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.
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.
357 99 08 17 67
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
By Joseph Stiglitz
The Guardian (
November 6, 2008
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 exported its toxic mortgages around the world,
in the form of asset-backed securities.
exported its deregulatory free market philosophy, which
even its high priest, Alan Greenspan, now admits was a
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,
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
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
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,
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,
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
as the safest place to put one's money. No surprise, I
suppose, because, despite everything, a
guarantee has more credibility than a guarantee from a
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
than others. Those countries that did not fully
liberalise their capital and financial markets, such as
urging of Paulson and the
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
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
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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