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THE COUNTRYMAN

NEWS

 

Selwyn Johnston

INDEPENDENT COMMUNITY REPRESENTATIVES'

ADVOCATE

(Cairns... Far North Queensland)

 

Thank you for visiting my on-line office. 

I appreciate your interest in the issues that effect not only Queenslanders, but all Australians. 

Please let me hear from you about your views on the issues that matter to your Family, your Community and your State.  

Sincerely,

Selwyn Johnston

 

One person, with the support of the community, can make a difference

 

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GLOBALISATION... A FAILURE! 


Globalisation is a concept and a state of being that has crept up on us and is now a part of our every day lives. Globalisation is one of those words that we have become accustomed to and whose meaning, or perhaps impact has changed as we have all come to understand its meaning and felt its impacts better. 

Initially globalisation was associated with better world wide monetary controls, better and more stable world trading conditions and more lately the world wide web, which has enhanced communications. Officially everything about it was upbeat. It meant simply that we were closer together as the various peoples of the world and as such this coming together, or being in closer contact, was undeniable. 

In more recent years the concept of globalisation has hardened and it now relates more principally to finance, financial services and trade. It involves the centralised control of all these things and that has not worked well for most individual nations. In fact in more recent times the concept has been forced upon the smaller nations by the bigger and more affluent countries despite objection of the people from those smaller countries. 

In addition, we are finding that globalisation and democracy are mutually exclusive in so far as that if our finance and trade powers are effectively removed what, of significance, do we really have to vote for. 

What we tend to forget is that the concept of globalisation is over 60 years old and so has grown upon us without our really knowing. Initially there were benefits as after World War 11, Europe and Japan were financially stressed, and physically destroyed and there needed to be created a stable basis for recovery. However, as to whether or not the system had to be so centric as the one introduced, and whether it had to continue for the period that it has is another question. 

Among the founding nations, France, to mention but one, thought that the various national governments should have had a greater say rather than leaving it all to an essentially American “free market”. Looking back at history it is now clear that our politicians of the day had no idea of the intent of the Bretton Woods Agreement that they were signing, or at least underestimated the significance of the moment. New Zealand was a much more reluctant starter. 

Between the World Wars most governments, including Australia, had created a Central Bank, and by the commencement of the second World War all had lost control and ownership of that Central Bank to the “free market forces” that now, post war, also to control of the international monetary system and trade arrangements. 

A reading of history of any kind of the post war period shows that because America was unscathed during the two international wars, it was economically stronger than the rest of the world and so managed things overtly to its own advantage. The U.S. dollar was set as the world reserve currency and its relationship to gold was initially fixed and then altered to suit the needs of the U.S. currency at the time of another expensive war. When the US currency was set as the reserve currency of the world and other currencies were pegged to it, all currencies, including the “greenback” had a defined relationship to both the US dollar and gold. This offered some stability and security though the limitations of a gold standard are well recognised. 

Over this 60 years the system hasn't stayed the same. In August of 1971 Richard Nixon, then President of the United States announced foreign central banks would no longer be able to convert $US into gold. In other words the $US and gold were decoupled and the backing for the $US was left as “confidence” or “trust”. At that point Bretton Woods died. What was left was an international banking system that was completely dominated and manipulated by Wall Street. and so the globalisation of the monetary system was well and truly centralised with no independent measure, now that the relationship to gold was gone. 

So Wall Street became the epicentre of the financial world and the outstanding control that it has had has only now become apparent to us with the present “financial crisis”. Though some expressed concern with the direction the US Federal Reserve was taking in the last few years they were promptly shouted down as “bears”. Too many Wall Street types have been exhilarated by the ride, and some even savy enough to escape the downfall unscathed. 

So, the present global crisis is part of the globalisation process, and the centralisation of financial power in Wall Street has been the unhappy legacy of that process. 

The second major aspect, trade, was also established immediately post the second world war . Like the finance aspect it has been driven by the “free market” philosophy and has had a similar level of “success” to the financial arm. Both sectors could reasonably be rated as absolute disasters. In trade we have seen firstly the European countries form a solid trading block and given the long standing relationship of the various peoples this union was beneficial to them. But the level of subsidisation has always been a disappointment to the rest of the world and the European Union's success has been at the expense of other trading countries rather than through efficiencies gained. 

The North American Free Trade Area combining the US with Mexico and Canada has had its high and low spots and, while many in Canada and Mexico would rate it as a serious failure, it does exist but essentially to the advantage of the USA. It can be no other way when countries of such disparate size and affluence are brought together. 

In both finance and trade Australia has its own experience. In late 2008, Australia probably to a lesser extent than the rest of the western world has suffered from the excesses of the Wall St inspired credit crisis. The centralised, or globalised nature of the “free market” philosophy so mistakenly promoted by ex US Reserve Bank Chairman Alan Greenspan is now exposed as an overt scam for all the world to see. It is interesting to note that Australia's lesser damage by the credit crisis is due in no small part to its trading relations with China, a non Wall Street dependent economy. 

On the trade side Australia's experience is much the same as that of Canada and Mexico. The Australia/ United States Free Trade Agreement that totally excludes Australia's primary industry sector for at least 20 years. That amounts to one of our great export strengths excluded from trade. No government, other than one that was totally subservient, would even entertain such an agreement let alone enter into it. So we have a “free trade” situation rather than a “fair trade” situation and there is no doubt in the future it will continue to haunt us. 

But the “Free Trade” philosophy is an integral part of globalisation, in both trade and finance, and as such is a warning bell for the further development of the concept and so, once again, it becomes apparent that centralisation and the “free market” concept, which is anything but free, work to the detriment of individual governments in looking after their own people. 

In the eyes of the more believing souls, globalisation also has a humanitarian aspect which has turned out at this time to be just a diversionary tactic ignored at will and without recourse. It has however remained a great political tool and has ushered in a level of hypocrisy never before attained by mankind. 

In the future however this humanitarian aspect, which is now establishing the world criminal court and the court of international justice, could well be turned at a later date against those who oppose the concept of globalisation or otherwise attempt to have national interests recognised. 

So there is little doubt that globalisation is presently a disaster but perhaps we are now only seeing the tip of the iceberg. Down the track we do not know what it will turn up but what we do know that for every step forward for globalisation there is a step backwards for democracy. 

If we are to maintain our independence and our truly democratic and egalitarian society then our erstwhile representatives had better have another look at both privatisation and globalisation otherwise... they will become irrelevant. 

For the immediate future privatisation is well worth watching. The trend has become apparent over the last 20 years or so and involved the disposal of all those service businesses that our forefathers developed mainly during a period when the Labor Party was just that. Now with stealth and enthusiasm that same Party is devolving those public utilities, the property of the people, to mainly foreign monopolists. 

Not only does this mean that we have lost the assets for good but we have also lost control of the pricing of the end product or service. We, as citizens will have no recourse as the “companies” controlling the product or service will be responsible to their shareholders, not the government of the day or the public. 

It is reasonable to suggest that the present “financial crisis” was a planned operation. So many professional people in such positions of power could simply not miss the “bubbles” that they were creating. Mr. Greenspan's response to the US Congress that he didn't believe that the banking system would go on to destroy itself is simply not good enough. The contagion was designed to be world wide and Australia is by no means out of the firing line. 

There is little doubt that the end result of this crisis will be some modification to the world financial system. The most likely outcome I would suggest is that there will be a need for more “controls” [read centralisation] but this time the central control will be irreversible. 

But then again it has been controlled before and after the 1930's crash but successive US administrations have removed all those controls to facilitate the present mess. 

Two things now remain for our party politicians. 

Firstly, they have to recognise what it is that is going on, and secondly, they have to have the balls to do something about it. The voting public is aware that the two-party system is a sham and now some 30% of voters direct their first preference vote elsewhere. 

It's just a shame that time will run out for Australians before it runs out for the party politicians. 

 

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Written and Authorised by Selwyn Johnston, Cairns FNQ 4870