Sunday, November 9, 2008

Urgent alert from Gaza/Let's Throw Away the Rule Book

Sunday, November 9, 2008 2:45:53 AM

I am on the satellite phone with David. He is out fishing with Vik, Nicos and the Palestinians. They were attacked from the moment they passed the 6-mile limit. Water cannons and machine gun fire into the water. At 9:29, he called me again. The gunboat has come within 50 feet of the fishing boat and has cut across where the nets are.

http://www.freegaza.org/


Vik is yelling at the Israeli gunboat, telling them that three internationals are on board and they are all unarmed and they just want to go fishing. The pleas were met by water cannon so strong that all of the people on board went into the cabin for protection. David is trying to get water samples to bring back and have analyzed.

The connection is very difficult to understand, but I can hear Vik in the background and hear the machine gun fire and the water hitting the wheelhouse. They are trying to break the windows in the wheelhouse. Another fishing boat about 100 yards off is also being attacked. He then yelled in the phone that the boat was being hit by water from the front, that the Israeli gunboat is trying to actually break up the boat.

The connection just broke. Please send this alert out.
 
Greta Berlin
Media Team
Free Gaza Movement
357 99 08 17 67

www.freegaza.org
www.anis-online.de/office/events/FreeGazaSong.htm
www.flickr.com/photos/29205195@N02/

 

Let's Throw Away the Rule Book

 

Bretton Woods II must establish economic doctrines that

work in emerging economies as well as in capitalism's

heartland

 

By Joseph Stiglitz

The Guardian (UK)

November 6, 2008

 

http://www.guardian.co.uk/commentisfree/2008/nov/06/economy-useconomicgrowth

 

The world is sinking into a major global slowdown,

likely to be the worst in a quarter-century, perhaps

since the Great Depression. This crisis was "made in

America," in more than one sense.

 

America exported its toxic mortgages around the world,

in the form of asset-backed securities. America

exported its deregulatory free market philosophy, which

even its high priest, Alan Greenspan, now admits was a

mistake. America exported its culture of corporate

irresponsibility - non-transparent stock options, which

encourage the bad accounting that has played a role in

this debacle, just as it did in the Enron and Worldcom

scandals a few years ago. And, finally, America has

exported its economic downturn.

 

The Bush administration has finally come around to

doing what every economist urged it to do: put more

equity into the banks. But, as always, the devil is in

the details, and US treasury secretary Henry Paulson

may have succeeded in subverting even this good idea;

he seems to have figured out how to recapitalise the

banks in such a way that it may not result in

resumption of lending, which would bode poorly for the economy.

 

Most importantly, the terms that Paulson got for the

capital provided to America's banks were far worse than

those obtained by Gordon Brown (not to mention those

that Warren Buffett got for putting far less into

America's soundest investment bank, Goldman Sachs).

Share prices show that investors believe that they got

a really good deal.

 

One reason to be concerned about the bad deal that

American taxpayers are getting is the looming national

debt. Even before this financial crisis, America's

national debt was scheduled to increase from $5.7tn in

2001 to more than $9tn this year. This year's deficit

will approach $0.5tn; next year's will be even larger,

as the US downturn steepens. America needs a big

stimulus package. But Wall Street's fiscal

conservatives (yes, the same people who brought us this

downturn) will now be calling for deficit moderation

(reminiscent of Andrew Mellon in the Great Depression.)

 

Now the crisis has spread, predictably, to emerging

markets and less developed countries. Remarkable as it

may seem, America, for all its problems, is still seen

as the safest place to put one's money. No surprise, I

suppose, because, despite everything, a US government

guarantee has more credibility than a guarantee from a

third-world country.

 

As America sops up the world's savings to address its

problems, as risk premiums soar, as global income,

trade, and commodity prices fall, developing countries

will face hard times. Some - those with large trade

deficits before the crisis hit, those with large

national debts that must be rolled over, and those with

close trade links to the US - are likely to suffer more

than others. Those countries that did not fully

liberalise their capital and financial markets, such as

China, will be thankful that they did not follow the

urging of Paulson and the US treasury to do so.

 

Many are already turning to the International Monetary

Fund (IMF) for help. The worry is that, at least in

some cases, the IMF will go back to its old failed

recipes: fiscal and monetary contraction, which would

only increase global inequities. While developed

countries engage in stabilising countercyclical

policies, developing countries would be forced into

destabilising policies, driving away capital when they need it most.

 

Ten years ago, at the time of Asia's financial crisis,

there was much discussion of the need to reform the

global financial architecture. Little - too little, it

is now evident - was done. At the time, many thought

that such lofty appeals were a deliberate attempt to

forestall real reform: those who had done well under

the old system knew that the crisis would pass, and

with it, so too would the demand for reform. We cannot

let that happen again.

 

We may be at a new "Bretton Woods" moment. The old

institutions have recognised the need for reform, but

they have been moving at glacial speed. They did

nothing to prevent the current crisis; and there is

concern about their effectiveness in responding to it

now that it has hit.

 

It took the world 15 years and a world war to come

together to address the weaknesses in the global

financial system that contributed to the Great

Depression. It is to be hoped that it will not take us

that long this time: given the level of global

interdependence, the costs would simply be too high.

 

But, whereas the US and Britain dominated the old

Bretton Woods, today's global landscape is markedly

different. Likewise, the old Bretton Woods institutions

came to be defined by a set of economic doctrines that

has now been shown to fail not only in developing

countries, but even in capitalism's heartland. The

forthcoming global summit must face these new realities

if it is to work effectively toward creating a more

stable and a more equitable global financial system.

 

Copyright Project Syndicate, 2008.

 

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