Ian Welsh

The horizon is not so far as we can see, but as far as we can imagine

Category: Economics Page 22 of 89

The Fortune of the Commons

By

On December 7, 2020

Comments

There is a theory, called, “the tragedy of the commons” that if no one owns something, it will be overused.

You can see this in pollution. No one owns the air, so assholes over-pollute it because they get the profits and bear only a tiny part of the costs. When I was young the BC coasts had tons of clam and oyster beds. In the 90s people with no connection to local communities (Vietnamese) came along and stripped them clean. Made a lot of money, but destroyed most of the beds.

The problem is that these aren’t “commons”.

Commons are resources a community or group in the community manages together. The air and oyster beds weren’t managed.

The commons, in England and elsewhere, lasted for well over a 1,000 years. They were managed well, were over 90% as productive as enclosed fields and produced a far better standard of living for more people than enclosed fields, which were associated with throwing people off the land they had lived on for over a thousand years, so they could work over 80 hours a week in factories with horrific rates of dismemberment, in cities rife with disease where people died far younger and were ill far more often.

There is no tragedy of the commons.


What we call commons, aren’t. To be a commons, a group of people which benefit more from the continued existence of something than its destruction or degradation have to be charge in it. No short-termers or outsiders (people who don’t need it to continue in their lifetime and beyond) need apply. In the terms of Carse’s “Finite and Infinite Games” no one playing a finite game can ever be allowed close to a commons.

 

(It’s my annual fundraiser (and still running behind compared to past fundraisers) If you value my writing and can afford to, please consider subscribing or donating.)

It does make a difference.

 

The tragedy of the commons is that people who didn’t benefit from them continuing used the power of the state to break them up (enclose) them for their private profit, thus improverishing millions of people.

The modern tragedy of shared resources (which are NOT commons) is that the people in charge of them are playing finite games. My friend Stirling Newberry called this the death-bet. Simply put, the people fucking the world up with massive pollution and over-using resources, will be dead when the bet comes due. Nancy Pelosi, clinging grimly to power, is 80 years old.

The people you want in charge are people who are young and people who care about their great-grandchildren. Or, in the Haudenosaunee (Iroquois) phrase, for the next seven generations.

As for old people, the problem is twofold: first they think their money will help their kids, second they don’t /really/ care about their children or grandchildren. (Based on the behaviour I see, I assume most Americans don’t actually care much about their kids, especially once they’re adults. They scream that they do, but their actions show otherwise.)

They also have to be, for types of commons which are not global, locals, so that they can’t leave when things go bad. People who aren’t committed to the local area can’t be in charge of the long-term sustainability of a local area.

Put crudely, people who don’t have to eat where they shit can’t be in charge of anything.

Because this isn’t always possible, with global resources, you need to put people in artificial boxes. They need to experience the consequences of their failures. If they have both authority and power to act, after a certain time in office (and when out of office for a certain amount of time, so they don’t dodge their failures) they need to eat their own dogfood, to use the business expression. Make them live in the place with the worst pollution. If there are people there without a mask, then they don’t get to have one either. Make them drink the water. Make them eat the fish from the river.

This sort of personal responsibility, if combined with actual power, will clear problems up fast. If you want to make it really potent, give them a bit of time then make their non-adult children do the same.

In India there is a longstanding problem, not primarily environmental, but similiar, called manual scavenging. Simply put, untouchable (Dalit) caste members clean sewers and so on manually. No other jobs are available to them.

If you simply made it so that the governor and police chief and Prime Minister all had to do a day of manual scavenging every week till there was no manual scavenging (or so close to none as to unmeasurable) I guarantee this problem would be solved so fast your head would spin.

As for heads of industry, making the Shell CEO and every executive and all major shareholders eat fish from the Gulf oil spill for a year would be laudatory.

No wealth or power without responsibility for results. None. No scapegoats. If you have power, you’re in charge, no saying someone is responsible without giving them necessary authority.

The Ganges, in India, is horribly polluted and Indian politicians constantly wail, promise to do something and do nothing. Make them drink it every day, in front of witnesses, and the problem will resolve itself. (Sure, there can be some time lag. But perhaps make them drink one glass at the start of their term of office. Concentrate the mind a bit.)

No one gets to be in charge of anything unless they are affected by the results of their actions. Nothing.

This may seem similar to “Skin in the Game” by Taleb, but it is an ancient idea. Even in modern thinking, before Taleb, Jared Diamond made the same point in his book Collapse. But the idea is as old as civilization, and I am quite sure older.

As for the generational altruism idea, the ancient Greek saying was “a society is great when old men plant trees in whose shades they will never sit.”

We know all this, but in the modern era bunch of people who were either fools or evil or both, starting with Adam Smith (who was, admittedly, not quite as bad as his idea’s misuse would lead one to believe), created the idea that governing the world based on short term greed would lead to good results.

It did, for some people, and for a larger group for a while (that while is coming to an end.) It was based on genocide, enclosure (aka the violent removal of property rights from peasants) and the conquest of 70%+ of the world.

Or, if  you want another authority, Keynes,

Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.

Put that way, it’s pretty obviously nonsense.

The Tragedy of the Commons is that we don’t have properly constituted Commons, that is all.

 

SUBSCRIBE OR DONATE

 

The Rise of the Guillotine

By

On December 3, 2020

Comments

There was a time when almost no one would have put forward anything like the below, today, guillotine references are routine.


Back in the 2000s, I spent a fair bit of effort advocating for policies to help the majority of Americans and Westerners by pointing out to the wealthy and powerful that, historically, sometimes oppression ends very very badly. This effort failed abysmally, as have other similar efforts, sometimes by the brighter and more forward looking of our inbred overlords.

Fast forward to today, and these sorts of images are everywhere. What was once verbotten, because the Terror is taught to everyone to be the worst thing possible and the French Revolution as the bad revolution (as opposed to the American revolution, which was supposedly good, unless you were a slave or a native).

The terror was, well, a TERROR. The revolution did not last, but the vast majority of those who ruled pre-revolutionary France did, indeed, die. When the allies won, despite their attempts, the Bourbon restoration was a failure. The people necessary to have made it a success, were, simply, dead.

As I have noted a few times here, the Terror was less terrible than the millenium of oppression that came before it. For those who need the point spelled out in angry detail, Mark Twain has you covered.

(It’s my annual fundraiser (and going slower than normal this year.) If you value my writing and can afford to, please consider subscribing or donating.)

At any rate, Western elites have continued this process. Huge swathes outside the core of Paris are, I am told, essentially third-world slums. Vast numbers of Americans have been driven into poverty and homelessness and huge tent cities spring up, and then are cleared by police in the most punitive way possible (destroying homeless peoples’ possessions), but then spring up again, because what the hell are they supposed to do?

The middle and even the lower upper class lives in terror of falling out of their comfortable spot into the lower class or homelessness. Covid has vastly enriched the already rich and about triple decimated small businesses, while throwing further millions into poverty.

Americans are now willing to vote for men on horseback types, Trump proved that, even if he was a fake, a blowhard and essentially incompetent at anything but campaigning (which he was very, very good at, and if he hadn’t fumbled Covid, I am confident he would have been re-elected).

People are tired. Younger generations like the Millenials and Zoomers have never seen good times, and even X-ers only got a whiff of them, with most never having been part of them. The dotcom boom was short, and passed a lot of people by entirely. Same with boomlets like the Massachussets miracle.

The standard way to deal with the hoi polloi is to split them into groups and make them compete with each other. Our elites have dutifully run this playbook, and sometimes even very well, but as there is less and less upward mobility, less and less chance of being one of the blessed few (mobility has collapsed), this becomes harder and harder to pull off. People stop thinking they’ll ever get ahead, stop seeing the guy or gal next to them as the problem and look up towards the top to see who’s really oppressing them.

Add in the joy of climate change added to normal imperial decay and generational economic cycles and you have a triple whammy slouching down that road, baring its thousand mouths dripping with blood.

There was a possibility for a gentle revolution. For a sweet, kind, caring redistribution of wealth; a gentle and careful breakup of power and wealth, leaving the wealthy still rich, but not obscenely so, still powerful but not an oligarchy.

If that was going to happen, Corbyn would be Prime Minister (instead of virtually thrown out of the party, as Labor leader Starmer continues his purge of the left), and Sanders would likewise be President. Everything necessary was done to make sure neither of those things would happen, that the gentle revolution would die aborning. There will be no rebirth of the great society of the post war period, with environmental protection and equality for women and minorities added.

This being so, there will either be a steady state police-surveillance state, abetted by modern company store serfdom, keeping people in eternal debt and despair, or there will be revolution. That revolution may come from the right, or from the left. If it comes from the right, the oligarchs will mostly be okay, a few stupid ones will be made examples of (as Putin did with Russia’s oligarchs), the others will bow, patronage will go to the half of the poor willing to kill the other half, and life will continue.

If it comes from the left, well, the rich are right, that’s the real danger. At best they will lose everything, at worse, well, those guillotine memes tell you their fate. Machiavelli understood this, and he was right. When you hurt a man you must destroy him entirely: He must have no power left at all, or he will take vengeance. The left cannot tolerate oligarchs or anyone who was willing to work for them who does not jump to the left’s side immediately as the revolution begins.

Hopefully, it won’t be a Terror, but it may be, and it may be because people are terrified already and they want their overlords to feel what they have felt, to know despair and fear and hopelessness. They want revenge, and indeed, something that is close to justice, because their overlords, as Covid has demonstrated, have been killing them and impoverishing them for money for a couple generations now.

The guillotine is a symbol of the fact that the powerful aren’t always the only ones who may inflict terror.

If our elites were in any way wise, they would back down, but they are not, and so the guillotine will rise ever higher in our collective consciousness until, perhaps, it reaps its bloody harvest once again.

SUBSCRIBE OR DONATE

 

Abundance Mindset, Scarcity Economies and the Great Game Of Musical Chairs

By

On November 29, 2020

Comments

Like a lot of older Gen-X I remember the good times without having every participated in them. By the time I was an adult stagflation, the Federal Reserve, Reagan and Thatcher had done their work and the decline had begun. Everything kept getting shittier for most people in the western world and it has kept doing so for about 40 years now. Depending on what group you’re in, it might be fifty.

This has given rise to a whole body of how to get rich works. They rival those of the gilded age: Napoleon Hill’s “How To Think and Get Rich” is a good example. (The best of them is still “How To Make Friends and Influence People,” its advice will work as long as humans are human.)

The catchphrase these days is “abundance thinking”. There’s a ton of good stuff in the world, and you just have to figure out how to get some. The world isn’t full of scarcity, it’s full of too much.

This is, of course, true. There are money spigots, like various central banks, early entry to crypto, being attached to important resource economies like oil (though that’s ending) and so on. There are people who have way more money than they need, for whom money is a trivial concern, a way of keeping score, and those who just have too little.

You want to move to a position of abundance. You want to find a spigot. On the right this selling is courses on how to get fit or slim or rich or whatever. Sometimes the courses are bogus, sometimes they’re pretty good stuff, but they price them high and find desperate people to buy them.

So it is, so it always has been. Sell the dream to desperate people and you’ll get rich. Attach to a money spigot and you’ll be fine. It’s why the fights are so savage these days. Corbyn in Britain threatened the money-spigot attachment of Labour elites and they hate him for it and will do anything they can to destroy him. Nothing was too low to do to stop Sanders, because he would have brought in his own administrative class into the Democratic party. Democrats used many of the same vote suppression tactics against Greens and Sanders as they squealed about Republicans using against them.

It’s all about position. This is why the standard advice in prosperity circles is to ditch your loser friends and hang out with successful people. They’re attached to some spigot, or have found some vein of insecurity to mine and they can cut you in or show you how to get in.

(It’s my annual fundraiser (and going slower than normal this year.) If you value my writing and can afford to, please consider donating.)

But this is the larger issue: it’s all about position.

It’s a giant game of musical chairs. Some people are in abundance economies, other people are in scarcity economies (these have little to do with national economies, though it’s easier to get into an abundance economy in some places, obviously.)

But there are only so many money spigots and only so many people who can mine veins of insecurity. There aren’t enough good seats.

So the abundance stuff focuses on how you can become one of the winners, one of the people in an abundance economy. If you do it ethically, you help others get inside. If  you do it unethically, you’re just a parasite and you reduce the number of prosperity chairs. (Jamie Dimon, for example.)

The issue with all this, even when done ethically, is that even the “good” guys are rarely increasing the number of seats in the abundance economy. They’re just redistributing who gets them.

In econo or math-speak that’s a zero sum game. But because most of the people attached to money spigots like the Federal Reserve are actually reducing the number of good seats, it’s actually a negative sum game. Every dollar someone like Dimon earns hurts other people.

Abundance thinking could be a good thing: there’s no reason the world can’t be abundant. I am perfectly aware of limits to growth, but  every human could have a good life if we wanted them to. But right now it’s all about winners and losers. It’s about each of us, perhaps on team with the other “winners.”

You can win such games, of course, but they produce a world that is hell, and worse a world that keeps heading towards worse hells. This is how downward spirals happen: when we’re concerned only with a few people’s well-being, rather than the well-being of all.

Eventually the hell becomes so bad that practically everyone is in hell, with perhaps a few lords of hell still enjoying life (almost every post-apocalyptic story still has some people doing fine.)

This is the treadmill we’re on, as we seek to save ourselves from the horrible fates we see around us.

So we resort to “I see what it takes to be successful and I’m going to do it and I have those characteristics or can get them. I’m not a loser. I’m a winner!”

The worse things get, the more we focus on what it takes for individuals to grab onto a money spigot.

We grab a prosperity chair (or we don’t, I haven’t!) And that’s great, but the number of chairs relative to the number of people keeps going down, the carbon goes up, and every day more species go extinct.

And hell looms.

A solution that just works for a few is a solution: but it’s only a partial solution unless you don’t care about others, about the future, or about non-human life.

Not everyone, as we’ve designed the modern world, can live in an abundance economy.

Perhaps we should try for a world where people don’t have to do everything just right, or be born to wealth, to live well?

DONATE OR SUBSCRIBE

Know Your Enemies

By

On November 23, 2020

Comments

An enemy is someone who means you harm and has the means to inflict it.

A friend is someone who has wants to do good for you, and has the means to bestow it.

I once wrote primarily to predict and to change the world.

I now write to help a few people, those who listen.

So, listen, because other than understanding climate change is written in, won’t be stopped (can’t at this point, minus geo-engineering), this is the most important message I have for you.

You must know who wants to harm you and has the means.

Let’s start here:

“If America’s distribution of income had remained the same as it was in the 3 decades following the second world war… A low-income American earning $35K this year would be earning $61K. A college-educated worker now earning $72K would be earning $120K.

Everyone responsible for this is your enemy, unless you’re in somewhere between the top 4% to top 10%.

How much money, how much good, has the end of the post-war economic order inflicted on you? Adding in interest (because you wouldn’t be in debt, but have investments) it’s over a million dollar for almost everyone. You’d have a home and probably have the mortgage paid off if you don’t. You wouldn’t be drowning in student debt if young (especially since that order kept college costs down.)

(It’s my annual fundraiser (and going slower than normal this year.) If you value my writing and can afford to, please consider donating.)

So the people who are responsible have robbed you of a million or more dollars, and a good, prosperous life. These people had names. It started with with intellectuals like Milton Friedman and the oligarchs who funded economics departments to overturn the economic orthodoxy the old order ran on. It moved onto politicians, executive and CEOs. Margaret Thatcher, and Reagan; then Blair and Clinton, who made their victory complete. Thatcher understood that it was Blair who made her victorious, until Labour accepted “There Is No Alternative” they could have simply undone almost everything she did. Clinton, cutting welfare and smashing blacks and poor people in the face with punitive jail sentences, was Reagan’s heir more than George Bush Sr. ever was.(Biden, of course, was there for all of it and supported almost every shitty piece of it. Enemy. If you can’t manage “enemy, but perhaps not as bad an enemy as Trump, you can’t think.”)

This piece isn’t primarily about ideas and the influence of intellectuals and academics, but I do want to give another nod to Milton Friedman. Please remember, always, that in politics and economics ideas do usually come before action, despite everyone telling you otherwise.

1970, Baby! The sound you hear, to paraphrase Ross Perot, is your jobs going down the drain to every low wage countries around the world.

Now, here’s another fact: wage theft is almost equal to ALL other theft combined, except (get this) it isn’t considered a crime. That’s right, when your boss steals from you, it’s a civil/regulatory matter! 

Who’s the enemy?

Now, when it comes to dying, if you live in America or Britain or most of Europe, who is most likely to get you killed?

That dastardly Putin, twirling his metaphorical mustache and cackling about how much he hates the West, “muahahahahahaha, I hate democracy,” he cackles, or your own elites?  Did Putin send you or your children to war in Iraq or Afghanistan? Did he bungle your Covid response.

Did Putin do this?

It is very rare, unless you are an Iraqi, say, that the leadership of any country save your own is more dangerous to you than your own. On those rare occasions when they are, it’s because a great power is fucking you up (yes, sometimes that’s Putin, but not if you’re American or a member of the EU.)

Your enemies are you own elites. They are the people who price drugs so high you can’t afford them, fuck up a pandemic response so your parents and grandparents die, or send you to war. They are the ones who create economic policies which funnel money to the rich and impoverish you, and if you don’t think being poor isn’t bad for you, you ain’t ever been poor, that’s for certain.

So, when you prioritize the people to be wary of, to be scared of, and to hurt or harm if you ever can, remember, a wise person knows who their enemies are.

Be a wise person.

DONATE OR SUBSCRIBE

The US Can Have a Boom Economy Six Months from Whenever It Gets Serious

By

On November 13, 2020

Comments

From Architecture DiY

One of the great problems in the US — and most of the Western world — is that we have been unable to accomplish anything important for over 50 years. The last significant US project was the moon landing. Failure or muddled success is the norm, now. The US even loses or muddles all its wars, and when it “wins,” as with Libya, well, they “made a desert and called it peace.”

Because nothing really works, and because every effort is half-assed (some tax cuts and an underfunded program run by corrupt incompetents) we don’t think anything big CAN be done.

But plenty of big things were done in the past, and recently by other countries like China (who just industrialized in record time and build unbelievable amounts of infrastructure.) We have, in the past, been able to put up buildings almost overnight, send a man to the moon, mobilize most of the population, etc, etc, etc.

None of this is impossible today, it is especially possible for the US (other countries it can be hard for, because the international order is set up to cripple small and medium countries’ ability to act independently, but the US set up the order and is still a superpower, even if it is in marked decline.)

So, if you’re the US and you finally get serious, you can have a boom start in six months with a real Green Deal (no caviling, no trimming).

You make a mandate to get every single building energy neutral at least. The Federal government effectively guarantees all mortgages; it sets the norms. You state that no mortgage is considered conforming starting in a year to three years if it doesn’t meet the new standards.

(I am fundraising to determine how much I’ll write this year. If you value my writing and want more of it, please consider donating.)

You then offer the funds for the refit. This isn’t a gift, it is paid out of savings on utilities: half to the building owner so they win, half to the government. If you insist on doing this through financial markets, then half goes to the entity who puts up the fund.

You MUST create a proper auditing group to inspect a significant number of the buildings, so that there isn’t widespread fraud.

These refits are about passive and active solar, proper insulation and so on. Back in the 90s, it was possible to build an energy neutral building at -40 degrees Celcius, we can certainly refit buildings now.

Another conforming mortgage change is that lawns are no longer legal except on golf courses. Specify ecologically sane alternatives.

You take over/break up/heavily regulate all utilities, and have them do proper maintainance and set up grids which allow people to feed energy back in. Utilities are going to take huge income hits with this plan, so you’re going to have to support them, but that means taking them public or regulating their profits, dividends, and so on. You move grids and generation to as local as possible, because there is vast loss in energy by long distance transmission and because solar (passive and active) works best locally, because you need to store heat during sunny periods (both daily and annually). Of course, solar is not the only energy you use, and the emphasis is on reducing energy draw, and even more than changing the energy mix.

High-speed rail is a dead obvious thing to do, and proper high-speed rail is faster from city center to center when you take into account things like traveling to and from airports and security theater. A huge high-speed rail build-out, similar to the 50s expansion of highways, is an easy win (and traveling by plane sucks).

Note that most of these jobs cannot be off-shored or out-sourced. Refitting buildings is manual labor; building high-speed rail is done locally, and there are domestic companies who can build the trains. China dominates solar power, but there are ways to build up US industry, simply by equalizing prices through industrial policy. This can be done so both China and the US win; it doesn’t have to be zero sum.

Farming is a huge source of carbon emissions, but it doesn’t have to be. This isn’t about everyone going vegan, there are ways to make animals expel a lot less methane by changing their feed. Regenerative agriculture produces higher outputs per acre than standard industrial agriculture and requires more workers. If you want to break up the big farms, there is some evidence that small farms also produce more (ideal roughly what one person can work, which doesn’t mean no machinery.)

Vast planting of trees in cities in another no-brainer, as is an expansion of mass transit. Standard asphalt roads are expensive and have to be constantly re-paved. Moving them to alternatives like cobbled streets will lead to fewer emissions and reduce city budgets massively over time, again the alternatives take a lot of labor (if you’ve ever laid cobbles you’re wincing at the thought, but cobbles aren’t the only alternative).

There are a bunch of other things to do (for example, rebuild wetlands around cities and on the coast; build sea walls around cities which are too low, blah, blah), but the point should be obvious by now: You can help the environment, produce a massive number of jobs, and create an economic boom. It isn’t hard, though it is complicated. You simply have to have the will to do it.

Further, if you can get it going, it will soon have massive support because it will create a truly good economy for the first time in 50 odd years. People will have better things to do than squeal about red state/blue state bullshit, the era will be like the post-war period: People are making money, and having kids and politics would be, in fact, largely consensus-driven because everyone sees that what is being done works.

I first outlined this back at The Blogging of the President 16 years ago. Others have also suggested similar plans.

The most fundamental, irritating thing about the world today is that we know what to do to fix most of our problems, we just refuse to even consider doing any of it because we have corrupt, psychotic, decrepit, and incompetent leadership and populations who support them. We roar towards the abyss, staring in horror, refusing to simply turn the wheel. It’s amazing to see, a true lesson in how pathological human societies can be.

Boom, essentially tomorrow, any time we want it. Well, if we don’t leave it until our civilization is actually collapsing and we no longer have the resources. Which is the current glide-path.

Bullshit Economic Statistics

By

On October 15, 2020

Comments

So, I was going to write a state of play economics article today, but I can’t. Well, I could, but the article I originally intended would take a couple days of work, because I’d have to construct my own inflation indexes.

It’s reached the point where I completely don’t believe the American inflation numbers. I can’t use them. They’re in cuckoo-fantasy land. That means I can’t use the inflation adjusted wage numbers or price numbers, which means that to compare wages and their actual purchasing power I either need my own index or I need to take raw data and do compare and contrast series. I might do that one day, out of sheer cussedness, despite the work.

A good example of how broken price indexes (and thus inflation is) is the inflation in automobile prices. You will be relieved, and perhaps amazed, to know that automobile prices are flat for the last 20+ years.

This is based on hedonic adjustment: you see, cars are just that much better now, so all the nominal sticker prices increases haven’t actually happened because you’re getting more car now.

Maybe you are, maybe you aren’t, but if you don’t have a car you can’t drive one where you need to go. Something similar is done to computers, but my computer today is not much better than the one I had 20 years ago. Really, it is only better at pretty graphics, in every other way it is effectively as good at web surfing, word processing, spread-sheets and so on as it was then. In many ways I could argue it is less functional, it works less well than that computer did.

The truth is that for decades the prices of everything that matters: transportation, housing, health care and food has been rising in the prices actually paid by most people and rising faster than most people’s wages. But when you look at a real wage chart it shows that wages are rising faster than inflation.

This is wonderland-level bullshit. It is fantasyland “emperor has no clothes” mass pretense. 

Meanwhile places like the Fed and Treasury are basing policy on these numbers. “Oh, we need higher inflation” they squeal as the ignore the massive inflation in every part of the economy where a seller has pricing power or where they themselves have created a bubble. “We’ll use rent equivalent as a proxy for housing prices” they spewed as the housing bubble went its merry-way, because “the economy behaves as if it were what we want it to be!”

So I go thru these numbers over at FRED and I can’t use half of them. They’re just lalaland garbage, completely disconnected from reality on the ground.

Then you’ll have some reporter ask a politicians “so what does a banana cost” and they have no idea, because they don’t do their own shopping and haven’t in thirty years.

Lalaland. More delusional than the Red Queen or the Mad Hatter.

There are many ways that elites are completely disconnected from the consequences of their decisions, and one of them is that the systems designed to report to them conditions are so broken and corrupted that they are providing completely erroneous feedback, “inequality’s high, sure, but honest, most people’s wages are actually rising after inflation so it’s just not that big a deal.”

BULLSHIT. Absolute bullshit.

Everything I write here is free, but rent isn’t, so if you value my writing, please DONATE or SUBSCRIBE.

 

Delusion Regarding the Fall of Neoliberalism and Globalization

By

On September 25, 2020

Comments

So, the article below was published December 8th, 2015.

The pull quote is:

Neo-liberalism is nearing the end of its cycle. It will kill a lot of people dying, but its death is now ordained and can only be slowed by fanatical levels of police state repression in a few countries. And its death convulsions and the birth pangs of the new system will create a new age of war and revolution which will kill far more.

This is now as close to inevitable as human affairs, endlessly complicated and subject to unexpected shocks, can be.

Nothing has changed, the process has simply continued. Notice the repression going on in the US right now. Since I wrote it, the UK left the EU, there was massive resistance to Macron in France, and so on. We have massive fires all over the world: Australia, California, South Africa the Amazon and more. Wealth continues to concentrate at the top, etc, etc…

These convulsions take time. Slap the start of the actual fall as 2020, with the UK’s Brexit, and we’ve got 12 to 20 years to go. This one’s going to be bad, really, bad, simply because of climate change and our vast over-exploitation of limited resources. There’s going to be a lot of real hunger and lack of water, and so on.

The next age is undetermined, but one possibility is a centrifugal period. It is hard to imagine a future in which, India, for example, survives as a unified nation. For that matter, I’m not sure I’d put my money on China holding together over the middle run: 50/50 it’s fallen into warlordism by 2050 to 60.

The simple way to make your guesses is ask if a country can feed itself with domestic production AFTER the effects of climate change. If it can’t even feed itself now (or only barely); or if it is going to have serious water issues (water, obviously affects agriculture, so it’s not really two things), then the smart money is that it’s going to break up or lose effective control of various hinterlands.

And if you’ve got resources a more powerful nation on your border wants, well, that could go very badly for you. (My fellow Canadians, who seem clueless about how violent Americans are, should take note here.)

On the upside, this will be a very interesting period to be alive, if you can stay that way.

Natalie Nougayrède writes in the Guardian about The Front National’s victory in France:

Marine Le Pen has no solution for France’s problems, her economic programme is all about retreating from the outside world and Europe. Her social vision is of a mythical, homogeneous France that never existed. What she has to sell is an illusion. It’s only because so little else is on offer that people are buying.

This analysis is, there is no kinder way to put it, delusional.

And Nougayrède should know it, because she writes:

The impact of globalisation marked the end of what the French demographer Jean Fourastié coined Les Trente Glorieuses (The Glorious Thirty), the 1945-1975 period when France was modernising and increasing its international influence. There is much twisted nostalgia in the rise of the National Front.

Nougayrède blames this on the oil shocks, which the entire West failed to handle (note that Japan, far more vulnerable to the oil shock, DID handle it. Their later failure had other causes). She notes that France’s elites have not, since 1975, been able to turn things around, something I have noted as well.

But she is wrong about a retreat from globalization being delusional. The simple fact is that in France and almost every other country (including, by the way, most African countries), growth was better before globalization, and the proceeds of that growth were distributed to their populations much more evenly.

This is a fact, and you can only argue against it by invoking China (which used classic mercantalist policies, and was not meaningfully party to the 1945-1975 consensus economy.)

There will always be trade. There will always be global movement in goods, capital, and ideas, but more is not always better.  In fact, one can easily argue that more is rarely better.

As for “Europe,” the fact is that increased integration has not been to the benefit of most Western Europeans. That assertion is, again, extraordinarily hard to argue against and is especially true of the creation of the Euro.

Nougayrède wants France’s leaders to fix things, and not to fail, but she is very nearly as delusional as them. She admits that their failure has led to the rise of Front National, but cannot admit that their policies have failed, economically, along the lines that Marie Le Pen says they have.

Just because someone is a near-Fascist does not mean they are wrong about everything. I have no tolerance for LePen’s brand of Imperialism and cultural supremacy, but she, like Trump, is telling a lot of truths to a lot of people who feel like their country has been on the wrong track for a long time. (In the U.S., white, working class male salaries peaked in 1968. No matter how much you scream about white privilege, you are a fool if you expect white males to gravitate towards anyone who doesn’t at least pay lip service to reversing that.)

As an economic project, the EU is a failure for many of its members, including France. There are exceptions (Germany, Poland, etc.) but the losers cannot be expected to just sit there and take the beating forever. The “beating” has been exacerbated by Europe’s deliberate imposition of austerity. It is not just that Europe’s elites have failed to create a good economy, it is that they have deliberately made the economy worse for the majority of residents in many of its countries.

Until we can honestly evaluate the failures of neo-liberalism, and gut globalist cant which claims more trade and capital flows are always a good thing (and, even if they aren’t, are “inevitable”) we cannot fix the economy.

France, like about half of the EU, should leave the Euro. It should re-impose tariffs on a wide variety of goods and produce them in their own countries. Yes, they would cost more, but wages would be higher. It should also move radically to non-oil-based energy (as is true of, well, almost everyone).

These basic policies are not difficult. Corbyn is not wrong to say “make the necessary adjustments so it will work today, and go back to post-war policies.”  It failed,  yes, but it was the last economy which spread money evenly through the economy.  Make sure it’s not sexist and racist, update it for new energy technology, and try it. It may not be the best solution (I’d like some fairly radical changes), but it’s certainly not crazy, given that it did give France those 30 great years.

The failure to deal with the oil price shock doomed the post-war world, yes. But it is 40 years later and we have technology and knowledge they did not have.

Until the developed world’s sanctioned intellectuals (as opposed to pariahs like myself and my ilk) and their masters come to grip with these facts, the population will continue to turn elsewhere. They may turn to sane and reasonable people like Corbyn, or they may turn to people like LePen and Trump, but people will not put up with “it’s going to get worse for the forseeable future” forever.

We can have reasonable policies, which will make the world better for everyone (even if that means there will be a lot less billionaires–the Corbyn solution), or we can have the rise of fascists and their left-wing equivalents.

The room in the mushy middle for those who aren’t willing to do something radical to fix the economy and other problems is narrowing. It will continue to narrow.

Our current elites will not adjust, so the question is: Who will we get? Corbyn and FDR? Mussolini, LePen, Trump?

Neo-liberalism is nearing the end of its cycle. It will kill a lot of people dying, but its death is now ordained and can only be slowed by fanatical levels of police state repression in a few countries. And its death convulsions and the birth pangs of the new system will create a new age of war and revolution which will kill far more.

This is now as close to inevitable as human affairs, endlessly complicated and subject to unexpected shocks, can be.

If you enjoyed this article, and want me to write more, please DONATE or SUBSCRIBE.

The European Union

By

On September 21, 2020

Comments

CONTENT WARNING: *** MANDOS POST *** MANDOS POST *** MANDOS POST ***

Both inside and outside Europe, the left is highly divided on the topic of the European Union, with a large current being firmly against it for reasons that are actually quite understandable, from multiple perspectives (not just economic). The recent history, especially the Syriza episode in Greece, does not help the reputation of the EU from a left-wing perspective, and there is a temptation to see anything that damages the EU as being good for the people of Europe.  Jeremy Corbyn’s somewhat incoherent position towards the EU can therefore be dismissed by some as the result of a circumstance impossible for him, whereby a good chunk of Labour voters were supportive of EU membership while a principled leftist like Corbyn would have to, in their inner selves at least, be against it.  The EU’s association with neoliberal economic policy has led some, including a large percentage of this blog’s own commentariat, to view Brexit as just another stick with which to beat the neoliberal dog, so to speak, and to take at best a neutral view of who and how the stick is wielded.

It is absolutely correct to say that EU institutions have developed in such a way as to embed neoliberal attitudes and policies deeply within them. The institutions of European integration were largely built at the very same time as the neoliberal consensus’ apparent accession to the Mandate of Heaven.  (Providence does not hand out these mandates on the basis of evident goodness or wisdom.)  Starting from the late 2000s, it became obvious that neoliberalism was losing the Mandate, and no clear claimant has as yet emerged, a worrying sign.

The dilemma for those who want a more just and sustainable human future is extent to which the active dismantlement of the EU is necessary or warranted.  There is a left-wing position that is a kind of short-term nihilism which celebrates the destruction of institutions as a necessary step in creating the opportunities for beneficial change.  This position should certainly be taken seriously and becomes increasingly relevant as neoliberal institutions continue to operate in “zombie” mode, deprived of the providential imprimatur.

The ideal case is that the dismantlement of the EU would lead to a condition that was more beneficial, i.e., replacement from the ground up with, if not with a single institution, then with a collection of polities that are better empowered to serve the needs of their citizens.  The prospects for this can only be understood in terms of the forces that created the European Union (and its predecessor organizations) in the first place.  Europe as viewed from a Martian height consists of extremely unstable, contentious nation-states with badly drawn borders (as it is impossible in Europe, the birthplace of the nation-state, to draw the borders well).  A handful of these nation-states took advantage of a specific set of historical circumstances to become great colonial-imperial powers, but partly due to their own internal contradictions and external developments eventually lost their own heavenly mandates.  Present-day Europe, ex-EU, is a checkerboard of small states and middling industrial powers which had to reinvent themselves in the latter half of the 20th century.

A cursory, common-sense examination of Europe’s present-day geographic situation indicates that the checkerboard (or chessboard) analogy is more than apt.  European countries sit on geographically strategic (if resource-poor, relatively speaking) real estate between the current hegemonic military powers and become easy prey for the very colonial tactics Europe itself perfected.  The post-WWII architects of European convergence, themselves functionaries of states skilled in colonial tactics, were absolutely correct to surmise that Europe required a super-state level of organization that was at least partly independent of other power blocs in order to prevent being further carved up like a Thanksgiving turkey. The Middle East’s current, long-standing troubles illustrate clearly what can happen in that case.

The adolescence of European institutions during the neoliberal moment presents the central dilemma, because it itself is now a major threat to a protective European unity.  The question is: what is the optimal and most feasible way to lever out zombie neoliberalism without putting European countries at risk of “integration” into the pathologies already evident in the current hegemons?  The question is not an abstract one: one of Brexit’s consequences is that the UK likely will adopt an even harsher internal economic stance with integration into the weaker, less consumer- and worker-friendly economic regulation of the USA.

My own position is that the only way to resolve the deadlock is by the boring, difficult work of building cross-border, cross-polity popular solidarity both inside and outside the current EU.  It is the only way to enshrine the benefits of European integration with the necessary reform of the EU’s economic management.  Anything else — and admittedly, “anything else” is the most likely prospect — risks that those who live in Europe jump from the frying pan into the fire, following a mirage of dead-end cultural-nationalist idylls and emotional appeals to a clean, safe world that never really existed.

Page 22 of 89

Previous

Next

Powered by WordPress & Theme by Anders Norén