Michael Hudson on government

Another extract from the iconoclastic Michael Hudson’s J is for Junk Economics (p.109-110), in this occasional series:

Government: From the Greek root cyber, meaning “to steer,” this social control function historically has been provided by public institutions at least ostensibly for the general welfare. Sovereign states are traditionally defined as having the powers to levy taxes, make and enforce laws, and regulate the economy. These planning functions are now in danger of passing to financial centers as governments become captive of the vested interests. The FIRE (Finance, Insurance and Real Estate) sector and its neoliberal supporters seek to prevent the public from regulating monopoly rent, and also aim to shift the tax burden onto labor and industry.

The recently proposed Trans-Pacific Partnership (TPP) agreement and its European counterpart, the Trans-Atlantic Trade and Investment Partnership (TTIP), would compel governments to relinquish these powers to corporate lawyers and referees appointed by Wall Street, the City of London, Frankfurt and other financial centers. The non-governmental court would oblige governments to pay compensation fines for enacting new taxes or applying environmental protection regulations or penalties. The fines would reflect what companies would have been able to make on rent extraction, pollution of the environment and other behavior usually coming under sovereign government regulations. Making governments buy these rights by fully compensating mineral and other rent-extracting businesses would effectively end the traditional role of the state.”

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One thought on “Michael Hudson on government

  1. Ceterum censeo EU esse delendam: Those complaining about TPP should acknowledge that the EU is an even larger scheme to “compel governments to relinquish” powers given to them to serve the interests of those that have lend them power via democratic elections. The electorate should be able to retract the power politicians borrow from them – yet it is this vital capacity of a democratic people that the EU obstructs with the greatest efficiency.

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