Belgium hit by general strike – by Duncan Robinson:
This is great news from Belgium. As for the related discussions, I find it a sidetrack to approach the question of Austerity as a “left-or-right” issue. Austerity is a menace to economy and to the society as a whole. To propose Austerity-measures as the solution to “handle the crisis” is not only a failed policy or honest mistake – it is in sheer contradiction with the actual route to Recovery as per the very principles of macroeconomics .
It is beyond comprehension that governments are pursuing such polices, as it ought to be evident by now to the respective decision-makers, not only as per theory but by experience as well: Austerity only worsens any recession, let alone reversing it.
We can only hope that the demands presented via Belgium’s anti-Austerity protests will be responded to properly and other countries will follow Belgium’s example. Otherwise our economies will enter an exponentially worsening cycle, a free-fall. The ever increasing odious public debt/deficit, austerity, cuts, privatisations and the permanent crisis resulting from these, will eliminate not only the working class but all segments of the middle-upper classes as well, with the exception of the top 1%.
If we consider the financial aspect of the topic, the gravity of the issue is even more apparent.
At the core of the problem we find a series of fictitious transactions resulting in the many £ / € / $ trillions of public debt. (The governments of countries on the IMF list at http://www.imf.org/external/np/exr/facts/gabnab.htm – Belgium included – all subject their respective countries to these transactions.)
According to the principles of modern banking, these loaned funds are newly created out of thin air upon the very act of banks lending them , which means these transactions come down to exchanging two empty IOUs between Banks and Governments:
1) The Bank ‘buys’ Bonds from the Government – lends money to the Government – from the NEW money that the Bank creates out of thin air for the transaction; that is, the Bank ‘pays/lends’ funds by merely issuing an empty IOU to the Government; which means, the Bank promises to pay X amount + y interests to the Government.
2) The Government ‘sells’ Bonds to the Bank – borrows money from the Bank – that is, the Government issues an IOU to the Bank in exchange for the Bank’s IOU; which means, the Government promises to pay X amount + z interests to the Bank, in exchange for the Bank’s promise to pay X + y to the Government.
This consideration renders the idea of “savings” in this context meaningless and misleading.
Rather than entering these phantom transactions with Banks, responsible and real democratic Governments could – and should – create and supply the money in the very amount that is necessary to be invested into their country’s economy and they should make these necessary direct investments – via Public Banking and without the burden of Debt – into constructive projects, creating jobs, fostering green energy, developing human-centered infrastructure, affordable healthcare, children-care, education, housing, etc.
 Flowcharts displaying how Austerity via the trickle-down myth worsens the Crisis versus the social-democratic policies that would yield economic Recovery