Posts Tagged ‘Federal Reserve’
Retiring the American dollar

Off into history’s sunset, like the cowboy. This image (modified) is called ‘Dollar Green’ by the artist mancaalberto (http://mancaalberto.deviantart.com/)
Seventy years ago, to the very month, a man named Henry Morganthau celebrated the creation of a “dynamic world community in which the peoples of every nation will be able to realise their potentialities in peace”. It was the founding of what came to be called the Bretton Woods institutions (named after the venue for the meeting, in the USA) and these were the International Bank for Reconstruction and Development – better known as the World Bank – and the International Monetary Fund.
None of the lofty aims that seemed so apposite in the shattering aftermath of the Second World War have been achieved, although what has been written are libraries of counter-factual history that claim such achievements (and more besides) commissioned by both these institutions and their web of supporting establishments, financial, academic, political and otherwise. Instead, for the last two generations of victims of ‘structural adjustment’, and of ‘reform and austerity’ all that has become worthwhile in the poorer societies of the world has been achieved despite the Bretton Woods institutions, not because of them.
Now, seventy years after Morganthau (the then Treasury Secretary of the USA) and British economist John Maynard Keynes unveiled with a grey flourish a multi-lateral framework for international economic order, the Bretton Woods institutions are faced with a challenge, and the view from East and South Asia, from Latin America and from southern Africa is that this is a challenge that has been overdue for too long.
It has come in the form of the agreement between the leaders of five countries to form a development bank. Russia’s President Vladimir Putin, China’s President Xi Jinping, India’s Prime Minister Narendra Modi, Brazilian President Dilma Rousseff and South Africa’s President Jacob Zuma made formal their intention during the sixth summit of their countries – together called ‘BRICS’, after the first letters of their countries’ names – held this month in Brazil.
What has been set in motion is the BRICS Development Bank and the BRICS Contingency Reserves Arrangement. Both the new institution and the new mechanism will counter the influence of Western-based lending institutions and the American dollar, which is the principal reserve currency used internationally and which is the currency that the IMF and the World Bank conduct their ruthless business in (and which formulate their policies around, policies that are too often designed to impoverish the working class and to cripple labour).
At one time or another, and not always at inter-governmental fora, the BRICS have objected to the American dollar continuing to be the world’s principal reserve currency, a position which amplifies the impact of policy decisions by the US Federal Reserve – the American central bank – on all countries that trade using dollars, and which seek capital denominated in dollars. These impacts are, not surprisingly, ignored by the Federal Reserve which looks after the interests of the American government of the day and US business (particularly Wall Street).
In the last two years particularly, non-dollar bilateral agreements have become more common as countries have looked for ways to free themselves from the crushing Bretton Woods yoke. Only this June, Russia’s finance minister said the central banks of Russia and China would discuss currency swaps for export payments in their respective national currencies, a direction that followed Putin’s visit to China the previous month to finalise the gigantic US$400 billion deal between Gazprom and China National Petroleum Corporation (CNPC). It is still early, and the BRICS will favour caution over hyperbole, but when their bank opens for business, the sun will begin to set on the US dollar.
Occupy Everywhere
The Occupy Wall St movement is spreading quickly across the USA. Mother Jones magazine has put together an interactive map on where the protests are spreading to, and at last count there were over 60 locations!

An Occupy Wall Street protester yells at police officers as they make arrests in New York, Wednesday, Oct. 5, 2011. Protesters in suits and T-shirts with union slogans left work early to march with activists who have been camped out in Zuccotti Park for days. Photo: Seth Wenig
The ‘Occupy’ demonstrations are the blowback – long overdue – of the foreign-plus-financial policy of a great power which has for long dampened criticsm and fair a representative politics at home.
The ‘Occupy’ demonstrations express a broader public understanding that the basic source of the crisis facing millions of people lies in the social interests of the sprawling and powerful global financial system – of which Wall St is one symbol; a powerful symbol but nevertheless one amongst many similar symbols.
Dogged by debt and haunted by ever newer forms of deprivation, the American protesters have ‘taken’ Wall St to call and end to the reign of the giant banks that dominate the US and world economy. Their politics is determined not by the popular will, but by the interests of a cunning financial aristocracy ruthlessly absorbed with defending its wealth by impoverishing the majority of their fellow citizens.
The answer – Occupy Everywhere!
Mother Jones has provided a very useful timeline of the Occupy Wall Street movement:
- July 13: The Canadian magazine Adbusters makes a call to Occupy Wall Street.
- August 30: The hacktivist collective known as Anonymous releases a video answering the call and encouraging others to follow suit.
- September 17: Nearly 1,000 gather to protest corporate greed and begin occupying the financial district in New York City.
- September 19: Roseanne Barr is the first celebrity to lend support to the so-called NYC General Assembly.
- September 20: The NYPD starts arresting protestors for wearing masks, citing an arcane law that prohibits masked gatherings of two or more people with an exception: “a masquerade party or like entertainment.” The police soon become more forceful.
- September 22: Demonstrators interrupt a Sotheby’s Auction, “in a show of solidarity with the art handler’s union that had been locked out.” This is the first instance of labor unions and the movement locking step.
- September 24: 80 protestors are arrested during a peaceful march; a video of a police officer pepper-spraying a nonthreatening woman goes viral.
- September 26: Anonymous allegedly leaks the name and details of the police officer who wielded the pepper spray.
- September 27: The Occupy Wall Street campaign comes out in support of postal workers who are protesting their reduced five-day work week.
- September 28: Transport Workers Union votes to support Occupy Wall Street; over 700 Continental and United Airline pilots demonstrate in front of Wall Street.
- September 30: More than 1,000 demonstrators march on NYPD headquarters, protesting the police response against the demonstrators.
- October 1: Over 700 demonstrators are arrested for marching across the Brooklyn Bridge and blocking traffic.
- October 5: Major labor unions endorse the movement and join in a march on New York’s financial district. According to ABC News, as many as 15,000 participate in the march.
The New York Observer has 50 portraits of people who have been in on the action in New York City. The Nation‘s Greg Mitchell is blogging “Occupy USA” developments daily. The Guardian is also producing ongoing coverage.
- Live footage of Zuccotti Park can be found at the protest epicenter’s viral webstream, Global Revolution.
- The #occupywallstreet hashtag (as well as #ows and #occupywallst) has been the main engine on Twitter.
- OccupyTogether.org supplies a range of DIY downloadable posters.
- There is an Occupy Wall Street social app called The Vibe, which allows demonstrators to communicate anonymously.
- An Occupy Wall Street publication was launched on Kickstarter, originally asking for $12,000 in seed money to get the publication rolling. The project surpassed its funding goal and has now raised over $40,000.
- A Tumblr account, We Are the 99%, allows users to post personal anecdotes and stories about why they consider themselves part of the economically disaffected majority.