Gaza versus Israel: irtenbiderantz (9)

Creating an Independent World

(https://michael-hudson.com/2023/08/creating-an-independent-world/)

By Michael Tuesday, August 15, 2023

Michael Hudson: Debt, Sponsors of the Wars, Future of USD and BRICS

AK: Hello everyone.  Welcome back to my channel. I see we are live already, perfectly on time, with a Swiss Precision today, because I have fantastic guest – Mr. Michael Hudson, who has been recommended to me by the one and only Andre Marciano who said, Ania, you have to talk to Mr. Hudson, so here he is.  I’m very grateful to welcome Mr. Hudson, who is a professor of Economics at the University of Missouri Kansas City, political consultant, commentator and journalist.  He’s also a Wall Street Financial analyst, and the president of the Institute for the Study of Long-Term Economics, as well as a prolific author of, I don’t know exactly of how many books, but at least 11; I believe is correct yes? So welcome to my channel Mr. Hudson.  Is it okay if I call you Michael?

MH: “Sure”

AK: Thank you so much for finding time to join us and I just want to say hello to everyone who will be watching us today.  If you have any questions during our live stream, and if Michael has time, I will try to ask your question. 

So, I would like to start with something that I’m very interested in.  I’m coming to understand this.  In the recent years I had no idea about any of this structure.  There is such a thing as the triangle of power as I call it.  We have the Vatican, we have the city of London, or I would rather say the crown if that makes sense, and we have Washington. Those three powers, in a way, represented the power over Spirit, over military, and power over money.  However they are all connected financially, and I would like to ask you this: how strong is this concept really? This collaboration is going on at this moment.  Who really, in your opinion, holds the most power in that triangle to influence and  sponsor those wars?  Then I will have one more question after you answer those two. 

MH: “Well, I don’t think that the Vatican has any power at all. It really has nothing to say in this.  I’m surprised it’s even mentioned.  England has no power.  The ending of World War II featured America’s attempt to absorb the British Empire into itself, and basically to prevent England from having any power.  That was the whole fight between John Maynard Keynes and the Americans in creating the international monetary fund.  Sterling was left overvalued.  The British Sterling area was broken up by saying that India and other holders of British Sterling did not have to limit their spending to London and British exports.  They could buy American exports or from anyone else.  So England is simply a satellite of the United States.  All the power is basically held by  the US state department and the CIA in conjunction with Wall Street, but not necessarily representing the economic interests of Wall Street.  I would say that the neocons are almost their own conspiratorial group called The Blob.  They’re the people, such as Victoria Nuland, who I think is still in Africa right now, and her husband Kagan, and Anthony Blinken the Secretary of State and Jake Sullivan as the National Security adviser to Biden.  So even Washington,  Biden and his group are only satellites of this neocon anti-Russian  American first idea to impose American control over the whole rest of the world.  This is driving Africa, the global South, Latin America, Eurasia, Russia, China, Iran, and the Nares and the whole rest of the world together to defend themselves from this unipolar Washington-centered group, to create an independent World along different lines from those that the United States is using as control.”

AK: Okay, so at this moment as they faced a big challenge in Ukraine.  How strong is that part in the United States in your opinion.  And where is the dollar heading and how strong is that concept that was existing, because it looks to me like it’s crumbling completely.

MH: “Well, what the United States has realized is that what used to be a military control of other countries by invading, taking over  by force can be done without the military, simply financially.  So when you say where is the dollar going you really mean, not only the foreign exchange rate of the US dollar against the Russian Ruble and the Chinese RMB and other currencies, it’s the whole system of international organizations, the International Monetary Fund, the World Bank and all of the other International organizations that the United States controls.  The dollar is not simply a dollar that you have in your pocket.  It’s the whole financial system centralized by the United States that holds veto power in any International Organization it joins. So unlike other countries, the United States is the only country that can veto any organization that it joins and makes sure that it can control them by the way in which it has legally designed these organizations.   

Which is why the alternative to the dollar isn’t simply doing your trade in Russian rubles or Chinese RMB.  It’s creating a different kind of an International Bank is an alternative to the International Monetary Fund and the World Bank in the form of a BRICS bank¹.  This is an alternative forum for international trade to the International Trade Organizations.² The United States not only says that it can veto any organization that it joins but that it doesn’t have to follow any of the rules of the organizations that other people have to follow.  The rules based order means that the United States sets all the rules and other countries have no role to play in it. 

Take the Ukraine and the International Monetary Fund.  Under the IMF’s operating rules – number one, it cannot make loans to a country involved in war.  You may have noticed there’s a war going on in Ukraine right now.  Number two it can only make loans to a country that it calculates has the ability to repay the loan.  There is no way in the world that the Ukraine can possibly pay any of the money that it’s borrowed from the IMF because it’s not going to exist as the Ukraine anymore.  The United States says ah yes Ukraine can pay because we are going to ask all of the countries of Africa, Asia, and Latin America to a break off trade completely with Russia, China, Iran and any country that does not join our pressure to make Russia pay all of the money that Ukraine owes to the IMF and to other foreign investors and all of the money that the IMF has paid into the bank accounts of Zelenski and the kleptocrats is now going to be a Russian liability.  

And if these countries trade with Russia then America will completely cut them off with sanctions.  Well this threat is basically saying we in America will commit economic suicide, if you don’t do what we’re saying.  Because if America really cuts off trade and Financial relations with all of the world except its European satellites then how on Earth can a country that is de-industrialized and has run up debt that it itself cannot pay³; how on Earth can a country that is thoroughly dependent on other countries now claim to run the whole world as if it were a parasite somehow empowered to suck all of the economic blood out of the rest of the world to somehow sustain its own prosperity.  It can’t be done.

So the world is breaking apart.  Ostensibly it’s breaking apart financially and against the dollar, but it’s really breaking apart in a sense of a whole new Financial system to juxtapose against the International Criminal Court, to the United Nations itself.  That’s what all of these discussions are now.  And you’ve seen the recent developments in Africa against other colonialism of France and it’s African colonies.  And the whole defense against the United States attempt to control all of the key raw materials and Technology of the global South is now elaborated into a fight against the legacy of European colonialism that was absorbed by the United States after World War II⁴.”

AK: So many questions I could ask you from here but I want to ask you this – in a nutshell so what is coming:  suffering to the west and prosperity to the east?

MH: “The prosperity of everywhere is going to be impaired by the fact that other countries are going to have to increase their military budgets to defend against the United States.  When a country like the United States is committing economic suicide, what it’s really saying is: Well if we’re going down we’re going to bring you down too. So you’re having the United States mount a military threat against the whole rest of the world which forces other countries to devote much of their economic overhead to military spending.  You’re seeing what happened in Russia is going to have to happen in Africa and the Asian countries.  It’s certainly happening in China.  So the United States military buildup is forcing a kind of retaliatory move abroad and there’s going to be terrorism, regional color revolutions to try to break up Russia; to try to break up China; to try to break countries into parts to create domestic kleptocracies. The United States wants to do to Asian countries to African countries and to Latin American countries what it did to Russia in the 1990s.  It wants to create a group of client oligarchs and kleptocrats who will somehow take enough control of natural resources, oil, mines, Public Utilities to then sell these resources to Wall Street buyers and to American Financial interests to control these resources financially. Obviously this is not going to be done without a fight and the fight will ultimately have to be settled on the battlefield.  

The United States is not really set up for this fight.  The amazing thing and what’s new about the United States military today is it wants to declare military war on all other countries without having its own Army; without having its own military draft; without having its own soldiers, but having other countries do the fighting. Other countries means its satellites.  You can think of Europe – England, France, Germany the whole European Community as being America’s colonies.  These are colonies that, in turn, have themselves been  colonialists in Africa and Asia.  But the United States is trying to use them as part of this sort of army to do the fighting just like at the end of the Roman Empire.  Rome hired Germanic tribes, French tribes and Gaulish tribes to do most of their fighting including fighting against Rival generals. 

America believes that it can control other countries militarily by fighting, not only to the last Ukrainian, but to let the last Polish fighter, the last German, the last Frenchman, the last Englishman as long as no Americans have to fight and they will fight with arms produced mainly by the United States. Arms which,  Andrei Martyanov pointed out, don’t really work very well in the kind of warfare that’s being fought today but arms that do create an enormous Financial profit for the investors in the military-industrial complex.  So you’re having  an American Army controlling foreign armies; the American Army controlled by generals whose objective is to rise through the ranks to a point where upon retirement they get to join the board of directors of Raytheon or Boeing or other major arm makers.  The purpose of war isn’t simply to defeat a foreign population but to use enough arms to generate a trillion dollars per year in military spending of which a large portion is profits to the financial investors in the arms making industries and their Boards of directors.”

AK: Michael, so how can this end in your opinion? Any possibility of ending this ever in the future because it looks like this is a vicious cycle that goes on and on and on….

MH: “That’s the idea. When President Biden said in February of last year 2022.  He said that this war in Ukraine is not about Ukraine.  This is the beginning of a two-decade war, maybe three decades. He said, this war will go on not only until we defeat Russia, but once we destroy Russia we can then go against our number one enemy China.  It’ll take 20 or 30 years for us to uh destroy China and it’s going to take all of our allies an enormous fight of their own Army and their own citizens dying and their own economic resources to support the U.S encirclement and sanctions and its attempt to isolate the Chinese Community along with the entire Shanghai Cooperation Organization: Russia, Iran, Saudi Arabia, the whole rest of the world is to be isolated somehow by the United States without its own Army and without being a creditor anymore and without having its own industrial base.  Nobody would have believed a science fiction story that would have said that an economy with all of the liabilities and negative features that the United States had could be any kind of a power at all except being like England after World War II which is the position America is in economically.  But what makes America different from England and World War II is America doesn’t have a higher power that’s fighting against it.  America is Its Own Worst Enemy fighting against itself instead of other countries fighting against this, so uh you’re having the dynamic of this International conflict that’s dividing the world into two – on the one hand the United States and Europe on the golden billion, “the Garden”, and on the other hand the rest of the two-thirds of the world’s population, the global majority, which America calls “The Jungle” which is to be cut down and clear-cut and privatized for the benefit of “the Garden”.”

AK: Thank you.  In one of your interviews you said that you have spoken if I remember correctly, three times in front of the Russian Duma. You had spoken in the Russian Duma and, you know, I’ve been to Russia a few times recently.  I love Russia.  I grew up being brainwashed to hate Russians. I’m polish originally and when you were there you were addressing the topic of what was the plan of the West towards Russia.  Now this was some time ago.

MH: “No, I was discussing how Russia could deal with the kleptocracy that the Americans had put in place and my message on all three occasions was that even when you have kleptocrats taking control of Russian oil, Russian mineral rights and other natural resources, you can recapture it.  You can get this back for the Russian government and for the public domain by means of a land tax.  I was urging Russia not to adopt the single tax system that was being forced on Russia by the neoliberals.  I was urging it to prevent housing prices from exploding by taxing the lands rising rental values.  If you do not tax the land’s rental value Russian families are going to have to be forced into debt to the banks to borrow the money to buy their own apartments and all of the money that used to be paid to the Russian state or was paid in the west to landlords will be paid to the Russian banks that the kleptocrats have taken over .So I wanted Russia number one to treat the money and credit system as a public utility as China does.  I wanted Russia to keep the money creation and the credit in its own hands.  

Number two not to tax its labor or to tax its industry but to recapture what the kleptocrats had taken by a rent tax. If they’ve taken the oil resources then  you tax away the whole free lunch that they’ve got from the oil and it doesn’t matter whether they’re the owners as long as all the income from it ends up being paid once again to the government by taxing instead of by direct ownership as before.  Same thing with the electric utilities that chubias and others  took over.  You can tax the economic rent that chubias and the kleptocrats received over and above the money that they actually put in the new investment .  That’s the only way Russia could have actually funded new construction and begin to build housing for its population, which was the one great lack that Russia had ever since  Soviet times when families were all crowded together.  The only way that Russia could Finance its own industry and its own development.  In practice has been done on an informal level by insisting that the kleptocrats act as if they their oil revenues and their mineral revenues are used for public projects.  

But I wanted to make it formalized and this in fact was precisely what the great fight in Europe was for socialism in the 19th century; for free markets – the fight of Adam Smith and John Stuart Mill and Marx himself was that you have to get rid of feudalism.  The United States wanted to re-introduce feudalism to Russia. It wanted a client oligarchy, it wanted to put in Russia what it had put in Chile under the kleptocrats under Pinochet.  It wanted to create new landlords, a new financial class but instead of really a landlord class that wanted to create a banking class as the new feudal Lords controlling Russia.  I was trying to help Russia avoid that plan and I brought over the former Attorney General of the United States Ramsey Clark ,I brought over a whole group of people to address the dirt in the Duma.  Needless to say we didn’t have a chance because we didn’t have the billions of dollars of bribery that the United States was able to use to bribe the most corrupt Russians that it could find to put in power as its client oligarchy.”

AK: Thank you so much. Now, when you look at Russia, how do you see it? How do you see their financial approach to this entire situation?  Do you think they took the right road?  What would you do if you were in in their position right now?  Do you think they are doing the right thing as they are going forward?

MH:  “Everything Russia is doing is on an ad hoc basis that they’re sort of making up as they go along.  They’re not making a formal economic and tax system.  The financial system has to be part of the tax system itself and the monetary system. And the banks are still largely private.  They’re operating as a kind of do-it-yourself, make it up as you go on purely pragmatic grounds that are dictated by the war.  So they’re doing what is necessary but they have not yet created a system for what is going to happen after Putin finally leaves.  What is going to be the long-term in Russia.  You have to have some kind of an economic structure and the structure has not been put in place yet.  It remains informal and therefore opaque because I haven’t been in Russia since I was brought over by the former prime minister Medvedev, quite a few years ago.”

AK: Fascinating life you have, Michael ,fascinating truly…Now BRICS, let’s talk about BRICS. Soon there will be a summit in South Africa on 22nd of August. Now will there be just one currency that they will be operating with or different currencies and would it be backed by gold?⁵ What does this really mean for the future of any other currencies like euro, dollar, any other currency,  even polish Zloty, because there are many countries who still keep their own currency in Europe?

MH: “Right , the only choice right now and for the immediate future is to do trade in their own currencies⁶ – they can do currency swaps as you’re saying.

(…)

Goikoa da aspaldian ezagutzen nuen Michael Hudson-pentsaera, hemen birmoldatua eta egokitua 2023ko urteko egoerei.

Pentsaera aspaldikoa da. Izan ere, ondokoa lan honetan (Nazioarteko ekonomia eta ‘Inperialismoa’) funtsean gauza bertsua ikus daiteke.

Hortaz, azken lantxo horrekin, ‘bakean’ utzi nituen Michael Hudson eta bere irakaspenak, harik eta berriki Palestina dela, Gaza dela eta Israel-en triskantzak analizatzeko, berriz, bera topa dudan arte, geopolitikako espazioa garrantzitsu horretan.

Baina ekonomian, 2023ko goiko lan honetan ikusi dugun moduan, ez du ezer aldatu: ekonomiazko zentzu hertsian, Hudson-ek ez du aldatu

(…)

AK: So, last question here is this: as every Empire has fallen in history,  would you say that the United States will also be that Empire that has fallen and what will emerge in the world after that?  Will we have this collaboration multi-polar world, people trading, different countries strengthening their own sovereign uniqueness ,strengths? Or this will be still the fight? How do you see that future Michael, because you know so much about the history, you know the cycles, what cycle are we in right now ? Where this is heading ?

MH: “Well I’ve just published a book on the collapse of antiquity – why Greece and Rome collapsed.  The Roman Empire collapsed because of the grade of its oligarchy.  The financial oligarchy.  It collapsed because the wealthy oligarchs drove the whole economy into debt; they expropriated the landowners; organized the whole land into huge landed Estates and reduced the population to serfdom.  Ultimately the  greed of the financial class, according to the Roman historians that spelled it all out, they said they were so greedy, the wealthy Senate leadership, that they bankrupted the whole economy and rather than saving the whole economy they wanted to keep just enslaving and enserfing other people.  Almost all empires have destroyed themselves from within.  So the Roman historians know say Rome is collapsing, not because of the Barbarian invasions.  Our banking class; our financial leadership.  We’re The Barbarians.  Romans were defecting to the Germans, defecting to the Gauls , defecting to the tribal societies outside of the Roman Garden because they were more equitable. They were fairer.  There was a flight from Rome; the population was basically collapsing and the so the Roman army invited in foreign fighters and the foreign fighters ended up just saying well you know we’re going to just take over the economy and the part of Rome that survived was in Constantinople and that’s basically where Christianity survived. Christianity ended in the West in the fourth Century with a Cyril of Alexandria and Saint Augustine that completely got rid of the Lord’s Prayer as it was in the Bible “forgive us our debts” and said no “it’s forgive us our sins”, the sins are sexual sins and egotism for Adam and you get rid of the sins by paying money to the church and we will give you a passport to Heaven – an Indulgence if you pay us. So it’s for the Catholic church and the Christian church a sin was the failure to pay money to the church for them to enrich themselves and what had been the actual Roman Christianity and real Christianity survived in Constantinople in the Eastern Orthodox Church that was then conquered in the Crusades. So, a long story there; so Rome killed itself from within.  

And you could say today the United States, by fighting the war, by putting the sanctions on Russia, by destroying the north stream pipeline to Germany, and by America saying we’re going to make sure that if we’re losing our power to control China and Russia and Iran at least we can control our European colonies.  We want to make sure that Europe does not go it.  We want to prevent Europe from acting in its own self-interest and moving into the China Russia Eurasian orbit so we’re going to cut off all the gas supply and oil supply and fertilizer supply to Germany.  We’re going to bankrupt German industry. BASF the German chemical company has already announced a few months ago it’s not going to invest any more money in Germany it’s going to have to move out of Germany. Germany is going to look like Latvia and the Baltics – its population a skilled population, if it wants employment is going to have to move either to the United States or to Russia and China or elsewhere  outside of Europe. So you’re having Europe being essentially broke now, just as it was broke by World War I and broke again by World War II and you’re finally seeing the end of Europe is an active force in the world stage.  That’s been destroyed by the European colonialism and is being destroyed by the U.S and we’re seeing it finally being snuffed out in the French colonies of central Africa now. and the United States is destroying Itself by imposing sanctions on trade with all the rest of the world.  The result is it’s imposing sanctions on itself.  It’s stifling the U.S economy that does not produce its own raw materials or its own metals and does not produce its own prosperity and is completely dependent on other countries and is now separating from them so that the rest of the world no longer has to support the United States and Europe. Now that they have destroyed their own economies there’s no way that the rest of the world can afford to pay its dollarized debts and follow international trade and investment rules that favor the United States Financial system that controls U.S trade and investment.  The rest of the world can free itself from this economic anchor that is holding its development back and in a way that’s a positive result of the Ukraine War.  The Ukraine Wars have given the United States the leeway to hang itself. “

AK: Incredible… Would you be so kind and answered two of my very quick questions because they were just born from what you were saying.  Do you think European Union will survive much longer? Or it’s on the brink of collapsing? How will this go with the  Euro currency as well for that matter?

MH: “If you believe that countries ultimately are going to act in their economic self-interest then Europe will break up.  The Eurozone will break up – it was a disaster from the beginning. The rules written into the Eurozone make it financially dependent on the United States.  You have the United States reacting to a depression by running a budget deficit to pump money into the economy.  The European constitutions prevent any national government from running a budget deficit of more than three percent of its GDP.  This is not enough leeway to pull Germany, Italy, France and other countries out of the depression that the U.S war in Ukraine (which is really the U.S China War) has been causing them. So Europe’s choice is either to remain a U.S satellite, a U.S Colony, or to try to go its own way but it can’t go its own way because it’s already been de-industrialized.  German industry cannot be revived without oil and gas from Russia and the United States says no.  The European politicians have been manipulated by the United States.   European politics since World War II has been manipulated by the United States especially taking over their labor parties and their Social Democratic parties to be traitors to Europe.  The European politicians represent  American national interests not the national interests of their own countries so the whole European political system the whole EU mechanism has become a means of imposing United States neoliberal policies on  Europe and that whole system has to go.  But since Europe has let itself be manipulated and  twisted by American political interference the only way is to turn Eastward to turn toward Russia China the near East and to turn its back on the United States.  So probably England will stay – they would rather be impoverished and starved to death than give up their fantasy of somehow being the little brother of the United States, but the rest of Europe, the non-English speaking Europe, certainly has an option of going its own way.  It probably won’t until there’s very substantial emigration of labor, flight capital and a relocation of European industry in Eurasia away from Europe.   leaving Europe basically as a kind of Disneyland – a theme park.  Tourists will want to go to Europe and they’ll see Germans in their old Lederhausen and quaint costumes doing medieval dances and Europe will be sort of an entertainment zone for Eurasia but not an industrial or a financial power.”

AK: Very heartbreaking but I agree with what you said.  My last question is about China.  When I look at the map and I see Asia and I see Europe one would think to create the Silk Road we don’t have to do that much really.  We have the land we can build this road, we don’t have to cross the oceans we don’t have to go around the planet we have the land – you just build it. They are making constructions in China that people never imagined are possible but yet they exist, planes are landing on the top of the mountain ,yes it’s possible. So Michael, tell me, do you think we will be able to see this Silk Road in the future that will actually connect Europe with Asia with China and there will be the sense of collaboration and trading, the healthy way of doing it?  Or do you think it’s not realistic?

MH: ” Well China and the rest of Asia do not need Europe.  If you read the speeches of President Putin and Sergei Lavrov you can see a feeling of disgust including disgust with themselves – how could we have ever believed that we could turn toward Europe; how could we ever have thought that somehow we could turn to them for leadership.  Look at them – they’ve fallen apart; they’ve turned out to be just puppets of the United States in the same way in which America tried to make Russia a puppet under President Yeltsin. I think of Europe as being run by a whole set of local president Yeltsin’s in charge of Germany, France, Italy, and the other economies, so Asia does not need Europe. Europe has a choice, either it can try to rejoin Asia with the Eurasian land mass or it can simply depopulate and empty out  So far the choice of European voters is that we want to empty out.  We want to die.  That’s what we’re voting for; that’s our Democratic rights.  We’re voting to die like Ukraine.  We’re voting to pay all of our taxes to give to fight for America’s war against China and we’re willing to be impoverished for America that’s our choice.  We realize that our life expectancy is going to go down; we realize that we’re going to be out of work; we realize that suicide is going to go up; we realize that our women are not having children anymore but it’s worth it because we have a dream of America and we’re going to live in this dream that’s our dream and we have a right to commit suicide. 

So right now to me it looks like Europe is  committing suicide for the foreseeable future.  If you want to see what it’ll be like look at Latvia and Estonia since 1990. Look at how they’ve lost 25 percent of their population.  They’ve all had to leave.  Think of in Poland and how the Polish people were leaving for what the English called polish plumbers.  Think of all of the movement of Labor out of the Central Europe.    Well now the question is, are you going to have a similar movement of Labor out of Western Europe? Well you’re certainly having an exodus of labor’s employers of European heavy industry outside of Western Europe.  If the Employers in heavy industry are going, won’t  the skilled labor follow them? Will they follow them to Russia to China to Central Asia to India?  Who knows where they’re going to go – but there’s really no future for them in Europe as long as Europe remains an American colony and lets this policy be dictated by the United States through its economic arms of the IMF, the World Bank, the international criminal court and the various United Nations agencies that are controlled by the United States.   Europe has a choice.  Is it going to join the growing part of the  World economy – the global majority – or is it going to stick with the garden, the golden billion, the shrinking minority.”

AK: Yeah I think we will end our life here I am immensely I truly mean it from my heart, immensely grateful for all your knowledge and your time today that you gave me in my audience. What is the best way to support your work besides of course getting your books because all the links are already, there what’s the best way to support your work Michael ?

MH: “Well you can go to my website michael-hudson.com and you can join my Patreon group and have discussions with me on that.    So my website, my Patreon group through michael-hudson.com helps.  Reading my books will give you the logic behind all of my ideas which I’ve tried to explain in very great detail how the system works and reading them then, you can become part of the fight to help save your part of the world.”

AK: Thank you, thank you so much for coming on today and I hope in the future I will have a chance to connect with you again on my channel.

MH: ” Well I look forward to reading the transcript.”

AK: Thank you thank you so much everyone for watching and I will say goodbye here.  Leave the comments down below and all the links to Mr. Michael Hudson you already have in the description box.  Bye everyone and thank you

Image by Leonhard Niederwimmer from Pixabay

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