Since the collapse of the housing bubble in 2007-08, and the ensuing economic crisis that it triggered, many of the world’s bankers and financial engineers who caused this economic collapse have turned their attention to other areas of the world’s economy. In the US, bankers who help arrange bond offerings for towns, cities and municipalities have colluded with each other to push down the amount of interest a town or municipality receives on its bonds. They thus directly lowered the amount of income available to the municipalities who floated bond offerings for desperately needed funds as their tax base dried up and all the meager social services available are pushed to their limit by people in need.
Financial institutions and bond holders are demanding that governments impose austerity measures directly lowering the quality of life of people around the world so that governments can divert tax revenues from social services such as hospitals to pay interest on loans, bonds, etc. Much of Europe is up in arms. In the US, yet again, we hear the familiar call to curtail or end Social Security and Medicare – this time disguised as calls for austerity.
Given the magnitude of the theft of the bankers and financial institutions over the last ten (twenty? fifty?) years, and the forced diversion of tax revenues to pay interest to bankers and financial institutions instead of spending tax revenues on the needs of the people, is the call for austerity legitimate? How should we respond to this demand to lower our quality of life?