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Citigroup, Davos worry about popular backlash to Neoliberal Order

OWON: How often have we forewarned of what was coming. It will need powered sledge hammers to knock it into the skulls of the mass ignorant Sheeple that their Retiree Dream never was, and the Pot is dry. The Zios have looted the Private Funds and the State never did the Maths, or gives a dam.

Governments have for years misled the public about old age costs and social security. Now that the cupboard is bare, where does the money come from? Of course people are worried and angry about facing an uncertain future, where a secure one was promised. So now, how to kill you fast is the new criteria.

Job erosion is picking up steam adding to the angst and rising deficits. All the while while Governments try to lay blame elsewhere and raise taxes to put off the day of reckoning.

What a mess! What a sad end it will be for so many when their so naive trust implodes around their lives. How many have any concept of unfolding reality?

Citigroup, Davos worry about popular backlash to Neoliberal Order

Shadow Proof
By Dan Wright
25 January 2016

From January 20-23, the global elite met in Davos, Switzerland for the annual World Economic Forum. The themes this year were the dangers of inequality and terrorism to the current world order, an order those present have benefited the most from and have charged themselves with maintaining.

The founder and executive chairman of the World Economic Forum, Klaus Schwab, framed the issues as a problem of managing a so-called “Fourth Industrial Revolution” that was exacerbating inequality and allowing terrorists to use digital communication systems to coordinate attacks.

The Fourth Industrial Revolution, as defined by Schwab, is “characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.”

Schwab claims the changes in technology have led to increased economic divisions between high-skilled and low-skilled labor with “a job market with a strong demand at the high and low ends, but a hollowing out of the middle.” The trend will cause increased tensions within developed societies by intensifying already historic inequality, according to Schwab.

Citigroup echoed Schwab’s concerns that current economic trends will cause social problems with fears of a populist backlash or what Citigroup referred to as “Vox Populi risk.”

Vox Populi risk is a way of saying that countries and peoples living under the current neoliberal system may channel their opposition to it by supporting anti-establishment politicians at the ballot box and launching resistance movements. The consequence of these actions could bring down the system. (*Note: Citigroup previously addressed the risk of a populist backlash to neoliberalism in now-infamous “Plutonomy Memos,” like this one published in October 2005.)

To avoid this fate, Citigroup Chief Economist Willem Buiter recommends implementing a rather progressive policy program throughout the world that includes a major redistribution of wealth, though he is less-than-hopeful about the prospect of such a program being adopted in the U.S. Yes, Citigroup.

Via e-mail, he spelled out his concerns:

“Dealing with the growing inequality and possible growing job losses caused by the Fourth Industrial Revolution will require a much larger re-distributive role for the state. A guaranteed minimum income and universal state-funded health care, funded out of taxes would not raise many eyebrows in Europe. It would meet huge resistance in the U.S., where there only is a decent social safety net for the old.”

Medicare for all and a universal basic income? Part of that agenda is already being championed by Democratic presidential candidate Bernie Sanders. Whether he will prevail in the primaries and general election—let alone be able to implement those programs through a Republican Congress—seems unlikely at the moment.

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