Re: Decline and Fall

[lethin@ai.mit.edu (Rich Lethin)]

In article <2tnlbgINNjss@life.ai.mit.edu> you write:
>Decline and Fall of the Nation State:
>
>Tuesday's WSJ had an article on how private money market funds are 
>starting to jawbone foreign governments just like the World Bank used to.
>
>Case cited was Fidelity Investments calling Mexican bank officials during 
>the Peso crisis after the recent assasination.  They said "we'll invest 
>another $18 billion (of ours and other fund's money) if you do what we say 
>and if not..."
>
>DCF
>
>"If they hadn't killed quite so many people, you'd almost have to feel 
>sorry for them."
>
>--- WinQwk 2.0b#1165
>                                                                                                      

Noam Chomsky spoke here in January and made the point that the increasing
mobility of capital increasingly holds governments hostage.  He felt that
it was the current greatest danger to democracy, because it bypasses any
leverage voters might have on politicians at the ballot box.

It's not clear how well his argument really holds together, though, since
the leverage that the mobile capital has is via the satisfaction of the
voters.  If capital flees a country, the population will be less
productive, dissatisfied and vote the politicians out of office.  So
policies that favor capital in some sense also favor labor.

Anyone else care to take shots at his argument or support it?

Mobile capital does mean that population and government lose their ability
to decree the relative rewards made to capital and labor.  If labor
requires too high a return, capital will go somewhere else.

The ownership and control of capital IS highly skewed, but since it's still
distributed among many parties, it is forced to compete and remain engaged,
lest it depreciate in value.

Go cyphercredits.