Financial Oligarchies vs. State Power | Michael Hudson

My articles about the origins of credit, money, and interest share a common frame of reference. From the inception of economic practices and enterprise in the ancient Near East, through classical antiquity and medieval Europe to today, wealthy classes have sought to transform themselves into an oligarchy that controls government and religion to protect, legitimize, and increase their wealth, especially their rent-extraction privileges as creditors, monopolists, or landlords.

 Marcus Licinius Crassus (115 – 53 BC): 

general, statesman, the richest man in Rome, and a textbook oligarch.

 

We see the same struggle through the ages, with financial elites opposing any government power capable of restricting their self-serving rent-seeking and creditor power at society’s expense. We see it today in the pro-creditor economic policies of the International Monetary Fund, the World Bank, and the ‘libertarian’ ideology, all of which seek to centralize power to allocate resources and plan economies within the financial sector instead of democratic governments. Today’s neoliberal idea is to eliminate government authority (except where it is controlled by rentier sectors) and let banks in the privatized financial sector control money and credit, which is the most important public utility.
 

That should be the context in which one examines every epoch’s economic view of the world, above all its perspective concerning how ‘free’ a market should be and just whose freedom is being endorsed. This has been the great question throughout the history of civilization—from the Bronze Age Near East, when rulers regularly proclaimed Clean Slates debt cancellations to restore economic order and check incipient oligarchies, through the five centuries of civil war in the Roman Republic and Jesus’s fight against the emerging Jewish oligarchy, to today’s civilizational struggle between the NATO West, dominated by U.S.-oriented rentier oligarchies, and the global majority now centered on the BRICS.

 Rare Anomaly: Populist Pariah Oligarchs Proclaiming to Serve the Common Good —  September 2, 2024.

China’s government has financed its remarkable industrial takeoff without having to borrow from private creditors. There was little money to borrow from its domestic population, so the Bank of China printed its own money. Unlike typical financial practice, it did not demand personal wealth be pledged as collateral because stock and bond holdings or substantial real estate did not yet exist. The government did not need to turn to bondholders to increase its public spending—and in any case, there were no domestic bondholders to borrow from in the wake of its Revolution. China did what any sovereign national government can do—what Abraham Lincoln did in the Civil War. It simply printed the money.

 

Quoted from:
Michael Hudson (September 1, 2024) - Reshaping Christianity and the Modern State: A Journey from Usury to Fiscal Power.

 

See also:
Stephen Mitford Goodson (2017) - A History of Central Banking and the Enslavement of Mankind.

BRICS+ Destroys The US And EU Currency Monopoly | Michael Hudson

There is no way that today’s international debt overhand can be repaid. That is as true for the United States as it is for Global South debtors. The US Treasury owes much more to foreign governments in the form of their holdings of US securities than it can foreseeably repay. It has post-industrialized its own economy, and has committed to spending enormous sums abroad, while its dependency on foreign imports is rising and its prospects for collecting its existing debt claims on deficit countries is looking shaky. The past half-century’s foreign investment has taken the form of privatization of the public domain of debtor countries. This investment has not helped them develop but has merely transferred ownership of their oil and mineral rights, public utilities and other assets. A viable international financial system requires productive investment such as China’s Belt and Road Initiative that can help countries prosper, not asset stripping. Dollar dominance will continue over Europe and other US satellites. Other countries that still need dollar reserves for their trade and investment with the United States can continue as it has. But what will be changed is a new basis for the international economy itself. There will not be a new BRICS currency in the sense of a dollar or euro that could become a medium for trade, investment or international speculation. There will only be a mutual "currency of settlement" of payments imbalances among central banks joining the new system. And that system itself will be based on principles opposite from the financialized neoliberal model being promoted by the Dollar/NATO bloc. That is the real context for the current discussion of BRICS+ economic reform.

President Putin was very clear when he recently talked in Valdai about a single settlement currency: "This definitely deserves our attention. It's a complex issue, and we have to solve it in one way or another." The Western press talks about how much wealth and reserves do the BRICS countries have. Naturally, you count their gold as a large part of their reserves. But where is the gold of the BRICS countries? Much of their gold is not in their own countries. It's in the New York Federal Reserve Bank, it's in the Bank of England and the gold of African countries is in the Bank of France. Right now, this gold is being held hostage. But countries can ask the US, the UK and France to give them back their gold. Germany tried to do that a few years ago and said, "Can't you begin to give us our gold back that was moved to your banks during the last seventy-five years of  US occupation? " And the US said, "Oh I'm sorry, we can't. We've already done something else with your gold. There are legal problems and we are not giving it back to you!" Now, let's say the BRICS countries would ask for their gold and if the United States and England and France will not return it, those countries could take compensation, including all of the foreign investments in their countries. They could do another thing: If, especially the African countries, say, "You've stolen our gold. You cannot expect us to pay our foreign dollar debts if you have come and seized our gold. Give us back our gold. You owe to us. And by the way, we're going to join the Shanghai Cooperation Organization so you can't send your troops in and do what you did in Libya and simply grab it." This is an element of the financial future that nobody in the West has talked about.

Quoted from:

Michael Hudson (Oct 07, 2023) - A BRICS+ Bank: How would it really function?

Michael Hudson (Oct 25, 2023) - BRICS Destroys the US and EU’s Currency Monopoly. (video)

The Return of the Heartland | Pepe Escobar

Pepe Escobar (Aug 24, 2022) - Putin himself first spelled it out at the Munich Security Conference in 2007. Xi Jinping started to make it happen when he launched the New Silk Roads in 2013. The Empire struck back with Maidan in 2014. Russia counter-attacked coming to the aid of Syria in 2015. The Empire doubled down on Ukraine, with NATO weaponizing it non-stop for eight years. At the end of 2021, Moscow invited Washington for a serious dialogue on “indivisibility of security” in Europe. That was dismissed with a non-response response. Moscow took no time to confirm a trifecta was in the works: an imminent Kiev blitzkrieg against Donbass; Ukraine flirting with acquiring nuclear weapons; and the work of US bioweapon labs.

The heart of Europe is Germany, the heart of Asia is China, and the heart of Eurasia is Russia. In his famous article The Continental Bloc:
Berlin-Moscow-Tokyo, published in 1941, German geographer Karl Haushofer wrote: "Eurasia cannot be suffocated while its two largest
people, the Germans and the Russians, strive in every way to avoid internecine conflict: it is an axiom of European politics."

[...] What Moscow is doing is talking to virtually the whole Global South, bilaterally or to groups of actors, explaining how the world-system is changing right before our eyes, with the key actors of the future configured as BRI, SCO, EAEU, BRICS+, the Greater Eurasia Partnership. And what we see is vast swathes of the Global South – or 85% of the world’s population – slowly but surely becoming ready to engage in expelling the FIRE Mafia (Finance, Insurance, Real Estate as per Michael Hudson) from their national horizons, and ultimately taking them down: a long, tortuous battle that will imply multiple setbacks.

 

"The New World Order is a battle for the meaning of the end of history. The great philosophical battle. It is time to close the page of exclusively
materialistic, energy and economic interpretations - this is not just vulgar, it is wrong. History is the history of ideas." Alexander Dugin, 2022

[...] The Global South though should never lose sight of the “Empire business”. The Empire of Lies excels in producing chaos and plunder, always supported by extortion, bribery of comprador elites, assassinations [...] Never underestimate a bitter, wounded, deeply humiliated Declining Empire. So fasten your seat belts: that will be the tense dynamic all the way to the 2030s. But before that, all along the watchtower, get ready for the arrival of General Winter, as his riders are fast approaching, the wind will begin to howl, and Europe will be freezing in the dead of a dark night as the FIRE Mafia puff their cigars.

Quoted from:
Pepe Escobar (Aug 24, 2022) - Geopolitical Tectonic Plates Shifting, Six Months On

See also:

 The Duran (Aug 21, 2022) - Discussing Ukraine. Glenn Diesen interviews Scott Ritter and Alexander Mercouris

Alexander Dugin (2019) - Multipolarity, Unipolarity, Hegemony - Theories and Concepts

Alba Popescu (2017) - The Theory of Global Domination - Russian Geo-Strategy Conceptual Framework on the Black Sea Region

TPR (2018) - Greater Eurasia: Russia’s New Energy Gamble  

TPR (2016) - One Belt, One Road: Eurasian Century Unstoppable