- The Group of Eight world leaders are meeting for the
30th time in Sea Island, Georgia June 8-10 to consider the state of the
world. When considering the economic and political situation that confronts
the world in 2004, I could not but think of the parallels between 1973
when President Nixon called together a number of world leaders to meet
in the Library of the White House to discuss how the world should be managed
in a post-gold world and today.
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- The Group of Eight met officially for the first time
two years later in 1973 when French President Valery Giscard d'Estaing
called together six leaders from the U.S., Japan, Germany, France, Britain
and Italy to discuss common economic concerns. They became the Group of
Seven-G7 when Canada joined several years later and the Group of Eight-G8
when Russia was made a partner in all areas except finance in 2002.
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- The problems that confronted the world in the early 70's
are very similar to those that confront the world now. In 1971 Nixon severed
the dollar from the gold standard, in 1972 we imported foreign oil for
the first time which was an indicator to the Organization of Petroleum
Exporting Countries-OPEC of our new dependence and their new power, as
a result of the Yom-Kippur War and America's allegiance with Israel there
was the Oil Embargo of 1973 in which oil rose from $2.50 bbl. to $11 bbl.
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- That same year there were two several currency crises
which necessitated the closing of world currency markets (Valentine weekend
and the first week in March), thus paving the way for the dollar to float
on world currency markets. (It should be noted that the central bankers
of the world met at the Bank for International Settlements where they determined
the new value of the dollar.) Inflation climbed to 11%, interest rates
climbed to 12%, unemployment to 9% with federal deficits climbing to $70B
by 1975. In addition to the Yom Kippur War, America was involved in Viet
Nam from 1964 until the cease fire was signed in 1973. Two years later
after our withdrawal, South Vietnam was overrun by the communists and North
Vietnam. Saigon fell in May, 1975.
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- Several years later in 1979, the Shah of Iran fell when
the U.S. withdrew its support from him. As such, the Shah, though he ruled
through the secret police, the Savak, he was a stabilizing factor in the
Middle East. When he fell, oil went from $13 bbl. to $35 bbl, inflation
climbed to 16%, interest rates to 22%, unemployment to 11% and Federal
deficits rose to $100B. Gold rose to $808 oz.
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- There are those who look at the formation of the Group
of Eight as the need to create a "new forum for global governance"
to promote "global values of open democracy."
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- The Group of Eight today operates like a "global
board of directors." What they determine is really the path the rest
of the countries of the world will take-like it or not. By 1977, the heads
of state added their own personal G8 assistants who are called "sherpas."
The sherpas have "sou-sherpas" or assistants. The heads of state
meet once a year while the sherpas meet throughout the year in unrecorded
meetings setting the agenda for the forthcoming year. The presidency of
the G8 rotates between the heads. This year, the U.S. is president and
host. Next year, Great Britain will become the president and host and the
following year, it will go to Russia, and so on.
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- In the 1980s, the G8 heads of state began to add foreign,
trade and finance secretaries from their respective countries to meet and
consult with them and each other. These actions basically began the creation
of a "global cabinet" level of power. In the 1990s, employment,
environment, information technology, terrorism, crime and justice and energy
ministers were added. In this century, education, health and development
ministers have been added. What this means is that the respective country
secretaries of state, finance, employment, environment, energy, etc. meet
throughout the year and plan what they are going to do in order to meet
the goals set forth by the heads of state. Each ministry issues their own
report or communiqué which lays out their agenda. Their reports
are then part and parcel of the final heads of state communique. In preparation
for this year's meeting, the G7 Finance Ministers have met three times,
the G8 Foreign, Justice and Home Affairs Ministers and the G8 Labor Ministers
have all met.
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- As a result of the ever-growing G8 directives over the
past 30 years, the world has become one through integration. The G8 has
overseen the elimination of barriers between the nation-states. These barriers
include the economic with the passage of the 1980 (US) Monetary de-Regulation
Act which allowed Americans to invest overseas for the first time. Other
G8 countries passed similar laws about the same time to facilitate the
start of the monetary integration between the nation-states, in 1994 the
trade barriers fell when the U.S. passed the General Agreement on Trade
and Tariffs-GATT which became the World Trade Organization, effectively
tearing down trade barriers between countries-a process which is still
continuing today, in 1998 the legal barriers between the nation-states
fell when the International Criminal Court was birthed, in 1999, the world
was electronically connected through the "Y2K scare", and most
recently as a result of September 11, 2001, the military and intelligence
barriers fell between the nation-states. The Group of Eight is now spearheading
the harmonization of social security laws, retirement laws, tax laws and
other internal domestic areas to cement the total integration of the world
into a world governmental system. However, to the average citizen, they
would never use these words to explain what is and has happened. Instead,
they prefer to use words such as "globalization" which really
means there are no more borders between the nation-states or "interdependence"
which means our laws have been harmonized, thus leading to an "open
democracy."
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- Before we consider some of the agenda items on the minds
of the G8, let us take a look at the reality of the world that confronts
them. First there is no stability anywhere in the world: not in currencies,
economies or countries. Since the 70's the dollar, which was the strongest
currency in the world, has dropped in value over 66% from where it was
in 1975. Furthermore as a result of our burgeoning federal deficits-now
$7T instead of $70B when the G8 began to meet-the dollar has been dropping
against two of the world's major currencies: the newly birthed euro (1999)
and the yen. In addition, America is even more dependent on foreign oil,
the price of which exceeds the 1979 peak price of $35 bbl. by $5 bbl. Lastly,
the war we are now fighting in the Middle East with Iraq just may destabilize
the entire region, causing higher prices and greater world disruption and
war. There are reports that a military draft may be reinstated by mid-2005
and $28 million has been approporat4ed to bring the Selective Service System
up to date.
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- As a result of the high level of personal, local, country,
state and federal debt, interest rates are at 45 year lows versus 12% -
22% levels during the 70's in order to keep the economy functioning and
consumers spending. While low interest rates have helped to make real estate
attractive to the point that the prices of homes have doubled in the last
three years, Federal Reserve Chairman Alan Greenspan has been warning about
our ever larger trade deficits and personal debt. Is America the only country
deeply in debt? No, the whole world is as a result of the world going off
the gold standard in 1971 because there is no more accountability for how
much money is printed like there was under the gold standard.
- Is the state of the world better under the global leadership
of the Group of Eight? No. Do we have peace? No. Do we have stability?
No. The reality is that with the barriers between the nation-states gone,
it has provided the best of all worlds for those in positions of power
and money. They can now run rough-shod over the nation-states-moving monies
around the world on a daily basis at lightening speed looking for the highest
return and quickest return.
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- The global governmental system that has been set up through
the G8 will continue to advance in Sea Island. Last year, 206 commitments
were made. So now that we are one, what is next? The UN, as well as other
pro-world governmental study groups, has been talking about global taxation
for over ten years.
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- In order to foist global taxation, the UN has had to
come with a really good reason. This they did in 2000 at the UN Millennium
Summit where the kings, princes, presidents and prime ministers of this
world gave the UN their blessing to proceed to find ways to meet the following
goals by 2015: reduce the people living on less than $1.00 a day by and
those who suffer from hunger by 50%, ensure that all boys and girls complete
primary education, reduce by 66% the mortality rate among children under
five, reduce by 75% the ratio of women dying in childbirth, halt and begin
to reverse the spread of HIV/AIDS and other major diseases by 2015.
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- In order to accomplish these goals, the G8 has endorsed
the conclusions of the IMF/World Bank Development Committee which Secretary
Snow participates in which calls for increases in Overseas Development
Assistance-ODA, setting up a proposed International Financing Facility
and a whole host of other international taxation schemes.
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- Overseas Development Assistance was first proposed at
the Rio Earth Summit in 1992 as a way to help poor countries. While the
target goal is 0.7%, the U.S. currently gives 0.2% of GNP. Top recipients
include: Egypt, Russia, Israel, Pakistan, Serbia/Montenegro and Columbia
respectively. The proposed International Financing Facility will use the
pledges of developed countries to meet the Millennium Development Goals
and issue international bonds that can be sold in the bond markets.
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- Lastly, ideas about global taxation include environmental
taxes of various kinds, such as a carbon tax or a system of tradable permits
which is in the process of being set up, a tax on foreign exchange at the
rate of 0.02%, increase taxation on aviation fuel and/or air transport,
on shipping or arms exports, taxing resources held in the global commons
such as the mining rights in international waters through the Law of the
Sea treaty, and create and voluntarily redistribute additional Special
Drawing Rights-SDR's.
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