The era of rating agencies

What's more powerful than the nation-state? Super-national organizations like U.N., IMF? Or Sub-national NGOs, multinational corporations? No. It turns out, rating agencies nowadays are calling the shots on the survivability of a state. They can downgrade a state in the U.S. or a nation in the E.U. They basically monopolized the determination of value in the world capital market, be it company debt or national debt.

What's significant about this is that they not only represent capital, but also direct the flow of capital in a totally professionalized global capital system. They observe their own rating rules, which on the one hand appear to be scientific, impartial and serving the interest of the so called "investors", while on the other very much self-serving to the interest of the agencies and ultimately the big shots that feed the agencies. So in this new era of reconfiguration of powers, we have a weired situation in which the nation-state and multilateral organizations are trying to reign in the rampant capital destruction, but at the sometime, financial capital, rescued by states, has already restored its mastership and advances towards a even higher position to control the fate of the state. Ironically, all of the problems are somehow squarely blamed on the sins of the governments and their "corruptions and wastes".

More interestingly, sovereign funds are among the very investors served by these rating agencies. Hence, no matter what position of your countries' public finance, huge deficit or huge surplus, your debts or funds are all serviced in the same interconnected market and the same dominant capital controlled rating agencies. There is no escape from this intricate, sophisticated, computerized, rationalized irrational financial market where wealth has never been concentrated to this extent. Practically, who owns the capital does not matter that much anymore, who operates such capital does. And these operators are in the same globally-linked class of elites trained by the same establishment, deployed to the same multinational institutions, and observe the same pro-capital ideology.

Such a development in the world capitalist system pits popular resistance or true democratic against the continuous marching of monopolized trinity, namely the banks, the insurances and the rating agencies. So far, democracy is loosing.