Book review:


Patrick Brown

Paul Hellyer’s latest book, STOP: THINK, is a plain language analysis of the behavior of the mechanisms of the world economy over the last twenty-five years, together with the prescription for a massive change in direction. This is an important book. Hellyer, a long time Liberal cabinet minister, firmly stakes out his position as a revolutionary in a globalizing world. His disdain for economists is palpable.
When I was in university, forty years ago, we were taught that economic wealth was created in the capitalist system by the carefully managed conjunction of capital, labour, and materials. We were taught that this system could be used to improve the standard of living of any nation whose people were willing to become suitably educated and work hard. This received knowledge was the foundation of our ambition and our hope. Over the last half of this century our generation has found that the world was not as simple as our teachers would have had us believe. We were unprepared for the massive change in world economics which has occurred in the last twenty-five years, something Hellyer terms ‘the diversion of financial and real economics’. We were also unprepared for the uncertainty that it has brought to our own lives for downsizing, early retirement, currency devaluation, and the lack of progress towards universal human rights. Why? ‘For twenty-five years, rewards have gone to the financial economy at the expense of the real economy.’ says Hellyer. Now our children are told to lower their expectations, that they should not expect as comfortable life as we had. ’The new globalized economy’, they learn, exposes them to greater competition and an uncertain future. But thankfully, their ingenuity in rising to today’s challenges would put our generation to shame.
It is this last quarter century which is the focus of Hellyer’s book. He explains, plainly and bluntly, the shadowy presences that rule the macro-economic world: the International Monetary Fund, the World Bank, the North American Free Trade Agreement, the World Trade Organization, the Multilateral Agreement on Investment. He describes clearly the politics of national central banks and international commercial banks.
Hellyer explains how money is created today, by banks who make loans but have negligible reserve requirements( not what we learned in school). For all the outstanding international loans, he says, there is not sufficient real economic activity to pay the interest on these loans, let alone repay the principal. And so governments pay off or guarantee the loans, a process he terms ‘privatizing the profits and socializing the risks’. Hellyer’s challenge to todays financial orthodoxy is clear, it hasn’t worked, it isn’t working, and it can’t work. And he explains why in clear, forthright English in a concise 220 pages.
Hellyer identifies a ‘permanent government’ which he says holds the reins of real power. He identifies this permanent government as, ‘ the big supranational corporations with their lobbyists, public relations firms and lawyers, the international banks with their close ties to both the US Federal Reserve and the Treasury Department, not to mention the IMF the World Bank, the close, almost incestuous relationship between the Bretton Woods institutions and the State Department, the information conglomerates that blur the lines between the manufacture of news and culture and its dissemination......It is a power camouflaged by the diversions created by the antics of the politicians comprising the parallel provisional governments. ’The provisional government, he says, ‘oversees the production of pageants’. Hellyer is not a conspiracy theorist but he does illustrate how the evolution and the interaction of international mechanisms with perfectly laudable aims has resulted in a world economy dominated by traders in money, securities, operations, and ultimately, human lives.
National governments, he says, need real power over the creation of money in order to carry out their responsibilities: health care, education, environmental protection , and the care of the planet: an exclusively market-oriented economy will not employ people to do these things. He proposes demand management at a national level, and government control of national central banks. He’s a fan of direct democracy: referenda, citizen initiatives, and recall. ‘I believe,’ he says,’that people are more important than corporations or governments, than banks or bullies.’ Hellyer proposes a moratorium on debt for the millennium, and the institution of a Tobin tax on money trading, two ideas that seem only very recently to have penetrated the Canadian government, ‘Real security,’ he says,’ is impossible in an economic system lacking in moral resonance.
This subject matter is not simple, but Hellyer writes clearly and concisely. His book is up-to-date. He explains very recent events, he uses today’s examples to illustrate his points. He proposes alternatives which are revolutionary enough to be a danger to the greedy and the gamblers. This book should be read now rather than later, it deserves a wide audience, and even more widespread debate, it’s $18.95 in today’s Canadian money.

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