Andrew Gavin Marshall: From Global Depression to Global Governance
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From Global Depression to Global Governance The role of the corporate
elites' secretive global think tanks
By Andrew Gavin Marshall
URL of this article: www.globalresearch.ca/index.php?context=va&aid=21504
Global Research, October 19, 2010
The following is the text of Andrew Gavin Marshall's presentation
at the book launch of The Global Economic Crisis: The Great Depression
of the XXI Century", Michel Chossudovsky and Andrew Gavin Marshall
(Editors). September 29, 2010, Montreal, Canada.
We now stand at the edge of the global financial abyss of a Great
Global Debt Depression, where nations, mired in extreme debt, are
beginning to implement fiscal austerity measures to reduce their
deficits, which will ultimately result in systematic global social
genocide, as the middle classes vanish and the social foundations
upon which our nations rest are swept away. How did we get here?
Who brought us here? Where is this road leading? These are questions
I will briefly attempt to answer.
At the heart of the global political economy is the central banking
system. Central banks are responsible for printing a nations currency
and setting interest rates, thus determining the value of the
currency. This should no doubt be the prerogative of a national
government, however, central banks are of a particularly deceptive
nature, in which while being imbued with governmental authority,
they are in fact privately owned by the worlds major global banks,
and are thus profit-seeking institutions. How do central banks make
a profit? The answer is simple: how do all banks make a profit?
Interest on debt. Loans are made, interest rates are set, and profits
are made. It is a system of debt, imperial economics at its finest.
In the United States, President Woodrow Wilson signed the Federal
Reserve Act in 1913, creating the Federal Reserve System, with the
Board located in Washington, appointed by the President, but where
true power rested in the 12 regional banks, most notably among them,
the Federal Reserve Bank of New York. The regional Fed banks were
private banks, owned in shares by the major banks in each region,
which elected the board members to represent them, and who would
then share power with the Federal Reserve Board in Washington.
In the early 1920s, the Council on Foreign Relations was formed in
the United States as the premier foreign policy think tank, dominated
by powerful banking interests. In 1930, the Bank for International
Settlements (BIS) was created to manage German reparations payments,
but it also had another role, which was much less known, but much
more significant. It was to act as a coordinator of the operations
of central banks around the world. Essentially, it is the central
bank for the worlds central banks, whose operations are kept strictly
confidential. As historian Carroll Quigley wrote:
"The powers of financial capitalism had another far-reaching aim,
nothing less than to create a world system of financial control in
private hands able to dominate the political system of each country
and the economy of the world as a whole. This system was to be
controlled in a feudalist fashion by the central banks of the world
acting in concert, by secret agreements arrived at in frequent
private meetings and conferences. The apex of the system was to be
the Bank for International Settlements in Basel, Switzerland, a
private bank owned and controlled by the worlds central banks which
were themselves private corporations."
In 1954, the Bilderberg Group was formed as a secretive global think
tank, comprising intellectual, financial, corporate, political,
military and media elites from Western Europe and North America,
with prominent bankers such as David Rockefeller, as well as European
royalty, such as the Dutch royal family, who are the largest
shareholders in Royal Dutch Shell, whose CEO attends every meeting.
This group of roughly 130 elites meets every year in secret to
discuss and debate global affairs, and to set general goals and
undertake broad agendas at various meetings. The group was initially
formed to promote European integration. The 1956 meeting discussed
European integration and a common currency. In fact, the current
Chairman of the Bilderberg Group told European media last year that
the euro was debated at the Bilderberg Group.
In 1973, David Rockefeller, Chairman and CEO of Chase Manhattan
Bank, Chairman of the Council on Foreign Relations and a member of
the Steering Committee of the Blderberg Group, formed the Trilateral
Commission with CFR academic Zbigniew Brzezinski. That same year,
the oil price shocks created a wealth of oil money, which was
discussed at that years Bilderberg meeting 5 months prior to the
oil shocks, and the money was funneled through western banks, which
loaned it to third world nations desperately in need of loans to
finance industrialization.
When Jimmy Carter became President in 1977, he appointed over two
dozen members of the Trilateral Commission into his cabinet, including
himself, and of course, Zbigniew Brzezinski, who was his National
Security Adviser. In 1979, Carter appointed David Rockefellers
former aide and friend, Paul Volcker, who had held various positions
at the Federal Reserve Bank of New York and the U.S. Treasury
Department, and who also happened to be a member of the Trilateral
Commission, as Chairman of the Federal Reserve. When another oil
shock took place in 1979, Volcker decided to raise interest rates
from 2% in the late 70s, to 18% in the early 80s. The effect this
had was that the countries of the developing world suddenly had to
pay enormous interest on their loans, and in 1982, Mexico announced
it could no longer afford to pay its interest, and it defaulted on
its debt, which set off the 1980s debt crisis collapsing nations
in debt across Latin America, Africa and parts of Asia.
It was the IMF and the World Bank came to the assistance of the
Third World with their structural adjustment programs, which forced
countries seeking assistance to privatize all state owned industries
and resources, devalue their currencies, liberalize their economies,
dismantle health, education and social services; ultimately resulting
in the re-colonization of the Third World as Western corporations
and banks bought all their assets and resources, and ultimately
created the conditions of social genocide, with the spread of mass
poverty, and the emergence of corrupt national elites who were
subservient to the interests of Western elites. The people in these
nations would protest, riot and rebel, and the states would clamp
down with the police and military.
In the West, corporations and banks saw rapid, record-breaking
profits. This was the era in which the term globalization emerged.
While profits soared, wages for people in the West did not. Thus,
to consume in an economy in which prices were rising, people had
to go into debt. This is why this era marked the rise of credit
cards fueling consumption, and the middle class became a class based
entirely on debt.
In the 1990s, the new world order was born, with America ruling the
global economy, free trade agreements began integrating regional
and global markets for the benefit of global banks and corporations,
and speculation dominated the economy.
The global economic crisis arose as a result of decades of global
imperialism known recently as globalization and the reckless
growth of speculation, derivatives and an explosion of debt. As the
economic crisis spread, nations of the world, particularly the
United States, bailed out the major banks (which should have been
made to fail and crumble under their own corruption and greed), and
now the West has essentially privatized profits for the banks, and
socialized the risk. In other words, the nations bought the debt
from the banks, and now the people have to pay for it. The people,
however, are immersed in their own personal debt to such degrees
that today, the average Canadian is $39,000 in debt, and students
are graduating into a jobless market with tens to hundreds of
thousands of dollars of student debt that they will never repay.
Hence, we are now faced with a global debt crisis.
To manage the economic crisis, the G20 was established as the major
international forum for cooperation among the 20 major economies
of the world, including the major developing or emerging economies,
such as India, Brazil, South Africa and China. At the onset of the
financial crisis, China and Russias central banks began calling for
the establishment of a global currency to replace the U.S. dollar
as the world reserve currency. This proposal was backed by the UN
and the IMF. It should be noted, however, that the Chinese and
Russian central banks cooperate with the Western central banks
through the Bank for International Settlements which the President
of the European Central Bank, Jean-Claude Trichet, recently said
was the principle forum for governance of central bank cooperation
and that the G20 is the prime group for global economic governance.
In 2009, the IMF stated that the BIS is the central and the oldest
focal point for coordination of global governance arrangements. The
President of the European Union, appointed to the position after
attending a Bilderberg meeting, declared 2009 as the first year of
global governance. The 2009 Bilderberg meeting reported on the
desire to create a global treasury, or global central bank, to
manage the world economy. In 2009, prior to the Bilderberg meeting
in fact, the G20 set in motion plans to make the IMF a global central
bank of sorts, issuing and even printing its own currency called
Special Drawing Rights (SDRs) which is valued against a basket of
currencies. In May of 2010, the IMF Managing Director stated that
crisis is an opportunity, and while Special Drawing Rights are a
step in the right direction, ultimately what is needed is a new
global currency issued by a global central bank, with robust
governance and institutional features. Thus, we see the emergence
of a process towards the formation of a global central bank and a
global currency, totally unaccountable to any nation or people, and
totally controlled by global banking i!
nterests.
In 2010, Greece was plunged into a debt crisis, a crisis which is
now spreading across Europe, to the U.K. and eventually to Japan
and the United States. If we look at Greece, we see the nature of
the global debt crisis. The debt is owed to major European and
American banks. To pay the interest on the debt, Greece had to get
a loan from the European Central Bank and the IMF, which forced the
country to impose fiscal austerity measures as a condition for the
loans, pressuring Greece to commit social genocide. Meanwhile, the
major banks of America and Europe speculate against the Greek debt,
further plunging the country into economic and social crisis. The
loan is granted, to pay the interest, yet simply has the effect of
adding to the overall debt, as a new loan is new debt. Thus, Greece
is caught in the same debt trap that re-colonized the Third World.
At the recent G20 meeting in Toronto, the major nations of the world
agreed to impose fiscal austerity or in other words, commit social
genocide within their nations, in a veritable global structural
adjustment program. So now we will see the beginnings of the Great
Global Debt Depression, in which major western and global nations
cut social spending, create mass unemployment by dismantling health,
education, and social services. Further, state infrastructure such
as roads, bridges, airports, ports, railways, prisons, hospitals,
electric transmission lines and water will be privatized, so that
global corporations and banks will own the entirely of national
assets. Simultaneously, of course, taxes will be raised dramatically
to levels never before seen. The BIS said that interest rates should
rise at the same time, meaning that interest payments on debt will
dramatically increase at both the national and individual level,
forcing governments to turn to the IMF for loans likely in the
form of its new global reserve currency to simply pay the interest,
and will thus be absorbing more debt. Simultaneously, of course,
the middle class will in effect have its debts called in, and since
the middle class exists only as an illusion, the illusion will
vanish.
Already, towns, cities, and states across America are resorting to
drastic actions to reduce their debts, such as closing fire stations,
scaling back trash collection, turning off street lights, ending
bus services and public transportation, cutting back on library
hours or closing them altogether, school districts cutting down the
school day, week or year. Simultaneously, this is occurring with a
dramatic increase in the rate of privatizations or public-private
partnerships in which even libraries are being privatized.
No wonder then, that this month, the Managing Director of the IMF
warned that America and Europe, in the midst of the worst jobs
crisis since the Great Depression, face an explosion of social
unrest. Just yesterday, Europe experienced a wave of mass protests
and social unrest in opposition to austerity measures, with a general
strike in Spain involving millions of people, and a march on the
EU headquarters in Brussels of nearly 100,000 people. As social
unrest spreads, governments will likely react as we saw in the
case of the G20 in Toronto with oppressive police state measures.
Here, we see the true relevance of the emergence of Homeland Security
States, designed not to protect people from terrorists, but to
protect the powerful from the people.
So while things have never seemed quite so bleak, there is a dim
and growing beacon of hope, in what Zbigniew Brzezinski has termed
as the greatest threat to elite interests everywhere the global
political awakening. The global political awakening is representative
of the fact that for the first time in all of human history, mankind
is politically awakened and stirring, activated and aware, and that
generally as Zbigniew Brzezinski explains generally is aware of
global inequalities, exploitation, and disrespect. This awakening
is largely the result of the information revolution thus revealing
the contradictory nature of the globalization project as while it
globalizes power and oppression, so too does it globalize awareness
and opposition. This awakening is the greatest threat to entrenched
elite interests everywhere. The awakening, while having taken root
in the global south already long subjected to exploitation and
devastation is now stirring in the west, and will grow as the
economy crumbles. As the middle classes realize their consumption
was an illusion of wealth, they will seek answers and demand true
change, not the Wall Street packaged brand-name change of Obama
Inc., but true, inspired, and empowering change.
In 1967, Martin Luther King delivered a speech in which he spoke
out against the Vietnam War and the American empire, and he stated
that, It seems as if we are on the wrong side of a world revolution.
So now it seems to me that the time has come for that to change.
Andrew Gavin Marshall is a Research Associate with the Centre for
Research on Globalization (CRG). He is co-editor, with Michel
Chossudovsky, of the recent book, "The Global Economic Crisis: The
Great Depression of the XXI Century," available to order at
Globalresearch.ca.
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