German Finance Minister Peer Steinbrück attacked the American style of capitalism Friday and said that the “Black September” banking collapse would erode the “superpower status of the United States."
The unusual outburst in the German parliament was only the latest prediction by a foreign minister of eroding American power as the result of financial mismanagement. Intelligence experts and others have warned that if some bailout plan is not proffered soon, the resulting calamity could trigger lender nations to pull their money out of American investments.
Steinbruck used the occassion of the latest failed bailout effort to call for a sweeping code of regulations to “civilize the financial markets” and clamp down on speculators. The eight-point plan to reorder the global markets was already provoking fear in Britain tht the European Commission would intrude in its banking affairs, according to the Telegraph newspaper.
“The U.S. will lose its superpower status in the global financial system,” Steinbruck said, predicting a new multi-polar order where power is spread across the globe.
“The financial crisis is above all an American problem. The other G7 financial ministers in continental Europe share this opinion,” he said, a pointed turn of phrase that excludes Britain’s Financial Minister Alistair Darling.
“This inadequately regulated system is now collapsing, with far-reaching consequences for the U.S. financial market and contagion effects for the rest of the world,” he said.
In recent weeks, leading politicians in France and Germany have called for a radical shake-up of the market system. They see the U.S. bank failures as a means to push through long-held views on the regulation of capital markets. Earlier, Nicolas Sarkozy, the French president and current holder of the European Union presidency, called for an emergency G8 meeting on the crisis.
Germany and France want the Group of Seven rich countries to pressure the U.S. into global banking reforms, setting the stage for next month's meetings of the G-7 and International Monetary Fund in Washington. The G-7 — currently consisting of the U.S., Japan, Canada, Germany, France, Italy and the U.K. — will in the future have to invite other players, Steinbruck and other European leaders have said. China currently isn't a member of the G-7.
“They want to regulate the capital levels of every firm and partnership, limit takeovers and regulate asset stripping. In short, they want to regulate the Anglo-Saxon version of capitalism out of existence,” said John Whittacker, a British member of the European Parliament and a leading economist.
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