Quite Marvellous

So, this rather puts Naomi Klein\’s thesis to the sword, doesn\’t it?

The fulminating text is the clearest evidence yet of the mounting drive for an EU-wide "super regulator", which would reduce Britain\’s Financial Services Authority to a regional branch – and pose a grave threat to the City of London.

European critics of Anglo-Saxon "casino" capitalism have seized on the credit debacle as a chance to clip the wings of the City and to extend EU jurisdiction deeper into financial affairs – a jealously-guarded domain of EU member states. They know that Britain is unusually vulnerable to pressure after the Northern Rock affair, which exposed grievous shortcomings in the UK regulatory structure.

She of course said that "neo-liberalism" used crises to extend its reach. Whereas of course the opposite, as shown here, is the truth, that each crisis, whether imagined or not, is used as a pretext for extending the power of The State and the politicians who direct it.

But perhaps the more important point is that the socialist luminaries who are proposing this "super regulator" don\’t understand markets at all. OK; perhaps they will get sufficient power to create such a regulatory body. Perhaps they will get rid of the vicious Anglo-Saxon style financial markets from the EU. But they won\’t get rid of said markets. They\’ll simply move.

As, indeed, they did from New York when controls were imposed there in the 50s and 60s.

9 comments on “Quite Marvellous

  1. “As, indeed, they did from New York when cxontrols were imposed there in the 50s and 60s.”

    Not forgetting the work of Senator Sarbanes and Representative Oxley. They should be given the freedom of the City of London for their services to the UK finance industry.

  2. a) it would be both bad and ridiculous were this to happen
    b) this will never happen
    c) Evans-Pritchard has an enviable 20-year record as a scaremongering loony…

  3. “c) Evans-Pritchard has an enviable 20-year record as a scaremongering loony…”

    A stopped watch is still right twice a day..

  4. I wonder what dear little Ms Klein has to say about Burma – where the Socialist Junta is using a disaster to cement themselves in power. Or China for that matter where the Government is manipulating the media wonderfully.

    (Or, at the risk of breaking Godwin’s Law, how she explains the rise of the Nazism (which mustn’t have used the Great Depression to get into power and destroy Liberal Weimar) or the victory of the Soviet Communist Party (which couldn’t have used WW1 to destroy the Liberal government of Kerensky))

  5. I’m guessing SMFS and JP haven’t read Klein.

    Her point is that *in situations where laisser-faire western capitalism is already a major ideological force* this happens – specifically, in the US, and in the international bail-out institutions dominated by US-trained economists.

    The thesis holds when looking at the US, most EU countries, and those developing countries that found themselves dependent on international institutions between the late 1970s and the time of her book. It isn’t invalidated by Burma, the Nazis or the Russian Revolution.

    It is, potentially, invalidated if the response to the current economic crisis in the US and EU is greater protectionism, socialism and regulation. Which is why this is interesting.

  6. john b – “I’m guessing SMFS and JP haven’t read Klein. ”

    I admit freely to not having read her book. A few articles was pain enough.

    john b – “Her point is that *in situations where laisser-faire western capitalism is already a major ideological force* this happens … It isn’t invalidated by Burma, the Nazis or the Russian Revolution. ”

    I am sorry but how can you say that Western Capitalism wasn’t a major ideological force in Weimar Germany or Kerensky’s Russia?

  7. In Kerensky’s Russia, it unequivocally wasn’t – Tsarist Russia was an authoritarian feudal state, not a capitalist one.

    Weimar was closer to modern capitalism than Russia, admittedly; but there’s still a big difference between the pre-Keynesian economic stuff-just-happening of the 1920s and the policies directly influenced by neoliberal economic theory of the 1980s.

  8. john b – “In Kerensky’s Russia, it unequivocally wasn’t – Tsarist Russia was an authoritarian feudal state, not a capitalist one.”

    Quick sleight of hand there I notice, as you go from Kerensky’s Russia to Tsarist Russia. Not the same thing. Also the Russian Empire had been moving in the direction of Capitalism for a long time before Kerensky.

    john b -“Weimar was closer to modern capitalism than Russia, admittedly; but there’s still a big difference between the pre-Keynesian economic stuff-just-happening of the 1920s and the policies directly influenced by neoliberal economic theory of the 1980s.”

    Yeah. The 1920s were more capitalist and free market.

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