"The World Bank tried very hard to make the the Turkish military appear salutary, and to avoid criticising their interventions.The official comments from the Bank, that the 1980 coup d’état would not jeopardise the Bank’s intention to lend, were very courteous". [1]
BCE / LTRO : what’s that ?
23 October 2014, byIn 2010 institutional investors (including banks) and hedge funds attacked Greece, the weak link in the European chain of debt, before turning their attention to Ireland, Portugal, Spain and Italy. In so doing, they made juicy profits by forcing these countries to increase their interest-rate on their bond issues in order to refinance their debts. Among investors, private banks made the biggest profits, by directly obtaining funds from the ECB at 1%, while at the same time making quarterly loans at 4% or 5%. As far as securities are concerned, they only agreed to buy Irish and Portuguese ten-year bonds if the interest-rate rose to 10%.
The World Bank and the Philippines
8 October 2014, byThe 1946 US decision to grant the Philippines its independence inaugurated a period of prosperity in the country. For a number of geo-strategic reasons, in the wake of the Second World War the Americans were willing to let the Philippine government pursue policies that they ruled out elsewhere.
Early Soviet Commitment to Environment Protection and its Decline
8 October 2014, byThis paper argues that while the environmentalist movements have often charged that Marxism has been productivist and has ignored the ecological concerns, the reality is more complex. The focus has actually been on Stalinist industrialisation and similar processes. It will be necessary to look at the early Soviet period, when a wide ranging attempt was made at conservationism.
United States : the Fed Bails Out Wall Street
29 September 2014, bySince 2008, the Fed has granted unlimited credit to banks at an official rate of 0.25%. In fact, as the General Accounting Office (GAO) has revealed, the Fed has lent close to $16 trillion at an interest rate below 0.25%. [2] The report shows it has not followed its own prudential rules and has not notified Congress.
World Bank and IMF support to dictatorships
29 September 2014, byAfter the Second World War, in a growing number of Third World countries, policies diverged from those of the former colonial powers. This trend encountered firm opposition from the governments of the major industrialised capitalist countries whose influence held sway with the World Bank (WB) and the IMF. WB projects have a strong political content: to curtail the development of movements challenging the domination/rule of major capitalist powers. The prohibition against taking “political” and “non-economic” considerations into account in WB operations, one of the most important provisions of its charter, is systematically circumvented. The political bias of the Bretton Woods institutions is shown by their financial support to dictatorships ruling in Chile, Brazil, Nicaragua, Congo-Kinshasa and Romania.
Domination of the United States on the World Bank
9 September 2014, byThe concept of the World as a huge bureaucracy, gradually freed from the influence of the US, is actually a far cry from reality. This mistaken conception is revealed in particular by the North American environmentalist Bruce Rich in his insightful book on the World Bank. [3] In real terms, the institution is firmly under the control of the US government which negotiates, with the governments of other major capitalist powers, the policies to be followed within the World Bank, and under its leadership. It has frequently failed to make the effort to reach a consensus with its principal partners (since the end of the 1950s, these are Japan, Germany, Great Britain and France) and it imposes its views directly on the Bank.
Private banks shamefully enjoy a monopoly of lending to the public sector
8 September 2014, byThe eurozone banks have the monopoly of lending to the public sector. It is prohibited for the ECB and the eurozone’s central banks to grant loans to public authorities (see box on the ECB). The governments in the eurozone have the possibility of borrowing from publicly owned banks where they still exist, but they do not do so.
Governments make Gifts Galore to Private Banks
8 September 2014, byGovernment aid is made up of guarantees, and injections of capital in order to recapitalize the banks. In the period from October 2008 to December 2011, €1,174 trillion (9.3% of EU GDP [4] ) worth of guarantees were underwritten by European Governments as a contingency measure. To these guarantees must be added €442 billion (3.5% of EU GDP) of public capital support to banks. During 2012 and 2013 the recapitalizations continued: about €40 billion in Spain in 2012 alone, more than €50 billion in Greece, about €20 billion in Cyprus, €4 billion more for Dexia bank in Belgium, €3.9 billion for Monte dei Paschi in Italy, €3.7 billion for the Dutch bank SNS, €4.2 billion in Portugal on top of the Portuguese bail-out of the Banco Esperito Santo in July 2014., not forgetting Ireland, Slovenia, Croatia This assistance was granted without any government supervision of the use made of the funds. [5]
Central Banks lend massively to the banking sector
8 September 2014, bySince the banking bubble burst in 2007, the major Central Banks of the most industrialised countries lend massively to private banks at very low interest rates in order to avoid their failure, thus permitting the big banks that take the most advantage to save considerable amounts in interest payments.
Footnotes
[1] Kapur, Devesh, Lewis, John P., Webb, Richard. 1997. The World Bank, Its First Half Century, Volume 1: History, Brookings Institution Press, Washington, D.C., 1275 p. This book was financed by the World Bank for its 50th anniversary.
[2] GAO, “Federal Reserve System, Opportunities Exist to Strengthen Policies and Processes for Managing Emergency Assistance”, July 2011, http://www.gao.gov/assets/330/321506.pdf. This report, was made possible by an amendment to the Dodd-Frank act that had been introduced by Ron Paul, Alan Grayson and Bernie Sanders in 2010. Bernie Sanders, an independent Senator made it public http://www.sanders.senate.gov/imo/media/doc/GAO%20Fed%20Investigation.pdf
[3] “But the only fully consistent hypothesis to reconcile the discordant elements of the Bank’s actions, performance, and stated goals was that of a bureaucracy that had become an end in itself, driven by an institutional culture of expansion and a will to power for its own sake.” in Rich, Bruce. 1994. Mortgaging the Earth, Earthscan, London, p. 103
[4] European Commission, “State aid : State aid: crisis-related aid aside, Scoreboard shows continued trend towards less and better targeted aid”, Brussels, 21 December 2012. http://europa.eu/rapid/press-release_IP-12-1444_en.htm
[5] The Belgian government acquired 10% of the shares of the biggest French bank BNP Paribas (that has been fined $9 billion by US authorities in June 2014), It so becomes the biggest shareholder but without voting rights on the board of directors and its two chosen representatives take part independently!
