Category: economy

Posted on

“An Unprecedented Era of a New Tyranny” – Noam Chomsky Responds to Poet John Berger

By Bryan Thomson

On Tuesday, April 22nd, the Gender Research Institute of Dartmouth hosted Booker Prize-winning English poet John Berger and Noam Chomsky, an MIT professor and acclaimed intellectual as part of the ‘Times of Crisis’ lecture series.  Berger first submitted to Dartmouth an enigmatic and poetic recording on the limiting nature of capitalism in modern society, and Chomsky then reflected on what Berger stated.

In his reflection, Berger described what he considers a new type of global tyranny.  In a similar vein as the now-infamous arguments made by Karl Marx in his Communist Manifesto and later echoed by Jalal Al-I Ahmad in his 20th century work Occidentosis, Berger sees a distinct divide between an impoverished, exporting East and a greedy, exploitational West. This dichotomous divide between classes and societies creates what Berger labels a worldwide capitalist prison, wherein the walls no longer keep prisoners from escaping, but rather stop the world’s poor from entering the protected lands of the rich. The conspiring powers, no longer governmental, but instead transnational and economic, attempt to dissuade rebellion through empty talk of human rights, growth and democracy, while in reality they desire complacency through passive uncertainty.

Though the capitalist prison presents a massive threat to sustainability and egalitarian living, Berger argues the era is no more unprecedented than any others, since every significant change is ‘unprecedented.’ He ultimately claims that, in order to break the passive acceptance of today’s tyrannical economic oppression, the world’s ‘prisoners’ must find liberty locally, “in the depths of the prison,” and thus break free of the current sedative state of being.

The lauded intellectual, linguist, logician, questionably labeled ‘anarcho-syndicalist libertarian,’ and MIT professor Noam Chomsky skyped in to reflect on Berger’s speech. In his response, Chomsky delved into the various threats to humanity that he argues, do, in fact, make this era unprecedented. Professor Chomsky summarized the state of the global capitalist structure as having, unnoticed and unquestioned, but massive, systemic failures.  The protectionist and universally harmful nature of NAFTA, Alan Greenspan’s claims that worker insecurity is beneficial for the economy and the often exorbitant returns to investors have been the forces driving the world toward collapse.  The systematic NSA surveillance is demonstrative of a government desperate to use security as a means of retaining control, not actually bettering its citizens’ lives. Even environmentally, the elites have only desired quick profits and ignored long-term concerns. Not since the Cretaceous mass extinction event have species been dying so quickly. Global issues of nuclear threat, global climate change and impulsive increases in executive power over democratic debate exacerbate the challenges of the classist struggle the world is undergoing, Chomsky contends.

The proliferation of communication technologies that have saturated virtually every rung of every society in the world now make local issues international. Berger believes our salvation can come through cyberspace – as information is empowering and allows those alive now to “stand shoulder to shoulder with the [wronged] dead.” At the end of his response, Professor Chomsky raised a call for action on the part of student groups and grassroots movements to take on the existing power structure that has allowed so many issues to arise.  Much like the Civil Rights movement in the 1960s or British Suffrage movement, modern challenges demand local and organized action.  Taken in Berger’s global, trans-generational context, Chomsky’s call for action becomes one that demands historical awareness and effective global communication.

Both Berger and Chomsky made clear their opinions that we are truly living in a time of crisis, and that such a time demands effective action.  Whether or not the reader believes in the fundamental evils and reach of a corrupt, transnational Capitalist prison, Chomsky and Berger together create a convincing argument for awareness of global affairs and current issues.  In the 21st century’s age of information, dissemination of opinions, organization of opposition and collective action on socioeconomic and multi-national issues are more feasible than ever before.

Posted on

New directions in German politics

By Kristy Choi

On October 15th, former US Ambassador to Germany Philip Murphy came to speak at Dartmouth as part of the Walter Picard lecture series. During his lecture he discussed the results of the recent German national elections and the importance of the political and economic ties between the U.S. and Germany. He spoke fondly of his time working with Director of the Dickey Center, Daniel Benjamin, in the State Department and about his conversations with faculty of the German Department at Dartmouth the previous night.  He joked about feeling like he had just left the witness protection program because he felt out of touch with America after having been in Germany for so long.  He strongly urged students to travel and spoke highly of the foreign service as a career.

During the lecture which was entitled, “The New Shape of Germany,” Ambassador Murphy spoke about how in the 80s, “Berlin loomed large.”  He spoke about two myths that have permeated since the fall of the Berlin wall:

1. Because the wall is no longer there, the world is safe and uncomplicated.

2. America is not as close to Germany as it used to be.

In addressing these issues, he emphasized two key areas of interest:  the security sector and economic sector.   The security arc for Germany played out mostly as expected in that Germany eventually rebuilt its military power and later helped lead in the NATO mission to Kosovo and the invasion of Afghanistan.  However, the economic arc was not as predicted.  Germany “stumbled, it reformed, and then it soared.”   Much to the world’s surprise, Germany outpaced its European peers to become the central hub of European economic activity.

This new geo-strategic shape has made Germany instrumental in the global economic crisis and crucial as an ally of the United States. Ambassador Murphy felt strongly that Germany would continue to back the Euro, but not at any price. Germans would be willing to act, but only if they feel like everyone was playing by the same rules.  He felt this not only reflected the Greek bailout, but the approach they have taken to every decision in the wake of the global recession.  However, Ambassador Murphy also recognized that they are already deeply entrenched in the bailout process, likening it to being halfway across a river, “there’s no going back.”

Ambassador Murphy noted that the world was rife with challenges.  They may not have been the same challenges envisioned thirty years ago, but nevertheless they exist.   While the risks associated with these challenges are substantial and it may take longer than hoped to meet them, Ambassador Murphy is ultimately optimistic about the future and he is adamant in his convictions.

Posted on

What’s all this about a euro crisis?

By Kristy Choi
Courtesy Sean Gallup (Getty Images)

Every few days, there seems to be a new headline in the news about how “the Eurozone is in crisis!” Yes, since 2008 Europe has been having financial problems like the rest of the developed world. Ok. But why are they the crisis spot when tons of other places are having a rough time of it too? Big newspapers aren’t saying the same thing about the US anymore, so why focus on Europe?

Fear not dear reader. I shall be sloughing it through those Economist articles so you don’t have to. When the Federal Reserve thinks the US economy is in trouble, they generally flood the markets with a little extra cash (it’s more complicated than this, but this simplification will suffice). Why doesn’t Europe do this? Well, because the Eurozone is a system of several countries adopting the same currency — this lowers transaction and trade costs. While the economies were still doing well, everyone was convinced the system was working. However, after the crisis it became clear that the central monetary authority, the European Central Bank (ECB), was largely handicapped because individual countries still had to vote to approve measures. Greece, for example, is in huge trouble. Germany, on the other hand, is doing just fine. Central bank policies must be the same throughout. As a voting party in a loose union, (never mind the main source of funds) Germany can object — and object it does.

However, the problem became so severe and the Greeks so deeply in debt that even their government bonds were rated as ‘junk’ because nobody believed they could be repaid. Investors were essentially worried that Greece was going to collapse because Germany (and to a lesser extent France) were not willing to do what was necessary to save them, only barely creating bail outs — and never without a large number of strings attached.  This was not unfounded thinking — after all, why should they fund the poor decision-making of their peers?  They were the hard-workers and Greece the prodigal son, returned home from partying a little too hard.  However, their lack of action led to fears that the entire system of the euro was under threat — Greece’s woes were pulling the whole system down.

Over the summer, there were increasing calls for a “Grexit” or an exit of Greece from the euro. Greece could then devalue their currency to stave off collapse, and the rest of the EU could become more stable. However, even if Greece was the most toxic, there were fears about other economies as well. If Greece exited, what about Ireland, Portugal, Italy, and Spain? They too were all in deep straits. And Spain is the EU’s fourth-largest economy. If all these countries were forced to leave, many feared it would be a downward spiral the EU would not recover from. And the collapse of the euro?  According to the former head of the World Bank, that “runs the risk of sparking a Lehman-style global crisis that will have dire consequences.”


That changed a couple months ago.  Mario Draghi, head of the ECB, finally vowed “to do ‘whatever it takes’ to preserve the euro.” This helped bolster investor confidence. But was it going to be enough? The ECB and the important parties have dragged their feet at every turn.  Even now, there are quarrels from within. Notably, the head of the German Bundesbank, the only person to vote against Draghi’s plan, claimed that with this plan the “monetary system [could be] destroyed by rapid currency depreciation.” He was also quick to cite inflationary worries in a system he believed was tantamount to simply printing money. What would be so bad about depreciation? Certainly it would make European exports more competitive and bolster economies, including Germany’s. However, that massive depreciation would come at the heavy cost of imports becoming excessively expensive. Consumer lifestyle suffers; each European will find the same income will now buy them less. For a country like Greece, that is an acceptable price to pay in the face of state bankruptcy; for a country like Germany, that seems like a cost they would rather not bear. Yet Draghi’s plan to utilize the ECB’s printing press is going into action anyway. Greece lives to fight another day. For the moment, the markets rest easy.  European leaders at last seem committed to keeping the euro alive. This is all good news for the euro. But it is still only the start for a system seriously under siege.

Sources
http://www.nytimes.com/2010/04/28/business/global/28drachma.html
http://www.economist.com/blogs/charlemagne/2012/06/germany-and-future-euro-1
http://www.guardian.co.uk/business/2012/jun/16/world-bank-euro-collapse-crisis
http://www.nytimes.com/2012/10/05/business/global/european-central-bank-leaves-interest-rates-unchanged.html?pagewanted=2
http://www.ft.com/cms/s/0/558d7996-01af-11e2-8aaa-00144feabdc0.html#axzz28SkudCsX
http://online.wsj.com/article/SB10000872396390443507204578020323544183926.html

Posted on

The Senkaku/Diaoyu Island Dispute: Part Three

By Nicole Boyd

Political Analysis

What are the political motivations underlying the dispute?


In China, Anti-Japanese protests over the island dispute are concerning to political leaders because a lack of diplomatic response on the Chinese Communist Party’s part could cause discontent to turn to domestic issues, which is a circumstance Beijing has been extremely careful to avoid. As a result, Chinese leadership must appear strong in the face of Japan’s activity regarding the islands. This has manifested itself in a call to boycott Japanese goods and the sudden presence of state fishing vessels in the disputed waters. Despite thinly veiled threats of economic and military retaliation, however, Beijing is highly aware of the cost such ventures could pose.


Japan and China are highly economically co-dependent; trade between the two countries is at an all-time high, amounting to nearly $350 billion in 2011. On top of this, Japan accounts for roughly 11 percent of foreign direct investment (FDI) in China, making it the nation’s third largest source of outside investment after the U.S. and Hong Kong. Pursuit of more aggressive economic means of fighting Japan on this issue would have an undesirable effect on both economies and serve as a negative shock to the world economy, possibly impeding global recovery. A full-out military war with Japan would be extremely costly financially, not to mention the inevitable toll on China’s growth rate. The issue is further complicated by U.S.-Japan security agreements. U.S.-Chinese relations are frequently strained, but the fact is that both states are highly interdependent on one another economically, and the fall out of a war between the nations regarding lost financial and human resources would be enormous.


Such outcomes are undesirable for China. The nation’s leaders are highly dedicated to regional security as a means of promoting economic growth. It is unlikely that diplomatic actions in this dispute would go so far as to jeopardize this overarching agenda. It should be noted that before the latest excursions following Japan’s announcement that it had purchased the islands, Chinese vessels had not ventured into the disputed waters since August of last year. The Chinese government initially encouraged anti-Japanese sentiments as a means of distracting the public from internal issues, but now it is clear that Beijing feels threatened by the widespread protests and is making an effort to restrain them.20


Japan’s leaders are also facing internal pressure. Since the 2010 incident, domestic criticism of Japan’s weakness in diplomatic dealings with China has escalated. Governor Ishihara, author of the controversial book “The Japan That Can Say No,” is a prominent figure speaking for the rightist nationalist segment of the population that wants Japan to take a more aggressive stance in foreign policy. After Ishihara’s public steps toward buying the islands, the government stepped in not only to appease the nationalism the events stirred up but also as a measure of restraint against Ishihara.


Tokyo leadership has other things to consider as well; elections must be held before the summer and polls indicate a shift in power from the currently ruling Democratic Party to Japan’s Liberal Democratic Party. Naturally this is a period of time when democratic leaders are most sensitive to shifts in public opinion, increasing the effect of domestic criticism on policy decisions. Japan also stands to lose from a prolonged confrontation with China, however pressure from the right is impeding Tokyo’s ability to cooperate by demanding a strong uncompromising image. The way Tokyo has chosen to project that image is not only to engage in verbal battle with Beijing, but also to call upon Japanese-American security relations as another means of threat against would be “invaders.” 

Taiwan’s involvement in the dispute is less intense than it’s larger counterparts. Like China, it also saw fit to make a statement by sending vessels into the disputed waters. However, at the risk of complicating its own sovereign relations with Beijing, Taipei is careful of being too vocal on the issue. 


Taiwan is a major trading partner with both Japan and China and a security partner with the U.S. At the moment, other than its brief show of defiance it appears that Taipei has decided not to complicate it’s relations with the U.S. and Beijing and remains on friendly terms with Japan.


Implications for U.S. Foreign Policy


What does this mean for the future?


Despite speculations in the Wall Street Journal on the outcome of a Sino-Japanese naval war, full-scale warfare seems highly unlikely. Tensions may continue to rise, however, if the governments in question fail to calm elements of nationalism within their respective countries. This will likely manifest itself in the form of increased skirmishes between the Japanese coast guard and Chinese (and to a lesser extent Taiwanese) vessels entering the disputed waters. China might seek to withhold certain imports to Japan as it did with rare earths in the 2010 incident. If such measures are taken, however, Tokyo will feel considerable pressure to fight back economically; the government has already threatened to halt investment in China. This could set off a chain of such attacks that would have the potential to rapidly escalate.


Despite China’s criticisms of “American hypocrisy” regarding its simultaneous claims of neutrality and support of Japan in military defense of the islands under the US-Japan Treat of 1960, to renege on that agreement would have disastrous effects not only on relations with Japan but in the larger scheme of American security interests in the Pacific. With China’s increasing military capabilities, U.S. allies in the region have to consider the ramifications of a potential conflict between the two powers and the possibility that the U.S. is no longer capable of providing the protection that it could in the past. If the U.S. appears to be unwilling to follow through on its security agreements it will send a message to other Pacific allies that with China’s rise a U.S. security agreement no longer guarantees assistance, which will likely spell the end of U.S. dominance in the Pacific.


On the other hand, the U.S. should discourage its allies from deliberately provoking China because they are confident in U.S. support. Not only does this undermine regional stability, but it puts the U.S. in a difficult position diplomatically and undermines reassurances that the U.S. is not trying to contain China. Therefore restraint should be encouraged not only on the Chinese side, but on the side of our allies as well.


The U.S.’s role should continue to be one of neutrality, with no acknowledgement of either sides’ sovereignty over the islands. The situation is a complicated issue historically, legally, and emotionally – to become further entangled in the dispute is to risk relations with all parties. Leaders should continue to encourage calm diplomacy, a point U.S. Defense Secretary Leon Panetta stressed in his visit to Beijing on the 18th. All parties stand to lose from prolonged conflict; most of the governments’ aggressive actions have been designed to alleviate internal pressures. With the importance of saving face so prominent in this dispute, Track I diplomacy will likely be hampered by politicians’ attempts to avoid inflaming public discontent by appearing too conciliatory. Therefore, this represents a good situation in which to consider employing Track II dialogues as well in order to promote cooperation between parties and talks that go beyond the party line. A method of doing this would be to encourage confidence-building measures such as joint fishing and or drilling rights in the disputed waters to try to ease tensions between the nations. 



Sources
http://www.washingtonpost.com/world/chinese-government-both-encourages-and-reins-in-anti-japan-protests-analysts-say/2012/09/17/53144ff0-00d8-11e2-b260-32f4a8db9b7e_story.html  http://www.ft.com/intl/cms/s/0/aa82cf7a-6f68-11e1-b368-00144feab49a.html#axzz27guHsxfp
http://www.cnn.com/2012/09/20/opinion/china-japan-dispute-kingston/index.html
http://www.huffingtonpost.com/huff-wires/20120914/as-japan-politics/