and — and the prime minister sitting next to me.
OK? Thank you, guys.
QUESTION: Thank you.
END
Gordon Brown New World Order Speech
by admin on Mar.03, 2009, under Uncategorized
World needs new Bretton Woods, says Brown
by admin on Mar.03, 2009, under Uncategorized
LONDON (AFP) — World leaders must meet to agree a new Bretton Woods system, Prime Minister Gordon Brown said on Monday, referring to the global financial architecture established at the end of World War II.
Speaking as the government announced its latest move to try to stabilise the creaking banking system, Brown said the current crisis should be seen as an opportunity to push through delayed reforms.
“Sometimes it takes a crisis for people to agree that what is obvious and should have been done years ago, can no longer be postponed,” he said in a major speech on the fast-moving world financial crisis.
“We must create a new international financial architecture for the global age,” adding: “We must have a new Bretton Woods — building a new international financial architecture for the years ahead.”
The Bretton Woods system was agreed at the end of World War II. It set in place the world’s financial architecture, which remains in place today, based on the International Monetary Fund (IMF) and the World Bank.
Brown said: “While the founders of Bretton Woods devised rules for a world of limited capital flows, we must devise new rules for a world of global capital flows.”
What was needed, Brown said, was a financial system for the 21st century that recognises “the new realities — open not sheltered economies, international not national capital markets, global not local competition”.
“It must be one that captures the full benefits of global markets and capital flows, minimises the risk of disruption, maximises opportunity for all and lifts up the most vulnerable, in short, the restoration in the international economy of public purpose and high ideals.”
Brown compared the task facing world leaders now with the actions of British Prime Minister Winston Churchill and US President Franklin D. Roosevelt during World War II.
Even in the “heat of battle,” they “were already thinking about the framework that would be needed for the future,” Brown said.
The prime minister said international cooperation was the only way the global economy could achieve the re-structuring it needed to avoid a repetition of the problems seen over the past 12 months.
The current global system was “too clouded with opacity, conflicts of interest, irresponsible risk-taking, and when problems occur countries have tended to look inwards and deal with them in isolation when it is clear they should look outwards and join in international co-operation.”
Brown said he had proposed a reform of Bretton Woods in a speech at Harvard University a year ago, but other factors such as the rising oil price “got in the way” of anyone acting on his call.
He said he would now re-double his efforts to secure a meeting of world leaders as soon as possible to discuss drawing up a new Bretton Woods system.
His comments came as European governments launched a multi-pronged attack on the financial crisis, buying into banks and approving hundreds of billions of dollars in loans in a move to stabilise panic-stricken markets.
Britain announced it was ploughing 37 billion pounds into a trio of struggling banks, as part of a 500-billion-pound package of measures announced last week.
He noted that European Union (EU) leaders will discuss the crisis at a regular summit in Brussels Wednesday and Thursday.
“We are proposing a world leaders’ meeting in which we must agree the principles and policies for restructuring the financial system across the globe,” he added.
UK’s Brown: Now is the time to build global society
by admin on Mar.03, 2009, under Uncategorized
LONDON (Reuters) - The international financial crisis has given world leaders a unique opportunity to create a truly global society, Britain’s Prime Minister Gordon Brown will say in a keynote foreign policy speech on Monday.
In his annual speech at the Lord Mayor’s Banquet, Brown — who has spearheaded calls for the reform of international financial institutions — will say Britain, the United States and Europe are key to forging a new world order.
“The alliance between Britain and the U.S. — and more broadly between Europe and the U.S. — can and must provide leadership, not in order to make the rules ourselves, but to lead the global effort to build a stronger and more just international order,” an excerpt from the speech says.
Brown and other leaders meet in Washington next weekend to discuss longer term solutions for dealing with economic issues following a series of coordinated moves on interest rates and to recapitalize banks in the wake of the financial crisis.
“Uniquely in this global age, it is now in our power to come together so that 2008 is remembered not just for the failure of a financial crash that engulfed the world but for the resilience and optimism with which we faced the storm, endured it and prevailed,” Brown will say in his speech on Monday evening.
“…And if we learn from our experience of turning unity of purpose into unity of action, we can together seize this moment of change in our world to create a truly global society.”
According to a summary of the speech released by his office, Brown will set out five great challenges the world faces.
These are: terrorism and extremism and the need to reassert faith in democracy; the global economy; climate change; conflict and mechanisms for rebuilding states after conflict; and meeting goals on tackling poverty and disease.
Brown will also identify five stages for tackling the economy, starting with recapitalizing banks so they can resume lending to families and businesses, and better international co-ordination of fiscal and monetary policy.
He also wants immediate action to stop the spread of the financial crisis to middle-income countries, with a new facility for the International Monetary Fund, and agreement on a global trade deal, as well as reform of the global financial system.
“My message is that we must be: internationalist not protectionist; interventionist not neutral; progressive not reactive; and forward looking not frozen by events. We can seize the moment and in doing so build a truly global society.”
(Reporting by Jodie Ginsberg; Editing by Janet Lawrence)