World Economic News

Berlin 'Red-Red' Coalition To Sell Off Public Housing

The Berlin city-state's Social Democratic-Left Party (SPD-Linkspartei) coalition government was sealed on Nov. 6, with five departments going to the SPD, three to the Linkspartei. The crucial finance department will be headed, as before, by Thilo Sarrazin, whose prime target is to privatize as much as possible in order to reduce Berlin's public debt from 62 billion euros, to EU58-57 billion.

The sell-off of the 270,000 apartments still owned by the Berlin's public-housing authority is already being prepared by a 19-page memo on "facts and legends" that Sarrazin wrote against his critics: He claims that public housing is neither less expensive for tenants, nor more efficient, than privately owned apartments, and he insists that everything that the German Tenants Association and the German Municipalities Association have compiled as evidence against privatization, is "just wrong."

But the "Degeneracy of the Day Award" does not even go to Sarrazin; it goes to Gregor Gysi, chairman of the Linkspartei group in the Bundestag, who came out in defense of the Berlin city policy without even mentioning Sarrazin. Investments in industry to create new jobs, as the BueSo (Civil Rights Solidarity party, headed by Helga Zepp-LaRouche) has called for? Not so for Gysi: "We will enhance consumption powers, this will be an incentive to the economy, and an incentive to the economy will bring in taxes, so Berlin will improve." The consumption power of the locust funds is already waiting to buy, indeed: namely, Berlin's 270,000 apartments.

Former CEO of Korea Exchange Bank Arrested

Lee Kang Won, the former chief executive officer of Korea Exchange Bank, Korea's fifth-largest, was arrested Nov. 6 in connection with the sale of the bank to Lone Star Funds, the Texas-based hedge fund which bought the bank in 2003 at distress sale prices. Now, Lone Star is selling the bank for a profit of $4.4 billion, and, through subterfuge, paying no taxes. The case has caused outrage across South Korea. The prosecutors are also renewing their efforts (turned down the first time by the courts) to arrest the vice chairman of Lone Star, Ellis Short, and two other officers.