Egypt Protests the Bankers

01/30/2011 08:25 pm 20:25:27 | Updated May 25, 2011

The publics of Tunisia, Yemen and Egypt have called for new leadership. Western European countries are on the edge as well with protests from Greece to London. In Europe protests are clearly over the economic plight of their citizens. In the Middle East the issue of why governments are poised to fall is less well enunciated. In the Middle East the protest seems to be centered on corruption of governments. In the Middle East it seems that it's one thing to oppress, but it's a moral issue to steal.

But theft by autocratic as well as democratic governments is rampant and well established as the cost of doing business in many countries. Why find corruption unbearably unacceptable now, after a long tradition of it?

The answer is probably in part the human psyche. As long as things are getting better or at least not getting worse, people seldom rise to the challenge of rooting out a parasitic kleptocracy. It's just the way we are. Middle class Egyptian citizens are taking to the streets because things are getting significantly worse for them instead of at least remaining static. Street interviews in Cairo seem to bear this out.

People want to think we will all rise up if justice is not served. Sometimes we do. But we usually only rise up if the economic part of justice is not served. Our Declaration of Independence is a fine recitation of Enlightenment thinking on the intrinsic rights of men, but the Revolution was motivated by economic oppression. Oppress people's right to speak or assemble or bear arms (the U.S.A. being the exception) and you will not hear a peep from them as long as their path to a better future for their selves and their children is not impaired.

The Middle East is a powder keg because Middle Eastern economies lag western egalitarian access to personal prosperity. Among the desperately impoverished of Palestine are found candidates for the most desperate of all political acts, the suicide bomb. Poverty breeds violence like not other force on Earth. Muslim militancy is founded in economic injustice just as was our militancy against the crown of England.

So from Spain to Yemen, the harder pressed middle income and poor countries of the world are rising up in revolt over their sinking circumstances. Why, all of a sudden, have they determined to throw off their governments when they were not moved to it before? Some last threshold of despair has been reached that tips a society accepting of a certain amount of graft and corruption into revolt. That threshold is reached when a society is hurting and then the optics of an indifferent elite class of business/politician infuriates people.

The global Great Recession is the trigger for these world wide protests. The protracted recovery is causative in particular. Blaming those at the helm of international commerce is very appropriate as well as blaming your own government for doing nothing about it.

The greed of global banking and multinational corporations caused the Great Recession and they are causing the protracted recovery as well. Banks and business are behaving exactly as they did in the Great Depression of 80 years ago. Banks and business are hoarding cash. Banks aren't lending it and businesses aren't spending it. Banks fear that the collateral for new loans might deflate in value. Business fears purchases and real business investments might deflate in value as well as that the economy will not grow enough to pay for new employees. The adage of business at times like this is "you are foolish to hire until the unemployment rate goes down". Really.

Banks not only fear deflation, they fear inflation as well. So they lobby against economic stimulus and growth of the money supply because they fear losses in the bond market, U.S. Treasuries in particular. The deficit/debt furor was fabricated by the Bankers in order to prevent countries inflating their way out of the Great Recession, the easiest and most painless way in which it can be done.

So we are stuck, everyone in every country except certain Asian economies is stuck, and the way out is blocked by global banking and multinational corporations. The blame then falls to governments for doing nothing about it but instead acceding to Banks and Business to make matters no better and even worse. Governments will fall. They'll fall by popular revolt and in some cases it will be justified by their behaviors in matters less central to the real issue of economic prosperity. It's too bad really. If they would ignore the banks and business and do what's right by the people then they would not only survive, they would not have to oppress their people as harshly. The people would be happy enough. Democracy is not even necessary. You'd think the ruling classes of whatever forms of government there are would have learned that by now.

Economic well being feels just like freedom. Our own newborn Tea Party equates economic well being, and nothing else, to freedom. At least the Founders deliberated long enough to try and shore up the likelihood of maintaining economic freedom with plausible philosophical arguments as to what freedom actually means.