Tuesday, May 11, 2010

Serviced with a smile


Investors ... are not in a generous mood. Portugal's economy has grown less than 1 percent a year on average for the last decade. Its main advantage, cheap labor, gradually disappeared when it joined the pricey euro zone and wages kept rising. "We have seen a lot of multinational activity move away, and we have not been able to compensate," says Miguel Athayde Marques, chairman of Euronext Lisbon, the country's bourse.
Before adopting the euro, Portugal could devalue its currency to boost competitiveness. That option no longer exists. Instead, it has to restructure its debt, says Stuart Thomson, who helps oversee $100 billion at Ignis Asset Management in Glasgow. Debt restructuring, explains Thomson, "is the new currency devaluation in the euro zone."

Debt restructuring is the new currency devaluation in the euro zone! As the Greek example has shown, this doesn't mean rescheduling the debt or reducing the principal on the debt, or in any other way making the debt more manageable: it means servicing the debt in ways that business likes, by pushing developed nations into a "developing" model of rapid growth through popular impoverishment.

Any population with no alternative but to "just feel lucky they have a job" is a pliable, obedient one; as Americans, we already feel the impact of this model as it is applied here at home. With a variety of options available for unwinding the fallout of a Wall Street-inspired housing bubble, it has somehow become the obligation of ordinary Americans to sacrifice their libraries and school systems, among other pillars of the "commonwealth," to buy back the assets investors no longer desire!

The US may still be in a position to devalue its currency, but that doesn't make debt restructuring -- in this case, transferring debt from investors to communities -- any less the order of the day, least of all when the orders are coming from Wall Street.


Jack Crow said...

...while the "creatives" make more money and lose social restraints on bragging about it:


Also - see the push towards charter schools in this light, as the pillaging of the educational commons and the transformation of education into a tiered commodity, produced educationalworkers and consumed in levels equivalent to class.

Jack Crow said...

wrong link above. here's the correct one:


explains the comment about charter schools, too, I hope - since the link contains the original reference...

JRB said...

This brings to mind how the term "entitlements" is suggestive of commodities that have been mistaken for "rights."