Interview with Michael Hudson
-- in which Hudson goes into detail on how precisely the US and its agencies inside Venezuela have been able to destabilize the Venezuelan economy. This paragraph is critical:
First of all, oil refineries were not built in Venezuela, but in Trinidad and in the southern U.S. Gulf Coast states. This enabled U.S. oil companies – or the U.S. Government – to leave Venezuela without a means of “going it alone” and pursuing an independent policy with its oil, as it needed to have this oil refined. It doesn’t help to have oil reserves if you are unable to get this oil refined so as to be usable.
So that's how they do it. Hudson does, however, suggest that screwing Venezuela will have a price:
The U.S. has overplayed its hand in destroying the foundation of the dollar-centered global financial order. That order has enabled the United States to be “the exceptional nation” able to run balance-of-payments deficits and foreign debt that it has no intention (or ability) to pay, claiming that the dollars thrown off by its foreign military spending “supply” other countries with their central bank reserves (held in the form of loans to the U.S. Treasury – Treasury bonds and bills – to finance the U.S. budget deficit and its military spending, as well as the largely military U.S. balance-of-payments deficit.
Given the fact that the EU is acting as a branch of NATO and the U.S. banking system, that alternative would have to be associated with the Shanghai Cooperation Organization, and the gold would have to be kept in Russia and/or China.
So I suppose at some point the rest of the world is going to ask the US to "pay up," and the national obsession with capitalism (see e.g. President Trump's references to "socialism" in the State of the Union address) will come back to bite America hard. That point is no doubt a fair distance away, though.
Comments
Really Important Article
thank you for posting this, Cassiodorus.
Hudson connects the dots: US dominated global finance, US foreign military debt, stability of the dollar, gold reserves and Venezuela.
For those of us who have been wondering why those public figures who are opposed to Trump (e.g., Bernie, the progressives, and the dem party as a whole) have NOT come out in loud, round objection to the coup attempt in VZ but are gagged instead, Hudson tells you why.
They are, if Hudson is right, hobbled by the threat that if you can't stop Maduro you'll end up collapsing the US economy, with massive global effects. (Of course, VZ is acting consistently to preserve its political autonomy in the context of years of US policy, sanctions, "make the economy scream", etc.) This may also go some way toward explaining why China is allegedly making deals with Guaido.
Tulsi Gabbard's objection to US intervention in VZ is so shallowly based as to be a poor attempt to deflect any real public understanding of what path the US is going down and why. Compared to such froth, Hudson's analysis is a much-needed breath of cold, sobering fresh air.
"...you'll end up collapsing the US economy"
That seems baked-in at this point anyway.
The United States used to export manufactured goods. Now our primary export is Dollars.
And we are strongly driving foreign buyers away from that product.
Yes.
Was wondering, though: since Hudson predicts a reversion ("after the deluge") to another gold standard--what does this mean in terms of Modern Monetary Theory?
Isn't MMT based on fiat money and not on gold standard?
Is MMT merely the description of a passing/transitory economic state of affairs?
I'll have to admit that I am no student of economics!
So wouldn't be able to explain MMT let alone discuss some derivative based on it's definition. I do expect the U.S. economy to suffer greatly from reduced global dependence on the currency (I DO believe that the Dollar will remain a major currency for quite a while).
But America's position is delicate. The size of the debt, increased cost of imports and losing the reserve currency holding down both inflation and interest rates will all impact us domestically pretty rapidly.
The positive thing is that we SHOULD be forced to reduce our global military footprint.
I've never been a gold bug but will have to look into Hudson's take and evaluate how I might be able to hedge my other retirement assets by a dollar return to that standard. I have always been resistant to the idea of holding physical gold.
I have moved a decent segment of my IRA from domestic equity holdings to foreign ones including both developed and emerging markets in the last half-year. Also foreign local-currency bonds.
I've also been enlarging my home garden and am adding fruit trees now, plus gathering a variety of seeds in cold storage!
Yup.
Seemed important when I saw it on Facebook. PS where are the public details of China's deals with the Pretender?
"A reminder: the US has the #1 most expensive healthcare system in the world, yet we rank roughly #42 in life expectancy." -- Luigi Mangione
In the Hudson interview article
"However, Daniel Yergin reports in the Wall Street Journal (Feb. 7) that China is trying to hedge its bets by opening a back-door negotiation with Guaido’s group, apparently to get the same deal that it has negotiated with Maduro’s government."
WSJ paywall keeps me from checking this out further.
Not quite right about exporting oil
Venezuela does sell crude oil (to China for example). It can't refine it and use it itself, and there is value added in refining it so being reduced to simply exporting crude reduces revenue. One thing that I don't think Hudson mentioned is that US sanctions have made it very difficult for Venezuela to purchase supplies and spare parts, etc. for equipment to get the crude out of the ground. He is right, I believe, about the fact that there will eventually be a reckoning for our bullying. It will probably come initially in the form of erosion of the petrodollar which will lead to inflation and a significant reduction in US prosperity. We are living with a financial house of cards, so it could get ugly. The US is so militaristic that governmental responses could be very UGLY.
Hezbollah is in Venezuala?
Shades of Saddam has WMDs
Replicating Regime Change Playbook, Pompeo Says US Obligated to 'Take Down' Hezbollah in Venezuela
I suppose that the heavy sanctions we have placed on Venezuela has nothing to do with impacting the people of Venezuela. Nope, Move along, nothing to do with us.
Scientists are concerned that conspiracy theories may die out if they keep coming true at the current alarming rate.
They'll say anything
in the attempt to mask the actual lay of the land: that the US economy is a global house of cards that has resulted from horrible mismanagement for more than a half century now.
Impudent.
Last year on HBO John Oliver did a whole show on Venezueala
It was also the week of Venezuela's presidential election,pure coincidence I'm sure (s).
It was an hour of distorted facts,completely fabricated stories and blatant lies,in short he did his job and the HBO watchers got something that didn't even resemble the facts on the ground in Venezuela. All while laughing and getting laughter from the studio crowd, what a production of propaganda.
I doubt this information surprises anyone here but what I find important is this video 'Empire Files' put together debunking John Oliver's claims one by one, and doing a superb job at it with videos and testimony of the people of Venezuela.
However that isn't the only reason I bookmarked this video immediately after I watched it, the reason was the great collection of facts presented beyond just those used in response to John Oliver's lies. Facts available almost nowhere else I know of with the exception of at The Empire Files show on Venezuela which had a lot more detail than what was given in the following video.
When/if you watch this you'll see right at beginning how far off from the truth John Oliver gets by the time of his finale he has spun right off the rails.
The picture he paints at the end does not even resemble what was really happening on the ground in Venezuela which actually looked more like a real 'Democracy', by far, than any other Country claiming that label.
One last thing, I don't know when it happened but having not watched it for many months I was surprised when I clicked on the link. The first comment posted below it says it all.
"YouTube is trying to censor the video for absolutely no reason by making it age required. There is no reason for their claim for violating community standards."
But it works!
https://www.youtube.com/watch?v=_fV-C1Ag5sI&bpctr=1548793440
That's a shame.
Oliver, what a nuisance.
"A reminder: the US has the #1 most expensive healthcare system in the world, yet we rank roughly #42 in life expectancy." -- Luigi Mangione
Try this.
Just add nsfw in front of url.
https://www.nsfwyoutube.com/watch?v=_fV-C1Ag5sI&bpctr=1548793440
It sounds like the US
is banking on the world to see our economy as too big to fail. Austerity here we come. Sure bet that Wall Street gets paid off first.