Yes, there’s a lot of presumed prior knowledge within the audience that will make the above confusing to non-experts as many terms demand definition. Those Gym readers who have followed the writings of Michael Hudson and diligently watched the weekly chats between him and Richard Wolff will have a much better understanding. Today’s chat ended with the issue of the conflict between China and the Outlaw US Empire that’s alluded to above. Much discussion into why developing nations are struggling to develop has transpired over the last 30 years and includes the argument why Neoliberal—or Corporate as it was called—Globalization was a bad gig for developing nations and is equated as an escalation in neocolonialism. What’s happened, however, is the neoliberal offshoring/deindustrialization of their host nations as part of Corporate Globalization enabled the low-end industrialization mentioned above that has grown significantly and reached a point where the core of the BRICS nations were finally able to free themselves from the debt bind and use the incoming capital flows for their internal investment—even low-end manufacturing requires a certain level of infrastructure support owned by the state, so the state was able to capture the monopoly rents on that infrastructure and reinvest it.
China and Russia have shown that it’s possible to have state owned banks provide disbursement of treasury produced monies in the form of investments for a host of projects all aimed at national development. A good case study is now happening within Russia—it’s development of a high-speed rail network from the ground-up. China has built more than 40 thousand kilometers of high-speed railroads and adds 3-4,000 kilometers annually, while Russia’s project isn’t nearly as aggressive, “In 2045, the length of the high-speed rail network will exceed 4.5 thousand kilometers.” Some of the component manufacturers will be private SMEs, but the entire project is state-owned and financed. The aim of both political-economies is to eliminate rent seeking and avaricious greed and behaviors that have a negative effect on developmental investment, growth and societal harmony. There’s a very good reason why almost all non-OECD nations have joined the BRI and want to join BRICS. But those nations also need to do housecleaning at home by ensuring strict government control over the financial sector or nationalizing it completely; and for those nations having odious debts to declare those debts odious and cease servicing them. Once freed from their debt-bondage, those nations can then direct monies their governments create into development projects built by their citizenry who then spend the wages they received back into the economy, and the economy grows.
Ultimately, when the financial basis for investment and development is owned and managed by the people, the major means of production are also owned and managed by the people. There can still be privately owned business within such a system, although IMO many will take on a cooperative nature since that’s the national ethos. Capital as such doesn’t need to be made into an ism as it exists in all economies as a tool. A cooperatively/socially owned enterprise still needs to generate a profit to pay its owners and invest in modernization of its plant. The key is to prevent excesses and monopsonistic situations, and when the latter occurs to nationalize that market segment so economic rents can be captured by government. The ultimate goal is to establish and perpetuate harmony within society and globally between all societies.
