NEW ECONOMIC HUMAN RIGHTS TO WEALTH FOR ALL

A New International Economic Order

For over four decades, physical economist Lyndon LaRouche has provided the intellectual and political leadership in the fight for a new international economic order for the planet, for the purpose of ending the historic imperial control of monetarism and unleashing mankind's creative powers as a species in order to be able to fulfill the new human right of Wealth for All.

Investment using zero per cent Sovereign Government credit over one hundred years in new mega infrastructure projects in every country in the World, the Fusion Power Economy, Land Bridge, New Silk Road.

The profound impact of LaRouche's intellectual leadership is clearly reflected in the current actions being taken by the BRICS nations and others to create a new global financial architecture and strategic alliance among nations, with the recent establishment of the New Development Bank (NDB) and related developments.

A partial timeline of LaRouche's role in leading the fight for a new international economic order is chronicled below:

Lyndon LaRouche has provided the intellectual leadership for over four decades in the fight for a new international economic order.

Helga Zepp-LaRouche Tours Silk Road Route on Return Visit to China


 
Helga Zepp-LaRouche speaks on the New Silk Road at the 'One Belt, One Road' conference in Beijing, China.

Helga Zepp-LaRouche is invited to return again to China to tour the Silk Road route and address several high-level conferences on the Silk Road Economic Belt initiative of Xi Jingping. On September 5, 2014 she addresses a high-level forum in Beijing on the topic “One Belt, One Road" [PDF] along with Col. Bao Shixiu, Professor (Emeritus) of Military Science at the People's Liberation Army Academy of Military Science, who emphasizes in his speech the leading role of both Helga and Lyndon LaRouche in the campaign for the New Silk Road since the beginning of the 1990's [PDF]. The event, sponsored by China Investment magazine, which is an arm of the National Development and Reform Commission, the main economic policy planning commission under the State Council of the Chinese government, is the first of what is intended to become an annual event bringing together researchers from many Chinese think-tanks tasked with the mission of developing a program for President Xi Jinping’s Silk Road Economic Belt.

Helga LaRouche is also a participant in an international conference on the New Silk Road at Lanzhou University attended by representatives of the Chinese Ministry of Foreign Affairs and by the president of Russian Railways Vladimir Yakunin. Additionally, she is interviewed twice on the prime-time CCTV 'Dialogue' show, as well as on Chinese Radio International [PDF]. During the latter interview she states:
 


 
Helga LaRouche is interviewed by numerous Chinese media during her visit to China in September 2014.

"In these six months, tremendous developments have taken place. You had the strategically extremely important summit between President Xi Jinping and President Putin in Shanghai in May, and then in July, the equally important BRICS meeting in Brazil, which was followed by a summit between the BRICS countries and the heads of state of Latin America. And what has emerged out of this series of meetings is a fantastic development, namely, the shaping of a new financial order and a new economic system. And this is extremely important, because this has given tremendous hope to many other countries to finally go for the kind of development which is in their self-interest."

 

Thomas Piketty's Capital - Capital in the Twenty-First Century by Thomas Piketty, Arthur Goldhammer

The radical economist's book Capital in the Twenty-First Century has angered the right with its powerful argument about wealth, democracy and why capitalism will always create inequality as long as Real Wealth does not increase sufficiently to support humanity, as long as investment in mega projects in infrastructure are not funded, as long as Fusion Power is under funded as it has been for the last 40 years, as long as irrigation is under funded.

That capitalism is unfair has been said before. But it is the way Thomas Piketty says it – subtly but with relentless logic – that has sent rightwing economics into a frenzy, both here and in the US.


Piketty's argument is that, in an economy where the rate of return on capital outstrips the rate of growth, inherited wealth will always grow faster than earned wealth. So the fact that rich kids can swan aimlessly from gap year to internship to a job at father's bank/ministry/TV network – while the poor kids sweat into their barista uniforms – is not an accident: it is the system working as it is meant to work.

DO YOU THINK THIS IS AN ACCIDENT?

The Designed to Fail Principle of Poverty.

AUSTERITY TOO MUST BE PLANNED!!

If you get slow growth - why do we get slow growth? - alongside better financial returns, then inherited wealth will, on average, "dominate wealth amassed from a lifetime's labour by a wide margin", says Piketty. Wealth will concentrate to levels incompatible with democracy, let alone social justice. Capitalism, in short, automatically creates levels of inequality that are unsustainable. The rising wealth of the 1% is neither a blip, nor rhetoric.

To understand why the mainstream finds this proposition so annoying, you have to understand that "distribution" – the polite name for inequality – was thought to be a closed subject. Simon Kuznets, the Belarussian émigré who became a major figure in American economics, used the available data to show that, while societies become more unequal in the first stages of industrialisation, inequality subsides as they achieve maturity. This "Kuznets Curve" had been accepted by most parts of the economics profession until Piketty and his collaborators produced the evidence that it is false.

In fact, the curve goes in exactly the opposite direction: capitalism started out unequal, flattened inequality for much of the 20th century, but is now headed back towards Dickensian levels of inequality worldwide because invesment in real wealth has been stopped..

Piketty accepts that the fruits of economic maturity – skills, training and education of the workforce – do promote greater equality. But they can be offset by a more fundamental tendency towards inequality, which is unleashed wherever demographics or low taxation or weak labour organisation allows it. Many of the book's 700 pages are spent marshalling the evidence that 21st-century capitalism is on a one-way journey towards inequality – unless we do something.

If Piketty is right, there are big political implications, and the beauty of the book is that he never refrains from drawing them.

Piketty's call for a "confiscatory" global tax on inherited wealth makes other supposedly radical economists look positively house-trained. He calls for an 80% tax on incomes above $500,000 a year in the US, assuring his readers there would be neither a flight of top execs to Canada nor a slowdown in growth, since the outcome would simply be to suppress such incomes.

As all real fortunes are made off the books in Foundations, Ford, Rockefeller, Gates and are thus not liable for tax or in offshore banks in tax havens or International Companies who do tax deals with Governments in advance of Investment this too will not provide any taxes. The solution is not to overtax that which is less but the invest in more - with more wealth, more tax and no-one will notice it.

While bestriding the macro-economic agenda, the book's sideswipes against trendy micro-economics, often in footnotes, read like a sustained in-joke against the generation for whom all problems seemed solved, except the street price of cocaine in Georgetown.

The book has, in addition, mesmerised the economics profession because of the way Piketty creates his own world, theoretically. He defines the two basic categories, wealth and income, broadly and confidently but in a way nobody had really bothered to before. The book's terms and explanations are utterly simple; with a myriad of historical data, Piketty reduces the story of capitalism to a clear narrative arc. To challenge his argument you have to reject the premises of it, not the working out.

From page one he illustrates with visceral reminders of the unfair world we live in: he begins with the Marikana mining massacre and he never lets up. He marshals not just 18th-century interest rates as evidence but also the work of Jane Austen and Honoré de Balzac. He uses both authors to illustrate how, by the early 19th century, it was logical to disdain work in favour of marrying into wealth. That it has become so again busts the central myth of, and moral justification for, capitalism: that wealth is generated by effort, ingenuity, work, wise investment, risk taking etc.

For Piketty, the long, mid-20th century period of rising equality was a blip, produced by the exigencies of war, the power of organised labour, the need for high taxation, and by demographics and technical innovation.

Put crudely, if growth is high and the returns on capital can be suppressed, you can have a more equal capitalism. But, says Piketty, a repeat of the Keynesian era is unlikely: labour is too weak, technological innovation too slow, the global power of capital too great. In addition, the legitimacy of this unequal system is high: because it has found ways to spread the wealth down to the managerial class in a way the early 19th century did not.

If he is right, the implications for capitalism are utterly negative: we face a low-growth capitalism, combined with high levels of inequality and low levels of social mobility. If you are not born into wealth to start with, life, for even for the best educated, will be like Jane Eyre without Mr Rochester.

Is Piketty the new Karl Marx? Anybody who has read the latter will know he is not. Marx's critique of capitalism was not about distribution but production: for Marx it was not rising inequality but a breakdown in the profit mechanism that drove the system towards its end. Where Marx saw social relationships – between labour and managers, factory owners and the landed aristocracy – Piketty sees only social categories: wealth and income. Marxist economics lives in a world where the inner tendencies of capitalism are belied by its surface experience. Piketty's world is of concrete historical data only. So the charges of soft Marxism are completely misplaced.

The real problem is the lack of increase in real wealth.

A lack in the increase in real GDP.

A lack of increase in wealth of 10% per annum every year, in every country in the World.

And you think this is an accident?


Piketty has, more accurately, placed an unexploded bomb within mainstream, classical economics. If the underlying cause of the 2008 bank catastrophe was falling incomes alongside rising financial wealth then, says Piketty, these were no accident: no product of lax regulation or simple greed. The crisis is the product of the system working as it has been created to work, towards the creation of a fellahin economy and genocide for the poor.

One of the most compelling chapters is Piketty's discussion of the near-universal rise of what he calls the "social state". The relentless growth in the proportion of national income consumed by the state, because the national income is planned to get smaller and smaller, with not enough left too spend on benefits and the rich, spent on universal services, pensions and benefits, he argues, is an irreversible feature of modern capitalism. He notes that redistribution has become a question of "rights to" things which must be based on a continuous increase in real wealth to give us all – healthcare and pensions – rather than simply a problem of taxation rates.

The policy logic for the left is clear. For much of the 20th century, redistribution was handled through taxes on income. In the 21st century, any party that wants to redistribute would have to increase real wealth, not just income.

You would expect the Wall Street Journal to dissent, but the power of Piketty's work is that it also challenges the narrative of the centre-left under globalisation, which believed upskilling the workforce, combined with mild redistribution, would promote social justice. This, Piketty demonstrates, is mistaken. All that social democracy and liberalism can produce, with their current policies, is the oligarch's yacht co-existing with the food bank, failed state and World genocide - for ever.

Instead we need a real increase in wealth.


 

 

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