Pen Meets Paper June 28'10

Opinion by Helge Nome
The G8/20 conferences just finished in Ontario with shop owners in downtown Toronto being the main victims, aside from Canadian taxpayers that were arrogantly made to foot the bill for the “show me off” show by the PM’s office which by all accounts achieved absolutely nothing. If anything, the G20 conference brought the differences between the Europeans and Americans closer to the surface.The Europeans want to cut back on economic stimulus spending and the Americans don’t. I suspect the Obama administration people are fearful of major civil upheavals if their unemployment numbers continue to soar. And a lot of currently unemployed returned American military service personnel have learned how to handle a gun during their tours of duty in colonial wars, so the anxiety of our southern neighbor is understandable. (Some of us remember the long hot summers during the 1960ies.)
Meanwhile, the Germans in particular, with a more robust productive economy than the US at present, do not want to continue to issue IOUs against the future. They want to get things back into balance again, sooner rather than later. The British government is not far behind them. And our own Stephen Harper, in his aggrandized role as G20 host, is beating that drum as well.
What none of these gentile folk mention is that a good portion of the public debt is private speculative debt dumped into the lap of taxpayers by colluding politicians beholden to private interests. That is especially true in the US and we have all seen what happened in Iceland, whose shores have been vacated by the perpetrators of massive fraud against depositors from Holland and Britain. The 300,000 or so Icelanders are now being asked to pick up the bill while their banksters enjoy martinis and cook up the next scheme somewhere in the Bahamas.
Where is all this taking us on our bumpy ride into the future? Well, if you keep printing IOUs like the Americans advocate for, those IOU’s are going to be worth less and less as their numbers grow because the products and services they are supposed to represent do not exist. And the reason for this is that the IOUs are used for speculative purposes, more so than being used to stimulate growth in products and services available. They call it the “quick buck syndrome” or “gambling spirit” prevalent among drug dealers, for example.
The Europeans on the other hand, with Stephen Harper harping along, want to slash and burn, cutting public sector spending. The classical conservative mantra is that less taxes on the private sector will stimulate spending in that sector leading to increases in productive enterprise. The trouble is, credit available to the private sector has dried up because money has been diverted into the speculative economy by its owners who are keeping it there, hoping to make quick gains. The underlying problem is tunnel vision with “me” in the center of the tunnel.