"... Therefore, the neoliberal project, considered under the aspect of justice, was destined to implode, and known to be so destined from the very beginning, since ultimately for popular acceptance it depends on redistribution, but "winners seldom, if ever, compensate the losers." So why throw good money after bad? ..."
"... Second, neoliberalism puts markets first . Always. So there's no reason to think that losers will ever be compensated, because there's no market in doing that. In any case, how do you put a price on a destroyed Main Street or a child dead from opiates? ..."
"... The neoliberal project has finally failed. It cannot secure a popular mandate, and by its nature cannot ever secure one. Therefore, anyone dedicated to an open society should not fund it. One might argue that alternatives to that project should be funded, but I think (see above) that only small-d democratic projects can create such alternatives, and they should be self-funded. ..."
"... Everything Lambert states he is correct, but as much as Soros's money is amplified by and mirrors NED and USAID money, it might be his job to invest in Democrat, Neoliberal, and Regime Change projects. He seems to function as a front/shell company like Chaz T. MAIN (Confessions of an Economic Hitman, John Perkins) or Business International Corp. ( http://johnpilger.com/articles/power-illusion-and-americas-last-taboo ) ..."
"... Soros and the State Department (or the dominant faction thereof) have roughly the same prescription for Russia and Eastern Europe. So no need at all to hypothesize one as a front for the other. ..."
"... It's not inconceivable. Think of Pierre Omidyar and USAID in Ukraine ..."
"... Agreed. Just a dumb excuse to persuade people we can't have nice things. Obama may have campaigned on "Yes We Can" in 2008 but Hillary in 2016 was the soaring voice of "No, You Can't." ..."
"... Pretty clear from the rich people and a few very rich people I have encountered, professionally and personally (once shared a secretary with Bill Gates Sr.) that the empathy and comity and decency drivers never got installed with the original programming. ..."
"... Everything Soros does is to line his own pockets I'm afraid. This will fall on deaf ears. For them, it's never enough money. That is what this is really about. Behind the curtains, you are dealing with a bunch of people who care nothing about the collective good and everything about their own net worth. Nothing else matters to them. ..."
I find the current moment in history very painful. Open societies are
in crisis, and various forms of closed societies – from fascist
dictatorships to mafia states – are on the rise. How could this happen?
The only explanation I can find is that
elected leaders failed to
meet voters' legitimate expectations and aspirations
and that this
failure led electorates to become disenchanted with the prevailing
versions of democracy and capitalism. Quite simply, many people felt that
the elites had stolen their democracy.
Not to mention their money, as the foreclosure crisis showed.
After the collapse of the Soviet Union, the US emerged as the sole
remaining superpower, equally committed to the principles of democracy
and free markets. The major development since then has been the
globalization of financial markets, spearheaded by advocates who argued
that globalization increases total wealth. After all, if the winners
compensated the losers, they would still have something left over.
The argument was misleading, because it ignored the fact that the
winners seldom, if ever, compensate the losers
. But the potential
winners spent enough money promoting the argument that it prevailed .
Globalization has had far-reaching economic and political
consequences. It has brought about some economic convergence between poor
and rich countries; but it increased inequality within both poor and rich
countries. In the developed world,
the benefits accrued mainly to
large owners of financial capital
, who constitute less than 1% of
the population. The
lack of redistributive policies is the main
source of the dissatisfaction
that democracy's opponents have
exploited. But there were other contributing factors as well,
particularly in Europe.
Therefore, the neoliberal project, considered under the aspect of
justice, was destined to implode, and known to be so destined from the very
beginning, since ultimately for popular acceptance it depends on
redistribution, but "winners seldom, if ever, compensate the losers." So why
throw good money after bad?
Now, to be fair, some more fair-minded mainstream academics are trying to
improve neoliberalism by bringing redistribution forward. First, why - after
forty years of neoliberalism - would anyone trust them? For example, a
current popular topic is the replacement of all wage work by robots. And
sometimes the topic "How to help all those poor
losers
workers"
is vaguely discussed. Are we really to believe any help will be forthcoming?
Or that, if it comes, it won't be gate-keepered and means-tested to death?
History says no. Experience says no.
Second,
neoliberalism puts markets first
. Always. So there's no reason to think
that losers will ever be compensated, because there's no market in doing
that. In any case, how do you put a price on a destroyed Main Street or a
child dead from opiates?
The neoliberal project has finally failed. It cannot secure a popular
mandate, and by its nature cannot ever secure one. Therefore, anyone
dedicated to an open society should not fund it. One might argue that
alternatives to that project should be funded, but I think (see above) that
only small-d democratic projects can create such alternatives, and they
should be self-funded.
Conclusion
I think philanthropy even on the Nineteenth Century Robber Baron model -
Carnegie Libraries, the Frick Museum, or genuine scholarship[1] - would be
preferable to continuing to fund Democrats, or neoliberal projects
generally. Soros should consider those alternatives. Short neoliberalism.[2]
Lambert Strether has been blogging, managing online communities, and
doing system administration 24/7 since 2003, in Drupal and WordPress.
Besides political economy and the political scene, he blogs about
rhetoric, software engineering, permaculture, history, literature, local
politics, international travel, food, and fixing stuff around the house.
The nom de plume "Lambert Strether" comes from Henry James's The
Ambassadors: "Live all you can. It's a mistake not to." You can follow
him on Twitter at @lambertstrether. http://www.correntewire.com
mothyGeithner
,
December 30, 2016 at 1:26 pm
I'm reminded of Dan Snyder, the owner of the football team from
Landover, Maryland.
Snyder is a guy who sold three business ventures for crazy valuations
for companies that didn't exist in any capacity a few years later or
didn't have anything beyond pizzazz. Yet, Snyder is a billionaire. Why?
What good is he? Why shouldn't the government say, "hey, we will leave
you with $25 million, but we are taking the rest."? There is no rationale
reason for billionaires to exist, so billionaires have to come up with a
reason for why their billions are justified without giving the money
away. Dan Snyder runs a football team into the ground. George Soros tries
to fight villains of his youth, Nazis and Communists under the bed before
people realize they should just get rid of billionaires.
Snyder has to run the football team because he has to prove he's worth
it and not the by product of inane Fed and tax policies that turned two
bit operations into over night IPO bonanzas. Why isn't the guy who
invented synthetic diamonds a billionaire or even a millionaire?
Wallace
: [while eating some Chicken McNuggets]
Man, these s****s is right, yo.
Malik 'Poot' Carr
: [with his mouth full] Mm-hmm.
Wallace
: Good with the hot sauce too, yo.
Malik 'Poot' Carr
: Most definitely.
Wallace
: Yo, D, you want some nuggets?
D'Angelo Barksdale
: Nah, go ahead, man.
Wallace
: Man, whoever invented these, yo, he off the
hook.
Malik 'Poot' Carr
: What?
Wallace
: Mm. M********* got the bone all the way out
the damn chicken. 'Til he came along, n****s been chewin' on
drumsticks and s***, gettin' they fingers all greasy. He said, " Later
for the bone. Let's nugget that meat up and make some real money."
Malik 'Poot' Carr
: You think the man got paid?
Wallace
: Who?
Malik 'Poot' Carr
: Man who invented these.
Wallace
: S***, he richer than a m*********.
D'Angelo Barksdale
: Why? You think he get a
percentage?
Wallace
: Why not?
D'Angelo Barksdale
: N****, please. The man who
invented them things? Just some sad-ass down at the basement at
McDonald's, thinkin' up some s*** to make some money for the real
players.
Malik 'Poot' Carr
: Naw, man, that ain't right.
D'Angelo Barksdale
: F*** "right." It ain't about
right, it's about money. Now you think Ronald McDonald gonna go down
in that basement and say, "Hey, Mista Nugget, you the bomb. We sellin'
chicken faster than you can tear the bone out. So I'm gonna write my
clowny-ass name on this fat-ass check for you"?
Wallace
: S***.
D'Angelo Barksdale
: Man, the n**** who invented them
things still workin' in the basement for regular wage, thinkin' up
some s*** to make the fries taste better or some s*** like that.
Believe.
[pause]
Wallace
: Still had the idea, though.
Everything Lambert states he is correct, but as much as Soros's money
is amplified by and mirrors NED and USAID money, it might be his job to
invest in Democrat, Neoliberal, and Regime Change projects. He seems to
function as a front/shell company like Chaz T. MAIN (Confessions of an
Economic Hitman, John Perkins) or Business International Corp. (
http://johnpilger.com/articles/power-illusion-and-americas-last-taboo
)
Soros and the State Department (or the dominant faction
thereof) have roughly the same prescription for Russia and
Eastern Europe. So no need at all to hypothesize one as a front
for the other.
Isn't he a frontman for the pretense of democracy? and the pretense
that billionaires are concerned with the working class in general
rather than a resource to be exploited and discarded?
I see Soros useful in that he feeds the myth that there are two
parties and is a pr funder marketing the myth of choice to the voters.
His words are counter to the vast majority of what he funds. I try to
focus on what people are doing not what they say.
He could personally build vast swaths of manufacturing plants and
hand them over to the workers. He could leave his wealth to a
volunteer co-op board that only grants funds to employee owned
start-ups. He could build vast swaths of non-profit public housing and
hand them over to the communities.
Also, this is not a criticism, but it looks like your argument
is for lesser evilism. Your first proposal that he stop investing
in D elections as they are losers seems merely to be a capitalist
argument that he isn't getting a return on his investment.
I'm not to sure what your second proposal of supporting small d
institions refers to maybe think tanks and media? but supporting
lower level elections is again back to the 'more and better Ds'.
I get your strategy is to take over the D party but it seems
that 'more and better Ds' that just failed to get traction with the
2016 election. Promoting that billionaires could fine tune their
influence looks like an amelioration strategy of conservatism
rather than an affirmative policy platform in opposition to the Rs.
The problem for Soros and all billionaires interested in the politics
game is that they cannot fathom voting against their own interests and they
must pick credentialed and vetted candidates. Somebody like Hillary is great
for them. For example, when she stated during the primary against Bernie
that we can't just have outright free public higher education because rich
people would benefit unfairly. That is coding to say that we won't
redistribute ill gotten gains for the purposes of building a stable and
functioning society.
> we can't just have outright free public higher education becuase
rich people would benefit unfairly
Agreed. Just a dumb excuse to persuade people we can't have nice
things. Obama may have campaigned on "Yes We Can" in 2008 but Hillary in
2016 was the soaring voice of "No, You Can't."
Especially since, in the not too distant past, we actually
had
"nice things" like tuition-free state universities but we
allowed them to be taken away from us.
Pretty clear from the rich people and a few very rich people I have
encountered, professionally and personally (once shared a secretary with
Bill Gates Sr.) that the empathy and comity and decency drivers never got
installed with the original programming.
And I "follow" Gates Jr. on Twitter, when I can stand to look in, and
what a piece of work he, or his Twavatar, is. Always on his book and on his
game. And it seems like just a game to him, from the way he plays his
position.
Now Trumpunist stars are in the ascendant. And the planet gets more heat
load, every moment of every day Too bad the looters are on the way to
"conquering death" for themselves, while "dealing death" to the rest of us
> Too bad the looters are on the way to "conquering death" for
themselves, while "dealing death" to the rest of us
I wonder what they'll do once they realize they've been had by a bunch
of grifting con artists, hardly different from themselves. When the
billionaires realize Mars is a death trap worse than Earth, will they
feel any remorse about destroying the planet? Or has the "market"
whittled that away, along with the rest of the human emotions like shame,
guilt, and compassion for their fellow man? When they realize eternal
youth and immortality isn't ever going to happen, partly because they've
hollowed out their own civilization and corrupted its science, will they
regret forcing so many others into destitution and an early grave? Maybe
for about 30 seconds, I reckon. The rest cower in self-protective
ignorance.
It's fun to look to pop culture for illustrative myths and
potentially illuminating analogies. I like "Wall-e" and "Elysium" and
"Terminator" and "Robocop" and for dessert, a big helping of "Soylent
Green "
The dillusionati always drown in their own vomit it has been that way
for the last 2 million sunsets all the technology in the world wont
change that if one can not find peace and happiness with a few million
dollars, chasing billions to spend more money 4 monets on the wall in the
hall is a losing proposition
As to georgi sore-ohs redirecting his money the klown princes will
soon be abandoning their givings with the coming removal of the estate
tax putting many non profits out of business
"non profit" hospitals will now be able to convert to for profit
dividend paying entities instead of consultant skim capital kiting
enterprises
The rober baron era existed before income taxes so I expect sow-oats
to slowly melt away now that he can hand out his remaining assets
directly and enjoy the rest of his youth with his robobabe .
Despite the best efforts of the dillusionati these past 5 – 10
thousand years once they run out of people to prey with they turn on each
other
these are weak creatures, power hungry and control crazy based on
their own fears and limitations
The bernaze sauce isnt spicy enough anymore
the rewind button on vcrs killed the soviet union and youtube and the
capacity of the average shmoe to cut, paste, edit and freeze frame has
reduced the mesmerization to a near stand still
The game is up and there is no more room left to squeeze more gold
tips on a chip no matter how much cooling one throws into the mix
The iPhone is just newton with the security state release of tech that
has been aroud for over 20 years
The programs still have bugs/features that can not be fixed based on a
unix/linux platform from over 50 years ago designed to exist in a closed
loop circuit decades of patch and pray can not be fixed by decree
one of the funders of one of the fake news "overseers"(u of penn/annanb)
runs an outfit in nyc that prices out derivatives out over 150 years from
now but all the tech can't tell me if it is going to rain or snow in 72
hours
The dillusionati are running on fumes
What is amusing is watching the panic as they fear resistance and
revolution that will never develop people just want to eat, breath and
live a reasonable life these weak dillusionati contemplate and imagine
how "they" in their weakness and fears would react but many parts of
america have already seen and lived thru an economic apocalypse
even manhattan was a dead zone on the west side when all their
shipping moved to LA and all the piers were left open and abandoned with
jokes about the only place to find nypd was at donut shops abounding
Living in the south bronx or coney island was living a real life
version of madmax
Anyhoot methinx, in respects to the original posting sore-oats just
does his freedom and democracy funding to tip the scales on his out of
the money tail risk currency options investing he just games the system
with a smile
Onto a wondrous and pleasant 2017
The fun has just begun
Less fences and more dances let 2017 be the year we talk past our
differences with our neighbors and get on with the being of being
(Damn that was long winded I thought I gave that up )
Everything Soros does is to line his own pockets I'm afraid. This
will fall on deaf ears. For them, it's never enough money. That is what this
is really about. Behind the curtains, you are dealing with a bunch of people
who care nothing about the collective good and everything about their own
net worth. Nothing else matters to them.
They'd rather watch the world burn than lose money.
Hope this isn't dinged as an
ad hominem,
but I recall that old
central European expression: "Anybody with a Hungarian for a friend doesn't
need an enemy."
Now that can be read in several ways - but always to the same end, some
allies you don't want. Soros may be a Dark Side conduit for neocon or neolib
instincts and pelf; or he may just be pissing away his own money,
a la
Snyder, just in a less benign enterprise. Neither scenario undercuts the
"bootstrap" metaphor for progressive funding. We should, therefore, be
prepared to see increased efforts to diminish "self-funding" mechanisms that
leave too much power in the hands of the little people. Not an
ad hom,
I'm not talking about Munchkins.
Soros need not be worried. Even without his money funding all these
projects, plenty of people will join him in hell afterwards. Once his Open
Ideas have been tested there, then he is welcomed to port those here, the
lesser hell.
The argument was misleading, because it ignored the fact that the
winners seldom, if ever, compensate the losers.
Yep, which is why sources of unjust wealth inequality – such as
government privileges for private credit creation – should be precluded at
their SOURCE.
In other words, ethical financing is needed to insure that increases in
productivity and wealth are justly shared.
One thing all Americans should believe in is "Thou shall not steal" –
even if by subtle means such as implicit privileges for a usury cartel.
I would argue that the U.S. hasn't been interested in democracy since, at
least, WWII. They have performed coups and assassinations and other
destabilizations in other countries (and, I would argue, here with JFK, RFK,
MLK, Jr., and who knows how many others in those "freak" small plan
accidents over the years) in favor of "friendly" dictators and tyrants.
Although Soros claims to hate Nazis and Communists, Allen Dulles was quite
partial to Nazis and made sure many of them did not face trial at Nuremberg
but instead were employed in the U.S., West Germany and other places.
If Soros wanted to put his money to good use, he could invest in getting
some transparency and cohesiveness to our election system. Had he done that
after 2000, John Kerry would have been president and probably Hillary also.
And many Dem senators, congress critters, etc. To pretend that the elections
are honest and represent the people's will has pretty much been discredited,
as far as I'm concerned.
My understanding is that Soros likes instability. It's good for his
market plays.
Call an annihilation an annihilation. Auschwitz was NOT a "resettlement
to the East". The 1931 Ukrainian Famine was NOT a "Collectivization". Using
our precious language to lie and obscure .
Despicable
There is a recording out today of Hillary Clinton talking to her
biggest donors, laying blame for her loss entirely on the shoulders
of Putin and Comey.
Let's break this down, shall we?
In the first place, she is talking to her "donors." There's your
first problem right there. Hers was always a campaign of the donors,
by the donors and for the donors. That's exactly what the American
people were turned off by. At no time did she actually talk to and
connect with them.
But more fundamentally, there was never a chance of her winning
unless she won the popular vote by MORE than 2 1/2 million. As we
have already pointed out, the last four presidential elections that
Democrats have won in the electoral college were associated with a
MINIMUM popular vote margin of about 5 million and an average of 7
million.
Let's take WI for example. The governor, lieutenant governor,
attorney general and state treasurer are all Republicans, as are 5 of
8 members of the US House, and the senators are split. By what
delusional political consultant standard is WI to be seen as an
inherently blue state? And she never set foot in WI to campaign after
the primaries.
What blue wall where?
If you win the popular vote by a minimum of 5 million, OK then
sure,
there's your blue wall, otherwise all you have is blue tissue paper.
So the day Clinton locked up the Democratic nomination, question
number one, two and three should have been, "How the hell can I, the
Democratic nominee with the highest negatives ever, win by at least 5
million in the popular vote count?"
She told her donors then that the general election was going to be
close. The general election was lost right there.
Where could all those extra votes have come from?
At that very moment we were pleading with you to rally behind an
initiative to tap Bernie Sanders for VP. The Clinton people shouted
us down. The Bernie people told us to shut up. Bernie can still win
it all they claimed, totally detached from the reality of even the
pledged delegate count.
But Bernie still got more than 13 million votes in the primaries.
There's your general election victory right there, including taking
back the Senate and bigger gains in the House.
Just as they are doing now, the Clinton's political genius dream
team
came up with the wrong answers last July. Not only have they learned
nothing, they are perversely determined to learn nothing.
Clinton had a 65% negative approval rating before Putin did a
thing.
If Comey was the big problem that should have been known on July 5th
when he called her out for being extremely careless. The "good news"
that she was not going to be indicted did not give her a big positive
bump. The tone deaf Kaine VP pick was more than 2 weeks later.
She had more than 2 weeks to come up with the answer to the
question,
"How the hell do we overcome all these negatives by a WIDE margin?"
And her answer was a corporate TPP supporter for VP?
Are you kidding us?
As unpopular as she was, Trump was only MARGINALLY more unpopular.
That was not a wide margin in her favor, and a wide margin was
mandatory. That was why she lost.
The blame list does not stop with Putin and Comey. Also this week
she
accused President Obama of not doing enough. If Obama actually
retained the power to substantially rally anyone, he would have
rallied people to demand confirmation of Merrick Garland for the
Supreme Court, and THAT would have positively impacted Hillary's
chances by highlighting Republican disrespect and obstructionism.
Some blame Bernie for not doing enough. Bernie never had the power
to
MAKE his supporters like her. By doing what . . . standing on stage
next to her more? We guarantee you she did not want him standing on
stage with her more times that he did.
But all his 13 million votes, not just a begrudging part, would
have
been hers if she had genuinely embraced him and his supporters by
putting him on the ticket too as VP in a display of unity. His
popularity, the highest of any candidate, would have rubbed off on
her big time.
The White House was hers and she threw it away to appease her
donors,
to raise an extra 100 million dollars to burn.
How are we so sure of this?
We did a private outreach to the Bernie or Bust people at the time.
What if she picks Bernie for VP, would you go for it? The answer was
not hell no. It was, we'll consider it.
That's called a yes.
And tomorrow we will talk about how to reconstruct the big tent
that
was lost by people too busy condemning people on the other side of
the tent to actually win an election.
Making money is a knack usually with some very modest intellectual input.
These guys know this and that's why once they have their big pile they start
meddling in politics using the clout ( read power ) that their billions
gives them. The politicians on the other hand know little, or nothing about
making money, but are enthralled by the billionaires . What they have in
common is that they all crave kudos to justify their position and its
maintenance. That they are a bunch of vain, self-aggrandising sociopaths is
beyond question; it's just that it took the Great Financial Crash of 2008
for most of us to realise this and that realisation has now spread to large
numbers of the populations in most of the West . So now they have a problem,
but how to deal with it they have no idea because there isn't a scintilla of
empathy in those minds of theirs. And so now we have Trump and Brexit etc.
From a Guardian article on insecure "smart Meters" put up by
Jerri-Lynn in the 12/31 Links, the humors line of the year: "The Power
[players] have to understand that with great power comes great
responsibility." Nyuk nyuk nyuk Should read, "with great power comes
great power "
democracy with a small d is a fine idea for your schools and other issues
that affect your local community. Alas, for everything else, you are living
in a complex post-agrarian society in which your very ability to eat depends
on the amorphous structure called "the economy". Which in turn depends on
central banks, trade, national policies, etc. One could deconstruct this
economy, but I somehow doubt that such deconstruction would lead to
exceptional prosperity for all. There are multiple examples of deconstructed
countries around the world, and they are not exactly an inspiration.
Soros is one of the few bright spots among billionaires, though I am sure
he is not perfect. He understands that, through generational forgetting, the
world is now facing a resurgence of fascism. He understands it better than
most, because he is one of the very few survivors of the holocaust that are
still alive. Fascism is so dangerous because, as a method of political
advancement, it works well. Appeal to emotion, particularly fear, works
better that appeal to reason. It has always been thus. You can second guess
him all you want, but you have to give this to him: he is one of the very
few left that are trying to do something to stop this wave before it plunges
the world into a sequence of wars with nukes on day one.
You would do well to join him, rather than dis him.
As far as neoliberalism goes, one should also be careful throwing this
label around indiscriminately. Human population more than doubled in my
lifetime, and all these new people are competing for resources. The US will
not escape unscathed. Governments can mitigate to some degree, but they
cannot fully stop some decline in the living standard until technologies
catch up and reduce pressures on resources. Furthermore, US relies on
imports for 50% of her oil, which also means US needs to trade and be
competitive on world markets. There are no free lunches and easy solutions
that will magically make everything better overnight. Thinking there are is
unrealistic in its own right.
Hillary Clinton, for all her faults, was a center left politician. She
was defeated by a con artist who was riding a wave of about 10-15 years
worth of fascist propaganda emanating from increasingly radicalized
Republican party. The greatest danger now is actually radicalization of the
left, as this will put the US on the path to become another South American
permanent disaster. So, when you attack those "Democratic elites", be
careful what you wish for, and be careful not to become part of the problem,
rather than part of the solution.
"Hillary Clinton, for all her faults, was a center-left politician."
Her record at State, not to mention most of the policy positions she has
supported throughout her career, is a vehement refutation of that
assertion.
We are living in the twilight of the ideologues. Whatever proves to be
practical will now prevail. Soros always had one wheel stuck in the ditch.
And Hillary, for all her experience, wound up knowing nothing. It was
amazing. Very wizard of oz. Capitalism can morph – but it can't go back. We
have all new, complex circumstances now and free marketeering in an open
society BS just hasn't got a chance of fixing things anymore. Soros should
try to understand this. So should Trump.
All I can say is, if Soros's Quantum Fund performed the way the Democrats
had the last 8 years, heads would definitely be rolling. Odd that he doesn't
demand the same accountability for his dollars when it comes to his Open
Society Foundation.
All I can say is that if Soros's fund, Quantum, delivered performance
comparable to what the Democrats had delivered over the last 8 years
electorally, heads would definitely roll and there would be no more dollars
forthcoming. Interesting that this accountability doesn't apply here.
"... But there are other flavors too. For example Trump introduced another flavor which I called "bastard neoliberalism". Which is the neoliberalism without neoliberal globalization and without "Permanent revolution" mantra -- efforts for enlargement of the US led global neoliberal empire. Somewhat similar to Eduard Bernstein "revisionism" in Marxism. Or Putinism - which is also a flavor of neoliberalism with added "strong state" part and "resource nationalism" bent, which upset so much the US neoliberal establishment, as it complicates looting of the country by transnational corporations. ..."
"... Neoliberalism also can be viewed as a modern mutation of corporatism, favoring multinationals (under disguise of "free trade"), privatization of state assets, minimal government intervention in business (with financial oligarchy being like Soviet nomenklatura above the law), reduced public expenditures on social services, and decimation of New Deal, strong anti trade unionism stance and attempt to atomize work force (perma temps as preferred mode of employment giving employers "maximum flexibility") , neocolonialism and militarism in foreign relations (might makes right). ..."
"... The word "elite" in the context of neoliberalism has the same meaning as the Russian word nomenklatura. https://en.wikipedia.org/wiki/Nomenklatura, -- the political establishment holding or controlling both public and private power centers such as media, finance, academia, culture, trade, industry, state and international institutions. ..."
At this point, when I hear people use the words "neoliberal," "elites" and "the media" in unspecified
or highly generalized terms to make broad characterizations ... I know I'm dealing with an
unserious person.
It's a lot like when someone says "structural reform" without specification in an economic
discussion: An almost perfect indicator of vacuity.
likbez -> sanjait... , -1
Let's define the terms.
Neoliberals are those who adhere to the doctrine of Neoliberalism (the "prohibited" word
you should not ever see in the US MSM ;-)
In this sense the term is very similar to Marxists (with the replacement of the slogan of
"proletarians of all nations unite" with the "financial oligarchy of all countries unite").
Or more correctly they are the "latter day Trotskyites".
Neoliberalism consists of several eclectic parts such as neoclassic economics, mixture of
Nietzscheanism (often in the form of Ann Rand philosophy; with the replacement of concept of
Ubermench with "creative class" concept)) with corporatism. Like with Marxism there are different
flavors of neoliberalism and different factions like "soft neoliberalism" (Clinton third way)
which is the modern Democratic Party doctrine, and hard neoliberalism (Republican party version),
often hostile to each other.
But there are other flavors too. For example Trump introduced another flavor which I called
"bastard neoliberalism". Which is the neoliberalism without neoliberal globalization and without
"Permanent revolution" mantra -- efforts for enlargement of the US led global neoliberal empire.
Somewhat similar to Eduard Bernstein "revisionism" in Marxism. Or Putinism - which is also
a flavor of neoliberalism with added "strong state" part and "resource nationalism" bent, which
upset so much the US neoliberal establishment, as it complicates looting of the country by
transnational corporations.
Neoliberalism also can be viewed as a modern mutation of corporatism, favoring multinationals
(under disguise of "free trade"), privatization of state assets, minimal government intervention
in business (with financial oligarchy being like Soviet nomenklatura above the law), reduced
public expenditures on social services, and decimation of New Deal, strong anti trade unionism
stance and attempt to atomize work force (perma temps as preferred mode of employment giving
employers "maximum flexibility") , neocolonialism and militarism in foreign relations (might
makes right).
Like for any corporatist thinkers the real goals are often hidden under thick smoke screen
of propaganda.
The word "elite" in the context of neoliberalism has the same meaning as the Russian word
nomenklatura. https://en.wikipedia.org/wiki/Nomenklatura,
-- the political establishment holding or controlling both public and private power centers
such as media, finance, academia, culture, trade, industry, state and international institutions.
I wonder what facts you have to label Trump's team "globalist shills".
Robert W. Merry in his National Interest article disagrees with you
http://nationalinterest.org/feature/trump-vs-hillary-nationalism-vs-globalism-2016-16041
=== start of the quote ===
Globalists captured much of American society long ago by capturing the bulk of the nation's elite
institutions -- the media, academia, big corporations, big finance, Hollywood, think tanks, NGOs,
charitable foundations. So powerful are these institutions -- in themselves and, even more so,
collectively -- that the elites running them thought that their political victories were complete
and final. That's why we have witnessed in recent years a quantum expansion of social and political
arrogance on the part of these high-flyers.
Then along comes Donald Trump and upends the whole thing. Just about every major issue that this
super-rich political neophyte has thrown at the elites turns out to be anti-globalist and pro-nationalist.
And that is the single most significant factor in his unprecedented and totally unanticipated
rise. Consider some examples:
Immigration: Nationalists believe that any true nation must have clearly delineated and protected
borders, otherwise it isn't really a nation. They also believe that their nation's cultural heritage
is sacred and needs to be protected, whereas mass immigration from far-flung lands could undermine
the national commitment to that heritage.
Globalists don't care about borders. They believe the nation-state is obsolete, a relic of
the 1648 Peace of Westphalia, which codified the recognition of co-existing nation states.
Globalists reject Westphalia in favor of an integrated world with information, money, goods
and people traversing the globe at accelerating speeds without much regard to traditional concepts
of nationhood or borders.
=== end of the quote ===
I wonder how "globalist shills" mantra correlates with the following Trump's statements:
=== start of quote ===
"Globalization has made the financial elite who donate to politicians very, very wealthy ... but
it has left millions of our workers with nothing but poverty and heartache," Trump told supporters
during a prepared speech targeting free trade in a nearly-shuttered former steel town in Pennsylvania.
In a speech devoted to what he called "How To Make America Wealthy Again," Trump offered a
series of familiar plans designed to deal with what he called [Obama] "failed trade policies"
- including rejection of the proposed Trans-Pacific Partnership (TPP) with Pacific Rim nations
and re-negotiation of the North American Free Trade Agreement (NAFTA) with Canada and Mexico,
withdrawing from it if necessary.
The presumptive Republican presidential nominee also said he would pursue bilateral trade agreements
rather than multi-national deals like TPP and NAFTA.
In addition to appointing better trade negotiators and stepping up punishment of countries
that violate trade rules, Trump's plans would also target one specific economic competitor: China.
He vowed to label China a currency manipulator, bring it before the World Trade Organization and
consider slapping tariffs on Chinese imports coming into the U.S.
"... We have a dollar democracy that protects the economic interest of the elite class while more than willing to let working class families lose their homes and jobs on the back end of wide scale mortgage fraud. Then the fraud was perpetuated in the mortgage default process just to add insult to injury. ..."
"... One thing that Trump certainly got wrong that no one ever points out is that there is a lot more murder than rape crossing the Mexican-American border in the drug cartel operations ..."
"... The technocrats lied about how globalization would be great for everyone. People's actual experience in their lives has been different. ..."
"... Centrist Democrat partisans with their increasinly ineffectual defenses of the establishment say it's only about racism and xenophobia, but it's more than that. ..."
Assaults on democracy are working because our current political elites have no idea how to
defend it.
[There are certainly good points to this article, but the basic assumption that our electorally
representative form of republican government is the ideal incarnation of the democratic value
set is obviously incorrect. We have a dollar democracy that protects the economic interest of
the elite class while more than willing to let working class families lose their homes and jobs
on the back end of wide scale mortgage fraud. Then the fraud was perpetuated in the mortgage default
process just to add insult to injury.
One thing that Trump certainly got wrong that no one ever points out is that there is a lot
more murder than rape crossing the Mexican-American border in the drug cartel operations:<) ]
The author fails to mention the Sanders campaign. An elderly socialist Jew from Brooklyn was able
to win 23 primaries and caucuses and approximately 43% of pledged delegates to Clinton's 55%.
This despite a nasty, hostile campaign against him and his supporters by the Clinton campaign
and corporate media.
There's also Jeremy Corbyn in the UK. Podemos, Syriza, etc.
Italy's 5 Star movement demonstrates a hostility to technocrats as well.
The author doesn't really focus on how the technocrats have failed.
The technocrats lied about how globalization would be great for everyone. People's actual experience
in their lives has been different.
Trump scapegoated immigrants and trade, as did Brexit, but what he really did was channel hostility
and hatred at the elites and technocrats running the country.
Centrist Democrat partisans with their increasinly ineffectual defenses of the establishment
say it's only about racism and xenophobia, but it's more than that.
RC AKA Darryl, Ron said in reply to Peter K.... , -1
"Globalization has made the financial elite who donate to politicians very, very wealthy ... but
it has left millions of our workers with nothing but poverty and heartache," Trump told supporters
during a prepared speech targeting free trade in a nearly-shuttered former steel town in Pennsylvania.
In a speech devoted to what he called "How To Make America Wealthy Again," Trump offered a series
of familiar plans designed to deal with what he called "failed trade policies" - including rejection
of the proposed Trans-Pacific Partnership (TPP) with Pacific Rim nations and re-negotiation of the
North American Free Trade Agreement (NAFTA) with Canada and Mexico, withdrawing from it if necessary.
The presumptive Republican presidential nominee also said he would pursue bilateral trade agreements
rather than multi-national deals like TPP and NAFTA.
In addition to appointing better trade negotiators and stepping up punishment of countries that violate
trade rules, Trump's plans would also target one specific economic competitor: China. He vowed to
label China a currency manipulator, bring it before the World Trade Organization and consider slapping
tariffs on Chinese imports coming into the U.S.
Fred C. Dobbs -> Peter K....
December 26, 2016 at 07:15 AM neopopulism: A cultural and political movement, mainly in Latin
American countries, distinct from twentieth-century populism in radically combining classically opposed
left-wing and right-wing attitudes and using electronic media as a means of dissemination. (Wiktionary)
"... Democratic party under Bill Clinton became yet another neoliberal party (soft neoliberals) and betrayed both organized labour and middle class in favour of financial oligarchy. ..."
"... The cynical calculation was that "they have nowhere to go" and will vote for Democrats anyway. And that was true up to and including election of "change we can believe in" guy. After this attempt of yet another Clinton-style "bait and switch" trick failed. ..."
"... Now it is clear that far right picked up large part of those votes. So in a way Bill Clinton is the godfather of the US far right renaissances. The same is true for Hillary: her "kick the can down the road" stance made victory of Trump possible (although it surprised me; I expected that neoliberals were still strong enough to push their candidate down the US people throat) ..."
"... Under "democrat" Obama the USA pursued imperial policy of creating global neoliberal empire. The foreign policy remained essentially unchanged. Neocons were partially replaced with "liberal interventionists" which is the same staff in a different bottle. This policy costs the US tremendous amount of money and it is probable that the US is going the way British empire went -- overextending itself. ..."
"... Regional currency blocks are now a reality and arrangements bypass the usage of US dollar if international trade are common. They are now in place between several large countries such as Russia and China and absolutely nothing can reverse this trend. So dollar became virtualized -- a kind of "conversion gauge" but without profits for real conversion national currency to dollars for major TBTF banks. ..."
This Washington Post article on Poland - where a right-wing, anti-intellectual, nativist party
now rules, and has garnered a lot of public support - is chilling for those of us who worry that
Trump_vs_deep_state may really be the end of the road for US democracy. The supporters of Law and Justice
clearly looked a lot like Trump's white working class enthusiasts; so are we headed down the same
path?
(In Poland, a window on what happens when
populists come to power http://wpo.st/aHJO2
Washington Post - Anthony Faiola - December 18)
Well, there's an important difference - a bit of American exceptionalism, if you like. Europe's
populist parties are actually populist; they pursue policies that really do help workers, as long
as those workers are the right color and ethnicity. As someone put it, they're selling a herrenvolk
welfare state. Law and Justice has raised minimum wages and reduced the retirement age; France's
National Front advocates the same things.
Trump, however, is different. He said lots of things on the campaign trail, but his personnel
choices indicate that in practice he's going to be a standard hard-line economic-right Republican.
His Congressional allies are revving up to dismantle Obamacare, privatize Medicare, and raise
the retirement age. His pick for Labor Secretary is a fast-food tycoon
who loathes minimum wage hikes. And his pick for top economic advisor is the king of trickle-down.
So in what sense is Trump a populist? Basically, he plays one on TV - he claims to stand for
the common man, disparages elites, trashes political correctness; but it's all for show. When
it comes to substance, he's pro-elite all the way.
It's infuriating and dismaying that he managed to get away with this in the election. But that
was all big talk. What happens when reality begins to hit? Repealing Obamacare will inflict huge
harm on precisely the people who were most enthusiastic Trump supporters - people who somehow
believed that their benefits would be left intact. What happens when they realize their mistake?
I wish I were confident in a coming moment of truth. I'm not. Given history, what we can count
on is a massive effort to spin the coming working-class devastation as somehow being the fault
of liberals, and for all I know it might work. (Think of how Britain's Tories managed to shift
blame for austerity onto Labour's mythical fiscal irresponsibility.) But there is certainly an
opportunity for Democrats coming.
And the indicated political strategy is clear: make Trump and company own all the hardship
they're about to inflict. No cooperation in devising an Obamacare replacement; no votes for Medicare
privatization and increasing the retirement age. No bipartisan cover for the end of the TV illusion
and the coming of plain old, ugly reality.
Democratic party under Bill Clinton became yet another neoliberal party (soft neoliberals)
and betrayed both organized labour and middle class in favour of financial oligarchy.
The cynical calculation was that "they have nowhere to go" and will vote for Democrats
anyway. And that was true up to and including election of "change we can believe in" guy. After
this attempt of yet another Clinton-style "bait and switch" trick failed.
Now it is clear that far right picked up large part of those votes. So in a way Bill Clinton
is the godfather of the US far right renaissances. The same is true for Hillary: her "kick the
can down the road" stance made victory of Trump possible (although it surprised me; I expected
that neoliberals were still strong enough to push their candidate down the US people throat)
Point 2:
Under "democrat" Obama the USA pursued imperial policy of creating global neoliberal empire.
The foreign policy remained essentially unchanged. Neocons were partially replaced with "liberal
interventionists" which is the same staff in a different bottle. This policy costs the US tremendous
amount of money and it is probable that the US is going the way British empire went -- overextending
itself.
Regional currency blocks are now a reality and arrangements bypass the usage of US dollar
if international trade are common. They are now in place between several large countries such
as Russia and China and absolutely nothing can reverse this trend. So dollar became virtualized
-- a kind of "conversion gauge" but without profits for real conversion national currency to dollars
for major TBTF banks.
So if we think about Iraq war as the way to prevent to use euro as alternative to dollar in
oil sales that goal was not achieved and all blood and treasure were wasted.
In this sense it would be difficult to Trump to continue with "bastard neoliberalism" both
in foreign policy and domestically and betray his election promises because they reflected real
problems facing the USA and are the cornerstone of his political support.
Also in this case neocons establishment will simply get rid of him one way or the other. I
hope that he understand this danger and will avoid trimming Social Security.
Returning to Democratic Party betrayal of interests of labour, Krugman hissy fit signifies
that he does not understand the current political situation. Neoliberal wing of Democratic Party
is now bankrupt both morally and politically. Trump election was the last nail into Bill Clinton
political legacy coffin.
Now we returned to essentially the same political process that took place after the Great Depression,
with much weaker political leaders, this time. So this is the time for stronger, more interventionist
in internal policy state and the suppression of financial oligarchy. If Trump does not understand
this he is probably doomed and will not last long.
That's why I think Trump inspired far right renaissance will continue and the political role
of military might dramatically increase. And politically Trump is the hostage of this renaissance.
Flint appointment in this sense is just the first swallow of increased role of military leaders
in government.
"... Democracy is inevitably going to clash with the demands of Globalization as they are opposite. Globalization requires entrepreneurs to search cheaper means of production worldwide. ..."
"... In practice, this means moving capital out of the USA. ..."
"... To put it in Marxist terms the interests of American society to survive and prosper came into contradiction with the interests of capitalism as a system of production and with the capitalists as a class who has no homeland, and for whom homeland is where it is easier to make money. ..."
"... American capitalism from its very beginning was based on the assumption that what was good for business was good for America. Until 1929 it more or less worked. The robber barons were robbing other entrepreneurs and workers but at least they reinvested their ill gained profits in America. The crash of 1929 showed that the interests of Big Banks clashed with the interest of American society with devastating results. ..."
"... The decades after WWII have seen a slow and steady erosion of American superiority in technology and productivity and slow and steady flight of capital from the USA. Globalization has been undermining America. From the point of view of Global prosperity if it is cheaper to produce in China, production should relocate to China. From the point of view of American worker, this is treason, a policy destroying the United States as an industrial power, as a nation, and as a community of citizens. Donald Trump is the first top ranking politician who has realized this simple fact. The vote for Donald Trump has been a protest against Globalization, immigration, open borders, capital flight, multiculturalism, liberalism and all the values American Liberal establishment has been preaching for 60 years that are killing the USA. ..."
"... Donald Trump wants to arrest the assault of Globalization on America. He promised to reduce taxes, and to attract business back to the USA. However, reduced taxes are only one ingredient in incentives. For businesses to stay or come back to the US, companies must have educated labor force, steady supply of talented, well-educated young people, excellent schools, and safe neighborhoods, among other things. As of now most of these preconditions are missing. ..."
"... Dr. Brovkin is a historian, formerly a Harvard Professor of History. He has published several books and numerous articles on Russian History and Politics. Currently, Dr. Brovkin works and lives in Marrakech, Morocco. ..."
"... This is an interesting question: is it possible to contain neoliberal globalization by building walls, rejecting 'trade' agreement, and so on. I get the feeling that a direct attack may not work. Water will find a way, as they say. With a direct attack against globalization, what you're likely to face is major capital flight. ..."
In his election campaign Donald Trump has identified several key themes that defined American malaise.
He pointed to capital flight, bad trade deals, illegal immigration, and corruption of the government
and of the press. What is missing in Trump's diagnosis though is an explanation of this crisis. What
are the causes of American decline or as Ross Pero used to say: Let's look under the hood.
Most of the challenges America faces today have to do with two processes we call Globalization
and Sovietization. By Globalization we mean a process of externalizing American business thanks to
the doctrine of Free trade which has been up to now the Gospel of the establishment. By Sovietization
we mean a process of slow expansion of the role of the government in economy, education, business,
military, press, virtually any and every aspect of politics and society.
Let us start with Globalization.
Dani Rodrick (
The Globalization Paradox: Democracy and the Future of the World Economy) has argued that
it is impossible to have democracy and globalization at the same time. Democracy is inevitably
going to clash with the demands of Globalization as they are opposite. Globalization requires entrepreneurs
to search cheaper means of production worldwide.
In practice, this means moving capital out of the USA. For fifty years economists have
been preaching Free trade, meaning that free unimpeded, no tariffs trade is good for America. And
it was in the 1950s, 60s and 1970s that American products were cheaper or better than those overseas.
Beginning with the 1970s, the process reversed. Globalization enriched the capitalists and impoverished
the rest of Americans. To put it in Marxist terms the interests of American society to survive
and prosper came into contradiction with the interests of capitalism as a system of production and
with the capitalists as a class who has no homeland, and for whom homeland is where it is easier
to make money.
American capitalism from its very beginning was based on the assumption that what was good
for business was good for America. Until 1929 it more or less worked. The robber barons were robbing
other entrepreneurs and workers but at least they reinvested their ill gained profits in America.
The crash of 1929 showed that the interests of Big Banks clashed with the interest of American society
with devastating results.
The decades after WWII have seen a slow and steady erosion of American superiority in technology
and productivity and slow and steady flight of capital from the USA. Globalization has been undermining
America. From the point of view of Global prosperity if it is cheaper to produce in China, production
should relocate to China. From the point of view of American worker, this is treason, a policy destroying
the United States as an industrial power, as a nation, and as a community of citizens. Donald Trump
is the first top ranking politician who has realized this simple fact. The vote for Donald Trump
has been a protest against Globalization, immigration, open borders, capital flight, multiculturalism,
liberalism and all the values American Liberal establishment has been preaching for 60 years that
are killing the USA.
Donald Trump wants to arrest the assault of Globalization on America. He promised to reduce
taxes, and to attract business back to the USA. However, reduced taxes are only one ingredient in
incentives. For businesses to stay or come back to the US, companies must have educated labor force,
steady supply of talented, well-educated young people, excellent schools, and safe neighborhoods,
among other things. As of now most of these preconditions are missing.
To fight Globalization Donald Trump announced in his agenda to drop or renegotiate NAFTA and TPP.
That is a step in the right direction. However, this will not be easy. There are powerful vested
interests in making money overseas that will put up great resistance to America first policy. They
have powerful lobbies and votes in the Congress and it is by far not certain if Trump will succeed
in overcoming their opposition.
Another step along these lines of fighting Globalization is the proposed building of the Wall
on Mexican border. That too may or may not work. Powerful agricultural interests in California have
a vested interest in easy and cheap labor force made up of illegal migrants. If their supply is cut
off they are going to hike up the prices on agricultural goods that may lead to inflation or higher
consumer prices for the American workers.
... ... ...
The Military: Americans are told they have a best military in the world. In fact, it is not the
best but the most expensive one in the world. According to the National priorities Project, in fiscal
2015 the military spending amounted to 54% of the discretionary spending in the
amount of 598.5 billion dollars . Of those almost 200 billion dollars goes for operations and
maintenance, 135 billion for military personnel and 90 billion for procurement (see
Here is How the US Military Spends its Billions )
American military industrial complex spends more that the next seven runners up combined. It is
a Sovietized, bureaucratic structure that exists and thrives on internal deals behind closed doors,
procurement process closed to public scrutiny, wasted funds on consultants, kickbacks, and outrageous
prices for military hardware. Specific investigations of fraud do not surface too often. Yet for
example, DoD Inspector General reported:
Why is it that an F35 fighter jet should cost 135 million apiece and the Russian SU 35 that can
do similar things is sold for 35 million dollars and produced for 15 million? The answer is that
the Congress operates on a principle that any price the military asks is good enough. The entire
system of military procurement has to be scrapped. It is a source of billions of stolen and wasted
dollars. The Pentagon budget of half a trillion a year is a drain on the economy that is unsustainable,
and what you get is not worth the money. The military industrial complex in America does not deliver
the best equipment or security it is supposed to.(on this see:
http://nationalinterest.org/blog/the-skeptics/cutting-waste-isnt-enough-curb-pentagon-spending-18640
)
Donald Trump was the first to his credit who raised the issue: Do we need all these bases overseas?
Do they really enhance American security? Or are they a waste of money for the benefit of other countries
who take America for a free ride. Why indeed should the US pay for the defense of Japan? Is Japan
a poor country that cannot afford to defend itself? Defense commitments like those expose America
to unnecessary confrontations and risk of war over issues that have nothing to do with America's
interests. Is it worth it to fight China over some uninhabitable islands that Japan claims? (See
discussion:
http://nationalinterest.org/blog/the-skeptics/should-the-us-continue-guarantee-the-security-wealthy-states-17720
)
Similarly, Trump is the first one to raise the question: What is the purpose of NATO? ( see discussion
of NATO utility:
http://nationalinterest.org/blog/the-buzz/will-president-trump-renegotiate-the-nato-treaty-18647
) Yes the Liberal pro-Clinton media answer is: to defend Europe from Russian aggression. But
really what aggression? If the Russians wanted to they could have taken Kiev in a day two years ago.
Instead, they put up with the most virulently hostile regime in Kiev. Let us ask ourselves would
we have put up with a virulently anti-American regime in Mexico, a regime that would have announced
its intention to conclude a military alliance with China or Russia? Were we not ready to go to nuclear
war over Soviet missiles in Cuba? If we would not have accepted such a regime in Mexico, why do we
complain that the Russians took action against the new regime in Ukraine. Oh yes, they took Crimea.
But the population there is Russian, and until 1954 it was Russian territory and after Ukrainian
independence the Russians did not raise the issue of Crimea as Ukrainian territory and paid rent
for their naval base there The Russians took it over only when a hostile regime clamoring for NATO
membership settled in Kiev. Does that constitute Russian aggression or actually Russian limited response
to a hostile act? (see on this Steven Cohen:
http://eastwestaccord.com/podcast-stephen-f-cohen-talks-russia-israel-middle-east-diplomacy-steele-unger/
) As I have argued elsewhere Putin has been under tremendous pressure to act more decisively
against the neo-Nazis in Kiev. (see Vlad Brovkin: On Russian Assertiveness in Foreign Policy. (
http://eastwestaccord.com/?s=brovkin&submit=Search
)
With a little bit of patience and good will a compromise is possible on Ukraine through Minsk
accords. Moreover, Ukraine is not in NATO and as long as it is not admitted to NATO, a deal with
the Russians on Ukraine is feasible. Just like so many other pro-American governments, Ukraine wants
to milk Uncle Sam for what it is worth. They expect to be paid for being anti/Russian. (See discussion
on need of enemy:
http://nationalinterest.org/feature/does-america-need-enemy-18106
) Would it not be a better policy to let Ukraine know that they are on their own: no more subsidies,
no more payments? Mend your relations with Russia yourselves. Then peace would immediately prevail.
If we admit that there is no Russian aggression and that this myth was propagated by the Neo/Cons
with the specific purpose to return to the paradigm of the cold war, i.e. more money for the military
industrial complex, if we start thinking boldly as Trump has begun, we should say to the Europeans:
go ahead, build your own European army to allay your fears of the Russians. Europe is strong enough,
rich enough and united enough to take care of its defense without American assistance. (See discussion
of Trumps agenda:
http://nationalinterest.org/feature/course-correction-18062
)
So, if Trump restructures procurement mess, reduces the number of military bases overseas, and
invests in high tech research and development for the military on the basis of real competition,
hundreds of billions of dollars could be saved and the defense capability of the country would increase.
... ... ...
Dr. Brovkin is a historian, formerly a Harvard Professor of History. He has published several
books and numerous articles on Russian History and Politics. Currently, Dr. Brovkin works and lives
in Marrakech, Morocco.
This is a bit too much, Volodya. Maybe you should've taken one subject – globalization, for
example – and stop there.
This is an interesting question: is it possible to contain neoliberal globalization by
building walls, rejecting 'trade' agreement, and so on. I get the feeling that a direct attack
may not work. Water will find a way, as they say. With a direct attack against globalization,
what you're likely to face is major capital flight.
You might be able to make neoliberal globalization work for you (for your population, that
is), like Germany and the Scandinavians do, but that's a struggle, constant struggle. And it's
a competition; it will have to be done at the expense of other nations (see Greece, Portugal,
Central (eastern) Europe). And having an anti-neoliberal president is not enough; this would require
a major change, almost a U turn, in the whole governing philosophy. Forget the sanctity of 'free
market', start worshiping the new god: national interest
What an INTERESTING article -- So much that is right, so much that is wrong. An article you
can get your teeth into.
On globalisation: pretty spot-on (although I believe he exaggerates the US weakness in what he
calls "preconditions": there are still many well educated Americans, still good neighborhoods
(yes, sure it could be a lot better). He's against NAFTA & other neoliberal Trade self indulgences.
But then we come to his concept of "Sovietization" of the US. Perhaps it's mere semantics, but
I find the concept incoherent & suspiciously adapted to deliberately agitate US conservatives.
Example: "huge sectors of American economy are not private at all, that in fact they have been
slowly taken over by an ever growing state ownership and control"
This is nonsense on its face: the government spews out trillions to private actors to provide
goods & services. It does so, in part, because it has systematically privatized every government
function capable of returning a profit. The author can't see the actor behind the mask: how much
legislation is now written by & for the benefit of private interests ? (Obama care, Bush pharmaceutical
laws ?)
Of course, the author is correct on the US military-industrial complex: it is a sump of crime
& corruption. Yet he seems not to grasp that the problem is regulative capture. How is the Fiasco
of the F35 & MacDonald Douglas merely an issue for the Legislature alone & how does this circus
resemble the Soviet Union, beyond the fact that BOTH systems (like most systems) are capable of
gross negligence & corruption ?
I like what the author says about NATO, Japan, bases etc. Although he's a little naive if he
thinks NATO for instance is about "protecting" Europe. Yes, that's a part of it: but primarily
NATO etc exist as a tool/mask behind which the US can exert it's imperial ambitions against friend
& for alike.
The author does go off against welfare well that's to be expected: sadly I don't think he quite
gets the connection between globalisation & welfare .He also legitimately goes after tertiary
education, but seems to be (again) confused as to cause & effect.
The author is completely spot on with his sovietization analogy when he comes to the US security
state. Only difference between the Soviets & the US on security totalitarianism ? The US is much
better at it (of course the US has technological advantages unimaginable to the Soviets)
• Replies:
@Randal I agree with you that it's a fascinating piece, and I also agree with many of the points
you agree with.
But then we come to his concept of "Sovietization" of the US. Perhaps it's mere semantics, but
I find the concept incoherent & suspiciously adapted to deliberately agitate US conservatives.
Example: "huge sectors of American economy are not private at all, that in fact they
have been slowly taken over by an ever growing state ownership and control"
This is nonsense on its face: the government spews out trillions to private actors to provide
goods & services. It does so, in part, because it has systematically privatized every government
function capable of returning a profit. The author can't see the actor behind the mask: how much
legislation is now written by & for the benefit of private interests ? (Obama care, Bush pharmaceutical
laws ?)
I think part of the problem here might be a mistaken focus on "the government" as an independent
actor, when in reality it is just a mechanism whereby the rulers (whether they are a dictator,
a political party or an oligarchy or whatever), and those with sufficient clout to influence them,
get things done the way they want to see them done.
As such there is really not much difference between the government directly employing the people
who do things (state socialism), and the government paying money to companies to get the same
things done. Either way, those who use the government to get things done, get to say what gets
done and how. There are differences of nuance, in terms of organizational strengths and weaknesses,
degrees of corruption and of efficiency, but fundamentally it's all big government.
A more interesting question might be - how really different are these big government variants
from the small government systems, in which the rulers pay people directly to get things done
the way they want them to be done?
An excellent article. The points that resonated the most were:
For businesses to stay or come back to the US, companies must have educated labor force,
steady supply of talented, well-educated young people, excellent schools, and safe neighborhoods,
among other things. As of now most of these preconditions are missing.
This is an enormously difficult problem that will take years to resolve, and it will need a
rethink of education from the ground up + the political will to fight the heart of Cultural Bolshevism
and the inevitable 24/7 Media assault.
Drain the swamp in Washington: ban the lobbyists, make it a crime to lobby for private interest
in a public place, restructure procurement, introduce real competition, restore capitalism,
phase out any government subsidies to Universities, force them to compete for students, force
hospitals to compete for patients. Cut cut cut expenditure everywhere possible, including welfare.
Banning lobbyists should be possible but draining the rest of the swamp looks really complicated.
Each area would need to be examined from the ground up from a value for money – efficiency viewpoint.
It doesn't matter which philosophy each one is run on – good value healthcare is desirable whichever
system produces it.
Could we have ever imagined in our worst dreams that a system of mass surveillance would
be created and perfected in the USA. (see discussion on this in: Surveillance State, in
http://www.americamagazine.org/issue/surveillance-state
This one should be easy. The Constitution guarantees a right to privacy so just shut down the
NSA. Also shut down the vast CIA mafia (it didn't exist prior to 1947) and the expensive and useless
FED (controlling the money supply isn't the business of a group of private banks – an office in
the Treasury could easily match the money supply to economic activity).
This one should be easy. The Constitution guarantees a right to privacy so just shut down the
NSA. Also shut down the vast CIA mafia (it didn't exist prior to 1947) and the expensive and useless
FED (controlling the money supply isn't the business of a group of private banks – an office in
the Treasury could easily match the money supply to economic activity).
From Unz, I have learned that the US actually has a four-part government: the "Deep State"
part which has no clear oversight from any of the other three branches.
To put it in Marxist terms the interests of American society to survive and prosper came
into contradiction with the interests of capitalism as a system of production and with the
capitalists as a class who has no homeland, and for whom homeland is where it is easier to
make money.
Another add-on contradiction, comrade, is that the selfsame capitalist class expect their host
nation to defend their interests whenever threatened abroad. This entails using the resources
derived from the masses to enforce this protection including using the little people as cannon
fodder when deemed useful.
Donald Trump is the first top ranking politician who has realized this simple fact.
Come now, do you really believe that all these politicians who have gone to these world-class
schools don't know this? They simply don't care. They're working on behalf of the .1% who are
their benefactors and who will make them rich. They did not go into politics to take vows of poverty.
They just realize the need to placate the masses with speeches written by professional speechwriters,
that's all.
Insofar as Social Security/Medicare/Medicaid goes, those are the most democratic institutions
of all. It's money spent on ourselves, internally, with money being cycled in and out at the grassroots
level. Doctors, nurses, home-care providers, etc etc, all local people get a piece of the action
unlike military spending which siphons money upwards to the upper classes.
I'd rather be employed in a government job than unemployed in the private sector. That's not
the kind of "freedom" I'm searching for comrade.
@animalogic What an INTERESTING article -- So much that is right, so much that is wrong. An
article you can get your teeth into.
On globalisation: pretty spot-on (although I believe he exaggerates the US weakness in what
he calls "preconditions": there are still many well educated Americans, still good neighborhoods
(yes, sure it could be a lot better). He's against NAFTA & other neoliberal Trade self indulgences.
But then we come to his concept of "Sovietization" of the US. Perhaps it's mere semantics, but
I find the concept... incoherent...& suspiciously adapted to deliberately agitate US conservatives.
Example: "huge sectors of American economy are not private at all, that in fact they
have been slowly taken over by an ever growing state ownership and control"
This is nonsense on its face: the government spews out trillions to private actors to provide
goods & services. It does so, in part, because it has systematically privatized every government
function capable of returning a profit. The author can't see the actor behind the mask: how much
legislation is now written by & for the benefit of private interests ? (Obama care, Bush pharmaceutical
laws ?)
Of course, the author is correct on the US military-industrial complex: it is a sump of crime
& corruption. Yet he seems not to grasp that the problem is regulative capture. How is the Fiasco
of the F35 & MacDonald Douglas merely an issue for the Legislature alone...& how does this circus
resemble the Soviet Union, beyond the fact that BOTH systems (like most systems) are capable of
gross negligence & corruption ?
I like what the author says about NATO, Japan, bases etc. Although he's a little naive if he
thinks NATO for instance is about "protecting" Europe. Yes, that's a part of it: but primarily
NATO etc exist as a tool/mask behind which the US can exert it's imperial ambitions ...against
friend & for alike.
The author does go off against welfare...well that's to be expected: sadly I don't think he quite
gets the connection between globalisation & welfare....He also legitimately goes after tertiary
education, but seems to be (again) confused as to cause & effect.
The author is completely spot on with his sovietization analogy when he comes to the US security
state. Only difference between the Soviets & the US on security totalitarianism ? The US is much
better at it (of course the US has technological advantages unimaginable to the Soviets)
I agree with you that it's a fascinating piece, and I also agree with many of the points you
agree with.
But then we come to his concept of "Sovietization" of the US. Perhaps it's mere semantics,
but I find the concept incoherent & suspiciously adapted to deliberately agitate US conservatives.
Example: "huge sectors of American economy are not private at all, that in fact they have been
slowly taken over by an ever growing state ownership and control"
This is nonsense on its face: the government spews out trillions to private actors to provide
goods & services. It does so, in part, because it has systematically privatized every government
function capable of returning a profit. The author can't see the actor behind the mask: how
much legislation is now written by & for the benefit of private interests ? (Obama care, Bush
pharmaceutical laws ?)
I think part of the problem here might be a mistaken focus on "the government" as an independent
actor, when in reality it is just a mechanism whereby the rulers (whether they are a dictator,
a political party or an oligarchy or whatever), and those with sufficient clout to influence them,
get things done the way they want to see them done.
As such there is really not much difference between the government directly employing the people
who do things (state socialism), and the government paying money to companies to get the same
things done. Either way, those who use the government to get things done, get to say what gets
done and how. There are differences of nuance, in terms of organisational strengths and weaknesses,
degrees of corruption and of efficiency, but fundamentally it's all big government.
A more interesting question might be – how really different are these big government variants
from the small government systems, in which the rulers pay people directly to get things done
the way they want them to be done?
Donald Trump won the electoral college at least in part by promising to bring coal jobs
back to Appalachia and manufacturing jobs back to the Rust Belt. Neither promise can be honored
– for the most part we're talking about jobs lost, not to unfair foreign competition, but to
technological change. But a funny thing happens when people like me try to point that out:
we get enraged responses from economists who feel an affinity for the working people of the
afflicted regions – responses that assume that trying to do the numbers must reflect contempt
for regional cultures, or something.
Is this the right narrative? I am no longer comfortable with this line:
for the most part we're talking about jobs lost, not to unfair foreign competition, but
to technological change.
Try to place that line in context with this from
Noah Smith:
Then, in the 1990s and 2000s, the U.S opened its markets to Chinese goods, first with Most
Favored Nation trading status, and then by supporting China's accession to the WTO. The resulting
competition from cheap Chinese goods contributed to vast inequality in the United States, reversing
many of the employment gains of the 1990s and holding down U.S. wages. But this sacrifice on
the part of 90% of the American populace enabled China to lift its enormous population out
of abject poverty and become a middle-income country.
Was this "fair" trade? I think not. Let me suggest this narrative: Sometime during the
Clinton Administration, it was decided that an economically strong China was good for both the
globe and the U.S. Fair enough. To enable that outcome, U.S. policy deliberately sacrificed manufacturing
workers on the theory that a.) the marginal global benefit from the job gain to a Chinese worker
exceeded the marginal global cost from a lost US manufacturing job, b.) the U.S. was shifting
toward a service sector economy anyway and needed to reposition its workforce accordingly and
c.) the transition costs of shifting workers across sectors in the U.S. were minimal.
As a consequence – and through a succession of administrations – the US tolerated implicit
subsidies of Chinese industries, including national industrial policy designed to strip production
from the US.
And then there was the currency manipulation. I am always shocked when international economists
claim "fair trade," pretending that the financial side of the international accounts is irrelevant.
As if that wasn't a big, fat thumb on the scale. Sure, "currency manipulation" is running the
other way these days. After, of course, a portion of manufacturing was absorbed overseas. After
the damage is done.
Yes, technological change is happening. But the impact, and the costs, were certainly accelerated
by U.S. policy.
It was a great plan. On paper, at least. And I would argue that in fact points a and b above
were correct.
But point c. Point c was a bad call. Point c was a disastrous call. Point c helped deliver
Donald Trump to the Oval Office. To be sure, the FBI played its role, as did the Russians. But
even allowing for the poor choice of Hilary Clinton as the Democratic nominee (the lack of contact
with rural and semi-rural voters blinded the Democrats to the deep animosity toward their candidate),
it should never have come to this.
As the opioid epidemic sweeps through rural America, an ever-greater number of drug-dependent
newborns are straining hospital neonatal units and draining precious medical resources.
The problem has grown more quickly than realized and shows no signs of abating, researchers
reported on Monday. Their study, published in JAMA Pediatrics, concludes for the first time
that the increase in drug-dependent newborns has been disproportionately larger in rural areas.
The latest causalities in the opioid epidemic are newborns.
The transition costs were not minimal.
My take is that "fair trade" as practiced since the late 1990s created another disenfranchised
class of citizens. As if we hadn't done enough of that already. Then we weaponized those newly
disenfranchised citizens with the rhetoric of identity politics. That's coming back to bite us.
We didn't really need a white nationalist movement, did we?
Now comes the big challenge: What can we do to make amends? Can we change the narrative? And
here is where I agree with Paul Krugman:
Now, if we want to have a discussion of regional policies – an argument to the effect that
my pessimism is unwarranted – fine. As someone who is generally a supporter of government activism,
I'd actually like to be convinced that a judicious program of subsidies, relocating government
departments, whatever, really can sustain communities whose traditional industry has eroded.
The damage done is largely irreversible. In medium-size regions, lower relative housing
costs may help attract overflow from the east and west coast urban areas. And maybe a program
of guaranteed jobs for small- to medium-size regions combined with relocation subsidies for very
small-size regions could help. But it won't happen overnight, if ever. And even if you could reverse
the patterns of trade – which wouldn't be easy given the intertwining of global supply chains
– the winners wouldn't be the same current losers. Tough nut to crack.
Bottom Line: I don't know how to fix this either. But I don't absolve the policy community
from their role in this disaster. I think you can easily tell a story that this was one big policy
experiment gone terribly wrong.
Vladimir Putin's Valdai Speech at the XIII Meeting (Final Plenary Session) of the Valdai International
Discussion Club (Sochi, 27 October 2016)
As is his usual custom, Russian President Vladimir Putin delivered a speech at the final session
of the annual Valdai International Discussion Club's 13th meeting, held this year in Sochi, before
an audience that included the President of Finland Tarja Halonen and former President of South Africa
Thabo Mbeki. The theme for the 2016 meeting and its discussion forums was "The Future in Progress:
Shaping the World of Tomorrow" which as Putin noted was very topical and relevant to current developments
and trends in global politics, economic and social affairs.
Putin noted that the previous year's Valdai Club discussions centred on global problems and crises,
in particular the ongoing wars in the Middle East; this fact gave him the opportunity to summarise
global political developments over the past half-century, beginning with the United States' presumption
of having won the Cold War and subsequently reshaping the international political, economic and social
order to conform to its expectations based on neoliberal capitalist assumptions. To that end, the
US and its allies across western Europe, North America and the western Pacific have co-operated in
pressing economic and political restructuring including regime change in many parts of the world:
in eastern Europe and the Balkans, in western Asia (particularly Afghanistan and Iraq) and in northern
Africa (Libya). In achieving these goals, the West has either ignored at best or at worst exploited
international political, military and economic structures, agencies and alliances to the detriment
of these institutions' reputations and credibility around the world. The West also has not hesitated
to dredge and drum up imaginary threats to the security of the world, most notably the threat of
Russian aggression and desire to recreate the Soviet Union on former Soviet territories and beyond,
the supposed Russian meddling in the US Presidential elections, and apparent Russian hacking and
leaking of emails related to failed US Presidential candidate Hillary Rodham Clinton's conduct as
US Secretary of State from 2008 to 2012.
After his observation of current world trends as they have developed since 1991, Putin queries
what kind of future we face if political elites in Washington and elsewhere focus on non-existent
problems and threats, or on problems of their own making, and ignore the very real issues and problems
affecting ordinary people everywhere: issues of stability, security and sustainable economic development.
The US alone has problems of police violence against minority groups, high levels of public and private
debt measured in trillions of dollars, failing transport infrastructure across most states, massive
unemployment that either goes undocumented or is deliberately under-reported, high prison incarceration
rates and other problems and issues indicative of a highly dysfunctional society. In societies that
are ostensibly liberal democracies where the public enjoys political freedoms, there is an ever-growing
and vast gap between what people perceive as major problems needing solutions and the political establishment's
perceptions of what the problems are, and all too often the public view and the elite view are at
polar opposites. The result is that when referenda and elections are held, predictions and assurances
of victory one way or another are smashed by actual results showing public preference for the other
way, and polling organisations, corporate media with their self-styled "pundits" and "analysts" and
governments are caught scrambling to make sense of what just happened.
Putin points out that the only way forward is for all countries to acknowledge and work together
on the problems that challenge all humans today, the resolution of which should make the world more
stable, more secure and more sustaining of human existence. Globalisation should not just benefit
a small plutocratic elite but should be demonstrated in concrete ways to benefit all. Only by adhering
to international law and legal arrangements, through the charter of the United Nations and its agencies,
can all countries hope to achieve security and stability and achieve a better future for their peoples.
To this end, the sovereignty of Middle Eastern countries like Iraq, Syria and Yemen should be
respected and the wars in those countries should be brought to an end, replaced by long-term plans
and programs of economic and social reconstruction and development. Global economic development and
progress that will reduce disparities between First World and Third World countries, eliminate notions
of "winning" and "losing", and end grinding poverty and the problems that go with it should be a
major priority. Economic co-operation should be mutually beneficial for all parties that engage in
it.
Putin also briefly mentioned in passing the development of human potential and creativity, environmental
protection and climate change, and global healthcare as important goals that all countries should
strive for.
While there's not much in Putin's speech that he hasn't said before, what he says is typical of
his worldview, the breadth and depth of his understanding of current world events (which very, very
few Western politicians can match), and his preferred approach of nations working together on common
problems and coming to solutions that benefit all and which don't advantage one party's interests
to the detriment of others and their needs. Putin's approach is a typically pragmatic and cautious
one, neutral with regards to political or economic ideology, but one focused on goals and results,
and the best way and methods to achieve those goals.
One interesting aspect of Putin's speech comes near the end where he says that only a world with
opportunities for everyone, with access to knowledge to all and many ways to realise creative potential,
can be considered truly free. Putin's understanding of freedom would appear to be very different
from what the West (and Americans in particular) understand to be "freedom", that is, being free
of restraints on one's behaviour. Putin's understanding of freedom would be closer to what 20th-century
Russian-born British philosopher Isaiah Berlin would consider to be "positive freedom", the freedom
that comes with self-mastery, being able to think and behave freely and being able to choose the
government of the society in which one lives.
The most outstanding point in Putin's speech, which unfortunately he does not elaborate on further,
given the context of the venue, is the disconnect between the political establishment and the public
in most developed countries, the role of the mass media industry in reducing or widening it, and
the dangers that this disconnect poses to societies if it continues. If elites continue to pursue
their own fantasies and lies, and neglect the needs of the public on whom they rely for support (yet
abuse by diminishing their security through offshoring jobs, weakening and eliminating worker protection,
privatising education, health and energy, and encouraging housing and other debt bubbles), the invisible
bonds of society – what might collectively be called "the social contract" between the ruler and
the ruled – will disintegrate and people may turn to violence or other extreme activities to get
what they want.
An English-language transcript of the speech can be found at
this link .
"... existing official models do not sufficiently explain the Minsky period, the runup, how things got so fragile that they could collapse so badly. ..."
"... in effect Minsky provided a model and discussion of all three stages, although his model of the Keynes stage is not really all that distinctive and is really just Keynes. ..."
"... he probably did a better job of discussing the Bagehot stage than did Bagehot, and more detailed, if less formal, than Diamond and Dybvig. ..."
"... But the essentials of what go on in a panic and crash were well understood and discussed prior to 1873, with Minsky, and Kindlegerger drawing on Minsky in his 1978 Manias, Panics, and Crashes, quoting in particular a completely modern discussion from 1848 by John Stuart Mill ..."
"... Keep in mind, there are an infinite number of models that fit the data. Science requires more that a fit. It requires that the model correspond with reality in a way that it can fill in observable data before it is observed. ..."
"... Here's a theory (not a model): the true and revolutionary insights of Veblen, Keynes, and Minsky have all failed to significantly alter the trajectory of economic thought because the discipline expects "the truth" to do the impossible. ..."
Yes, we miss the late Hy Minsky, especially those of us who knew him, although I cannot claim
to be one who knew him very well. But I knew him well enough to have experienced his wry wit and
unique perspective. Quite aside from that, it would have been great to have had him around these
last few years to comment on what has gone on, with so many invoking his name, even as they have
in the end largely ended up studiously ignoring him and relegating him back into an intellectual
dustbin of history, or tried to.
So, Paul Krugman has a post entitled "The Case of the Missing Minsky," which in turn comments
on comments by Mark Thoma on comments by Gavyn Davis on discussions at a recent IMF conference on
macroeconomic policy in light of the events of recent years, with Mark link
http://economistsview.typepad.com/economistsview/2015/06/the-case-of-the-missing-minsky.htmling
to Krugman's post.
He notes that there seem to be three periods of note:
a Minsky period of increasing vulnerability of the financial system to crash before the crash,
a Bagehot period during the crash,
a Keynes period after the crash.
Krugman argues that, despite a lot of floundering by the IMF economists, we supposedly understand
the second two, with his preferred neo-ISLM approach properly explaining the final Keynes period
of insufficiently strong recovery due to insufficiently strong aggregate demand stimulus, especially
relying on fiscal policy (and while I do not fully buy his neo-ISLM approach, I think he is mostly
right about the policy bottom line on this, as would the missing Minsky, I think).
He also says that looking at 1960s Diamond-Dybvig models of bank panics sufficiently explain the
Bagehot period, and they probably do, given the application to the shadow banking system. However,
he grants that existing official models do not sufficiently explain the Minsky period, the runup,
how things got so fragile that they could collapse so badly.
Now I do not strongly disagree with most of this, but I shall make a few further points. The first
is that in effect Minsky provided a model and discussion of all three stages, although his model
of the Keynes stage is not really all that distinctive and is really just Keynes.
But he probably did a better job of discussing the Bagehot stage than did Bagehot, and more
detailed, if less formal, than Diamond and Dybvig. I suspect that Bagehot got dragged in by
the IMF people because he is so respectable and influential regarding central bank policymaking,
given his important 1873 Lombard Street, and I am certainly not going to dismiss the importance
of that work.
But the essentials of what go on in a panic and crash were well understood and discussed prior
to 1873, with Minsky, and Kindlegerger drawing on Minsky in his 1978 Manias, Panics, and Crashes,
quoting in particular a completely modern discussion from 1848 by John Stuart Mill (I am tempted
to produce the quotation here, but it is rather long; I do so on p. 59 of my 1991 From Catastrophe
to Chaos: A General Theory of Economic Discontinuities), which clearly delineates the mechanics
and patterns of the crash, using the colorful language of "panic" and "revulsion" along the way.
Others preceding Bagehot include the inimitable MacKay in 1852 in his Madness of Crowds book
and Marx in Vol. III of Capital, although admittedly that was not published until well after
Bagehot's book.
One can even find such discussions in Cantillon early in the 1700s discussing what went on in
the Mississippi and South Sea bubbles, from which he made a lot of money, and then, good old Adam
Smith in 1776 in WoN (pp. 703-704), who in regard to the South Sea bubble and the managers of the
South Sea company declared, "They had an immense capital dividend among an immense number of proprietors.
It was naturally to be expected, therefore, that folly, negligence, and profusion should prevail
in the whole management of their affairs. The knavery and extravagance of their stock-jobbing operations
are sufficiently known [as are] the negligence, profusion and malversation of the servants of the
company."
It must be admitted that this quote from Smith does not have the sort of detailed analysis of
the crash itself that one finds in Mill or Bagehot, much less Minsky or Diamond and Dybvig. But there
is another reason of interest now to note these inflammatory remarks by Smith. David Warsh in his
Economic Principals has posted in the last few days on "Just before the lights went up," also linked
to by the
inimitable
Mark Thoma. Warsh discusses recent work on Smith's role in the bailout of the Ayr Bank of Scotland,
whose crash in 1772 created macroeconomic instability and layoffs, with Smith apparently playing
a role in getting the British parliament to bail out the bank, with its main owners, Lord Buccleuch
and the Duke of Queensbury, paying Smith off with a job as Commissioner of Customs afterwards. I
had always thought that it was ironic that free trader Smith ended his career in this position, but
had not previously known how he got it. As it is, Warsh points out that the debate over bubbles and
what the role of government should be in dealing with them was a difference between Smith and his
fellow Scottish rival, Sir James Steuart, whose earlier book provided an alternative overview of
political economy, now largely forgotten by most (An Inquiry into the Principles of Political
Oeconomy, 1767).
I conclude this by noting that part of the problem for Krugman and also the IMF crowd with Minsky
is that it is indeed hard to fit his view into a nice formal model, with various folks (including
Mark Thoma) wishing it were to be done and noting that it probably involves invoking the dread behavioral
economics that does not provide nice neat models. I also suspect that some of these folks, including
Krugman, do not like some of the purveyors of formal models based on Minsky, notably Steve Keen,
who has been very noisy in his criticism of these folks, leading even such observers as Noah Smith,
who might be open to such things, to denounce Keen for his general naughtiness and to dismiss his
work while slapping his hands. But, aside from what Keen has done, I note that there are other ways
to model the missing Minsky more formally, including using agent-based models, if one really wants
to, these do not involve putting financial frictions into DSGE models, which indeed do not successfully
model the missing Minsky.
Barkley Rosser
Update: Correction from comments is that the Ayr Bank was not bailed out. It failed. However,
the two dukes who were its main owners were effectively bailed out, see comments or the original
Warsh piece for details. It remains the case that Adam Smith helped out with that and was rewarded
with the post of Commissioner of Customs in Scotland.
What, exactly, is the value added of formal (or even informal) "models" in all this? That is to
say, if a historian were to describe the events and responses outlined above, what would he leave
out that an economist would put in?
Keep in mind, there are an infinite number of models
that fit the data. Science requires more that a fit. It requires that the model correspond with
reality in a way that it can fill in observable data before it is observed.
Meanwhile, Simon Wren-Lewis dismisses the policy-maker who listens to the historian as using
mere "intelligent guess work", strongly suggesting that economists clearly do better. But if trying
to figure out whether the current moments is Minsky, Keynes or even Keen, isn't "guesswork" then
I don't know what is. Put "intelligent guess work" policy next to model guided policy in your
history above. Where's the value added from modeling? It has to be useful AND the policy maker
must have a scientific reason for knowing it will be useful IN REAL TIME.
Krugman frequently defends "textbook" modeling with a "nobody else has come up with anything
better" response. But that's a classic "when did you stop beating your wife".
What if the economy can't be modeled? Claiming to do the impossible is deluded, even if you
can correctly say: "no one has ever improved upon my method of doing the impossible."
"But we have learned so much!" People say that, but what, exactly, are they talking about?
Here's a theory (not a model): the true and revolutionary insights of Veblen, Keynes, and
Minsky have all failed to significantly alter the trajectory of economic thought because the discipline
expects "the truth" to do the impossible.
Newton faced this when his theory of universal
Gravity was criticized for failing to explain the distance of the planets from the sun. The Aristotelian
tradition said that a proper theory of the heavens would do this.
And so Keynes has his Aristotelian interpreter Hicks and Minsky has his Keen. Requiring the
revolution to succeed in doing the impossible means that the truth gets misinterpreted or ignored.
Either way, no revolution despite every generation producing a revolutionary that sees the truth.
What is the value of this theory? If true, it explains how economics can be filled with smart
people seeking the truth and yet make zero progress in more than a century.
I get the impression that mainstream economists are generally resistant to any kind of boom-and-bust
models (at least while getting a BA in econ I was never taught any). Is this the case? It's too
bad, because models like Lotka–Volterra are not that hard. Just from messing around with agent-based
models it seems like anything with a lag or learning generates cycles. Is it because economists
are fixated on optimization and equilibrium? Are they worried about models that are too sensitive
to initial conditions?
Maybe they should not be, but the discussion among IMF economists, Davis, Thoma, and
Krugman has involved models, and in particular, conventional models. So, Krugman declares that
there are conventional models as noted above to cover two of the stages, the latter two, but not
the first one identified with Minsky. I think there are better models for all this, but they are
not the conventional ones.
chrismealy,
The DSGE and other conventional models are able to model booms and busts, although they generally
do not use the Lotka-Volterra models that such people as the late Richard Goodwin (and even Paul
Samuelson) have used for modeling business cycle dynamics. The big difference is that the conventional
models involve exogenous shocks to set off their busts, with cyclical reverberations that decay
then following the exogenous shock, with some of the lag mechanisms operating for that.
It is not really surprising that this sort of thing does not model Minsky or the Minsky moment,
which involve endogenous dynamics, the very success of the boom as during the Great Moderation
itself undermining the stability and even resilience of the system as essentially endogenous psychological
(and hence behavioral) factors operate to loosen requirements for lending and to use Minksy language,
lending and borrowing increasingly involves highly leveraged Ponzi schemes (and I note that some
more conventional economists have emphasized leverage cycles, notably John Geanakoplis, although
avoiding Minsky per se in doing so).
This is a good post and discussion so far. So here's my $.02:
1. Maybe the behaviorists like
Thaler have already explored this, but it seems to me that economists still need to learn learning
theory from psychologists. Most importantly, "bservational learning," { http://psychology.about.com/od/oindex/fl/What-Is-Observational-Learning.htm
), or more simply "monkey see, monkey do." We constantly learn by observing behavior in others:
our parents, our older siblings, the cool kids at school, our favorite pop icons, our professors,
our business mentors, and so on. As to which,
2. Some people are better at learning than others (duh!). Some learn right away, some more
slowly, some never at all. And further,
3. Some people are more persceptive than others, recognizing the importance of something earlier
or later. If you recognized how important the trend change was when Volcker broke the back of
inflation in the early 1980s, and simply bought 30 year treasuries and held them to maturity,
you made a killing. If you discovered that in the early 1990s, you made less. And so on.
All we need, to pick up on chrismealy's comment, are time periods and learning. Incorporate
variations in skill and persceptiveness into the population, and you can get a nice boom and bust
model. As more and more people, with various levels of skill, learn an economic behavior (flipping
houses, using leverage), they will "push the edge of the envelope" more and more -- does 2x leverage
work? Yes, then how about 4x? Yes, then how about 20x? -- until the system is overwhelmed.
4. But if you don't want to incorporate imitative learning models from psychology, how about
just using appraisals of short term vs. long term risk and reward. Suppose it is the 1980s, and
I think treasury yields are on a securlar downtrend. But this book called "Bankruptcy 1995" just
came out, based on a blue ribbon panel Reagan created to look at budget deficits. That best selling
book forecasts a "hockey stick" of exploding interest rates by the mid-1990s due to ever increasing
US debt. So let's say I am 50% sure of my belief that treasury yields will continue to decline
for another 20 years, and I can make 10% a year if I am right. But if I am wrong .....
Meanwhile, I calculate that there is an 80% chance I can make 10% a year for the next few years
by investing in this new publicly traded company named "Microsoft."
Even leaving aside behavioral finance theories about loss aversion, it's pretty clear that
most investors will plump for Microsoft over treasuries, given their relative confidence in short
term outcomes.
Historically, once interest rates went close to zero at the outset of the Great Depression,
they stayed there for 20 years, and then gradually rose for another 30. How confident are investors
that the same scenario will play out this time?
Either or both of the learning theory or the short term-long term risk reward scenario are
good explanations for why backwards induction ad absurdum isn't an accurate description of behavior.
----
BTW, a nice example of a failed "backwards induction" is the "taper tantrum" of 2013. Since
investors knew that the Fed was going to be raising interest rates sooner or later, they piled
on and raised interest rates immediately -- and made a nice intermediate term top at 3%.
I think New Deal Democrat has it here. This surely, can be covered with a simple model
of asynchronous adaptive expectations with stochastic (Taleb type - big tail) risks. I wouldn't
think you would even need a sophisticated agent based model. There must be plenty of ratchet type
models out there to chose from.
"...the true and revolutionary insights of Veblen, Keynes, and Minsky have all failed to significantly
alter the trajectory of economic thought because the discipline..." sacrifices to the God, Equilibrium.
New Deal Democrat,
WRT "monkey see, monkey do" see Andred Orlean's The Empire of Value which articulates
his mimetic theory of value.
Sorry, I am not on board with this at all. Sure, I am all for incorporating
learning and lags. No problem. This is good old adaptive expectations, which I have no problem
with.
The problem is back to what I said earlier, that Minsky's apparatus operates endogenously without
any need for exogenous shocks, although it can certainly operate within those, as his quoting
of Mill shows, although I did not provide that quote, but Mill starts his story of how bubbles
happen with some exogenous initial supply/demand shock in a market.
Why is what you guys talk about an exogenous shock model? Look at the example: Volcker does
something and then different people figure it out at different rates. But Volcker is the exogenous
shocker. If he does nothing, nothing happens.
In Minsky world, there does not need to be an exogenous shock. The system may be in a total
anf full equilibrium,, but that equilibrium will disequilibrate itself as psychological attitudes
and expectations endogenously change due to it. This is what the standard modelers have sush a
problem with and do not like. They have no problem wiht adaptive expectations models. This is
all old hat stuff for them, with only the fact that one does not know for sure what all those
lags are being the problem, and what opened the door to the victory of ratex because it said there
are no lags and thus no problem. Agents now what will be on average.
Warsh's history of the Ayr Bank has errors. The Bank of England offered it a "bailout" in 1772
but required the personal guarantees of the two Dukes which were not forthcoming. The Ayr Bank
struggled on without lender of last resort support until August 1773, when it closed for good.
(This is all in Clapham's history of the Bank of England.)
What Warsh is calling a "bailout" was not a bailout of the bank, but of its proprietors who
had unlimited liability and were facing the possibility of putting their estates on the market
(which would have affected land prices in Scotland).
As I understand Warsh's description, Parliament granted the two Dukes a charter for a limited
liability company that would sell annuities. It is entirely possible that contemporary sources
would describe such an action as "indemnifying" the promoters of the company. But what is meant
by this use of the term is only that Parliament authorized the formation of corporation. The actual
indemnity is provided in the event the corporation fails by the members of the public who are
creditors of the corporation.
In short, it is an error to claim that there was a "bailout" of the Ayr Bank.
I still don't understand what information is added by "models". Krugman has a job he has created
for himself where everything he does is with an eye toward policy.
So I'm a policy maker. Explain why I need a model. in the 1930s austerity caused recessions
and WWII ended the Depression. A little history of Japan's lost decade and some thinking about
the implications of fiat currency, and, voilia, Krugman's policy suggestions, with no models and
therefore no need to listen to economists like Mankiw or the Germans currently destroying Europe
(third times a charm).
By the by, I have thought this thru. The head of Duke's Philosophy Department agrees: Krugman's
method for using models is empty hand-waving. However he comes to his conclusions, it is not logically
possible that ISLM, or any other model, has anything to do with it.
http://thorntonhalldesign.com/philosophy/2014/7/1/credentialed-person-repeats-my-critique-of-krugman
Since Adam Smith economists have told rather enthralling stories about speculations, manias,
follies, frauds, and breakdowns. The audience likes this kind of stuff. However, when it comes
to how all this fits into economic theory things become a bit awkward. Of course, we have some
modls -- Minsky, Diamond-Dybvig, Keynes come to mind -- but we could also think of other modls
-- more agent-based or equilibrium with friction perhaps. On closer inspection, though, economists
have no clue at all.
Keynes messed up the basics of macro with this faulty syllogism: "Income = value of output
= consumption + investment. Saving = income - consumption. Therefore saving = investment." (1973,
p. 63)
From I=S all variants of IS-LM models are derived including Krugman's neo-ISLM which allegedly
explains the post-crash Keynes period. Let there be no ambiguity, all these models have always
been conceptually and formally defective (2011).
Minsky built upon Keynes but not on I=S.
"The simple equation 'profit equals investment' is the fundamental relation for a macroeconomics
that aims to determine the behavior through time of a capitalist economy with a sophisticated,
complex financial structure." (Minsky, 2008, p. 161)
Here profit comes in but neither Minsky, nor Keynes, nor Krugmann, nor Keen, nor the rest of
the profession can tell the fundamental difference between income and profit (2014).
The fact of the matter is that the representative economist fails to capture the essence of
the market economy. This does not matter much as long as he has models and stories about crashing
Ponzi schemes and bank panics. Yes, eventually we will miss them all -- these inimitable proto-scientific
storytellers.
To have any number of incoherent models is not such a good thing as most economists tend to
think. What is needed is the true theory.
"In order to tell the politicians and practitioners something about causes and best means,
the economist needs the true theory or else he has not much more to offer than educated common
sense or his personal opinion." (Stigum, 1991, p. 30)
The true theory of financial crises presupposes the correct profit theory which is missing
since Adam Smith. After this disqualifying performance nobody should expect that some Walrasian
or Keynesian bearer of hope will come up with the correct modl any time soon.
Egmont Kakarot-Handtke
References
Kakarot-Handtke, E. (2011). Why Post Keynesianism is Not Yet a Science. SSRN Working Paper
Series, 1966438: 1–20. URL http://ssrn.com/abstract=1966438.
Keynes, J. M. (1973). The General Theory of Employment Interest and Money. The Collected
Writings of John Maynard Keynes Vol. VII. London, Basingstoke: Macmillan.
Minsky, H. P. (2008). Stabilizing an Unstable Economy. New York, NY, Chicago, IL, San Francisco,
CA: McGraw Hill, 2nd edition.
Stigum, B. P. (1991). Toward a Formal Science of Economics: The Axiomatic Method in Economics
and Econometrics. Cambridge, MA: MIT Press.
In addition to my hypo re Volcker and interest rates, I also mention flipping
houses and leverage.
Person A flips a house, makes $100k. Person B learns of it, figures s/he can do just as well,
and flips a house. Eventually enough people are doing it that news stories are written about it.
By now 1000s of people are figuring, "if they can do it, I can do it.":
So long as the trend continues, the person using financial leverage to flip houses makes even
more profit. Person B uses more leverage, and so on. And since 2x leverage worked, why not 4x
leverage. And if that works, why not 10x leverage?
Both the number of people engaging in the behavior, and the financial leveraging of the behavior,
are endogenous, unless you are going to hang your hat on existing trend (note, not necessarily
a shock - of rising house prices0.
All you need is more and more people of various skill sets at various entry points of time
engaging in the behavior, and testing increasing leverage the more the behavior works.
Secondly, as to stability breeding instability, stability itself is the existing trend. Increasingly
over time, more and more leverage will be used to profit off the existing trend. All it takes
is learning + risk-takers successfully testing the existing limits. The more stable the system,
the more risk-takers can apply leverage without rupturing it -- for a while.
Let me try to express my position as a series of axioms:
1. Assume that no system, no matter how stable, can withstand infinite leverage.
2. Assume that there is a certain non-zero percentage of risk-taking individuals.
3. Assume that risk-takers will use some amount of leverage to attempt to profit within a stable
system.
4. Assume that risk-takers will use increasing leverage once any given lesser percentage of leverage
succeeds in rendering a profit, in order to increase profits.
5. Assume that others will learn, over various time periods, at varying levels of skill, to imitate
the successful behavior of risk-takers.
Under those circumstances, it is certain that any system,
no matter how stable, will ultimately succumb to leverage. And the more stable, the more leverage
will have been applied to reach that breaking point. I.e., stability breeds instability.
Even using history as an analogy is implicitly introducing a model. You're saying, here's my model
of this history and I crank my little model to show the behavior of the model simulates the historical
record, then I adapt the model to present circumstances, and crank again arguing, again by analogy.
What I would object to is the reliance on "analytic models" as opposed to operational
models of the actual institutions. Economists love their analytic models, particularly axiomatic
deductive "nomological machines", DSGE being the current orthodox approach. Not that there is
anything wrong about analysis. My objection would be to basing policy advice on a study of analytic
models to the exclusion of all else -- Krugman's approach -- rather than an empirical study of
institutions in operation (which would still involve models, because that's how people think,
but they might be, for example, simulation models calibrated to observed operational mechanisms).
There are reasons why economists prefer analytic models, but few of those reasons are sound.
In the end, it is a matter of bad judgment fostered by a defective education and corruption or
weakmindedness. Among other things, reliance on analytic models give economics an esoteric quality
that privileges its elite practitioners. Ordinary people can barely understand what Krugman is
talking about in the referenced piece, and that's by design. He does his bit to protect the reputations
of folks like Bernanke and Blanchard, obscuring their viewpoints and the consequences of their
policies.
I am not sure what can be done about it. Economists like Krugman are as arrogant as they are
ignorant -- there's not enough intellectual integrity to even acknowledge fundamental errors,
and that lack of integrity keeps the "orthodoxy" going in the face of manifest failures. For the
conservatives on some payroll, the problem is even worse.
I am not confident that shooing economists from the policy room and encouraging politicians
to discuss these matters among themselves improves the situation. In doubt, people fall back on
a moral fundamentalism of the kind that gets us to "austerity" and "sacrifice" and blames the
victims -- pretty much what we have now.
Re-doing Minsky as an analytic model is an impossible task almost by definition. Minsky's approach
was fundamentally about abstracting from careful observation of what financial firms did, operationally.
It made him a hero with many financial sector denizens, who recognized themselves in his narratives,
even when he cast them in the role of bad guys. (No one is ever going to recognize himself as
a representative agent in a DSGE model.)
Perhaps the hardest thing to digest from Minsky is the insight that business cycles can not
be entirely mastered. The economy is fundamentally a set of disequilibrium phenomena, the instability
built-in (endogenous, as they say). The New Keynesian idea is that the economy is fundamentally
an equilibrium phenomenon, that occasionally needs a helping hand to recover from exogenous disturbance.
These are antagonistic world views, which cannot be reconciled with each other, and the New Keynesian
view can be reconciled only minimally with the observable facts of the world, by a lot of ad hoc
fuzzy thinking ("frictions").
Bruce, I disagree with your view of politicians. The current GOP crop are essentially following
the moral philosophy that, in the end, is the only content generated by economics. But it was
not always thus.
I once watched Senator Kit Bond of Missouri (very-R) try to round up a quorum in the Small
Business Committee. It was quite clear that the man enjoyed people. He liked the company of just
about everybody. Without the strong interference from economists, that's who ends up in politics.
People like that are pragmatic. They try things. They aren't there for the purpose (contra Ted
Cruz) of breaking things.
You're right, my problem really is with analytic "models" which aren't really models but rather
metaphors or analogies. But I don't think that's the only way reasoning from history can work.
There are lots of areas of policy, some of which continue to resist conversion to economic
religion. In education policy we try interventions and see what happens. It's inductive and mostly
correlation, but thru trial and error we do progress toward better policy (although schools of
education are only slowly moving away from their notoriously anti-scientific past).
Politicians don't have to think about the budget like a household and tighten belts. They know
that business borrow money all the time. It's actually the language of the academy that leads
to "tightening belts" instead of investing in the future. Economics is the science of claiming
that if you need something, and you can afford that something, you still must consider "multipliers"
or "the philosophers stone" or some other nonsense before you can decide to buy what you need.
What I mean to say about history: don't confuse theories with models. I have a theory about what
caused what in the Great Depression. But I don't model the economy.
I think I should clarify, I think endogenous and exogenous are a little bit besides the point
here. I think the exact trigger that starts a "state change" in the system has a stochastic component.
But the increasing vulnerability of the system is endogenous, in a very Minsky sense. What I am
saying is that increasing vulnerability could be modelled without using agent based modelling
(a bit like modelling landslides or earthquakes if you like). I'm not saying that the model is
just being driven by exogenous shocks.
Bruce,
I think there is a bit of tendency to mischaracterise what Paul Krugman is saying. He is the last
person you should be accusing of mistaking the map for the territory. He is saying that EVEN relatively
simple models can make sensible suggestions about policy in some circumstances.
Yes, though I tend to agree with you that general equilibrium is the original sin in macro-economic
modelling and that the system is in fact a disequilibrium system. But that doesn't imply to me
at all that you can't use analytical approaches.
I have spent the better
part of the last 10 years working diligently to investigate and relate information on
economics and geopolitical discourse for the liberty movement. However, long before I
delved into these subjects my primary interests of study were the human mind and the
human "soul" (yes, I'm using a spiritual term).
My fascination with economics and sociopolitical events has always been rooted in the
human element.
That is to say, while economics is often treated as a
mathematical and statistical field, it is also driven by psychology.
To know
the behavior of man is to know the future of all his endeavors, good or evil.
Evil is what we are specifically here to discuss.
I have touched on
the issue in various articles in the past including
Are Globalists Evil Or Just Misunderstood
, but with extreme tensions taking shape
this year in light of the U.S. election as well as the exploding online community
investigation of "Pizzagate," I am compelled to examine it once again.
I will not be grappling with this issue from a particularly religious perspective.
Evil applies to everyone regardless of their belief system, or even their lack of
belief. Evil is secular in its influence.
The first and most important thing to understand is this - evil is NOT simply
a social or religious construct, it is an inherent element of the human psyche.
Carl Gustav Jung was one of the few psychologists in history to dare write extensively
on the issue of evil from a scientific perspective as well as a metaphysical
perspective. I highly recommend a book of his collected works on this subject titled
'Jung On Evil', edited by Murray Stein, for those who are interested in a deeper view.
To summarize, Jung found that much of the foundations of human behavior are rooted in
inborn psychological contents or "archetypes." Contrary to the position of Sigmund
Freud, Jung argued that while our environment may affect our behavior to a certain
extent, it does not make us who we are. Rather, we are born with our own individual
personality and grow into our inherent characteristics over time. Jung also found that
there are universally present elements of human psychology. That is to say, almost every
human being on the planet shares certain truths and certain natural predilections.
The concepts of good and evil, moral and immoral, are present in us from birth and
are mostly the same regardless of where we are born, what time in history we are born
and to what culture we are born. Good and evil are shared subjective experiences. It is
this observable psychological fact (among others) that leads me to believe in the idea
of a creative design - a god. Again, though, elaborating on god is beyond the scope of
this article.
To me, this should be rather comforting to people, even atheists. For if there is
observable evidence of creative design, then it would follow that there may every well
be a reason for all the trials and horrors that we experience as a species. Our lives,
our failures and our accomplishments are not random and meaningless. We are striving
toward something, whether we recognize it or not. It may be beyond our comprehension at
this time, but it is there.
Evil does not exist in a vacuum; with evil there is always good, if one looks
for it in the right places.
Most people are readily equipped to recognize evil when they see it
directly. What they are not equipped for and must learn from environment is how to
recognize evil disguised as righteousness.
The most heinous acts in
history are almost always presented as a moral obligation - a path towards some "greater
good." Inherent conscience, though, IS the greater good, and any ideology that steps
away from the boundaries of conscience will inevitably lead to disaster.
The concept of globalism is one of these ideologies that crosses the line of
conscience and pontificates to us about a "superior method" of living.
It
relies on taboo, rather than moral compass, and there is a big difference between the
two.
When we pursue a "greater good" as individuals or as a society, the means are just as
vital as the ends. The ends NEVER
justify the means. Never. For if we
abandon our core principles and commit atrocities in the name of "peace," safety or
survival, then we have forsaken the very things which make us worthy of peace and safety
and survival. A monster that devours in the name of peace is still a monster.
Globalism tells us that the collective is more important than the individual,
that the individual owes society a debt and that fealty to society in every respect is
the payment for that debt.
But inherent archetypes and conscience tell us
differently. They tell us that society is only ever as healthy as the individuals
within it, that society is only as free and vibrant as the participants. As the
individual is demeaned and enslaved, the collective crumbles into mediocrity.
Globalism also tells us that humanity's greatest potential cannot be reached without
collectivism and centralization. The assertion is that the more single-minded a society
is in its pursuits the more likely it is to effectively achieve its goals. To this end,
globalism seeks to erase all sovereignty. For now its proponents claim they only wish to
remove nations and borders from the social equation, but such collectivism never stops
there. Eventually, they will tell us that individualism represents another nefarious
"border" that prevents the group from becoming fully realized.
At the heart of collectivism is the idea that human beings are "blank
slates;" that we are born empty and are completely dependent on our environment in order
to learn what is right and wrong and how to be good people or good citizens. The
environment becomes the arbiter of decency, rather than conscience, and whoever controls
the environment, by extension, becomes god.
If the masses are convinced of this narrative then moral relativity is only a short
step away. It is the abandonment of inborn conscience that ultimately results in evil.
In my view, this is exactly why the so called "elites" are pressing for globalism in the
first place. Their end game is not just centralization of all power into a one world
edifice, but the suppression and eradication of conscience, and thus, all that is good.
To see where this leads we must look at the behaviors of the elites
themselves, which brings us to "Pizzagate."
The exposure by Wikileaks during the election cycle of what appear to be coded emails
sent between John Podesta and friends has created a burning undercurrent in the
alternative media. The emails consistently use odd and out of context "pizza"
references, and independent investigations have discovered a wide array connections
between political elites like Hillary Clinton and John Podesta to James Alefantis, the
owner of a pizza parlor in Washington D.C. called Comet Ping Pong. Alefantis, for
reasons that make little sense to me, is listed as number 49 on GQ's
Most Powerful People In Washington list
.
The assertion according to circumstantial evidence including the disturbing child and
cannibalism artwork collections of the Podestas has been that Comet Ping Pong is somehow
at the center of a child pedophilia network serving the politically connected. Both
Comet Ping Pong and a pizza establishment two doors down called Besta Pizza use symbols
in their logos and menus that are listed on the
FBI's
unclassified documentation on pedophilia symbolism
, which does not help matters.
Some of the best documentation of the Pizzagate scandal that I have seen so far has
been done by David Seaman, a former mainstream journalist gone rogue.
Here is his
YouTube page
.
I do recommend everyone at least look at the evidence he and others present. I went
into the issue rather skeptical, but was surprised by the sheer amount of weirdness and
evidence regarding Comet Pizza. There is a problem with Pizzagate that is difficult to
overcome, however; namely the fact that to my knowledge no victims have come forward.
This is not to say there has been no crime, but anyone hoping to convince the general
public of wrong-doing in this kind of scenario is going to have a very hard time without
a victim to reference.
The problem is doubly difficult now that an armed man was arrested on the premises of
Comet Ping Pong while "researching" the claims of child trafficking. Undoubtedly, the
mainstream media will declare the very investigation "dangerous conspiracy theory."
Whether this will persuade the public to ignore it, or compel them to look into it,
remains to be seen.
I fully realize the amount of confusion surrounding Pizzagate and the assertions by
some that it is a "pysop" designed to undermine the alternative media. This is a
foolish notion, in my view. The mainstream media is dying, this is unavoidable. The
alternative media is a network of sources based on the power of choice and cemented in
the concept of investigative research. The reader participates in the alternative media
by learning all available information and positions and deciding for himself what is the
most valid conclusion, if there is any conclusion to be had. The mainstream media
simply tells its readers what to think and feel based on cherry picked data.
The elites will never be able to deconstruct that kind of movement with something
like a faked "pizzagate"; rather, they would be more inclined to try to co-opt and
direct the alternative media as they do most institutions. And, if elitists are using
Pizzagate as fodder to trick the alternative media into looking ridiculous, then why
allow elitist run social media outlets like Facebook and Reddit to shut down discussion
on the issue?
The reason I am more convinced than skeptical at this stage is because this has
happened before; and in past scandals of pedophilia in Washington and other political
hotbeds, some victims DID come forward.
I would first reference the events of the Franklin Scandal between 1988 and 1991. The
Discovery Channel even produced a documentary on it complete with interviews of alleged
child victims peddled to Washington elites for the purpose of favors and blackmail.
Meant to air in 1994, the documentary was quashed before it was ever shown to the
public. The only reason it can now be found is because an original copy was released
without permission by parties unknown.
I would also reference the highly evidenced
Westminster Pedophile Ring in the U.K.
, in which the U.K. government lost or
destroyed at least 114 related files related to the investigation.
Finally, it is disconcerting to me that the criminal enterprises of former Bear
Sterns financier and convicted pedophile Jeffrey Epstein and his "Lolita Express" are
mainstream knowledge, yet the public remains largely oblivious. Bill Clinton is
shown on flight logs
to have flown on Epstein's private jet at least a 26 times; the
same jet that he used to procure child victims as young as 12 to entertain celebrities
and billionaires on his 72 acre island called "Little Saint James". The fact that
Donald Trump was also close friends with Epstein should raise some eyebrows - funny how
the mainstream media attacked Trump on every cosmetic issue under the sun but for some
reason backed away from pursuing the Epstein angle.
Where is the vast federal investigation into the people who frequented Epstein's
wretched parties? There is none, and Epstein, though convicted of molesting a 14 year
old girl and selling her into prostitution, was only slapped on the wrist with a 13
month sentence.
Accusations of pedophilia seem to follow the globalists and elitist politicians
wherever they go. This does not surprise me. They often exhibit characteristics of
narcissism and psychopathy, but their ideology of moral relativity is what would lead to
such horrible crimes.
Evil often stems from people who are empty.
When one abandons
conscience, one also in many respects abandons empathy and love. Without these elements
of our psyche there is no happiness. Without them, there is nothing left but desire and
gluttony.
Narcissists in particular are prone to use other people as forms of
entertainment and fulfillment without concern for their humanity. They can be vicious
in nature, and when taken to the level of psychopathy, they are prone to target and
abuse the most helpless of victims in order to generate a feeling of personal power.
Add in sexual addiction and aggression and narcissists become predatory in the
extreme. Nothing ever truly satisfies them. When they grow tired of the normal, they
quickly turn to the abnormal and eventually the criminal. I would say that pedophilia
is a natural progression of the elitist mindset; for children are the easiest and most
innocent victim source, not to mention the most aberrant and forbidden, and thus the
most desirable for a psychopathic deviant embracing evil impulses.
Beyond this is the even more disturbing prospect of cultism.
It is
not that the globalists are simply evil as individuals; if that were the case then they
would present far less of a threat. The greater terror is that they are also organized.
When one confronts the problem of evil head on, one quickly realizes that evil is within
us all. There will always be an internal battle in every individual. Organized evil,
though, is in fact the ultimate danger, and it is organized evil that must be
eradicated.
For organized evil to be defeated, there must be organized good.
I believe the liberty movement in particular is that good; existing in early stages,
not yet complete, but good none the less. Our championing of the non-aggression
principle and individual liberty is conducive to respect for privacy, property and
life. Conscience is a core tenet of the liberty ideal, and the exact counter to
organized elitism based on moral relativity.
Recognize and take solace that though we live in dark times, and evil men
roam free, we are also here. We are the proper response to evil, and we have been placed
here at this time for a reason. Call it fate, call it destiny, call it coincidence, call
it god, call it whatever you want, but the answer to evil is us.
"Out of the temporary evil we are now compelled to commit will emerge the
good of an unshakable rule, which will restore the regular course of the
machinery of the national life, brought to naught by liberalism. The result
justifies the means. Let us, however, in our plans, direct our attention not
so much to what is good and moral as to what is necessary and useful."
I should also point out those alledgedly behind The Protocols
are not the people the article is referring ie: those people are
typically found in any liberal establishment.
A good article, but it fails to deliver on these key aspects of
the matter:
Everyone knows from the Godfather and its genre
that there is a connection between loyalty, criminality and
power: Once you witness someone engaging in a criminal act, you
have leverage over them and that ensures their loyalty. But what
follows from that - which healthy sane minds have trouble
contemplating - is that the greater the criminality the greater
the leverage, and that because murderous paedophilia places a
person utterly beyond any prospect of redemption in decent
society, there in NO GREATER LOYALTY than those desperate to
avoid being outed. These must be the three corners of the
triangle - Power:Loyalty:Depravity through which the evil eys
views the world.
I always beleived in an Illuminati of sorts, however they
care to self identify. Until Pizzagate, I never understood that
murderous paedophilia, luciferian in style to accentuate their
own depravity, is THE KEY TO RULING THE EARTH
And another thing. If pizzagate is 'fake news' then it it
inconceivably elaborate - they'd have had to fake Epstein 2008,
Silsby 2010, Breitbart 2011, the 2013 portugese release of
podestaesque mccann suspects, as well as the current run of
wikileaks and Alefantis' instagram account - which had an avatar
photo of the 13 yr old lover of a roman emperor.
Is that much fake news a possibility? Or has this smoke been
blowing for years and we've all been too distracted to stop and
look for fire?
What floors me about the whole pizzagate thing is the evil staring us
right in the face. And then to realize that the libtards don't even
believe in evil at all, only "mental illness"!
Lesson #1: Do not waste your time figuring some things out. Things like evil
people are probably beyond a decent persons ability to understand and let's be
honest I don't want to feel any sympathy for them anyway.
Read a book years ago by Dr. Karl Menninger, a psychiatrist, titled
'Whatever happened to Sin?'
In it he talks of murder and that it is not a natural thing for man to
do,. However, when the burden of guilt is spread over many shoulders and
government condones the action, it becomes easier to bear.
When observing the results, such as soldiers returning from war, unstable
mentally, it is evident that evil has occured. It has been decades since I
read the book, so the words I wrote may not be verbatim.
Lurked ZH for years, just started reading the comments. This is worse than
Reddit's echo chamber. Bible quotes? 3 guys 1 hammer on liveleak has more
productive comments. Why not mention methods you've used to help people reach
their own conclusion about Pizzagate?
I had two slices of pizza for dinner. I had to try not to think of the poor
children walking innocently about the store who may at any moment fall victim
to a pedo. My gf said pizza places all over now need to keep a keen eye out for
the Posdesta Brothers and their Gang after all the stuff that has come out from
WikiLeaks and other sources about them.
The bible says God created evil and loosed it on us. The correct reading of
Genesis 4;1 is from the dead sea scrolls stating :
"And Adam knew his
wife Eve,
who was pregnant by Sammael [Satan]
, and she conceived and
bare Cain,
and he was like the heavenly beings, and not like earthly
beings,
and
she
said, I have gotten a man from
the angel of
the Lord."
So in Isaiah 45:7 we have this:
I form the light, and create darkness: I make peace, and create evil: I the
LORD do all these
things
.
So my research shows evil was "grafted" into humans through
the unholy alliance and 2 seedline of people resulted.
Good article but an exception: evil doesn't reside in all of us, sin does.
Evil is the expression of wanton and intentional deception, injury,
degradation, and destruction and rarely self-recognizes or admits to God as
supreme. It may be DNA encoded. Sociopathy certainly is.
But you're so
right about the organized nature of it all, and for thousands of years. The
newly formed EU didn't advertise itself as the New Babylonia for nothing on
publicty posters, heralding the coming age of one tongue out of many and
fashioning its parliament building after the Tower of Bablyon:
Secret societies are cannibalizing us, and themselves, but members won't
know till it's too late that they'll also be eaten fairly early on. Of all
"people", they should know those in the pyramid capstone won't have enough
elbow room if they let in every Tom, Dick and Harry Mason.
I am sympatico with Brandon. I have always had similar interests, about the
soul, about ethics, about human behavior.
The reality is that evil is extant
in other human beings. The thought that your property manager is going to piss
in your OJ or fuck their BFF in your bed is abhorrent to most people, but not
all. There was an article this week about a married couple that had concerns
about their rental unit manager. And what did they find? He was fucking his BFF
(yes, of course it was another dude) in their bed. The good news is they got it
on video and moved. The bad news? This kind of attitude is rampant. People
don't give a shit about other people. They think the rules don't apply to them.
That they are special. The result is renting from some asshat that fucks in
your bed or pisses in your OJ. Or parents that wonder why little Johnny or
little Janie never move out of the house and are stoned and play video games
all day.
Evil exists, in varying forms. Sadly too many people continue to make
excuses for not only bad behavior but evil behavior. I don't think that way and
I don't live my life that way but I am fully aware of all the morons stumbling
through the world that do.
I think people are misunderstanding the setup theory. Nobody believes, at
least I hope not, that all of this art and bizarre behavior on the part of
these freaks was staged for the purposes of taking down the last of our free
media, but rather, they just took advantage of a situation where they knew
people were making accusations that couldn't be sufficiently backed up or even
prosecuted, and yet caused proven or contrived damages to people. If this is
the case, their intention,
with the help of intelligence agencies
, is
to frame alt-media for starting vigilante violence and the destruction of
innocent people's lives through promoting defamation against others.
I have
no doubt that our entire system is riddled with pedophilia and likely much
worse. They have also been getting away with this forever, so when we go for
the takedown we better have our ducks in a row. To do otherwise will just give
these sickos complete immunity and more decades will pass with them continuing
to prey on our children. Not only is this at stake but the fate of all the
children of this nation is at stake if we lose our media. We are in very
dangerous and treacherous times. When you go toe to toe with the professional
trade crafters you have to play smart or they will have you every time.
Once people have had enough exposure to NPDs or psychopaths you will vibe
them after a while. I imagine this is likely the case for anyone who has
worked as a trader, finance, politics, big commodity booms are bad, etc. We
have all encountered them somewhere. People should pay attention to how they
feel (yeah I know, people hate that word) when they are around people. I have
to pretend that I don't notice them because it is so apparent to me and
immediately.
The last time I picked one out at work, a few months later the creepy
bastard walked past me at night during a -20 blizzard, with next to no
visibility, knowing that I had an hour drive, and told me in super spooky
whisper.. "Don't hit a deer on your way home now." I found out later that a
bunch of horses had mysteriously died in his care and a bunch of other things
that confirmed my suspicions. I had a long battle with him so I eventually got
to understand him pretty well. I didn't have to hear the guy state a single
sentence or watch any body language, I just knew immediately because I could
feel his malevolence and threat in my stomach where we have a large nerve
cluster. Pay attention and you will know. Also their eye contact is all wrong
and too intense.
Globalism, is designed to make you poorer slowly over decades by allowing wages
and conditions to be for ever slowly reduced under the guise of free market
competition to funnel wealth ever upwards to the 1%.
News outta Italy is also good Matteo Renzi's attempt to amend the constitution to make the
government rather than the entire legislature (both houses) powerful enough to change laws has
gone down in a screaming prang. Matteo Renzi has to resign since that is what he promised, and
just for a change the populist replacement doesn't appear to be an islamophonic fascist.
"... By Jayati Ghosh, Professor of Economics and Chairperson at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. Originally published at The Frontline ..."
"... President Obama has been a fervent supporter of both these deals, with the explicit aim of enhancing and securing US power. "We have to make sure America writes the rules of the global economy. We should do it today while our economy is in the position of global strength. We've got to harness it on our terms. If we don't write the rules for trade around the world – guess what? China will!", he famously said in a speech to workers in a Nike factory in Oregon, USA in May 2015. But even though he has made the case for the TPP plainly enough, his only chance of pushing even the TPP through is in the "lame duck" session of Congress just before the November Presidential election in the US. ..."
"... The official US version, expressed on the website of the US Trade Representative, is that the TPP "writes the rules for global trade-rules that will help increase Made-in-America exports, grow the American economy, support well-paying American jobs, and strengthen the American middle class." This is mainly supposed to occur because of the tariff cuts over 18,000 items that have been written into the agreement, which in turn are supposed to lead to significant expansion of trade volumes and values. ..."
"... But this is accepted by fewer and fewer people in the US. Across the country, workers view such trade deals with great suspicion as causing shifts in employment to lower paid workers, mostly in the Global South. ..."
"... But in fact the TPP and the TTIP are not really about trade liberalisation so much as other regulatory changes, so in any case it is hardly surprising that the positive effects on trade are likely to be so limited. What is more surprising is how the entire discussion around these agreements is still framed around the issues relating to trade liberalisation, when these are in fact the less important parts of these agreements, and it is the other elements that are likely to have more negative and even devastating effects on people living in the countries that sign up to them. ..."
"... Three aspects of these agreements are particularly worrying: the intellectual property provisions, the restrictions on regulatory practices and the investor-state dispute settlement provisions ..."
"... All of these would result in significant strengthening of the bargaining power of corporations vis-à-vis workers and citizens, would reduce the power of governments to bring in policies and regulations that affect the profits or curb the power of such corporations ..."
"... So if such features of US-led globalisation are indeed under threat, that is probably a good thing for the people of the US and for people in their trading partners who had signed up for such deals. ..."
"... The question arises: is Trump evil? Or merely awful? If Trump is merely awful, then we are not faced with voting for the Lesser Evil or otherwise voting Third Party in protest. If we are faced with a choice between Evil and Awful, perhaps a vote for Awful is a vote against Evil just by itself. ..."
"... Trump has backpedaled and frontpedaled on virtually everything, but on trade, he's got Sanders-level consistency. He's been preaching the same sanity since the 90s. https://www.youtube.com/watch?v=GZpMJeynBeg ..."
"... While I do not disagree with your comments, they must be placed in proper context: there is no substantive difference between Mike Pence and Tim Kaine, and the people who staff the campaigns of Trump and Clinton are essentially the same. (Fundamentally a replay of the 2000 election: Cheney/Bush vs. Lieberman/Gore.) ..."
"... Great Comment. Important to knock down the meme that "this is the most significant or important election of our time" - this is a carbon copy of what we have seen half a dozen times since WW2 alone and that's exactly how our elite handlers want it. Limit the choices, stoke fear, win by dividing the plebes. ..."
"... Let's face it, trade without the iron fist of capitalism will benefit us schlobs greatly and not the 1%. I'm all for being against it (TPP etc) and will vote that way. ..."
"... We'd also have put in enough puppet dictators in resource rich countries that we'd be able to get raw materials cheaply. The low labor/raw material cost will provide a significant advantage for exports but alas, our 99% won't be able to afford our own products. ..."
"... the TPP will completely outlaw any possibility of a "Buy America" clause in the future! ..."
"... The cynic in me wonders if under say NAFTA it would be possible for a multinational to sue for lost profits via isds if TPP fails to pass. That the failure to enact trade "liberalizing" legislation could be construed as an active step against trade. the way these things are so ambiguously worded, I wonder. ..."
"... Here's Obama's actual speech at the Nike headquarters (not factory). http://www.americanrhetoric.com/speeches/barackobama/barackobamatradenike.htm ..."
"... It should be noted that the Oregon Democrats who were free traitors and supported fast track authority were called out that day: Bonamici, Blumenauer, Schrader and Wyden. The only Oregon Ds that opposed: Sen. Merkley and Congressman DeFazio. ..."
"... The Market Realist is far more realistic about Oregon's free traitors' votes. http://marketrealist.com/2015/05/trans-pacific-partnership-affects-footwear-firms/ "US tariffs on footwear imported from Vietnam can range from 5% to 40%, according to OTEXA (Office of Textiles and Apparel). Ratification of the TPP will likely result in lower tariffs and higher profitability for Nike." ..."
"... So what's the incentive for Oregon's free traitors to support the TPP now? ..."
"... Perhaps they still need to show loyalty to their corporate owners and to the principle of "free trade". ..."
"... Obama: "We have to make sure America writes the rules of the global economy." ..."
"... Thank you, Mr. President, for resolving any doubts that the American project is an imperialist project! ..."
"... Yes, and I would add a jingoistic one as well. Manifest destiny, the Monroe doctrine, etc. are not just history lessons but are alive and well in the neoliberal mindset. The empire must keep expanding into every nook and cranny of the world, turning them into good consumerist slaves. ..."
"... Funny how little things change over the centuries. ..."
"... The West Is The Best, Subhuman Are All The Rest. The perpetual mantra of the Uebermensch since Columbus first made landfall. Hitler merely sought to apply the same to some Europeans. ..."
"... "How the West Came to Rule: The Geopolitical Origins of Capitalism", 2015, Alexander Anievas and Kerem Nisancioglu. ..."
"... The Dem candidate's husband made it appallingly clear what the purpose of the TPP is: "It's to make sure the future of the Asia-Pacific region is not dominated by China". ..."
"... Bill Clinton doesn't even care about "the rise of China". That's just a red herring he sets up to accuse opponents of TPP of soft-on-China treasonism. It's just fabricating a stick to beat the TPP-opponents with. Clinton's support for MFN for China shows what he really thinks about the "rise of China". ..."
"... Clinton's real motivation is the same as the TPP's real reason, to reduce America to colonial possession status of the anti-national corporations and the Global OverClass natural persons who shelter behind and within them. ..."
"... Obama. Liar or stupid? When Elizabeth Warren spoke out about the secrecy of the TPP, Obama, uncharacteristically, ran to the cameras to state that the TPP was not secret and that the charge being leveled by Warren was false. Obama's statement was that Warren had access to a copy so how dare she say it was secret. ..."
"... Obama (and Holder) effectively immunized every financial criminal involved in the great fraud and recession without bothering to run for a camera, and to this day has refused and avoided any elaboration on the subject, but he wasted no time trying to bury Warren publicly. The TPP is a continuation of Obama's give-away to corporations, or more specifically, the very important men who run them who Obama works for. And he is going to pull out all stops to deliver to the men he respects. ..."
"... It's a virtual "black market" of "money laundering" (sterilization). In foreign trade, IMPORTS decrease (-) the money stock of the importing country (and are a subtraction to domestic gDp figures), while EXPORTS increase (+) the money stock and domestic gDp (earnings repatriated to the U.S), and the potential money supply, of the exporting country. ..."
"... I don't WANT the US writing the rules of trade any longer. We know what US-written rules do: plunge worker wages into slave labor territory, guts all advanced country's manufacturing capability, sends all high tech manufacturing to 3rd world nations ..."
"... Time to toss the rules and re-write them for the greatest benefit of the greatest number of NON-wealthy and for the benefit of the planet/ecosystems, NOT for benefit of Wall St. ..."
By Jayati Ghosh, Professor of Economics and Chairperson at the Centre for Economic Studies and Planning, Jawaharlal Nehru
University, New Delhi. Originally published at
The Frontline
There is much angst in the Northern financial media about how the era of globalisation led actively by the United States may well
be coming to an end. This is said to be exemplified in the changed political attitudes to mega regional trade deals like the Trans
Pacific Partnership Agreement (TPP) that was signed (but has not yet been ratified) by the US and 11 other countries in Latin America,
Asia and Oceania; and the Trans-Atlantic Trade and Investment Partnership Agreement (TTIP) still being negotiated by the US and the
European Union.
President Obama has been a fervent supporter of both these deals, with the explicit aim of enhancing and securing US power.
"We have to make sure America writes the rules of the global economy. We should do it today while our economy is in the position
of global strength. We've got to harness it on our terms. If we don't write the rules for trade around the world – guess what? China
will!", he famously said in a speech to workers in a Nike factory in Oregon, USA in May 2015. But even though he has made the case
for the TPP plainly enough, his only chance of pushing even the TPP through is in the "lame duck" session of Congress just before
the November Presidential election in the US.
However, the changing political currents in the US are making that ever more unlikely. Hardly anyone who is a candidate in the
coming elections, whether for the Presidency, the Senate or the House of Representatives, is willing to stick their necks out to
back the deal.
Both Presidential candidates in the US (Donald Trump and Hillary Clinton) have openly come out against the TPP. In Clinton's case
this is a complete reversal of her earlier position when she had referred to the TPP as "the gold standard of trade deals" – and
it has clearly been forced upon her by the insurgent movement in the Democratic Party led by Bernie Sanders. She is already being
pushed by her rival candidate for not coming out more clearly in terms of a complete rejection of this deal. Given the significant
trust deficit that she still has to deal with across a large swathe of US voters, it will be hard if not impossible for her to backtrack
on this once again (as her husband did earlier with NAFTA) even if she does achieve the Presidency.
The official US version, expressed on the website of the US Trade Representative, is that the TPP "writes the rules for global
trade-rules that will help increase Made-in-America exports, grow the American economy, support well-paying American jobs, and strengthen
the American middle class." This is mainly supposed to occur because of the tariff cuts over 18,000 items that have been written
into the agreement, which in turn are supposed to lead to significant expansion of trade volumes and values.
But this is accepted by fewer and fewer people in the US. Across the country, workers view such trade deals with great suspicion
as causing shifts in employment to lower paid workers, mostly in the Global South. Even the only US government study of the
TPP's likely impacts, by the International Trade Commission, could project at best only 1 per cent increase in exports due to the
agreement up to 2032. A study by Jeronim Capaldo and Alex Izurieta with Jomo Kwame Sundaram ("Trading down: Unemployment, inequality
and other risks of the Trans Pacific Partnership Agreement", Working Paper 16-01, Global Development and Environment Institute, January
2016) was even less optimistic, even for the US. It found that the benefits to exports and economic growth were likely to be relatively
small for all member countries, and would be negative in the US and Japan because of losses to employment and increases in inequality.
Wage shares of national income would decline in all the member countries.
But in fact the TPP and the TTIP are not really about trade liberalisation so much as other regulatory changes, so in any
case it is hardly surprising that the positive effects on trade are likely to be so limited. What is more surprising is how the entire
discussion around these agreements is still framed around the issues relating to trade liberalisation, when these are in fact the
less important parts of these agreements, and it is the other elements that are likely to have more negative and even devastating
effects on people living in the countries that sign up to them.
Three aspects of these agreements are particularly worrying:
the intellectual property provisions,
the restrictions on regulatory practices
the investor-state dispute settlement provisions.
Three aspects of these agreements are particularly worrying: the intellectual property provisions, the restrictions
on regulatory practices and the investor-state dispute settlement provisions.
All of these would result in significant strengthening of the bargaining power of corporations vis-à-vis workers and citizens,
would reduce the power of governments to bring in policies and regulations that affect the profits or curb the power of such corporations
For example, the TPP (and the TTIP) require more stringent enforcement requirements of intellectual property rights: reducing
exemptions (e.g. allowing compulsory licensing only for emergencies); preventing parallel imports; extending IPRs to areas like life
forms, counterfeiting and piracy; extending exclusive rights to test data (e.g. in pharmaceuticals); making IPR provisions more detailed
and prescriptive. The scope of drug patents is extended to include minor changes to existing medications (a practice commonly employed
by drug companies, known as "evergreening"). Patent linkages would make it more difficult for many generic drugs to enter markets.
This would strengthen, lengthen and broaden pharmaceutical monopolies on cancer, heart disease and HIV/AIDS drugs, and in general
make even life-saving drugs more expensive and inaccessible in all the member countries. It would require further transformation
of countries' laws on patents and medical test data. It would reduce the scope of exemption in use of medical formulations through
public procurement for public purposes. All this is likely to lead to reductions in access to drugs and medical procedures because
of rising prices, and also impede innovation rather than encouraging it, across member countries.
There are also very restrictive copyright protection rules, that would also affect internet usage as Internet Service Providers
are to be forced to adhere to them. There are further restrictions on branding that would reinforce the market power of established
players.
The TPP and TTIP also contain restrictions on regulatory practices that greatly increase the power of corporations relative to
states and can even prevent states from engaging in countercyclical measures designed to boost domestic demand. It has been pointed
out by consumer groups in the USA that the powers of the Food and Drug Administration to regulate products that affect health of
citizens could be constrained and curtailed by this agreement. Similarly, macroeconomic stimulus packages that focus on boosting
domestic demand for local production would be explicitly prohibited by such agreements.
All these are matters for concern because these agreements enable corporations to litigate against governments that are perceived
to be flouting these provisions because of their own policy goals or to protect the rights of their citizens. The Investor-State
Dispute Settlement mechanism enabled by these agreements is seen to be one of their most deadly features. Such litigation is then
subject to supranational tribunals to which sovereign national courts are expected to defer, but which have no human rights safeguards
and which do not see the rights of citizen as in any way superior to the "rights" of corporations to their profits. These courts
can conduct closed and secret hearings with secret evidence. They do not just interpret the rules but contribute to them through
case law because of the relatively vague wording of the text, which can then be subject to different interpretations, and therefore
are settled by case law. The experience thus far with such tribunals has been problematic. Since they are legally based on "equal"
treatment of legal persons with no primacy for human rights, they have become known for their pro-investor bias, partly due to the
incentive structure for arbitrators, and partly because the system is designed to provide supplementary guarantees to investors,
rather than making them respect host countries laws and regulations.
If all these features of the TPP and the TTIP were more widely known, it is likely that there would be even greater public resistance
to them in the US and in other countries. Even as it is, there is growing antagonism to the trade liberalisation that is seen to
bring benefits to corporations rather than to workers, at a period in history when secure employment is seen to be the biggest prize
of all.
So if such features of US-led globalisation are indeed under threat, that is probably a good thing for the people of the US
and for people in their trading partners who had signed up for such deals.
I was watching a speech Premier Li gave at the Economic Club of NY last night, and it was interesting to see how all his (vetted,
pre-selected) questions revolved around anxieties having to do with resistance to global trade deals. Li made a few pandering
comments about how much the Chinese love American beef (stop it! you're killing me! har har) meant to diffuse those anxieties,
but it became clear that the fear among TPTB of people's dissatisfaction with the current economic is palpable. Let's keep it
up!
A federal appeals court on Tuesday threw out a $147 million civil price fixing judgment against Chinese manufacturers of
vitamin C, ruling the companies weren't liable in U.S. courts because they were acting under the direction of Chinese authorities.
The case raised thorny questions of how courts should treat foreign companies accused of violating U.S. antitrust law when
they are following mandates of a foreign government.
"I was only following orders" might not have worked in Nuremberg, but it's a-ok in international trade.
The question arises: is Trump evil? Or merely awful? If Trump is merely awful, then we are not faced with voting for the
Lesser Evil or otherwise voting Third Party in protest. If we are faced with a choice between Evil and Awful, perhaps a vote for
Awful is a vote against Evil just by itself.
Trump has already back peddaled on his TPP stance. He now says he wants to renegotiate the TTP and other trade deals. Whatever
that means. Besides, Trump is a distraction, its Mike Pence you should be keeping your eye on. He's American Taliban pure and
simple.
This is simply false. Trump has backpedaled and frontpedaled on virtually everything, but on trade, he's got Sanders-level
consistency. He's been preaching the same sanity since the 90s.
https://www.youtube.com/watch?v=GZpMJeynBeg
Hillary wants to start a war with Russia and pass the trade trifecta of TPP/TTIP/TiSA.
While I do not disagree with your comments, they must be placed in proper context: there is no substantive difference between
Mike Pence and Tim Kaine, and the people who staff the campaigns of Trump and Clinton are essentially the same. (Fundamentally
a replay of the 2000 election: Cheney/Bush vs. Lieberman/Gore.)
Trump was run to make Hillary look good, but that has turned out to be Mission Real Impossible!
We are seeing the absolute specious political theater at its worst, attempting to differentiate between Hillary Rodham Clinton
and the Trumpster – – – the only major difference is that Clinton has far more real blood on her and Bill's hands.
Nope, there is no lesser of evils this time around . . .
Great Comment. Important to knock down the meme that "this is the most significant or important election of our time" -
this is a carbon copy of what we have seen half a dozen times since WW2 alone and that's exactly how our elite handlers want it.
Limit the choices, stoke fear, win by dividing the plebes.
Let's face it, trade without the iron fist of capitalism will benefit us schlobs greatly and not the 1%. I'm all for being
against it (TPP etc) and will vote that way.
>only 1 per cent increase in exports due to the agreement up to 2032.
At that point American's wages will have dropped near enough to Chinese levels that we can compete in selling to First World
countries . assuming there are any left.
We'd also have put in enough puppet dictators in resource rich countries that we'd be able to get raw materials cheaply.
The low labor/raw material cost will provide a significant advantage for exports but alas, our 99% won't be able to afford our
own products.
Naaah, never been about competition, since nobody is actually vetted when they offshore those jobs or replace American workers
with foreign visa workers.
But to sum it up as succinctly as possible: the TPP is about the destruction of workers' rights; the destruction of local and
small businesses; and the loss of sovereignty. Few Americans are cognizant of just how many businesses are foreign owned today
in America; their local energy utility or state energy utility, their traffic enforcement company which was privatized, their
insurance company (GEICO, etc.).
I remember when a political action group back in the '00s thought they had stumbled on a big deal when someone had hacked into
the system of the Bretton Woods Committee (the lobbyist group for the international super-rich which ONLY communicates with the
Speaker of the House and the Senate Majority Leader, and who shares the same lobbyist and D.C. office space as the Group of Thirty,
the lobbyist group for the central bankers [Larry Summers, Timothy Geithner, Mario Draghi, Ernesto Zedillo, Bill Dudley, etc.,
etc.]) and placed online their demand of the senate and the congress to kill the "Buy America" clause in the federal stimulus
program of a few years back (it was watered down greatly, and many exemptions were signed by then Commerce Secretary Gary Locke),
but such information went completely unnoticed or ignored, and of course, the TPP will completely outlaw any possibility of
a "Buy America" clause in the future!
The cynic in me wonders if under say NAFTA it would be possible for a multinational to sue for lost profits via isds if
TPP fails to pass. That the failure to enact trade "liberalizing" legislation could be construed as an active step against trade.
the way these things are so ambiguously worded, I wonder.
In June 2016, "[TransCanada] filed an arbitration claim under the North American Free Trade Agreement (NAFTA) over President
Obama's rejection of the pipeline, making good on its January threat to take legal action against the US decision.
According to the official request for arbitration, the $15 billion tab is supposed to help the company recover costs and damages
that it suffered "as a result of the US administration's breach of its NAFTA obligations." NAFTA is a comprehensive trade agreement
between the United States, Canada, and Mexico that went into effect in January 1, 1994. Under the agreement, businesses can challenge
governments over investment disputes.
In addition, the company filed a suit in US Federal Court in Houston, Texas in January asserting that the Obama Administration
exceeded the power granted by the US Constitution in denying the project."
It should be noted that the Oregon Democrats who were free traitors and supported fast track authority were called out
that day: Bonamici, Blumenauer, Schrader and Wyden. The only Oregon Ds that opposed: Sen. Merkley and Congressman DeFazio.
Obama's rhetoric May 5, 2015 at the Nike campus was all about how small businesses would prosper. Congresswoman Bonamici clings
to this rationale in her refusal to tell angry constituents at town halls whether she supports the TPP.
The Market Realist is far more realistic about Oregon's free traitors' votes.
http://marketrealist.com/2015/05/trans-pacific-partnership-affects-footwear-firms/
"US tariffs on footwear imported from Vietnam can range from 5% to 40%, according to OTEXA (Office of Textiles and Apparel). Ratification
of the TPP will likely result in lower tariffs and higher profitability for Nike."
That appeals to the other big athletic corporations that cluster in the Portland metro: Columbia Sportswear and Under Armour.
Yes, and I would add a jingoistic one as well. Manifest destiny, the Monroe doctrine, etc. are not just history lessons
but are alive and well in the neoliberal mindset. The empire must keep expanding into every nook and cranny of the world, turning
them into good consumerist slaves.
Funny how little things change over the centuries.
The West Is The Best, Subhuman Are All The Rest. The perpetual mantra of the Uebermensch since Columbus first made landfall.
Hitler merely sought to apply the same to some Europeans.
"How the West Came to Rule: The Geopolitical Origins of Capitalism", 2015, Alexander Anievas and Kerem Nisancioglu.
The Dem candidate's husband made it appallingly clear what the purpose of the TPP is: "It's to make sure the future of
the Asia-Pacific region is not dominated by China".
Would be nice if they had even a passing thought for those people in a certain North American region located in between Canada
and Mexico.
Bill Clinton doesn't even care about "the rise of China". That's just a red herring he sets up to accuse opponents of TPP
of soft-on-China treasonism. It's just fabricating a stick to beat the TPP-opponents with. Clinton's support for MFN for China
shows what he really thinks about the "rise of China".
Clinton's real motivation is the same as the TPP's real reason, to reduce America to colonial possession status of the
anti-national corporations and the Global OverClass natural persons who shelter behind and within them.
If calling the International Free Trade Conspiracy "American" is enough to get it killed and destroyed, then I don't mind having
a bunch of foreigners calling the Free Trade Conspiracy "American". Just as long as they are really against it, and can really
get Free Trade killed and destroyed.
Excellent post. Thank you. Should these so called "trade agreements" be approved, perhaps Investor-State Dispute Settlement
(ISDS arbitration) futures can be created by Wall Street and made the next speculative "Play-of-the-day" so that everyone has
a chance to participate in the looting. Btw, can you loot your own house?
Obama. Liar or stupid? When Elizabeth Warren spoke out about the secrecy of the TPP, Obama, uncharacteristically, ran to
the cameras to state that the TPP was not secret and that the charge being leveled by Warren was false. Obama's statement was
that Warren had access to a copy so how dare she say it was secret.
At the time he made that statement Warren could go to an offsite location to read the TPP in the presence of a member of the
Trade Commission, could not have staff with her, could not take notes, and could not discuss anything she read with anyone else
after she left. Or face criminal charges.
Yeah. Nothing secret about that.
Obama (and Holder) effectively immunized every financial criminal involved in the great fraud and recession without bothering
to run for a camera, and to this day has refused and avoided any elaboration on the subject, but he wasted no time trying to bury
Warren publicly. The TPP is a continuation of Obama's give-away to corporations, or more specifically, the very important men
who run them who Obama works for. And he is going to pull out all stops to deliver to the men he respects.
And add to that everything from David Dayen's book (" Chain of Title ") on Covington & Burling and Eric Holder and President
Obama, and Thomas Frank's book ("Listen, Liberals") and people will have the full picture!
It's a virtual "black market" of "money laundering" (sterilization). In foreign trade, IMPORTS decrease (-) the money stock
of the importing country (and are a subtraction to domestic gDp figures), while EXPORTS increase (+) the money stock and domestic
gDp (earnings repatriated to the U.S), and the potential money supply, of the exporting country.
So, there's a financial incentive (to maximize profits), not to repatriate foreign income (pushes up our exchange rate, currency
conversion costs, if domestic re-investment alternatives are considered more circumscribed, plus taxes, etc.).
In spite of the surfeit of $s, and E-$ credits, and unlike the days in which world-trade required a Marshall Plan jump start,
trade surpluses increasingly depend on the Asian Tiger's convertibility issues.
I don't WANT the US writing the rules of trade any longer. We know what US-written rules do: plunge worker wages into slave
labor territory, guts all advanced country's manufacturing capability, sends all high tech manufacturing to 3rd world nations
or even (potential) unfriendlies like China (who can easily put trojan spyware hard code or other vulnerabilities into critical
microchips the way WE were told the US could/would when it was leading on this tech when I was serving in the 90s). We already
know that US-written rules is simply a way for mega corporations to extend patents into the ever-more-distant future, a set of
rules that hands more control of arts over to the MPAA, rules that gut environmental laws, etc. Who needs the US-written agreements
when this is the result?
Time to toss the rules and re-write them for the greatest benefit of the greatest number of NON-wealthy and for the benefit
of the planet/ecosystems, NOT for benefit of Wall St.
"... It has been an absolute failure. Brexit has torpedoed TTIP and TPP has limited value - the largest economy in the partnership, Japan, has been largely integrated in to the US for the past 70 years. ..."
"... IMO the biggest failure of the US has been hating Russia too much. The Russians have just as much reason to be afraid of China ..."
"... It's old Cold War thinking that has seen America lose its hegemony -- similar to how the British were so focused on stopping German ascendancy they didn't see the Americans coming with the knife. ..."
The US grand strategy post-Bush was to reposition itself at the heart of a liberal economic system
excluding China through TTIP with the EU and TPP with Asia-Pac ex. China and Russia. The idea
was that this would enable the US to sustain its hegemony.
It has been an absolute failure. Brexit has torpedoed TTIP and TPP has limited value -
the largest economy in the partnership, Japan, has been largely integrated in to the US for the
past 70 years.
IMO the biggest failure of the US has been hating Russia too much. The Russians have just
as much reason to be afraid of China as the US do and have a pretty capable army.
If the US patched things up with the Russians, firstly it could redeploy forces and military
effort away from the Middle East towards Asia Pac and secondly it would give the US effective
leverage over China -- with the majority of the oil producing nations aligned with the US, China
would have difficulty in conducted a sustained conflict.
It's old Cold War thinking that has seen America lose its hegemony -- similar to how the
British were so focused on stopping German ascendancy they didn't see the Americans coming with
the knife.
"... The real problem is the Chinese do not believe in economic profits, just market rates of return on invested capital which to be honest is only about 2-5% depending on risk. ..."
No one disputes the need for more official infrastructure funding
:
What we find the most interesting is that the AIIB founders didn't ask
member countries to approve an expansion of either the World Bank or the
ADB. Instead, they opted for a new organization altogether.
Why? The problem is institutional legitimacy arising from issues of power
and governance :
-- Cecchetti & Schoenholtz
[ Why? Because when all is said and done the United States wants to be
able to control the Asian Development Bank, the IMF and World Bank and use
them to in turn "control" countries that it wishes to be subject to the
US but especially to control China as the New York Times editorial board
made clear today in supporting Japanese militarism. *
No one disputes the need for more official infrastructure funding
:
-- Cecchetti & Schoenholtz
[ Unless the word "official" suffices as an excuse, of course United
States and British policy makers in particular dispute the need for more
government supported infrastructure funding. Amartya Sen and Vijay Prashad
have made this entirely clear for India. *
The real problem is the Chinese do not believe in economic profits, just
market rates of return on invested capital which to be honest is only about
2-5% depending on risk.
Americans demand monopoly profits and ROIC so high that the price of
capital assets rapidly inflates.
Thus China's high speed rail plans are evil because China is advocating
high volumes of HSR construction that costs decline by economies of scale
leading to the replacement cost of any existing rail line being lower than
original cost so the result is capital depreciation lower the price of assets,
tangible and intangible, and the frantic pace of creating jobs and building
more capital - more rail - eliminates any monopoly power of any rail system,
thereby forcing revenues down to costs with the recovery of investment cost
stretched to decades, and ROIC forced toward zero.
And it's that policy of investing to eliminate profits that drives conservatives
insane. They scream, "it is bankrupt because those hundred year lifetime
assets are not paying for themselves and generating stock market gains in
seven years!"
Its like banking was from circa 1930 to 1980! It is like utility regulation
was from 1930 to 1980! How can wealth be created when monopoly power is
thwarted?!?
Just imagine how devastating if China uses the AIIB to build a rail network
speeding goods between China and the tip of Africa and every place in between!
Highly destructive of wealth.
Though I want to smooth the writing and terminology, I completely agree.
Again, a terrific thoroughly enlightening comment. ]
anne :
And :after failing to stop the AIIB, and refusing to participate as a
founding member, the United States should join the institution as soon as it
can, participating actively in holding it to the highest 21st century standards
:.
-- Cecchetti & Schoenholtz
[ Surely the IMF and the like are responsible for the "explosive" 38 year
growth in real per capita Gross Domestic Product and 35 year growth in total
factor productivity from Mexico, neighbor to the United States, to the Philippines,
to Kenya : ]
Total Factor Productivity at Constant National Prices for China, India, Brazil
and South Africa, 1976-2011
(Indexed to 1976)
anne -> anne :
Even supposing analysts short of an Amartya Sen wish to be judicious in actually
looking to the data of the last 38 years, as even Sen has found there is a price
for arguing about the obvious importance of soft (social welfare spending) and
hard institutional infrastructure spending in China:
Real per capita Gross Domestic Product for China and Kenya, 1976-2014
(Indexed to 1976)
anne :
And :after failing to stop the AIIB, and refusing to participate
as a founding member, the United States should join the institution as soon
as it can, participating actively in holding it to the highest 21st century
standards :.
Total Factor Productivity at Constant National Prices for China,
United States and United Kingdom, 1976-2011
(Indexed to 1976)
anne :
No one disputes the need for more official infrastructure funding :
And :after failing to stop the AIIB, and refusing to participate as a
founding member, the United States should join the institution as soon as it
can, participating actively in holding it to the highest 21st century standards
:.
Total Factor Productivity at Constant National Prices for United States, United Kingdom, France, Netherlands, Germany and China,
1976-2011
(Indexed to 1976)
anne :
No one disputes the need for more official infrastructure funding :
What we find the most interesting is that the AIIB founders didn't ask member
countries to approve an expansion of either the World Bank or the ADB. Instead,
they opted for a new organization altogether.
Why? The problem is institutional legitimacy arising from issues of power
and governance :
Total Factor Productivity at Constant National Prices for China, Korea, Hong Kong and Singapore, 1976-2011
(Indexed to 1976)
anne :
No one disputes the need for more official infrastructure funding
:
And :after failing to stop the AIIB, and refusing to participate
as a founding member, the United States should join the institution as soon
as it can, participating actively in holding it to the highest 21st century
standards :.
Total Factor Productivity at Constant National Prices for Sweden,
Denmark, Norway, Finland and China, 1976-2011
(Indexed to 1976)
anne :
No one disputes the need for more official infrastructure funding
:
And :after failing to stop the AIIB, and refusing to participate
as a founding member, the United States should join the institution as soon
as it can, participating actively in holding it to the highest 21st century
standards :.
Total Factor Productivity at Constant National Prices for Ireland,
Portugal, Spain, Italy, Greece and China, 1976-2011
(Indexed to 1976)
anne :
No one disputes the need for more official infrastructure funding
:
And :after failing to stop the AIIB, and refusing to participate
as a founding member, the United States should join the institution as soon
as it can, participating actively in holding it to the highest 21st century
standards :.
Total Factor Productivity at Constant National Prices for China, Japan
and Korea, 1976-2011
(Indexed to 1976)
kthomas :
yawn
anne :
Yawn
[ When did the United States experience 38 years of 8.6% real per capita
GDP growth yearly? How about the United Kingdom? How about any other country?
I have just begun, go ahead choose another country to go with China. I am
waiting. Go ahead. I will include the astonishing total factor productivity
growth as well. ]
anne :
While most of the G20 nations, including the big European states, Australia,
and South Korea, are among the founding members, the United States, Japan,
and Canada are noticeably not :
-- Cecchetti & Schoenholtz
[ I found it startling and discouraging that Greece virtually alone in
Europe did not apply to be a founding member of the AIIB. ]
anne :
No one disputes the need for more official infrastructure funding
:
And :after failing to stop the AIIB, and refusing to participate
as a founding member, the United States should join the institution as soon
as it can, participating actively in holding it to the highest 21st century
standards :.
Total Factor Productivity at Constant National Prices for China,
United Kingdom, Australia and Canada, 1976-2011
(Indexed to 1976)
anne -> anne :
Yawn
[ I am still waiting, choose a country to go with China. ]
anne -> anne :
No one disputes the need for more official infrastructure funding
:
And :after failing to stop the AIIB, and refusing to participate
as a founding member, the United States should join the institution as soon
as it can, participating actively in holding it to the highest 21st century
standards :.
Total Factor Productivity at Constant National Prices for Indonesia,
Philippines, Thailand and China, 1976-2011
(Indexed to 1976)
anne -> anne :
Yawn
[ Still waiting, choose a country to go with China. ]
Bruce Webb :
As to why the AIIB decided to go alone (at least without the US) it may
have something to do with a fact that I stumbled on in relation to the Greece
crisis. I am sure that most people here knew the basic fact and perhaps
appreciate the irony but I didn't know whether to weep or laugh outright.
The U.S. only controls 17% of voting powers of the IMF. Why barely a
sixth! Yet any positive decision requires an 85% vote. Meaning that in operational
terms the U.S. might as well hold 51%.
You see similar things with NATO. It's a partnership that has high officers
rotating in from here or there. But which requires that the overall NATO
Commander be an American.
Nothing undemocratic or hegemonic here! Nope! Moving right along!
anne -> Bruce Webb :
The U.S. only controls 17% of voting powers of the IMF. Why barely a
sixth! Yet any positive decision requires an 85% vote. Meaning that in operational
terms the U.S. might as well hold 51%.
You see similar things with NATO. It's a partnership that has high officers
rotating in from here or there. But which requires that the overall NATO
Commander be an American.
Nothing undemocratic or hegemonic here! Nope! Moving right along!
[ Perfect and important. ]
anne -> Bruce Webb :
I am sure that most people here knew the basic fact and perhaps appreciate
the irony but I didn't know whether to weep or laugh outright :.
[ No, in continually whining about the need for Asian Infrastructure
Investment Bank to be transparent and democratic the United States was making
sure never ever to explain the historic lack of transparency and anti-democratic
nature of the IMF and World Bank and Asian Development Bank. ]
"... Bill Clinton: "The geopolitical reasons for [TPP], from America's point of view, are pretty clear. It's designed to make sure that the future of the Asia-Pacific region, economically, is not totally dominated by China" ..."
"... " The full 40-page paper (PDF) [from the Global Development And Environment Institute at Tufts University] goes into the details [of projected economic gains from trade deals]. Along the way, it provides a highly critical analysis of the underlying econometric model used for almost all of the official studies of CETA, TPP and TTIP - the so-called "computable general equilibrium" (CGE) approach. In particular, the authors find that using the CGE model to analyze a potential trade deal effectively guarantees that there will be a positive outcome ("net welfare gains") because of its unrealistic assumptions" [ TechDirt ]. ..."
Bill Clinton: "The geopolitical reasons for [TPP], from America's point of view, are pretty
clear. It's designed to make sure that the future of the Asia-Pacific region, economically, is not
totally dominated by China" [
CNBC ].
"However, he stopped short [by about an inch, right?] of supporting the TPP. He added that his
wife [who is running for President' has said provisions on currency manipulation must be enforced
and measures put in place in the United States to address any labor market dislocations that result
from trade deals." Oh. "Provisions enforced" sounds like executive authority, to me. And "measures
put in place" sounds like a side deal. In other words, Bill Clinton just floated Hillary's trial
balloon for passing TPP, if Obama can't get it done in the lame duck. Of course, if you parsed her
words, you knew she wasn't lying , exactly .
" The full 40-page
paper (PDF) [from the Global Development And Environment Institute at Tufts University] goes
into the details [of projected economic gains from trade deals]. Along the way, it provides a highly
critical analysis of the underlying econometric model used for almost all of the official studies
of CETA, TPP and TTIP - the so-called "computable general equilibrium" (CGE) approach. In particular,
the authors find that using the CGE model to analyze a potential trade deal effectively guarantees
that there will be a positive outcome ("net welfare gains") because of its unrealistic assumptions"
[
TechDirt ].
"Conservative lawmakers looking for a way to buck Donald Trump's populist message on trade may
have gotten a little more cover with more than 30 conservative and libertarian groups sending a letter
today to Congress expressing strong support for free trade" [
Politico ]. National
Taxpayers Union, Club for Growth, FreedomWorks
"France is set to arrive at the meeting with a proposal to suspend TTIP negotiations, our Pro
Trade colleagues in Brussels report. But for the deal's supporters, there's hop'e: 'France will not
win the day,' Alberto Mucci, Christian Oliver and Hans von der Burchard write. 'Britain [???], Italy,
Spain, Poland, the Nordic countries and the Baltics will thwart any attempt to end the Transatlantic
Trade and Investment Partnership in Bratislava'" [
Politico ].
"... Expressing his overall objections to the TPP, Stiglitz said "corporate interests... were at the table" when it was being crafted. He also condemned "the provisions on intellectual property that will drive up drug prices" and "the 'investment provisions' which will make it more difficult to regulate and actually harm trade." ..."
"... The Democratic candidate, for her part, supported the deal before coming out against it , but for TPP foes, uncertainty about her position remains, especially since she recently named former Colorado Senator and Interior Secretary-and " vehement advocate for the TPP "-Ken Salazar to be chair of her presidential transition team. ..."
"... Rep. Debbie Dingell (D-Mich.) said , "We have to make sure that bill never sees the light of day after this election," while Rep. Alan Grayson (D-Fla.) said at the American Postal Workers Union convention in Walt Disney World, "If this goes through, it's curtains for the middle class in this country." ..."
Nobel Prize-winning economist Joseph Stiglitz has reiterated his opposition
to the Trans Pacific
Partnership (TPP), saying on Tuesday that President Barack Obama's push
to get the trade deal passed during the upcoming lame-duck session of Congress
is "outrageous" and "absolutely wrong."
Stiglitz, an economics professor at
Columbia University and chief economist of the Roosevelt Institute,
made the comments on CNN's "Quest Means Business."
His criticism comes as Obama aggressively
campaigns to get lawmakers to pass the TPP in the Nov. 9 to Jan. 3 window-even
as
resistance mounts against the 12-nation deal.
Echoing an
argument made by Center for Economic
and Policy Research co-director Mark Weisbrot, Stiglitz said, "At the lame-duck
session you have congressmen voting who know that they're not accountable anymore."
Lawmakers "who are not politically accountable because they're leaving may,
in response to promises of jobs or just subtle understandings, do things that
are not in the national interest," he said.
Expressing his overall objections to the TPP, Stiglitz said "corporate
interests... were at the table" when it was being crafted. He also condemned
"the provisions on intellectual property that will drive up drug prices" and
"the 'investment provisions' which will make it more difficult to regulate and
actually harm trade."
"The advocates of trade said it was going to benefit everyone,"
he added. "The evidence is it's benefited a few and left a lot behind."
Stiglitz has also been advising the
Hillary
Clinton presidential campaign. The Democratic candidate, for her part,
supported the deal before coming out
against it, but for TPP foes, uncertainty about her position remains, especially
since she recently
named former Colorado Senator and Interior Secretary-and "vehement
advocate for the TPP"-Ken Salazar to be chair of her presidential transition
team.
Opposition to the TPP also appeared Tuesday in Michigan and Florida, where
union members and lawmakers criticized what they foresee as the deal's impacts
on working families.
Rep. Debbie Dingell (D-Mich.)
said, "We have to make sure that bill never sees the light of day after
this election," while Rep. Alan Grayson (D-Fla.)
said at the American Postal Workers Union convention in Walt Disney World,
"If this goes through, it's curtains for the middle class in this country."
We cannot allow this agreement to forsake the American middle class, while foreign governments
are allowed to devalue their currency and artificially prop-up their industries.
The Trans-Pacific Partnership trade deal is a bad deal for the American people. This historically
massive trade deal -- accounting for 40 percent of global trade -- would reduce restrictions on foreign
corporations operating within the U.S., limit our ability to protect our environment, and create
more incentives for U.S. businesses to outsource investments and jobs overseas to countries with
lower labor costs and standards.
Over and over we hear from TPP proponents how the TPP will boost our economy, help American workers,
and set the standards for global trade. The International Trade Commission report released last May
(https://www.usitc.gov/publications/332/pub4607.pdf)
confirms that the opposite is true. In exchange for just 0.15 percent boost in GDP by 2032, the TPP
would decimate American manufacturing capacity, increase our trade deficit, ship American jobs overseas,
and result in losses to 16 of the 25 U.S. economic sectors. These estimates don't even account for
the damaging effects of currency manipulation, environmental impacts, and the agreement's deeply
flawed Investor State Dispute Settlement (ISDS) process.
There's no reason to believe the provisions of this deal relating to labor standards, preserving
American jobs, or protecting our environment, will be enforceable. Every trade agreement negotiated
in the past claimed to have strong enforceable provisions to protect American jobs -- yet no such
enforcement has occurred, and agreements like the North American Free Trade Agreement (NAFTA) have
resulted in the loss of hundreds of thousands of American jobs. Former Secretary of Labor Robert
Reich has called TPP "NAFTA on steroids." The loss of U.S. jobs under the TPP would likely be unprecedented.
"... Existing "trade" agreements like NAFTA allow corporations to sue governments for passing laws and regulations that limit their profits. They set up special " corporate courts " in which corporate attorneys decide the cases. These corporate "super courts" sit above governments and their own court systems, and countries and their citizens cannot even appeal the rulings. ..."
"... Now, corporations are pushing two new "trade" agreements - one covering Pacific-are countries and one covering Atlantic-area countries - that expand these corporate rights and move governments out of their way. The Pacific agreement is called the Trans-Pacific Partnership (TPP) and the Atlantic one is called the Trans-Atlantic Trade and Investment Partnership (TTIP). ..."
"... International corporations that want to intimidate countries have access to a private legal system designed just for them. And to unlock its power, sometimes all it takes is a threat. ..."
"... ISDS is so tilted and unpredictable, and the fines the arbitrators can impose are so catastrophically large, that bowing to a company's demands, however extreme they may be, can look like the prudent choice. ..."
BuzzFeed is running a very important investigative series called
"Secrets
of a Global Super Court." It describes what they call "a parallel legal
universe, open only to corporations and largely invisible to everyone else."
Existing "trade" agreements like NAFTA allow corporations to sue governments
for passing laws and regulations that limit their profits. They set up special
"corporate
courts" in which corporate attorneys decide the cases. These corporate "super
courts" sit above governments and their own court systems, and countries
and their citizens cannot even appeal the rulings.
Picture a poor "banana republic" country ruled by a dictator and his
cronies. A company might want to invest in a factory or railroad - things
that would help the people of that country as well as deliver a return to
the company. But the company worries that the dictator might decide to just
seize the factory and give it to his brother-in-law. Agreements to protect
investors, and allowing a tribunal not based in such countries (courts where
the judges are cronies of the dictator), make sense in such situations.
Here's the thing: Corporate investors see themselves as legitimate "makers"
and see citizens and voters and their governments - always demanding taxes and
fair pay and public safety - to be illegitimate "takers." Corporations are all
about "one-dollar-one-vote" top-down systems of governance. They consider "one-person-one-vote"
democracy to be an illegitimate, non-functional system that meddles with their
more-important profit interests. They consider any governmental legal or regulatory
system to be "burdensome." They consider taxes as "theft" of the money they
have "earned."
To them, any government anywhere is just another "banana republic"
from which they need special protection.
"Trade" Deals Bypass Borders
Investors and their corporations have set up a way to get around the borders
of these meddling governments, called "trade" deals. The trade deals elevate
global corporate interests above any national interest. When a country signs
a "trade" deal, that country is agreeing not to do things that protect the country's
own national interest - like impose tariffs to protect key industries or national
strategies, or pass laws and regulations - when those things interfere with
the larger, more important global corporate "trade" interests.
Now, corporations are pushing two new "trade" agreements - one covering
Pacific-are countries and one covering Atlantic-area countries - that expand
these corporate rights and move governments out of their way. The Pacific agreement
is called the Trans-Pacific Partnership (TPP) and the Atlantic one is called
the Trans-Atlantic Trade and Investment Partnership (TTIP).
Secrets of a Global Super Court
BuzzFeed's series on these corporate courts,
"Secrets
of a Global Super Court," explains the investor-state dispute settlement
(ISDS) provisions in the "trade" deals that have come to dominate the world
economy. These provisions set up "corporate
courts" that place corporate profits above the interests of governments
and set up a court system that sits above the court systems of the countries
in the "trade" deals.
In a little-noticed 2014 dissent, US Chief Justice John Roberts warned
that ISDS arbitration panels hold the alarming power to review a nation's
laws and "effectively annul the authoritative acts of its legislature, executive,
and judiciary." ISDS arbitrators, he continued, "can meet literally anywhere
in the world" and "sit in judgment" on a nation's "sovereign acts."
[. . .]
Reviewing publicly available information for about 300 claims filed during
the past five years, BuzzFeed News found more than 35 cases in which the
company or executive seeking protection in ISDS was accused of criminal
activity, including money laundering, embezzlement, stock manipulation,
bribery, war profiteering, and fraud.
Among them: a bank in Cyprus that the US government accused of
financing terrorism and organized crime, an oil company executive accused
of embezzling millions from the impoverished African nation of Burundi,
and the Russian oligarch known as "the
Kremlin's banker."
One lawyer who regularly represents governments said he's seen evidence
of corporate criminality that he "couldn't believe." Speaking on the condition
that he not be named because he's currently handling ISDS cases, he said,
"You have a lot of scuzzy sort-of thieves for whom this is a way to hit
the jackpot."
Part Two,
"The Billion-Dollar Ultimatum," looks at how "International corporations
that want to intimidate countries have access to a private legal system designed
just for them. And to unlock its power, sometimes all it takes is a threat."
Of all the ways in which ISDS is used, the most deeply hidden are the
threats, uttered in private meetings or ominous letters, that invoke those
courts. The threats are so powerful they often eliminate the need to actually
bring a lawsuit. Just the knowledge that it could happen is enough.
[. . .] ISDS is so tilted and unpredictable, and the fines the arbitrators
can impose are so catastrophically large, that bowing to a company's demands,
however extreme they may be, can look like the prudent choice. Especially
for nations struggling to emerge from corrupt dictatorships or to lift their
people from decades of poverty, the mere threat of an ISDS claim triggers
alarm. A single decision by a panel of three unaccountable, private lawyers,
meeting in a conference room on some other continent, could gut national
budgets and shake economies to the core.
Indeed, financiers and ISDS lawyers have created a whole new business:
prowling for ways to sue nations in ISDS and make their taxpayers fork over
huge sums, sometimes in retribution for enforcing basic laws or regulations.
The financial industry is pushing novel ISDS claims that countries
never could have anticipated - claims that, in some instances,
would be barred in US courts and those of other developed nations, or
that strike at emergency decisions nations make to cope with crises.
ISDS gives particular leverage to traders and speculators who chase
outsize profits in the developing world. They can buy into local disputes
that they have no connection to, then turn the disputes into costly international
showdowns. Standard Chartered, for example, bought the debt of a Tanzanian
company that was in dire financial straits and racked by scandal; now, the
bank has filed an ISDS claim demanding that the nation's taxpayers hand
over the full amount that the private company owed - more than $100 million.
Asked to comment, Standard Chartered said its claim is "valid."
But instead of helping companies resolve legitimate disputes over seized
assets, ISDS has increasingly become a way for rich investors to make money
by speculating on lawsuits, winning huge awards and forcing taxpayers to
foot the bill.
Here's how it works: Wealthy financiers with idle cash have purchased
companies that are well placed to bring an ISDS claim, seemingly for the
sole purpose of using that claim to make a buck. Sometimes, they set up
shell corporations to create the plaintiffs to bring ISDS cases.
And some hedge funds and private equity firms bankroll ISDS cases as third
parties - just like billionaire Peter Thiel bankrolled Hulk Hogan in his
lawsuit against Gawker Media.
The Progressive Change Campaign Committee (PCCC) released this statement
on the ISDS provisions in TPP:
"Under the Trans-Pacific Partnership, Wall Street would be allowed to
sue the government in extrajudicial, corporate-run tribunals over any regulation
and American taxpayers would be on the hook for damages. This is an outrage.
We need more accountability and fairness in our economy – not less. And
we need to preserve our ability to make our own rules.
"It's time for Obama to take notice of the widespread, bipartisan opposition
to the TPP and take this agreement off the table before he causes lasting
political harm to Democrats with voters."
"... "No TPP - a certainty in case Donald Trump is elected in November - means the end of US economic hegemony over Asia. Hillary Clinton knows it; and it's no accident President Obama is desperate to have TPP approved during a short window of opportunity, the lame-duck session of Congress from November 9 to January 3." ..."
"... To me, the key to our economic hegemony lies in our reserve currency hegemony. They will have to continue to supply us to get the currency. Unless we have injected too much already (no scholars have come forth to say how much trade deficits are necessary for the reserve currency to function as the reserve currency, and so, we have just kept buying – and I am wondering if we have bought too much and there is a need to starting running trade surpluses to soak up the excess money – just asking, I don't know the answer). ..."
A response to Hillary Clinton's America Exceptionalist Speech:
1. America Exceptionalist vs. the World..
2. Brezinski is extremely dejected.
3. Russia-China on the march.
4. "There will be blood. Hillary Clinton smells it already ."
"No TPP - a certainty in case Donald Trump is elected in November
- means the end of US economic hegemony over Asia. Hillary Clinton knows
it; and it's no accident President Obama is desperate to have TPP approved
during a short window of opportunity, the lame-duck session of Congress
from November 9 to January 3."
To me, the key to our economic hegemony lies in our reserve currency
hegemony. They will have to continue to supply us to get the currency. Unless
we have injected too much already (no scholars have come forth to say how
much trade deficits are necessary for the reserve currency to function as
the reserve currency, and so, we have just kept buying – and I am wondering
if we have bought too much and there is a need to starting running trade
surpluses to soak up the excess money – just asking, I don't know the answer).
Regarding the push to pass the TPP and TISA I've been needing to get
this off my chest and this seems to be as good a time as any:
In the face of public opposition to the TPP and TISA proponents have
trotted out a new argument: "we have come too far", "our national credibility
would be damaged if we stop now." The premise of which is that negotiations
have been going on so long, and have involved such effort that if the
U.S. were to back away now we would look bad and would lose significant
political capital.
On one level this argument is true. The negotiations have been long,
and many promises were made by the negotiators to secure to to this
point. Stepping back now would expose those promises as false and would
make that decade of effort a loss. It would also expose the politicians
who pushed for it in the face of public oppoosition to further loss
of status and to further opposition.
However, all of that is voided by one simple fact. The negotiations
were secret. All of that effort, all of the horse trading and the promise
making was done by a self-selected body of elites, for that same body,
and was hidden behind a wall of secrecy stronger than that afforded
to new weapons. The deals were hidden not just from the general public,
not from trade unions or environmental groups, but from the U.S. Congress
itself.
Therefore it has no public legitimacy. The promises made are not
"our" promises but Michael Froman's promises. They are not backed by
the full faith and credit of the U.S. government but only by the words
of a small body of appointees and the multinational corporations that
they serve. The corporations were invited to the table, Congress was
not.
What "elites" really mean when they say "America's credibility is
on the line" is that their credibility is on the line. If these deals
fail what will be lost is not America's stature but the premise that
a handful of appointees can cut deals in private and that the rest of
us will make good.
When that minor loss is laid against the far greater fact that the
terms of these deals are bad, that prior deals of this type have harmed
our real economies, and that the rules will further erode our national
sovreignity, there is no contest.
Michael Froman's reputation has no value. Our sovreignity, our economy,
our nation, does.
"What "elites" really mean when they say "America's credibility is on
the line" is that their credibility is on the line. If these deals fail
what will be lost is not America's stature but the premise that a handful
of appointees can cut deals in private and that the rest of us will make
good."
Yes! And the victory will taste so sweet when we bury this filthy, rotten,
piece of garbage. Obama's years of effort down the drain, his legacy tarnished
and unfinished.
I want TPP's defeat to send a clear message that the elites can't count
on their politicians to deliver for them. Let's make this thing their Stalingrad!
Leave deep scars so that they give up on TISA and stop trying to concoct
these absurd schemes like ISDS.
sorry but i don't see it that way at all. 'they' got a propaganda machine
to beat all 'they' make n break reps all the time. i do see a desperation
on a monetary/profit scale. widening the 'playing field' offers more profits
with less risk. for instance, our Pharams won't have to slash their prices
at the risk of sunshine laws, wish-washy politicians, competition, nor a
pissed off public. jmo tho')
LOL "America's credibility" LOL, these people need to get out more. In
the 60's you could hike high up into the Andes and the sheep herder had
two pics on the wall of his hut: Jesus and JFK. America retains its cachet
as a place to make money and be entertained, but as some kind of beacon
of morality and fair play in the world? Dead, buried, and long gone, the
hype-fest of slogans and taglines can only cover up so many massive, atrocious
and hypocritical actions and serial offenses.
Clinton Inc was mostly Bill helping Epstein get laid until after Kerry
lost. If this was the reelection of John Edwards, Kerry's running mate,
and a referendum on 12 years of Kerronomics, Bill and Hill would be opening
night speakers at the DNC and answers to trivia questions.
My guess is Obama is dropped swiftly and unceremoniously especially since
he doesn't have much of a presence in Washington.
"It looks as if we'll be firing Tomahawk cruise missiles at Syria in
the coming days, and critics are raising legitimate concerns:"
"Yet there is value in bolstering international norms against egregious
behavior like genocide or the use of chemical weapons. Since President Obama
established a "red line" about chemical weapons use, his credibility has
been at stake: he can't just whimper and back down."
Obama did back down.
NIcholas Kristof, vigilant protector of American credibility through
bombing Syria.
Ah yes the credibility of our élites. With their sterling record on Nafta's
benefits, Iraq's liberation, Greece's rebound, the IMF's rehabilitation
of countries
We must pass TPP or Tom Friedman will lose credibility, what?
"... pro-TPPers "consciously seek to weaken the national defense," that's exactly what's going on. Neoliberalism, through offshoring, weakens the national defense, because it puts our weaponry at the mercy of fragile and corruptible supply chains. ..."
"... Now, when we think about how corrupt the political class has become, it's not hard to see why Obama is confident that he will win. ..."
"... I think raising the ante rhetorically by framing a pro-TPP vote as treason could help sway a close vote; and if readers try that frame out, I'd like to hear the results ..."
There are two reasons: First, they consciously seek to weaken the national
defense. And second, the Investor-State Dispute Settlement (ISDS) system is
a
surrender of national sovereignty .
National Defense
This might be labeled the "Ghost Fleet" argument, since we're informed that
Paul Singer and Augustus Cole's techno-thriller has really caught the attention
of the national security class below the political appointee level, and that
this is a death blow for neoliberalism. Why? "The multi-billion dollar, next
generation F-35 aircraft, for instance, is rendered powerless after it is revealed
that Chinese microprocessor manufacturers had implanted malicious code into
products intended for the jet" (
Foreign Policy ). Clearly, we need, well, industrial policy, and we need
to bring a lot of manufacturing home.
From Brigadier General (Retired) John Adams :
In 2013, the Pentagon's Defense Science Board put forward a remarkable
report describing one of the most significant but little-recognized threats
to US security: deindustrialization. The report argued that the loss of
domestic U.S. manufacturing facilities has not only reduced U.S. living
standards but also compromised U.S. technology leadership "by enabling new
players to learn a technology and then gain the capability to improve on
it." The report explained that the offshoring of U.S. manufacturing presents
a particularly dangerous threat to U.S. military readiness through the "compromise
of the supply chain for key weapons systems components."
Our military is now shockingly vulnerable to major disruptions in the
supply chain, including from substandard manufacturing practices, natural
disasters, and price gouging by foreign nations. Poor manufacturing practices
in offshore factories lead to problem-plagued products, and foreign producers-acting
on the basis of their own military or economic interests-can sharply raise
prices or reduce or stop sales to the United States.
The link between TPP and this kind of offshoring has been well-established.
And, one might say, the link between neo-liberal economic policy "and this
kind of offshoring has been well-established" as well.
So, when I framed the issue as one where pro-TPPers "consciously seek
to weaken the national defense," that's exactly what's going on. Neoliberalism,
through offshoring, weakens the national defense, because it puts our weaponry
at the mercy of fragile and corruptible supply chains. Note that re-industrializing
America has positive appeal, too: For the right, on national security grounds;
and for the left, on labor's behalf (and maybe helping out the Rust Belt that
neoliberal policies of the last forty years did so much to destroy. Of course,
this framing would make Clinton a traitor, but you can't make an omelette without
breaking eggs. (Probably best to to let the right, in its refreshingly direct
fashion, use the actual "traitor" word, and the left, shocked, call for the
restoration of civility, using verbiage like "No, I wouldn't say she's a traitor.
She's certainly 'extremely careless' with our nation's security.")
ISDS
The Investor-State Dispute Settlement system is a hot mess (unless you represent
a corporation, or are one of tiny fraternity of international corporate lawyers
who can plead and/or judge ISDS cases).
Yves wrote :
What may have torched the latest Administration salvo is a well-timed
joint publication by Wikileaks and the New York Times of a recent version
of the so-called investment chapter. That section sets forth one of the
worst features of the agreement, the investor-state dispute settlement process
(ISDS). As we've described at length in earlier posts, the ISDS mechanism
strengthens the existing ISDS process. It allows for secret arbitration
panels to effectively overrule national regulations by allowing foreign
investors to sue governments over lost potential future profits in secret
arbitration panels. Those panels have been proved to be conflict-ridden
and arbitrary. And the grounds for appeal are limited and technical.
Here again we have a frame that appeals to both right and left. The very
thought of surrendering national sovereignty to an international organization
makes any good conservative's back teeth itch. And the left sees the "lost profits"
doctrine as a club to prevent future government programs they would like to
put in place (single payer, for example). And in both cases, the neoliberal
doctrine of putting markets before anything else makes pro-TPP-ers traitors.
To the right, because nationalism trumps internationalism; to the left, because
TPP prevents the State from looiking after the welfare of its people.
The Political State of Play
All I know is what I read in the papers, so what follows can only be speculation.
That said, there are two ways TPP could be passed: In the lame duck session,
by Obama, or after a new President is inaugurated, by Clinton (or possibly by
Trump[1]).
[OBAMA:] And hopefully, after the election is over and the dust settles,
there will be more attention to the actual facts behind the deal and it
won't just be a political symbol or a political football. And I will actually
sit down with people on both sides, on the right and on the left. I'll sit
down publicly with them and we'll go through the whole provisions. I would
enjoy that, because there's a lot of misinformation.
I'm really confident I can make the case this is good for American workers
and the American people. And people said we weren't going to be able to
get the trade authority to even present this before Congress, and somehow
we muddled through and got it done. And I intend to do the same with respect
to the actual agreement.
So it is looking like a very close vote. (For procedural and political
reasons, Obama will not bring it to a vote unless he is sure he has the
necessary votes). Now let's look at one special group of Representatives
who can swing this vote: the actual lame-ducks, i.e., those who will be
in office only until Jan. 3. It depends partly on how many lose their election
on Nov. 8, but the average number of representatives who left after the
last three elections was about 80.
Most of these people will be looking for a job, preferably one that can
pay them more than $1 million a year. From the data provided by OpenSecrets.org,
we can estimate that about a quarter of these people will become lobbyists.
(An additional number will work for firms that are clients of lobbyists).
So there you have it: It is all about corruption, and this is about as
unadulterated as corruption gets in our hallowed democracy, other than literal
cash under a literal table. These are the people whom Obama needs to pass
this agreement, and the window between Nov. 9 and Jan. 3 is the only time
that they are available to sell their votes to future employers without
any personal political consequences whatsoever. The only time that the electorate
can be rendered so completely irrelevant, if Obama can pull this off.
(The article doesn't talk about the Senate, but Fast Track passed the Senate
with a filibuster-proof super-majority, so the battle is in the House anyhow.
And although the text of TPP cannot be amended - that's what fast track means!
- there are still ways to affect the interpretation and enforcement of the text,
so Obama and his corporate allies have bargaining chips beyond Beltway sinecures.[2])
Now, when we think about how corrupt the political class has become,
it's not hard to see why Obama is confident that he will win. (
Remember , "[T]he preferences of economic elites have far more independent
impact upon policy change than the preferences of average citizens do.") However,
if the anti-TPP-ers raise the rhetorical stakes from policy disagreement to
treason, maybe a few of those 80 representatives will do the right thing (or,
if you prefer, decide that the reputational damage to their future career makes
a pro-TPP vote not worth it. Who wants to play golf with a traitor?)
Passing TPP after the Inaugural
After the coronation inaugural, Clinton will have to use more
complicated tactics than dangling goodies before the snouts of representatives
leaving for K Street. (We've seen that Clinton's putative opposition to TPP
is based on lawyerly parsing; and her base supports it. So I assume a Clinton
administration would go full speed ahead with it.) My own thought has been that
she'd set up a "conversation" on trade, and then buy off the national unions
with "jobs for the boys," so that they sell their locals down the river. Conservative
Jennifer Rubin has a better proposal , which meets Clinton's supposed criterion
of not hurting workers even better:
Depending on the election results and how many pro-free-trade Republicans
lose, it still might not be sufficient. Here's a further suggestion: Couple
it with a substantial infrastructure project that Clinton wants, but with
substantial safeguards to make sure that the money is wisely spent. Clinton
gets a big jobs bill - popular with both sides - and a revised TPP gets
through.
What Clinton needs is a significant revision to TPP that she can tout
as a real reform to trade agreements, one that satisfies some of the TPP's
critics on the left. A minor tweak is unlikely to assuage anyone; this change
needs to be a major one. Fortunately, there is a TPP provision that fits
the bill perfectly: investor state dispute settlement (ISDS), the procedure
that allows foreign investors to sue governments in an international tribunal.
Removing ISDS could triangulate the TPP debate, allowing for enough support
to get it through Congress.
Obama can't have a conversation on trade, or propose a jobs program, let
alone jettison ISDS; all he's got going for him is corruption.[3] So, interestingly,
although Clinton can't take the simple road of bribing the 80 represenatives,
she does have more to bargain with on policy. Rubin's jobs bill could at least
be framed as a riposte to the "Ghost Fleet" argument, since both are about "jawbs,"
even if infrastructure programs and reindustrialization aren't identical in
intent. And while I don't think Clinton would allow ISDS to be removed (
her corporate donors love it ), at least somebody's thinking about how to
pander to the left. Nevertheless, what does a jobs program matter if the new
jobs leave the country anyhow? And suppose ISDS is removed, but the removal
of the precautionary principle remains? We'd still get corporate-friendly decisions,
bilaterally. And people would end up balancing the inevitable Clinton complexity
and mush against the simplicity of the message that a vote for TPP is a vote
against the United States.
Conclusion
I hope I've persuaded you that TPP is still very much alive, and that both
Obama in the lame duck, and Clinton (or even Trump) when inaugurated have reasonable
hopes of passing it. However, I think raising the ante rhetorically by framing
a pro-TPP vote as treason could help sway a close vote; and if readers try that
frame out, I'd like to hear the results (especially when the result comes
from a letter to your Congress critter). Interestingly, Buzzfeed just published
tonight the first in a four-part series, devoted to the idea that ISDS is what
we have said it is all along: A surrender of national sovereignty.
Here's
a great slab of it :
Imagine a private, global super court that empowers corporations to bend
countries to their will.
Say a nation tries to prosecute a corrupt CEO or ban dangerous pollution.
Imagine that a company could turn to this super court and sue the whole
country for daring to interfere with its profits, demanding hundreds of
millions or even billions of dollars as retribution.
Imagine that this court is so powerful that nations often must heed its
rulings as if they came from their own supreme courts, with no meaningful
way to appeal. That it operates unconstrained by precedent or any significant
public oversight, often keeping its proceedings and sometimes even its decisions
secret. That the people who decide its cases are largely elite Western corporate
attorneys who have a vested interest in expanding the court's authority
because they profit from it directly, arguing cases one day and then sitting
in judgment another. That some of them half-jokingly refer to themselves
as "The Club" or "The Mafia."
And imagine that the penalties this court has imposed have been so crushing
- and its decisions so unpredictable - that some nations dare not risk a
trial, responding to the mere threat of a lawsuit by offering vast concessions,
such as rolling back their own laws or even wiping away the punishments
of convicted criminals.
This system is already in place, operating behind closed doors in office
buildings and conference rooms in cities around the world. Known as investor-state
dispute settlement, or ISDS, it is written into a vast network of treaties
that govern international trade and investment, including NAFTA and the
Trans-Pacific Partnership, which Congress must soon decide whether to ratify.
That's the stuff to give the troops!
NOTE
[1] Trump:
"I pledge to never sign any trade agreement that hurts our workers." Lotta
wiggle room there, and the lawyerly parsing is just like Clinton's. I don't
think it's useful to discuss what Trump might do on TPP, because until there
are other parties to the deal, there's no deal to be had. Right now, we're just
looking at
Trump doing A-B testing - not that there's anything wrong with that - which
the press confuses with policy proposals. So I'm not considering Trump because
I don't think we have any data to go on.
To pacify [those to whom he will corrupt appeal], Obama will
have to convince them that what they want will anyway be achieved, even
if these are not legally part of the TPP because the TPP text cannot be
amended.
He can try to achieve this through bilateral side agreements on specific
issues. Or he can insist that some countries take on extra obligations beyond
what is required by the TPP as a condition for obtaining a U.S. certification
that they have fulfilled their TPP obligations.
This certification is required for the U.S. to provide the TPP's benefits
to its partners, and the U.S. has previously made use of this process to
get countries to take on additional obligations, which can then be shown
to Congress members that their objectives have been met.
In other words, side deals.
[3] This should not be taken to imply that Clinton does not have corruption
going for her, too. She can also make all the side deals Obama can.
"... One of the main concerns with TTIP is that it could allow multinational corporations to effectively "sue" governments for taking actions that might damage their businesses. Critics claim American companies might be able to avoid having to meet various EU health, safety and environment regulations by challenging them in a quasi-court set up to resolve disputes between investors and states. ..."
"... These developments take place against the background of another major free trade agreement - the Trans Pacific Partnership ( TPP ) - hitting snags on the way to being pushed through Congress. ..."
"... "US Faces Major Setback" Well, actually, US corporations face a major setback. Average US citizens face a reprieve. ..."
TTIP negotiations have been ongoing since 2013 in an effort to establish a massive
free trade zone that would eliminate many tariffs. After 14 rounds of talks
that have lasted three years not a single common item out of
the 27 chapters being discussed has been agreed on. The United States has
refused to agree on an equal playing field between European and American companies
in the sphere of public procurement sticking to the principle of "buy American".
The opponents of the deal believe that in its current guise the TTIP is too
friendly to US businesses. One of the main concerns with TTIP is that it
could allow multinational corporations to effectively "sue" governments for
taking actions that might damage their businesses. Critics claim American companies
might be able to avoid having to meet various EU health, safety and environment
regulations by challenging them in a quasi-court set up to resolve disputes
between investors and states.
In Europe thousands of people supported by society groups, trade unions and
activists take to the streets expressing protest against the deal. Three million
people have signed a petition calling for it to be scrapped. For instance, various
trade unions and other groups have called for protests against the TTIP across
Germany to take place on September 17. A trade agreement with Canada has also
come under attack.
These developments take place against the background of another major
free trade agreement - the Trans Pacific Partnership (TPP)
- hitting snags on the way to being pushed through Congress. The chances
are really slim.
silverer •Sep 5, 2016 9:51 AM
"US Faces Major Setback" Well, actually, US corporations face a major
setback. Average US citizens face a reprieve.
"... Speaking to a local radio station before the joint rally, Farage urged Americans to "go out and fight" against Hillary Clinton. ..."
"... "I am going to say to people in this country that the circumstances, the similarities, the parallels between the people who voted Brexit and the people who could beat Clinton in a few weeks time here in America are uncanny," Farage told Super Talk Mississippi. "If they want things to change they have get up out of their chairs and go out and fight for it. It can happen. We've just proved it." ..."
"... It's not for me as a foreign politician to say who you should vote for ... All I will say is that if you vote for Hillary Clinton, then nothing will change. She represents the very politics that we've just broken through the Brexit vote in the United Kingdom. ..."
...the British politician, who was invited by Mississippi governor Phil Bryant, will draw parallels
between what he sees as the inspirational story of Brexit and Trump's campaign. Farage will describe
the Republican's campaign as a similar crusade by grassroots activists against "big banks and global
political insiders" and how those who feel disaffected and disenfranchised can become involved in
populist, rightwing politics. With Trump lagging in the polls, just as Brexit did prior to the vote
on the referendum, Farage will also hearten supporters by insisting that they can prove pundits and
oddsmakers wrong as well.
This message resonates with the Trump campaign's efforts to reach out to blue collar voters who
have become disillusioned with American politics, while also adding a unique flair to Trump's never
staid campaign rallies.
The event will mark the first meeting between Farage and Trump.
Arron Banks, the businessman who backed Leave.EU, the Brexit campaign group associated with the
UK Independence party (Ukip), tweeted that he would be meeting Trump over dinner and was looking
forward to Farage's speech.
The appointment last week of Stephen Bannon, former chairman of the Breitbart website, as
"CEO" of Trump's campaign has seen the example of the Brexit vote, which Breitbart enthusiastically
advocated, rise to the fore in Trump's campaign narrative.
Speaking to a local radio station before the joint rally, Farage urged Americans to "go out
and fight" against Hillary Clinton.
"I am going to say to people in this country that the circumstances, the similarities, the
parallels between the people who voted Brexit and the people who could beat Clinton in a few weeks
time here in America are uncanny," Farage told Super Talk Mississippi. "If they want things to change
they have get up out of their chairs and go out and fight for it. It can happen. We've just proved
it."
"I am being careful," he added when asked if he supported the controversial Republican nominee.
"It's not for me as a foreign politician to say who you should vote for ... All I will say is
that if you vote for Hillary Clinton, then nothing will change. She represents the very politics
that we've just broken through the Brexit vote in the United Kingdom."
"... As Mr. Buffet so keenly said it, There is a war going on, and we are winning. ..."
"... Just type `TPP editorial' into news.google.com and watch a toxic sludge of straw men, misdirection, and historical revisionism flow across your screen. And the `objective' straight news reporting is no better. ..."
"... "Why is it afraid of us?" Because we the people are perceived to be the enemy of America the Corporation. Whistleblowers have already stated that the NSA info is used to blackmail politicians and military leaders, provide corporate espionage to the highest payers and more devious machinations than the mind can grasp from behind a single computer. 9/11 was a coup – I say that because looking around the results tell me that. ..."
"... The fourth estate (the media) has been purchased outright by the second estate (the nobility). I guess you could call this an 'estate sale'. All power to the markets! ..."
Free Trade," the banner of Globalization, has not only wrecked the world's economy, it has left Western
Democracy in shambles. Europe edges ever closer to deflation. The Fed dare not increase interest
rates, now poised at barely above zero. As China's stock market threatened collapse, China poured
billions to prop it up. It's export machine is collapsing. Not once, but twice, it recently manipulated
its currency to makes its goods cheaper on the world market. What is happening?
The following two
graphs tell most of the story. First, an overview of Free Trade.
Capital fled from developed countries to undeveloped countries with slave-cheap labor, countries
with no environmental standards, countries with no support for collective bargaining. Corporations,
like Apple, set up shop in China and other undeveloped countries. Some, like China, manipulated its
currency to make exported goods to the West even cheaper. Some, like China, gave preferential tax
treatment to Western firm over indigenous firms. Economists cheered as corporate efficiency unsurprisingly
rose. U.S. citizens became mere consumers.
Thanks to Bill Clinton and the Financial Modernization Act, banks, now unconstrained, could peddle
rigged financial services, offer insurance on its own investment products–in short, banks were free
to play with everyone's money–and simply too big to fail. Credit was easy and breezy. If nasty Arabs
bombed the Trade Center, why the solution was simple: Go to the shopping mall–and buy. That remarkable
piece of advice is just what freedom has been all about.
Next: China's export machine sputters.
China's problem is that there are not enough orders to keep the export machine going. There comes
a time when industrialized nations simply run out of cash–I mean the little people run out of cash.
CEOs and those just below them–along with slick Wall Street gauchos–made bundles on Free Trade, corporate
capital that could set up shop in any impoverished nation in the world.. No worries about labor–dirt
cheap–or environmental regulations–just bring your gas masks. At some point the Western consumer
well was bound to run dry. Credit was exhausted; the little guy could not buy anymore. Free trade
was on its last legs.
So what did China do then? As its markets crashed, it tried to revive its export model, a model
based on foreign firms exporting cheap goods to the West. China lowered its exchange rates, not once
but twice. Then China tried to rescue the markets with cash infusion of billions. Still its market
continued to crash. Manufacturing plants had closed–thousands of them. Free Trade and Globalization
had run its course.
And what has the Fed been doing? Why quantitative easy–increase the money supply and lower short
term interest rates. Like China's latest currency manipulation, both were merely stop-gap measures.
No one, least of all Obama and his corporate advisors, was ready to address corporate outsourcing
that has cost millions of jobs. Prime the pump a little, but never address the real problem.
The WTO sets the groundwork for trade among its member states. That groundwork is deeply flawed.
Trade between impoverished third world countries and sophisticated first world economies is not merely
a matter of regulating "dumping"-not allowing one country to flood the market with cheap goods-nor
is it a matter of insuring that the each country does not favor its indigenous firms over foreign
firms. Comparable labor and environmental standards are necessary. Does anyone think that a first
world worker can compete with virtual slave labor? Does anyone think that a first world nation with
excellent environmental regulations can compete with a third world nation that refuses to protect
its environment?
Only lately has Apple even mentioned that it might clean up its mess in China. The Apple miracle
has been on the backs of the Chinese poor and abysmal environmental wreckage that is China.
The WTO allows three forms of inequities-all of which encourage outsourcing: labor arbitrage,
tax arbitrage, and environmental arbitrage. For a fuller explanation of these inequities and the
"race to the bottom," see
here.
Of course now we have the mother of all Free Trade deals –the Trans-Pacific Partnership (TPP)–
carefully wrapped in a black box so that none of us can see what finally is in store for us. Nothing
is ever "Free"–even trade. I suspect that China is becoming a bit too noxious and poisonous. It simply
has to deal with its massive environmental problems. Time to move the game to less despoiled and
maybe more impoverished countries. Meanwhile, newscasters are always careful to tout TPP.
Fast Tracking is a con man's game. Do it so fast that the marks never have a chance to watch their
wallets. In hiding negotiations from prying, public eyes, Obama, has given the con men a bigger edge:
A screen to hide the corporations making deals. Their interest is in profits, not in public good.
Consider the media. Our only defense is a strong independent media. At one time,
newsrooms were not required to be profitable. Reporting the news was considered a community service.
Corporate ownership provided the necessary funding for its newsrooms–and did not interfere.
But the 70′s and 80′s corporate ownership required its newsrooms to be profitable. Slowly but
surely, newsrooms focused on personality, entertainment, and wedge issues–always careful not to rock
the corporate boat, always careful not to tread on governmental policy. Whoever thought that one
major news service–Fox–would become a breeding ground for one particular party.
But consider CNN: It organizes endless GOP debates; then spends hours dissecting them. Create
the news; then sell it–and be sure to spin it in the direction you want.
Are matters of substance ever discussed? When has a serious foreign policy debate ever been allowed
occurred–without editorial interference from the media itself. When has trade and outsourcing been
seriously discussed–other than by peripheral news media?
Meanwhile, news media becomes more and more centralized. Murdoch now owns National Geographic!
Now, thanks to Bush and Obama, we have the chilling effect of the NSA. Just whom does the NSA
serve when it collects all of our digital information? Is it being used to ferret out the plans of
those exercising their right of dissent? Is it being used to increase the profits of favored corporations?
Why does it need all of your and my personal information–from bank accounts, to credit cards, to
travel plans, to friends with whom we chat .Why is it afraid of us?
jefemt, October 23, 2015 at 9:43 am
As Mr. Buffet so keenly said it, There is a war going on, and we are winning.
If 'they' are failing, I'd hate to see success!
Isn't it the un-collective WE who are failing?
failing to organize,
failing to come up with plausible, 90 degrees off present Lemming-to-Brink path alternative plans
and policies,
failing to agree on any of many plausible alternatives that might work
Divided- for now- hopefully not conquered ..
I gotta scoot and get back to Dancing with the Master Chefs
allan, October 23, 2015 at 10:03 am
Just type `TPP editorial' into news.google.com and watch a toxic sludge of straw men, misdirection,
and historical revisionism flow across your screen. And the `objective' straight news reporting
is no better.
Vatch, October 23, 2015 at 10:36 am
Don't just watch the toxic sludge; respond to it with a letter to the editor (LTE) of the offending
publication! For some of those toxic editorials, and contact information for LTEs, see:
A few of the editorials may now be obscured by paywalls or registration requirements, but most
should still be visible. Let them know that we see through their nonsense!
TedWa, October 23, 2015 at 10:38 am
"Why is it afraid of us?" Because we the people are perceived to be the enemy of America
the Corporation. Whistleblowers have already stated that the NSA info is used to blackmail politicians
and military leaders, provide corporate espionage to the highest payers and more devious machinations
than the mind can grasp from behind a single computer. 9/11 was a coup – I say that because looking
around the results tell me that.
TG, October 23, 2015 at 3:27 pm
The fourth estate (the media) has been purchased outright by the second estate (the nobility).
I guess you could call this an 'estate sale'. All power to the markets!
Pelham, October 23, 2015 at 8:32 pm
Even when newsrooms were more independent they probably would not, in general, have reported
on free trade with any degree of skepticism. The recent disappearance of the old firewall between
the news and corporate sides has made things worse, but at least since the "professionalization"
of newsrooms that began to really take hold in the '60s, journalists have tended to identify far
more with their sources in power than with their readers.
There have, of course, been notable exceptions. But even these sometimes serve more to obscure
the real day-to-day nature of journalism's fealty to the corporate world than to bring about any
significant change.
CHRIS HEDGES: We're going to be discussing a great Ponzi scheme that not only defines not only
the U.S. but the global economy, how we got there and where we're going. And with me to discuss this
issue is the economist Michael Hudson, author of
Killing
the Host: How Financial Parasites and Debt Destroy the Global Economy. A professor of economics
who worked for many years on Wall Street, where you don't succeed if you don't grasp Marx's dictum
that capitalism is about exploitation. And he is also, I should mention, the godson of Leon Trotsky.
I want to open this discussion by reading a passage from your book, which I admire very much,
which I think gets to the core of what you discuss. You write,
"Adam Smith long ago remarked that profits often are highest in nations going fastest to
ruin. There are many ways to create economic suicide on a national level. The major way through
history has been through indebting the economy. Debt always expands to reach a point where it
cannot be paid by a large swathe of the economy. This is the point where austerity is imposed
and ownership of wealth polarizes between the One Percent and the 99 Percent. Today is not the
first time this has occurred in history. But it is the first time that running into debt has occurred
deliberately." Applauded. "As if most debtors can get rich by borrowing, not reduced to a condition
of debt peonage."
So let's start with the classical economists, who certainly understood this. They were reacting
of course to feudalism. And what happened to the study of economics so that it became gamed by ideologues?
HUDSON: The essence of classical economics was to reform industrial capitalism, to streamline
it, and to free the European economies from the legacy of feudalism. The legacy of feudalism was
landlords extracting land-rent, and living as a class that took income without producing anything.
Also, banks that were not funding industry. The leading industrialists from James Watt, with his
steam engine, to the railroads
HEDGES: From your book you make the point that banks almost never funded industry.
HUDSON: That's the point: They never have. By the time you got to Marx later in the 19th century,
you had a discussion, largely in Germany, over how to make banks do something they did not do under
feudalism. Right now we're having the economic surplus being drained not by the landlords
but also by banks and bondholders.
Adam Smith was very much against colonialism because that lead to wars, and wars led to public
debt. He said the solution to prevent this financial class of bondholders burdening the economy by
imposing more and more taxes on consumer goods every time they went to war was to finance wars on
a pay-as-you-go basis. Instead of borrowing, you'd tax the people. Then, he thought, if everybody
felt the burden of war in the form of paying taxes, they'd be against it. Well, it took all of the
19th century to fight for democracy and to extend the vote so that instead of landlords controlling
Parliament and its law-making and tax system through the House of Lords, you'd extend the vote to
labor, to women and everybody. The theory was that society as a whole would vote in its self-interest.
It would vote for the 99 Percent, not for the One Percent.
By the time Marx wrote in the 1870s, he could see what was happening in Germany. German banks
were trying to make money in conjunction with the government, by lending to heavy industry, largely
to the military-industrial complex.
HEDGES: This was Bismarck's kind of social – I don't know what we'd call it. It was a form
of capitalist socialism
HUDSON: They called it State Capitalism. There was a long discussion by Engels, saying, wait a
minute. We're for Socialism. State Capitalism isn't what we mean by socialism. There are two kinds
of state-oriented–.
HEDGES: I'm going to interject that there was a kind of brilliance behind Bismarck's policy
because he created state pensions, he provided health benefits, and he directed banking toward industry,
toward the industrialization of Germany which, as you point out, was very different in Britain and
the United States.
HUDSON: German banking was so successful that by the time World War I broke out, there were discussions
in English economic journals worrying that Germany and the Axis powers were going to win because
their banks were more suited to fund industry. Without industry you can't have really a military.
But British banks only lent for foreign trade and for speculation. Their stock market was a hit-and-run
operation. They wanted quick in-and-out profits, while German banks didn't insist that their clients
pay as much in dividends. German banks owned stocks as well as bonds, and there was much more of
a mutual partnership.
That's what most of the 19th century imagined was going to happen – that the world
was on the way to socializing banking. And toward moving capitalism beyond the feudal level, getting
rid of the landlord class, getting rid of the rent, getting rid of interest. It was going to be labor
and capital, profits and wages, with profits being reinvested in more capital. You'd have an expansion
of technology. By the early twentieth century most futurists imagined that we'd be living in a leisure
economy by now.
HEDGES: Including Karl Marx.
HUDSON: That's right. A ten-hour workweek. To Marx, socialism was to be an outgrowth of the reformed
state of capitalism, as seemed likely at the time – if labor organized in its self-interest.
HEDGES: Isn't what happened in large part because of the defeat of Germany in World War I?
But also, because we took the understanding of economists like Adam Smith and maybe Keynes. I don't
know who you would blame for this, whether Ricardo or others, but we created a fictitious economic
theory to praise a rentier or rent-derived, interest-derived capitalism that countered productive
forces within the economy. Perhaps you can address that.
HUDSON: Here's what happened. Marx traumatized classical economics by taking the concepts of Adam
Smith and John Stuart Mill and others, and pushing them to their logical conclusion.
Progressive
capitalist advocates – Ricardian socialists such as John Stuart Mill – wanted to tax away the land
or nationalize it. Marx wanted governments to take over heavy industry and build infrastructure to
provide low-cost and ultimately free basic services. This was traumatizing the landlord class and
the One Percent. And they fought back. They wanted to make everything part of "the market," which
functioned on credit supplied by them and paid rent to them.
None of the classical economists imagined how the feudal interests – these great vested interests
that had all the land and money – actually would fight back and succeed. They thought that the future
was going to belong to capital and labor. But by the late 19th century, certainly in America,
people like John Bates Clark came out with a completely different theory, rejecting the classical
economics of Adam Smith, the Physiocrats and John Stuart Mill.
HEDGES: Physiocrats are, you've tried to explain, the enlightened French economists.
HUDSON: The common denominator among all these classical economists was the distinction between
earned income and unearned income. Unearned income was rent and interest. Earned incomes were wages
and profits. But John Bates Clark came and said that there's no such thing as unearned income. He
said that the landlord actually earns his rent by taking the effort to provide a house and
land to renters, while banks provide credit to earn their interest. Every kind of income is thus
"earned," and everybody earns their income. So everybody who accumulates wealth, by definition, according
to his formulas, get rich by adding to what is now called Gross Domestic Product (GDP).
HEDGES: One of the points you make in
Killing
the Host which I liked was that in almost all cases, those who had the capacity to make money
parasitically off interest and rent had either – if you go back to the origins – looted and seized
the land by force, or inherited it.
HUDSON: That's correct. In other words, their income is unearned. The result of this anti-classical
revolution you had just before World War I was that today, almost all the economic growth in the
last decade has gone to the One Percent. It's gone to Wall Street, to real estate
HEDGES: But you blame this on what you call Junk Economics.
HUDSON: Junk Economics is the anti-classical reaction.
HEDGES: Explain a little bit how, in essence, it's a fictitious form of measuring the economy.
HUDSON: Well, some time ago I went to a bank, a block away from here – a Chase Manhattan bank
– and I took out money from the teller. As I turned around and took a few steps, there were two pickpockets.
One pushed me over and the other grabbed the money and ran out. The guard stood there and saw it.
So I asked for the money back. I said, look, I was robbed in your bank, right inside. And they said,
"Well, we don't arm our guards because if they shot someone, the thief could sue us and we don't
want that." They gave me an equivalent amount of money back.
Well, imagine if you count all this crime, all the money that's taken, as an addition to GDP.
Because now the crook has provided the service of not stabbing me. Or suppose somebody's held up
at an ATM machine and the robber says, "Your money or your life." You say, "Okay, here's my money."
The crook has given you the choice of your life. In a way that's how the Gross National Product accounts
are put up. It's not so different from how Wall Street extracts money from the economy. Then also
you have landlords extracting
HEDGES: Let's go back. They're extracting money from the economy by debt peonage. By raising
HUDSON: By not playing a productive role, basically.
HEDGES: Right. So it's credit card interest, mortgage interest, car loans, student loans. That's
how they make their funds.
HUDSON: That's right. Money is not a factor of production. But in order to have access to credit,
in order to get money, in order to get an education, you have to pay the banks. At New York University
here, for instance, they have Citibank. I think Citibank people were on the board of directors at
NYU. You get the students, when they come here, to start at the local bank. And once you are in a
bank and have monthly funds taken out of your account for electric utilities, or whatever, it's very
cumbersome to change.
So basically you have what the classical economists called the rentier class. The class
that lives on economic rents. Landlords, monopolists charging more, and the banks. If you have a
pharmaceutical company that raises the price of a drug from $12 a shot to $200 all of a sudden, their
profits go up. Their increased price for the drug is counted in the national income accounts as if
the economy is producing more. So all this presumed economic growth that has all been taken by the
One Percent in the last ten years, and people say the economy is growing. But the economy isn't growing
HEDGES: Because it's not reinvested.
HUDSON: That's right. It's not production, it's not consumption. The wealth of the One Percent
is obtained essentially by lending money to the 99 Percent and then charging interest on it, and
recycling this interest at an exponentially growing rate.
HEDGES: And why is it important, as I think you point out in your book, that economic theory
counts this rentier income as productive income? Explain why that's important.
HUDSON: If you're a rentier, you want to say that you earned your income by
HEDGES: We're talking about Goldman Sachs, by the way.
HUDSON: Yes, Goldman Sachs. The head of Goldman Sachs came out and said that Goldman Sachs workers
are the most productive in the world. That's why they're paid what they are. The concept of productivity
in America is income divided by labor. So if you're Goldman Sachs and you pay yourself $20 million
a year in salary and bonuses, you're considered to have added $20 million to GDP, and that's enormously
productive. So we're talking in a tautology. We're talking with circular reasoning here.
So the issue is whether Goldman Sachs, Wall Street and predatory pharmaceutical firms, actually
add "product" or whether they're just exploiting other people. That's why I used the word parasitism
in my book's title. People think of a parasite as simply taking money, taking blood out of a host
or taking money out of the economy. But in nature it's much more complicated. The parasite can't
simply come in and take something. First of all, it needs to numb the host. It has an enzyme so that
the host doesn't realize the parasite's there. And then the parasites have another enzyme that takes
over the host's brain. It makes the host imagine that the parasite is part of its own body, actually
part of itself and hence to be protected.
That's basically what Wall Street has done. It depicts itself as part of the economy. Not as a
wrapping around it, not as external to it, but actually the part that's helping the body grow, and
that actually is responsible for most of the growth. But in fact it's the parasite that is taking
over the growth.
The result is an inversion of classical economics. It turns Adam Smith upside down. It says what
the classical economists said was unproductive – parasitism – actually is the real economy. And that
the parasites are labor and industry that get in the way of what the parasite wants – which is to
reproduce itself, not help the host, that is, labor and capital.
HEDGES: And then the classical economists like Adam Smith were quite clear that unless that
rentier income, you know, the money made by things like hedge funds, was heavily taxed and put back
into the economy, the economy would ultimately go into a kind of tailspin. And I think the example
of that, which you point out in your book, is what's happened in terms of large corporations with
stock dividends and buybacks. And maybe you can explain that.
HUDSON: There's an idea in superficial textbooks and the public media that if companies make a
large profit, they make it by being productive. And with
HEDGES: Which is still in textbooks, isn't it?
HUDSON: Yes. And also that if a stock price goes up, you're just capitalizing the profits – and
the stock price reflects the productive role of the company. But that's not what's been happening
in the last ten years. Just in the last two years, 92 percent of corporate profits in America have
been spent either on buying back their own stock, or paid out as dividends to raise the price of
the stock.
HEDGES: Explain why they do this.
HUDSON: About 15 years ago at Harvard, Professor Jensen said that the way to ensure that corporations
are run most efficiently is to make the managers increase the price of the stock. So if you give
the managers stock options, and you pay them not according to how much they're producing or making
the company bigger, or expanding production, but the price of the stock, then you'll have the corporation
run efficiently, financial style.
So the corporate managers find there are two ways that they can increase the price of the stock.
The first thing is to cut back long-term investment, and use the money instead to buy back their
own stock. But when you buy your own stock, that means you're not putting the money into capital
formation. You're not building new factories. You're not hiring more labor. You can actually increase
the stock price by firing labor.
HEDGES: That strategy only works temporarily.
HUDSON: Temporarily. By using the income from past investments just to buy back stock, fire the
labor force if you can, and work it more intensively. Pay it out as dividends. That basically is
the corporate raider's model. You use the money to pay off the junk bond holders at high interest.
And of course, this gets the company in trouble after a while, because there is no new investment.
So markets shrink. You then go to the labor unions and say, gee, this company's near bankruptcy,
and we don't want to have to fire you. The way that you can keep your job is if we downgrade your
pensions. Instead of giving you what we promised, the defined benefit pension, we'll turn it into
a defined contribution plan. You know what you pay every month, but you don't know what's going to
come out. Or, you wipe out the pension fund, push it on to the government's Pension Benefit Guarantee
Corporation, and use the money that you were going to pay for pensions to pay stock dividends. By
then the whole economy is turning down. It's hollowed out. It shrinks and collapses. But by that
time the managers will have left the company. They will have taken their bonuses and salaries and
run.
HEDGES: I want to read this quote from your book, written by David Harvey, in
A Brief
History of Neoliberalism, and have you comment on it.
"The main substantive achievement of neoliberalism has been to redistribute rather than
to generate wealth and income. [By] 'accumulation by dispossession' I mean the commodification
and privatization of land, and the forceful expulsion of peasant populations; conversion of various
forms of property rights (common collective state, etc.) into exclusive private property rights;
suppression of rights to the commons; colonial, neocolonial, and the imperial processes of appropriation
of assets (including natural resources); and usury, the national debt and, most devastating
at all, the use of the credit system as a radical means of accumulation by dispossession. To
this list of mechanisms, we may now add a raft of techniques such as the extraction of rents from
patents, and intellectual property rights (such as the diminution or erasure of various forms
of common property rights, such as state pensions, paid vacations, and access to education, health
care) one through a generation or more of class struggle. The proposal to privatize all state
pension rights, pioneered in Chile under the dictatorship is, for example, one of the cherished
objectives of the Republicans in the US."
This explains the denouement. The final end result you speak about in your book is, in essence,
allowing what you call the rentier or the speculative class to cannibalize the entire society until
it collapses.
HUDSON: A property right is not a factor of production. Look at what happened in Chicago, the
city where I grew up. Chicago didn't want to raise taxes on real estate, especially on its expensive
commercial real estate. So its budget ran a deficit. They needed money to pay the bondholders, so
they sold off the parking rights to have meters – you know, along the curbs. The result is that they
sold to Goldman Sachs 75 years of the right to put up parking meters. So now the cost of living and
doing business in Chicago is raised by having to pay the parking meters. If Chicago is going to have
a parade and block off traffic, it has to pay Goldman Sachs what the firm would have made
if the streets wouldn't have been closed off for a parade. All of a sudden it's much more expensive
to live in Chicago because of this.
But this added expense of having to pay parking rights to Goldman Sachs – to pay out interest
to its bondholders – is counted as an increase in GDP, because you've created more product simply
by charging more. If you sell off a road, a government or local road, and you put up a toll booth
and make it into a toll road, all of a sudden GDP goes up.
If you go to war abroad, and you spend more money on the military-industrial complex, all this
is counted as increased production. None of this is really part of the production system of the capital
and labor building more factories and producing more things that people need to live and do business.
All of this is overhead. But there's no distinction between wealth and overhead.
Failing to draw that distinction means that the host doesn't realize that there is a parasite
there. The host economy, the industrial economy, doesn't realize what the industrialists realized
in the 19th century: If you want to be an efficient economy and be low-priced and under-sell
competitors, you have to cut your prices by having the public sector provide roads freely. Medical
care freely. Education freely.
If you charge for all of these, you get to the point that the U.S. economy is in today. What if
American factory workers were to get all of their consumer goods for nothing. All their food,
transportation, clothing, furniture, everything for nothing. They still couldn't compete with
Asians or other producers, because they have to pay up to 43% of their income for rent or mortgage
interest, 10% or more of their income for student loans, credit card debt. 15% of their paycheck
is automatic withholding to pay Social Security, to cut taxes on the rich or to pay for medical care.
So Americans built into the economy all this overhead. There's no distinction between growth and
overhead. It's all made America so high-priced that we're priced out of the market, regardless of
what trade policy we have.
HEDGES: We should add that under this predatory form of economics, you game the system. So
you privatize pension funds, you force them into the stock market, an overinflated stock market.
But because of the way companies go public, it's the hedge fund managers who profit. And it's those
citizens whose retirement savings are tied to the stock market who lose. Maybe we can just conclude
by talking about how the system is fixed, not only in terms of burdening the citizen with debt peonage,
but by forcing them into the market to fleece them again.
HUDSON: Well, we talk about an innovation economy as if that makes money. Suppose you have an
innovation and a company goes public. They go to Goldman Sachs and other Wall Street investment banks
to underwrite the stock to issue it at $40 a share. What's considered a successful float is when,
immediately, Goldman and the others will go to their insiders and tell them to buy this stock and
make a quick killing. A "successful" flotation doubles the price in one day, so that at the end of
the day the stock's selling for $80.
HEDGES: They have the option to buy it before anyone else, knowing that by the end of the day
it'll be inflated, and then they sell it off.
HUDSON: That's exactly right.
HEDGES: So the pension funds come in and buy it at an inflated price, and then it goes back
down.
HUDSON: It may go back down, or it may be that the company just was shortchanged from the very
beginning. The important thing is that the Wall Street underwriting firm, and the speculators it
rounds up, get more in a single day than all the years it took to put the company together. The company
gets $40. And the banks and their crony speculators also get $40.
So basically you have the financial sector ending up with much more of the gains. The name of
the game if you're on Wall Street isn't profits. It's capital gains. And that's something that wasn't
even part of classical economics. They didn't anticipate that the price of assets would go up for
any other reason than earning more money and capitalizing on income. But what you have had in the
last 50 years – really since World War II – has been asset-price inflation. Most middle-class families
have gotten the wealth that they've got since 1945 not really by saving what they've earned by working,
but by the price of their house going up. They've benefited by the price of the house. And they think
that that's made them rich and the whole economy rich.
The reason the price of housing has gone up is that a house is worth whatever a bank is going
to lend against it. If banks made easier and easier credit, lower down payments, then you're going
to have a financial bubble. And now, you have real estate having gone up as high as it can. I don't
think it can take more than 43% of somebody's income to buy it. But now, imagine if you're joining
the labor force. You're not going to be able to buy a house at today's prices, putting down a little
bit of your money, and then somehow end up getting rich just on the house investment. All of this
money you pay the bank is now going to be subtracted from the amount of money that you have available
to spend on goods and services.
So we've turned the post-war economy that made America prosperous and rich inside out. Somehow
most people believed they could get rich by going into debt to borrow assets that were going to rise
in price. But you can't get rich, ultimately, by going into debt. In the end the creditors always
win. That's why every society since Sumer and Babylonia have had to either cancel the debts, or you
come to a society like Rome that didn't cancel the debts, and then you have a dark age. Everything
collapses.
"... Furthermore, as Mark Kleiman sagely observes , the conventional case for trade liberalization relies on the assertion that the government could redistribute income to ensure that everyone wins - but we now have an ideology utterly opposed to such redistribution in full control of one party, and with blocking power against anything but a minor move in that direction by the other. ..."
A Protectionist Moment? : ... if Sanders were to make it to the White House, he would find
it very hard to do anything much about globalization - not because it's technically or economically
impossible, but because the moment he looked into actually tearing up existing trade agreements
the diplomatic, foreign-policy costs would be overwhelmingly obvious. ...
But it's also true
that much of the elite defense of globalization is basically dishonest: false claims of inevitability,
scare tactics (
protectionism causes depressions !), vastly exaggerated claims for the benefits of trade liberalization
and the costs of protection, hand-waving away the large distributional effects that are what standard
models actually predict. I hope, by the way, that I haven't done any of that...
Furthermore, as Mark Kleiman
sagely observes , the conventional case for trade liberalization relies on the assertion that
the government could redistribute income to ensure that everyone wins - but we now have an ideology
utterly opposed to such redistribution in full control of one party, and with blocking power against
anything but a minor move in that direction by the other.
So the elite case for ever-freer trade is largely a scam, which voters probably sense even
if they don't know exactly what form it's taking.
Ripping up the trade agreements we already have would, again, be a mess, and I would say that
Sanders is engaged in a bit of a scam himself in even hinting that he could do such a thing. Trump
might actually do it, but only as part of a reign of destruction on many fronts.
But it is fair to say that the case for more trade agreements - including TPP, which hasn't
happened yet - is very, very weak. And if a progressive makes it to the White House, she should
devote no political capital whatsoever to such things.
Again, just because automation has been a major factor in job loss doesn't mean "off shoring"
(using the term broadly and perhaps somewhat inaccurately) is not a factor.
The "free" trade deals suck. They are correctly diagnosed as part of the problem.
What would you propose to fix the problems caused by automation?
Automation frees labor to do more productive and less onerous tasks. We should expand our solar
production and our mass transit. We need to start re-engineering our urban areas. This will not
bring back the number of jobs it would take to make cities like Flint thrive once again.
Flint and Detroit have severe economic problems because they were mismanaged by road building
and suburbanization in the 1950s and 1960s. Money that should have been spent on maintaining and
improving urban infrastructure was instead plowed into suburban development that is not dense
enough to sustain the infrastructure required to support it. People moved to the suburbs, abandoned
the built infrastructure of the cities and kissed them goodbye.
Big roads polluted the cities with lead, noise, diesel particles and ozone and smog. Stroads
created pedestrian kill zones making urban areas, unwalkable, unpleasant- an urban blights to
drive through rather than destinations to drive to.
Government subsidized the white flight to the suburbs that has left both the suburbs and the
urban cores with too low revenue to infrastructure ratio. The inner suburbs have aged into net
losers, their infrastructure must be subsidized. Big Roads were built on the Big Idea that people
would drive to the city to work and play and then drive home. That Big idea has a big problem.
Urban areas are only sustainable when they have a high resident density. The future of cities
like Flint and Detroit will be tearing out the roads and replacing them with streets and houses
and renewing the housing stock that has been abandoned. It needs to be done by infill, revitalizing
inner neighborhoods and working outward. Cities like Portland have managed to protect much of
their core, but even they are challenged by demands for suburban sprawl.
Slash and burn development, creating new suburbs and abandoning the old is not a sustainable
model. Not only should we put people to work replacing the Flint lead pipes, but much of the city
should be rebuilt from the inside out. Flint is the leading edge of this problem that requires
fundamental changes in our built environment to fix. I recommend studying Flint as an object lesson
of what bad development policy could do to all of our cities.
An Interview with Frank Popper about Shrinking Cities, Buffalo Commons, and the Future of Flint
How does America's approach shrinking cities compare to the rest of the world?
I think the American way is to do nothing until it's too late, then throw everything at it
and improvise and hope everything works. And somehow, insofar as the country's still here, it
has worked. But the European or the Japanese way would involve much more thought, much more foresight,
much more central planning, and much less improvising. They would implement a more, shall we say,
sustained effort. The American way is different. Europeans have wondered for years and years why
cities like Detroit or Cleveland are left to rot on the vine. There's a lot of this French hauteur
when they ask "How'd you let this happen?"
Do shrinking cities have any advantages over agricultural regions as they face declining populations?
The urban areas have this huge advantage over all these larger American regions that are going
through this. They have actual governments with real jurisdiction. Corrupt as Detroit or Philadelphia
or Camden may be, they have actual governments that are supposed to be in charge of them. Who's
in charge of western Kansas? Who's in charge of the Great Plains? Who is in charge of the lower
Mississippi Delta or central Appalachia? All they've got are these distant federal agencies whose
past performance is not exactly encouraging.
Why wasn't there a greater outcry as the agricultural economy and the industrial economy collapsed?
One reason for the rest of the country not to care is that there's no shortage of the consumer
goods that these places once produced. All this decline of agriculture doesn't mean we're running
out of food. We've got food coming out of our ears. Likewise, Flint has suffered through all this,
but it's not like it's hard to buy a car in this country. It's not as if Flint can behave like
a child and say "I'm going to hold my nose and stop you from getting cars until you do the right
thing." Flint died and you can get zero A.P.R. financing. Western Kansas is on its last legs and,
gee, cereal is cheaper than ever.
In some sense that's the genius of capitalism - it's heartless. But if you look at the local
results and the cultural results and the environmental results you shake your head. But I don't
see America getting away from what I would call a little sarcastically the "wisdom" of the market.
I don't think it's going to change.
So is there any large-scale economic fallout from these monumental changes?
Probably not, and it hurts to say so. And the only way I can feel good about saying that is
to immediately point to the non-economic losses, the cultural losses. The losses of ways of life.
The notion of the factory worker working for his or her children. The notion of the farmer working
to build up the country and supply the rest of the world with food. We're losing distinctive ways
of life. When we lose that we lose something important, but it's not like The Wall Street Journal
cares. And I feel uncomfortable saying that. From a purely economic point of view, it's just the
price of getting more efficient. It's a classic example of Schumpeter's theory of creative destruction,
which is no fun if you're on the destruction end.
Does the decline of cities like Flint mirror the death of the middle class in the United States?
I think it's more the decline of the lower-middle class in the United States. Even when those
jobs in the auto factories paid very high wages they were still for socially lower-middle-class
people. I think there was always the notion in immigrant families and working-class families who
worked in those situations that the current generation would work hard so that the children could
go off and not have to do those kind of jobs. And when those jobs paid well that was a perfectly
reasonable ambition. It's the cutting off of that ambition that really hurts now. The same thing
has been true on farms and ranches in rural parts of the united states.
It is a much different thing to be small minded about trade than it is to be large minded about
everything else. The short story that it is all about automation and not trade will always get
a bad reception because it is small minded. When you add in the large minded story about everything
else then it becomes something entirely different from the short story. We all agree with you
about everything else. You are wrong about globalization though. Both financialization and globalization
suck and even if we paper over them with tax and transfer then they will still suck. One must
forget what it is to be a created equal human to miss that. Have you never felt the job of accomplishment?
Does not pride and self-confidence matter in your life?
While automation is part of the story, offshoring is just as important. Even when there is not
net loss in the numbers of jobs in aggregate, there is significant loss in better paying jobs
in manufacturing. It is important to look at the distributional effects within countries, as well
as between them
It would probably be cheaper and easier to just fix them. We don't need to withdraw from trade.
We just need to fix the terms of trade that cause large trade deficits and cross border capital
flows and also fix the FOREX system rigging.
What would it take to ignore trade agreements? They shouldn't be any more difficult to ignore
than the Geneva Conventions, which the US routinely flaunts.
In order to import we must export and in order to export we must import. The two are tied together.
Suppressing imports means we export less.
What free trade does is lower the price level relative to wages. It doesn't uniformly lower
the price level but rather lowers the cost of goods that are capable of being traded internationally.
It lowers the price on those goods that are disproportionately purchased by those with low incomes.
Free trade causes a progressive decline in the price level while protectionism causes a regressive
increase in the price level.
Funny rebuttal! Bhagwati probably has a model that says the opposite! But then he grew up in India
and should one day get a Nobel Prize for his contributions to international economics.
Our media needs to copy France 24, ... and have real debates about real issues. What we get is
along the lines of ignoring the problem then attacking any effort to correct. for example, the
media stayed away from the healthcare crisis, too complicated, but damn they are good at criticizing.
A seriously shameful article. Krugman has been a booster of trade & globalization for 30 years:
marginally more nuanced than the establishment, but still a booster.
Now, the establishment has what it wanted and the effects have been disastrous for those not
in the top 20 percent of the income distribution.
At this stage, comes insult to injury. Establishment economists (like Mr. Krugman) can reinvent
themselves with "brilliant new studies" showing the costs and damage of globalization. They pay
no professional costs for the grievous injuries inflicted; there is no mention of the fact that
critical outsider economists have been predicting and writing about these injuries and were right;
and they blithely say we must stay the course because we are locked-in and have few options.
Krugman is not Greg Mankiw. Most people who actually get international economics (Mankiw does
not) are not of the free trade benefits all types. Paul Samuelson certainly does not buy into
Mankiw's spin. Funny thing - Mankiw recently cited an excellent piece from Samuelson only to dishonestly
suggest Samuelson did not believe in what he wrote.
Why are you mischaracterizing what Krugman has written? That's my point. Oh wait - you misrepresent
what people write so you can "win" a "debate". Never mind. Please proceed with the serial dishonesty.
"The truth is that if Sanders were to make it to the White House, he would find it very hard to
do anything much about globalization - not because it's technically or economically impossible,
but because the moment he looked into actually tearing up existing trade agreements the diplomatic,
foreign-policy costs would be overwhelmingly obvious. In this, as in many other things, Sanders
currently benefits from the luxury of irresponsibility: he's never been anywhere close to the
levers of power, so he could take principled-sounding but arguably feckless stances in a way that
Clinton couldn't and can't."
As Dean Baker says, we need to confront Walmart and Goldman Sachs at home, who like these policies,
more than the Chinese.
The Chinese want access to our consumer market. They'd also like if we did't invade countries
like Iraq.
"so he could take principled-sounding but arguably feckless stances in a way that Clinton couldn't"
And what is that? Tear up trade deals? It is Krugman who is engaging in straw man arguments.
Krugman does indeed misrepresent Sanders' positions on trade. Sander is not against trade, he
merely insists on *Fair Trade*, which incorporates human rights and environmental protections.
His opposition is to the kinds of deals, like NAFTA and TPP, which effectively gut those (a central
element in Kruman's own critique of the latter).
Krugman has definitely backed off his (much) earlier boosterism and publicly said so. This is
an excellent piece by him, though it does rather downplay his earlier stances a bit. This is one
of the things I especially like about him.
I can get the idea that some people win, some people lose from liberalized trade. But what really
bugs me about the neoliberal trade agenda is that it has been part of a larger set of economically
conservative, laissez faire policies that have exacerbated the damages from trade rather than
offsetting them.
At the same time they were exposing US workers to greater competition from abroad and destroying
and offshoring working class jobs via both trade and liberalized capital flows, the neoliberals
were also doing things like "reinventing government" - that is, shrinking structural government
spending and public investment - and ending welfare. They have done nothing serious about steering
capital and job development efforts toward the communities devastated by the liberalization.
The neoliberal position has seem to come down to "We can't make bourgeois progress without
breaking a few working class eggs."
Agreed! "Krugman has been a booster of trade & globalization for 30 years: marginally more nuanced
than the establishment, but still a booster.'
Now he claims that he saw the light all along! "much of the elite defense of globalization
is basically dishonest: false claims of inevitability, scare tactics (protectionism causes depressions!),
vastly exaggerated claims for the benefits of trade liberalization and the costs of protection,
hand-waving away the large distributional effects that are what standard models actually predict.
I hope, by the way, that I haven't done any of that..."
You would be hard pressed to find any Krugman clips that cited any of those problems in the
past. Far from being an impartial economist, he was always an avid booster of free trade, overlooking
those very downsides that he suddenly decides to confess.
As far as I know, Sanders has not proposed ripping up the existing trade deals. His information
page on trade emphasizes (i) his opposition to these deals when they were first negotiated and
enacted, and (ii) the principles he will apply to the consideration of future trade deals. Much
of his argumentation concerning past deals is put forward to motivate his present opposition to
TPP.
Note also that Sanders connects his discussion of the harms of past trade policy to the Rebuild
America Act. That is, his approach is forward facing. We can't undo most of the past damage by
recreating the old working class economy we wrecked, but we can be aggressive about using government-directed
national investment programs to create new, high-paying jobs in the US.
You could have said the same about the 1920s
We can't undo most of the past damage by recreating the old agrarian class economy we wrecked,
but we can be aggressive about using government-directed national investment programs to create
new, high-paying jobs in the US.
The march of progress:
Mechanization of agriculture with displacement of large numbers of Ag workers.
The rise of factory work and large numbers employed in manufacturing.
Automation of Manufacturing with large displacement of workers engaged in manufacturing.
What do we want our workers to do? This question must be answered at the highest level of society
and requires much government facilitation. The absence of government facilitation is THE problem.
Memo to Paul Krugman - lead with the economics and stay with the economics. His need to get into
the dirty business of politics dilutes what he ends up sensibly writes later on.
""The truth is that if Sanders were to make it to the White House, he would find it very hard
to do anything much about globalization - not because it's technically or economically impossible,
but because the moment he looked into actually tearing up existing trade agreements the diplomatic,
foreign-policy costs would be overwhelmingly obvious. In this, as in many other things, Sanders
currently benefits from the luxury of irresponsibility: he's never been anywhere close to the
levers of power, so he could take principled-sounding but arguably feckless stances in a way that
Clinton couldn't and can't."
Yeah, it's pretty dishonest for Krugman to pretend that Sanders' position is "ripping up the trade
agreements we already have" and then say Sanders is "engaged in a bit of a scam" because he can't
do that. Sanders actual position (trying to stop new trade deals like the TPP) is something the
president has a lot of influence over (they can veto the deal). Hard to tell what Krugman is doing
here other than deliberately spreading misinformation.
Also worth noting that he decides to compare Sanders' opposition to trade deals with Trump,
and ignore the fact that Clinton has come out against the TPP as well .
Busy with real life, but yes, I know what happened in the primaries yesterday. Triumph for
Trump, and big upset for Sanders - although it's still very hard to see how he can catch Clinton.
Anyway, a few thoughts, not about the horserace but about some deeper currents.
The Sanders win defied all the polls, and nobody really knows why. But a widespread guess is
that his attacks on trade agreements resonated with a broader audience than his attacks on Wall
Street; and this message was especially powerful in Michigan, the former auto superpower. And
while I hate attempts to claim symmetry between the parties - Trump is trying to become America's
Mussolini, Sanders at worst America's Michael Foot * - Trump has been tilling some of the same
ground. So here's the question: is the backlash against globalization finally getting real political
traction?
You do want to be careful about announcing a political moment, given how many such proclamations
turn out to be ludicrous. Remember the libertarian moment? The reformocon moment? Still, a protectionist
backlash, like an immigration backlash, is one of those things where the puzzle has been how long
it was in coming. And maybe the time is now.
The truth is that if Sanders were to make it to the White House, he would find it very hard
to do anything much about globalization - not because it's technically or economically impossible,
but because the moment he looked into actually tearing up existing trade agreements the diplomatic,
foreign-policy costs would be overwhelmingly obvious. In this, as in many other things, Sanders
currently benefits from the luxury of irresponsibility: he's never been anywhere close to the
levers of power, so he could take principled-sounding but arguably feckless stances in a way that
Clinton couldn't and can't.
But it's also true that much of the elite defense of globalization is basically dishonest:
false claims of inevitability, scare tactics (protectionism causes depressions! ** ), vastly exaggerated
claims for the benefits of trade liberalization and the costs of protection, hand-waving away
the large distributional effects that are what standard models actually predict. I hope, by the
way, that I haven't done any of that; I think I've always been clear that the gains from globalization
aren't all that (here's a back-of-the-envelope on the gains from hyperglobalization *** - only
part of which can be attributed to policy - that is less than 5 percent of world GDP over a generation);
and I think I've never assumed away the income distribution effects.
Furthermore, as Mark Kleiman sagely observes, **** the conventional case for trade liberalization
relies on the assertion that the government could redistribute income to ensure that everyone
wins - but we now have an ideology utterly opposed to such redistribution in full control of one
party, and with blocking power against anything but a minor move in that direction by the other.
So the elite case for ever-freer trade is largely a scam, which voters probably sense even
if they don't know exactly what form it's taking.
Ripping up the trade agreements we already have would, again, be a mess, and I would say that
Sanders is engaged in a bit of a scam himself in even hinting that he could do such a thing. Trump
might actually do it, but only as part of a reign of destruction on many fronts.
But it is fair to say that the case for more trade agreements - including Trans-Pacific Partnership,
which hasn't happened yet - is very, very weak. And if a progressive makes it to the White House,
she should devote no political capital whatsoever to such things.
Michael Mackintosh Foot (1913 – 2010) was a British Labour Party politician and man of letters
who was a Member of Parliament (MP) from 1945 to 1955 and from 1960 until 1992. He was Deputy
Leader of the Labour Party from 1976 to 1980, and later the Leader of the Labour Party and Leader
of the Opposition from 1980 to 1983.
Associated with the left of the Labour Party for most of his career, Foot was an ardent supporter
of the Campaign for Nuclear Disarmament and British withdrawal from the European Economic Community.
He was appointed to the Cabinet as Secretary of State for Employment under Harold Wilson in 1974,
and he later served as Leader of the House of Commons under James Callaghan. A passionate orator,
he led Labour through the 1983 general election, when the party obtained its lowest share of the
vote at a general election since 1918 and the fewest parliamentary seats it had had at any time
since before 1945.
There was so much wrong with Mitt Romney's Trump-is-a-disaster-whom-I-will-support-in-the-general
* speech that it may seem odd to call him out for bad international macroeconomics. But this is
a pet peeve of mine, in an area where I really, truly know what I'm talking about. So here goes.
In warning about Trumponomics, Romney declared:
"If Donald Trump's plans were ever implemented, the country would sink into prolonged recession.
A few examples. His proposed 35 percent tariff-like penalties would instigate a trade war and
that would raise prices for consumers, kill our export jobs and lead entrepreneurs and businesses
of all stripes to flee America."
After all, doesn't everyone know that protectionism causes recessions? Actually, no. There
are reasons to be against protectionism, but that's not one of them.
Think about the arithmetic (which has a well-known liberal bias). Total final spending on domestically
produced goods and services is
Total domestic spending + Exports – Imports = GDP
Now suppose we have a trade war. This will cut exports, which other things equal depresses
the economy. But it will also cut imports, which other things equal is expansionary. For the world
as a whole, the cuts in exports and imports will by definition be equal, so as far as world demand
is concerned, trade wars are a wash.
OK, I'm sure some people will start shouting "Krugman says protectionism does no harm." But
no: protectionism in general should reduce efficiency, and hence the economy's potential output.
But that's not at all the same as saying that it causes recessions.
But didn't the Smoot-Hawley tariff cause the Great Depression? No. There's no evidence at all
that it did. Yes, trade fell a lot between 1929 and 1933, but that was almost entirely a consequence
of the Depression, not a cause. (Trade actually fell faster ** during the early stages of the
2008 Great Recession than it did after 1929.) And while trade barriers were higher in the 1930s
than before, this was partly a response to the Depression, partly a consequence of deflation,
which made specific tariffs (i.e. tariffs that are stated in dollars per unit, not as a percentage
of value) loom larger.
Again, not the thing most people will remember about Romney's speech. But, you know, protectionism
was the only reason he gave for believing that Trump would cause a recession, which I think is
kind of telling: the GOP's supposedly well-informed, responsible adult, trying to save the party,
can't get basic economics right at the one place where economics is central to his argument.
The Gains From Hyperglobalization (Wonkish)
By Paul Krugman
Still taking kind of an emotional vacation from current political madness. Following up on
my skeptical post on worries about slowing trade growth, * I wondered what a state-of-the-art
model would say.
The natural model to use, at least for me, is Eaton-Kortum, ** which is a very ingenious approach
to thinking about multilateral trade flows. The basic model is Ricardian - wine and cloth and
labor productivity and all that - except that there are many goods and many countries, transportation
costs, and countries are assumed to gain productivity in any particular industry through a random
process. They make some funny assumptions about distributions - hey, that's kind of the price
of entry for this kind of work - and in return get a tractable model that yields gravity-type
equations for international trade flows. This is a good thing, because gravity models *** of trade
- purely empirical exercises, with no real theory behind them - are known to work pretty well.
Their model also yields a simple expression for the welfare gains from trade:
Real income = A*(1-import share)^(-1/theta)
where A is national productivity and theta is a parameter of their assumed random process (don't
ask); they suggest that theta=4 provides the best match to available data.
Now, what I wanted to do was apply this to the rapid growth of trade that has taken place since
around 1990, what Subramanian **** calls "hyperglobalization". According to Subramanian's estimates,
overall trade in goods and services has risen from about 19 percent of world GDP in the early
1990s to 33 percent now, bringing us to a level of integration that really is historically unprecedented.
There are some conceptual difficulties with using this rise directly in the Eaton-Kortum framework,
because much of it has taken the form of trade in intermediate goods, and the framework isn't
designed to handle that. Still, let me ignore that, and plug Subramanian's numbers into the equation
above; I get a 4.9 percent rise in real incomes due to increased globalization.
That's by no means small change, but it's only a fairly small fraction of global growth. The
Maddison database ***** gives us a 45 percent rise in global GDP per capita over the same period,
so this calculation suggests that rising trade was responsible for around 10 percent of overall
global growth. My guess is that most people who imagine themselves well-informed would give a
bigger number.
By the way, for those critical of globalization, let me hasten to concede that by its nature
the Eaton-Kortum model doesn't let us talk about income distribution, and it also makes no room
for the possible role of globalization in causing secular stagnation. ******
Still, I thought this was an interesting calculation to make - which may show more about my
warped sense of what's interesting than it does about anything else.
General Equilibrium Analysis of the Eaton-Kortum Model of International Trade
By Fernando Alvarez and Robert E. Lucas
We study a variation of the Eaton-Kortum model, a competitive, constant-returns-to-scale multicountry
Ricardian model of trade. We establish existence and uniqueness of an equilibrium with balanced
trade where each country imposes an import tariff. We analyze the determinants of the cross-country
distribution of trade volumes, such as size, tariffs and distance, and compare a calibrated version
of the model with data for the largest 60 economies. We use the calibrated model to estimate the
gains of a world-wide trade elimination of tariffs, using the theory to explain the magnitude
of the gains as well as the differential effect arising from cross-country differences in pre-liberalization
of tariffs levels and country size.
The gravity model of international trade in international economics, similar to other gravity
models in social science, predicts bilateral trade flows based on the economic sizes (often using
GDP measurements) and distance between two units. The model was first used by Jan Tinbergen in
1962.
The Hyperglobalization of Trade and Its Future
By Arvind Subramanian and Martin Kessler
Abstract
The open, rules-based trading system has delivered immense benefits-for the world, for individual
countries, and for average citizens in these countries. It can continue to do so, helping today's
low-income countries make the transition to middle-income status. Three challenges must be met
to preserve this system. Rich countries must sustain the social consensus in favor of open markets
and globalization at a time of considerable economic uncertainty and weakness; China and other
middle-income countries must remain open; and mega-regionalism must be prevented from leading
to discrimination and trade conflicts. Collective action should help strengthen the institutional
underpinnings of globalization. The world should move beyond the Doha Round dead to more meaningful
multilateral negotiations to address emerging challenges, including possible threats from new
mega-regional agreements. The rising powers, especially China, will have a key role to play in
resuscitating multilateralism.
"Furthermore, as Mark Kleiman sagely observes, the conventional case for trade liberalization
relies on the assertion that the government could redistribute income to ensure that everyone
wins"
That was never the conventional case for trade. Plus it's kind of odd that you have to add
"plus have the government redistribute" to the case your making.
Tom Pally above is correct. Krugman has been on the wrong side of this issue. He's gotten better,
but the timing is he's gotten better as the Democratic Party has moved to the left and pushed
back against corporate trade deals. Even Hillary came out late against Obama's TPP.
Sanders has nothing about ripping up trade deals. He has said he won't do any more.
As cawley predicted, once Sanders won Michigan, Krugman started hitting him again at his blog.
With cheap shots I might add. He's ruining his brand.
Tell Morning Edition: It's Not "Free Trade" Folks
by Dean Baker
Published: 10 March 2016
Hey, can an experienced doctor from Germany show up and start practicing in New York next week?
Since the answer is no, we can say that we don't have free trade. It's not an immigration issue,
if the doctor wants to work in a restaurant kitchen, she would probably get away with it. We have
protectionist measures that limit the number of foreign doctors in order to keep their pay high.
These protectionist measures have actually been strengthened in the last two decades.
We also have strengthened patent and copyright protections, making drugs and other affected
items far more expensive. These protections are also forms of protectionism.
This is why Morning Edition seriously misled its listeners in an interview with ice cream barons
Ben Cohen and Jerry Greenfield over their support of Senator Bernie Sanders. The interviewer repeatedly
referred to "free trade" agreements and Sanders' opposition to them. While these deals are all
called "free trade" deals to make them sound more palatable ("selective protectionism to redistribute
income upward" doesn't sound very appealing), that doesn't mean they are actually about free trade.
Morning Edition should not have used the term employed by promoters to push their trade agenda.
This has been Dean Baker's excellent theme for a very long time. And if you actually paid attention
to what Krugman said about TPP - he agreed with Dean's excellent points. But do continue to set
up straw man arguments so you can dishonestly attack Krugman.
No. That is not a sign of a faulty memory, quite the contrary.
Krugman writes column after column praising trade pacts and criticizing (rightly, I might add)
the yahoos who object for the wrong reasons.
But he omits a few salient facts like
- the gains are small,
- the government MUST intervene with redistribution for this to work socially,
- there are no (or minimal) provisions for that requirement in the pacts.
I would say his omissions speak volumes and are worth remembering.
Krugman initially wrote a confused column about the TPP, treating it as a simple free trade deal
which he said would have little impact because tariffs were already so low. But he did eventually
look into the matter further and wound up agreeing with Baker's take.
"That was never the conventional case for trade". Actually it was. Of course Greg Mankiw never
got the memo so his free trade benefits all BS confuses a lot of people. Mankiw sucks at international
trade.
David Glasner attacks Krugman from the right, but he doesn't whitewash the past as you do.
He remembers Gore versus Perot:
"Indeed, Romney didn't even mention the Smoot-Hawley tariff, but Krugman evidently forgot the
classic exchange between Al Gore and the previous incarnation of protectionist populist outrage
in an anti-establishment billionaire candidate for President:
GORE I've heard Mr. Perot say in the past that, as the carpenters says, measure twice and cut
once. We've measured twice on this. We have had a test of our theory and we've had a test of his
theory. Over the last five years, Mexico's tariffs have begun to come down because they've made
a unilateral decision to bring them down some, and as a result there has been a surge of exports
from the United States into Mexico, creating an additional 400,000 jobs, and we can create hundreds
of thousands of more if we continue this trend. We know this works. If it doesn't work, you know,
we give six months notice and we're out of it. But we've also had a test of his theory.
PEROT When?
GORE In 1930, when the proposal by Mr. Smoot and Mr. Hawley was to raise tariffs across the
board to protect our workers. And I brought some pictures, too.
[Larry] KING You're saying Ross is a protectionist?
GORE This is, this is a picture of Mr. Smoot and Mr. Hawley. They look like pretty good fellows.
They sounded reasonable at the time; a lot of people believed them. The Congress passed the Smoot-Hawley
Protection Bill. He wants to raise tariffs on Mexico. They raised tariffs, and it was one of the
principal causes, many economists say the principal cause, of the Great Depression in this country
and around the world. Now, I framed this so you can put it on your wall if you want to.
You obviously have not read Krugman. Here is from his 1997 Slate piece:
But putting Greenspan (or his successor) into the picture restores much of the classical vision
of the macroeconomy. Instead of an invisible hand pushing the economy toward full employment in
some unspecified long run, we have the visible hand of the Fed pushing us toward its estimate
of the noninflationary unemployment rate over the course of two or three years. To accomplish
this, the board must raise or lower interest rates to bring savings and investment at that target
unemployment rate in line with each other.
And so all the paradoxes of thrift, widow's cruses, and so on become irrelevant. In particular,
an increase in the savings rate will translate into higher investment after all, because the Fed
will make sure that it does.
To me, at least, the idea that changes in demand will normally be offset by Fed policy--so
that they will, on average, have no effect on employment--seems both simple and entirely reasonable.
Yet it is clear that very few people outside the world of academic economics think about things
that way. For example, the debate over the North American Free Trade Agreement was conducted almost
entirely in terms of supposed job creation or destruction. The obvious (to me) point that the
average unemployment rate over the next 10 years will be what the Fed wants it to be, regardless
of the U.S.-Mexico trade balance, never made it into the public consciousness. (In fact, when
I made that argument at one panel discussion in 1993, a fellow panelist--a NAFTA advocate, as
it happens--exploded in rage: "It's remarks like that that make people hate economists!")
Yes. But please do not interrupt PeterK with reality. He has important work do with his bash all
things Krugman agenda. BTW - it is a riot that he cites Ross Perot on NAFTA. Perot has a self
centered agenda there which Gore exposed. Never trust a corrupt business person whether it is
Perot or Trump.
Yes the model PeterK is using is unclear. He doesn't seem to have a grasp on the economics of
the issues. He seems to think that Sanders is a font of economic wisdom who is not to be questioned.
I would hate to see the left try to make a flawed candidate into the larger than life icon that
the GOP has made out of Reagan.
"Yes the model PeterK is using is unclear. He doesn't seem to have a grasp on the economics of
the issues."
Dean Baker and Jared Bernstein. Like you I want full employment and rising wages. And like
Krugman I am very much an internationalist. I want us to deal fairly with the rest of the world.
We need to cooperate especially in the face of global warming.
1. My first, best solution would be fiscal action. Like everyone else. I prefer Sanders's unicorn
plan of $1 trillion over five years rather than Hillary's plan which is one quarter of the size.
Her plan puts more pressure on the Fed and monetary policy.
a. My preference would be to pay for it with Pigouvian taxes on the rich, corporations, and
the financial sector.
b. if not a, then deficit spending like Trudeau in Canada
C. if the deficit hawks block that, then monetary-financing would be the way around them.
2. close the trade deficit. Dean Baker and Bernstein have written about this a lot. Write currency
agreements into trade deals. If we close the trade deficit and are at full employment, then we
can import more from the rest of the world.
3. If powerful interests block 1. and 2. then lean on monetary policy. Reduce the price of
credit to boost demand. It works as a last resort.
"I would hate to see the left try to make a flawed candidate into the larger than life icon
that the GOP has made out of Reagan.'
I haven't seen any evidence of this. It would be funny if the left made an old Jewish codger
from Brooklyn into an icon. Feel the Bern!!!
Sanders regularly points out it's not about him as President fixing everything, it's about
creating a movement. It's about getting people involved. He can't do it by himself. Obama would
say this too. Elizabeth Warren become popular by saying the same things Sanders is saying.
However to say that the conventional case for trade liberalization relies on the Compensation
Principle isn't quite accurate. The conventional case has traditionally relied on the assertion
that "we" are better off with trade since we could *theoretically* distribute the gains. However,
free trade boosters never seem to get around to worrying about distributing the gains *in practice*.
In practice, free trade is typically justified simply by the net aggregate gain, regardless of
how these gains are distributed or who is hurt in the process.
To my mind, before considering some trade liberalization deal we should FIRST agree to and
implement the redistribution mechanisms and only then reduce barriers. Implementing trade deals
in a backward, half-assed way as has typically been the case often makes "us" worse off than autarky.
"Krugman has at times advocated free markets in contexts where they are often viewed as controversial.
He has ... likened the opposition against free trade and globalization to the opposition against
evolution via natural selection (1996),[167]
(In fact, when I made that argument at one panel discussion in 1993, a fellow panelist--a NAFTA
advocate, as it happens--exploded in rage: "It's remarks like that that make people hate economists!")
[Thanks to electoral politics, we're all fellow panelists now.]
"To me, at least, the idea that changes in demand will normally be offset by Fed policy--so that
they will, on average, have no effect on employment--seems both simple and entirely reasonable.
Yet it is clear that very few people outside the world of academic economics think about things
that way."
As we've seen the Fed is overly fearful of inflation, so the Fed doesn't offset the trade deficit
as quickly as it should. Instead we suffer hysteresis and reduction of potential output.
"The truth is that if Sanders were to make it to the White House, he would find it very hard to
do anything much about globalization - not because it's technically or economically impossible,
but because the moment he looked into actually tearing up existing trade agreements the diplomatic,
foreign-policy costs would be overwhelmingly obvious."
Here Krugman is more honest. We're basically buying off the Chinese, etc. The cost for stopping
this would be less cooperation from the Chinese, etc.
This is new. He never used to say this kind of thing. Instead he'd go after "protectionists"
as luddites.
"This is new. He never used to say this kind of thing. Instead he'd go after "protectionists"
as luddites."
You have Krugman confused with Greg Mankiw. Most real international economics (Mankiw is not
one) recognize the distributional consequences of free trade v. protectionism. Then again - putting
forth the Mankiw uninformed spin is a prerequisite for being on Team Republican. Of course Republicans
will go protectionist whenever it is politically expedient as in that temporary set of steel tariffs.
Helped Bush-Cheney in 2004 and right after that - no tariffs. Funny how that worked.
Where is the "redistribution from government" in the TPP. There isn't any.
Even the NAFTA side agreements on labor and the environment are toothless. The point of these
corporate trade deals is to profit from the lower labor and environmental standards of poorer
countries.
The fact that you resort to calling me a professional Krugman hater means you're not interested
in an actual debate about actual ideas. You've lost the debate and I'm not participating.
One is not allowed to criticize Krugman lest one be labeled a professional Krugman hater?
Your resort to name calling just weakens the case you're making.
You of late have wasted so much space misrepresenting what Krugman has said. Maybe you don't hate
him - maybe you just want to get his attention. For a date maybe. Lord - the troll in you is truly
out of control.
Sandwichman may think Krugman changed his views but if one actually read what he has written over
the years (as opposed to your cherry picking quotes), you might have noticed otherwise. But of
course you want Krugman to look bad. It is what you do.
Sizeable numbers of Americans have seen wages decline in real terms for nearly 20 years. Many/most
parents in many communities do not see a better future before them, or for their children.
Notable quotes:
"... Democracy demands that ballot access rules be selected by referendum, not by the very legacy parties that maintain legislative control by effectively denying ballot access to parties that will pose a challenge to their continued rule. ..."
"... I think the U.S. Party system, in the political science sense, shifted to a new state during George W Bush's administration as, in Kevin Phillip's terms the Republican Party was taken over by Theocrats and Bad Money. ..."
"... My understanding is trumps support disproportionately comes from the small business owning classes, Ie a demographic similar to the petite bourgeoisie who have often been heavily involved in reactionary movements. This gets oversold as "working class" when class is defined by education level rather than income. ..."
"... Racism serves as an organizing principle. Politically, in an oppressive and stultifying hierarchy like the plantation South, racism not incidentally buys the loyalty of subalterns with ersatz status. ..."
"... For a time, the balkanization of American political communities by race, religion and ethnicity was an effective means to the dominance of an tiny elite with ties to an hegemonic community, but it backfired. Dismantling that balkanization has left the country with a very low level of social affiliation and thus a low capacity to organize resistance to elite depredations. ..."
"... Watching Clinton scoop up bankster money, welcome Republicans neocons to the ranks of her supporters does not fill me with hope. ..."
Legislators affiliated with the duopoly parties should not write the rules governing the ballot
access of third parties. This exclusionary rule making amounts to preserving a self-dealing duopoly.
Elections are the interest of the people who vote and those elected should not be able to subvert
the democratic process by acting as a cartel.
Democracy demands that ballot access rules be selected by referendum, not by the very legacy
parties that maintain legislative control by effectively denying ballot access to parties that
will pose a challenge to their continued rule.
Of course any meaningful change would require a voluntary diminishment of power of the duopoly
that now has dictatorial control over ballot access, and who will prevent any Constitutional Amendment
that would enhance the democratic nature of the process.
bruce wilder 08.02.16 at 8:02 pm
I think the U.S. Party system, in the political science sense, shifted to a new state during
George W Bush's administration as, in Kevin Phillip's terms the Republican Party was taken over
by Theocrats and Bad Money.
Ronan(rf) 08.04.16 at 10:35 pm
"I generally don't give a shit about polls so I have no "data" to evidence this claim,
but my guess is the majority of Trump's support comes from this broad middle"
My understanding is trumps support disproportionately comes from the small business owning
classes, Ie a demographic similar to the petite bourgeoisie who have often been heavily involved
in reactionary movements. This gets oversold as "working class" when class is defined by education
level rather than income.
This would make some sense as they are generally in economically unstable jobs, they tend to
be hostile to both big govt (regulations, freeloaders) and big business (unfair competition),
and while they (rhetorically at least) tend to value personal autonomy and self sufficiency ,
they generally sell into smaller, local markets, and so are particularly affected by local demographic
and cultural change , and decline. That's my speculation anyway.
bruce wilder 08.06.16 at 4:28 pm
I am somewhat suspicious of leaving dominating elites out of these stories of racism as an
organizing principle for political economy or (cultural) community.
Racism served the purposes of a slaveholding elite that organized political communities to
serve their own interests. (Or, vis a vis the Indians a land-grab or genocide.)
Racism serves as an organizing principle. Politically, in an oppressive and stultifying
hierarchy like the plantation South, racism not incidentally buys the loyalty of subalterns with
ersatz status. The ugly prejudices and resentful arrogance of working class whites is thus
a component of how racism works to organize a political community to serve a hegemonic master
class. The business end of racism, though, is the autarkic poverty imposed on the working communities:
slaves, sharecroppers, poor blacks, poor whites - bad schools, bad roads, politically disabled
communities, predatory institutions and authoritarian governments.
For a time, the balkanization of American political communities by race, religion and ethnicity
was an effective means to the dominance of an tiny elite with ties to an hegemonic community,
but it backfired. Dismantling that balkanization has left the country with a very low level of
social affiliation and thus a low capacity to organize resistance to elite depredations.
bruce wilder 08.06.16 at 4:31 pm
Watching Clinton scoop up bankster money, welcome Republicans neocons to the ranks of her
supporters does not fill me with hope.
Trump and the other illiberal populists have been benefiting from three overlapping backlashes.
The first is cultural. Movements for civil liberties have been remarkably successful over the
last 40 years. Women, ethnic and religious minorities, and the LGBTQ community have secured important
gains at a legal and cultural level. It is remarkable, for instance, how quickly same-sex marriage
has become legal in more than 20 countries when no country recognized it before 2001.
Resistance has always existed to these movements to expand the realm of civil liberties. But this
backlash increasingly has a political face. Thus the rise of parties that challenge multiculturalism
and immigration in Europe, the movements throughout Africa and Asia that support the majority over
the minorities, and the Trump/Tea Party takeover of the Republican Party with their appeals to primarily
white men.
The second backlash is economic. The globalization of the economy has created a class of enormously
wealthy individuals (in the financial, technology, and communications sectors). But globalization
has left behind huge numbers of low-wage workers and those who have watched their jobs relocate to
other countries.
Illiberal populists have directed all that anger on the part of people left behind by the world
economy at a series of targets: bankers who make billions, corporations that are constantly looking
for even lower-wage workers, immigrants who "take away our jobs," and sometimes ethnic minorities
who function as convenient scapegoats. The targets, in other words, include both the very powerful
and the very weak.
The third backlash, and perhaps the most consequential, is political. It's not just that people
living in democracies are disgusted with their leaders and the parties they represent. Rather, as
political scientists Roberto Stefan Foa and Yascha Mounk
write in the Journal of Democracy , "they have also become more cynical about the value
of democracy as a political system, less hopeful that anything they do might influence public policy,
and more willing to express support for authoritarian alternatives."
Foa and Mounk are using 20 years of data collected from surveys of citizens in Western Europe
and North America – the democracies with the greatest longevity. And they have found that support
for illiberal alternatives is greater among the younger generation than the older one. In other countries
outside Europe and North America, the disillusionment with democratic institutions often takes the
form of a preference for a powerful leader who can break the rules if necessary to preserve order
and stability – like Putin in Russia or Abdel Fattah el-Sisi in Egypt or Prayuth Chan-ocha in Thailand.
These three backlashes – cultural, economic, political – are also anti-internationalist because
international institutions have become associated with the promotion of civil liberties and human
rights, the greater globalization of the economy, and the constraint of the sovereignty of nations
(for instance, through the European Union or the UN's "responsibility to protect" doctrine).
... ... ....
The current political order is coming apart. If we don't come up with a fair, Green, and internationalist
alternative, the illiberal populists will keep winning. John Feffer is the director of Foreign
Policy In Focus.
"... if neo-liberalism is partly defined by the free flow of goods, labor and capital - and that has been the Republican agenda since at least Reagan - how is Trump a continuation of the same tradition?" ..."
"... Trump is a conservative (or right populist, or whatever), and draws on that tradition. He's not a neoliberal. ..."
"... Trump is too incoherent to really represent the populist view. He's consistent w/the trade and immigration views but (assuming you can actually figure him out) wrong on banks, taxes, etc. ..."
"... But the next populists we see might be more full bore. When that happens, you'll see much more overlap w/Sanders economic plans for the middle class. ..."
"... There's always tension along the lead running between the politician and his constituents. The thing that seems most salient to me at the present moment is the sense of betrayal pervading our politics. At least since the GFC of 2008, it has been hard to deny that the two Parties worked together to set up an economic betrayal. And, the long-running saga of the wars in Iraq and Afghanistan also speak to elite failure, as well as betrayal. ..."
"... Trump is a novelty act. He represents a chance for people who feel resentful without knowing much of anything about anything to cast a middle-finger vote. They wouldn't be willing to do that, if times were really bad, instead of just disappointing and distressing. ..."
"... There's also the fact Reagan tapped a fair number of Nixon people, as did W years later. Reagan went after Nixon in the sense of running against him, and taking the party in a much more hard-right direction, sure. But he was repudiated largely because he got caught doing dirty tricks with his pants down. ..."
"... From what I can tell - the 1972 election gave the centrists in the democratic party power to discredit and marginalize the anti-war left, and with it, the left in general. ..."
"... Ready even now to whine that she's a victim and that the whole community is at fault and that people are picking on her because she's a woman, rather than because she has a habit of making accusations like this every time she comments. ..."
"... That is a perfect example of predatory "solidarity". Val is looking for dupes to support her ..."
"Once again, if neo-liberalism is partly defined by the free flow of goods, labor and capital
- and that has been the Republican agenda since at least Reagan - how is Trump a continuation
of the same tradition?"
You have to be willing to see neoliberalism as something different
from conservatism to have the answer make any sense. John Quiggin has written a good deal here
about a model of U.S. politics as being divided into left, neoliberal, and conservative. Trump
is a conservative (or right populist, or whatever), and draws on that tradition. He's not a neoliberal.
... ... ...
T 08.12.16 at 5:52 pm
RP @683
That's a bit of my point. I think Corey has defined the Republican tradition solely
in response to the Southern Strategy that sees a line from Nixon (or Goldwater) to Trump. But
that gets the economics wrong and the foreign policy too - the repub foreign policy view has not
been consistent across administrations and Trump's economic pans (to the extent he has a plan)
are antithetical to the Nixon – W tradition. I have viewed post-80 Dem administrations as neoliberals
w/transfers and Repub as neoliberals w/o transfers.
Trump is too incoherent to really represent the populist view. He's consistent w/the trade
and immigration views but (assuming you can actually figure him out) wrong on banks, taxes, etc.
But the next populists we see might be more full bore. When that happens, you'll see much
more overlap w/Sanders economic plans for the middle class. Populists have nothing against
gov't programs like SS and Medicare and were always for things like the TVA and infrastructure
spending. Policies aimed at the poor and minorities not so much.
T @ 685: Trump is too incoherent to really represent the populist view.
There's always tension along the lead running between the politician and his constituents.
The thing that seems most salient to me at the present moment is the sense of betrayal pervading
our politics. At least since the GFC of 2008, it has been hard to deny that the two Parties worked
together to set up an economic betrayal. And, the long-running saga of the wars in Iraq and Afghanistan
also speak to elite failure, as well as betrayal.
These are the two most unpopular candidates in living memory. That is different.
I am not a believer in "the fire next time". Trump is a novelty act. He represents a chance
for people who feel resentful without knowing much of anything about anything to cast a middle-finger
vote. They wouldn't be willing to do that, if times were really bad, instead of just disappointing
and distressing.
Nor will Sanders be back. His was a last New Deal coda. There may be second acts in American
life, but there aren't 7th acts.
If there's a populist politics in our future, it will have to have a much sharper edge. It
can talk about growth, but it has to mean smashing the rich and taking their stuff. There's very
rapidly going to come a point where there's no other option, other than just accepting cramdown
by the authoritarian surveillance state built by the neoliberals. that's a much taller order than
Sanders or Trump have been offering.<
Corey, you write: "It's not just that the Dems went after Nixon, it's also that Nixon had so few
allies. People on the right were furious with him because they felt after this huge ratification
that the country had moved to the right, Nixon was still governing as if the New Deal were the
consensus. So when the time came, he had very few defenders, except for loyalists like Leonard
Garment and G. Gordon Liddy. And Al Haig, God bless him."
You've studied this more than I have,
but this is at least somewhat at odds with my memory. I recall some prominent attackers of Nixon
from the Republican party that were moderates, at least one of whom was essentially kicked out
of the party for being too liberal in later years. There's also the fact Reagan tapped a fair
number of Nixon people, as did W years later. Reagan went after Nixon in the sense of running
against him, and taking the party in a much more hard-right direction, sure. But he was repudiated
largely because he got caught doing dirty tricks with his pants down.
To think that something similar would happen to Clinton (watergate like scandal) that would
actually have a large portion of the left in support of impeachment, she would have to be as dirty
as Nixon was, *and* the evidence to really put the screws to her would have to be out, as it was
against Nixon during watergate.
OTOH, my actual *hope* would be that a similar left-liberal sea change comparable to 1980 from
the right would be plausible. I don't think a 1976-like interlude is plausible though, that would
require the existence of a moderate republican with enough support within their own party to win
the nomination. I suppose its possible that such a beast could come to exist if Trump loses a
landslide, but most of the plausible candidates have already left or been kicked out of the party.
From what I can tell - the 1972 election gave the centrists in the democratic party power
to discredit and marginalize the anti-war left, and with it, the left in general. A comparable
election from the other side would give republican centrists/moderates the ability to discredit
and marginalize the right wing base. But unlike Democrats in 1972, there aren't any moderates
left in the Republican party by my lights. I'm much more concerned that this will simply re-empower
the hard-core conservatives with plausbly-deniable dog-whistle racism who are now the "moderates",
and enable them to whitewash their history.
Unfortunately, unlike you, I'm not convinced that a landslide is possible without an appeal
to Reagan/Bush republicans. I don't think we're going to see a meaningful turn toward a real left
until Democrats can win a majority of statehouses and clean up the ridiculous gerrymandering.
Val: "Similarly with your comments on "identity politics" where you could almost be seen
by MRAs and white supremacists as an ally, from the tone of your rhetoric."
That is 100% perfect Val. Insinuates that BW is a sort-of-ally of white supremacists - an infuriating
insinuation. Does this insinuation based on a misreading of what he wrote. Completely resistant
to any sort of suggestion that what she dishes out so expansively to others had better be something
she should be willing to accept herself, or that she shouldn't do it. Ready even now to whine
that she's a victim and that the whole community is at fault and that people are picking on her
because she's a woman, rather than because she has a habit of making accusations like this every
time she comments.
That is a perfect example of predatory "solidarity". Val is looking for dupes to support
her - for people to jump in saying "Why are you being hostile to women?" in response to people's
response to her comment.
"... More than a dozen Republican rivals, described as the strongest GOP field since 1980, were sent packing. This was the year Americans rose up to pull down the establishment in a peaceful storming of the American Bastille. ..."
"... If 2016 taught us anything, it is that if the establishment's hegemony is imperiled, it will come together in ferocious solidarity - for the preservation of their perks, privileges and power. All the elements of that establishment - corporate, cultural, political, media - are today issuing an ultimatum to Middle America: Trump is unacceptable. Instructions are going out to Republican leaders that either they dump Trump, or they will cease to be seen as morally fit partners in power. ..."
"... Our CIA, NGOs and National Endowment for Democracy all beaver away for "regime change" in faraway lands whose rulers displease us. How do we effect "regime change" here at home? ..."
"... Donald Trump's success, despite the near-universal hostility of the media, even much of the conservative media, was due in large part to the public's response to the issues he raised. ..."
"I'm afraid the election is going to be rigged," Donald Trump told voters
in Ohio and Sean Hannity on Fox News. And that hit a nerve.
"Dangerous," "toxic," came the recoil from the media.
Trump is threatening to "delegitimize" the election results of 2016.
Well, if that is what Trump is trying to do, he has no small point. For consider
what 2016 promised and what it appears about to deliver.
This longest of election cycles has rightly been called the Year of the Outsider.
It was a year that saw a mighty surge of economic populism and patriotism, a
year when a 74-year-old Socialist senator set primaries ablaze with mammoth
crowds that dwarfed those of Hillary Clinton.
It was the year that a non-politician, Donald Trump, swept Republican primaries
in an historic turnout, with his nearest rival an ostracized maverick in his
own Republican caucus, Senator Ted Cruz.
More than a dozen Republican rivals, described as the strongest GOP field
since 1980, were sent packing. This was the year Americans rose up to pull down
the establishment in a peaceful storming of the American Bastille.
But if it ends with a Clintonite restoration and a ratification of the same
old Beltway policies, would that not suggest there is something fraudulent about
American democracy, something rotten in the state?
If 2016 taught us anything, it is that if the establishment's hegemony
is imperiled, it will come together in ferocious solidarity - for the preservation
of their perks, privileges and power. All the elements of that establishment
- corporate, cultural, political, media - are today issuing an ultimatum to
Middle America: Trump is unacceptable. Instructions are going out to Republican
leaders that either they dump Trump, or they will cease to be seen as morally
fit partners in power.
It testifies to the character of Republican elites that some are seeking
ways to carry out these instructions, though this would mean invalidating and
aborting the democratic process that produced Trump.
But what is a repudiated establishment doing issuing orders to anyone?
Why is it not Middle America issuing the demands, rather than the other way
around?
Specifically, the Republican electorate should tell its discredited and rejected
ruling class: If we cannot get rid of you at the ballot box, then tell us how,
peacefully and democratically, we can be rid of you?
You want Trump out? How do we get you out? The Czechs had their Prague Spring.
The Tunisians and Egyptians their Arab Spring. When do we have our American
Spring? The Brits had their "Brexit," and declared independence of an arrogant
superstate in Brussels. How do we liberate ourselves from a Beltway superstate
that is more powerful and resistant to democratic change?
Our CIA, NGOs and National Endowment for Democracy all beaver away for
"regime change" in faraway lands whose rulers displease us. How do we effect
"regime change" here at home?
Donald Trump's success, despite the near-universal hostility of the media,
even much of the conservative media, was due in large part to the public's response
to the issues he raised.
He called for sending illegal immigrants back home, for securing America's
borders, for no amnesty. He called for an America First foreign policy to
keep us out of wars that have done little but bleed and bankrupt us.
He called for an economic policy where the Americanism of the people
replaces the globalism of the transnational elites and their K Street lobbyists
and congressional water carriers.
He denounced NAFTA, and the trade deals and trade deficits with China,
and called for rejection of the Trans-Pacific Partnership.
By campaign's end, he had won the argument on trade, as Hillary Clinton was
agreeing on TPP and confessing to second thoughts on NAFTA.
But if TPP is revived at the insistence of the oligarchs of Wall Street,
the Business Roundtable, the U.S. Chamber of Commerce - backed by conscript
editorial writers for newspapers that rely on ad dollars - what do elections
really mean anymore?
And if, as the polls show we might, we get Clinton - and TPP, and amnesty,
and endless migrations of Third World peoples who consume more tax dollars than
they generate, and who will soon swamp the Republicans' coalition - what was
2016 all about?
Would this really be what a majority of Americans voted for in this most
exciting of presidential races?
"Those who make peaceful revolution impossible will make violent revolution
inevitable," said John F. Kennedy.
The 1960s and early 1970s were a time of social revolution in America, and
President Nixon, by ending the draft and ending the Vietnam war, presided over
what one columnist called the "cooling of America."
But if Hillary Clinton takes power, and continues America on her present
course, which a majority of Americans rejected in the primaries, there is going
to be a bad moon rising.
And the new protesters in the streets will not be overprivileged children
from Ivy League campuses.
"... the capitalist economy is more and more an asset driven one. This article does not even begin to address the issue of asset valuations, the explicit CB support for asset inflation and the effect on inequality, and especially generational plunder. ..."
"... the problem of living standards is obviously a Malthusian one. despite all the progress of social media tricks, we cannot fool nature. the rate of ecological degradation is alarming, and now irreversible. "the market" is now moving rapidly to real assets. This will eventually lead to war as all war is eventually for resources. ..."
No matter what central banks do, their actions will not be able to create the same level of
economic growth that we have become used to over the past seven decades.
Economic growth does not come from the central banks; if government sought to provide the basics
for all its citizens, including health care, education, a home, and proper food and all the infrastructure
needed to give people the basics, then you could have something akin to "growth" while at the
same time making life more pleasant for the less fortunate. There seems to be no definition of
economic growth that includes everyone.
This seems a very elaborate way of stating a simple problem, that can be summarised in three
points.
The living standards of most people have fallen over the last thirty years or so because of
the impact of neoliberal economic policies. Conventional politicians are promising only more
of the same. Therefore people are increasingly voting for non-conventional politicians.
Neoliberalism has only exacerbated falling living standards. Living standards would be falling
even without it, albeit more gradually.
Neoliberalism itself may even be nothing more than a standard type response of species that
have expanded beyond the capacity of their environment to support them. What we see as an evil
ideology is only the expression of a mechanism that apportions declining resources to the elites,
like shutting shutting down the periphery so the core can survive as in hypothermia.
I really don't have problem with this. Let the financial sector run the world into the ground
and get it over with.
In defference to a great many knowledgable commentors here that work in the FIRE sector, I
don't want to create a damning screed on the cost of servicing money, but at some point even the
most considered opinions have to acknowledge that that finance is flooded with *talent* which
creates a number of problems; one being a waste of intellect and education in a field that doesn't
offer much of a return when viewed in an egalitarian sense, secondly; as the field grows due to,
the technical advances, the rise in globilization, and the security a financial occuptaion offers
in an advanced first world country nowadays, it requires substantially more income to be devoted
to it's function.
This income has to be derived somewhere, and the required sacrifices on every facet of a global
economy to bolster positions and maintain asset prices has precipitated this decline in the well
being of peoples not plugged-in to the consumer capitalist regime and dogma.
Something has to give here, and I honestly couldn't care about your 401k or home resale value,
you did this to yourself as much as those day-traders who got clobbered in the dot-com crash.
the capitalist economy is more and more an asset driven one. This article does not even
begin to address the issue of asset valuations, the explicit CB support for asset inflation and
the effect on inequality, and especially generational plunder.
the problem of living standards is obviously a Malthusian one. despite all the progress
of social media tricks, we cannot fool nature. the rate of ecological degradation is alarming,
and now irreversible. "the market" is now moving rapidly to real assets. This will eventually
lead to war as all war is eventually for resources.
We have just witnessed one of the most significant steps toward a one world
economic system that we have ever seen. Negotiations for the Trans-Pacific Partnership
have been completed, and if approved it will create the largest trading bloc
on the planet. But this is not just a trade agreement. In this treaty, Barack
Obama has thrown in all sorts of things that he never would have been able to
get through Congress otherwise. And once this treaty is approved, it will be
exceedingly difficult to ever make changes to it. So essentially what is happening
is that the Obama agenda is being permanently locked in for 40 percent of the
global economy.
The United States, Canada, Japan, Mexico, Australia, Brunei,
Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam all intend to sign
on to this insidious plan. Collectively, these nations have a total population
of about 800 million people and a combined GDP of approximately 28 trillion
dollars.
In hailing the agreement, Obama said, "Congress and the American people
will have months to read every word" before he signs the deal that he described
as a win for all sides.
"If we can get this agreement to my desk, then we can help our businesses
sell more Made in America goods and services around the world, and we can
help more American workers compete and win," Obama said.
Sadly, just like with every other "free trade" agreement that the U.S. has
entered into since World War II, the exact opposite is what will actually happen.
Our trade deficit will get even larger, and we will see even more jobs and even
more businesses go overseas.
But the mainstream media will never tell you this. Instead, they are just
falling all over themselves as they heap praise on this new trade pact. Just
check out a couple of the headlines that we saw on Monday…
Overseas it is a different story. Many journalists over there fully recognize
that this treaty greatly benefits many of the big corporations that played a
key role in drafting it. For example, the following comes
from a newspaper in Thailand…
You will hear much about the importance of the TPP for "free trade".
The reality is that this is an agreement to manage its members' trade
and investment relations - and to do so on behalf of each country's most
powerful business lobbies.
Packaged as a gift to the American people that will renew industry and
make us more competitive, the Trans-Pacific Partnership is a Trojan horse.
It's a coup by multinational corporations who want global subservience to
their agenda. Buyer beware. Citizens beware.
The gigantic corporations that dominate our economy don't care about the
little guy. If they can save a few cents on the manufacturing of an item by
moving production to Timbuktu they will do it.
Over the past couple of decades, the United States has lost tens of thousands
of manufacturing facilities and millions of good paying jobs due to these "free
trade agreements". As we merge our economy with the economies of nations where
it is legal to pay slave labor wages, it is inevitable that corporations will
shift jobs to places where labor is much cheaper. Our economic infrastructure
is being absolutely eviscerated in the process, and very few of our politicians
seem to care.
Once upon a time, the city of Detroit was the greatest manufacturing city
on the planet and it had the highest per capita income in the entire nation.
But today it is a rotting, decaying hellhole that the rest of the world laughs
at. What has happened to the city of Detroit is happening to the entire nation
as a whole, but our politicians just keep pushing us even farther down the road
to oblivion.
Just consider what has happened since NAFTA was implemented. In the year
before NAFTA was approved, the United States actually had a trade surplus
with Mexico and our trade deficit with Canada was only 29.6 billion dollars.
But now things are very different. In one recent year, the U.S. had a combined
trade deficit with Mexico and Canada of
177 billion dollars.
And these trade deficits are not just numbers. They represent real jobs that
are being lost. It has been estimated that the U.S. economy loses
approximately 9,000 jobs for every 1 billion dollars of goods that are imported
from overseas, and one professor has estimated that cutting our trade deficit
in half would create
5 million more jobs in the United States.
Just yesterday, I wrote about how there are
102.6 million working age Americans that do not have a job right now. Once
upon a time, if you were honest, dependable and hard working it was easy to
get a good paying job in this country. But now things are completely different.
Why aren't more people alarmed by numbers like this?
And of course the Trans-Pacific Partnership is not just about "free trade".
In one of my
previous articles, I explained that Obama is using this as an opportunity
to permanently impose much of his agenda on a large portion of the globe…
It is basically a gigantic end run around Congress.
Thanks to leaks, we have learned that so many of the things that Obama has
deeply wanted for years are in this treaty. If adopted, this treaty
will fundamentally change our laws regarding Internet freedom, healthcare,
copyright and patent protection, food safety, environmental standards, civil
liberties and so much more. This treaty includes many of the rules
that alarmed Internet activists so much
when SOPA was being debated, it would essentially ban all "Buy American"
laws, it would give Wall Street banks much more freedom to trade risky
derivatives and it would force even more domestic manufacturing offshore.
The Republicans in Congress foolishly gave Obama
fast track negotiating authority, and so Congress will not be able to change
this treaty in any way. They will only have the opportunity for an up or down
vote.
I would love to see Congress reject this deal, but we all know that is extremely
unlikely to happen. When big votes like this come up, immense pressure is put
on key politicians. Yes, there are a few members of Congress that still have
backbones, but most of them are absolutely spineless. When push comes to shove,
the globalist agenda always seems to advance.
Meanwhile, the mainstream media will be telling the American people about
all of the wonderful things that this new treaty will do for them. You would
think that after how badly past "free trade" treaties have turned out that we
would learn something, but somehow that never seems to happen.
The agenda of the globalists is moving forward, and very few Americans seem
to care.
First of all, because NAFTA means jobs. American jobs, and good-paying
American jobs. If I didn't believe that, I wouldn't support this agreement.
Freddie
Many of those NeoCon Bibi lovers and Jonathan Pollard conservatives love
TPP and H1B Ted Cruz. Ted is also a Goldman Sachs boy.
Squids_In
That giant sucking sound just got gianter.
MrTouchdown
Probably, but here's a thought:
It might be a blowing sound of all things USA deflating down (in USD
terms) to what they are actually worth when compared to the rest of the
world. For example, a GM assembly line worker will make what an assembly
line worker in Vietnam makes.
This will, of course, panic Old Yellen, who will promptly fill her diaper
and begin subsidizing wages with Quantitative Pleasing (QP1).
Buckaroo Banzai
If this gets through congress, the Republican Party better not bother
asking for my vote ever again.
Chupacabra-322
Vote? You seem to think "voting" will actually influence actions / Globalists
plans which have been decades in the making amoungst thse Criminal Pure
Evil Lucerferian Psychopaths hell bent on Total Complete Full Spectrum World
Domination.
Yea, keep voting. I'll be out hunting down these Evil doers like the
dogs that they are.
Buckaroo Banzai
I have no illusions regarding the efficacy of voting. It is indeed a
waste of time.
What I said was, they better not dare even ASK for my vote.
Ignatius
Doesn't matter. Diebold is so good at counting that you don't even need
to show up at the polls anymore. It's like a miracle of modern technology.
Peter Pan
Did the article say 40%?
I imagine they meant 40% of whatever is left after we all go to hell
in a hand basket.
Great day for the multinationals and in particular the pharmaceutical
companies.
But those politicians lucky enough to win discover -- if they did not know already -- that their
capacity to affect even their own domestic environment is constrained by forces beyond their control.
Notable quotes:
"... But those politicians lucky enough to win discover -- if they did not know already -- that their capacity to affect even their own domestic environment is constrained by forces beyond their control. ..."
"... In the case of Britain, the once-powerful centralized governments of that country are now multiply constrained. As the power of Britain in international affairs has declined, so has the British government's power within its own domain. Membership of the European Union constrains British governments' ability to determine everything from the quantities of fish British fishermen can legally catch to the amount in fees that British universities can charge students from other EU countries. ..."
"... Not least, the EU's insistence on the free movement of labor caused the Conservative-dominated coalition that came to power in 2010 to renege on the Tories' spectacularly ill-judged pledge to reduce to "tens of thousands a year" the number of migrants coming to Britain. The number admitted in 2014 alone was nearer 300,000. ..."
"... On top of all that, British governments -- even more than those of some other predominantly capitalist economies -- are open to being buffeted by market forces, whose winds can acquire gale force. In a world of substantially free trade, imports and exports of goods and services are largely beyond any government's control, and the Bank of England's influence over the external value of sterling is negligible. During the present election campaign, HSBC, one of the world's largest banks, indicated that it was contemplating shifting its headquarters from the City of London to Hong Kong. For good or ill, Britain's government was, and is, effectively helpless to intervene. ..."
"... That's why we need a federal Europe. Local governments for local issues and elected by the local people and a European government for European issues elected by all Europeans. ..."
Once upon a time, national elections were -- or seemed to be -- overwhelmingly domestic affairs,
affecting only the peoples of the countries taking part in them. If that was ever true, it is so
no longer. Angela Merkel negotiates with Greece's government with Germany's voters looming in the
background. David Cameron currently fights an election campaign in the UK holding fast to the belief
that a false move on his part regarding Britain's relationship with the EU could cost his Conservative
Party seats, votes and possibly the entire election.
Britain provides a good illustration of a general proposition. It used to be claimed, plausibly,
that "all politics is local." In 2015, electoral politics may still be mostly local, but the post-electoral
business of government is anything but local. There is a misfit between the two. Voters are mainly
swayed by domestic issues. Vote-seeking politicians campaign accordingly. But those politicians
lucky enough to win discover -- if they did not know already -- that their capacity to affect even
their own domestic environment is constrained by forces beyond their control.
Anyone viewing the UK election campaign from afar could be forgiven for thinking that British
voters and politicians alike imagined they were living on some kind of self-sufficient sea-girt island.
The opinion polls indicate that a large majority of voters are preoccupied -- politically as well
as in other ways -- with their own financial situation, tax rates, welfare spending and the future
of the National Health Service. Immigration is an issue for many voters, but mostly in domestic terms
(and often as a surrogate for generalized discontent with Britain's political class). The fact that
migrants from Eastern Europe and elsewhere make a positive net contribution to both the UK's economy
and its social services scarcely features in the campaign.
... ... ...
After polling day, all that will change -- probably to millions of voters' dismay. One American
presidential candidate famously said that politicians campaign in poetry, but govern in prose. Politicians
in democracies, not just in Britain, campaign as though they can move mountains, then find that most
mountains are hard or impossible to move.
In the case of Britain, the once-powerful centralized governments of that country are now
multiply constrained. As the power of Britain in international affairs has declined, so has the British
government's power within its own domain. Membership of the European Union constrains British governments'
ability to determine everything from the quantities of fish British fishermen can legally catch to
the amount in fees that British universities can charge students from other EU countries.
Not least, the EU's insistence on the free movement of labor caused the Conservative-dominated
coalition that came to power in 2010 to renege on the Tories' spectacularly ill-judged pledge to
reduce to "tens of thousands a year" the number of migrants coming to Britain. The number admitted
in 2014 alone was nearer 300,000.
The UK's courts are also far more active than they were. The British parliament in 1998 incorporated
the European Convention on Human Rights into British domestic law, and British judges have determinedly
enforced those rights. During the 1970s, they had already been handed responsibility for enforcing
the full range of EU law within the UK.
Also, Britain's judges have, on their own initiative, exercised increasingly frequently their
long-standing power of "judicial review," invalidating ministerial decisions that violated due process
or seemed to them to be wholly unreasonable. Devolution of substantial powers to semi-independent
governments in Scotland, Wales and Northern Ireland has also meant that the jurisdiction of many
so-called UK government ministers is effectively confined to the purely English component part.
On top of all that, British governments -- even more than those of some other predominantly
capitalist economies -- are open to being buffeted by market forces, whose winds can acquire gale
force. In a world of substantially free trade, imports and exports of goods and services are largely
beyond any government's control, and the Bank of England's influence over the external value of sterling
is negligible. During the present election campaign, HSBC, one of the world's largest banks, indicated
that it was contemplating shifting its headquarters from the City of London to Hong Kong. For good
or ill, Britain's government was, and is, effectively helpless to intervene.
The heirs of Gladstone, Disraeli, Lloyd George and Winston Churchill, Britain's political leaders
are understandably still tempted to talk big. But their effective real-world influence is small.
No wonder a lot of voters in Britain feel they are being conned.
ItsJustTim
That's globalization. And it won't go away, even if you vote nationalist. The issues are increasingly
international, while the voters still have a mostly local perspective. That's why we need
a federal Europe. Local governments for local issues and elected by the local people and a European
government for European issues elected by all Europeans.
"... it seems fair to say: Globalism isn't quite the Wave of the Future that most observers thought it was, even just a year ago. And so before we attempt to divide the true intentions of Clinton and Trump, we might first step back and consider how we got to this point. ..."
"... An Inquiry into the Nature and Causes of the Wealth of Nations . ..."
"... Clinton will say anything then she'll sell you out. I hope we never get a chance to see how she will sell us out on TPP ..."
"... What we would be headed for under Hillary Clinton is fascism--Mussolini's shorthand definition of fascism was the marriage of industry and commerce with the power of the State. That is what the plutocrats who run the big banks (to whom she owes her soul) aim to do. President, Thomas Jefferson knew the dangers of large European-style central banks. ..."
On the surface, it appears that Hillary Clinton and Donald Trump, for all their mutual antipathy,
are united on one big issue: opposition to new trade deals. Here's a recent headline in
The Guardian: "Trump and Clinton's free trade retreat: a pivotal moment for the world's
economic future."
And the subhead continues in that vein:
Never before have both main presidential candidates broken so completely with Washington orthodoxy
on globalization, even as the White House refuses to give up. The problem, however, goes much
deeper than trade deals.
In the above quote, we can note the deliberate use of the loaded word, "problem." As in, it's
a problem that free trade is unpopular-a problem, perhaps, that the MSM can fix. Yet in the
meantime, the newspaper sighed, the two biggest trade deals on the horizon, the well-known
Trans Pacific Partnership (TPP), and the lesser-known
Trans Atlantic Trade Investment
Partnership (TTIP), aimed at further linking the U.S. and European Union (EU), are both in jeopardy.
So now we must ask broader questions: What does this mean for trade treaties overall? And what
are the implications for globalism?
More specifically, we can ask: Are we sure that the two main White House hopefuls, Clinton and
Trump, are truly sincere in their opposition to those deals? After all, as has been
widely reported, President Obama still has plans to push TPP through to enactment in the "lame
duck" session of Congress after the November elections. Of course, Obama wouldn't seek to do that
if the president-elect opposed it-or would he?
Yet on August 30, Politico reminded its Beltway readership, "How
Trump or Clinton could kill Pacific trade deal." In other words, even if Obama were to move TPP
forward in his last two months in office, the 45th president could still block its implementation
in 2017 and beyond. If, that is, she or he really wanted to.
Indeed, as we think about Clinton and Trump, we realize that there's "opposition" that's for show
and there's opposition that's for real.
Still, given what's been said on the presidential campaign trail this year, it seems fair
to say: Globalism isn't quite the Wave of the Future that most observers thought it was, even just
a year ago. And so before we attempt to divide the true intentions of Clinton and Trump, we might
first step back and consider how we got to this point.
2. The Free Trade Orthodoxy
It's poignant that the headline, "Trump and Clinton's free trade retreat", lamenting the decay
of free trade, appeared in The Guardian. Until recently, the newspaper was known as The
Manchester Guardian, as in Manchester, England. And Manchester is not only a big city, population
2.5 million, it is also a city with a fabled past: You see, Manchester was the cradle of the Industrial
Revolution, which transformed England and the world. It was that city that helped create the free
trade orthodoxy that is now crumbling.
Yes, in the 18th and 19th centuries, Manchester was the leading manufacturing city in the world,
especially for textiles. It was known as "Cottonopolis."
Indeed, back then, Manchester was so much more efficient and effective at mass production that
it led the world in exports. That is, it could produce its goods at such low cost that it could send
them across vast oceans and still undercut local producers on price and quality.
Over time, this economic reality congealed into a school of thought: As Manchester grew rich from
exports, its business leaders easily found economists, journalists, and propagandists who would help
advance their cause in the press and among the intelligentsia.
The resulting school of thought became known, in the 19th century, as "Manchester
Liberalism." And so, to this day, long after Manchester has lost its economic preeminence to
rivals elsewhere in the world, the phrase "Manchester Liberalism" is a well-known in the history
of economics, bespeaking ardent support for free markets and free trade.
More recently, the hub for free-trade enthusiasm has been the United States. In particular, the
University of Chicago, home to the Nobel Prize-winning economist Milton Friedman, became free trade's
academic citadel; hence the "Chicago
School" has displaced Manchesterism.
And just as it made sense for Manchester Liberalism to exalt free trade and exports when Manchester
and England were on top, so, too, did the Chicago School exalt free trade when the U.S. was unquestionably
the top dog.
So back in the 40s and 50s, when the rest of the world was either bombed flat or still under the
yoke of colonialism, it made perfect sense that the U.S., as the only intact industrial power, would
celebrate industrial exports: We were Number One, and it was perfectly rational to make the most
of that first-place status. And if scribblers and scholars could help make the case for this new
status quo, well, bring 'em aboard. Thus the Chicago School gained ascendancy in the late 20th century.
And of course, the Chicagoans drew inspiration from a period even earlier than Manchesterism,
3. On the Origins of the Orthodoxy: Adam Smith and David Ricardo
One passage in that volume considers how individuals might optimize their own production and consumption:
It is the maxim of every prudent master of a family never to attempt to make at home what it
will cost him more to make than to buy.
Smith is right, of course; everyone should always be calculating, however informally, whether
or not it's cheaper to make it at home or buy it from someone else.
We can quickly see: If each family must make its own clothes and grow its own food, it's likely
to be worse off than if it can buy its necessities from a large-scale producer. Why? Because, to
be blunt about it, most of us don't really know how to make clothes and grow food, and it's expensive
and difficult-if not downright impossible-to learn how. So we can conclude that self-sufficiency,
however rustic and charming, is almost always a recipe for poverty.
Smith had a better idea: specialization. That is, people would specialize in one line of
work, gain skills, earn more money, and then use that money in the marketplace, buying what they
needed from other kinds of specialists.
Moreover, the even better news, in Smith's mind, was that this kind of specialization came naturally
to people-that is, if they were free to scheme out their own advancement. As Smith argued, the ideal
system would allow "every man to pursue his own interest his own way, upon the liberal plan of equality,
liberty and justice."
That is, men (and women) would do that which they did best, and then they would all come together
in the free marketplace-each person being inspired to do better, thanks to, as Smith so memorably
put it, the "invisible hand." Thus Smith articulated a key insight that undergirds the whole of modern
economics-and, of course, modern-day prosperity.
A few decades later, in the early 19th century, Smith's pioneering work was expanded upon by another
remarkable British economist, David Ricardo.
Ricardo's big idea built on Smithian specialization; Ricardo called it "comparative advantage."
That is, just as each individual should do what he or she does best, so should each country.
In Ricardo's well-known illustration, he explained that the warm and sunny climate of Portugal
made that country ideal for growing the grapes needed for wine, while the factories of England made
that country ideal for spinning the fibers needed for apparel and other finished fabrics.
Thus, in Ricardo's view, we could see the makings of a beautiful economic friendship: The Portuguese
would utilize their comparative advantage (climate) and export their surplus wine to England, while
the English would utilize their comparative advantage (manufacturing) and export apparel to Portugal.
Thus each would benefit from the exchange of efficiently-produced products, as each export paid for
the other.
Furthermore, in Ricardo's telling, if tariffs and other barriers were eliminated, then both countries,
Portugal and England, would enjoy the maximum free-trading win-win.
Actually, in point of fact-and Ricardo knew this-the relationship was much more of a win for England,
because manufacture is more lucrative than agriculture. That is, a factory in Manchester could crank
out garments a lot faster than a vineyard in Portugal could ferment wine.
And as we all know, the richer, stronger countries are industrial, not agricultural. Food is essential-and
alcohol is pleasurable-but the real money is made in making things. After all, crops can be grown
easily enough in many places, and so prices stay low. By contrast, manufacturing requires a lot of
know-how and a huge upfront investment. Yet with enough powerful manufacturing, a nation is always
guaranteed to be able to afford to import food. And also, it can make military weapons, and so, if
necessary, take foreign food and croplands by force.
We can also observe that Ricardo, smart fellow that he was, nevertheless was describing the economy
at a certain point in time-the era of horse-drawn carriages and sailing ships. Ricardo realized that
transportation was, in fact, a key business variable. He wrote that it was possible for a company
to seek economic advantage by moving a factory from one part of England to another. And yet in his
view, writing from the perspective of the year 1817, it was impossible to imagine
moving a factory from England to another country:
It would not follow that capital and population would necessarily move from England to Holland,
or Spain, or Russia.
Why this presumed immobility of capital and people? Because, from Ricardo's early 19th-century
perspective, transportation was inevitably slow and creaky; he didn't foresee steamships and airplanes.
In his day, relying on the technology of the time, it wasn't realistic to think that factories, and
their workers, could relocate from one country to another.
Moreover, in Ricardo's era, many countries were actively hostile to industrialization, because
change would upset the aristocratic rhythms of the old order. That is, industrialization could turn
docile or fatalistic peasants, spread out thinly across the countryside, into angry and self-aware
proletarians, concentrated in the big cities-and that was a formula for unrest, even revolution.
Indeed, it was not until the 20th century that every country-including China, a great civilization,
long asleep under decadent imperial misrule-figured out that it had no choice other than to industrialize.
So we can see that the ideas of Smith and Ricardo, enduringly powerful as they have been, were
nonetheless products of their time-that is, a time when England mostly had the advantages of industrialism
to itself. In particular, Ricardo's celebration of comparative advantage can be seen as an artifact
of his own era, when England enjoyed a massive first-mover advantage in the industrial-export game.
Smith died in 1790, and Ricardo died in 1823; a lot has changed since then. And yet the two economists
were so lucid in their writings that their work is studied and admired to this day.
Unfortunately, we can also observe that their ideas have been frozen in a kind of intellectual
amber; even in the 21st century, free trade and old-fashioned comparative advantage are unquestioningly
regarded as the keys to the wealth of nations-at least in the U.S.-even if they are so no longer.
4. Nationalist Alternatives to Free Trade Orthodoxy
As we have seen, Smith and Ricardo were pushing an idea, free trade, that was advantageous to
Britain.
So perhaps not surprisingly, rival countries-notably the United States and Germany-soon developed
different ideas. Leaders in Washington, D.C., and Berlin didn't want their respective nations to
be mere dependent receptacles for English goods; they wanted real independence. And so they wanted
factories of their own.
In the late 18th century, Alexander Hamilton, the visionary American patriot, could see that both
economic wealth and military power flowed from domestic industry. As the nation's first Treasury
Secretary, he persuaded President George Washington and the Congress to support a system of protective
tariffs and "internal improvements" (what today we would call infrastructure) to foster US manufacturing
and exporting.
And in the 19th century, Germany, under the much heavier-handed leadership of Otto von Bismarck,
had the same idea: Make a concerted effort to make the nation stronger.
In both countries, this industrial policymaking succeeded. So whereas at the beginning of the
19th century, England had led the world in steel production, by the beginning of the 20th century
century, the U.S. and Germany had moved well ahead. Yes, the "invisible hand" of individual self-interest
is always a powerful economic force, but sometimes, the "visible hand" of national purpose, animated
by patriotism, is even more powerful.
Thus by 1914, at the onset of World War One, we could see the results of the Smith/Ricardo model,
on the one hand, and the Hamilton/Bismarck model, on the other. All three countries-Britain, the
US, and Germany, were rich-but only the latter two had genuine industrial mojo. Indeed, during World
War One, English weakness became glaringly apparent in the 1915
shell crisis-as
in, artillery shells. It was only the massive importing of made-in-USA ammunition that saved Britain
from looming defeat.
Yet as always, times change, as do economic circumstances, as do prevailing ideas.
As we have seen, at the end of World War II, the U.S. was the only industrial power left standing.
And so it made sense for America to shift from a policy of Hamiltonian protection to a policy of
Smith-Ricardian export-minded free trade. Indeed, beginning in around 1945, both major political
parties, Democrats and Republicans, solidly embraced the new line: The U.S. would be the factory
for the world.
Yet if times, circumstances, and ideas change, they can always change again.
5. The Contemporary Crack-Up
As we have seen, in the 19th century, not every country wanted to be on the passive receiving
end of England's exports. And this was true, too, in the 20th century; Japan, notably, had its own
ideas.
If Japan had followed the Ricardian doctrine of comparative advantage, it would have focused on
exporting rice and tuna. Instead, by dint of hard work, ingenuity, and more than a little national
strategizing, Japan grew itself into a great and prosperous industrial power. Its exports, we might
note, were such high-value-adds as automobiles and electronics, not mere crops and fish.
Moreover, according to the same theory of comparative advantage, South Korea should have been
exporting parasols and kimchi, and China should have settled for exporting fortune cookies and pandas.
Yet as the South Korean economist
Ha-Joon Chang has chronicled,
these Asian nations resolved, in their no-nonsense neo-Confucian way, to launch state-guided private
industries-and the theory of comparative advantage be damned.
Yes, their efforts violated Western economic orthodoxy, but as the philosopher Kant once observed,
the actual proves the possible. Indeed, today, as we all know, the Asian tigers are among the richest
and fastest-growing economies in the world.
China is not only the world's largest economy in terms of purchasing power parity (PPP), but
also the world's largest manufacturing nation-producing 52 percent of color televisions, 75 percent
of mobile phones and 87 percent of the world's personal computers. The Chinese automobile industry
is the world's largest, twice the size of America's. China leads the world in foreign exchange
reserves. The United States is the main trading partner for seventy-six countries. China is the
main trading partner for 124.
In particular, we might pause over one item in that impressive litany: China makes 87 percent
of the world's personal computers.
Indeed, if it's true, as ZDNet reports, that
the Chinese have built "backdoors" into almost all the electronic equipment that they sell-that
is to say, the equipment that we buy-then we can assume that we face a serious military challenge,
as well as a serious economic challenge.
Yes, it's a safe bet that the People's Liberation Army has a good handle on our defense establishment,
especially now that the Pentagon has fully equipped itself with
Chinese-made iPhones and iPads.
Of course, we can safely predict that Defense Department bureaucrats will always say that there's
nothing to worry about, that they have the potential hacking/sabotage matter under control (although
just to be sure, the Pentagon might say, give us more money).
Yet we might note that this is the same defense establishment that couldn't keep track of lone
internal rogues such as Bradley Manning and Edward Snowden. Therefore, should we really believe that
this same DOD knows how to stop the determined efforts of a nation of 1.3 billion people, seeking
to hack machines-machines that they made in the first place?
Yes, the single strongest argument against the blind application of free- trade dogma is the doctrine
of self defense. That is, all the wealth in the world doesn't matter if you're conquered. Even Adam
Smith understood that; as he wrote, "Defense
. . . is of much more importance than opulence."
Yet today we can readily see: If we are grossly dependent on China for vital wares, then we can't
be truly independent of China. In fact, we should be downright fearful.
Still, despite these deep strategic threats, directly the result of careless importing, the Smith-Ricardo
orthodoxy remains powerful, even hegemonistic-at least in the English-speaking world.
Why is this so? Yes, economists are typically seen as cold and nerdy, even bloodless, and yet,
in fact, they are actual human beings. And as such, they are susceptible to the giddy-happy feeling
that comes from the hope of building a new utopia, the dream of ushering in an era of world harmony,
based on untrammeled international trade. Indeed, this woozy idealism among economists goes way back;
it was the British free trader Richard Cobden who declared in 1857,
Free trade is God's diplomacy. There is no other certain way of uniting people in the bonds
of peace.
And lo, so many wars later, many economists still believe that.
Indeed, economists today are still monolithically pro-fee trade; a
recent survey of economists found that 83 percent supported eliminating all tariffs and other
barriers; just 10 percent disagreed.
We might further note that others, too, in the financial and intellectual elite are fully on board
the free-trade train, including most corporate officers and their lobbyists, journalists, academics,
and, of course, the mostly for-hire think-tankers.
To be sure, there are always exceptions: As that Guardian article, the one lamenting the
sharp decrease in support for free trade as a "problem," noted, not all of corporate America is on
board, particularly those companies in the manufacturing sector:
Ford openly opposes TPP because it fears the deal does nothing to stop Japan manipulating its
currency at the expense of US rivals.
Indeed, we might note that the same Guardian story included an even more cautionary note,
asserting that support for free trade, overall, is remarkably rickety:
Some suggest a "bicycle theory" of trade deals: that the international bandwagon has to keep
rolling forward or else it all wobbles and falls down.
So what has happened? How could virtually the entire elite be united in enthusiasm for free trade,
and yet, even so, the free trade juggernaut is no steadier than a mere two-wheeled bike? Moreover,
free traders will ask: Why aren't the leaders leading? More to the point, why aren't the followers
following?
To answer those questions, we might start by noting the four-decade phenomenon of
wage stagnation-that's
taken a toll on support for free trade. But of course, it's in the heartland that wages have been
stagnating; by contrast,
incomes for
the bicoastal elites have been soaring.
We might also note that some expert predictions have been way off, thus undermining confidence
in their expertise. Remember, this spring, when all the experts were saying that the United Kingdom
would fall into recession, or worse, if it voted to leave the EU? Well, just the other day came this
New York Post headline: "Brexit
actually boosting the UK economy."
Thus from the Wall Street-ish perspective of the urban chattering classes, things are going well-so
what's the problem?
Yet the folks on Main Street have known a different story. They have seen, with their own eyes,
what has happened to them, and no fusillade of op-eds or think-tank monographs will persuade them
to change their mind.
However, because the two parties have been so united on the issues of trade and globalization-the
"Uniparty," it's sometimes called-the folks in the boonies have had no political alternative. And
as they say, the only power you have in this world is the power of an alternative. And so, lacking
an alternative, the working/middle class has just had to accept its fate.
Indeed, it has been a bitter fate, particularly bitter in the former industrial heartland. In
a 2013 paper, the
Economic Policy Institute (EPI) came to some startling conclusions:
Growing trade with less-developed countries lowered wages in 2011 by 5.5 percent-or by roughly
$1,800-for a full-time, full-year worker earning the average wage for workers without a four-year
college degree.
The paper added, "One-third of this total effect is due to growing trade with just China."
Continuing, EPI found that even as trade with low-wage countries caused a decrease in the incomes
for lower-end workers, it had caused an increase in the incomes of high-end workers-so no
wonder the high-end thinks globalism in great.
To be sure, some in the elite are bothered by what's been happening.
Peggy Noonan, writing earlier this year in The Wall Street Journal-a piece that must have
raised the hackles of her doctrinaire colleagues-put the matter succinctly: There's a wide, and widening,
gap between the "protected" and the "unprotected":
The protected make public policy. The unprotected live in it. The unprotected are starting
to push back, powerfully.
Of course, Noonan was alluding to the Trump candidacy-and also to the candidacy of Sen. Bernie
Sanders. Those two insurgents, in different parties, have been propelled by the pushing from all
the unprotected folks across America.
We might pause to note that free traders have arguments which undoubtedly deserve a fuller airing.
Okay. However, we can still see the limits. For example, the familiar gambit of outsourcing jobs
to China, or Mexico-or 50 other countries-and calling that "free trade" is now socially unacceptable,
and politically unsustainable.
Still, the broader vision of planetary freedom, including the free flow of peoples and their ideas,
is always enormously appealing. The United States, as well as the world, undoubtedly benefits from
competition, from social and economic mobility-and yes, from new blood.
As
Stuart Anderson, executive director of the National Foundation for American Policy, notes, "77
percent of the full-time graduate students in electrical engineering and 71 percent in computer science
at U.S. universities are international students." That's a statistic that should give every American
pause to ask: Why aren't we producing more engineers here at home?
We can say, with admiration, that Silicon Valley is the latest Manchester; as such, it's a powerful
magnet for the best and the brightest from overseas, and from a purely dollars-and-cents point of
view, there's a lot to be said for welcoming them.
So yes, it would be nice if we could retain this international mobility that benefits the U.S.-but
only if the economic benefits can be broadly shared, and patriotic assimilation of immigrants can
be truly achieved, such that all Americans can feel good about welcoming newcomers.
The further enrichment of Silicon Valley won't do much good for the country unless those riches
are somehow widely shared. In fact, amidst the ongoing outsourcing of mass-production jobs,
total employment in such boomtowns as San Francisco and San Jose has barely budged. That is,
new software billionaires are being minted every day, but their workforces tend to be tiny-or located
overseas. If that past pattern is the future pattern, well, something will have to give.
We can say: If America is to be
one nation-something Mitt "47 percent" Romney never worried about, although it cost him in the
end-then we will have to figure out a way to turn the genius of the few into good jobs for the many.
The goal isn't socialism, or anything like that; instead, the goal is the widespread distribution
of private property, facilitated, by conscious national economic development, as
I argued at the tail end of this piece.
If we can't, or won't, find a way to expand private ownership nationwide, then the populist upsurges
of the Trump and Sanders campaigns will be remembered as mere overtures to a starkly divergent future.
6. Clinton and Trump Say They Are Trade Hawks: But Are They Sincere?
So now we come to a mega-question for 2016: How should we judge the sincerity of the two major-party
candidates, Clinton or Trump, when they affirm their opposition to TPP? And how do we assess their
attitude toward globalization, including immigration, overall?
The future is, of course, unknown, but we can make a couple of points.
First, it is true that
many have questioned the sincerity of Hillary's new anti-TPP stance, especially given the presence
of such prominent free-traders as vice presidential nominee Tim Kaine and presidential transition-planning
chief Ken Salazar. Moreover, there's also Hillary's own decades-long association with open-borders
immigration policies, as well as past support for such trade bills as NAFTA, PNTR, and, of course,
TPP. And oh yes, there's the Clinton Foundation, that global laundromat for every overseas fortune;
most of those billionaires are globalists par excellence-would a President Hillary really
cross them?
Second, since there's still no way to see inside another person's mind, the best we can
do is look for external clues-by which we mean, external pressures. And so we might ask a basic question:
Would the 45th president, whoever she or he is, feel compelled by those external pressures to keep
their stated commitment to the voters? Or would they feel that they owe more to their elite friends,
allies, and benefactors?
As we have seen, Clinton has long chosen to surround herself with free traders and globalists.
Moreover, she has raised money from virtually every bicoastal billionaire in America.
So we must wonder: Will a new President Clinton really betray her own class-all those
Davos Men and Davos Women-for the sake of middle-class folks she has never met, except maybe
on a rope line? Would Clinton 45, who has spent her life courting the powerful, really stick her
neck out for unnamed strangers-who never gave a dime to the Clinton Foundation?
Okay, so what to make of Trump? He, too, is a fat-cat-even more of fat-cat, in fact, than Clinton.
And yet for more than a year now, he has based his campaign on opposition to globalism in all its
forms; it's been the basis of his campaign-indeed, the basis of his base. And his campaign policy
advisers are emphatic. According to Politico, as recently as August 30, Trump trade adviser
Peter Navarro reiterated Trump's opposition to TPP, declaring,
Any deal must increase the GDP growth rate, reduce the trade deficit, and strengthen the manufacturing
base.
So, were Trump to win the White House, he would come in with a much more solid anti-globalist
mandate.
Thus we can ask: Would a President Trump really cross his own populist-nationalist base by going
over to the other side-to the globalists who voted, and donated, against him? If he did-if he repudiated
his central platform plank-he would implode his presidency, the way that Bush 41 imploded his presidency
in 1990 when he went back on his "read my lips, no new taxes" pledge.
Surely Trump remembers that moment of political calamity well, and so surely, whatever mistakes
he might make, he won't make that one.
To be sure, the future is unknowable. However, as we have seen, the past, both recent and historical,
is rich with valuable clues.
Clinton will say anything then she'll sell you out. I hope we never get a chance to see
how she will sell us out on TPP
Ellen Bell -> HoosierMilitia
You really do not understand the primitive form of capitalism that the moneyed elites are trying
to impose on us. That system is mercantilism and two of its major tenets are to only give the
workers subsistence level wages (what they are doing to poor people abroad and attempting to do
here) and monopolistic control of everything that is possible to monopolize. The large multi-nationals
have already done that. What we would be headed for under Hillary Clinton is fascism--Mussolini's
shorthand definition of fascism was the marriage of industry and commerce with the power of the
State. That is what the plutocrats who run the big banks (to whom she owes her soul) aim to do.
President, Thomas Jefferson knew the dangers of large European-style central banks. He said:
"...The central bank is an institution of the most deadly hostility existing against the
Principles and form of our Constitution. I am an Enemy to all banks discounting bills or notes
for anything but Coin. If the American People allow private banks to control the issuance of
their currency, first by inflation and then by deflation, the banks and corporations that will
grow up around them will deprive the People of all their Property until their Children will
wake up homeless on the continent their Fathers conquered..."
The power to create money was given to the private banking system of the Federal Reserve in
1913. Nearly every bit of our enormous debt has been incurred since then. The American people
have become debt-slaves. In the Constitution, only Congress has the right to issue currency. That's
why the plutocrats want to do away with it--among other reasons.
"... Donald Trump is challenging the very fabric of the institutional elites in this country on both sides that have, quite frankly, just straight up screwed this country up and made the world a mess. ..."
Tom Coyne, a lifelong Democrat and the mayor of Brook Park, Ohio, spoke
about his endorsement of Republican presidential nominee Donald Trump with Breitbart
News Daily SiriusXM host Matt Boyle.
Coyne said:
The parties are blurred. What's the difference? They say the same things
in different tones. At the end of the day, they accomplish nothing.
Donald Trump is challenging the very fabric of the institutional elites
in this country on both sides that have, quite frankly, just straight up
screwed this country up and made the world a mess.
Regarding the GOP establishment's so-called Never Trumpers, Coyne stated,
"If it's their expertise that people are relying upon as to advice to vote,
people should go the opposite."
In an interview last week, Coyne said that Democrats and Republicans
have failed the city through inaction and bad trade policies, key themes
Trump often trumpets.
"He understands us," Coyne said of Trump. "He is saying what we feel,
and therefore, let him shake the bedevils out of everyone in the canyons
of Washington D.C. The American people are responding to him."
Breitbart News Daily airs on SiriusXM Patriot 125 weekdays from 6:00
a.m. to 9:00 a.m. Eastern.
"... Donald Trump isn't a politician -- he's a one-man wrecking ball against our dysfunctional and corrupt establishment. We're about to see the deluxe version of the left's favorite theme: Vote for us or we'll call you stupid. It's the working class against the smirking class. ..."
"... He understands that if we're ever going to get our economy back on its feet the wage-earning middle class will have to prosper along with investors ..."
"... Trump that really "gets" the idea that the economy is suffering because the middle class can't find employment at livable wages ..."
"... Ms. Coulter says it more eloquently: "The Republican establishment has no idea how much ordinary voters hate both parties." Like me, she's especially annoyed with Republicans, because we think of the Republican Party as being our political "family" that has turned against us: ..."
"... The RNC has been forcing Republican candidates to take suicidal positions forever They were happy to get 100 percent of the Business Roundtable vote and 20 percent of the regular vote. ..."
"... American companies used free trade with low-wage countries as an opportunity to close their American factories and relocate the jobs to lower-paying foreign workers. Instead of creating product and exporting it to other countries, our American companies EXPORTED American JOBS to other countries and IMPORTED foreign-made PRODUCTS into America! Our exports have actually DECLINED during the last five years with most of the 20 countries we signed free trade with. Even our exports to Canada, our oldest free trade partner, are less than what they were five years ago. ..."
"... Trade with Japan, China, and South Korea is even more imbalanced, because those countries actively restrict imports of American-made products. We run a 4x trade imbalance with China, which cost us $367 billion last year. We lost $69 billion to Japan and $28 billion to South Korea. Our exports to these countries are actually DECLINING, even while our imports soar! ..."
"... Why do Establishment Republicans join with Democrats in wanting to diminish the future with the WRONG kind of "free trade" that removes jobs and wealth from the USA? As Ms. Coulter reminds us, it is because Republican Establishment, like the Democrat establishment, is PAID by the money and jobs they receive from big corporations to believe it. ..."
"... The donor class doesn't care. The rich are like locusts: once they've picked America dry, they'll move on to the next country. A hedge fund executive quoted in The Atlantic a few years ago said, "If the transformation of the world economy lifts four people in China and India out of poverty and into the middle class, and meanwhile [that] means one American drops out of the middle class, that's not such a bad trade." ..."
"... The corporate 1% who believe that the global labor market should be tapped in order to beat American workers out of their jobs; and that corporations and the 1% who own them should be come tax-exempt organizations that profit by using cheap overseas labor to product product that is sold in the USA, and without paying taxes on the profit. Ms. Coulter calls this group of Republican Estblishmentarians "locusts: once they've picked America dry, they'll move on to the next country." ..."
"... Pretending to care about the interests of minorities. Of course, the Republican Establishment has even less appeal to minorities than to the White Middle Class (WMC) they abandoned. Minorities are no more interested in losing their jobs to foreigners or to suffer economic stagnation while the rich have their increasing wealth (most of which is earned at the expense of the middle class) tax-sheltered, than do the WMC. ..."
"... Trump has given Republicans a new lease on life. The Establishment doesn't like having to take a back seat to him, but perhaps they should understand that having a back seat in a popular production is so much better than standing outside alone in the cold. ..."
Donald Trump isn't a politician -- he's a one-man wrecking ball against our dysfunctional
and corrupt establishment. We're about to see the deluxe version of the left's favorite theme: Vote
for us or we'll call you stupid. It's the working class against the smirking class.
No pandering! The essence of Trump in personality and issues , August 23, 2016
Ms. Coulter explains the journey of myself and so many other voters into Trump's camp. It captures
the essence of Trump as a personality and Trump on the issues. If I had to sum Ms. Coulter's view
of the reason for Trump's success in two words, I'd say "No Pandering!" I've heard many people,
including a Liberal tell me, "Trump says what needs to be said."
I've voted Republican in every election going back to Reagan in 1980, except for 2012 when
I supported President Obama's re-election. I've either voted for, or financially supported many
"Establishment Republicans" like Mitt Romney and John McCain in 2008. I've also supported some
Conservative ones like Newt Gingrich and Rudy Giuliani. In this election I'd been planning to
vote for Jeb Bush, a superb governor when I lived in Florida.
Then Trump announced his candidacy. I had seen hints of that happening as far back as 2012.
In my Amazon reviews in 2012 I said that many voters weren't pleased with Obama or the Republican
Establishment. So the question became: "Who do you vote for if you don't favor the agendas of
either party's legacy candidates?" In November 2013 I commented on the book DOUBLE DOWN: GAME
CHANGE 2012 by Mark Halperin and John Heileman:
=====
Mr. Trump occupies an important place in the political spectrum --- that of being a Republican
Populist.
He understands that if we're ever going to get our economy back on its feet the wage-earning
middle class will have to prosper along with investors, who are recovering our fortunes in
the stock market.
IMO whichever party nominates a candidate like Trump that really "gets" the idea that the
economy is suffering because the middle class can't find employment at livable wages, will
be the party that rises to dominance.
Mr. Trump, despite his flakiness, at least understood that essential fact of American economic
life.
November 7, 2013
=====
Ms. Coulter says it more eloquently: "The Republican establishment has no idea how much
ordinary voters hate both parties." Like me, she's especially annoyed with Republicans, because
we think of the Republican Party as being our political "family" that has turned against us:
===== The RNC has been forcing Republican candidates to take suicidal positions forever They were
happy to get 100 percent of the Business Roundtable vote and 20 percent of the regular vote.
when the GOP wins an election, there is no corresponding "win" for the unemployed blue-collar
voter in North Carolina. He still loses his job to a foreign worker or a closed manufacturing
plant, his kids are still boxed out of college by affirmative action for immigrants, his community
is still plagued with high taxes and high crime brought in with all that cheap foreign labor.
There's no question but that the country is heading toward being Brazil. One doesn't have to
agree with the reason to see that the very rich have gotten much richer, placing them well beyond
the concerns of ordinary people, and the middle class is disappearing. America doesn't make anything
anymore, except Hollywood movies and Facebook. At the same time, we're importing a huge peasant
class, which is impoverishing what remains of the middle class, whose taxes support cheap labor
for the rich.
With Trump, Americans finally have the opportunity to vote for something that's popular.
=====
That explains how Trump won my vote --- and held on to it through a myriad of early blunders
and controversies that almost made me switch my support to other candidates.
I'm no "xenophobe isolationist" stereotype. My first employer was an immigrant from Eastern
Europe. What I learned working for him launched me on my successful career. I've developed and
sold computer systems to subsidiaries of American companies in Europe and Asia. My business partners
have been English and Canadian immigrants. My family are all foreign-born Hispanics. Three of
my college roommates were from Ecuador, Germany, and Syria.
BECAUSE of this international experience I agree with the issues of trade and immigration that
Ms. Coulter talks about that have prompted Trump's rising popularity.
First, there is the false promise that free trade with low-wage countries would "create millions
of high-paying jobs for American workers, who will be busy making high-value products for export."
NAFTA was signed in 1994. GATT with China was signed in 2001. Since then we've signed free trade
with 20 countries. It was said that besides creating jobs for Americans, that free trade would
prosper the global economy. In truth the opposite happened:
American companies used free trade with low-wage countries as an opportunity to close their
American factories and relocate the jobs to lower-paying foreign workers. Instead of creating
product and exporting it to other countries, our American companies EXPORTED American JOBS to
other countries and IMPORTED foreign-made PRODUCTS into America! Our exports have actually DECLINED
during the last five years with most of the 20 countries we signed free trade with. Even our exports
to Canada, our oldest free trade partner, are less than what they were five years ago.
We ran trade SURPLUSES with Mexico until 1994, when NAFTA was signed. The very next year the
surplus turned to deficit, now $60 billion a year. Given that each American worker produces an
average of $64,000 in value per year, that is a loss of 937,000 American jobs to Mexico alone.
The problem is A) that Mexicans are not wealthy enough to be able to afford much in the way of
American-made product and B) there isn't much in the way of American-made product left to buy,
since so much of former American-made product is now made in Mexico or China.
Trade with Japan, China, and South Korea is even more imbalanced, because those countries
actively restrict imports of American-made products. We run a 4x trade imbalance with China, which
cost us $367 billion last year. We lost $69 billion to Japan and $28 billion to South Korea. Our
exports to these countries are actually DECLINING, even while our imports soar!
Thus, free trade, except with a few fair-trading countries like Canada, Australia, and possibly
Britain, has been a losing proposition. Is it coincidence that our economy has weakened with each
trade deal we have signed? Our peak year of labor force participation was 1999. Then we had the
Y2K collapse and the Great Recession, followed by the weakest "recovery" since WWII? As Trump
would say, free trade has been a "disaster."
Why do Establishment Republicans join with Democrats in wanting to diminish the future
with the WRONG kind of "free trade" that removes jobs and wealth from the USA? As Ms. Coulter
reminds us, it is because Republican Establishment, like the Democrat establishment, is PAID by
the money and jobs they receive from big corporations to believe it. Ms. Coulter says:
===== The donor class doesn't care. The rich are like locusts: once they've picked America dry,
they'll move on to the next country. A hedge fund executive quoted in The Atlantic a few years
ago said, "If the transformation of the world economy lifts four people in China and India
out of poverty and into the middle class, and meanwhile [that] means one American drops out
of the middle class, that's not such a bad trade."
=====
Then there is immigration. My wife, son, and extended family legally immigrated to the USA
from Latin America. The first family members were recruited by our government during the labor
shortage of the Korean War. Some fought for the United States in Korea. Some of their children
fought for us in Vietnam, and some grandchildren are fighting in the Middle East. Most have
become successful professionals and business owners. They came here LEGALLY, some waiting in
queue for up to 12 years. They were supported by the family already in America until they were
on their feet.
Illegal immigration has been less happy. Illegals are here because the Democrats want new voters
and the Republicans want cheap labor. Contrary to business propaganda, illegals cost Americans
their jobs. A colleague just old me, "My son returned home from California after five years, because
he couldn't get construction work any longer. All those jobs are now done off the books by illegals."
It's the same in technology. Even while our high-tech companies are laying off 260,000 American
employees in 2016 alone, they are banging the drums to expand the importation of FOREIGN tech
workers from 85,000 to 195,000 to replace the Americans they let go. Although the H1-B program
is billed as bringing in only the most exceptional, high-value foreign engineers, in truth most
visas are issued to replace American workers with young foreigners of mediocre ability who'll
work for much less money than the American family bread-winners they replaced.
Both parties express their "reverse racism" against the White Middle Class. Democrats don't
like them because they tend to vote Republican. The Republican Establishment doesn't like them
because they cost more to employ than overseas workers and illegal aliens. According to them the
WMC is too technologically out of date and overpaid to allow our benighted business leaders to
"compete internationally."
Ms. Coulter says "Americans are homesick" for our country that is being lost to illegal immigration
and the removal of our livelihoods overseas. We are sick of Republican and Democrat Party hidden
agendas, reverse-racism, and economic genocide against the American people. That's why the Establishment
candidates who started out so theoretically strong, like Jeb Bush, collapsed like waterlogged
houses of cards when they met Donald Trump. As Ms. Coulter explains, Trump knows their hidden
agendas, and knows they are working against the best interests of the American Middle Class.
Coulter keeps coming back to Mr. Trump's "Alpha Male" personality that speaks to Americans
as nation without pandering to specific voter identity groups. She contrasts his style to the
self-serving "Republican (Establishment) Brain Trust that is mostly composed of comfortable, well-paid
mediocrities who, by getting a gig in politics, earn salaries higher than a capitalist system
would ever value their talents." She explains what she sees as the idiocy of those Republican
Establishment political consultants who wrecked the campaigns of Jeb Bush and Ted Cruz by micromanaging
with pandering.
She says the Republican Establishment lost because it served itself --- becoming wealthy by
serving the moneyed interests of Wall Street. Trump won because he is speaking to the disfranchised
American Middle Class who loves our country, is proud of our traditions, and believes that Americans
have as much right to feed our families through gainful employment as do overseas workers and
illegal aliens.
"I am YOUR voice," says Trump to the Middle Class that until now has been ignored and even
sneered at by both parties' establishments.
I've given an overview of the book here. The real delight is in the details, told as only Anne
Coulter can tell them. I've quoted a few snippets of her words, that relate most specifically
to my views on Trump and the issues. I wish there were space to quote many more. Alas, you'll
need to read the book to glean them all!
Bruce, I would also add that the Republican Establishment chose not to represent the interests
of the White Middle Class on trade, immigration, and other issues that matter to us. They chose
to represent the narrow interests of:
1. The corporate 1% who believe that the global labor market should be tapped in order
to beat American workers out of their jobs; and that corporations and the 1% who own them should
be come tax-exempt organizations that profit by using cheap overseas labor to product product
that is sold in the USA, and without paying taxes on the profit. Ms. Coulter calls this group
of Republican Estblishmentarians "locusts: once they've picked America dry, they'll move on to
the next country."
2. Pretending to care about the interests of minorities. Of course, the Republican Establishment
has even less appeal to minorities than to the White Middle Class (WMC) they abandoned. Minorities
are no more interested in losing their jobs to foreigners or to suffer economic stagnation while
the rich have their increasing wealth (most of which is earned at the expense of the middle class)
tax-sheltered, than do the WMC.
The Republican Establishment is in a snit because Trump beat them by picking up the WMC votes
that the Establishment abandoned. What would have happened if Trump had not come on the scene?
The probable result is that the Establishment would have nominated a ticket of Jeb Bush and John
Kasich. These candidates had much to recommend them as popular governors of key swing states.
But they would have gone into the election fighting the campaign with Republican Establishment
issues that only matter to the 1%. They would have lost much of the WMC vote that ultimately rallied
around Trump, while gaining no more than the usual 6% of minorities who vote Republican. It would
have resulted in a severe loss for the Republican Party, perhaps making it the minority party
for the rest of the century.
Trump has given Republicans a new lease on life. The Establishment doesn't like having
to take a back seat to him, but perhaps they should understand that having a back seat in a popular
production is so much better than standing outside alone in the cold.
It's funny how White Men are supposed to be angry. But I've never seen any White men:
1. Running amok, looting and burning down their neighborhood, shooting police and other "angry
White men." There were 50 people shot in Chicago last weekend alone. How many of those do you
think were "angry white men?" Hint: they were every color EXCEPT white.
2. Running around complaining that they aren't allowed into the other gender's bathroom, then
when they barge their way in there complain about being sexually assaulted. No, it's only "angry
females" (of any ethnicity) who barge their way into the men's room and then complain that somebody
in there offended them.
Those "angry white men" are as legendary as "Bigfoot." They are alleged to exist everywhere,
but are never seen. Maybe that's because they mostly hang out in the quiet neighborhoods of cookie-cutter
homes in suburbia, go to the lake or bar-be-que on weekends, and take their allotment of Viagra
in hopes of occassionally "getting lucky" with their wives. If they're "angry" then at least they
don't take their angry frustrations out on others, as so many other militant, "in-your-face" activist
groups do!
"... I've tuned out Warren-she has become the "red meat" surrogate for Clinton. Just because Taibbi was excellent on exposing Wall St. doesn't mean he really knows s**t about politics. I find the depiction of Trump as some kind of monster-buffoon to be simply boring and not very helpful. ..."
"... (might be the Trump Chaos bc Hillary will strategically turn our war machine on us can't believe this is as good as it gets, sighed out) ..."
"... Having the establishment, the military-industrial complex and Wall Street against him helps Trump a lot. ..."
"... You can fool part of the people all the time, and all people part of the time, but Brexit won, so will Trump, politician extraordinaire ..."
"... Given his family, a Trump presidency may look more like JFK's, where Bobby had more power than LBJ. Also, given Trump's negotiating expertise, I would certainly not believe any assertion of support he proclaims for the VP. I expect he had little choice in the matter, and that he also plans to send the VP to the hinterlands at the first opportunity. I'm unclear why so many appear to believe the VP has any influence whatsoever; I believe GWB was the only post-WW2 president who let the VP have any power. ..."
"... What is a populist? Somebody that tries to do what the majority want. Current examples: Less wars and military spending. More infrastructure spending. Less support for banks and corps (imagine how many votes trump would gain if he said 'as pres I will jail bankers that break the law' And how that repudiates Obama and both parties.) Gun control (but not possible from within the rep party) ..."
"... What is a fascist? Somebody that supports corporations, military, and military adventures. ..."
"... Actually, it sounds a whole lot like a different candidate from a different party, doesn't it? ..."
"... Neoliberal "Goodthink" flag. What this means when neoliberals say it is not let's build a better global society for all it means Corporations and our military should be able to run roughshod over the world and the people's of other countries. Exploit their citizens for cheap Labor, destroy their environment and move on. These are the exact policies of Hillary Clinton (see TPP, increase foreign wars etc.). Hillary globalism is not about global Brotherhood it's about global economic and military exploitation. Trump is nationalist non – interventionist, which leads to less global military destruction than hillary and less global exploitation. So who is a better for those outside the US, hillary the interventionist OR trump the non-interventionist? ..."
"... Look, the Clintons are criminals, and their affiliate entities, including the DNC, could be considered criminal enterprises or co-conspirators at this point. ..."
"... The very fact that Establishment, Wall St and Koch bros are behind HRC is evidence that the current 'status quo' will be continued! I cannot stand another 4 years of Hilabama. ..."
"... The striving for American empire has so totally confused the political order of the country that up is down and down is up. The idea of government for and by the people is a distant memory. Covering for lies and contradictions of beliefs has blurred any notion of principles informing public action. ..."
"... If there is any principle that matters today, it is the pursuit of money and profit reigns supreme. Trump is populist in the sense he is talking about bringing money and wealth back to the working classes. Not by giving it directly, but by forcing businesses to turn their sights back to the US proper and return to making their profits at home. In the end, it is all nostalgia and probably impossible, but working class people remember those days so it rings true. That is hope and change in action. People also could care less if he cheats on his taxes or is found out lying about how much he is worth. Once again, fudging your net worth is something working people care little about. Having their share of the pie is all that matters and Trump is tapping into that. ..."
"... The only crime Trump has committed so far is his language. Liberals like Clinton, Blair and Obama drip blood. ..."
"... The 2016 election cannot be looked at in isolation. The wars for profit are spreading from Nigeria through Syria to Ukraine. Turkey was just lost to the Islamists and is on the road to being a failed state. The EU is in an existential crisis due to Brexit, the refugee crisis and austerity. Western leadership is utterly incompetent and failing to protect its citizens. Globalization is failing. Its Losers are tipping over the apple cart. Humans are returning to their tribal roots for safety. The drums for war with Russia are beating. Clinton / Kaine are 100% Status Quo Globalists. Trump / Pence are candidates of change to who knows what. Currently I am planning on voting for the Green Party in the hope it becomes viable and praying that the chaos avoids Maryland. ..."
I've tuned out Warren-she has become the "red meat" surrogate for Clinton. Just because
Taibbi was excellent on exposing Wall St. doesn't mean he really knows s**t about politics. I
find the depiction of Trump as some kind of monster-buffoon to be simply boring and not very helpful.
for all the run around Hillary, Trump's chosen circle of allies are Wall Street and Austerity
enablers. actually, Trump chaos could boost the enablers as easily as Hillary's direct mongering.
War is Money low hanging fruit in this cash strapped era and either directly or indirectly neither
candidate will disappoint.
So I Ask Myself which candidate will the majority manage sustainability while assembling to create
different outcomes? (might be the Trump Chaos bc Hillary will strategically turn our war machine
on us can't believe this is as good as it gets, sighed out)
War is only good for the profiteers when it can be undertaken in another territory. Bringing
the chaos home cannot be good for business. Endless calls for confidence and stability in markets
must reflect the fact that disorder effects more business that the few corporations that benefit
directly from spreading chaos. A split in the business community seems to be underway or at least
a possible leverage point to bring about positive change.
Even the splits in the political class reflect this. Those that benefit from spreading chaos are
loosing strength because they have lost control of where that chaos takes place and who is directly
effected from its implementation. Blowback and collateral damage are finally registering.
Trump may be a disaster. Clinton will be a disaster. One of these two will win. I won't vote
for either, but if you put a gun to my head and forced me to choose, I'd take Trump. He's certainly
not a fascist (I think it was either Vice or Vox that had an article where they asked a bunch
of historians of fascism if he was, the answer was a resounding no), he's a populist in the Andrew
Jackson style. If nothing else Trump will (probably) not start WW3 with Russia.
And war with Russia doesn't depend just on Hillary, it depends on us in Western Europe agreeing
with it.
A laughable proposition. The official US policy, as you may recall, is
fuck the EU .
Where was Europe when we toppled the Ukrainian govt? Get back to me when you can actually spend
2% GDP on your military. At the moment you can't even control your illegal immigrants.
The political parties that survive display adaptability, and ideological consistency isn't
a requirement for that. Look at the party of Lincoln. Or look at the party of FDR.
If the Democrats decapitate the Republican party by bringing in the Kagans of this world and
Republican suburbanites in swing states, then the Republicans will go where the votes are; the
Iron Law of Institutions will drive them to do it, and the purge of the party after Trump will
open the positions in the party for people with that goal.
In a way, what we're seeing now is what should have happened to the Republicans in
2008. The Democrats had the Republicans down on the ground with Obama's boot on their neck. The
Republicans had organized and lost a disastrous war, they had lost the legislative and executive
branches, they were completely discredited ideologically, and they were thoroughly discredited
in the political class and in the press.
Instead, Obama, with his strategy of bipartisanship - good faith or not - gave them a hand
up, dusted them off, and let them right back in the game, by treating them as a legitimate opposition
party. So the Republican day of reckoning was postponed. We got various bids for power by factions
- the Tea Party, now the Liberty Caucus - but none of them came anywhere near taking real power,
despite (click-driven money-raising) Democrat hysteria.
And now the day of reckoning has arrived. Trump went through the hollow institutional shell
of the Republican Party like the German panzers through the French in 1939. And here we are!
(Needless to say, anybody - ***cough*** Ted Cruz ***cough*** - yammering about "conservative
principles" is part of the problem, dead weight, part of the dead past.) I don't know if the Republicans
can remake themselves after Trump; what he's doing is necessary for that, but may not be sufficient.
Republicans won Congress and the states because the Democrats handed them to them on a silver
platter. To Obama and his fan club meaningful power is a hot potato, to be discarded as soon as
plausible.
Having the establishment, the military-industrial complex and Wall Street against him helps
Trump a lot.
Pro-Sanders folks, blacks, and hispanics will mostly vote for Trump.
Having Gov. Pence on the ticket, core Republicans and the silent majority will vote for Trump.
Women deep inside know Trump will help their true interests better than the Clinton-Obama rinse
repeat
Young people, sick and tired of the current obviously rigged system, will vote for change.
You can fool part of the people all the time, and all people part of the time, but Brexit
won, so will Trump, politician extraordinaire
Even Michael Moore gets it
Trump has intimated that he is not going to deal with the nuts and bolts of government,
that will be Pence's job.
Given his family, a Trump presidency may look more like JFK's, where Bobby had more power
than LBJ.
Also, given Trump's negotiating expertise, I would certainly not believe any assertion of support
he proclaims for the VP. I expect he had little choice in the matter, and that he also plans to
send the VP to the hinterlands at the first opportunity. I'm unclear why so many appear to believe
the VP has any influence whatsoever; I believe GWB was the only post-WW2 president who let the
VP have any power.
Minorities will benefit at least as much as whites with infrastructure spending, which trump
says he wants to do It would make him popular, which he likes, why not believe him? And if pres
he would be able to get enough rep votes to get it passed. No chance with Hillary, who anyway
would rather spend on wars, which are mostly fought by minorities.
What is a populist? Somebody that tries to do what the majority want. Current examples:
Less wars and military spending. More infrastructure spending. Less support for banks and corps
(imagine how many votes trump would gain if he said 'as pres I will jail bankers that break the
law' And how that repudiates Obama and both parties.) Gun control (but not possible from within
the rep party)
What is a fascist? Somebody that supports corporations, military, and military adventures.
I'm saying you have a much better chance to pressure Clinton
Sorry, but this argues from facts not in evidence and closely resembles the Correct the Record
troll line (now substantiated through the Wikileaks dump) that Clinton "has to be elected" because
she is at least responsive to progressive concerns.
Except she isn't, and the degree to which the DNC clearly has been trying to pander to disillusioned
Republicans and the amount of bile they spew every time they lament how HRC has had to "veer left"
shows quite conclusively to my mind that, in fact, the opposite of what you say is true.
Also, when NAFTA was being debated in the '90s, the Clintons showed themselves to be remarkably
unresponsive both to the concerns of organized labor (who opposed it) as well as the majority
of the members of their own party, who voted against it. NAFTA was passed only with a majority
of Republican votes.
I have no way of knowing whether you're a troll or sincerely believe this, but either way,
it needs to be pointed out that the historical record actually contradicts your premise. If you
do really believe this, try not to be so easily taken in by crafty rhetoric.
BTW, I'll take Trump's record as a husband over HRC's record as a wife. He loves a woman, then
they break up, and he finds another one. This is not unusual in the US. Hillary, OTOH, "stood
by her man" through multiple publicly humiliating infidelities, including having to settle out
of court for more than $800,000, and rape charges. No problem with her if her husband was flying
many times on the "Lolita Express" with a child molester. Could be she had no idea where her "loved
one" was at the time. Do they in fact sleep in the same bed, or even live in the same house? I
don't know.
RE: calling Donald Trump a "sociopath"-this is another one of those words that is thrown around
carelessly, like "nazi" and "fascist". In the Psychology Today article "How to Spot a Sociopath",
they list 16 key behavioral characteristics. I can't see them in Trump-you could make a case for
a few of them, but not all. For example: "failure to follow any life plan", "sex life impersonal,
trivial, and poorly integrated", "poor judgment and failure to learn by experience", "incapacity
for love"-–you can't reasonably attach these characteristics to The Donald, who, indeed, has a
more impressive and loving progeny than any other prez candidate I can think of.
"I have a sense of international identity as well: we are all brothers and sisters."
Neoliberal "Goodthink" flag. What this means when neoliberals say it is not let's build
a better global society for all it means Corporations and our military should be able to run roughshod
over the world and the people's of other countries. Exploit their citizens for cheap Labor, destroy
their environment and move on. These are the exact policies of Hillary Clinton (see TPP, increase
foreign wars etc.). Hillary globalism is not about global Brotherhood it's about global economic
and military exploitation. Trump is nationalist non – interventionist, which leads to less global
military destruction than hillary and less global exploitation. So who is a better for those outside
the US, hillary the interventionist OR trump the non-interventionist?
"And not everyone feels the same way, but for most voters there is either a strong tribal loyalty
(Dem or Repub) or a weaker sense of "us" guiding the voter on that day.
Mad as I am about the Blue Dogs, I strongly identify with the Dems."
So you recognize you are a tribalist, and assume all the baggage and irrationality that tribalism
often fosters, but instead of addressing your tribalism you embrace it. What you seem to be saying
(to me)is that we should leave critical thinking at the door and become dem tribalists like you.
"But the Repubs and Dems see Wall Street issues through different cultural prisms. Republican
are more reflexively pro-business. It matters."
Hillary Clinton's biggest donors are Wallstreet and her dem. Husband destroyed glass-steagall.
Trump wants to reinstate glass-steagall, so who is more business friendly again?
"He is racist, and so he knows how to push ugly buttons."
This identity politics trope is getting so old. Both are racist just in different ways, Trump
says in your face racist things, which ensure the injustice cannot be ignored, where hillary has
and does support racist policies, that use stealth racism to incrementaly increase the misery
of minorities, while allowing the majority to pretend it's not happening.
"First, he will govern with the Republicans. Republican judges, TPP, military spending, environmental
rollbacks, etc. Trump will not overrule Repubs in Congress."
These are literally hillarys policies not trumps.
Trump: anti TPP, stop foreign interventions, close bases use money for infrastructure.
Hillary :Pro TPP, more interventions and military spending
"And no, no great Left populist party will ride to the rescue. The populist tradition (identity)
is mostly rightwing and racist in our society.
People do not change political identity like their clothes. The left tradition in the US, such
as it is, is in the Dem party."
So what you are saying is quit being stupid, populism is bad and you should vote for hillarys
neoliberalism. The democrats were once left so even if they are no longer left, we must continue
to support them if another party or candidate that is to the left isn't a democrat? Your logic
hurts my head.
Look, the Clintons are criminals, and their affiliate entities, including the DNC, could
be considered criminal enterprises or co-conspirators at this point. Those who haven't realized
that, or worse, who shill for them are willfully ignorant, amoral, or unethical. The fact that
that includes a large chunk of the population doesn't change that. I don't vote for criminals.
The very fact that Establishment, Wall St and Koch bros are behind HRC is evidence that
the current 'status quo' will be continued! I cannot stand another 4 years of Hilabama.
I hate Hillary more than Trump. I want to protest at the Establishment, which at this represented
by Hillary.
Populism (support for popular issues) is, well, popular.
Fascism (support for corps and military adventures) is, at least after our ME adventures, unpopular.
Commenters are expressing support for the person expressing popular views, such as infrastructure
spending, and expressing little support for the candidate they believe is most fascist.
Btw, Most on this site are liberals, few are reps, so to support him they have had to buck
some of their long held antipathy regarding reps.
Right, what is changing with Trump is the Republicans are going back to, say, the Eisenhower
era, when Ike started the interstate highway system, a socialist program if there ever was one.
It's a good article; this is a general observation. Sorry!
"Hate" seems to be a continuing Democrat meme, and heck, who can be for hate? So it makes sense
rhetorically, but in policy terms it's about as sensible as being against @ssh0les (since as the
good book says, ye have the @ssh0les always with you). So we're really looking at virtue signaling
as a mode of reinforcing tribalism, and to be taken seriously only for that reason. If you look
at the political class writing about the working class - modulo writers like Chris Arnade - the
hate is plain as day, though it's covered up with the rhetoric of meritocracy, taking care of
losers, etc.
Strategic hate management is a great concept. It's like hate can never be created or destroyed,
and is there as a resource to be mined or extracted. The Clinton campaign is doing a great job
of strategic hate management right now, by linking Putin and Trump, capitalizing on all the good
work done in the press over the last year or so.
For years we have been told that government should be run like a business. In truth that statement
was used as a cudgel to avoid having the government provide any kind of a safety net to its citizenry
because there was little or no profit in it for the people who think that government largess should
only be for them.
Here's the thing, if government had been run like a business, we the people would own huge
portions of Citigroup, Goldman Sachs and Chase today. We wouldn't have bailed them out without
an equity stake in them. Most cities would have a share of the gate for every stadium that was
built. And rather than paying nothing to the community Walmart would have been paying a share
of their profits (much as those have dropped over the years).
I do not like Trump's business, but he truly does approach his brand and his relationships
as a business. When he says he doesn't like the trade deals because they are bad business and
bad deals he is correct. IF the well being of the United states and his populace are what you
are interested in regarding trade deals, ours are failures. Now most of us here know that was
not the point of the trade deals. They have been a spectacular success for many of our largest
businesses and richest people, but for America as a whole they have increased our trade deficit
and devastated our job base. When he says he won't go there, this is one I believe him on.
I also believe him on NATO and on the whole Russian thing. Why, because of the same reasons
I believe him on Trade. They are not winners for America as a whole. They are bad deals. Europe
is NOT living up to their contractual agreement regarding NATO. For someone who is a believer
in getting the better of the deal that is downright disgusting. And he sees no benefit in getting
into a war with Russia. The whole reserve currency thing vs. nukes is not going to work for him
as a cost benefit analysis of doing it. He is not going to front this because it is a business
loser.
We truly have the worst choices from the main parties in my lifetime. There are many reasons
Trump is a bad candidate. But on these two, he is far more credible and on the better side of
things than the Democratic nominee. And on the few where she might reasonably considered to have
a better position, unfortunately I do not for a moment believe her to be doing more than giving
lip service based on both her record and her character.
Is it your opinion that to have globalisation we must marginalize russia to the extent that
they realize they can't have utopia and make the practical choice of allowing finance capitalism
to guide them to realistic incrementally achieved debt bondage?
The Democratic Party has been inching further and further to the right. Bernie tried to arrest
this drift, but his internal populist rebellion was successfully thwarted by party elite corruption.
The Democratic position is now so far to the right that the Republicans will marginalize themselves
if they try to keep to the right of the Democrats.
But, despite party loyalty or PC slogans, the Democrat's rightward position is now so obvious
that it can be longer disguised by spin. The Trump campaign has demonstrated, the best electoral
strategy for the Republican Party is to leapfrog leftward and campaign from a less corporate position.
This has given space for the re-evaluation of party positions that Trump is enunciating, and the
result is that the Trump is running to the
left of Hillary. How weird is this?
I meant to use right and left to refer generally to elite vs popular. The issue is too big
to discuss without some simplification, and I'm sorry it has distracted from the main issue. On
the face of it, judging from the primaries, the Republican candidates who represented continued
rightward drift were rejected. (Indications are that the same thing happened in the Democratic
Party, but party control was stronger there, and democratic primary numbers will never be known).
The main point I was trying to make is that the Democratic party has been stretching credulity
to the breaking point in claiming to be democratic in any sense, and finally the contradiction
between their statements and actions has outpaced the capabilities of their propaganda. Their
Orwellian program overextended itself. Popular recognition of the disparity has caused a kind
of political "snap" that's initiated a radical reorganization of what used to be the party of
the right (or corporations, or elites, or finance, or "your description here".)
Besides confusion between which issues are right or left for Republicans or Democrats on the
national level, internationally, the breakdown of popular trust in the elites, and the failure
of their propaganda on that scale, is leading to a related worldwide distrust and rejection of
elite policies. This distrust has been percolating in pockets for some time, but it seems it's
now become so widespread that it's practically become a movement.
I suspect, however, there's a Plan B for this situation to restore the proper order. Will be
interesting to see how this plays out.
The striving for American empire has so totally confused the political order of the country
that up is down and down is up. The idea of government for and by the people is a distant memory.
Covering for lies and contradictions of beliefs has blurred any notion of principles informing
public action.
If there is any principle that matters today, it is the pursuit of money and profit reigns
supreme. Trump is populist in the sense he is talking about bringing money and wealth back to
the working classes. Not by giving it directly, but by forcing businesses to turn their sights
back to the US proper and return to making their profits at home. In the end, it is all nostalgia
and probably impossible, but working class people remember those days so it rings true. That is
hope and change in action. People also could care less if he cheats on his taxes or is found out
lying about how much he is worth. Once again, fudging your net worth is something working people
care little about. Having their share of the pie is all that matters and Trump is tapping into
that.
Clintons arrogance is worse because the transcripts probably clearly show her secretly conspiring
with bankers to screw the working people of this country. Trumps misdeeds effect his relationship
to other elites while Clintons directly effect working people.
Such a sorry state of affairs. When all that matters is the pursuit of money and profit, moving
forward will be difficult and full of moral contradictions. Populism needs a new goal. The political
machinery that gives us two pro-business hacks and an ineffectual third party has fundamentally
failed.
The business of America must be redefined, not somehow brought back to a mythical past greatness.
Talk about insanity.
"Bill Clinton has been a disaster for the Democratic Party. Send him packing."
"There's not much the Democrats can do about Mrs. Clinton. She's got a Senate seat for six
years. But there is no need for the party to look to her for leadership. The Democrats need to
regroup, re-establish their strong links to middle-class and working-class Americans, and move
on."
"You can't lead a nation if you are ashamed of the leadership of your party. The Clintons are
a terminally unethical and vulgar couple, and they've betrayed everyone who has ever believed
in them."
"As neither Clinton has the grace to retire from the scene, the Democrats have no choice but
to turn their backs on them. It won't be easy, but the Democrats need to try. If they succeed
they'll deserve the compliment Bill Clinton offered Gennifer Flowers after she lied under oath:
"Good for you." "
Amazing how the New York Times has "evolved" from Herbert's editorial stance of 15 years ago
to their unified editorial/news support for HRC's candacy,
In my view, it is not as if HRC has done anything to redeem herself in the intervening years.
It takes liberals to create a refugee crisis.
What country are we going to bomb back into the stone age this week?
We are very squeamish about offensive language.
We don't mind dropping bombs and ripping people apart with red hot shrapnel.
We are liberals.
Liberal sensibilities were on display in the film "Apocalypse Now".
No writing four letter words on the side of aircraft.
Napalm, white phosphorous and agent orange – no problem.
Liberals are like the English upper class – outward sophistication hiding the psychopath underneath.
They were renowned for their brutality towards slaves, the colonies and the English working class
(men, women and children) but terribly sophisticated when with their own.
Are you a bad language sort of person – Trump
Or a liberal, psychopath, empire builder – Clinton
The only crime Trump has committed so far is his language. Liberals like Clinton, Blair
and Obama drip blood.
Lambert strether said: my view is that the democrat party cannot be saved, but it can be seized.
Absolutely correct.
That is why Trump must be elected. Only then through the broken remains of both Parties can the
frangible Democrat Party be seized and restored.
The 2016 election cannot be looked at in isolation. The wars for profit are spreading from
Nigeria through Syria to Ukraine. Turkey was just lost to the Islamists and is on the road to
being a failed state. The EU is in an existential crisis due to Brexit, the refugee crisis and
austerity. Western leadership is utterly incompetent and failing to protect its citizens. Globalization
is failing. Its Losers are tipping over the apple cart. Humans are returning to their tribal roots
for safety. The drums for war with Russia are beating. Clinton / Kaine are 100% Status Quo Globalists.
Trump / Pence are candidates of change to who knows what. Currently I am planning on voting for
the Green Party in the hope it becomes viable and praying that the chaos avoids Maryland.
"... Because we interpreted the end of the Cold War as the ultimate vindication of America's economic system, we intensified our push toward the next level of capitalism, called globalization. It was presented as a project that would benefit everyone. Instead it has turned out to be a nightmare for many working people. Thanks to "disruption" and the "global supply chain," many American workers who could once support families with secure, decent-paying jobs must now hope they can be hired as greeters at Walmart. Meanwhile, a handful of super-rich financiers manipulate our political system to cement their hold on the nation's wealth. ..."
"... Rather than shifting to a less assertive and more cooperative foreign policy, we continued to insist that America must reign supreme. When we declared that we would not tolerate the emergence of another "peer power," we expected that other countries would blithely obey. Instead they ignore us. We interpret this as defiance and seek to punish the offenders. That has greatly intensified tensions between the United States and the countries we are told to consider our chief adversaries, Russia and China. ..."
Because we interpreted the end of the Cold War as the ultimate vindication
of America's economic system, we intensified our push toward the next level
of capitalism, called globalization. It was presented as a project that
would benefit everyone. Instead it has turned out to be a nightmare for
many working people. Thanks to "disruption" and the "global supply chain,"
many American workers who could once support families with secure, decent-paying
jobs must now hope they can be hired as greeters at Walmart. Meanwhile,
a handful of super-rich financiers manipulate our political system to cement
their hold on the nation's wealth.
Enrique Ferro's insight:
Moments of change require adaptation, but the United States is not good
at adapting. We are used to being in charge. This blinded us to the reality
that as other countries began rising, our relative power would inevitably
decline. Rather than shifting to a less assertive and more cooperative
foreign policy, we continued to insist that America must reign supreme.
When we declared that we would not tolerate the emergence of another "peer
power," we expected that other countries would blithely obey. Instead they
ignore us. We interpret this as defiance and seek to punish the offenders.
That has greatly intensified tensions between the United States and the
countries we are told to consider our chief adversaries, Russia and China.
This is downright sickening and the people who are voting for Hillary will not even care what will
happen with the USA iif she is elected.
By attacking Trump using "Khan gambit" she risks a violent backlash (And not only via Wikileaks,
which already promised to release information about her before the elections)
People also start to understand that she is like Trump. He destroyed several hundred American lifes
by robbing them, exploiting their vanity (standard practice in the USA those days) via Trump University
scam. She destroyed the whole country -- Libya and is complicit in killing Khaddafi (who, while not
a nice guy, was keeping the country together and providing be highest standard of living in Africa for
his people).
In other words she is a monster and sociopath. He probably is a narcissist too. So there is no much
phychological difference between them. And we need tight proportions to judge this situation if we are
talking about Hillary vs Trump.
As for people voting for Trump -- yes they will. I think if Hillary goes aganst Trump, the female
neoliberal monster will be trumped. She has little chances even taking into account the level of brainwashing
in the USA (which actually is close to those that existed in the USSR).
Notable quotes:
"... The reason Trump and Sanders are doing well in the US while fascists are doing well in Europe is the same reason: neoliberalism has gutted, or is in the process of gutting, societies. Workers and other formerly "safe" white collar workers are seeing their job security, income security, retirement security all go up in smoke. Neoliberals are trying to snip and cut labor protections, healthcare, environmental regulations all for corporate profit. In Europe this is all in addition to a massive refugee crisis itself brought on by neoliberalism (neocon foreign policy is required for neoliberal social policy, they go hand-in-hand). The US and NATO destabilize countries with the intent of stealing their resources and protecting their markets, cause massive refugee flows which strain social structures in Europe (which falls right into the hands of the gutters and cutters of neoliberalism). Of course the people will lean fascist. ..."
"... U.S. Government Tried to Tackle Gun Violence in 1960s ..."
"... Another key feature of fascism is territorial expansionism. As far as I am aware, none of the nationalist parties advocate invading other countries or retaking former colonies. Once again, contemporary neoliberalism is far closer to fascism. But you are correct about both Israel and Turkey – our allies. They are much closer to the genuine article. But you won't hear those complaining about the rise of fascism in Europe complaining too much about them. ..."
"... The only way they have avoided complete revolt has been endless borrowing to fund entitlements, once that one-time fix plays out the consequences will be apparent. The funding mechanism itself (The Fed) has even morphed into a neo-liberal tool designed to enrich Capital while enslaving Labor with the consequences. ..."
"... "Every society chooses how resources are allocated between capital and labor." More specifically, isn't it a struggle between various political/economic/cultural movements within a society which chooses how resources are allocated between capital and labor. ..."
"... My objection to imprecise language here isn't merely pedantic. The leftist dismissal of right wing populists like Trump (or increasingly influential European movements like Ukip, AfD, and the Front national) as "fascist" is a reductionist rhetorical device intended to marginalize them by implying their politics are so far outside of the mainstream that they do not need to be taken seriously. ..."
"... " the gutters and cutters of neoliberalism" ..."
"... The neoliberals are all too aware that the clock is ticking. In this morning's NYT, yet more talk of ramming TPP through in the lame duck. ..."
"... The roads here are deteriorating FAST. In Price County, the road commissioner said last night that their budget allows for resurfacing all the roads on a 200 year basis. ..."
"... This Trump support seems like a form of political vandalism with Trump as the spray paint. People generally feel frustrated with government, utterly powerless and totally left out as the ranks of the precariat continue to grow. Trump appeals to the nihilistic tendencies of some people who, like frustrated teens, have decided to just smashed things up for the hell of it. They think a presidency mix of Caligula with Earl Scheib would be a funny hoot. ..."
"... Someone at American Conservative, when trying to get at why it's pointless to tell people Trump will wreck the place, described him as a "hand grenade" lobbed into the heart of government. You can't scare people with his crass-ness and destructive tendencies, because that's precisely what his voters are counting on when/if he gets into government. ..."
"... In other words, the MSM's fear is the clearest sign to these voters that their ..."
"... Your phrase "Trump is political vandalism" is great. I don't think I've seen a better description. NPR this morning was discussing Trump and his relationship with the press and the issues some GOP leaders have with him. When his followers were discussed, the speakers closely circled your vandalism point. Basically they said that his voters are angry with the power brokers and leaders in DC and regardless of whether they think Trump's statements are heartfelt or just rhetoric, they DO know he will stick it to those power brokers so that's good. Vandalism by a longer phrase. ..."
"... Meritocracy was ALWAYS a delusional fraud. What you invariably get, after a couple of generations, is a clique of elitists who define merit as themselves and reproduce it ad nauseam. Who still believes in such laughable kiddie stories? ..."
"... Campaign Finance Reform: If you can't walk into a voting booth you cannot contribute, or make all elections financed solely by government funds and make private contributions of any kind to any politician illegal. ..."
"... Re-institute Glass-Steagall but even more so. Limit the number of states a bank can operate in. Make the Fed publicly owned, not privately owned by banks. Completely revise corporate law, doing away with the legal person hood of corporations and limit of liability for corporate officers and shareholders. ..."
"... Single payer health care for everyone. Allow private health plans but do away with health insurance as a deductible for business. Remove the AMA's hold on licensing of medical schools which restricts the number of doctors. ..."
"... Do away with the cap on Social Security wages and make all income, wages, capital gains, interest, and dividends subject to taxation. Impose tariffs to compensate for lower labor costs overseas and revise industry. ..."
"... Cut the Defense budget by 50% and use that money for intensive infrastructure development. ..."
"... Raise the national minimum wage to $15 and hour. ..."
"... Severely curtail the revolving door from government to private industry with a 10 year restriction on working for an industry you dealt with in any way as a government official. ..."
"... Free public education including college (4 year degree). ..."
"... Obama and Holder, allowing the banks to be above the law have them demi-gods, many of whom are psychopaths and kleptocrats, and with their newly granted status, they are now re-shaping the world in their own image. Prosecute these demi-gods and restore sanity. Don't and their greed for our things will never end until nothings left. ..."
"... This is why Hillary is so much more dangerous than trump, because she and the demi gods are all on the same page. The TPP is their holy grail so I expect heaven and earth to be moved, especially if it looks like some trade traitors are going to get knocked off in the election, scoundrels like patty murray (dino, WA) will push to get it through then line up at the feed trough to gorge on k street dough. I plan to vote stein if it's not Bernie, but am reserving commitment until I see what kind of betrayals the dems have for me, if it's bad enough I'll go with the trump hand grenade. ..."
"... Totally agree tegnost, no more democratic neoliberals -- ..."
"... "they are now re-shaping the world in their own image" Isn't this intrinsic to bourgeois liberalism? ..."
"... Two things are driving our troubles: over-population and globalization. The plutocrats and kleptocrats have all the leverage over the rest of us laborers when the population of human beings has increased seven-fold in the last 70 years, from a little over a billion to seven billions (and growing) today. They are happy to let us freeze to death behind gas stations in order for them to compete with other oligarchs in excess consumption. ..."
"... Thank you for mentioning the third rail of overpopulation. Too often, this giant category of problems is ignored, because it makes people uncomfortable. The planet is finite, resources on the planet are finite, yet the number of people keeps growing. We need to strive for a higher quality of life, not a higher quantity of people. ..."
"... The issue goes beyond "current neoliberals up for election", it is most of our political establishment that has been corrupted by a system that provides for the best politicians money can buy. ..."
"... America has always been a country where a majority of the population has been poor. With the exception of a fifty five year(1950-2005) year period where access to large quantities of consumer debt by households was deployed to first to provide a wealth illusion to keep socialism at bay, followed by a mortgage debt boom to both keep the system afloat and strip the accumulated capital of the working class, i.e. home equity, the history of the US has been one of poverty for the masses. ..."
"... Further debt was foisted on the working class in the form of military Keynesianism, generating massive fiscal deficits which are to be paid for via austerity in a neo-feudal economy. ..."
The first comment gives a window into the hidden desperation in America that is showing up in statistics
like increasing opioid addiction and suicides, rather than in accounts of how and why so many people
are suffering. I hope readers will add their own observations in comments.
We recently took three months to travel the southern US from coast to coast. As an expat for
the past twenty years, beyond the eye opening experience it left us in a state of shock. From
a homeless man convulsing in the last throes of hypothermia (been there) behind a fuel station
in Houston (the couldn't care less attendant's only preoccupation getting our RV off his premises),
to the general squalor of near-homelessness such as the emergence of "American favelas" a block
away from gated communities or affluent ran areas, to transformation of RV parks into permanent
residencies for the foreclosed who have but their trailer or RV left, to social study one can
engage while queuing at the cash registers of a Walmart before beneficiaries of SNAP.
Stopping to take the time to talk and attempt to understand their predicament and their beliefs
as to the cause of their plight is a dizzying experience in and of itself. For a moment I felt
transposed to the times of the Cold War, when the Iron Curtain dialectics fuzzed the perception
of that other world to the west with a structured set of beliefs designed to blacken that horizon
as well as establish a righteous belief in their own existential paradigm.
What does that have to do with education? Everything if one considers the elitist trend that
is slowly setting the framework of tomorrow's society. For years I have felt there is a silent
"un-avowed conspiracy", why the seeming redundancy, because it is empirically driven as a by-product
of capitalism's surge and like a self-redeeming discount on a store shelf crystalizes a group
identity of think-alike know-little or nothing frustrated citizens easily corralled by a Fox or
Trump piper. We have re-rcreated the conditions or rather the reality of "Poverty In America"
barely half a century after its first diagnostic with one major difference : we are now feeding
the growth of the "underclass" by lifting ever higher and out of reach the upward mobility ladder,
once the banner of opportunity now fallen behind the supposedly sclerotic welfare states of Europe.
So Richard Cohen now fears American voters because of Trump. Well, on Diane Reem today (NPR)
was a discussion on why fascist parties are growing in Europe. Both Cohen and the clowns on NPR
missed the forest for the trees. The reason Trump and Sanders are doing well in the US while
fascists are doing well in Europe is the same reason: neoliberalism has gutted, or is in the process
of gutting, societies. Workers and other formerly "safe" white collar workers are seeing their
job security, income security, retirement security all go up in smoke. Neoliberals are trying
to snip and cut labor protections, healthcare, environmental regulations all for corporate profit.
In Europe this is all in addition to a massive refugee crisis itself brought on by neoliberalism
(neocon foreign policy is required for neoliberal social policy, they go hand-in-hand). The US
and NATO destabilize countries with the intent of stealing their resources and protecting their
markets, cause massive refugee flows which strain social structures in Europe (which falls right
into the hands of the gutters and cutters of neoliberalism). Of course the people will lean fascist.
In the US we don't have the refugees, but the neoliberalism is further along and more damaging.
There's no mystery here or in Europe, just the natural effects of governments failing to represent
real people in favor of useless eater rich.
Make the people into commodities, endanger their washes and job security, impose austerity,
and tale in floods of refugees. Of COURSE Europeans stay leaning fascist.
According to NPR's experts, many or most of those parties are "fascist". The fascist label
is getting tossed around a LOT right now. It is slung at Trump, at UKIP, or any others. Fascist
is what you call the opposition party to the right that you oppose. Now I don't call Trump a fascist.
A buffoon, yes, even a charlatan (I still rather doubt he really originally thought he would become
the GOP nominee. Perhaps I'm wrong but, like me, many seemed to think that he was pushing his
"brand" – a term usage of which I HATE because it IS like we are all commodities or businesses
rather than PEOPLE – and that he would drop by the wayside and profit from his publicity).
Be that as it may, NPR and Co were discussing the rise of fascist/neofascist parties and wondering
why there were doing so well. Easy answer: neoliberalism + refugee hoards = what you see in Europe.
I've also blamed a large part of today's gun violence in the USA on the fruits of neoliberalism.
Why? Same reason that ugly right-wing groups (fascist or not) are gaining ground around the Western
world. Neoliberalism destroys societies. It destroys the connections within societies (the USA
in this case). Because we have guns handy, the result is mass shootings and flashes of murder-suicides.
This didn't happen BEFORE neoliberalism got its hooks into American society. The guns were there,
always have been (when I was a teen I recall seeing gun mags advertising various "assault weapons"
for sale this was BEFORE Reagan and this was BEFORE mass shootings, etc). Machine guns were much
easier to come by BEFORE the 1980s yet we didn't have mass killings with machine guns, handguns,
or shotguns. ALL that stuff is a NEW disease. A disease rooted in neoliberalism. Neoliberalism
steals your job security, your healthcare security, your home, your retirement security, your
ability to provide for your family, your ability to send your kids to college, your ability to
BUY FOOD. Neoliberalism means you don't get to work for a company for 20 years and then see the
company pay you back for that long, good service with a pension. You'll be lucky to hold a job
at any company from month-to-month now and FORGET about benefits! Healthcare? Going by the wayside
too. Workers in the past felt a bond with each other, especially within a company. Neoliberalism
has turned all workers against each other because they have to fight to gain any of the scraps
being tossed out by the rich overlords. You can't work TOGETHER to gain mutual benefit, you need
to fight each other in a zero sum game. For ME to win you have to lose. You are a commodity. A
disposable and irrelevant widget. THAT combines with guns (that have always been available!) and
you get desperate acting out: mass shootings, murder suicides, etc.
There are actual fascist parties in Europe. To name a few in one country I've followed, Ukraine,
there's Right Sector, Svoboda, and others, and that's just one country. I don't think anyone calls
UKIP fascist.
@Praedor – Your comment that Yves posted and this one are excellent. One of the most succinct
statements of neoliberalism and its worst effects that I have seen.
As to the cause of recent mass gun violence, I think you have truly nailed it. If one thinks
at all about the ways in which the middle class and lower have been squeezed and abused, it's
no wonder that a few of them would turn to violence. It's the same despair and frustration that
leads to higher suicide rates, higher rates of opiate addiction and even decreased life expectancy.
"Machine guns were much easier to come by BEFORE the 1980s yet we didn't have mass killings
with machine guns, handguns, or shotguns. ALL that stuff is a NEW disease. A disease rooted in
neoliberalism."
Easy availability of guns was seen as a serious problem long before the advent of neoliberalism.
For one example of articles about this, see U.S. Government Tried to Tackle Gun Violence in
1960s . Other examples include 1920s and 1930s gangster and mob violence that were a consequence
of Prohibition (of alcohol). While gun violence per-capita might be increasing, the population
is far larger today, and the news media select incidents of violence to make them seem like they're
happening everywhere and that everyone needs to be afraid. That, of course, instills a sense of
insecurity and fear into the public mind; thus, a fearful public want a strong leader and are
willing to accept the inconvenience and dangers of a police state for protection.
America has plenty of refugees, from Latin America
Neo-liberal goes back to the Monroe Doctrine. We used to tame our native workers with immigrants,
and we still do, but we also tame them by globalism in trade. So many rationalizations for this,
based on political and economic propaganda. All problems caused by the same cause American predatory
behavior. And our great political choice iron fist with our without velvet glove.
Germany, Belgium, France, Poland, Hungary, Romania, Turkey, Israel, Australia come to mind
(if one is allowed to participate in a European song contest, one is supposed to be part of Europe
:) They all have more or less fascist governments.
Once you realize that the ECB creates something like 60 billion euros a month, and gives nothing
to its citizens nor its nation-states, that means the money goes to corporations, which means
that the ECB, and by extension the whole EU, is a fascist construct (fascism being defined as
a government running on behalf of the corporations).
That's a fallacy. Corporatism is a feature of fascism, not the other way around.
None of the governments you mention, with the possible exception of Israel and Turkey, can
be called fascist in any meaningful sense.
Even the anti-immigration parties in the Western European countries you mention – AfD, Front
National, Vlaams Belang – only share their nationalism with fascist movements. And they are decidedly
anti-corporatist.
The problem here is one of semantics, really. You're using "fascist" interchangeably with "authoritarian",
which is a misnomer for these groups. The EU is absolutely anti-democratic, authoritarian, and
technocratic in a lot of respects, but it's not fascist. Both have corporatist tendencies, but
fascist corporatism was much more radical, much more anti-capitalist (in the sense that the capitalist
class was expected to subordinate itself to the State as the embodiment of the will of the Nation
or People, as were the other classes/corporate units). EU technocratic corporatism has none of
the militarism, the active fiscal policy, the drive for government supported social cohesion,
the ethno-nationalism, or millenarianism of Fascism.
The emergent Right parties like UKIP, FNP, etc. share far more with the Fascists, thought I'd
say they generally aren't yet what Fascists would have recognized as other Fascists in the way
that the NSDAP and Italian Fascists recognized each other -perhaps they're more like fellow travelers.
True, I posted a few minutes ago saying roughly the same thing – but it seems to have gone
to moderation.
Another key feature of fascism is territorial expansionism. As far as I am aware, none
of the nationalist parties advocate invading other countries or retaking former colonies. Once
again, contemporary neoliberalism is far closer to fascism. But you are correct about both Israel
and Turkey – our allies. They are much closer to the genuine article. But you won't hear those
complaining about the rise of fascism in Europe complaining too much about them.
When I was young, there were 4 divisions:
* who owned the means of production (public or private entities)
* who decided what those means were used for.
If it is a 'public entity' (aka government or regime) that decides what is built, we have a totalitarian
state, which can be 'communist' (if the means also belong the public entities like the government
or regional fractions of it) or 'fascist' (if the factories are still in private hands).
If it is the private owner of the production capacity who decides what is built, you get capitalism.
I don't recall any examples of private entities deciding what to do with public means of production
(mafia perhaps).
Sheldon Wolin
introduced
us to inverted totalitarism. While it is no longer the government that decides what must be
done, the private 'owners' just buy the government, the judiciary, the press, or whatever is needed
to achieve their means.
When I cite Germany, it is not so much AfD, but the 2€/hour jobs I am worried about. When I cite
Belgium, it is not the fools of Vlaams Belang, but rather the un-taxing of corporations and the
tear-down of social justice that worries me.
But Jeff, is Wolin accurate in using the term "inverted totalitarianism" to try to capture
the nature of our modern extractive bureaucratic monolith that apparently functions in an environment
where "it is no longer the government that decides what must be done..simply.."private owners
just buy the government, the judiciary, the press, or whatever is needed to achieve their means."
Mirowski argues quite persuasively that the neoliberal ascendency does not represent the retreat
of the State but its remaking to strongly support a particular conception of a market society
that is imposed with the help of the State on our society.
For Mirowski, neoliberalism is definitely not politically libertarian or opposed to strong
state intervention in the economy and society.
Inverted totalitarianism is the mirror image of fascism, which is why so many are confused.
Fascism is just a easier term to use and more understandable by all. There is not a strict adherence
to fascism going on, but it's still totalitarian just the same.
Hi
I live in Europe as well, and what to think of Germany's AfD, Greece's Golden Dawn, the Wilder's
party in the Netherlands etc. Most of them subscribe to the freeloading, sorry free trading economic
policies of neoliberalism.
There's LePen in France and the far-right, fascist leaning party nearly won in Austria. The
far right in Greece as well. There's clearly a move to the far right in Europe. And then there's
the totalitarian mess that is Turkey. How much further this turn to a fascist leaning right goes
and how widespread remains to be seen, but it's clearly underway.
Searched 'current fascist movements europe' and got these active groups from wiki.
National Bolshevik Party-Belarus
Parti Communautaire National-Européen Belgium
Bulgarian National Alliance Bulgaria
Nova Hrvatska Desnica Croatia
Ustaše Croatia
National Socialist Movement of Denmark
La Cagoule France
National Democratic Party of Germany
Fascism and Freedom Movement – Italy
Fiamma Tricolore Italy
Forza Nuova Italy
Fronte Sociale Nazionale Italy
Movimento Fascismo e Libertà Italy
Pērkonkrusts Latvia
Norges Nasjonalsosialistiske Bevegelse Norway
National Radical Camp (ONR) Poland
National Revival of Poland (NOP)
Polish National Community-Polish National Party (PWN-PSN)
Noua Dreaptă Romania
Russian National Socialist Party(formerly Russian National Union)
Barkashov's Guards Russia
National Socialist Society Russia
Nacionalni stroj Serbia
Otačastveni pokret Obraz Serbia
Slovenska Pospolitost Slovakia
España 2000 Spain
Falange Española Spain
Nordic Realm Party Sweden
National Alliance Sweden
Swedish Resistance Movement Sweden
National Youth Sweden
Legion Wasa Sweden
SPAS Ukraine
Blood and Honour UK
British National Front UK
Combat 18 UK
League of St. George UK
National Socialist Movement UK
Nationalist Alliance UK
November 9th Society UK
Racial Volunteer Force UK
"Fascism" has become the prefered term of abuse applied indiscriminately by the right thinking
to any person or movement which they want to tar as inherently objectionable, and which can therefore
be dismissed without the tedium of actually engaging with them at the level of ideas.
Most of the people who like to throw this word around couldn't give you a coherant definition
of what exactly they understand it to signify, beyond "yuck!!"
In fairness even students of political ideology have trouble teasing out a cosistent system
of beliefs, to the point where some doubt fascism is even a coherent ideology. That hardly excuses
the intellectual vacuity of those who use it as a term of abuse, however.
Precisely 3,248 angels can fit on the head of a pin. Parsing the true definition of "fascism"
is a waste of time, broadly, fascism is an alliance of the state, the corporation, and the military,
anyone who doesn't see that today needs to go back to their textbooks.
As far as the definition "neo-liberalism" goes, yes it's a useful label. But let's keep it
simple: every society chooses how resources are allocated between Capital and Labor. The needle
has been pegged over on the Capital side for quite some time, my "start date" is when Reagan busted
the air traffic union. The hideous Republicans managed to sell their base that policies that were
designed to let companies be "competitive" were somehow good for them, not just for the owners
of the means of production.
The only way they have avoided complete revolt has been endless borrowing to fund entitlements,
once that one-time fix plays out the consequences will be apparent. The funding mechanism itself
(The Fed) has even morphed into a neo-liberal tool designed to enrich Capital while enslaving
Labor with the consequences.
"Every society chooses how resources are allocated between capital and labor." More specifically,
isn't it a struggle between various political/economic/cultural movements within a society which
chooses how resources are allocated between capital and labor.
Take, for example, the late 1880s-1890s in the U.S. During that time-frame there were powerful
agrarian populists movements and the beginnings of some labor/socialist movements from below,
while from above the property-production system was modified by a powerful political movement
advocating for more corporate administered markets over the competitive small-firm capitalism
of an earlier age.
It was this movement for corporate administered markets which won the battle and defeated/absorbed
the agrarian populists.
What are the array of such forces in 2016? What type of movement doe Trump represent? Sanders?
Clinton?
fascism is an alliance of the state, the corporation, and the military, anyone who doesn't
see that today needs to go back to their textbooks
Which textbooks specifically?
The article I cited above in Vox canvasses the opinion of five serious students of fascism,
and none of them believe Trump is a fascist. I'd be most interested in knowing what you
have been reading.
As for your definition of "fascism", it's obviously so vague and broad that it really doesn't
explain anything. To the extent it contains any insight it is that public institutions (the state),
private businesses (the corporation) and the armed forces all exert significant influence on public
policy. That and a buck and and a half will get you a cup of coffee. If anything it is merely
a very crude descriptive model of the political process. It doesn't define fascism as a particular
set of beliefs that make it a distinct political ideology that can be differentiated from other
ideologies (again, see the Vox article for a discussion of some of the beliefs that are arguably
characteristic of fascist movements). Indeed by your standard virtually every state that has ever
existed has to a greater or lesser extent been "fascist".
My objection to imprecise language here isn't merely pedantic. The leftist dismissal of
right wing populists like Trump (or increasingly influential European movements like Ukip, AfD,
and the Front national) as "fascist" is a reductionist rhetorical device intended to marginalize
them by implying their politics are so far outside of the mainstream that they do not need to
be taken seriously. Given that these movements are only growing in strength as faith in traditional
political movements and elites evaporate this is likely to produce exactly the opposite result.
Right wing populism isn't going to disappear just because the left keeps trying to wish it away.
Refusing to accept this basic political fact risks condemning the left rather than "the fascists"
to political irrelevance.
I moved to a small city/town in Iowa almost 20 years ago. Then, it still had something of a
Norman Rockwell quality to it, particularly in a sense of egalitarianism, and also some small
factory jobs which still paid something beyond a bare existence.
Since 2000, many of those jobs have left, and the population of the county has declined by
about 10%. Kmart, Penney's, and Sears have left as payday/title loan outfits, pawnshops, smoke
shops, and used car dealers have all proliferated.
Parts of the town now resemble a combination of Appalachia and Detroit. Sanders easily won
the caucuses here and, no, his supporters were hardly the latte sippers of someone's imagination,
but blue collar folks of all ages.
My tale is similar to yours. About 2 years ago, I accepted a transfer from Chicagoland to north
central Wisconsin. JC Penney left a year and a half ago, and Sears is leaving in about 3-4 months.
Kmart is long gone.
I was back at the old homestead over Memorial Day, and it's as if time has stood still. Home
prices still going up; people out for dinner like crazy; new & expensive automobiles everywhere.
But driving out of Chicagoland, and back through rural Wisconsin it is unmistakeable.
2 things that are new: The roads here are deteriorating FAST. In Price County, the road
commissioner said last night that their budget allows for resurfacing all the roads on a 200 year
basis. (Yes, that means there is only enough money to resurface all the county roads if spread
out over 200 years.) 2nd, there are dead deer everywhere on the side of the road. In years past,
they were promptly cleaned up by the highway department. Not any more. Gross, but somebody has
to do the dead animal clean up. (Or not. Don't tell Snotty Walker though.)
Anyway, not everything is gloom and doom. People seem outwardly happy. But if you're paying
attention, signs of stress and deterioration are certainly out there.
This Trump support seems like a form of political vandalism with Trump as the spray paint.
People generally feel frustrated with government, utterly powerless and totally left out as the
ranks of the precariat continue to grow. Trump appeals to the nihilistic tendencies of some people
who, like frustrated teens, have decided to just smashed things up for the hell of it. They think
a presidency mix of Caligula with Earl Scheib would be a funny hoot.
You also have the more gullible fundis who have actually deluded themselves into thinking the
man who is ultimate symbol of hedonism will deliver them from secularism because he says he will.
Authoritarians who seek solutions through strong leaders are usually the easiest to con because
they desperately want to believe in their eminent deliverance by a human deus ex machina. Plus
he is ostentatiously rich in a comfortably tacky way and a TV celebrity beats a Harvard law degree.
And why not the thinking goes the highly vaunted elite college Acela crowd has pretty much made
a pig's breakfast out of things. So much for meritocracy. Professor Harold Hill is going to give
River City a boys band.
Someone at American Conservative, when trying to get at why it's pointless to tell people
Trump will wreck the place, described him as a "hand grenade" lobbed into the heart of government.
You can't scare people with his crass-ness and destructive tendencies, because that's precisely
what his voters are counting on when/if he gets into government.
In other words, the MSM's fear is the clearest sign to these voters that their
political revolution is working. Since TPTB decided peaceful change (i.e. Sanders) was a non-starter,
then they get to reap the whirlwind.
Your phrase "Trump is political vandalism" is great. I don't think I've seen a better description.
NPR this morning was discussing Trump and his relationship with the press and the issues some
GOP leaders have with him. When his followers were discussed, the speakers closely circled your
vandalism point. Basically they said that his voters are angry with the power brokers and leaders
in DC and regardless of whether they think Trump's statements are heartfelt or just rhetoric,
they DO know he will stick it to those power brokers so that's good. Vandalism by a longer phrase.
Meritocracy was ALWAYS a delusional fraud. What you invariably get, after a couple of generations,
is a clique of elitists who define merit as themselves and reproduce it ad nauseam. Who still
believes in such laughable kiddie stories?
Besides, consumers need to learn to play the long game and suck up the "scurrilous attacks"
on their personal consumption habits for the next four years. The end of abortion for four years
is not important - lern2hand and lern2agency, and lern2cutyourrapist if it comes to that. What
is important is that the Democratic Party's bourgeois yuppie constituents are forced to defend
against GOP attacks on their personal and cultural interests with wherewithal that would have
been ordinarily spent to attend to their sister act with their captive constituencies.
If bourgeois Democrats hadn't herded us into a situation where individuals mean nothing outside
of their assigned identity groups and their corporate coalition duopoly, they wouldn't be reaping
the whirlwind today. Why, exactly, should I be sympathetic to exploitative parasites such as the
middle class?
There are all good ideas. However, population growth undermines almost all of them. Population
growth in America is immigrant based. Reverse immigration influxes and you are at least doing
something to reduce population growth.
How to "reverse immigration influxes"?
Stop accepting refugees. It's outrageous that refugees from for example, Somalia,
get small business loans, housing assistance, food stamps and lifetime SSI benefits while some
of our veterans are living on the street.
No more immigration amnesties of any kind.
Deport all illegal alien criminals.
Practice "immigrant family unification" in the country of origin. Even if you have
to pay them to leave. It's less expensive in the end.
Eliminate tax subsidies to American corn growers who then undercut Mexican farmers'
incomes through NAFTA, driving them into poverty and immigration north. Throw Hillary Clinton
out on her ass and practice political and economic justice to Central America.
I too am a lifetime registered Democrat and I will vote for Trump if Clinton gets the crown.
If the Democrats want my vote, my continuing party registration and my until recently sizeable
donations in local, state and national races, they will nominate Bernie. If not, then I'm an Independent
forevermore. They will just become the Demowhig Party.
Campaign Finance Reform: If you can't walk into a voting booth you cannot contribute,
or make all elections financed solely by government funds and make private contributions of
any kind to any politician illegal.
Re-institute Glass-Steagall but even more so. Limit the number of states a bank can
operate in. Make the Fed publicly owned, not privately owned by banks.
Completely revise corporate law, doing away with the legal person hood of corporations
and limit of liability for corporate officers and shareholders.
Single payer health care for everyone. Allow private health plans but do away with
health insurance as a deductible for business. Remove the AMA's hold on licensing of medical
schools which restricts the number of doctors.
Do away with the cap on Social Security wages and make all income, wages, capital gains,
interest, and dividends subject to taxation.
Impose tariffs to compensate for lower labor costs overseas and revise industry.
Cut the Defense budget by 50% and use that money for intensive infrastructure development.
Raise the national minimum wage to $15 and hour.
Severely curtail the revolving door from government to private industry with a 10 year
restriction on working for an industry you dealt with in any way as a government official.
Free public education including college (4 year degree).
Obama and Holder, allowing the banks to be above the law have them demi-gods, many of whom
are psychopaths and kleptocrats, and with their newly granted status, they are now re-shaping
the world in their own image. Prosecute these demi-gods and restore sanity. Don't and their greed
for our things will never end until nothings left.
This is why Hillary is so much more dangerous than trump, because she and the demi gods
are all on the same page. The TPP is their holy grail so I expect heaven and earth to be moved,
especially if it looks like some trade traitors are going to get knocked off in the election,
scoundrels like patty murray (dino, WA) will push to get it through then line up at the feed trough
to gorge on k street dough. I plan to vote stein if it's not Bernie, but am reserving commitment
until I see what kind of betrayals the dems have for me, if it's bad enough I'll go with the trump
hand grenade.
Totally agree tegnost, no more democratic neoliberals -- Patty Murray (up for re-election)
and Cantwell are both trade traitors and got fast track passed.
Two things are driving our troubles: over-population and globalization. The plutocrats
and kleptocrats have all the leverage over the rest of us laborers when the population of human
beings has increased seven-fold in the last 70 years, from a little over a billion to seven billions
(and growing) today. They are happy to let us freeze to death behind gas stations in order for
them to compete with other oligarchs in excess consumption.
This deserves a longer and more thoughtful comment, but I don't have the time this morning.
I have to fight commute traffic, because the population of my home state of California has doubled
from 19M in 1970 to an estimated 43M today (if you count the Latin American refugees and H1B's).
Thank you for mentioning the third rail of overpopulation. Too often, this giant category
of problems is ignored, because it makes people uncomfortable. The planet is finite, resources
on the planet are finite, yet the number of people keeps growing. We need to strive for a higher
quality of life, not a higher quantity of people.
The issue goes beyond "current neoliberals up for election", it is most of our political
establishment that has been corrupted by a system that provides for the best politicians money
can buy.
In the 1980's I worked inside the beltway witnessing the new cadre of apparatchiks that drove
into town on the Reagan coattails full of moral a righteousness that became deviant, parochial,
absolutist and for whom bi-partisan approaches to policy were scorned prodded on by new power
brokers promoting their gospels in early morning downtown power breakfasts. Sadly our politicians
no longer serve but seek a career path in our growing meritocratic plutocracy.
America has always been a country where a majority of the population has been poor. With
the exception of a fifty five year(1950-2005) year period where access to large quantities of
consumer debt by households was deployed to first to provide a wealth illusion to keep socialism
at bay, followed by a mortgage debt boom to both keep the system afloat and strip the accumulated
capital of the working class, i.e. home equity, the history of the US has been one of poverty
for the masses.
Further debt was foisted on the working class in the form of military Keynesianism, generating
massive fiscal deficits which are to be paid for via austerity in a neo-feudal economy.
"... Money, it seems to him, has somehow changed its role. It has "increased" (is that possible, he asks?) while at the same time it has become concentrated in fewer and fewer hands. It appears to seek to become an autonomous and dominating sector of economic life, functionally separated from production of real things, almost all of which seem to come from faraway places. "Real" actually begins to change its meaning, another topic more interesting still. This devotion to the world of money-making-money seems to have obsessed the lives of many of the most "important" Americans. Entire TV networks are devoted to it. They talk about esoteric financial instruments that to the ordinary citizen look more like exotically placed bets-on-credit in the casino than genuine ways to grow real-world business, jobs, wages, and family income. The few who are in position to master the game live material lives that were beyond what almost any formerly "wealthy" man or woman in Rip's prior life could even imagine ..."
"... children gone away and lost to either the relentless rootlessness of the trans-national economy or the virtual hell-world of meth and opioids and heroin and unending underemployed hopelessness. ..."
"... "If public life can suffer a metaphysical blow, the death of the labor question was that blow. For millions of working people, it amputated the will to resist." ..."
"... It's a Wonderful Life ..."
"... as educators ..."
"... OK, so I hear some of you saying, corporate America will never let this Civic Media get off the ground. My short answer to this is that corporations do what makes money for them, and in today's despairing political climate there's money to be made in sponsoring something truly positive, patriotic and constructive. ..."
"... I am paying an exorbitant subscription for the UK Financial Times at the moment. Anyway, the good news is that very regular articles are appearing where you can almost feel the panic at the populist uprisings. ..."
"... The kernel of Neoliberal Ideology: "There is no such a thing as society." (Margaret Thatcher). ..."
"... "In this postindustrial world not only is the labor question no longer asked, not only is proletarian revolution passé, but the proletariat itself seems passé. And the invisibles who nonetheless do indeed live there have internalized their nonexistence, grown demoralized, resentful, and hopeless; if they are noticed at all, it is as objects of public disdain. What were once called "blue-collar aristocrats"-skilled workers in the construction trades, for example-have long felt the contempt of the whole white-collar world. ..."
"... Or, we could replace Western liberal culture, with its tradition to consume and expand by force an unbroken chain from the Garden of Eden to Friedrich von Hayek, with the notion of maintenance and "enough". Bourgeois make-work holds no interest to me. ..."
"... My understanding of the data is that living standards increased around the world during the so-called golden age, not just in the U.S. (and Western Europe and Japan and Australia ). It could be that it was still imperialism at work, but the link between imperialism and the creation of the middle class is not straightforward. ..."
"... I thought neoliberalism was just the pogrom to make everyone – rational agents – as subscribed by our genetic / heraldic betters .. putting this orbs humans and resources in the correct "natural" order . ..."
"... Disheveled Marsupial for those thinking neoliberalism is not associated with libertarianism one only has to observe the decades of think tanks and their mouth organs roaming the planet . especially in the late 80s and 90s . bringing the might and wonders of the – market – to the great unwashed globally here libertarian priests rang in the good news to the great unwashed ..."
"... I would argue that neoliberalism is a program to define markets as primarily engaged in information processing and to make everyone into non-agents ( as not important at all to the proper functioning of markets). ..."
"... It also appears that neoliberals want to restrict democracy to the greatest extent possible and to view markets as the only foundation for truth without any need for input from the average individual. ..."
I am almost 70 years old, born and raised in New York City, still living in a near suburb.
Somehow, somewhere along the road to my 70th year I feel as if I have been gradually transported
to an almost entirely different country than the land of my younger years. I live painfully now
in an alien land, a place whose habits and sensibilities I sometimes hardly recognize, while unable
to escape from memories of a place that no longer exists. There are days I feel as I imagine a
Russian pensioner must feel, lost in an unrecognizable alien land of unimagined wealth, power,
privilege, and hyper-glitz in the middle of a country slipping further and further into hopelessness,
alienation, and despair.
I am not particularly nostalgic. Nor am I confusing recollection with sentimental yearnings
for a youth that is no more. But if I were a contemporary Rip Van Winkle, having just awakened
after, say, 30-40 years, I would not recognize my beloved New York City. It would be not just
the disappearance of the old buildings, Penn Station, of course, Madison Square Garden and its
incandescent bulb marquee on 50th and 8th announcing NYU vs. St. John's, and the WTC, although
I always thought of the latter as "new" until it went down. Nor would it be the disappearance
of all the factories, foundries, and manufacturing plants, the iconic Domino Sugar on the East
River, the Wonder Bread factory with its huge neon sign, the Swingline Staples building in Long
Island City that marked passage to and from the East River tunnel on the railroad, and my beloved
Schaeffer Beer plant in Williamsburg, that along with Rheingold, Knickerbocker, and a score of
others, made beer from New York taste a little bit different.
It wouldn't be the ubiquitous new buildings either, the Third Avenue ghostly glass erected
in the 70's and 80's replacing what once was the most concentrated collection of Irish gin mills
anywhere. Or the fortress-like castles built more recently, with elaborate high-ceilinged lobbies
decorated like a kind of gross, filthy-wealthy Versailles, an aesthetically repulsive style that
shrieks "power" in a way the neo-classical edifices of our Roman-loving founders never did. Nor
would it even be the 100-story residential sticks, those narrow ground-to-clouds skyscraper condominiums
proclaiming the triumph of globalized capitalism with prices as high as their penthouses, driven
ever upward by the foreign billionaires and their obsession with burying their wealth in Manhattan
real estate.
It is not just the presence of new buildings and the absence of the old ones that have this
contemporary Van Winkle feeling dyslexic and light-headed. The old neighborhoods have disintegrated
along with the factories, replaced by income segregated swatches of homogenous "real estate" that
have consumed space, air, and sunlight while sucking the distinctiveness out of the City. What
once was the multi-generational home turf for Jewish, Afro-American, Puerto Rican, Italian, Polak
and Bohunk families is now treated as simply another kind of investment, stocks and bonds in steel
and concrete. Mom's Sunday dinners, clothes lines hanging with newly bleached sheets after Monday
morning wash, stickball games played among parked cars, and evenings of sitting on the stoop with
friends and a transistor radio listening to Mel Allen call Mantle's home runs or Alan Freed and
Murray the K on WINS 1010 playing Elvis, Buddy Holly, and The Drifters, all gone like last night's
dreams.
Do you desire to see the new New York? Look no further than gentrifying Harlem for an almost
perfect microcosm of the city's metamorphosis, full of multi-million condos, luxury apartment
renovations, and Maclaren strollers pushed by white yuppie wife stay-at-homes in Marcus Garvey
Park. Or consider the "new" Lower East Side, once the refuge of those with little material means,
artists, musicians, bums, drug addicts, losers and the physically and spiritually broken - my
kind of people. Now its tenements are "retrofitted" and remodeled into $4000 a month apartments
and the new residents are Sunday brunching where we used to score some Mary Jane.
There is the "Brooklyn brand", synonymous with "hip", and old Brooklyn neighborhoods like Red
Hook and South Brooklyn (now absorbed into so desirable Park Slope), and Bushwick, another former
outpost of the poor and the last place I ever imagined would be gentrified, full of artists and
hipsters driving up the price of everything. Even large sections of my own Queens and the Bronx
are affected (infected?). Check out Astoria, for example, neighborhood of my father's family,
with more of the old ways than most but with rents beginning to skyrocket and starting to drive
out the remaining working class to who knows where.
Gone is almost every mom and pop store, candy stores with their egg creams and bubble gum cards
and the Woolworth's and McCrory's with their wooden floors and aisles containing ordinary blue
collar urgencies like thread and yarn, ironing boards and liquid bleach, stainless steel utensils
of every size and shape. Where are the locally owned toy and hobby stores like Jason's in Woodhaven
under the el, with Santa's surprises available for lay-away beginning in October? No more luncheonettes,
cheap eats like Nedicks with hot dogs and paper cones of orange drink, real Kosher delis with
vats of warm pastrami and corned beef cut by hand, and the sacred neighborhood "bar and grill",
that alas has been replaced by what the kids who don't know better call "dive bars", the detestable
simulacra of the real thing, slick rooms of long slick polished mahogany, a half-dozen wide screen
TV's blaring mindless sports contests from all over the world, over-priced micro-brews, and not
a single old rummy in sight?
Old Rip searches for these and many more remembered haunts, what Ray Oldenburg called the "great
good places" of his sleepy past, only to find store windows full of branded, high-priced, got-to-have
luxury-necessities (necessary if he/she is to be certified cool, hip, and successful), ridiculously
overpriced "food emporia", high and higher-end restaurants, and apparel boutiques featuring hardened
smiles and obsequious service reserved for those recognized by celebrity or status.
Rip notices too that the visible demographic has shifted, and walking the streets of Manhattan
and large parts of Brooklyn, he feels like what walking in Boston Back Bay always felt like, a
journey among an undifferentiated mass of privilege, preppy or 'metro-sexed' 20 and 30-somethings
jogging or riding bicycles like lean, buff gods and goddesses on expense accounts supplemented
by investments enriched by yearly holiday bonuses worth more than Rip earned in a lifetime.
Sitting alone on a park bench by the river, Rip reflects that more than all of these individual
things, however, he despairs of a city that seems to have been reimagined as a disneyfied playground
of the privileged, offering endless ways to self-gratify and philistinize in a clean, safe (safest
big city in U.S., he heard someone say), slick, smiley, center-of-the-world urban paradise, protected
by the new centurions (is it just his paranoia or do battle-ready police seem to be everywhere?).
Old ethnic neighborhoods are filled with apartment buildings that seem more like post-college
"dorms", tiny studios and junior twos packed with three or four "singles" roommates pooling their
entry level resources in order to pay for the right to live in "The City". Meanwhile the newer
immigrants find what place they can in Kingsbridge, Corona, Jamaica, and Cambria Heights, far
from the city center, even there paying far too much to the landlord for what they receive.
New York has become an unrecognizable place to Rip, who can't understand why the accent-less
youngsters keep asking him to repeat something in order to hear his quaint "Brooklyn" accent,
something like the King's English still spoken on remote Smith Island in the Chesapeake, he guesses
.
Rip suspects that this "great transformation" (apologies to Polanyi) has coincided, and is somehow
causally related, to the transformation of New York from a real living city into, as the former
Mayor proclaimed, the "World Capital" of financialized commerce and all that goes with it.
"Financialization", he thinks, is not the expression of an old man's disapproval but a way
of naming a transformed economic and social world. Rip is not an economist. He reads voraciously
but, as an erstwhile philosopher trained to think about the meaning of things, he often can't
get his head around the mathematical model-making explanations of the economists that seem to
dominate the more erudite political and social analyses these days. He has learned, however, that
the phenomenon of "capitalism" has changed along with his city and his life.
Money, it seems to him, has somehow changed its role. It has "increased" (is that possible,
he asks?) while at the same time it has become concentrated in fewer and fewer hands. It appears
to seek to become an autonomous and dominating sector of economic life, functionally separated
from production of real things, almost all of which seem to come from faraway places. "Real" actually
begins to change its meaning, another topic more interesting still. This devotion to the world
of money-making-money seems to have obsessed the lives of many of the most "important" Americans.
Entire TV networks are devoted to it. They talk about esoteric financial instruments that to the
ordinary citizen look more like exotically placed bets-on-credit in the casino than genuine ways
to grow real-world business, jobs, wages, and family income. The few who are in position to master
the game live material lives that were beyond what almost any formerly "wealthy" man or woman
in Rip's prior life could even imagine
.
Above all else is the astronomical rise in wealth and income inequality. Rip recalls that growing
up in the 1950's, the kids on his block included, along with firemen, cops, and insurance men
dads (these were virtually all one-parent income households), someone had a dad who worked as
a stock broker. Yea, living on the same block was a "Wall Streeter". Amazingly democratic, no?
Imagine, people of today, a finance guy drinking at the same corner bar with the sanitation guy.
Rip recalls that Aristotle had some wise and cautionary words in his Politics concerning the stability
of oligarchic regimes.
Last year I drove across America on blue highways mostly. I stayed in small towns and cities,
Zanesville, St. Charles, Wichita, Pratt, Dalhart, Clayton, El Paso, Abilene, Clarksdale, and many
more. I dined for the most part in local taverns, sitting at the bar so as to talk with the local
bartender and patrons who are almost always friendly and talkative in these spaces. Always and
everywhere I heard similar stories as my story of my home town. Not so much the specifics (there
are no "disneyfied" Lubbocks or Galaxes out there, although Oxford, MS comes close) but in the
sadness of men and women roughly my age as they recounted a place and time – a way of life – taken
out from under them, so that now their years are filled with decayed and dead downtowns, children
gone away and lost to either the relentless rootlessness of the trans-national economy or the
virtual hell-world of meth and opioids and heroin and unending underemployed hopelessness.
I am not a trained economist. My graduate degrees were in philosophy. My old friends call me
an "Eric Hoffer", who back in the day was known as the "longshoreman philosopher". I have been
trying for a long time now to understand the silent revolution that has been pulled off right
under my nose, the replacement of a world that certainly had its flaws (how could I forget the
civil rights struggle and the crime of Viet Nam; I was a part of these things) but was, let us
say, different. Among you or your informed readers, is there anyone who can suggest a book or
books or author(s) who can help me understand how all of this came about, with no public debate,
no argument, no protest, no nothing? I would be very much appreciative.
I'll just highlight this line for emphasis
"there are no "disneyfied" Lubbocks or Galaxes out there, although Oxford, MS comes close) but
in the sadness of men and women roughly my age as they recounted a place and time – a way of life
– taken out from under them, so that now their years are filled with decayed and dead downtowns,
children gone away and lost to either the relentless rootlessness of the trans-national economy
or the virtual hell-world of meth and opioids and heroin and unending underemployed hopelessness."
my best friend pretty much weeps every day.
I don't have a book to recommend. I do think you identify a really underemphasized central
fact of recent times: the joint processes by which real places have been converted into "real
estate" and real, messy lives replaced by safe, manufactured "experiences." This affects wealthy
and poor neighborhoods alike, in different ways but in neither case for the better.
I live in a very desirable neighborhood in one of those places that makes a lot of "Best of"
lists. I met a new neighbor last night who told me how he and his wife had plotted for years to
get out of the Chicago burbs, not only to our city but to this specific neighborhood, which they
had decided is "the one." (This sentiment is not atypical.) Unsurprisingly, property values in
the neighborhood have gone through the roof. Which, as far as I can tell, most everyone here sees
as an unmitigated good thing.
At the same time, several families I got to know because they moved into the neighborhood about
the same time we did 15-20 years ago, are cashing out and moving away, kids off to or out of college,
parents ready (and financed) to get on to the next phase and the next place. Of course, even though
our children are all Lake Woebegoners, there are no next generations staying in the neighborhood,
except of course the ones still living, or back, at "home." (Those families won't be going anywhere
for awhile!)
I can't argue that new money in the hood hasn't improved some things. Our formerly struggling
food co-op just finished a major expansion and upgrade. Good coffee is 5 minutes closer than it
used to be. But to my wife and me, the overwhelming feeling is that we are now outsiders here
in this neighborhood where we know all the houses and the old trees but not what motivates our
new neighbors. So I made up a word for it: unsettling (adj., verb, noun).
"If public life can suffer a metaphysical blow, the death of the labor question was that
blow. For millions of working people, it amputated the will to resist."
Christopher Lash in "Revolt of the Elites and the Betrayal of Democracy" mentions Ray Oldenburg's
"The Great Good Places: Cafes, Coffee Shops, Community Centers, Beauty Parlors, General Stores,
Bars, Hangouts and How they Got You through the Day."
He argued that the decline of democracy is directly related to the disappearance of what he
called third places:,
"As neighborhood hangouts give way to suburban shopping malls, or, on the other hand private
cocktail parties, the essentially political art of conversation is replaced by shoptalk or personal
gossip.
Increasingly, conversation literally has no place in American society. In its absence how–or
better, where–can political habits be acquired and polished?
Lasch finished he essay by noting that Oldenburg's book helps to identify what is missing from
our then newly emerging world (which you have concisely updated):
"urban amenities, conviviality, conversation, politics–almost everything in part that makes
life worth living."
The best explainer of our modern situation that I have read is Wendell Berry. I suggest that
you start with "The Unsettling of America," quoted below.
"Let me outline briefly as I can what seem to me the characteristics of these opposite kinds
of mind. I conceive a strip-miner to be a model exploiter, and as a model nurturer I take the
old-fashioned idea or ideal of a farmer. The exploiter is a specialist, an expert; the nurturer
is not. The standard of the exploiter is efficiency; the standard of the nurturer is care. The
exploiter's goal is money, profit; the nurturer's goal is health - his land's health, his own,
his family's, his community's, his country's. Whereas the exploiter asks of a piece of land only
how much and how quickly it can be made to produce, the nurturer asks a question that is much
more complex and difficult: What is its carrying capacity? (That is: How much can be taken from
it without diminishing it? What can it produce dependably for an indefinite time?) The exploiter
wishes to earn as much as possible by as little work as possible; the nurturer expects, certainly,
to have a decent living from his work, but his characteristic wish is to work as well as possible.
The competence of the exploiter is in organization; that of the nurturer is in order - a human
order, that is, that accommodates itself both to other order and to mystery. The exploiter typically
serves an institution or organization; the nurturer serves land, household, community, place.
The exploiter thinks in terms of numbers, quantities, "hard facts"; the nurturer in terms of character,
condition, quality, kind."
I also think Prof. Patrick Deneen works to explain the roots (and progression) of decline.
I'll quote him at length here describing the modern college student.
"[T]he one overarching lesson that students receive is the true end of education: the only
essential knowledge is that know ourselves to be radically autonomous selves within a comprehensive
global system with a common commitment to mutual indifference. Our commitment to mutual indifference
is what binds us together as a global people. Any remnant of a common culture would interfere
with this prime directive: a common culture would imply that we share something thicker, an inheritance
that we did not create, and a set of commitments that imply limits and particular devotions.
Ancient philosophy and practice praised as an excellent form of government a res publica –
a devotion to public things, things we share together. We have instead created the world's first
Res Idiotica – from the Greek word idiotes, meaning "private individual." Our education system
produces solipsistic, self-contained selves whose only public commitment is an absence of commitment
to a public, a common culture, a shared history. They are perfectly hollowed vessels, receptive
and obedient, without any real obligations or devotions.
They won't fight against anyone, because that's not seemly, but they won't fight for anyone
or anything either. They are living in a perpetual Truman Show, a world constructed yesterday
that is nothing more than a set for their solipsism, without any history or trajectory."
Wow. Did this hit a nerve. You have eloquently described what was the city of hope for several
generations of outsiders, for young gay men and women, and for real artists, not just from other
places in America, but from all over the world. In New York, once upon a time, bumping up against
the more than 50% of the population who were immigrants from other countries, you could learn
a thing or two about the world. You could, for a while, make a living there at a job that was
all about helping other people. You could find other folks, lots of them, who were honest, well-meaning,
curious about the world. Then something changed. As you said, you started to see it in those hideous
80's buildings. But New York always seemed somehow as close or closer to Europe than to the U.S.,
and thus out of the reach of mediocrity and dumbing down. New York would mold you into somebody
tough and smart, if you weren't already – if it didn't, you wouldn't make it there.
Now, it seems, this dream is dreamt. Poseurs are not artists, and the greedy and smug drive
out creativity, kindness, real humor, hope.
It ain't fair. I don't know where in this world an aspiring creative person should go now,
but it probably is not there.
Americans cannot begin to reasonably demand a living wage, benefits and job security when there
is an unending human ant-line of illegals and legal immigrants willing to under bid them.
Only when there is a parity or shortage of workers can wage demands succeed, along with other
factors.
From 1925 to 1965 this country accepted hardly any immigrants, legal or illegal. We had the
bracero program where Mexican males were brought in to pick crops and were then sent home to collect
paychecks in Mexico. American blacks were hired from the deep south to work defense plants in
the north and west.
Is it any coincidence that the 1965 Great Society program, initiated by Ted Kennedy to primarily
benefit the Irish immigrants, then co-opted by LBJ to include practically everyone, started this
process of Middle Class destruction?
1973 was the peak year of American Society as measured by energy use per capita, expansion
of jobs and unionization and other factors, such as an environment not yet destroyed, nicely measured
by the The Real Progress Indicator.
Solution? Stop importing uneducated people. That's real "immigration reform".
Now explain to me why voters shouldn't favor Trump's radical immigration stands?
Maybe, but OTOH, who is it, exactly, who is recruiting, importing, hiring and training undocumented
workers to downgrade pay scales??
Do some homework, please. If businesses didn't actively go to Central and South America to
recruit, pay to bring here, hire and employ undocumented workers, then the things you discuss
would be great.
When ICE comes a-knocking at some meat processing plant or mega-chicken farm, what happens?
The undocumented workers get shipped back to wherever, but the big business owner doesn't even
get a tap on the wrist. The undocumented worker – hired to work in unregulated unsafe unhealthy
conditions – often goes without their last paycheck.
It's the business owners who manage and support this system of undocumented workers because
it's CHEAP, and they don't get busted for it.
Come back when the USA actually enforces the laws that are on the books today and goes after
big and small business owners who knowingly recruit, import, hire, train and employee undocumented
workers you know, like Donald Trump has all across his career.
This is the mechanism by which the gov't has assisted biz in destroying the worker, competition
for thee, but none for me. For instance I can't go work in canada or mexico, they don't allow
it. Policy made it, policy can change it, go bernie. While I favor immigration, in it's current
form it is primarily conducted on these lines of destroying workers (H1b etc and illegals combined)
Lucky for the mexicans they can see the american dream is bs and can go home. I wonder who the
latinos that have gained citizenship will vote for. Unlikely it'll be trump, but they can be pretty
conservative, and the people they work for are pretty conservative so no guarantee there, hillary
is in san diego at the tony balboa park where her supporters will feel comfortable, not a huge
venue I think they must be hoping for a crowd, and if she can't get one in san diego while giving
a "if we don't rule the world someone else will" speech, she can't get one anywhere. Defense contractors
and military advisors and globalist biotech (who needs free money more than biotech? they are
desperate for hillary) are thick in san diego.
I live part-time in San Diego. It is very conservative. The military, who are constantly screwed
by the GOP, always vote Republican. They make up a big cohort of San Diego county.
Hillary may not get a big crowd at the speech, but that, in itself, doesn't mean that much
to me. There is a segment of San Diego that is somewhat more progressive-ish, but it's a pretty
conservative county with parts of eastern SD county having had active John Birch Society members
until recently or maybe even ongoing.
There's a big push in the Latino community to GOTV, and it's mostly not for Trump. It's possible
this cohort, esp the younger Latino/as, will vote for Sanders in the primary, but if Clinton gets
the nomination, they'll likely vote for her (v. Trump).
I was unlucky enough to be stuck for an hour in a commuter train last Friday after Trump's
rally there. Hate to sound rude, but Trump's fans were everything we've seen. Loud, rude, discourteous
and an incessant litany of rightwing talking points (same old, same old). All pretty ignorant.
Saying how Trump will "make us great again." I don't bother asking how. A lot of ugly comments
about Obama and how Obama has been "so racially divisive and polarizing." Well, No. No, Obama
has not been or done that, but the rightwing noise machine has sure ginned up your hatreds, angers
and fears. It was most unpleasant. The only instructive thing about it was confirming my worst
fears about this group. Sorry to say but pretty loutish and very uninformed. Sigh.
part timer in sd as well, family for hillary except for nephew and niece .I keep telling my
mom she should vote bernie for their sake but it never goes over very well
Re Methland, we live in rural US and we got a not-very-well hidden population of homeless children.
I don't mean homeless families with children, I mean homeless children. Sleeping in parks in good
weather, couch-surfing with friends, etc. I think related.
Fascism is a system of political and social order intended to reinforce the unity, energy and
purity of communities in which liberal democracy stand(s) accused of producing division and decline.
. . . George Orwell reminded us, clad in the mainstream patriotic dress of their own place and
time, . . . an authentically popular fascism in the United States would be pious and anti-Black;
in Western Europe, secular and antisemitic, or more probably, these days anti-Islamic; in Russia
and Eastern Europe, religious, antisemitic, and slavophile.
Robert O. Paxton
In The Five Stages of Faschism
" that eternal enemy: the conservative manipulators of privilege who damn as 'dangerous agitators'
any man who menaces their fortunes" (maybe 'power and celebrity' should be added to fortunes)
Sinclair Lewis
It Can't Happen Here page 141
On the Boots To Ribs Front: Anyone hereabouts notice that Captain America has just been revealed
to be a Nazi? Maybe this is what R. Cohen was alluding to but I doubt it.
The four horse men are, political , social, economic and environmental collapse . Any one remember
the original Mad Max movie. A book I recommend is the Crash Of 2016 By Thom Hartmann.
From the comment, I agree with the problems, not the cause. We've increased the size and scope
of the safety net over the last decade. We've increased government spending versus GDP. I'm not
blaming government but its not neoliberal/capitalist policy either.
1. Globalization clearly helps the poor in other countries at the expense of workers in the
U.S. But at the same time it brings down the cost of goods domestically. So jobs are not great
but Walmart/Amazon can sell cheap needs.
2. Inequality started rising the day after Bretton Woods – the rich got richer everyday after
"Nixon Shock"
Hi rfam : To point 1 : Why is there a need to bring down the cost of goods? Is it because of
past outsourcing and trade agreements and FR policies? I think there's a chicken and egg thing
going on, ie.. which came first. Globalization is a way to bring down wages while supplying Americans
with less and less quality goods supplied at the hand of global corporations like Walmart that
need welfare in the form of food stamps and the ACA for their workers for them to stay viable
(?). Viable in this case means ridiculously wealthy CEO's and the conglomerate growing bigger
constantly. Now they have to get rid of COOL's because the WTO says it violates trade agreements
so we can't trace where our food comes from in case of an epidemic. It's all downhill. Wages should
have risen with costs so we could afford high quality American goods, but haven't for a long,
long time.
Globalization helps the rich here way more than the poor there. The elites get more money for
nothing (see QE before you respond, if you do, that's where the money for globalization came from)
the workers get the husk. Also the elite gets to say "you made your choices" and other moralistic
crap. The funny(?) thing is they generally claim to be atheists, which I translate into "I am
God, there doesn't need to be any other" Amazon sells cheap stuff by cheating on taxes, and barely
makes money, mostly just driving people out of business. WalMart has cheap stuff because they
subsidise their workers with food stamps and medicaid. Bringing up bretton woods means you don't
know much about money creation, so google "randy wray/bananas/naked capitalism" and you'll find
a quick primer.
The Walmart loathsome spawn and Jeff Bezos are the biggest welfare drains in our nation – or
among the biggest. They woefully underpay their workers, all while training them on how to apply
for various welfare benefits. Just so that their slaves, uh, workers can manage to eat enough
to enable them to work.
It slays me when US citizens – and it happens across the voting spectrum these days; I hear
just as often from Democratic voters as I do from GOP voters – bitch, vetch, whine & cry about
welfare abuse. And if I start to point out the insane ABUSE of welfare by the Waltons and Jeff
Bezos, I'm immediately greeted with random TRUE stories about someone who knew someone who somehow
made out like a bandit on welfare.
Hey, I'm totally sure and in agreement that there are likely a small percentage of real welfare
cheats who manage to do well enough somehow. But seriously? That's like a drop in the bucket.
Get the eff over it!!!
Those cheats are not worth discussing. It's the big fraud cheats like Bezos & the Waltons and
their ilk, who don't need to underpay their workers, but they DO because the CAN and they get
away with it because those of us the rapidly dwindling middle/working classes are footing the
bill for it.
Citizens who INSIST on focusing on a teeny tiny minority of real welfare cheats, whilst studiously
ignoring the Waltons and the Bezos' of the corporate world, are enabling this behavior. It's one
of my bugabears bc it's so damn frustrating when citizens refuse to see how they are really being
ripped off by the 1%. Get a clue.
That doesn't even touch on all the other tax breaks, tax loopholes, tax incentives and just
general all-around tax cheating and off-shore money hiding that the Waltons and Bezos get/do.
Sheesh.
"I'm immediately greeted with random TRUE stories about someone who knew someone who somehow
made out like a bandit on welfare."
is the key and a v. long term result of the application of Bernays' to political life. Its
local and hits at the gut interpersonal level 'cos the "someones" form a kind of chain of trust
esp. if the the first one on the list is a friend or a credentialed media pundit. Utterly spurious
I know but countering this with a *merely* rational analysis of how Walmart, Amazon abuse the
welfare system to gouge profits from the rest of us just won't ever, for the large majority, get
through this kind emotional wall.
I don't know what any kind of solution might look like but, somehow, we need to find a way
of seriously demonising the corporate parasites that resonates at the same emotional level as
the "welfare cheat" meme that Bill Clinton and the rest of the DLC sanctified back in the '90s.
Something like "Walmart's stealing your taxes" might work but how to get it out there in a
viral way ??
What a comment from seanseamour. And the "hoisting" of it to high visibility at the site is
a testament to the worth of Naked Capitalism.
seanseamour asks "What does that have to do with education?" and answers "Everything if one
considers the elitist trend " This question & answer all but brings tears to my eyes. It is so
utterly on point. My own experience of it, if I may say so, comes from inside the belly of the
beast. As a child and a product of America's elite universities (I have degrees from Harvard and
Yale, and my dad, Richard B. Sewall, was a beloved English prof at Yale for 42 years), I could
spend all morning detailing the shameful roles played by America's torchbearing universities –
Harvard, Yale, Stanford etc – in utterly abandoning their historic responsibility as educators
to maintaining the health of the nation's public school system.*
And as I suspect seanseymour would agree, when a nation loses public education, it loses everything.
But I don't want to spend all morning doing that because I'm convinced that it's not too late
for America to rescue itself from maelstrom in which it finds itself today. (Poe's "Maelstrom"
story, cherished by Marshall McLuhan, is supremely relevant today.)
To turn America around, I don't look to education – that system is too far gone to save itself,
let alone the rest of the country – but rather to the nation's media: to the all-powerful public
communication system that certainly has the interactive technical capabilities to put citizens
and governments in touch with each other on the government decisions that shape the futures of
communities large and small.
For this to happen, however, people like the us – readers of Naked Capitalism – need to stop
moaning and groaning about the damage done by the neoliberals and start building an issue-centered,
citizen-participatory, non-partisan, prime-time Civic Media strong enough to give all Americans
an informed voice in the government decisions that affect their lives. This Civic media would
exist to make citizens and governments responsive and accountable to each other in shaping futures
of all three communities – local, state and national – of which every one of us is a member.
Pie in the sky? Not when you think hard about it. A huge majority of Americans would welcome
this Civic Media. Many yearn for it. This means that a market exists for it: a Market of the Whole
of all members of any community, local, state and national. This audience is large enough to rival
those generated by media coverage of pro sports teams, and believe it or not much of the growth
of this Civic media could be productively modeled on the growth of media coverage of pro sports
teams. This Civic Media would attract the interest of major advertisers, especially those who
see value in non-partisan programming dedicated to getting America moving forward again. Dynamic,
issue-centered, problem-solving public forums, some modeled on voter-driven reality TV contests
like The Voice or Dancing with the Stars, could be underwritten by a "rainbow" spectrum of funders,
commericial, public, personal and even government sources.
So people take hope! Be positive! Love is all we need, etc. The need for for a saving alternative
to the money-driven personality contests into which our politics has descended this election year
is literally staring us all in the face from our TV, cellphone and computer screens. This is no
time to sit back and complain, it's a time to start working to build a new way of connecting ourselves
so we can reverse America's rapid decline.
OK, so I hear some of you saying, corporate America will never let this Civic Media get
off the ground. My short answer to this is that corporations do what makes money for them, and
in today's despairing political climate there's money to be made in sponsoring something truly
positive, patriotic and constructive. And I hear a few others saying that Americans are too
dumbed down, too busy, too polarized or too just plain stupid to make intelligent, constructive
use of a non-partisan, problem-solving Civic Media. But I would not underestimate the intelligence
of Americans when they can give their considered input – by vote, by comment or by active participation
– in public forums that are as exciting and well managed as an NFL game or a Word Series final.
I am paying an exorbitant subscription for the UK Financial Times at the moment. Anyway,
the good news is that very regular articles are appearing where you can almost feel the panic
at the populist uprisings.
Whatever system is put in place the human race will find a way to undermine it. I believe in
capitalism because fair competition means the best and most efficient succeed.
I send my children to private schools and universities because I want my own children at the
top and not the best. Crony capitalism is inevitable, self-interest undermines any larger system
that we try and impose.
Can we design a system that can beat human self-interest? It's going to be tricky.
"If that's the system, how can I take advantage of it?" human nature at work. "If that's the
system, is it working for me or not?" those at the top.
If not, it's time to change the system.
If so, how can I tweak it to get more out of it?
Neo-Liberalism
Academics, who are not known for being street-wise, probably thought they had come up with
the ultimate system using markets and numeric performance measures to create a system free from
human self-interest.
They had already missed that markets don't just work for price discovery, but are frequently
used for capital gains by riding bubbles and hoping there is a "bigger fool" out there than you,
so you can cash out with a handsome profit.
(I am not sure if the Chinese realise markets are supposed to be for price discovery at all).
Hence, numerous bubbles during this time, with housing bubbles being the global favourite for
those looking for capital gains.
If we are being governed by the markets, how do we rig the markets?
A question successfully solved by the bankers.
Inflation figures, that were supposed to ensure the cost of living didn't rise too quickly,
were somehow manipulated to produce low inflation figures with roaring house price inflation raising
the cost of living.
What unemployment measure will best suit the story I am trying to tell?
U3 – everything great
U6 – it's not so good
Labour participation rate – it hasn't been this bad since the 1970s
Anything missing from the theory has been ruthlessly exploited, e.g. market bubbles ridden
for capital gains, money creation by private banks, the difference between "earned" and "unearned"
income and the fact that Capitalism trickles up through the following mechanism:
1) Those with excess capital collect rent and interest.
2) Those with insufficient capital pay rent and interest.
I just went on a rant last week. (Not only because the judge actually LIED in court)
I left the courthouse in downtown Seattle, to cross the street to find the vultures selling
more foreclosures on the steps of the King County Administration Building, while above them, there
were tents pitched on the building's perimeter. And people were walking by just like this scene
was normal.
Because the people at the entrance of the courthouse could view this, I went over there and
began to rant. I asked (loudly) "Do you guys see that over there? Vultures selling homes rendering
more people homeless and then the homeless encampment with tents pitched on the perimeter above
them? In what world is this normal?" One guy replied, "Ironic, isn't it?" After that comment,
the Marshall protecting the judicial crooks in the building came over and tried to calm me down.
He insisted that the scene across the street was "normal" and that none of his friends or neighbors
have been foreclosed on. I soon found out that that lying Marshall was from Pierce County, the
epicenter of Washington foreclosures.
"In this postindustrial world not only is the labor question no longer asked, not only
is proletarian revolution passé, but the proletariat itself seems passé. And the invisibles who
nonetheless do indeed live there have internalized their nonexistence, grown demoralized, resentful,
and hopeless; if they are noticed at all, it is as objects of public disdain. What were once called
"blue-collar aristocrats"-skilled workers in the construction trades, for example-have long felt
the contempt of the whole white-collar world.
For these people, already skeptical about who runs things and to what end, and who are now
undergoing their own eviction from the middle class, skepticism sours into a passive cynicism.
Or it rears up in a kind of vengeful chauvinism directed at alien others at home and abroad, emotional
compensation for the wounds that come with social decline If public life can suffer a metaphysical
blow, the death of the labor question was that blow. For millions of working people, it amputated
the will to resist."
One thing I don't think I have seen addressed on this site (apologies if I have missed it!)
in all the commentary about the destruction of the middle class is the role of US imperialism
in creating that middle class in the first place and what it is that we want to save from destruction
by neo-liberalism. The US is rich because we rob the rest of the world's resources and have been
doing so in a huge way since 1945, same as Britain before us. I don't think it's a coincidence
that the US post-war domination of the world economy and the middle class golden age happened
at the same time. Obviously there was enormous value created by US manufacturers, inventors, government
scientists, etc but imperialism is the basic starting point for all of this. The US sets the world
terms of trade to its own advantage. How do we save the middle class without this level of control?
Within the US elites are robbing everyone else but they are taking what we use our military power
to appropriate from the rest of the world.
Second, if Bernie or whoever saves the middle class, is that so that everyone can have a tract
house and two cars and continue with a massively wasteful and unsustainable lifestyle based on
consumption? Or are we talking about basic security like shelter, real health care, quality education
for all, etc? Most of the stories I see seem to be nostalgic for a time when lots of people could
afford to buy lots of stuff and don't 1) reflect on origin of that stuff (imperialism) and 2)
consider whether that lifestyle should be the goal in the first place.
I went to the electronics recycling facility in Seattle yesterday. The guy at customer service
told me that they receive 20 million pounds per month. PER MONTH. Just from Seattle. I went home
and threw up.
It doesn't have to be that way. You can replace military conquest (overt and covert) with space
exploration and science expansion. Also, instead of pushing consumerism, push contentment. Don't
setup and goose a system of "gotta keep up with the Joneses!"
In the 50s(!!!) there was a plan, proven in tests and studies, that would have had humans on
the mars by 1965, out to Saturn by 72. Project Orion. Later, the British Project Daedalus was
envisioned which WOULD have put space probes at the next star system within 20 years of launch.
It was born of the atomic age and, as originally envisioned, would have been an ecological disaster
BUT it was reworked to avoid this and would have worked. Spacecraft capable of comfortably holding
100 personnel, no need to build with paper-thin aluminum skin or skimp on amenities. A huge ship
built like a large sea vessel (heavy iron/steel) accelerated at 1g (or more or slightly less as
desired) so no prolonged weightlessness and concomitant loss of bone and muscle mass. It was all
in out hands but the Cold War got in the way, as did the many agreements and treaties of the Cold
War to avoid annihilation. It didn't need to be that way. Check it out:
https://en.wikipedia.org/wiki/Project_Orion_(nuclear_propulsion)
All that with 1950s and 60s era technology. It could be done better today and for less than
your wars in the Middle East. Encourage science, math, exploration instead of consumption, getting
mine before you can get yours, etc.
Or, we could replace Western liberal culture, with its tradition to consume and expand
by force an unbroken chain from the Garden of Eden to Friedrich von Hayek, with the notion of
maintenance and "enough". Bourgeois make-work holds no interest to me.
My understanding of the data is that living standards increased around the world during
the so-called golden age, not just in the U.S. (and Western Europe and Japan and Australia ).
It could be that it was still imperialism at work, but the link between imperialism and the creation
of the middle class is not straightforward.
Likewise, US elites are clearly NOT robbing the manufacturing firms that have set up in China
and other low-wage locations, so it is an oversimplification to say they are "robbing everyone
else."
Nostalgia is overrated but I don't sense the current malaise as a desire for more stuff. (I
grew up in the 60s and 70s and I don't remember it as a time where people had, or craved, a lot
of stuff. That period would be now, and I find it infects Sanders' supporters less than most.)
If anything, it is nostalgia for more (free) time and more community, for a time when (many but
not all) people had time to socialize and enjoy civic life.
those things would be nice as would just a tiny bit of hope for the future, our own and the
planet's and not an expectation of things getting more and more difficult and sometimes for entirely
unnecessary reasons like imposed austerity. But being we can't have "nice things" like free time,
community and hope for the future, we just "buy stuff".
I live on the south side, in the formerly affluent south shore neighborhood. A teenager was
killed, shot in the head in a drive by shooting, at 5 pm yesterday right around the corner from
my residence. A white coworker of mine who lives in a rich northwest side neighborhood once commented
to me how black people always say goodbye by saying "be safe". More easily said than done.
I thought neoliberalism was just the pogrom to make everyone – rational agents – as subscribed
by our genetic / heraldic betters .. putting this orbs humans and resources in the correct "natural"
order .
Disheveled Marsupial for those thinking neoliberalism is not associated with libertarianism
one only has to observe the decades of think tanks and their mouth organs roaming the planet .
especially in the late 80s and 90s . bringing the might and wonders of the – market – to the great
unwashed globally here libertarian priests rang in the good news to the great unwashed
I would argue that neoliberalism is a program to define markets as primarily engaged in
information processing and to make everyone into non-agents ( as not important at all to the proper
functioning of markets).
It also appears that neoliberals want to restrict democracy to the greatest extent possible
and to view markets as the only foundation for truth without any need for input from the average
individual.
But as Mirowski argues–carrying their analysis this far begins to undermine their own neoliberal
assumptions about markets always promoting social welfare.
When I mean – agents – I'm not referring to agency, like you say the market gawd/computer does
that. I was referencing the – rational agent – that 'ascribes' the markets the right at defining
facts or truth as neoliberalism defines rational thought/behavior.
Disheveled Marsupial yes democracy is a direct threat to Hayekian et al [MPS and Friends]
paranoia due to claims of irrationality vs rationally
I have trouble understanding the focus on an emergence of fascism in Europe, focus that seems
to dominate this entire thread when, put in perspective such splinter groups bear little weight
on the European political spectrum.
As an expat living in France, in my perception the Front National is a threat to the political
establishments that occupy the center left and right and whose historically broad constituencies
have been brutalized by the financial crisis borne of unbridled anglo-saxon runaway capitalism,
coined neoliberalism. The resulting disaffection has allowed the growth of the FN but it is also
fueled by a transfer of reactionary constituencies that have historically found identity in far
left parties (communist, anti-capitalist, anarchist ), political expressions the institutions
of the Republic allow and enable in the name of plurality, a healthy exultury in a democratic
society.
To consider that the FN in France, UKIP in the UK and others are a threat to democratic values
any more that the far left is non-sensical, and I dare say insignificant compared to the "anchluss"
our conservative right seeks to impose upon the executive, legislative and judicial branches of
government.
The reality in Europe as in America is economic. The post WWII era of reconstruction, investment
and growth is behind us, the French call these years the "Trente Glorieuses" (30 glorious years)
when prosperity was felt through all societal strats, consumerism for all became the panacea for
a just society, where injustice prevailed welfare formulas provided a new panacea.
As the perspective of an unravelling of this golden era began to emerge elites sought and conspired
to consolidate power and wealth, under the aegis of greed is good culture by further corrupting
government to serve the few, ensuring impunity for the ruling class, attempting societal cohesiveness
with brash hubristic dialectics (America, the greatest this or that) and adventurism (Irak, mission
accomplished), conspiring to co-opt and control institutions and the media (to understand the
depth of this deception a must read is Jane Mayer in The Dark Side and in Dark Money).
The difference between America and Europe is that latter bears of brunt of our excess.
The 2008 Wall St / City meltdown eviscerated much of America' middle class and de-facto stalled,
perhaps definitively, the vehicle of upward mobility in an increasingly wealth-ranked class structured
society – the Trump phenomena feeds off the fatalistic resilience and "good book" mythologies
remnant of the "go west" culture.
In Europe where to varying degrees managed capitalism prevails the welfare state(s) provided the
shock absorbers to offset the brunt of the crisis, but those who locked-in on neoliberal fiscal
conservatism have cut off their nose in spite leaving scant resources to spur growth. If social
mobility survives, more vibrantly than the US, unemployment and the cost thereof remains steadfast
and crippling.
The second crisis borne of American hubris is the human tidal wave resulting from the Irak adventure;
it has unleashed mayhem upon the Middle East, Sub Saharan Africa and beyond. The current migrational
wave Europe can not absorb is but the beginning of much deeper problem – as ISIS, Boko Haram and
so many others terrorist groups destabilize the nation-states of a continent whose population
is on the path to explode in the next half century.
The icing on the cake provided by a Trump election will be a world wave of climate change refugees
as the neoliberal establishment seeks to optimize wealth and power through continued climate change
denial.
Fascism is not the issue, nationalism resulting from a self serving bully culture will decimate
the multilateral infrastructure responsible nation-states need to address today's problems.
Broadly, Trump Presidency capping the neoliberal experience will likely signal the end of the
US' dominant role on the world scene (and of course the immense benefits derived for the US).
As he has articulated his intent to discard the art of diplomacy, from soft to institutional,
in favor of an agressive approach in which the President seeks to "rattle" allies (NATO, Japan
and S. Korea for example) as well as his opponents (in other words anyone who does not profess
blind allegiance), expect that such modus operandi will create a deep schism accompanied by a
loss of trust, already felt vis-a-vis our legislature' behavior over the last seven years.
The US's newfound respect among friends and foes generated by President Obama' presidency, has
already been undermined by the GOP primaries, if Trump is elected it will dissipate for good as
other nations and groups thereof focus upon new, no-longer necessarily aligned strategic relationships,
some will form as part as a means of taking distance, or protection from the US, others more opportunist
with the risk of opponents such as Putin filling the void – in Europe for example.
Neoliberalism isn't helping, but it's a population/resource ratio thing. Impacts on social
orders occur well before raw supply factors kick in (and there is more than food supply to basic
rations). The world population has more than doubled in the last 50 years, one doesn't get that
kind of accelerated growth without profound impacts to every aspect of societies. Some of the
most significant impacts are consequent to the acceleration of technological changes (skill expirations,
automations) that are driven in no small part by the needs of a vast + growing population.
I don't suggest population as a pat simplistic answer. And neoliberalism accelerates the declining
performance of institutions (as in the CUNY article and that's been going on for decades already,
neoliberalism just picked up where neoconservatism petered out), but we would be facing issues
like homelessness, service degradation, population displacements, etc regardless of poor policies.
One could argue (I do) that neoliberalism has undertaken to accelerate existing entropies for
profit.
Thanks for soliciting reader comments on socioeconomic desperation. It's encouraging to know
that I'm not the only failure to launch in this country.
I'm a seasonal farm worker with a liberal arts degree in geology and history. I barely held
on for six months as a junior environmental consultant at a dysfunctional firm that tacitly encouraged
unethical and incompetent behavior at all levels. From what I could gather, it was one of the
better-run firms in the industry. Even so, I was watching mid-level and senior staff wander into
extended mid-life crises while our entire service line was terrorized by a badly out-of-shape,
morbidly obese, erratic, vicious PG who had alienated almost the entire office but was untouchable
no matter how many firing offenses she committed. Meanwhile I was watching peers in other industries
(especially marketing and FIRE) sell their souls in real time. I'm still watching them do so a
decade later.
It's hard to exaggerate how atrociously I've been treated by bougie conformists for having
failed/dropped out of the rat race. A family friend who got into trouble with the state of Hawaii
for misclassifying direct employees of his timeshare boiler room as 1099's gave me a panic attack
after getting stoned and berating me for hours about how I'd wake up someday and wonder what the
fuck I'd done with my life. At the time, I had successfully completed a summer job as the de facto
lead on a vineyard maintenance crew and was about to get called back for the harvest, again as
the de facto lead picker.
Much of my social life is basically my humiliation at the hands of amoral sleazeballs who presume
themselves my superiors. No matter how strong an objective case I have for these people being
morally bankrupt, it's impossible to really dismiss their insults. Another big component is concern-trolling
from bourgeois supremacists who will do awfully little for me when I ask them for specific help.
I don't know what they're trying to accomplish, and they probably don't, either. A lot of it is
cognitive dissonance and incoherence.
Some of the worst aggression has come from a Type A social climber friend who sells life insurance.
He's a top producer in a company that's about a third normal, a third Willy Loman, and a third
Glengarry Glen Ross. This dude is clearly troubled, but in ways that neither of us can really
figure out, and a number of those around him are, too. He once admitted, unbidden, to having hazed
me for years.
The bigger problem is that he's surrounded by an entire social infrastructure that enables
and rewards noxious, predatory behavior. When college men feel like treating the struggling like
garbage, they have backup and social proof from their peers. It's disgusting. Many of these people
have no idea of how to relate appropriately to the poor or the unemployed and no interest in learning.
They want to lecture and humiliate us, not listen to us.
Dude recently told me that our alma mater, Dickinson College, is a "grad school preparatory
institution." I was floored that anyone would ever think to talk like that. In point of fact,
we're constantly lectured about how versatile our degrees are, with or without additional education.
I've apparently annoyed a number of Dickinsonians by bitterly complaining that Dickinson's nonacademic
operations are a sleazy racket and that President Emeritus Bill Durden is a shyster who brainwashed
my classmates with crude propaganda. If anything, I'm probably measured in my criticism, because
I don't think I know the full extent of the fraud and sleaze. What I have seen and heard is damning.
I believe that Dickinson is run by people with totalitarian impulses that are restrained only
by a handful of nonconformists who came for the academics and are fed up with the propaganda.
Meanwhile, I've been warm homeless for most of the past four years. It's absurd to get pledge
drive pitches from a well-endowed school on the premise that my degree is golden when I'm regularly
sleeping in my car and financially dependent on my parents. It's absurd to hear stories about
how Dickinson's alumni job placement network is top-notch when I've never gotten a viable lead
from anyone I know from school. It's absurd to explain my circumstances in detail to people who,
afterwards, still can't understand why I'm cynical.
While my classmates preen about their degrees, I'm dealing with stuff that would make them
vomit. A relative whose farm I've been tending has dozens of rats infesting his winery building,
causing such a stench that I'm just about the only person willing to set foot inside it. This
relative is a deadbeat presiding over a feudal slumlord manor, circumstances that he usually justifies
by saying that he's broke and just trying to make ends meet. He has rent-paying tenants living
on the property with nothing but a pit outhouse and a filthy, disused shower room for facilities.
He doesn't care that it's illegal. One of his tenants left behind a twenty-gallon trash can full
to the brim with his own feces. Another was seen throwing newspaper-wrapped turds out of her trailer
into the weeds. They probably found more dignity in this than in using the outhouse.
When I was staying in Rancho Cordova, a rough suburb of Sacramento, I saw my next-door neighbor
nearly come to blows with a man at the light rail station before apologizing profusely to me,
calling me "sir," "man," "boss," and "dog." He told me that he was angry at the other guy for
selling meth to his kid sister. Eureka is even worse: its west side is swarming with tweakers,
its low-end apartment stock is terrible, no one brings the slumlords to heel, and it has a string
of truly filthy residential motels along Broadway that should have been demolished years ago.
A colleague who lives in Sweet Home, Oregon, told me that his hometown is swarming with druggies
who try to extract opiates from local poppies and live for the next arriving shipment of garbage
drugs. The berry farm where we worked had ten- and twelve-year-olds working under the table to
supplement their families' incomes. A Canadian friend told me that he worked for a crackhead in
Lillooet who made his own supply at home using freebase that he bought from a meathead dealer
with ties to the Boston mob. Apparently all the failing mill towns in rural BC have a crack problem
because there's not much to do other than go on welfare and cocaine. An RCMP sergeant in Kamloops
was recently indicted for selling coke on the side.
Uahsenaa's comment about the invisible homeless is spot on. I think I blend in pretty well.
I've often stunned people by mentioning that I'm homeless. Some of them have been assholes about
it, but not all. There are several cars that I recognize as regular overnighters at my usual rest
area. Thank God we don't get hassled much. Oregon is about as safe a place as there is to be homeless.
Some of the rest areas in California, including the ones at Kingsburg and the Sacramento Airport,
end up at or beyond capacity overnight due to the homeless. CalTrans has signs reminding drivers
that it's rude to hog a space that someone else will need. This austerity does not, of course,
apply to stadium construction for the Kings.
Another thing that almost slipped my mind (and is relevant to Trump's popularity): I've encountered
entrenched, systemic discrimination against Americans when I've tried to find and hold menial
jobs, and I've talked to other Americans who have also encountered it. There is an extreme bias
in favor of Mexican peasants and against Americans in the fields and increasingly in off-farm
jobs. The top quintile will be lucky not to reap the whirlwind on account of this prejudice.
"... The number one issue fueling the leave vote was immigration – a lot like Trump's wall against Mexico. The number two issue was lack of accountability of government: Leavers believe that the EU government in Brussels is unaccountable to voters. For Trump supporters, resentment towards a distant and unaccountable Washington government ranks high as well. The Brexit constituency and the Trump constituency are both motivated by the same sense of loss and vulnerability. ..."
"... In both the U.S. and the U.K., a large and growing segment of voters has not prospered in today's complex, technology-driven global economy. Their wages have stagnated and in many cases fallen. Too few good-paying jobs exist for people lacking a college degree, or even people with a college degree, if the degree is not in the right field. These people are angry, frustrated, and afraid -- and with very good reason. Both countries' governments have done little to help them adapt, and little to soothe the sting of globalization. The voter's concerns in both places are mostly the same even though these concerns have coalesced around a policy issue ("leave") in the U.K. whereas here in the U.S. they have coalesced around a candidate (Trump). ..."
"... Similarly, the elite insiders of the Republican Party and their business allies badly underestimated Trump. Establishment candidates like former Florida Gov. Jeb Bush failed terribly. Now the Republican political insiders are trying to make sense of a presumptive nominee who trashes free trade, one of the fundamental principles of the party, and openly taunts one of most important emerging voting blocks. ..."
"... Perhaps the biggest reason for the impotence of today's political elites is that elites have trashed the very idea of competent and effective government for 35 years now, and the public has taken the message to heart. Ever since Reagan identified government as the problem, conservative elites have attacked the idea of government itself – rather than respecting the idea of government itself while criticizing the particular policies of a particular government. This is a crucial (and dangerous) distinction. In 1986, Reagan went on to say "the nine most terrifying words in the English language are 'I'm from the government and I'm here to help.'" ..."
In addition, the issues are similar between the two campaigns: The number
one issue fueling the leave vote was immigration – a lot like Trump's wall against
Mexico. The number two issue was lack of accountability of government: Leavers
believe that the EU government in Brussels is unaccountable to voters. For Trump
supporters, resentment towards a distant and unaccountable Washington government
ranks high as well. The Brexit constituency and the Trump constituency are both
motivated by the same sense of loss and vulnerability.
In both the U.S. and the U.K., a large and growing segment of voters
has not prospered in today's complex, technology-driven global economy. Their
wages have stagnated and in many cases fallen. Too few good-paying jobs exist
for people lacking a college degree, or even people with a college degree, if
the degree is not in the right field. These people are angry, frustrated, and
afraid -- and with very good reason. Both countries' governments have done little
to help them adapt, and little to soothe the sting of globalization. The voter's
concerns in both places are mostly the same even though these concerns have
coalesced around a policy issue ("leave") in the U.K. whereas here in the U.S.
they have coalesced around a candidate (Trump).
In both countries, political elites were caught flat-footed. Elites lost
control over the narrative and lost credibility and persuasiveness with angry,
frustrated and fearful voters. The British elites badly underestimated the intensity
of public frustration with immigration and with the EU. Most expected the vote
would end on the side of "remain," up to the very last moment. Now they are
trying to plot their way out of something they never expected would actually
happen, and never prepared for.
Similarly, the elite insiders of the Republican Party and their business
allies badly underestimated Trump. Establishment candidates like former Florida
Gov. Jeb Bush failed terribly. Now the Republican political insiders are trying
to make sense of a presumptive nominee who trashes free trade, one of the fundamental
principles of the party, and openly taunts one of most important emerging voting
blocks.
How did the elites lose control? There are many reasons: With social media
so pervasive, advertising dollars no longer controls what the public sees and
hears. With unrestricted campaign spending, the party can no longer "pinch the
air hose" of a candidate who strays from party orthodoxy.
Perhaps the biggest reason for the impotence of today's political elites
is that elites have trashed the very idea of competent and effective government
for 35 years now, and the public has taken the message to heart. Ever since
Reagan identified government as the problem, conservative elites have attacked
the idea of government itself – rather than respecting the idea
of government itself while criticizing the particular policies of a particular
government. This is a crucial (and dangerous) distinction. In 1986, Reagan went
on to say "the nine most terrifying words in the English language are 'I'm from
the government and I'm here to help.'"
Reagan booster Grover Norquist is known for saying, "I don't want to abolish
government. I simply want to reduce it to the size where I can drag it into
the bathroom and drown it in the bathtub." Countless candidates and elected
officials slam "Washington bureaucrats" even though these "bureaucrats" were
none other than themselves. It's not a great way to build respect. Then the
attack escalated, with the aim of destroying parts of government that were actually
mostly working. This was done to advance the narrative that government itself
is the problem, and pave the way for privatization. Take the Transportation
Security Administration for example. TSA has actually done its job. No terrorist
attacks have succeeded on U.S. airplanes since it was established. But by
systematically underfunding it , Congress has made the lines painfully long,
so people hate it. Take the Post Office. Here Congress manufactured a crisis
to force service cuts, making the public believe the institution is incompetent.
But the so-called "problem" is
due almost entirely to a requirement, imposed by Congress, forcing the Postal
Service to prepay retiree's health care to an absurd level, far beyond what
a similar private sector business would have to do. A similar dynamic now threatens
Social Security. Thirty-five years have passed since Reagan first mocked the
potential for competent and effective government. Years of unrelenting attack
have sunk in. Many Americans now distrust government leaders and think it's
pointless to demand or expect wisdom and statesmanship. Today's American voters
(and their British counterparts), well-schooled in skepticism, disdain and dismiss
leaders of all parties and they are ready to burn things down out of sheer frustration.
The moment of blowback has arrived.
PK has nearly lost all of his ability to see things objectively. Ambition got him, I suppose,
or maybe he has always longed to be popular. He was probably teased and ridiculed too much in
his youth. He is something of a whinny sniveler after-all.
Then too, I doubt if PK has ever used a public restroom in the Southwest, or taken his kids
to a public park in one of the thousands of small towns where non-English speaking throngs take
over all of the facilities and parking.Or had his children bullied at school by a gang of dark-skinned
kids whose parents believe that whites took their land, or abused or enslaved their distant ansestors.
It might be germane here too... to point out that some of this anti-white sentiment gets support
and validation from the very rhetoric that Democrats have made integral to their campaigns.
As for not knowing why crime rates have been falling, the incarceration rates rose in step,
so duh, if you lock up those with propensities for crime, well, how could crime rates not fall?
And while I'm on the subject of crime, the statistical analysis that is commonly used focuses
too much on violent crime and convictions. Thus, crimes of a less serious nature, that being the
type of crimes committed by poor folks, is routinely ignored. Then too, those who are here illegally
are often transient and using assumed names, and so they are, presumably, more difficult to catch.
So, statistics are all too often not as telling as claimed.
And, though I'm not a Trump supporter, I fully understand his appeal. As would PK if he were
more travelled and in touch with those who have seen their schools, parks, towns, and everything
else turn tawdry and dysfunctional. But of course the nation that most of us live in is much different
than the one that PK knows.
> And, though I'm not a Trump supporter, I fully understand his appeal
I wonder why everybody is thinking about this problem only in terms of identity politics.
This is a wrong, self-defeating framework to approach the problem. which is pushed by neoliberal
MSM and which we should resist in this forum as this translates the problems that the nation faces
into term of pure war-style propaganda ("us vs. them" mentality). To which many posters here already
succumbed
IMHO the November elections will be more of the referendum on neoliberal globalization (with
two key issues on the ballot -- jobs and immigration) than anything else.
If so, then the key question is whether the anger of population at neoliberal elite that stole
their jobs and well-being reached the boiling point or not. The level of this anger might decide
the result of elections, not all those petty slurs that neoliberal MSM so diligently use as a
smoke screen.
All those valiant efforts in outsourcing and replacing permanent jobs with temporary to increase
profit margin at the end have the propensity to produce some externalities. And not only in the
form "over 50 and unemployed" but also by a much more dangerous "globalization of indifference"
to human beings in general.
JK Galbraith once gave the following definition of neoliberal economics: "trickle down economics
is the idea that if you feed the horse enough oats eventually some will pass through to the road
for the sparrows." This is what neoliberalism is about. Lower 80% even in so-called rich countries
are forced to live in "fear and desperation", forced to work "with precious little dignity".
Human beings are now considered consumer goods in "job market" to be used and then discarded.
As a consequence, a lot of people find themselves excluded and marginalized: "without work, without
possibilities, without any means of escape" (pope Francis).
And that inevitably produces a reaction. Which in extreme forms we saw during French and Bolsheviks
revolutions. And in less extremist forms (not involving lampposts as the placeholders for the
"Masters of the Universe" (aka financial oligarchy) and the most obnoxious part of the "creative
class" aka intelligentsia
https://en.wikipedia.org/wiki/Intelligentsia
) in Brexit vote.
Hillary and Trump are just symbols here. The issue matters, not personalities.
"... Hillary Clinton and her lackeys will be taking a lot of heat for their shady actions in the primaries, get berned! ..."
"... How could Hillary be the best qualified candidate of all time??? She was a liar. Just being a woman does not automatically make you the best person ..."
"... A nice way of understanding this is the media, pollsters and pseudo liberal's use of the term popularist. This has been identified as the danger and a type of ignorance/stupidity if you just reflect for a moment it could be seen as a synonym for the majority. ..."
"... Trump' victory marks the profound failures of the political and economic system in America and across the West. It is a complete failure of the Clinton and the DNC establishment approach to politics ..."
"... The Guardian should have supported Bernie Sanders' campaign. There was a systemic failure to acknowledge and recognise the intense disillusionment and sweeping anti-establishment zeitgeist among huge numbers of the electorate both in America and Europe. ..."
How could Hillary be the
best qualified candidate of
all time??? She was a liar.
Just being a woman does not
automatically make you the
best person, there are other
honest and more competent
women.
Granted Trump isn't
ideal but Hilary was equally
divisive and assumed the
whole fiasco was about her
being the first woman to
make it into the white house
than the policy issues that
needed serious tackling.
This is a revolution against
the media and the pollsters
stuck in the washington/westminster
bubble. It was obvious to
any objective observer that
Trump was going to win.
The liberal media and the
pollsters just as in Brexit
have had an incredulous
bioptic view of what was
happening.
Not once in 18 months has
there been a serious attempt
to understand Trump's appeal
and what he was really
saying, not once.
A nice way of understanding
this is the media, pollsters
and pseudo liberal's use of
the term popularist. This
has been identified as the
danger and a type of
ignorance/stupidity if you
just reflect for a moment it
could be seen as a synonym
for the majority.
The people want change even
if it comes from Trump.
I wonder if Farage is
thinking of staying on as
leader?
Trump' victory marks the
profound failures of the
political and economic
system in America and across
the West. It is a complete
failure of the Clinton and
the DNC establishment
approach to politics.
The
Guardian should have
supported Bernie Sanders'
campaign. There was a
systemic failure to
acknowledge and recognise
the intense disillusionment
and sweeping
anti-establishment zeitgeist
among huge numbers of the
electorate both in America
and Europe.
The reasons for the election of Donald Trump as President of the U.S. will be analyzed and argued
about for many years to come. Undoubtedly there are U.S.-specific factors that are relevant, such
as racial divisions in voting patterns. But the election took place after the British vote to withdraw
from the European Union and the rise to power of conservative politicians in continental Europe,
so it is reasonable to ask whether globalization bears any responsibility.
Have foreign workers taken the jobs of U.S. workers? Increased trade does lead to a reallocation
of resources, as a country increases its output in those sectors where it has an advantage while
cutting back production in other sectors. Resources should flow from the latter to the former, but
in reality it can be difficult to switch employment across sectors.
Daron Acemoglu and David Autor of MIT,
David Dorn of the University of Zurich, Gordon Hanson of UC-San Diego and Brendan Price of MIT
have found that import competition from China after 2000 contributed to reductions in U.S. manufacturing
employment and weak U.S. job growth. They estimated manufacturing job losses due to Chinese competition
of 2.0 – 2.4 million.
Other studies
find similar results for workers who do not have high school degrees.
Moreover, multinational firms do shift production across borders in response to lower wages, among
other factors.
Ann E. Harrison of UC-Berkeley and Margaret S. McMillan of Tufts University looked at the hiring
practices of the foreign affiliates of U.S. firms during the period of 1977 to 1999. They found that
lower wages in affiliate countries where the employees were substitutes for U.S. workers led to more
employment in those countries but reductions in employment in the U.S. However, when employment across
geographical locations is complementary for firms that do significantly different work at home and
abroad, domestic and foreign employment rise and fall together.
Imports and foreign production, therefore, have had an impact on manufacturing employment in the
U.S. But several caveats should be raised. First, as
Erik Brynjolfsson and Andrew McAfee of MIT and others have pointed out, technology has had a
much larger effect on jobs. The U.S. is the second largest global producer of manufactured goods,
but these products are being made in plants that employ fewer workers than they did in the past.
Many of the lost jobs simply do not exist any more. Second, the U.S. exports goods and services as
well as purchases them. Among the manufactured goods that account for significant shares of U.S.
exports are
machines
and engines, electronic equipment and aircraft . Third, there is inward FDI as well as outward,
and the foreign-based firms hire U.S. workers. A 2013
Congressional Research Service
study by James V. Jackson reported that by year-end 2011 foreign firms employed 6.1 million Americans,
and 37% of this employment-2.3 million jobs-was in the manufacturing sector.
More recent data
shows that employment by the U.S. affiliates of multinational companies rose to 6.4 million in
2014. Mr. Trump will find himself in a difficult position if he threatens to shut down trade and
investment with countries that both import from the U.S. and invest here.
The other form of globalization that drew Trump's derision was immigration. Most of his ire focused
on those who had entered the U.S. illegally. However, in a speech in Arizona he said that he would
set up a commission that would
roll back the number of legal migrants to "historic norms."
The
current number of immigrants (42 million) represents around 13% of the U.S. population, and 16%
of the labor force. An increase in the number of foreign-born workers depresses the wages of some
native-born workers, principally high-school dropouts, as well as other migrants who arrived earlier.
But there are other, more significant reasons for the
stagnation in
working-class wages . In addition, a reduction in the number of migrant laborers would raise
the ratio of young and retired people to workers-the dependency ratio-and endanger the financing
of Social Security and Medicare. And by increasing the size of the U.S. economy,
these workers induce expansions in investment expenditures and hiring in areas that are complementary.
The one form of globalization that Trump has not criticized, with the exception of outward FDI,
is financial. This is a curious omission, as the crisis of 2008-09 arose from the financial implosion
that followed the collapse of the housing bubble in the U.S. International financial flows exacerbated
the magnitude of the crisis. But
Trump has pledged
to dismantle the Dodd-Frank legislation, which was enacted to implement financial regulatory
reform and lower the probability of another crisis. While
Trump has criticized China for undervaluing its currency in order to increase its exports to
the U.S., most economists believe that the
Chinese currency is no longer undervalued vis-à-vis the U.S. dollar.
Did globalization produce Trump, or lead to the circumstances that resulted in
46.7% of the electorate voting
for him? A score sheet of the impact of globalization within the U.S. would record pluses and minuses.
Among those who have benefitted are consumers who purchase items made abroad at cheaper prices, workers
who produce export goods, and firms that hire migrants. Those who have been adversely affected include
workers who no longer have manufacturing jobs and domestic workers who compete with migrants for
low-paying jobs. Overall, most studies find evidence of
positive net benefits from trade . Similarly,
studies of the cost and benefits of immigration indicate that overall foreign workers make a
positive contribution to the U.S. economy.
Other trends have exerted equal or greater consequences for our economic welfare. First, as pointed
out above, advances in automation have had an enormous impact on the number and nature of jobs, and
advances in artificial intelligence wii further change the nature of work. The launch of driverless
cars and trucks, for example, will affect the economy in unforeseen ways, and more workers will lose
their livelihoods. Second, income inequality has been on the increase in the U.S. and elsewhere for
several decades. While those in the upper-income classes have benefitted most from increased trade
and finance, inequality reflects many factors besides globalization.
Why, then, is globalization the focus of so much discontent? Trump had the insight that demonizing
foreigners and U.S.-based multinationals would allow him to offer simple solutions-ripping up trade
deals, strong-arming CEOs to relocate facilities-to complex problems. Moreover, it allows him to
draw a line between his supporters and everyone else, with Trump as the one who will protect workers
against the crafty foreigners and corrupt elite who conspire to steal American jobs. Blaming the
foreign "other" is a well-trod route for those who aspire to power in times of economic and social
upheaval.
Globalization, therefore, should not be held responsible for the election of Donald Trump and
those in other countries who offer similar simplistic solutions to challenging trends. But globalization's
advocates did indirectly lead to his rise when they oversold the benefits of globalization and neglected
the downside. Lower prices at Wal-Mart are scarce consolation to those who have lost their jobs.
Moreover, the proponents of globalization failed to strengthen the safety networks and redistributive
mechanisms that allow those who had to compete with foreign goods and workers to share in the broader
benefits.
Dani Rodrik of Harvard's Kennedy School has described how the policy priorities were changed:
"The new model of globalization stood priorities on their head, effectively putting democracy to
work for the global economy, instead of the other way around. The elimination of barriers to trade
and finance became an end in itself, rather than a means toward more fundamental economic and social
goals."
The battle over globalization is not finished, and there will be future opportunities to adapt
it to benefit a wider section of society. The goal should be to place it within in a framework that
allows a more egalitarian distribution of the benefits and payment of the costs. This is not a new
task. After World War II, the Allied planners sought to revive international trade while allowing
national governments to use their policy tools to foster full employment. Political scientist
John
Ruggie of the Kennedy School called the hybrid system based on fixed exchange rates, regulated
capital accounts and government programs "
embedded liberalism
," and it prevailed until it was swept aside by the wave of neoliberal policies in the 1980s
and 1990s.
What would today's version of "embedded liberalism" look like? In the financial sector, the pendulum
has already swung back from unregulated capital flows and towards the use of capital control measures
as part of macroprudential policies designed to address systemic risk in the financial sector. In
addition,
Thomas Piketty of the École des hautes etudes en sciences (EHESS) and associate chair at the Paris
School of Economics , and author of Capital in the Twenty-first Century, has called
for a new focus in discussions over the next stage of globalization: " trade is a good thing, but
fair and sustainable development also demands public services, infrastructure, health and education
systems. In turn, these themselves demand fair taxation systems."
The current political environment is not conducive toward the expansion of public goods. But it
is unlikely that our new President's policies will deliver on their promise to return to a past when
U.S. workers could operate without concern for foreign competition or automation. We will certainly
revisit these issues, and we need to redefine what a successful globalization looks like. And if
we don't? Thomas Piketty warns of the consequences of not enacting the necessary domestic policies
and institutions: "If we fail to deliver these, Trump_vs_deep_state will prevail."
Since 1980, US manufacturing output has approximately doubled while manufacturing employment
fell by about a third.
Yes, globalization impacts the composition of output and it is a contributing factor in the
weaker growth of manufacturing output. but overall it has accounted for a very minor share of
the weakness in manufacturing employment since 1980. Productivity has been the dominant factor
driving manufacturing employment down.
JimH November 29, 2016 11:11 am
"Overall, most studies find evidence of positive net benefits from trade."
Of course they do! And in your world, studies always Trump real world experience.
Studies on trade can ignore the unemployed workers with a high school education or less. How
were they supposed to get an equivalent paying job? EDUCATION they say! A local public university
has a five year freshman graduation rate of 25%. Are those older students to eat dirt while attempting
to accumulate that education!
Studies on trade can ignore that illegal immigration increases competition for the those under
educated employees. Since 1990 there has been a rising demand that education must be improved!
That potential high school drop outs should be discouraged by draconian means if necessary. YET
we allow immigrants to enter this country and STAY with less than the equivalent of an American
high school education! Why are we spending so much on secondary education if it is not necessary!
"In Mexico, 34% of adults aged 25-64 have completed upper secondary education, much lower than
the OECD average of 76% the lowest rate amongst OECD countries."
See: http://www.oecdbetterlifeindex.org/countries/mexico/
Trade studies can ignore the fate of a small town when its major employer shuts down and leaves.
Trade studies can assume that we are one contiguous job market. They can assume that an unemployed
worker in Pennsylvania will learn of a good paying job in Washington state, submit an application,
and move within 2 weeks. Or assume that the Washington state employer will hold a factory job
open for a month! And they can assume that moving expenses are trivial for an unemployed person.
Our trade partners have not attempted anything remotely resembling balanced trade with us.
Here are the trade deficits since 1992.
Year__________US Trade Balance with the world
1992__________-39,212
1993__________-70,311
1994__________-98,493
1995__________-96,384
1996__________-104,065
1997__________-108,273
1998__________-166,140
1999__________-258,617
2000__________-372,517
2001__________-361,511
2002__________-418,955
2003__________-493,890
2004__________-609,883
2005__________-714,245
2006__________-761,716
2007__________-705,375
2008__________-708,726
2009__________-383,774
2010__________-494,658
2011__________-548,625
2012__________-536,773
2013__________-461,876
2014__________-490,176
2015__________-500,361
From:
https://www.census.gov/foreign-trade/statistics/historical/gands.pdf
AND there is the loss of the income from tariffs which had been going to the federal government!
How has that effected our national debt?
"However, when employment across geographical locations is complementary for firms that do
significantly different work at home and abroad, domestic and foreign employment rise and fall
together."
And exactly how do you think that the US government could guarantee that complementary work
at home and abroad. Corporations are profit seeking, amoral entities, which will seek profit any
way they can. (Legal or illegal)
The logical conclusion of your argument is that we could produce nothing and still have a thriving
economy. How would American consumers earn an income?
Indiana, Michigan, Ohio, Pennsylvania, and Wisconsin are RUST BELT states. Were the voters
there merely ignorant or demented? You should never ever run for elected office.
Beverly Mann November 29, 2016 12:30 pm
Meanwhile, Trump today chose non-swampy Elaine Chao, Mitch McConnell's current wife and GWBush's
former Labor Secretary, as Transportation Secretary, to privatize roads, bridges, etc.
JimH November 29, 2016 12:36 pm
The trade balances are in millions of dollars in the table in my last comment.
Global trade had a chance of success beginning in 1992. But that required a mechanism which
was very difficult to game. A mechanism like the one that the Obama administration advocated in
October 2010.
"At the meeting in South Korea's southern city of Gyeongju, U.S. officials sought to set a
cap for each country's deficit or surplus at 4% of its economic output by 2015.
The idea drew support from Britain, Australia, Canada and France, all of which are running trade
deficits, as well as South Korea, which is hosting the G-20 meetings and hoping for a compromise
among the parties.
But the proposal got a cool reception from export powerhouses such as China, which has a current
account surplus of 4.7% of its gross domestic product; Germany, with a surplus of 6.1%; and Russia,
with a surplus of 4.7%, according to IMF statistics."
See:
http://articles.latimes.com/2010/oct/24/business/la-fi-g20-summit-20101024
That cap was probably too high. But at least the Obama administration showed some realization
that global trade was exhibiting serious unpredicted problems. Too bad that Hillary Clinton could
not have internalized that realization enough to campaign on revamping problematic trade treaties.
(And persuaded a few more of the voters in the RUST BELT to vote for her.) Elections have consequences
and voters understand that, but what choice did they have?
In your world, while American corporations act out in ways that would be diagnosed as antisocial
personality disorder in a human being, American human beings are expected to wait patiently for
decades while global trade is slowly adjusted into some practical system. (As one shortcoming
after another is addressed.)
The article states almost exactly what you 'add' in your comment:
"Imports and foreign production, therefore, have had an impact on manufacturing employment
in the U.S. But several caveats should be raised. First, as Erik Brynjolfsson and Andrew McAfee
of MIT and others have pointed out, technology has had a much larger effect on jobs".
So, what gives? Is there an award today for who ever gets the biggest DUH??? If there is anything
worth adding, it would be a mention of the Ball St study that supports the author's claim but
is somehow overlooked. But your comment, well, DUH!!
=================================================
JimH,
Some good stuff there, your assessment of Economics and its penchant for ignoring variables,
and your insight which states that "studies can assume that we are one contiguous job market",
is all very true, and especially when it comes to immigration issues. I've lived most of my life
near the Southern border and when economists claim that undocumented workers are good for our
economy I can only chuckle and shake my head. I suppose I could also list all of the variables
which those economists ignore, and there are many to choose from, but, there is that quote by
Upton Sinclair: "You can't get a man to understand what his salary depends on his not understanding".
In all fairness though, The Dept. of Labor does of course have its JOLTS data, and so not all
such studies are based on broad assumptions, but Economics does have its blind spots, generally
speaking. And of course economists apply far too much effort and energy serving their political
and financial masters.
As for your comment in regards to the the trade deficit, you might want to read up a little
on the Triffin Dilemma. The essence of globalization has a lot to do with the US leadership choosing
to maintain the reserve-currency status and Triffin showed that an increasing amount of dollars
must supply the world's demand for dollars, or, global growth would falter. So, the trade deficit
since 1975 has been intentional, for that reason, and others. Of course the cost of labor in the
US was a factor too, and shipping and standards and so on. But, it is wise also, to remember that
these choices were made at time, during and just after the Viet Nam war, when military recruitment
was a very troubling issue for the leadership. And the option of good paying jobs for the working-class
was very probably seen as in conflict with military recruitment. Accordingly, the working-class
has been left with fewer options. This being accomplished in part with the historical anomaly
of high immigration quotas, (and by the tolerance for illegal immigration), during periods with
high unemployment, a falling participation-rate, inadequate infrastructure, and etc.
Ray LaPan-Love November 29, 2016 2:18 pm
JimH,
After posting my earlier comment it occurred to me that I should have recommended an article
by Tim Taylor that has some good info on the Triffin dilemma.
Also, it might be worth mentioning that you are making the common mistake of assigning blame
to an international undertaking that would be more accurately assigned to national shortcomings.
I'm referring here to what you quoted and said:
""Overall, most studies find evidence of positive net benefits from trade.""
"Of course they do! And in your world, studies always Trump real world experience".
My point being that "positive net benefits from trade" are based on just another half-baked
measurement as you suggest, but the problems which result from trade-related displacements are
not necessarily the fault of trade itself. There are in fact political options, for example, immigration
could have been curtailed about 40 years ago and we would now have about 40 million fewer citizens,
and thus there would almost certainly be more jobs available. Or, the laws pertaining to illegal
immigration could have been enforced, or the 'Employee Free Choice Act could have been passed,
or whatever, and then trade issues may have had much different impact.
Ray LaPan-Love November 29, 2016 3:12 pm
It seems worth mentioning here, that there are other more important goals that make globalization
valuable than just matters of money or employment or who is getting what. Let us not forget the
famous words of Immanuel Kant:
"the spirit of commerce . . . sooner or later takes hold of every nation, and is incompatible
with war."
coberly November 29, 2016 6:33 pm
Ray
the spirit of commerce did not prevent WW1 or WW2.
otherwise, thank you, and Jim H and Joseph Joyce for the first Post and Comments for grownups
we've had around here in some time.
Ray LaPan-Love November 29, 2016 7:03 pm
Hey Coberly, long time no see.
And yes, you are right, 'the spirit of commerce' theory has had some ups and downs. But, one
could easily and accurately argue that the effort which began with the League of Nations, and
loosely connects back to Kant's claim, has gained some ground since WW2. There has not, after-all,
been a major war since.
So, when discussing the pros and cons of globalization, that factor, as I said, is worthy of
mention. And it was a key consideration in the formation of the Bretton Woods institutions, and
in the globalization effort in general. This suggesting then that there are larger concerns than
the unemployment-rate, or the wage levels, of the working-class folks who may, or may not, have
been at the losing end of 'free-trade'.
I've been a 'labor-lefty' since the 1970s, but I am still capable of understanding that things
could have been much worse for the American working-class. Plus, if anyone must give up a job,
who better than those with a fairly well-constructed safety-net. History always has its winners
and losers, and progress rarely, if ever, comes in an even flow.
Meanwhile, those living in extreme poverty, worldwide, have dropped from 40% in 1981, to about
10% in 2015 (World Bank), so, progress is occurring. But of course much of that is now being ignored
by the din which has drowned out so many considerations that really do matter, and a great deal.
coberly November 29, 2016 8:25 pm
Ray
I am inclined to agree with you, but sometimes it's hard to see the forest for the trees. Especially
if one of those trees has fallen on you.
In general I am more interested in stopping predatory business models that really hurt people
than in creating cosmic justice.
as for the relative lack of big wars since WW2, I always thought that was because of mutual
assured destruction. I am sure Vietnam looked like a big enough war to the Vietnamese.
Tsar Nicholas II: I know what will make them happy. They're children, and they
need a Tsar! They need tradition. Not this! They're the victims of agitators.
A Duma would make them bewildered and discontented. And don't tell me about London and Berlin.
God save us from the mess they're in!
Count Witte: I see. So they talk, pray, march, plead, petition and what do
they get? Cossacks, prison, flogging, police, spies, and now, after today, they will be shot.
Is this God's will? Are these His methods? Make war on your own people?
How long do you think they're going to stand there and let you shoot them? YOU ask ME who's
responsible? YOU ask?
Tsar Nicholas II: The English have a parliament. Our British cousins
gave their rights away. The Hapsburgs, and the Hoehenzollerns too. The Romanovs
will not. What I was given, I will give my son.
"People of privilege will always risk their complete destruction rather than surrender any material
part of their advantage. Intellectual myopia, often called stupidity, is no doubt a reason. But the
privileged also feel that their privileges, however egregious they may seem to others, are a solemn,
basic, God-given right. The sensitivity of the poor to injustice is a trivial thing compared with
that of the rich."
It is the end of neoliberalism and the start of the era of authoritarian nationalism, and we all
need to come together to stamp out the authoritarian part.
Notable quotes:
"... Neoliberalism has been disastrous for the Rust Belt, and I think we need to envision a new future for what was once the country's industrial heartland, now little more than its wasteland ..."
"... The question of what the many millions of often-unionized factory workers, SMEs which supplied them, family farmers (now fully industrialized and owned by corporations), and all those in secondary production and services who once supported them are to actually do in future to earn a decent living is what I believe should really be the subject of debate. ..."
"... two factors (or three, I guess) have contributed to this state of despair: offshoring and outsourcing, and technology. ..."
"... Medicaid, the CHIP program, the SNAP program and others (including NGOs and private charitable giving) may alleviate some of the suffering, but there is currently no substitute for jobs that would enable men and women to live lives of dignity – a decent place to live, good educations for their children, and a reasonable, secure pension in old age. Near-, at-, and below-minimum wage jobs devoid of any benefits don't allow any of these – at most, they make possible a subsistence life, one which requires continued reliance on public assistance throughout one's lifetime. ..."
"... In the U.S. (a neoliberal pioneer), poverty is closely linked with inequality and thus, a high GINI coefficient (near that of Turkey); where there is both poverty and a very unequal distribution of resources, this inevitably affects women (and children) and racial (and ethnic) minorities disproportionately. The economic system, racism, sexism, and xenophobia are not separate, stand-alone issues; they are profoundly intertwined. ..."
"... But really, if you think about it, slavery was defined as ownership, ownership of human capital (which was convertible into cash), and women in many societies throughout history were acquired as part of a financial transaction (either through purchase or through sale), and control of their capital (land, property [farmland, herds], valuables and later, money) often entrusted to a spouse or male guardian. All of these practices were economically-driven, even if the driver wasn't 21st-century capitalism. ..."
"... Let it be said at once: Trump's victory is primarily due to the explosion in economic and geographic inequality in the United States over several decades and the inability of successive governments to deal with this. ..."
"... Both the Clinton and the Obama administrations frequently went along with the market liberalization launched under Reagan and both Bush presidencies. At times they even outdid them: the financial and commercial deregulation carried out under Clinton is an example. What sealed the deal, though, was the suspicion that the Democrats were too close to Wall Street – and the inability of the Democratic media elite to learn the lessons from the Sanders vote. ..."
"... Regional inequality and globalization are the principal drivers in Japanese politics, too, along with a number of social drivers. ..."
"... The tsunami/nuclear meltdown combined with the Japanese government's uneven response is an apt metaphor for the impact of neo-liberalism/globalization on Japan; and on the US. I then explained that the income inequality in the US was far more severe than that of Japan and that many Americans did not support the export of jobs to China/Mexico. ..."
"... I contend that in some hypothetical universe the DNC and corrupt Clinton machine could have been torn out, root and branch, within months. As I noted, however, the decision to run HRC effectively unopposed was made several years, at least, before the stark evidence of the consequences of such a decision appeared in sharp relief with Brexit. ..."
"... Just as the decline of Virginia coal is due to global forces and corporate stupidity, so the decline of the rust belt is due to long (30 year plus) global forces and corporate decisions that predate the emergence of identity politics. ..."
"... It's interesting that the clear headed thinkers of the Marxist left, who pride themselves on not being distracted by identity, don't want to talk about these factors when discussing the plight of their cherished white working class. ..."
"... The construction 'white working class' is a useful governing tool that splits poor people and possible coalitions against the violence of capital. Now, discussion focuses on how some of the least powerful, most vulnerable people in the United States are the perpetrators of a great injustice against racialised and minoritised groups. Such commentary colludes in the pathologisation of the working class, of poor people. Victims are inculpated as the vectors of noxious, atavistic vices while the perpetrators get off with impunity, showing off their multihued, cosmopolitan C-suites and even proposing that their free trade agreements are a form of anti-racist solidarity. Most crucially, such analysis ignores the continuities between a Trumpian dystopia and our satisfactory present. ..."
"... Race-thinking forecloses the possibility of the coalitions that you imagine, and reproduces ideas of difference in ways that always, always privilege 'whiteness'. ..."
"... Historical examples of ethnic groups becoming 'white', how it was legal and political decision-making that defined the present racial taxonomy, suggest that groups can also lose or have their 'whiteness' threatened. CB has written here about how, in the UK at least, Eastern and Southern Europeans are racialised, and so refused 'whiteness'. JQ has written about southern white minoritisation. Many commentators have pointed that the 'white working class' vote this year looked a lot like a minority vote. ..."
"... Given the subordination of groups presently defined as 'white working class', I wonder if we could think beyond ethnic and epidermal definition to consider that the impossibility of the American Dream refuses these groups whiteness; i.e the hoped for privileges of racial superiority, much in the same way that African Americans, Latin Americans and other racialised minorities are denied whiteness. Can a poor West Virginian living in a toxified drugged out impoverished landscape really be defined as a carrier of 'white privilege'? ..."
"... I was first pointed at this by the juxtapositions of racialised working class and immigrants in Imogen Tyler's Revolting Subjects – Social Abjection and Resistance in Neoliberal Britain but this below is a useful short article that takes a historical perspective. ..."
"... In a 1990 essay, the late Yale political scientist Juan Linz observed that "aside from the United States, only Chile has managed a century and a half of relatively undisturbed constitutional continuity under presidential government - but Chilean democracy broke down in the 1970s." ..."
"... Linz offered several reasons why presidential systems are so prone to crisis. One particularly important one is the nature of the checks and balances system. Since both the president and the Congress are directly elected by the people, they can both claim to speak for the people. When they have a serious disagreement, according to Linz, "there is no democratic principle on the basis of which it can be resolved." The constitution offers no help in these cases, he wrote: "the mechanisms the constitution might provide are likely to prove too complicated and aridly legalistic to be of much force in the eyes of the electorate." ..."
"... In a parliamentary system, deadlocks get resolved. A prime minister who lacks the backing of a parliamentary majority is replaced by a new one who has it. If no such majority can be found, a new election is held and the new parliament picks a leader. It can get a little messy for a period of weeks, but there's simply no possibility of a years-long spell in which the legislative and executive branches glare at each other unproductively.' ..."
"... In any case, as I pointed out before, given that the US is increasingly an urbanised country, and the Electoral College was created to protect rural (slave) states, the grotesque electoral result we have just seen is likely to recur, which means more and more Presidents with dubious democratic legitimacy. Thanks to Bush (and Obama) these Presidents will have, at the same time, more and more power. ..."
"... To return to my original question and answer it myself: I'm forced to conclude that the Democrats did not specifically address the revitalization – rebirth of the Rust Belt in their 2016 platform. Its failure to do so carried a heavy cost that (nearly) all of us will be forced to pay. ..."
"... This sub seems to have largely fallen into the psychologically comfortable trap of declaring that everyone who voted against their preferred candidate is racist. It's a view pushed by the neoliberals, who want to maintain he stranglehold of identity politics over the DNC, and it makes upper-class 'intellectuals' feel better about themselves and their betrayal of the filthy, subhuman white underclass (or so they see it). ..."
"... You can scream 'those jobs are never coming back!' all you want, but people are never going to accept it. So either you come up with a genuine solution (instead of simply complaining that your opponents solutions won't work; you're partisan and biased, most voters won't believe you), you may as well resign yourself to fascism. Because whining that you don't know what to do won't stop people from lining up behind someone who says that they do have one, whether it'll work or not. Nobody trusts the elite enough to believe them when they say that jobs are never coming back. Nobody trusts the elite at all. ..."
"... You sound just like the Wiemar elite. No will to solve the problem, but filled with terror at the inevitable result of failing to solve the problem. ..."
"... One brutal fact tells us everything we need to know about the Democratic party in 2016: the American Nazi party is running on a platform of free health care to working class people. This means that the American Nazi Party is now running to the left of the Democratic party. ..."
"... Back in the 1930s, when the economy collapsed, fascists appeared and took power. Racists also came out of the woodwork, ditto misogynists. Fast forward 80 years, and the same thing has happened all over again. The global economy melted down in 2008 and fascists appeared promising to fix the problems that the pols in power wouldn't because they were too closely tied to the existing (failed) system. Along with the fascists, racists gained power because they were able to scapegoat minorities as the alleged cause of everyone's misery. ..."
"... None of this is surprising. We have seen it before. Whenever you get a depression in a modern industrial economy, you get scapegoating, racism, and fascists. We know what to do. The problem is that the current Democratic party isn't doing it. ..."
"... . It is the end of neoliberalism and the start of the era of authoritarian nationalism, and we all need to come together to stamp out the authoritarian part. ..."
"... This hammered people on the bottom, disproportionately African Americans and especially single AA mothers in America. It crushed the blue collar workers. It is wiping out the savings and careers of college-educated white collar workers now, at least, the ones who didn't go to the Ivy League, which is 90% of them. ..."
"... Calling Hillary an "imperfect candidate" is like calling what happened to the Titanic a "boating accident." Trump was an imperfect candidate. Why did he win? ..."
"... "The neoliberal era in the United States ended with a neofascist bang. The political triumph of Donald Trump shattered the establishments in the Democratic and Republican parties – both wedded to the rule of Big Money and to the reign of meretricious politicians." ..."
"... "It is not an exaggeration to say that the Democratic Party is in shambles as a political force. Not only did it just lose the White House to a wildly unpopular farce of a candidate despite a virtually unified establishment behind it, and not only is it the minority party in both the Senate and the House, but it is getting crushed at historical record rates on the state and local levels as well. Surveying this wreckage last week, party stalwart Matthew Yglesias of Vox minced no words: `the Obama years have created a Democratic Party that's essentially a smoking pile of rubble.' ..."
"... "One would assume that the operatives and loyalists of such a weak, defeated and wrecked political party would be eager to engage in some introspection and self-critique, and to produce a frank accounting of what they did wrong so as to alter their plight. In the case of 2016 Democrats, one would be quite mistaken." ..."
"... Foreign Affairs ..."
"... "At the end of World War II, the United States and its allies decided that sustained mass unemployment was an existential threat to capitalism and had to be avoided at all costs. In response, governments everywhere targeted full employment as the master policy variable-trying to get to, and sustain, an unemployment rate of roughly four percent. The problem with doing so, over time, is that targeting any variable long enough undermines the value of the variable itself-a phenomenon known as Goodhart's law. (..) ..."
"... " what we see [today] is a reversal of power between creditors and debtors as the anti-inflationary regime of the past 30 years undermines itself-what we might call "Goodhart's revenge." In this world, yields compress and creditors fret about their earnings, demanding repayment of debt at all costs. Macro-economically, this makes the situation worse: the debtors can't pay-but politically, and this is crucial-it empowers debtors since they can't pay, won't pay, and still have the right to vote. ..."
"... "The traditional parties of the center-left and center-right, the builders of this anti-inflationary order, get clobbered in such a world, since they are correctly identified by these debtors as the political backers of those demanding repayment in an already unequal system, and all from those with the least assets. This produces anti-creditor, pro-debtor coalitions-in-waiting that are ripe for the picking by insurgents of the left and the right, which is exactly what has happened. ..."
"... "The global revolt against elites is not just driven by revulsion and loss and racism. It's also driven by the global economy itself. This is a global phenomenon that marks one thing above all. The era of neoliberalism is over. The era of neonationalism has just begun." ..."
"... They want what their families have had which is secure, paid, benefits rich, blue collar work. ..."
"... trump's campaign empathized with that feeling just by focusing on the factory jobs as jobs and not as anachronisms that are slowly fading away for whatever reason. Clinton might have been "correct", but these voters didn't want to hear "the truth". And as much as you can complain about how stupid they are for wanting to be lied to, that is the unfortunate reality you, and the Democratic party, have to accept. ..."
"... trump was offering a "bailout" writ large. Clinton had no (good) counteroffer. It was like the tables were turned. Romney was the one talking about "change" and "restructuring" while Obama was defending keeping what was already there. ..."
"... "Without that bailout, Detroit will need to drastically restructure itself. With it, the automakers will stay the course - the suicidal course of declining market shares, insurmountable labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses. Detroit needs a turnaround, not a check." http://www.nytimes.com/2008/11/19/opinion/19romney.html ..."
"... Clinton toward the end offered tariffs. But the trump campaign hit back with what turned out to be a pretty strong counter attack – ""How's she going to get tough on China?" said Trump economic advisor Peter Navarro on CNN's Quest Means Business. He notes that some of Clinton's economic advisors have supported TPP or even worked on it. "" ..."
The question is no longer her neoliberalism, but yours. Keep it or throw it away?
I wish this issue was being seriously discussed. Neoliberalism has been disastrous for
the Rust Belt, and I think we need to envision a new future for what was once the country's industrial
heartland, now little more than its wasteland (cf. "flyover zone" – a pejorative term which
inhabitants of the zone are not too stupid to understand perfectly, btw).
The question of what the many millions of often-unionized factory workers, SMEs which supplied
them, family farmers (now fully industrialized and owned by corporations), and all those in secondary
production and services who once supported them are to actually do in future to earn a decent
living is what I believe should really be the subject of debate.
As noted upthread, two factors (or three, I guess) have contributed to this state of despair:
offshoring and outsourcing, and technology. The jobs that have been lost will not return,
and indeed will be lost in ever greater numbers – just consider what will happen to the trucking
sector when self-driving trucks hit the roads sometime in the next 10-20 years (3.5 million truckers;
8.7 in allied jobs).
Medicaid, the CHIP program, the SNAP program and others (including NGOs and private charitable
giving) may alleviate some of the suffering, but there is currently no substitute for jobs that
would enable men and women to live lives of dignity – a decent place to live, good educations
for their children, and a reasonable, secure pension in old age. Near-, at-, and below-minimum
wage jobs devoid of any benefits don't allow any of these – at most, they make possible a subsistence
life, one which requires continued reliance on public assistance throughout one's lifetime.
In the U.S. (a neoliberal pioneer), poverty is closely linked with inequality and thus,
a high GINI coefficient (near that of Turkey); where there is both poverty and a very unequal
distribution of resources, this inevitably affects women (and children) and racial (and ethnic)
minorities disproportionately. The economic system, racism, sexism, and xenophobia are not separate,
stand-alone issues; they are profoundly intertwined.
I appreciate and espouse the goals of identity politics in all their multiplicity, and also
understand that the institutions of slavery and sexism predated modern capitalist economies.
But really, if you think about it, slavery was defined as ownership, ownership of human capital
(which was convertible into cash), and women in many societies throughout history were acquired
as part of a financial transaction (either through purchase or through sale), and control of their
capital (land, property [farmland, herds], valuables and later, money) often entrusted to a spouse
or male guardian. All of these practices were economically-driven, even if the driver wasn't 21st-century
capitalism.
Also: Faustusnotes@100
For example Indiana took the ACA Medicaid expansion but did so with additional conditions that
make it worse than in neighboring states run by democratic governors.
And what states would those be? IL, IA, MI, OH, WI, KY, and TN have Republican governors. Were
you thinking pre-2014? pre-2012?
To conclude and return to my original point: what's to become of the Rust Belt in future? Did
the Democratic platform include a New New Deal for PA, OH, MI, WI, and IA (to name only the five
Rust Belt states Trump flipped)?
" Let it be said at once: Trump's victory is primarily due to the explosion in economic
and geographic inequality in the United States over several decades and the inability of successive
governments to deal with this.
Both the Clinton and the Obama administrations frequently went along with the market liberalization
launched under Reagan and both Bush presidencies. At times they even outdid them: the financial
and commercial deregulation carried out under Clinton is an example. What sealed the deal, though,
was the suspicion that the Democrats were too close to Wall Street – and the inability of the
Democratic media elite to learn the lessons from the Sanders vote. "
What should have been one comment came out as 4, so apologies on that front.
I spent the last week explaining the US election to my students in Japan in pretty much the
terms outlined by Lilla and PIketty, so I was delighted to discover these two articles.
Regional inequality and globalization are the principal drivers in Japanese politics, too,
along with a number of social drivers. It was therefore very easy to call for a show of hands
to identify students studying here in Tokyo who are trying to decide whether or not to return
to areas such as Tohoku to build their lives; or remain in Kanto/Tokyo – the NY/Washington/LA
of Japan put crudely.
I asked students from regions close to Tohoku how they might feel if the Japanese prime minister
decided not to visit the region following Fukushima after the disaster, or preceding an election.
The tsunami/nuclear meltdown combined with the Japanese government's uneven response is an
apt metaphor for the impact of neo-liberalism/globalization on Japan; and on the US. I then explained
that the income inequality in the US was far more severe than that of Japan and that many Americans
did not support the export of jobs to China/Mexico.
I then asked the students, particularly those from outlying regions whether they believe Japan
needed a leader who would 'bring back Japanese jobs' from Viet Nam and China, etc. Many/most agreed
wholeheartedly. I then asked whether they believed Tokyo people treated those outside Kanto as
'inferiors.' Many do.
Piketty may be right regarding Trump's long-term effects on income inequality. He is wrong,
I suggest, to argue that Democrats failed to respond to Sanders' support. I contend that in
some hypothetical universe the DNC and corrupt Clinton machine could have been torn out, root
and branch, within months. As I noted, however, the decision to run HRC effectively unopposed
was made several years, at least, before the stark evidence of the consequences of such a decision
appeared in sharp relief with Brexit.
Also worth noting is that the rust belts problems are as old as Reagan – even the term dates
from the 80s, the issue is so uncool that there is a dire straits song about it. Some portion
of the decline of manufacturing there is due to manufacturers shifting to the south, where the
anti Union states have an advantage. Also there has been new investment – there were no Japanese
car companies in the us in the 1980s, so they are new job creators, yet insufficient to make up
the losses. Just as the decline of Virginia coal is due to global forces and corporate stupidity,
so the decline of the rust belt is due to long (30 year plus) global forces and corporate decisions
that predate the emergence of identity politics.
It's interesting that the clear headed thinkers of the Marxist left, who pride themselves
on not being distracted by identity, don't want to talk about these factors when discussing the
plight of their cherished white working class. Suddenly it's not the forces of capital and
the objective facts of history, but a bunch of whiny black trannies demanding safe spaces and
protesting police violence, that drove those towns to ruin.
And what solutions do they think the dems should have proposed? It can't be welfare, since
we got the ACA (watered down by representatives of the rust belt states). Is it, seriously, tariffs?
Short of going to an election promising w revolution, what should the dems have done? Give us
a clear answer so we can see what the alternative to identity politics is.
basil 11.19.16 at 5:11 am
Did this go through?
Thinking with WLGR @15, Yan @81, engels variously above,
The construction 'white working class' is a useful governing tool that splits poor people
and possible coalitions against the violence of capital. Now, discussion focuses on how some of
the least powerful, most vulnerable people in the United States are the perpetrators of a great
injustice against racialised and minoritised groups. Such commentary colludes in the pathologisation
of the working class, of poor people. Victims are inculpated as the vectors of noxious, atavistic
vices while the perpetrators get off with impunity, showing off their multihued, cosmopolitan
C-suites and even proposing that their free trade agreements are a form of anti-racist solidarity.
Most crucially, such analysis ignores the continuities between a Trumpian dystopia and our satisfactory
present.
I get that the tropes around race are easy, and super-available. Privilege confessing is very
in vogue as a prophylactic against charges of racism. But does it threaten the structures that
produce this abjection – either as embittered, immiserated 'white working class' or as threatened
minority group? It is always *those* 'white' people, the South, the Working Class, and never the
accusers some of whom are themselves happy to vote for a party that drowns out anti-war protesters
with chants of USA! USA!
Race-thinking forecloses the possibility of the coalitions that you imagine, and reproduces
ideas of difference in ways that always, always privilege 'whiteness'.
--
Historical examples of ethnic groups becoming 'white', how it was legal and political decision-making
that defined the present racial taxonomy, suggest that groups can also lose or have their 'whiteness'
threatened. CB has written here about how, in the UK at least, Eastern and Southern Europeans
are racialised, and so refused 'whiteness'. JQ has written about southern white minoritisation.
Many commentators have pointed that the 'white working class' vote this year looked a lot like
a minority vote.
Given the subordination of groups presently defined as 'white working class', I wonder
if we could think beyond ethnic and epidermal definition to consider that the impossibility of
the American Dream refuses these groups whiteness; i.e the hoped for privileges of racial superiority,
much in the same way that African Americans, Latin Americans and other racialised minorities are
denied whiteness. Can a poor West Virginian living in a toxified drugged out impoverished landscape
really be defined as a carrier of 'white privilege'?
I was first pointed at this by the juxtapositions of racialised working class and immigrants
in Imogen Tyler's Revolting Subjects – Social Abjection and Resistance in Neoliberal Britain but
this below is a useful short article that takes a historical perspective.
The 'racialisation' of class in Britain has been a consequence of the weakening of 'class'
as a political idea since the 1970s – it is a new construction, not an historic one.
.
This is not to deny the existence of working-class racism, or to suggest that racism is
somehow acceptable if rooted in perceived socio-economic grievances. But it is to suggest that
the concept of a 'white working class' needs problematizing, as does the claim that the British
working-class was strongly committed to a post-war vision of 'White Britain' analogous to the
politics which sustained the idea of a 'White Australia' until the 1960s.
Yes, old, settled neighbourhoods could be profoundly distrustful of outsiders – all outsiders,
including the researchers seeking to study them – but, when it came to race, they were internally
divided. We certainly hear working-class racist voices – often echoing stock racist complaints
about over-crowding, welfare dependency or exploitative landlords and small businessmen, but
we don't hear the deep pathological racial fears laid bare in the letters sent to Enoch Powell
after his so-called 'Rivers of Blood' speech in 1968 (Whipple, 2009).
But more importantly, we also hear strong anti-racist voices loudly and clearly. At Wallsend
on Tyneside, where the researchers were gathering their data just as Powell shot to notoriety,
we find workers expressing casual racism, but we also find eloquent expressions of an internationalist,
solidaristic perspective in which, crucially, black and white are seen as sharing the same
working-class interests.
Racism is denounced as a deliberate capitalist strategy to divide workers against themselves,
weakening their ability to challenge those with power over their lives (shipbuilding had long
been a very fractious industry and its workers had plenty of experience of the dangers of internal
sectarian battles).
To be able to mobilize across across racialised divisions, to have race wither away entirely
would, for me, be the beginning of a politics that allowed humanity to deal with the inescapable
violence of climate change and corporate power.
*To add to the bibliography – David R. Roediger, Elizabeth D. Esch – The Production of Difference
– Race and the Management of Labour, and Denise Ferreira da Silva – Toward a Global Idea of Race.
And I have just been pointed at Ian Haney-López, White By Law – The Legal Construction of Race.
FWIW 'merica's constitutional democracy is going to collapse.
Some day - not tomorrow, not next year, but probably sometime before runaway climate change
forces us to seek a new life in outer-space colonies - there is going to be a collapse of the
legal and political order and its replacement by something else. If we're lucky, it won't be violent.
If we're very lucky, it will lead us to tackle the underlying problems and result in a better,
more robust, political system. If we're less lucky, well, then, something worse will happen .
In a 1990 essay, the late Yale political scientist Juan Linz observed that "aside from
the United States, only Chile has managed a century and a half of relatively undisturbed constitutional
continuity under presidential government - but Chilean democracy broke down in the 1970s."
Linz offered several reasons why presidential systems are so prone to crisis. One particularly
important one is the nature of the checks and balances system. Since both the president and the
Congress are directly elected by the people, they can both claim to speak for the people. When
they have a serious disagreement, according to Linz, "there is no democratic principle on the
basis of which it can be resolved." The constitution offers no help in these cases, he wrote:
"the mechanisms the constitution might provide are likely to prove too complicated and aridly
legalistic to be of much force in the eyes of the electorate."
In a parliamentary system, deadlocks get resolved. A prime minister who lacks the backing
of a parliamentary majority is replaced by a new one who has it. If no such majority can be found,
a new election is held and the new parliament picks a leader. It can get a little messy for a
period of weeks, but there's simply no possibility of a years-long spell in which the legislative
and executive branches glare at each other unproductively.'
Given that the basic point is polarisation (i.e. that both the President and Congress have
equally strong arguments to be the the 'voice of the people') and that under the US appalling
constitutional set up, there is no way to decide between them, one can easily imagine the so to
speak 'hyperpolarisation' of a Trump Presidency as being the straw (or anvil) that breaks the
camel's back.
In any case, as I pointed out before, given that the US is increasingly an urbanised country,
and the Electoral College was created to protect rural (slave) states, the grotesque electoral
result we have just seen is likely to recur, which means more and more Presidents with dubious
democratic legitimacy. Thanks to Bush (and Obama) these Presidents will have, at the same time,
more and more power.
nastywoman @ 150
Just study the program of the 'Sozialdemokratische Partei Deutschland' or the Program of 'Die
Grünen' in Germany (take it through google translate) and you get all the answers you are looking
for.
No need to run it through google translate, it's available in English on their site. [Or one
could refer to the Green Party of the U.S. site/platform, which is very similar in scope and overall
philosophy. (www.gp.org).]
I looked at several of their topic areas (Agricultural, Global, Health, Rural) and yes, these
are general theses I would support. But they're hardly policy/project proposals for specific regions
or communities – the Greens espouse "think global, act local", so programs and projects must be
tailored to individual communities and regions.
To return to my original question and answer it myself: I'm forced to conclude that the
Democrats did not specifically address the revitalization – rebirth of the Rust Belt in their
2016 platform. Its failure to do so carried a heavy cost that (nearly) all of us will be forced
to pay.
This sub seems to have largely fallen into the psychologically comfortable trap of declaring
that everyone who voted against their preferred candidate is racist. It's a view pushed by the
neoliberals, who want to maintain he stranglehold of identity politics over the DNC, and it makes
upper-class 'intellectuals' feel better about themselves and their betrayal of the filthy, subhuman
white underclass (or so they see it).
I expect at this point that Trump will be reelected comfortably. If not only the party itself,
but also most of its activists, refuse to actually change, it's more or less inevitable.
You can scream 'those jobs are never coming back!' all you want, but people are never going
to accept it. So either you come up with a genuine solution (instead of simply complaining that
your opponents solutions won't work; you're partisan and biased, most voters won't believe you),
you may as well resign yourself to fascism. Because whining that you don't know what to do won't
stop people from lining up behind someone who says that they do have one, whether it'll work or
not. Nobody trusts the elite enough to believe them when they say that jobs are never coming back.
Nobody trusts the elite at all.
You sound just like the Wiemar elite. No will to solve the problem, but filled with terror
at the inevitable result of failing to solve the problem.
One brutal fact tells us everything we need to know about the Democratic party in 2016:
the American Nazi party is running on a platform of free health care to working class people.
This means that the American Nazi Party is now running to the left of the Democratic party.
Folks, we have seen this before. Let's not descend in backbiting and recriminations, okay?
We've got some commenters charging that other commenters are "mansplaining," meanwhile we've got
other commenters claiming that it's economics and not racism/misogyny. It's all of the above.
Back in the 1930s, when the economy collapsed, fascists appeared and took power. Racists
also came out of the woodwork, ditto misogynists. Fast forward 80 years, and the same thing has
happened all over again. The global economy melted down in 2008 and fascists appeared promising
to fix the problems that the pols in power wouldn't because they were too closely tied to the
existing (failed) system. Along with the fascists, racists gained power because they were able
to scapegoat minorities as the alleged cause of everyone's misery.
None of this is surprising. We have seen it before. Whenever you get a depression in a
modern industrial economy, you get scapegoating, racism, and fascists. We know what to do. The
problem is that the current Democratic party isn't doing it.
Instead, what we're seeing is a whirlwind of finger-pointing from the Democratic leadership
that lost this election and probably let the entire New Deal get rolled back and wiped out. Putin
is to blame! Julian Assange is to blame! The biased media are to blame! Voter suppression is to
blame! Bernie Sanders is to blame! Jill Stein is to blame! Everyone and anyone except the current
out-of-touch influence-peddling elites who currently have run the Democratic party into the ground.
We need the feminists and the black lives matter groups and we also need the green party people
and the Bernie Sanders activists. But everyone has to understand that this is not an isolated
event. Trump did not just happen by accident. First there was Greece, then there was Brexit, then
there was Trump, next it'll be Renzi losing the referendum in Italy and a constitutional crisis
there, and after that, Marine Le Pen in France is going to win the first round of elections. (Probably
not the presidency, since all the other French parties will band together to stop her, but the
National Front is currently polling at 40% of all registered French voters.) And Marine LePen
is the real deal, a genuine full-on out-and-out fascist. Not a closet fascist like Steve Bannon,
LePen is the full monty with everything but a Hugo Boss suit and the death's heads on the cap.
Does anyone notice a pattern here?
This is an international movement. It is sweeping the world . It is the end of neoliberalism
and the start of the era of authoritarian nationalism, and we all need to come together to stamp
out the authoritarian part.
Feminists, BLM, black bloc anarchiest anti-globalists, Sandernistas, and, yes, the former Hillary
supporters. Because it not just a coincidence that all these things are happening in all these
countries at the same time. The bottom 90% of the population in the developed world has been ripped
off by a managerial and financial and political class for the last 30 years and they have all
noticed that while the world GDP was skyrocketing and international trade agreements were getting
signed with zero input from the average citizen, a few people were getting very very rich but
nobody else was getting anything.
This hammered people on the bottom, disproportionately African Americans and especially
single AA mothers in America. It crushed the blue collar workers. It is wiping out the savings
and careers of college-educated white collar workers now, at least, the ones who didn't go to
the Ivy League, which is 90% of them.
And the Democratic party is so helpless and so hopeless that it is letting the American Nazi
Party run to the left of them on health care, fer cripes sake! We are now in a situation
where the American Nazi Party is advocating single-payer nationalized health care, while the former
Democratic presidential nominee who just got defeated assured everyone that single-payer "will
never, ever happen."
C'mon! Is anyone surprised that Hillary lost? Let's cut the crap with the "Hillary
was a flawed candidate" arguments. The plain fact of the matter is that Hillary was running mainly
on getting rid of the problems she and her husband created 25 years ago. Hillary promised criminal
justice reform and Black Lives Matter-friendly policing policies - and guess who started the mass
incarceration trend and gave speeches calling black kids "superpredators" 20 years ago? Hillary
promised to fix the problems with the wretched mandate law forcing everyone to buy unaffordable
for-profit private insurance with no cost controls - and guess who originally ran for president
in 2008 on a policy of health care mandates with no cost controls? Yes, Hillary (ironically, Obama's
big surge in popularity as a candidate came when he ran against Hillary from the left, ridiculing
helath care mandates). Hillary promises to reform an out-of-control deregulated financial system
run amok - and guess who signed all those laws revoking Glass-Steagal and setting up the Securities
Trading Modernization Act? Yes, Bill Clinton, and Hillary was right there with him cheering the
whole process on.
So pardon me and lots of other folks for being less than impressed by Hillary's trustworthiness
and honesty. Run for president by promising to undo the damage you did to the country 25 years
ago is (let say) a suboptimal campaign strategy, and a distinctly suboptimal choice of presidential
candidate for a party in the same sense that the Hiroshima air defense was suboptimal in 1945.
Calling Hillary an "imperfect candidate" is like calling what happened to the Titanic a
"boating accident." Trump was an imperfect candidate. Why did he win?
Because we're back in the 1930s again, the economy has crashed hard and still hasn't recovered
(maybe because we still haven't convened a Pecora Commission and jailed a bunch of the thieves,
and we also haven't set up any alphabet government job programs like the CCC) so fascists and
racists and all kinds of other bottom-feeders are crawling out of the political woodwork to promise
to fix the problems that the Democratic party establishment won't.
Rule of thumb: any social or political or economic writer virulently hated by the current Democratic
party establishment is someone we should listen to closely right now.
Cornel West is at the top of the current Democratic establishment's hate list, and he has got
a great article in The Guardian that I think is spot-on:
"The neoliberal era in the United States ended with a neofascist bang. The political triumph
of Donald Trump shattered the establishments in the Democratic and Republican parties – both wedded
to the rule of Big Money and to the reign of meretricious politicians."
Glenn Greenwald is another writer who has been showered with more hate by the Democratic establishment
recently than even Trump or Steve Bannon, so you know Greenwald is saying something important.
He has a great piece in The Intercept on the head-in-the-ground attitude of Democratic
elites toward their recent loss:
"It is not an exaggeration to say that the Democratic Party is in shambles as a political
force. Not only did it just lose the White House to a wildly unpopular farce of a candidate despite
a virtually unified establishment behind it, and not only is it the minority party in both the
Senate and the House, but it is getting crushed at historical record rates on the state and local
levels as well. Surveying this wreckage last week, party stalwart Matthew Yglesias of Vox minced
no words: `the Obama years have created a Democratic Party that's essentially a smoking pile of
rubble.'
"One would assume that the operatives and loyalists of such a weak, defeated and wrecked
political party would be eager to engage in some introspection and self-critique, and to produce
a frank accounting of what they did wrong so as to alter their plight. In the case of 2016 Democrats,
one would be quite mistaken."
Last but far from least, Scottish economist Mark Blyth has what looks to me like the single
best analysis of the entire global Trump_vs_deep_state tidal wave in Foreign Affairs magazine:
"At the end of World War II, the United States and its allies decided that sustained mass
unemployment was an existential threat to capitalism and had to be avoided at all costs. In response,
governments everywhere targeted full employment as the master policy variable-trying to get to,
and sustain, an unemployment rate of roughly four percent. The problem with doing so, over time,
is that targeting any variable long enough undermines the value of the variable itself-a phenomenon
known as Goodhart's law. (..)
" what we see [today] is a reversal of power between creditors and debtors as the anti-inflationary
regime of the past 30 years undermines itself-what we might call "Goodhart's revenge." In this
world, yields compress and creditors fret about their earnings, demanding repayment of debt at
all costs. Macro-economically, this makes the situation worse: the debtors can't pay-but politically,
and this is crucial-it empowers debtors since they can't pay, won't pay, and still have the right
to vote.
"The traditional parties of the center-left and center-right, the builders of this anti-inflationary
order, get clobbered in such a world, since they are correctly identified by these debtors as
the political backers of those demanding repayment in an already unequal system, and all from
those with the least assets. This produces anti-creditor, pro-debtor coalitions-in-waiting that
are ripe for the picking by insurgents of the left and the right, which is exactly what has happened.
"In short, to understand the election of Donald Trump we need to listen to the trumpets blowing
everywhere in the highly indebted developed countries and the people who vote for them.
"The global revolt against elites is not just driven by revulsion and loss and racism.
It's also driven by the global economy itself. This is a global phenomenon that marks one thing
above all. The era of neoliberalism is over. The era of neonationalism has just begun."
You don't live here, do you? I'm really asking a genuine question because the way you are framing
the question ("SPECIFICS!!!!!!) suggests you don't. (Just to show my background, born and raised
in Australia (In the electoral division of Kooyong, home of Menzies) but I've lived in the US
since 2000 in the midwest (MO, OH) and currently in the south (GA))
If this election has taught us anything it's no one cared about "specifics". It was a mood,
a feeling which brought trump over the top (and I'm not talking about the "average" trump voter
because that is meaningless. The average trunp voter was a republican voter in the south who the
Dems will never get so examining their motivations is immaterial to future strategy. I'm talking
about the voters in the Upper Midwest from places which voted for Obama twice then switched to
trump this year to give him his margin of victory).
trump voters have been pretty clear they don't actually care about the way trump does (or even
doesn't) do what he said he would do during the campaign. It was important to them he showed he
was "with" people like them. They way he did that was partially racialized (law and order, islamophobia)
but also a particular emphasis on blue collar work that focused on the work. Unfortunately these
voters, however much you tell them they should suck it up and accept their generations of familial
experience as relatively highly paid industrial workers (even if it is something only their fathers
and grandfathers experienced because the factories were closing when the voters came of age in
the 80s and 90s) is never coming back and they should be happy to retrain as something else, don't
want it. They want what their families have had which is secure, paid, benefits rich, blue
collar work.
trump's campaign empathized with that feeling just by focusing on the factory jobs as jobs
and not as anachronisms that are slowly fading away for whatever reason. Clinton might have been
"correct", but these voters didn't want to hear "the truth". And as much as you can complain about
how stupid they are for wanting to be lied to, that is the unfortunate reality you, and the Democratic
party, have to accept.
The idea they don't want "government help" is ridiculous. They love the government. They just
want the government to do things for them and not for other people (which unfortunately includes
blah people but also "the coasts", "sillicon valley", etc.). Obama won in 2008 and 2012 in part
due to the auto bailout.
trump was offering a "bailout" writ large. Clinton had no (good) counteroffer. It was like
the tables were turned. Romney was the one talking about "change" and "restructuring" while Obama
was defending keeping what was already there.
"Without that bailout, Detroit will need to drastically restructure itself. With it, the
automakers will stay the course - the suicidal course of declining market shares, insurmountable
labor and retiree burdens, technology atrophy, product inferiority and never-ending job losses.
Detroit needs a turnaround, not a check." http://www.nytimes.com/2008/11/19/opinion/19romney.html
So yes. Clinton needed vague promises. She needed something more than retraining and "jobs
of the future" and "restructuring". She needed to show she was committed to their way of life,
however those voters saw it, and would do something, anything, to keep it alive. trump did that
even though his plan won't work. And maybe he'll be punished for it. In 4 years. But in the interim
the gop will destroy so many things we need and rely on as well as entrench their power for generations
through the Supreme Court.
But really, it was hard for Clinton to be trusted to act like she cared about these peoples'
way of life because she (through her husband fairly or unfairly) was associated with some of the
larger actions and choices which helped usher in the decline.
Clinton toward the end offered tariffs. But the trump campaign hit back with what turned
out to be a pretty strong counter attack – ""How's she going to get tough on China?" said Trump
economic advisor Peter Navarro on CNN's Quest Means Business. He notes that some of Clinton's
economic advisors have supported TPP or even worked on it. ""
Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make
the Rich Richer
By Dean Baker
Introduction: Trading in Myths
In winter 2016, near the peak of Bernie Sanders' bid for the Democratic presidential
nomination, a new line became popular among the nation's policy elite: Bernie Sanders is
the enemy of the world's poor. Their argument was that Sanders, by pushing trade policies
to help U.S. workers, specifically manufacturing workers, risked undermining the well-being
of the world's poor because exporting manufactured goods to the United States and other
wealthy countries is their path out of poverty. The role model was China, which by
exporting has largely eliminated extreme poverty and drastically reduced poverty among its
population. Sanders and his supporters would block the rest of the developing world from
following the same course.
This line, in its Sanders-bashing permutation, appeared early on in Vox, the
millennial-oriented media upstart, and was quickly picked up elsewhere (Beauchamp 2016).
After all, it was pretty irresistible. The ally of the downtrodden and enemy of the rich
was pushing policies that would condemn much of the world to poverty.
The story made a nice contribution to preserving the status quo, but it was less
valuable if you respect honesty in public debate.
The problem in the logic of this argument should be apparent to anyone who has taken an
introductory economics course. It assumes that the basic problem of manufacturing workers
in the developing world is the need for someone who will buy their stuff. If people in the
United States don't buy it, then the workers will be out on the street and growth in the
developing world will grind to a halt. In this story, the problem is that we don't have
enough people in the world to buy stuff. In other words, there is a shortage of demand. But
is it really true that no one else in the world would buy the stuff produced by
manufacturing workers in the developing world if they couldn't sell it to consumers in the
United States? Suppose people in the developing world bought the stuff they produced
raising their living standards by raising their own consumption.
That is how the economics is supposed to work. In the standard theory, general shortages
of demand are not a problem. Economists have traditionally assumed that economies tended
toward full employment. The basic economic constraint was a lack of supply. The problem was
that we couldn't produce enough goods and services, not that we were producing too much and
couldn't find anyone to buy them. In fact, this is why all the standard models used to
analyze trade agreements like the Trans-Pacific Partnership assume trade doesn't affect
total employment. Economies adjust so that shortages of demand are not a problem.
In this standard story (and the Sanders critics are people who care about textbook
economics), capital flows from slow-growing rich countries, where it is relatively
plentiful and so gets a low rate of return, to fast-growing poor countries, where it is
scarce and gets a high rate of return.
[Figure 1-1] Theoretical and actual capital flows.
So the United States, Japan, and the European Union should be running large trade
surpluses, which is what an outflow of capital means. Rich countries like ours should be
lending money to developing countries, providing them with the means to build up their
capital stock and infrastructure while they use their own resources to meet their people's
basic needs.
This wasn't just theory. That story accurately described much of the developing world,
especially Asia, through the 1990s. Countries like Indonesia and Malaysia were experiencing
rapid annual growth of 7.8 percent and 9.6 percent, respectively, even as they ran large
trade deficits, just over 2 percent of GDP each year in Indonesia and almost 5 percent in
Malaysia.
These trade deficits probably were excessive, and a crisis of confidence hit East Asia
and much of the developing world in the summer of 1997. The inflow of capital from rich
countries slowed or reversed, making it impossible for the developing countries to sustain
the fixed exchange rates most had at the time. One after another, they were forced to
abandon their fixed exchange rates and turn to the International Monetary Fund (IMF) for
help.
Rather than promulgating policies that would allow developing countries to continue the
textbook development path of growth driven by importing capital and running trade deficits,
the IMF made debt repayment a top priority. The bailout, under the direction of the Clinton
administration Treasury Department, required developing countries to switch to large trade
surpluses (Radelet and Sachs 2000, O'Neil 1999).
The countries of East Asia would be far richer today had they been allowed to continue
on the growth path of the early and mid-1990s, when they had large trade deficits. Four of
the five would be more than twice as rich, and the fifth, Vietnam, would be almost 50
percent richer. South Korea and Malaysia would have higher per capita incomes today than
the United States.
[Figure 1-2] Per capita income of East Asian countries, actual vs. continuing on 1990s
growth path.
In the wake of the East Asia bailout, countries throughout the developing world decided
they had to build up reserves of foreign exchange, primarily dollars, in order to avoid
ever facing the same harsh bailout terms as the countries of East Asia. Building up
reserves meant running large trade surpluses, and it is no coincidence that the U.S. trade
deficit has exploded, rising from just over 1 percent of GDP in 1996 to almost 6 percent in
2005. The rise has coincided with the loss of more than 3 million manufacturing jobs,
roughly 20 percent of employment in the sector.
There was no reason the textbook growth pattern of the 1990s could not have continued.
It wasn't the laws of economics that forced developing countries to take a different path,
it was the failed bailout and the international financial system. It would seem that the
enemy of the world's poor is not Bernie Sanders but rather the engineers of our current
globalization policies.
There is a further point in this story that is generally missed: it is not only the
volume of trade flows that is determined by policy, but also the content. A major push in
recent trade deals has been to require stronger and longer patent and copyright protection.
Paying the fees imposed by these terms, especially for prescription drugs, is a huge burden
on the developing world. Bill Clinton would have much less need to fly around the world for
the Clinton Foundation had he not inserted the TRIPS (Trade Related Aspects of Intellectual
Property Rights) provisions in the World Trade Organization (WTO) that require developing
countries to adopt U.S.-style patent protections. Generic drugs are almost always cheap -
patent protection makes drugs expensive. The cancer and hepatitis drugs that sell for tens
or hundreds of thousands of dollars a year would sell for a few hundred dollars in a free
market. Cheap drugs would be more widely available had the developed world not forced TRIPS
on the developing world.
Of course, we have to pay for the research to develop new drugs or any innovation. We
also have to compensate creative workers who produce music, movies, and books. But there
are efficient alternatives to patents and copyrights, and the efforts by the elites in the
United States and other wealthy countries to impose these relics on the developing world is
just a mechanism for redistributing income from the world's poor to Pfizer, Microsoft, and
Disney. Stronger and longer patent and copyright protection is not a necessary feature of a
21st century economy.
In textbook trade theory, if a country has a larger trade surplus on payments for
royalties and patent licensing fees, it will have a larger trade deficit in manufactured
goods and other areas. The reason is that, in theory, the trade balance is fixed by
national savings and investment, not by the ability of a country to export in a particular
area. If the trade deficit is effectively fixed by these macroeconomic factors, then more
exports in one area mean fewer exports in other areas. Put another way, income gains for
Pfizer and Disney translate into lost jobs for workers in the steel and auto industries....
It includes this interesting piece on international trade:
"I'll start with my favorite, the complaint that the trade policy advocating by Warren
and Sanders would hurt the poor in the developing world, or to use their words:
"And their ostensible protection of American workers leaves no room to consider the welfare
of poor people elsewhere in the world."
I like this one because it turns standard economic theory on its head to advance the
interests of the rich and powerful. In the economic textbooks, rich countries like the
United States are supposed to be exporting capital to the developing world. This provides
them the means to build up their capital stock and infrastructure, while maintaining the
living standards of their populations. This is the standard economic story where the
problem is scarcity.
But to justify trade policies that have harmed tens of millions of U.S. workers, either
by costing them jobs or depressing their wages, the Post discards standard economics and
tells us the problem facing people in the developing world is that there is too much stuff.
If we didn't buy the goods produced in the developing world then there would just be a
massive glut of unsold products.
In the standard theory the people in the developing world buy their own stuff, with rich
countries like the U.S. providing the financing. It actually did work this way in the
1990s, up until the East Asian financial crisis in 1997. In that period, countries like
Malaysia, Vietnam, and Indonesia were growing very rapidly while running large trade
deficits. This pattern of growth was ended by the terms of the bailout imposed on these
countries by the U.S. Treasury Department through the International Monetary Fund.
The harsh terms of the bailout forced these and other developing countries to reverse
the standard textbook path and start running large trade surpluses. This post-bailout
period was associated with slower growth for these countries. In other words, the poor of
the developing world suffered from the pattern of trade the Post advocates. If they had
continued on the pre-bailout path they would be much richer today. In fact, South Korea and
Malaysia would be richer than the United States if they had maintained their pre-bailout
growth rate over the last two decades. (This is the topic of the introduction to my new
book, Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make
the Rich Richer, it's free.)"
Not sure that I fully agree with him, but I do agree that trade imbalances and
mercantilism is a large part of the problem.
The Washington Post editorial page decided to lecture readers * on the meaning of
progressivism. Okay, that is nowhere near as bad as a Trump presidency, but really, did we
need this?
The editorial gives us a potpourri of neo-liberal (yes, the term is appropriate here)
platitudes, all of which we have heard many times before and are best half true. For
framing, the villains are Bernie Sanders and Elizabeth Warren who it tells us "are
embracing principles that are not genuinely progressive."
I'll start with my favorite, the complaint that the trade policy advocating by Warren
and Sanders would hurt the poor in the developing world, or to use their words:
"And their ostensible protection of American workers leaves no room to consider the
welfare of poor people elsewhere in the world."
I like this one because it turns standard economic theory on its head to advance the
interests of the rich and powerful. In the economic textbooks, rich countries like the
United States are supposed to be exporting capital to the developing world. This provides
them the means to build up their capital stock and infrastructure, while maintaining the
living standards of their populations. This is the standard economic story where the
problem is scarcity.
But to justify trade policies that have harmed tens of millions of U.S. workers, either
by costing them jobs or depressing their wages, the Post discards standard economics and
tells us the problem facing people in the developing world is that there is too much stuff.
If we didn't buy the goods produced in the developing world then there would just be a
massive glut of unsold products.
In the standard theory the people in the developing world buy their own stuff, with rich
countries like the U.S. providing the financing. It actually did work this way in the
1990s, up until the East Asian financial crisis in 1997. In that period, countries like
Malaysia, Vietnam, and Indonesia were growing very rapidly while running large trade
deficits. This pattern of growth was ended by the terms of the bailout imposed on these
countries by the U.S. Treasury Department through the International Monetary Fund.
The harsh terms of the bailout forced these and other developing countries to reverse
the standard textbook path and start running large trade surpluses. This post-bailout
period was associated with slower growth for these countries. In other words, the poor of
the developing world suffered from the pattern of trade the Post advocates. If they had
continued on the pre-bailout path they would be much richer today. In fact, South Korea and
Malaysia would be richer than the United States if they had maintained their pre-bailout
growth rate over the last two decades. (This is the topic of the introduction to my new
book, "Rigged: How Globalization and the Rules of the Modern Economy Were Structured to
Make the Rich Richer," ** it's free.)
It is also important to note that the Post is only bothered by forms of protection that
might help working class people. The United States prohibits foreign doctors from
practicing in the United States unless they complete a U.S. residency program. (The total
number of slots are tightly restricted with only a small fraction open to foreign trained
doctors.) This is a classic protectionist measure. No serious person can believe that the
only way for a person to be a competent doctor is to complete a U.S. residency program. It
costs the United States around $100 billion a year ($700 per family) in higher medical
expenses. Yet, we never hear a word about this or other barriers that protect the most
highly paid professionals from the same sort of international competition faced by
steelworkers and textile workers.
Moving on, we get yet another Post tirade on Social Security.
"You can expand benefits for everyone, as Ms. Warren favors. Prosperous retirees who
live mostly off their well-padded 401(k)s will appreciate what to them will feel like a
small bonus, if they notice it. But spreading wealth that way will make it harder to find
the resources for the vulnerable elderly who truly depend on Social Security.
"But demographics - the aging of the population - cannot be wished away. In the 1960s,
about five taxpayers were helping to support each Social Security recipient, and the
economy was growing about 6 percent annually. Today there are fewer than three workers for
each pensioner, and the growth rate even following the 2008 recession has averaged about 2
percent . On current trends, 10 years from now the federal government will be spending
almost all its money on Medicare, Social Security and other entitlements and on interest
payments on the debt, leaving less and less for schools, housing and job training. There is
nothing progressive about that."
There are all sorts of misleading or wrong claims here. First, the economy did not grow
"about 6 percent annually" in the 1960s. There were three years in which growth did exceed
6.0 percent, and it was a very prosperous decade, but growth only averaged 4.6 percent from
1960 to 1970.
I suppose we should be happy that the Post is at least getting closer to the mark. A
2007 editorial *** praising The North American Free Trade Agreement told readers that
Mexico's GDP "has more than quadrupled since 1987." The International Monetary Fund data
**** put the gain at 83 percent. So by comparison, they are doing pretty good with the 6
percent growth number for the sixties.
But getting to the demographics, we did go from more than five workers for every retiree
to less than three today, and this number is projected to fall further to around 2.0
workers per retiree in the next fifteen years. This raises the obvious question, so what?
The economy did not collapse even as we saw the fall from 5 workers per retiree to less
than 3, so something really really bad happens when it falls further? We did raise taxes to
cover the additional cost and we will probably have to raise taxes in the future.
We get that the Post doesn't like tax increases (no one does), but this hardly seems
like the end of the world. The Social Security Trustees project ***** that real wages will
rise on average by more than 34 percent over the next two decades. Suppose we took back
5–10 percent of these projected wage gains through tax increases (still leaving workers
with wages that are more than 30 percent higher than they are today), what is the big
problem?
Of course most workers have not seen their wages rise in step with the economy's growth
over the last four decades. This is a huge issue which is the sort of thing that
progressives should be and are focusing on. But the Post would rather distract us with the
possibility that at some point in the future we may be paying a somewhat higher Social
Security tax.
The Post's route for savings is also classic misdirection. It tells how about
high-living seniors who get so much money from their 401(k)s they don't even notice their
Social Security checks. Only a bit more than 4.0 percent of the over 65 population has
non-Social Security income of more than $80,000 a year. If the point is to have substantial
savings from means-testing it would be necessary to hit people with incomes around $40,000
a year or even lower. That is not what most people consider wealthy.
We could have substantial savings on Medicare by pushing down the pay of doctors and
reducing the prices of drugs and medical equipment. The latter could be done by
substituting public financing for research and development for government granted patent
monopolies (also discussed in Rigged). These items would almost invariably be cheap in a
free market. But the Post seems uninterested in ways to save money that could affect the
incomes of the rich.
One can quibble with whether the current benefits for middle income people are right or
should be somewhat higher or lower, but it is ridiculous to argue that raising them $50 a
month, as proposed by Senator Warren, will break the bank.
Then we have the issue of free college. The Post raises the issue, pushed by Senator
Sanders in his presidential campaign, and then tells readers:
"Our answer - we would argue, the progressive answer - is that there are people in
society with far greater needs than that upper-middle-class family in Fairfax County that
would be relieved of its tuition burden at the College of William & Mary if Mr. Sanders got
his wish."
There are two points to be made here. First there is extensive research ****** showing
that many children from low- and moderate-income families hugely over-estimate the cost of
college, failing to realize that they would be eligible for financial aid that would make
it free or nearly free. This means that the current structure is preventing many relatively
disadvantaged children from attending college. Arguably better education on the
opportunities to get aid would solve this problem, but the problem has existed for a long
time and better education has not done much to change the picture thus far.
The second point is that the process of determining eligibility for aid is itself
costly. Many children have divorced parents, with a non-custodial parent often not anxious
to pay for their children's college. Perhaps it is appropriate that they should pay, but
forcing payment is not an easy task and it doesn't make sense to make the children in such
situations suffer.
In many ways, the free college solution is likely to be the easiest, with the tax coming
out of the income of higher earners, the vast majority of whom will be the beneficiaries of
this policy. There are ways to save on paying for college. My favorite is limiting the pay
of anyone at a public school to the salary of the president of the United States ($400,000
a year). We can also deny the privilege of tax exempt status to private universities or
other non-profits that don't accept a similar salary cap. These folks can pay their top
executives whatever they want, but they shouldn't ask the taxpayers to subsidize their
exorbitant pay packages.
There is one final issue in the column worth noting. At one point it makes a pitch for
the virtues of economic growth then tells readers:
"It's not in conflict with the goal of redistribution."
At least some of us progressive types are not particularly focused on "redistribution."
The focus of my book and much of my other writing is on the way that the market has been
structured to redistribute income upward, compared with the structures in place in the
quarter century after World War II. Is understandable that people who are basically very
satisfied with this upward redistribution of market income would not want this rigging of
the market even to be discussed, but serious progressives do.
Although I like much of what
Dean Baker, I don't like his term "loser liberalism", nor do I think his de-emphasis on
redistribution useful. Au contraire, I think talking about redistribution is absolutely
essential if we are to move to sustainable world. We can no longer be certain that per
person GDP growth will be sufficient to be able to ignore distribution or to rely on
"predistribution".
The End of Loser Liberalism: Making Markets Progressive
By Dean Baker
Upward Redistribution of Income: It Didn't Just Happen
Money does not fall up. Yet the United States has experienced a massive upward
redistribution of income over the last three decades, leaving the bulk of the workforce
with little to show from the economic growth since 1980. This upward redistribution was not
the result of the natural workings of the market. Rather, it was the result of deliberate
policy, most of which had the support of the leadership of both the Republican and
Democratic parties.
Unfortunately, the public and even experienced progressive political figures are not
well informed about the key policies responsible for this upward redistribution, even
though they are not exactly secrets. The policies are so well established as conventional
economic policy that we tend to think of them as incontrovertibly virtuous things, but each
has a dark side. An anti-inflation policy by the Federal Reserve Board, which relies on
high interest rates, slows growth and throws people out of work. Major trade deals hurt
manufacturing workers by putting them in direct competition with low-paid workers in the
developing world. A high dollar makes U.S. goods uncompetitive in world markets.
Almost any economist would acknowledge these facts, but few economists have explored
their implications and explained them to the general public. As a result, most of us have
little understanding of the economic policies that have the largest impact on our jobs, our
homes, and our lives. Instead, public debate and the most hotly contested legislation in
Congress tend to be about issues that will have relatively little impact.
This lack of focus on crucial economic issues is a serious problem from the standpoint
of advancing a progressive agenda....
President Barack Obama said Wednesday that America's election of Donald Trump and the U.K.'s
vote to leave the European Union reflect a political uprising in the West over economic
inequities spawned by leaders' mishandling of globalization.
"... Already, motor-vehicle manufacturers ship an automotive transmission back and forth across the US-Mexican border several times in the course of production. At some point, unpacking that production process still further will reach the point of diminishing returns. ..."
"... The story for cross-border flows of financial capital is even more dramatic. Gross capital flows – the sum of inflows and outflows – are not just growing more slowly; they are down significantly in absolute terms from 2009 levels. ..."
"... ... cross-border bank lending and borrowing that have fallen. Foreign direct investment – financial flows to build foreign factories and acquire foreign companies – remains at pre-crisis levels. ..."
"... This difference reflects regulation. Having concluded, rightly, that cross-border bank lending is especially risky, regulators clamped down on banks' international operations. ..."
Does Donald Trump's election as United States president mean that globalization is dead, or are
reports of the process' demise greatly exaggerated? If globalization is only partly incapacitated,
not terminally ill, should we worry? How much will slower trade growth, now in the offing, matter
for the global economy?
World trade growth would be slowing down, even without Trump in office. Its growth was already
flat in the first quarter of 2016, and it fell
by nearly 1% in the second quarter. This continues a prior trend: since 2010, global trade has
grown at an annual rate of barely 2%. Together with the fact that worldwide production of goods and
services has been rising by more than 3%, this means that the trade-to-GDP ratio has been falling,
in contrast to its steady upward march in earlier years.
... the resurgent protectionism manifest in popular opposition to the Trans-Pacific Partnership
(TPP) and the Transatlantic Trade and Investment Partnership (TTIP),
Causality in economics may be elusive, but in this case it is clear. So far, slower trade growth
has been the result of slower GDP growth, not the other way around.
This is particularly evident in the case of investment spending, which has
fallen sharply since
the global financial crisis. Investment spending is trade-intensive, because countries rely disproportionately
on a relatively small handful of producers, like Germany, for technologically sophisticated capital
goods.
In addition, slower trade growth reflects China's economic deceleration. Until 2011 China was
growing at double-digit rates, and Chinese exports and imports were growing even faster. China's
growth has now slowed by a third, leading to slower growth of Chinese trade.
China's growth miracle, benefiting a fifth of the earth's population, is the most important economic
event of the last quarter-century. But it can happen only once. And now that the phase of catch-up
growth is over for China, this engine of global trade will slow.
The other engine of world trade has been global supply chains. Trade in parts and components has
benefited from falling transport costs, reflecting containerization and related advances in logistics.
But efficiency in shipping is unlikely to continue to improve faster than efficiency in the production
of what is being shipped. Already, motor-vehicle manufacturers ship an automotive transmission
back and forth across the US-Mexican border several times in the course of production. At some point,
unpacking that production process still further will reach the point of diminishing returns.
The story for cross-border flows of financial capital is even more dramatic. Gross capital
flows – the sum of inflows and outflows – are not just growing more slowly; they are down significantly
in absolute terms from 2009 levels.
... cross-border bank lending and borrowing that have fallen. Foreign direct investment –
financial flows to build foreign factories and acquire foreign companies – remains at pre-crisis
levels.
This difference reflects regulation. Having concluded, rightly, that cross-border bank lending
is especially risky, regulators clamped down on banks' international operations.
In response, many banks curtailed their cross-border business. But, rather than alarming anyone,
this should be seen as reassuring, because the riskiest forms of international finance have been
curtailed without disrupting more stable and productive forms of foreign investment.
We now face the prospect of the US government revoking the Dodd-Frank Act and rolling back the
financial reforms of recent years. Less stringent financial regulation may make for the recovery
of international capital flows. But we should be careful what we wish for.
"... The New Deal did not seek to overthrow the plutocracy, but it did seek to side-step and disable
their dominance. ..."
"... It seems to me that while neoliberalism on the right was much the same old same old, the neoliberal
turn on the left was marked by a measured abandonment of this struggle over the distribution of income
between the classes. In the U.S., the Democrats gradually abandoned their populist commitments. In Europe,
the labour and socialist parties gradually abandoned class struggle. ..."
"... When Obama came in, in 2008 amid the unfolding GFC, one of the most remarkable features of
his economic team was the extent to which it conceded control of policy entirely to the leading money
center banks. Geithner and Bernanke continued in power with Geithner moving from the New York Federal
Reserve (where he served as I recall under a Chair from Goldman Sachs) to Treasury in the Obama Administration,
but Geithner's Treasury was staffed from Goldman Sachs, JP Morgan Chase and Citibank. The crisis served
to concentrate banking assets in the hands of the top five banks, but it seemed also to transfer political
power entirely into their hands as well. Simon Johnson called it a coup. ..."
"... Here's the thing: the globalization and financialization of the economy from roughly 1980 drove
both increasingly extreme distribution of income and de-industrialization. ..."
"... It was characteristic of neoliberalism that the policy, policy intention and policy consequences
were hidden behind a rhetoric of markets and technological inevitability. Matt Stoller has identified
this as the statecraft of neoliberalism: the elimination of political agency and responsibility for
economic performance and outcomes. Globalization and financialization were just "forces" that just happened,
in a meteorological economics. ..."
"... This was not your grandfather's Democratic Party and it was a Democratic Party that could aid
the working class and the Rust Belt only within fairly severe and sometimes sharply conflicting constraints.
..."
"... No one in the Democratic Party had much institutional incentive to connect the dots, and draw
attention to the acute conflicts over the distribution of income and wealth involved in financialization
of the economy (including financialization as a driver of health care costs). And, that makes the political
problem that much harder, because there are no resources for rhetorical and informational clarity or
coherence. ..."
"... If Obama could not get a very big stimulus indeed thru a Democratic Congress long out of power,
Obama wasn't really trying. And, well-chosen spending on pork barrel projects is popular and gets Congressional
critters re-elected. So, again, if the stimulus is small and the Democratic Congress doesn't get re-elected,
Obama isn't really trying. ..."
"... Again, it comes down to: by 2008, the Democratic Party is not a fit vehicle for populism, because
it has become a neoliberal vehicle for giant banks. Turns out that makes a policy difference. ..."
At the center of Great Depression politics was a political struggle over the distribution of
income, a struggle that was only decisively resolved during the War, by the Great Compression.
It was at center of farm policy where policymakers struggled to find ways to support farm incomes.
It was at the center of industrial relations politics, where rapidly expanding unions were seeking
higher industrial wages. It was at the center of banking policy, where predatory financial practices
were under attack. It was at the center of efforts to regulate electric utility rates and establish
public power projects. And, everywhere, the clear subtext was a struggle between rich and poor,
the economic royalists as FDR once called them and everyone else.
FDR, an unmistakeable patrician in manner and pedigree, was leading a not-quite-revolutionary
politics, which was nevertheless hostile to and suspicious of business elites, as a source of
economic pathology. The New Deal did not seek to overthrow the plutocracy, but it did seek
to side-step and disable their dominance.
It seems to me that while neoliberalism on the right was much the same old same old, the
neoliberal turn on the left was marked by a measured abandonment of this struggle over the distribution
of income between the classes. In the U.S., the Democrats gradually abandoned their populist commitments.
In Europe, the labour and socialist parties gradually abandoned class struggle.
In retrospect, though the New Deal did use direct employment as a means of relief to good effect
economically and politically, it never undertook anything like a Keynesian stimulus on a Keynesian
scale - at least until the War.
Where the New Deal witnessed the institution of an elaborate system of financial repression,
accomplished in large part by imposing on the financial sector an explicitly mandated structure,
with types of firms and effective limits on firm size and scope, a series of regulatory reforms
and financial crises beginning with Carter and Reagan served to wipe this structure away.
When Obama came in, in 2008 amid the unfolding GFC, one of the most remarkable features
of his economic team was the extent to which it conceded control of policy entirely to the leading
money center banks. Geithner and Bernanke continued in power with Geithner moving from the New
York Federal Reserve (where he served as I recall under a Chair from Goldman Sachs) to Treasury
in the Obama Administration, but Geithner's Treasury was staffed from Goldman Sachs, JP Morgan
Chase and Citibank. The crisis served to concentrate banking assets in the hands of the top five
banks, but it seemed also to transfer political power entirely into their hands as well. Simon
Johnson called it a coup.
I don't know what considerations guided Obama in choosing the size of the stimulus or its composition
(as spending and tax cuts). Larry Summers was identified at the time as a voice of caution, not
"gambling", but not much is known about his detailed reasoning in severely trimming Christina
Romer's entirely conventional calculations. (One consideration might well have been worldwide
resource shortages, which had made themselves felt in 2007-8 as an inflationary spike in commodity
prices.) I do not see a case for connecting stimulus size policy to the health care reform. At
the time the stimulus was proposed, the Administration had also been considering whether various
big banks and other financial institutions should be nationalized, forced to insolvency or otherwise
restructured as part of a regulatory reform.
Here's the thing: the globalization and financialization of the economy from roughly 1980
drove both increasingly extreme distribution of income and de-industrialization. Accelerating
the financialization of the economy from 1999 on made New York and Washington rich, but the same
economic policies and process were devastating the Rust Belt as de-industrialization. They were
two aspects of the same complex of economic trends and policies. The rise of China as a manufacturing
center was, in critical respects, a financial operation within the context of globalized trade
that made investment in new manufacturing plant in China, as part of globalized supply chains
and global brand management, (arguably artificially) low-risk and high-profit, while reinvestment
in manufacturing in the American mid-west became unattractive, except as a game of extracting
tax subsidies or ripping off workers.
It was characteristic of neoliberalism that the policy, policy intention and policy consequences
were hidden behind a rhetoric of markets and technological inevitability. Matt Stoller has identified
this as the statecraft of neoliberalism: the elimination of political agency and responsibility
for economic performance and outcomes. Globalization and financialization were just "forces" that
just happened, in a meteorological economics.
It is conceding too many good intentions to the Obama Administration to tie an inadequate stimulus
to a Rube Goldberg health care reform as the origin story for the final debacle of Democratic
neoliberal politics. There was a delicate balancing act going on, but they were not balancing
the recovery of the economy in general so much as they were balancing the recovery from insolvency
of a highly inefficient and arguably predatory financial sector, which was also not incidentally
financing the institutional core of the Democratic Party and staffing many key positions in the
Administration and in the regulatory apparatus.
This was not your grandfather's Democratic Party and it was a Democratic Party that could
aid the working class and the Rust Belt only within fairly severe and sometimes sharply conflicting
constraints.
No one in the Democratic Party had much institutional incentive to connect the dots, and
draw attention to the acute conflicts over the distribution of income and wealth involved in financialization
of the economy (including financialization as a driver of health care costs). And, that makes
the political problem that much harder, because there are no resources for rhetorical and informational
clarity or coherence.
The short version of my thinking on the Obama stimulus is this: Keynesian stimulus spending is
a free lunch; it doesn't really matter what you spend money on up to a very generous point, so
it seems ready-made for legislative log-rolling. If Obama could not get a very big stimulus
indeed thru a Democratic Congress long out of power, Obama wasn't really trying. And, well-chosen
spending on pork barrel projects is popular and gets Congressional critters re-elected. So, again,
if the stimulus is small and the Democratic Congress doesn't get re-elected, Obama isn't really
trying.
Again, it comes down to: by 2008, the Democratic Party is not a fit vehicle for populism,
because it has become a neoliberal vehicle for giant banks. Turns out that makes a policy difference.
Great comment. Simply great. Hat tip to the author !
Notable quotes:
"… The New Deal did not seek to overthrow the plutocracy, but it did seek to side-step and
disable their dominance. …"
"… It seems to me that while neoliberalism on the right was much the same old same old, the
neoliberal turn on the left was marked by a measured abandonment of this struggle over the distribution
of income between the classes. In the U.S., the Democrats gradually abandoned their populist
commitments. In Europe, the labour and socialist parties gradually abandoned class struggle. …"
"… When Obama came in, in 2008 amid the unfolding GFC, one of the most remarkable features
of his economic team was the extent to which it conceded control of policy entirely to the leading
money center banks. Geithner and Bernanke continued in power with Geithner moving from the
New York Federal Reserve (where he served as I recall under a Chair from Goldman Sachs) to Treasury
in the Obama Administration, but Geithner's Treasury was staffed from Goldman Sachs, JP Morgan
Chase and Citibank. The crisis served to concentrate banking assets in the hands of the top
five banks, but it seemed also to transfer political power entirely into their hands as well.
Simon Johnson called it a coup. … "
"… Here's the thing: the globalization and financialization of the economy from roughly 1980
drove both increasingly extreme distribution of income and de-industrialization. …"
"… It was characteristic of neoliberalism that the policy, policy intention and policy consequences
were hidden behind a rhetoric of markets and technological inevitability. Matt Stoller has identified
this as the statecraft of neoliberalism: the elimination of political agency and responsibility
for economic performance and outcomes. Globalization and financialization were just "forces"
that just happened, in a meteorological economics. …"
"… This was not your grandfather's Democratic Party and it was a Democratic Party that could
aid the working class and the Rust Belt only within fairly severe and sometimes sharply conflicting
constraints. …"
"… No one in the Democratic Party had much institutional incentive to connect the dots, and
draw attention to the acute conflicts over the distribution of income and wealth involved in financialization
of the economy (including financialization as a driver of health care costs). And, that makes
the political problem that much harder, because there are no resources for rhetorical and informational
clarity or coherence. …"
"… If Obama could not get a very big stimulus indeed thru a Democratic Congress long out of
power, Obama wasn't really trying. And, well-chosen spending on pork barrel projects is popular
and gets Congressional critters re-elected. So, again, if the stimulus is small and the Democratic
Congress doesn't get re-elected, Obama isn't really trying. …"
"… Again, it comes down to: by 2008, the Democratic Party is not a fit vehicle for populism,
because it has become a neoliberal vehicle for giant banks. Turns out that makes a policy difference.
…"
"... What Is Lost by Burying the Trans-Pacific Partnership? – The New York Times : "The Americans will have to explain their failure on the trade agreement to foreign leaders gathered in Lima, Peru, while China's leader, Xi Jinping, is there seeking progress toward an emerging alternative to the Trans-Pacific Partnership - the Regional Comprehensive Economic Partnership, known as R.C.E.P., which includes China, Japan and 14 other Asian countries but excludes the United States. ..."
"... 'In the absence of T.P.P., countries have already made it clear that they will move forward in negotiating their own trade agreements that exclude the United States,' Mr. Obama's Council of Economic Advisers wrote days before the election. 'These agreements would improve market access and trading opportunities for member countries while U.S. businesses would continue to face existing trade barriers.'" ..."
"... Foreign leaders and foreign populations hated the TPP because it wasn't a trade deal; it was a giveaways-to-big-corporations deal full of stuff about extending copyrights for Mickey Mouse and so on. ..."
I don't know enough about the finer points of the TPP to be for or against it.
But this article suggests that there are plans to exclude the US if it doesn't choose to be
a factor in world affairs.
What Is Lost by Burying the Trans-Pacific Partnership? – The New York Times : "The Americans
will have to explain their failure on the trade agreement to foreign leaders gathered in Lima,
Peru, while China's leader, Xi Jinping, is there seeking progress toward an emerging alternative
to the Trans-Pacific Partnership - the Regional Comprehensive Economic Partnership, known as R.C.E.P.,
which includes China, Japan and 14 other Asian countries but excludes the United States.
'In the absence of T.P.P., countries have already made it clear that they will move forward
in negotiating their own trade agreements that exclude the United States,' Mr. Obama's Council
of Economic Advisers wrote days before the election. 'These agreements would improve market access
and trading opportunities for member countries while U.S. businesses would continue to face existing
trade barriers.'"
Foreign leaders and foreign populations hated the TPP because it wasn't a trade deal; it was a
giveaways-to-big-corporations deal full of stuff about extending copyrights for Mickey Mouse and
so on.
China's trade deal is an *actual* trade deal and as such much more popular. We could join *it*.
"... The affluent and rich voted for Clinton by a much broader margin than they had voted for the Democratic candidate in 2012. Among those with incomes between $100,000 and $200,000, Clinton benefited from a 9-point Democratic swing. Voters with family incomes above $250,000 swung toward Clinton by 11 percentage points. The number of Democratic voters amongst the wealthiest voting block increased from 2.16 million in 2012 to 3.46 million in 2016-a jump of 60 percent. ..."
"... Clinton's electoral defeat is bound up with the nature of the Democratic Party, an alliance of Wall Street and the military-intelligence apparatus with privileged sections of the upper-middle class based on the politics of race, gender and sexual orientation ..."
"... Over the course of the last forty years, the Democratic Party has abandoned all pretenses of social reform, a process escalated under Obama. Working with the Republican Party and the trade unions, it is responsible for enacting social policies that have impoverished vast sections of the working class, regardless of race or gender. ..."
The elections saw a massive shift in party support among the poorest and wealthiest voters. The share
of votes for the Republicans amongst the most impoverished section of workers, those with family
incomes under $30,000, increased by 10 percentage points from 2012. In several key Midwestern states,
the swing of the poorest voters toward Trump was even larger: Wisconsin (17-point swing), Iowa (20
points), Indiana (19 points) and Pennsylvania (18 points).
The swing to Republicans among the $30,000 to $50,000 family income range was 6 percentage points.
Those with incomes between $50,000 and $100,000 swung away from the Republicans compared to 2012
by 2 points.
The affluent and rich voted for Clinton by a much broader margin than they had voted for the
Democratic candidate in 2012. Among those with incomes between $100,000 and $200,000, Clinton benefited
from a 9-point Democratic swing. Voters with family incomes above $250,000 swung toward Clinton by
11 percentage points. The number of Democratic voters amongst the wealthiest voting block increased
from 2.16 million in 2012 to 3.46 million in 2016-a jump of 60 percent.
Clinton was unable to make up for the vote decline among women (2.1 million), African Americans
(3.2 million), and youth (1.2 million), who came overwhelmingly from the poor and working class,
with the increase among the rich (1.3 million).
Clinton's electoral defeat is bound up with the nature of the Democratic Party, an alliance
of Wall Street and the military-intelligence apparatus with privileged sections of the upper-middle
class based on the politics of race, gender and sexual orientation.
Over the course of the last forty years, the Democratic Party has abandoned all pretenses
of social reform, a process escalated under Obama. Working with the Republican Party and the trade
unions, it is responsible for enacting social policies that have impoverished vast sections of the
working class, regardless of race or gender.
They are afraid to call neoliberalism with it proper name and inverted alternative label "liberal
progressivism" instead. The content makes more sense if you substitute a proper term, which is done below.
Notable quotes:
"... In Great Britain it's all the fault of the guys who sold Range Rover and Jaguar to some Indians – and the Mini, Bentley and even Rolls Royce to the Germans – and instead of keeping on building stuff we all became either Bankers or Real Estate Agents – with the exceptions of everybody who doesn't have a job – or has a job he no like or get's payed bad. ..."
"... And do you know that there is this old American Indian saying that you can't eat money? ..."
"... The strategy for the 40 year-period since the final gasps of formal imperialism has been to use the military only just enough to ensure a playing field on which the educated elite can press their advantage. And of course use the educated elite to develop better weapons. ..."
"... Trump_vs_deep_state increasingly sounds like a viable strategy; start more and bigger wars so that valor is favored over cleverness. Win those wars, and take tribute from the defeated, instead of paying to rebuild them. If you change a regime, change it to a dictatorship; only a dictator can pay tribute. ..."
"... this has been posted on other threads, but to get a sense of the scale of the problem, have a look at this: https://www.youtube.com/watch?v=VWMmBG3Z4DI ignoring of course everything that Wendy Schiller has to say ..."
"... What we are faced with here is a fundamental revolt against all 'neoliberal' trans-national organisations and entities: indeed against globalisation itself, which is why I suspect that in the long run Trump is simply waking up and smelling the coffee when he hints that the EU and Nato have no future (in the very long term the UN itself might be doomed). ..."
"... But apart from these outliers, as Owen Jones argued recently, for most European countries the future might be Poland, where the left has simply ceased to exist and all elected parties are right wing. ..."
"... The story isn't the 1% (well, it is, but not solely) but probably the top 10% (not only in income but educational attainment). ..."
"... I hope the [neo]liberal order survives and is improved, but, tbh, at this stage liberals (for a broad definition) need to start thinking seriously about how they're going to make it work for more people. And if they can't, but continue to get bogged down in the trivial nonsense that makes up so much of liberal politics these days (not personalising this to the OP or anyone here, but in general about contemporary politics) then they deserve to lose. ..."
"... Their reputations as liberals rests mostly on supporting social justice issues. I do not mean to minimize the importance of social justice but for these senators it carries no cost or risk. But when it comes to issues of income inequality, foreign policy (remember those defense contractors), substantive action on climate change or single-payer health care they are nowhere to be found. They will fight on trade issues, both being supporters of TPP, validating the view that they don't care about people working outside of liberal enclaves. ..."
"... The illiberal reality of periods of supposedly liberal governance are, then, quite beside the point. It is about "neoliberalism" (admittedly as wooly a term as they come) as a political narrative, project and agenda-this has fallen apart. ..."
"... [Neo]Liberal politics descended into moralism-smug condescension-instead of addressing people's fears at their root. ..."
The other day,
an article
by Chris Deerin , a writer for the Scottish Daily Mail, appeared on my twitter timeline, retweeted
and endorsed by several people I respect. The article argued Trump and Brexit mean that "neoliberalism"
have lost and that "the model that has more or less dominated Western politics for the past three
decades is defunct. It could not be more dead." "We" misused that hegemony and are responsible for
our own downfall:
We used our hegemony to take down barriers and borders, to connect and build, to (yes) line
our own pockets and smugly luxuriate in the goodness of our ideas and intentions. Meantime, we
forgot about those who weren't able to take part, who weren't benefiting, to whom free trade and
open borders meant greater hardship and uneasy cultural compromises. Or, let's be honest, we didn't
forget – we just chose to conveniently ignore. We stopped asking for their permission, ploughed
on through the warning signs, and fell off the end of the road.
Now "liberal" is a funny old word, mostly used as an insult these days by the Jacobin crowd on
the one hand and conservatives on the other. Still, I can't help but feel that my politics is being
condemned here as infeasible and dead whilst wondering whether it is in fact true that I've enjoyed
such "hegemony" for the past 30 years, because that certainly doesn't gel with my experience. To
get pedantic about it, 30 years takes us back to 1986. Mrs Thatcher was still in power in the UK
and her most illiberal single measure, Section 28 of the Local Government Act 1988 was still in the
future, outlawing British local authorities from "promoting" homosexuality. In the United States,
Ronald Reagan still had a few years to go, and would then be replaced by former CIA Director George
H.W. Bush. So whenever this neoliberal hegemony started, it was considerably more recently. Presumably,
in the US it starts with Bill Clinton - a man not without his illiberal side - but then gets interrupted
by George W. Bush, whose neoliberalism included Guantanamo and waterboarding, before "normal service'
got re-established by Barack Obama. In the UK, you could make a plausible case that some kind of
"neoliberalism" took power with Tony Blair in 1997 and then ran on all the way to 2010, though the
use of the word "liberal" to describe the attitudes and policies of successive Labour Home Secretaries
such as Straw, Blunkett, Clarke and Reid would be curious. In the United States, the past 30 years
has seen a massive expansion of the prison population, hardly the mark of neoliberalism
Since the article specifically identifies immigration as one of the areas of neoliberal triumph
during this period, it might be worth directing some attention there. Whilst the opening of the UK
to migration from new accession EU countries is a big element that supports the claim, pretty much
everything else in UK policy in the area does not. As the
Migration Observatory reported recently , British immigration law added 89 new types of immigration
offences from 1999 to 2016, compared with only 70 that were introduced between 1905 and 1998. There
was a massive increase in immigration detention in the UK over the same period and in recent years
a series of moral panics about "foreign criminals" that have led to a serious erosion of the rule
of law for some sections of society. Citizenship deprivation has become much more common, and is
now used to punish not only those taking up arms against the state but also some criminals. A tightening
of the spousal visa regime in the UK has separated tens of thousands of children from their parents
and prevented many British citizens from living on the territory with their partner of choice. Meanwhile
in the US, deportations of irregular migrants including people who entered the United States as small
children, disfigured the Obama administration. My Facebook is full of people up in arms about Donald
Trump saying he'll deport 2-3 million, but
where were they when Obama deported 2.5 million? neoliberalism, it would be nice to try some.
And from a social and economic justice perspective, the neoliberal agenda has gone backwards rather
than forwards over much of the period. The Rawlsian ideal of society as a system of co-operation
that both guarantees basic liberties but ensures that society works for the benefit of everyone,
and especially the least advantaged, looks further away now than it did in the 1970s. The "well ordered
society", in some respects recognizably the philosophical expression of the New Deal looks unimaginablly
distant from our present condition. Now political philosophers worry about the relevance of "ideal
theory", which can seem like a Byzantine discussion of the architecture of castles made of chocolate:
back then a fair society seemed almost close enough to touch.
(Not that there haven't been gains also over the past 30 years. Though Section 28 was a setback,
the cause of equality for women and LBGT people has advanced a lot, and in both the UK and the US
we now enjoy equal marriage, an idea unthinkable at the beginning of the period. Racial equality
presents a more mixed picture, notwithstanding the election of Obama.)
So what Deerin's article actually means by "neoliberalism" is a set of policies of free trade,
deregulation and privatization, pursued aggressively by governments of all stripes over the past
thirty years. These have indeed failed people, and policies of austerity coupled with bailouts for
the banks have enraged the voters, so that many people, nostalgic for a more equal and more functional
society but confused about who to blame, have channelled their resentments against immigrants and
minorities.
I wouldn't want to be misunderstood here. What is coming is far far worse than what we've had.
For all of their many faults, Blair, the Clintons, Obama, and even, occasionally, Bush and Cameron
paid lip-service to ideals of freedom and equality, to the rule of law, to the various international
treaties and obligations their countries were parties to, even as they often worked in practice to
evade them. Clinton practised interdiction of refugees on the high seas, but stayed committed to
the letter of the Refugee Convention. Cameron denied poor people access to justice and removed "foreign
criminals" to distant countries without due process, but he included the "rule of law" in the roster
of "British values". In the next period I expect a lot less of the shameful hypocrisy and a great
deal more shameless assertion of power against people who have the wrong skin colour or the wrong
class or live in the wrong country. But what has got us to where we are is not "liberalism"... it
is the systematic neglect of liberal respect for the rights of individuals coupled with the brutal
assertion of deregulation and privatization...
Obviously Mr. Deerin is, on its face, utilizing a very disputable definition of "liberal."
However, I think a stronger case could be made for something like Mr. Deerin's argument, although
it doesn't necessarily get to the same conclusion.
My observation is that the New Class (professionals, lobbyists, financiers, teachers, engineers,
etc.) have ruled the country in recent decades. For much of the twentieth century this class
was in some tension with corporations, and used their skills at influencing government policy
to help develop and protect the welfare state, since they needed the working class as a counterweight
to the natural influence of corporate money and power. However, somewhere around 1970 I think
this tension collapsed, since corporate managers and professionals realized that they shared the
same education, background and interests.
Vive la meritocracy. This "peace treaty" between former rivals allowed the whole newly enlarged
New Class to swing to the right, since they really didn't particularly need the working class
politically anymore. And since it is the hallmark of this class to seek prestige, power and money
while transferring risk away from themselves, the middle class and blue collar community has been
the natural recipient. Free trade (well, for non-professionals, anyway), neoliberalism, ruthless
private equity job cutting, etc., etc. all followed very naturally. The re-alignment of the Democratic
Party towards the right was a natural part of this evolution.
I think the 90% or so of the community who are not included in this class are confused and
bewildered and of course rather angry about it. They also sense that organized politics in
this country – being chiefly the province of the New Class – has left them with little leverage
to change any of this. Watching the bailouts and lack of prosecutions during the GFC made
them dimly realize that the New Class has very strong internal solidarity – and since somebody
has to pay for these little mistakes, everyone outside that class is "fair game."
So in that sense–to the extent that you define liberal as the ideology of the New Class
(neoliberal, financial-capitalistic, big corporate-friendly but opposed to non-meritocratic biases
like racism, sexism, etc.) is "liberalism", I think it is reasonable to say that it has bred resistance
and anger among the "losers." As far as having "failed", well, we'll see: the New Class still
controls almost all the levers of power. It has many strategies for channeling lower-class anger
and I think under Trump we'll see those rolled out.
Let me be clear, I'm not saying Donald Trump is leading an insurgency against the New Class
– but I think he tapped into something like one and is riding it for all he can, while not really
having the slightest idea what he's doing.
Perhaps some evolution in "the means of production" or in how governments are influenced
will ultimately develop to divide or downgrade the New Class, and break its lock on the corridors
of power, but I don't see it on the horizon just yet. If anyone else does, I'd love to hear more
about it.
nastywoman 11.13.16 at 9:48 pm ( )
It's not our fault I agree -(whatever these politics words are you used to call us)
In Great Britain it's all the fault of the guys who sold Range Rover and Jaguar to some
Indians – and the Mini, Bentley and even Rolls Royce to the Germans – and instead of keeping on
building stuff we all became either Bankers or Real Estate Agents – with the exceptions of everybody
who doesn't have a job – or has a job he no like or get's payed bad.
And in the United States of Trump it's even worst. There everything is either Made in China
or Made in Germany and Americans are just people who flip Hamburgers with Facebook and Google
and a few Bankers and a lot more people in Real Estate.
And do you know that there is this old American Indian saying that you can't eat money?
And now the people who got nothing to eat got so mad that all these Americans running around asking
each other whose fault it is.
And I think it's still the fault of the Germans because they now have our Rollses and Bentleys
and they sell them cars to the Americans and Trump for sure has some kind of Bently -(perhaps
even a Continental) and then the people say it's the fault of some political things.
If neoliberalism means political correctness, social constructivism (about gender, race,
etc), identity politics, and mass immigration then of course it has grown in influence over the
past 30 years. It is wilful blindness to say otherwise.
RichardM 11.13.16 at 10:21 pm
To give a view from somewhere up past low orbit, where the globe is the size of a boardgame,
it comes down to this. The US, or perhaps the 5 eyes countries, are a faction. That faction has
two assets that cause it it favor ceetain strategies. One asset is the most advanced military,
the other the best high-end educational system.
The strategy for the 40 year-period since the final gasps of formal imperialism has been
to use the military only just enough to ensure a playing field on which the educated elite can
press their advantage. And of course use the educated elite to develop better weapons.
This strategy is falling apart because the educated are no longer willing to volunteer effort
out of patriotism to develop better weapons; hence the F35. And because those who have plenty
of patriotism, but no particular globally-marketable skills, are offered no narrative that empowers
them, only insulting welfare.
Trump_vs_deep_state increasingly sounds like a viable strategy; start more and bigger wars so that
valor is favored over cleverness. Win those wars, and take tribute from the defeated, instead
of paying to rebuild them. If you change a regime, change it to a dictatorship; only a dictator
can pay tribute.
Arrest your domestic political opponents, or simply have them killed, and you don't need to
worry about meeting the demands of anyone outside your support base. So you have more money to
spend on weapons, even if they are not as high tech: F17s and A10s are enough to beat anyone without
nukes.
That change of strategy is what people mean when they say the end of 'liberal progressivism';
the end of the period where the educated were a key strategic resource.
The centre-left has done particularly bad in this new political situation. The centre
right has held up ok. The far right, is obviously doing fantastically. The far left continues
to trundle along, with some occasional successes (Greece, Nepal) although revolts are quickly
crushed, as they always are, with the remnants of the centre-left collaborating with the centre
and far right to crush it (cf also what's happening to Corbyn). (the 'pink tide' in South America
is also of course fast receding now that Venezuela has run into problems, what with the American
backed coups in Brazil and Honduras). And the centre ground per se has simply evaporated.
What we are faced with here is a fundamental revolt against all 'neoliberal' trans-national
organisations and entities: indeed against globalisation itself, which is why I suspect that in
the long run Trump is simply waking up and smelling the coffee when he hints that the EU and Nato
have no future (in the very long term the UN itself might be doomed). It's noticeable that
on the very very few occasions that the left has won power and actually prospered (e.g. Scotland)
it's very closely aligned, not to traditional internationalism, but to nationalism. CF also Plaid
Cymru which might yet become a force to be reckoned with.
But apart from these outliers, as Owen Jones argued recently, for most European countries
the future might be Poland, where the left has simply ceased to exist and all elected parties
are right wing.
The reasons for this trend are long and complicated (mainly economic, but also cultural), but
trends tend to keep on developing until something pretty harsh stops them: the trend towards totalitarianism
in the 1920s and 1930s was only stopped by WW2: can we really imagine such a cataclysm now, and
are we prepared to pay that price simply so that social democracy might yet again prosper afterwards?
We might not have a choice: WW3 might be upon us sooner than we think. As I pointed out in previous
threads the decline of Empires can be as dangerous as their rise and now that the American Empire
is now unarguably in decline sharks will start to circle: indeed they are already doing so.
Another point is this: 'Just consider a country like Bangladesh. It's a low-lying coastal plain;
it has hundreds of millions of people. As the sea level rises slightly, those people are going
to have to flee. New the chief environmental scientist of Bangladesh recently warned that tens
of millions of people are going to have to flee in the coming years, just from sea level rising.
And he made an interesting comment. He said that if we lived in a just world, these people would
be admitted into the rich countries, the United States, England, and others, because those are
the countries that are responsible for it, and have the capacity to absorb them.
If we think we have an immigrant crisis today, which is non-existent, what is it going to be
like when tens of millions of people are fleeing from rising sea levels? And that's just the beginning.
Just keep to South Asia. The water supply of South Asia comes mostly from glaciers in the Himalaya
Mountains. They are melting. What happens when they disappear? Thea are melting pretty fast. There
goes the water supply for South Asia. Couple of billion people. In India alone, right now, there
are already, about, estimated, 300 million people who barely have access to water. What's going
to happen to them? It's all over the place. Our coastal cities are going to disappear, and the
extreme weather events will increase'. (
http://www.jungundnaiv.de/2016/10/23/noam-chomsky-the-alien-perspective-episode-284-english/
)
Please note this is going to happen: it's now inevitable. Nothing can stop it. In 100 years
time there will be not millions but tens of millions, hundreds of millions of people in the Global
South who will be on the move to the North. And who, politically, will benefit from this? Not
the left.
I have noticed that people on the left don't like talking about this, because they have been
deluding themselves for decades that it won't happen.Well, it will, and it's time to start worrying
about how to keep the progressive flame alive in the increasingly bleak decades that lie ahead
(just to be clear, I don't mean, specifically the next 20 years time, when things will probably
hold together, I mean the 2nd half of the 21st century and beyond).
The other point is to look at the nature of the crisis. People look back to 1930 or even 1848.
Actually the left has not been in such a weak state since maybe the 1820s, and unlike then, there
is no clear path back to power, no clear way forward. I am not saying that I have any solutions,
but we should start by admitting the scale of the disaster and not comforting ourselves with false
hopes (of the 'if only Clinton had done this things would have been alright').
So we really need to rethink things from first principles and, to get back to topic of the
OP think about how to defend liberal values, when the entire trend of history seems to be turning
away form those values, and in a time of severe ecological crisis. We also need to think about
how to apply so to speak supranational values when the supranational entities which previously
instantiated those values no longer exist (or no longer exist in the shape they are in now).
bob mcmanus 11.13.16 at 10:40 pm
"Liberal progressive" is a redundancy. These words have histories: Richard Kline from Naked
Capitalism
Liberals, Progressives, and Radicals 2011, mostly America but some UK references
Posted without comment, wanting to reread both Kline and Bertram.
I am a very minor part of the Jacobin crowd, but today I think I will visit The New Inquiry
at the right and read what their crew of minority women have to say. And I want to mention race
in every comment.
I'm not sure if the distinction between various definitions of [neo]liberalism matters so much.
There's a lot I don't like about contemporary '[neo]liberalism' (in that I would favor a more
redistributionist and social democratic system), but I think I should be classified as someone
broadly in support of the current 'system' (which is to say pro EU, pro an open(ish) global economy,
sympathetic towards immigration etc) I don't get everything I want, but who does?
I get more
than most, and the current order works towards me and my ilk (younger, with access to third level,
ability to move for jobs so on and so forth).
I am not speaking for CB or his preferences here, but I think my profile could be generalised
from. We *are* catered towards. Look at the differences in labor market participation and unemployment
rates between people with differing levels of education. Look at whose values are represented
in the media. Look at whose policy preferences are represented in the political system. The
story isn't the 1% (well, it is, but not solely) but probably the top 10% (not only in income
but educational attainment).
I hope the [neo]liberal order survives and is improved, but, tbh, at this stage liberals
(for a broad definition) need to start thinking seriously about how they're going to make it work
for more people. And if they can't, but continue to get bogged down in the trivial nonsense that
makes up so much of liberal politics these days (not personalising this to the OP or anyone here,
but in general about contemporary politics) then they deserve to lose.
Dr. Hilarius 11.13.16 at 11:38 pm
Meyer at 4 says it well. In my own deep-blue state of Washington, we have two Democratic senators.
They have safe seats and don't face any realistic challenges from the right given voter demographics.
Yet I expect only the most tepid and symbolic action by them to resist Trump's likely policies.
They are already so tied to large corporate interests, including defense contractors, that they
will find ample opportunity for compromise, usually getting nothing of substance in return.
Their reputations as liberals rests mostly on supporting social justice issues. I do not
mean to minimize the importance of social justice but for these senators it carries no cost or
risk. But when it comes to issues of income inequality, foreign policy (remember those defense
contractors), substantive action on climate change or single-payer health care they are nowhere
to be found. They will fight on trade issues, both being supporters of TPP, validating the view
that they don't care about people working outside of liberal enclaves.
Too many liberal politicians sold out to lip service on identity politics while refusing to
antagonize their corporate supporters by pushing for economic changes which might have defused
some of the anger and alienation behind Trump's victory.
[Neo]Liberal politics has failed liberal principles-is that not the point?
The illiberal reality of periods of supposedly liberal governance are, then, quite beside
the point. It is about "neoliberalism" (admittedly as wooly a term as they come) as a political
narrative, project and agenda-this has fallen apart.
[Neo]Liberal politics descended into moralism-smug condescension-instead of addressing people's
fears at their root.
When it comes to countering extremism, [neo]liberal politicians and academics
alike are revealed as clueless and spent. Shaming the shameful just doesn't work. Not on
its own at least. But this is all that the establishmentarian [neo]liberal elite (for this is
not altogether imaginary) have to offer. Condemnation without persuasion, which can only follow
from an understanding of causation.
Hidari #9
"As I pointed out in previous threads the decline of Empires can be as dangerous as their rise
and now that the American Empire is now unarguably in decline sharks will start to circle: indeed
they are already doing so."
How is the American Empire in decline? And how do we measure its decline? Maybe the question
sounds naive, but I see lots of comments in threads here and there about purported U.S. decline
with no explanation for said conclusion.
British diplomat John Glubb wrote a book called "The Fate of Empires and Search For Survival."
Glubb noted that the average age of empires since the time of ancient Assyria (859-612 B.C.)
is 250 years. Only the Mameluke Empire in Egypt and the Levant (1250-1517) made it as far as
267 years. America is 238 years old and is exhibiting signs of decline. All empires begin,
writes Glubb, with the age of pioneers, followed by ages of conquest, commerce, affluence,
intellect and decadence. America appears to have reached the age of decadence, which Glubb
defines as marked by "defensiveness, pessimism, materialism, frivolity, an influx of foreigners,
the welfare state, [and] a weakening of religion."
The most important is probably the fact that the ideology of the current US empire -- neoliberalism
(called here "liberal progressivism") -- became discredited after 2008. What happened after the
collapse of the Marxist ideology with the USSR is well known. It took 46 years (if we assume that
the collapse started in 1945 as the result of victory in WWII, when the Soviet army has a chance
to see the standard of living in Western countries). Why the USA should be different ? Decline
of empires is very slow and can well take a half a century. Let's say it might take 50 years from
9/11 or October 2008.
One telling sign is the end of "American hegemony" in the global political sphere. One telling
sign is the end of "American hegemony" in the global political sphere. As Lupita hypothesized
here Trump might be the last desperate attempt to reverse this process.
Another, the deterioration of the standard of living of the USA population and declining infrastructure,
both typically are connected with the overextension of empire. In Fortune (
http://fortune.com/2015/07/20/united-states-decline-statistics-economic/
) Jill Coplan lists 12 signs of the decline.
Trump election is another sign of turmoil. The key message of his election is "The institutions
we once trusted deceived us" That includes the Democratic Party and all neoliberal MSM. Like was
the case with the USSR, the loss of influence of neoliberal propaganda machine is a definite sign
of the decline of empire.
Degeneration of the neoliberal political elite that is also clearly visible in the current set
of presidential candidates might be another sign. Hillary Clinton dragged to the car on 9/11 commemorative
event vividly reminds the state of health of a couple of members of Soviet Politburo .
"... There are some who believe the elites are actually splintered into numerous groups and that domestic US elites have positioned themselves against the banking elites in London's City. ..."
"... US elites are basically in the employ of a handful of families, individuals and institutions in our view. It is confusing because it is hard to tell if Hillary, for instance, is operating on her own accord or at the behest of higher and more powerful authorities. ..."
"... It is probably a combination of both but at root those who control central banks are managing the world's move towards globalism. ..."
"... The vote to propel Trump to the US presidency reflects a profound backlash against open markets and borders, and the simmering anger of millions of blue-collar white and working-class people who blame their economic woes on globalisation and multiculturalism. ..."
"... If indeed Trump's election has damped the progress of TPP, and TTIP, this is a huge event. As we've pointed out, both agreements effectively substituted technocratic corporatism for the current sociopolitical model of "democracy." ..."
"... one of the elite's most powerful, operative memes today is "populism vs. globalism" ..."
"... No matter what, the reality of these two events, the victories of both Trump and Brexit, stand as signal proof that elite stratagems have been defeated, at least temporarily. Though whether these defeats have been self-inflicted as part of a change in tactics remains to be seen. ..."
Was Trump's victory actually created by the very globalist elites that Trump is supposed to have
overcome? There are some who believe the elites are actually splintered into numerous groups and
that domestic US elites have positioned themselves against the banking elites in London's City.
We
see no fundamental evidence of this.
The world's real elites in our view may have substantive histories in the hundreds and
thousands of years. US elites are basically in the employ of a handful of families,
individuals and institutions in our view. It is confusing because it is hard to tell if Hillary,
for instance, is operating on her own accord or at the behest of higher and more powerful
authorities.
It is probably a combination
of both but at root those who control central banks are managing the world's move towards globalism.
History easily shows us who these groups are – and they are not located in America.
This is a cynical perspective to be sure, and certainly doesn't remove the impact of Trump's victory
or his courage in waging his election campaign despite what must surely be death threats to himself
and his family..
But if true, this perspective corresponds to predictions that we've been making for nearly a decade
now, suggesting that sooner or later elites – especially those in London's City – would have to "take
a step back."
More:
The vote to propel Trump to the US presidency reflects a profound backlash against open markets
and borders, and the simmering anger of millions of blue-collar white and working-class people
who blame their economic woes on globalisation and multiculturalism.
"There are a few parallels to Switzerland – that the losers of globalisation find somebody
who is listening to them," said Swiss professor and lawyer Wolf Linder, a former director of the
University of Bern's political science institute.
"Trump is doing his business with the losers of globalisation in the US, like the Swiss People's
Party is doing in Switzerland," he said. "It is a phenomenon which touches all European nations."
... ... ...
If indeed Trump's election has damped the progress of TPP, and TTIP, this is a huge event. As
we've pointed out, both agreements effectively substituted technocratic corporatism for the current
sociopolitical model of "democracy." The elites were trying to move toward a new
model of world control with these two agreements. ...
Additionally, one of the elite's most powerful, operative memes today is "populism vs. globalism"
that seeks to contrast the potentially freedom-oriented events of Trump and Brexit to the discarded
wisdom of globalism. See
here and
here.
No matter what, the reality of these two events, the victories of both Trump and Brexit, stand
as signal proof that elite stratagems have been defeated, at least temporarily. Though whether these
defeats have been self-inflicted as part of a change in tactics remains to be seen.
Conclusion: But the change has come. One way or another the Internet and tens of millions or people
talking, writing and acting has forced new trends. This can be hardly be emphasized enough. Globalism
has been at least temporarily redirected.
Editor's Note: The Daily Bell is giving away a silver coin and a silver "white paper" to subscribers.
If you enjoy DB's articles and want to stay up-to-date for free, please subscribe
here .
The analysis is flawed in that it fails to understand the context for power and influence in the
western alliance. The Crowns in contest are seeking coordinated domination through political proxy,
i.e. the force behind the EU and the UN. The problem is the most influential crown was not in
a mind to destroy the fabric of their civilization and more importantly to continue to bail-out
the "socialist" paradises in the continent and beyond. Britannia has its own socialism to support
much less that of the world.
Trump represents keeping the Colony in line with a growing interest in keeping traditions intact
and in more direct control of Anglo values. Europe has this insane multi-culturalism that is fundamentally
incompatible with a "free" and robust civilization. The whole goal of detente with China was to
convert them to our values via proxy institutions and that is working in the long-run. In the
short-run, the Empire must reunite and solidify its value bulwark against the coming storm from
China and to a lesser extend from the expanded EU states. Russia is playing out on its own.
Most commenters do not realise that it is neoliberalism that caused the current suffering of
working people in the USA and elsewhere...
Notable quotes:
"... Working class wages destroyed. The wages of the low paid lowered. Ordinary people robbed of holiday and sickness pay. Working people priced out of ever owning their own home. Our city centers socially cleansed of the working class. Poor people forced to fight like rats in sacks with even poorer foreigners for jobs, housing, school places and social and health services. ..."
"... Keep going mate. Continue to pump out that snobbish attitude because every time you do you've bagged Mr Trump, Mr Farage and Ms LePen another few votes. ..."
"... I recall a time when any suggestion that immigration may be too high was silenced by cries of racism, eventually that label was misused so often that it lost its potency, one gets the sense that this trend for dubbing those who hold certain opinions as somehow unintelligent will go the same way. People are beginning to see through this most hateful tactic of the Modern Left. ..."
"... Which is why I think Mr D'Ancona and many others are wrong to say that Farage and Trump will face the whirlwind when voters realise that their promises were all unachievable. The promises were much less important than the chance to slap the political world in the face. Given another chance, a lot of voters will do the same again. ..."
"... I think the author completely misses the most salient point from the two events he cites: simply that the *vast* majority of people have become completely disenfranchised with the utter corruption that is mainstream politics today. ..."
"... It doesn't matter who is voted in, the status quo [big business and the super-rich get wealthier whilst the middle is squeezed and the poorest are destroyed] remains. ..."
"... The votes for Brexit and Trump are as much a rejection of "establishment" as anything else. Politicians in both countries heed these warnings at their peril... ..."
"... The majority of the people are sick and tired of PC ism and the zero hour, minimum wage economy that both Britain and America have suffered under "globalisation". And of the misguided "[neo]liberal" agenda of much of the media which simply does not speak to or for society. ..."
"... People in western democracies are rising up through the ballot box to defeat PC [neo]liberalism and globalisation that has done so much to impoverish Europe and America morally and economically. To the benefit of the tax haven corporates. ..."
"... Globalisation disembowelled American manufacturing so the likes of Blair and the Clintons could print money. The illimitable lives they destroyed never entered their calculus. ..."
"... I have stood in the blue lane in Atlanta waiting for my passport to be processed; in the adjoining lane was a young British female student (so she said to the official). The computer revealed she had overstayed her visa by 48 hours the last time she visited. She was marched out by two armed tunics to the next plane home. That's how Europeans get treated if they try to enter America illegally. Why the demented furor over returning illegal Hispanics or anyone else? ..."
Surely the people who voted for Trump and Farage are too stupid to realise the sheer,
criminal folly of their decision...
thoughtcatcher -> IanPitch 12h ago
Working class wages destroyed. The wages of the low paid lowered. Ordinary people
robbed of holiday and sickness pay. Working people priced out of ever owning their own home.
Our city centers socially cleansed of the working class. Poor people forced to fight like rats
in sacks with even poorer foreigners for jobs, housing, school places and social and health
services.
But yeah, they voted against the elite because they are "stupid".
attila9000 -> IanPitch 11h ago
I think at some point a lot of them will realize they have been had, but then they will
probably just blame immigrants, or the EU. Anything that means they don't have to take
responsibility for their own actions. It would appear there is a huge pool of people who can
be conned into acting against their own self interest.
jonnyoyster -> IanPitch 11h ago
Keep going mate. Continue to pump out that snobbish attitude because every time you do
you've bagged Mr Trump, Mr Farage and Ms LePen another few votes. Most people don't
appreciate being talked down to and this arrogant habit of calling those who hold views
contrary to your own 'stupid' is encouraging more and more voters to ditch the established
parties in favour of the new.
I recall a time when any suggestion that immigration may be too high was silenced by
cries of racism, eventually that label was misused so often that it lost its potency, one gets
the sense that this trend for dubbing those who hold certain opinions as somehow unintelligent
will go the same way. People are beginning to see through this most hateful tactic of the
Modern Left.
DilemmataDocta -> IanPitch 11h ago
A lot of the people who put their cross against Brexit or Trump weren't actually voting for
anything. They were just voting against this, that or the other thing about the world that
they disliked. It was voting as a gesture.
Which is why I think Mr D'Ancona and many others are wrong to say that Farage and Trump
will face the whirlwind when voters realise that their promises were all unachievable. The
promises were much less important than the chance to slap the political world in the face.
Given another chance, a lot of voters will do the same again.
Sproggit 12h ago
I think the author completely misses the most salient point from the two events he
cites: simply that the *vast* majority of people have become completely disenfranchised with
the utter corruption that is mainstream politics today.
It doesn't matter who is voted in, the status quo [big business and the super-rich get
wealthier whilst the middle is squeezed and the poorest are destroyed] remains.
The votes for Brexit and Trump are as much a rejection of "establishment" as anything
else. Politicians in both countries heed these warnings at their peril...
NotoBlair 11h ago
OMG, the lib left don't Geddit do they?
The majority of the people are sick and tired of PC ism and the zero hour, minimum wage
economy that both Britain and America have suffered under "globalisation". And of the
misguided "[neo]liberal" agenda of much of the media which simply does not speak to or for
society.
People in western democracies are rising up through the ballot box to defeat PC [neo]liberalism
and globalisation that has done so much to impoverish Europe and America morally and
economically. To the benefit of the tax haven corporates.
The sour grapes bleating of the lib left who refuse to accept the democratic will of the
people is a movement doomed failure.
Frankincensedabit 11h ago
Malign to whom? Wall Street and people who want us all dead?
Globalisation disembowelled American manufacturing so the likes of Blair and the Clintons
could print money. The illimitable lives they destroyed never entered their calculus.
I have stood in the blue lane in Atlanta waiting for my passport to be processed; in the
adjoining lane was a young British female student (so she said to the official). The computer
revealed she had overstayed her visa by 48 hours the last time she visited. She was marched
out by two armed tunics to the next plane home. That's how Europeans get treated if they try
to enter America illegally. Why the demented furor over returning illegal Hispanics or anyone
else?
I likely wouldn't have voted at all. But all my life the occupants of the White House
represented the interests of those nobody could ever identify. The owners of the media and the
numbered accounts who took away the life-chances of U.S. citizens by the million and called
any of them who objected a thick white-trash bigot. Whatever Trump is, he will be different.
A sweeping Pacific trade pact meant to bind the U.S.and Asia effectively died Friday, as Republican
and Democratic leaders in Congress told the White House they won't advance it in the election's aftermath,
and Obama administration officials acknowledged it has no way forward now.
The failure to pass the 12-nation Trans-Pacific Partnership-by far the biggest trade agreement
in more than a decade-is a bitter defeat for President Barack Obama, whose belated but fervent support
for freer trade divided his party and complicated the campaign of Democratic nominee Hillary Clinton.
The White House had lobbied hard for months in the hope of moving forward on the pact if Mrs.
Clinton had won.
The deal's collapse, which comes amid a rising wave of antitrade sentiment in the U.S., also dents
American prestige in the region at a time when China is flexing its economic and military muscles.
Just over a year ago, Republicans were willing to vote overwhelmingly in support of Mr. Obama's
trade policy. But as the political season approached and voters registered their concerns by supporting
Donald J. Trump, the GOP reacted coolly to the deal Mr. Obama's team reached with Japan and 10 others
countries just over a year ago in Atlanta. ...
With President-elect Trump's victory last night, the last hopes of the Obama administration passing
the Trans-Pacific Partnership (TPP) during the lame duck session of Congress have evaporated. The
passage of the TPP through Congress was dependent upon support from members of the Republican majority,
and there is no realistic prospect that they will now pass the deal given their elected President's
firmly expressed opposition to it. Even if they did so, the new President would presumably veto the
pact's implementing legislation.
"[Trump] has many tools to reverse the post World War II consensus on liberalizing U.S. trade
without needing congressional approval. For instance, he can withdraw from the North American Free
Trade Agreement, as he has threatened to do, by simply notifying the U.S.' Nafta partners, Mexico
and Canada, and waiting six months. Withdrawing from the World Trade Organization, which sets rules
for global trading and enforces tariffs, has a similar provision" [
Wall
Street Journal
, "Donald Trump Will Need to Leverage Size, Power of U.S. Economy to Remake Global
Trading System"]. "'Our major trading partners are far more likely to cooperate with an America resolute
about balancing its trade than they are likely to provoke a trade war,' wrote Trump economic advisers
Peter Navarro [
here
]
of the University of California-Irvine and investor Wilbur Ross in September. 'This is true for one
very simple reason: America's major trading partners are far more dependent on American markets than
America is on their markets.'"
TPP: "To take effect, TPP must be ratified by February 2018 by at least six countries that account
for 85 percent of the 12 members' aggregate economic output. This effectively means that the U.S.
and Japan, the world's third-largest economy and the second-largest that is a signatory nation, must
both be on board" [
DC
Velocity
].
TPP: "Mr. Trump's win also seals the fate of President Barack Obama's 12-nation trade agreement,
the Trans-Pacific Partnership, or TPP. The president-elect blamed the TPP on special interests who
want to "rape" the country" [
Wall
Street Journal
, "Donald Trump Win to Upend Trade Policy"]. "Mr. Obama had hoped to work with
Republican lawmakers to pass the TPP during the 'lame duck' session of Congress after the election,
where they faced an uphill battle even if Tuesday's vote had favored Hillary Clinton, who previously
backed the TPP negotiations. Now Republicans have little incentive to bring the TPP to a vote, since
Mr. Trump could easily threaten to unravel the deal when he takes office and block its implementation,
as well as punish lawmakers who vote for it."
TPP: "Donald Trump's historic victory Tuesday has killed any chance of Congress voting on President
Barack Obama's signature Asia-Pacific trade agreement while raising the odds of a damaging trade
confrontation with China - just two ways a Trump presidency could upend the global trading system
and usher in a new era of U.S. protectionism, analysts say" [
Politico
].
"'This is the end of globalization is we knew it … because what the U.S. is going to do is certainly
going to impact other countries' and their decisions on negotiations,' Gary Hufbauer, a senior fellow
at the Peterson Institute for International Economics, told Politico. 'TPP is now in the history
dustbin for sure,' Hufbauer said."
TPP: "House GOP election outcomes will be key as House Speaker Paul Ryan decides whether to bring
the TPP to a vote in the lame-duck session with GOP voters strongly against and the GOP 's high-donor
base demanding action. With an eye to conservative GOP threats to withhold support for his speakership
and a possible 2020 presidential run, Ryan's decision is complicated. Whether the TPP will get a
lame-duck vote is his call. Beyond whether he can muster the votes of representatives who weathered
the wrath of trade voters in this cycle and worry about the 2018 primaries lies the longer-term implications
of his even trying to do so with the GOP voter base so intensely against the pact" [Lori Wallach,
Eyes on Trade
].
That's why a British court has effectively overturned the results of the Brexit vote – in
a lawsuit brought by a hedge fund manager and former model – and thrown the fate of the country
into the hands of pro-EU Tories, and their Labor and Liberal Democrat collaborators.
This stunning reversal was baked in to the legislation that enabled the referendum to begin
with, and is par for the course as far as EU referenda are concerned: in 1992,
Danish voters rejected the EU, only to have the Euro-crats demand a rematch with a "modified"
EU treaty which won narrowly. There have been repeated attempts to modify the modifications,
which have all failed. Ireland voted against both the Lisbon Treaty and the Nice Treaty, only
to have the issue brought up again until the "right" result was achieved.
"... "Yet commentators who have been ready and willing to attribute Donald Trump's success to anger, authoritarianism, or racism rather than policy issues have taken little note of the extent to which Mr. Sanders's support is concentrated not among liberal ideologues but among disaffected white men." ... ..."
"... poor pk a leader of the Stalinist press ..."
"... the surprising success of Bernie Sanders -- a Brooklyn-born, Jewish socialist -- in the primaries is solid proof that the electorate was open to a coherent argument for genuine progressive change, and that a substantial portion of that electorate is not acting on purely racist and sexist impulses, as so many progressive commentators say. ..."
"... "I will live my life calmly and my children will be just fine. I will live my life calmly and my children will be just fine." That assumes you're about 85 years old...and don't have long to live! ..."
"... Laid out by whom? By the commercial "media" hype machine that has 12-16 hours of airtime to fill every day with the as sensationalized as possible gossip (to justify the price for the paid advertisements filling the remaining hours). ..."
"... Killary Clinton got no closer than Ann Arbor this weekend, a message! ..."
"... Mr. Krugman forgot to list the collusion of the DNC and the Clinton campaign to work against Sanders. ..."
"... putting crooked in the same sentence as Clinton or DNC is duplicative wording. This mortification is brought to US by the crooked and the stalinist press that calls crooked virtue. ..."
"... Krugman did so much to help create the mass of white working class discontent that is electing Trump. Krugman and co cheering on NAFTA/PNTR/WTO etc, US deindustrialization, collapse of middle class... ..."
"... Hopefully the working class masses will convince our rulers to abandon free trade before every last factory is sold off or dismantled and the US falls to the depths of a Chad or an Armenia. ..."
The Truth About the Sanders Movement
By Paul Krugman
In short, it's complicated – not all bad, by any means, but not the pure uprising of idealists
the more enthusiastic supporters imagine.
The political scientists Christopher Achen and Larry Bartels have an illuminating discussion
of Sanders support. The key graf that will probably have Berniebros boiling is this:
"Yet commentators who have been ready and willing to attribute Donald Trump's success to
anger, authoritarianism, or racism rather than policy issues have taken little note of the extent
to which Mr. Sanders's support is concentrated not among liberal ideologues but among disaffected
white men." ...
[ Yes, I do find defaming people by speculation or stereotype to be beyond saddening. ]
The fact that Obama either won, or did so much better than Hillary appears to be doing with, the
white working-class vote in so many key battleground states, as well as the surprising success
of Bernie Sanders -- a Brooklyn-born, Jewish socialist -- in the primaries is solid proof that
the electorate was open to a coherent argument for genuine progressive change, and that a substantial
portion of that electorate is not acting on purely racist and sexist impulses, as so many progressive
commentators say.
And her opponent was/is incapable of debating on substance, as there was/is neither coherence
nor consistency in any part of his platform -- nor that of his party....
Question is, will Krugman be able to move on after the election...and talk about something useful?
Like how to get Hillary to recognize and deal with inequality...
Barbara Ehrenreich: "Forget fear and loathing. The US election inspires projectile vomiting. The
most sordid side of our democracy has been laid out for all to see. But that's only the beginning:
whoever wins, the mutual revulsion will only intensify... With either Clinton or Trump, we will
be left to choke on our mutual revulsion."
"I will live my life calmly and my children will be just fine. I will live my life calmly
and my children will be just fine." That assumes you're about 85 years old...and don't have long
to live!
Laid out by whom? By the commercial "media" hype machine that has 12-16 hours of airtime to
fill every day with the as sensationalized as possible gossip (to justify the price for the paid
advertisements filling the remaining hours).
Something interesting today.... President Obama came to Michigan. I fully expected him to speak
in Detroit with a get out the vote message. Instead he is in Ann Arbor, speaking to an overwhelmingly
white and white-collar audience. On a related note, the Dems have apparently written off
the white blue collar vote in Michigan, even much of the union vote. the union leaders are pro
Clinton, but the workers not so much. Strange year.
The real danger of serious election-rigging: electronic voting machines. How do we know the machine
*really* recorded everyone's votes correctly? (Did any Florida county ever give Al Gore negative
something votes?)
That's a big subject but you are right, that is the biggest risk of significant fraud. Not just
the voting machines, but the automatic counting systems. Other forms of possible election fraud
are tiny by comparison.
Here is the transcript from 60 Minutes about the Luntz focus group rancor. Instructive to read
about the depth of feeling in case you didn't see the angry, disgusted faces of citizens.
putting crooked in the same sentence as Clinton or DNC is duplicative wording. This mortification
is brought to US by the crooked and the stalinist press that calls crooked virtue.
Before the 1970s the US was both rich and protectionist - no look at our horrible roads and hopeless
people - the miracle of free trade! : ,
November 07, 2016 at 07:13 PM
Krugman did so much to help create the mass of white working class discontent that is electing
Trump. Krugman and co cheering on NAFTA/PNTR/WTO etc, US deindustrialization, collapse of
middle class...
Hopefully the working class masses will convince our rulers to abandon free trade before
every last factory is sold off or dismantled and the US falls to the depths of a Chad or an Armenia.
"... it's easy to imagine a President Trump refusing to heed our own highest court, which, as President Andrew Jackson observed, has no way, other than respect of institutions, to enforce its decisions. ..."
"... It's easy to carp like this but the sclerotic elite in charge of the country has failed to address demographic concerns, and has stamped out any politically incorrect thoughts as being signs of baseness. ..."
"... Now they are so upset that a challenger has arisen. It's unfortunate that this particular challenger has no background in government and will probably harm our economic growth with his lack of skill, but the elites will have to eat the cake they baked. ..."
"... Economists told us that free trade deals and open borders would make us prosperous and yet that hasn't happens. ..."
"... The technicians running trade policy, monetary policy and fiscal policy haven't held up their end of the bargain. ..."
"... Wealth and power has been redistributed upwards. ..."
"... The union movement has been destroyed in outright class war. ..."
"... The corporate media spread lies and distraction. It induces both apathy and a rat race/dog-eat-dog mentality. ..."
"... Consider how far we've moved right, so that Nixon e.g. would be considered hopelessly and radically leftist today. Given that, moving left should be one of the first things you consider. ..."
"... Yes, we've seen right wing policies killing jobs and steering wealth to the wealthy, and that's bad policy. But unfortunately it seems it's always possible to do *worse*. ..."
"... Trump's policies would double down on wealth transfer, while he spouts the typical RW mantra of "(my dopey policy which would destroy jobs) would be good for jobs." ..."
"... Economic growth fueled by foreign oil is nice while it lasts but what will happen to the country when the oil runs out or we are forced to fight a war that disrupts the supply? ..."
More Jobs, a Strong Economy, and a Threat to Institutions : ...Institutions are significant
to economists, who have come to see that countries become prosperous not because they have bounteous
natural resources or an educated population or the most advanced technology but because they have
good institutions. Crucially, formal structures are supported by informal, often unstated, social
agreements. A nation not only needs courts; its people need to believe that those courts can be
fair. ...
Over most of history, a small élite confiscated wealth from the poor. Subsistence farmers lived
under rules designed to tax them so that the rulers could live in palaces and pay for soldiers
to maintain their power. Every now and then, though, a system appeared in which leaders were forced
to accommodate the needs of at least some of their citizens. ... The societies with the most robust
systems for forcing the powerful to accommodate some of the needs of the powerless became wealthier
and more peaceful. ... Most nations without institutions to check the worst impulses of the rich
and powerful stay stuck in poverty and dysfunction. ...
This year's Presidential election has alarmed economists for several reasons. No economist,
save one , supports Donald J. Trump's stated economic plans, but an even larger concern is
that, were he elected, Trump would attack the very institutions that have provided our economic
stability. In his campaign, Trump has shown outright contempt for courts, free speech, international
treaties, and many other pillars of the American way of life. There is little reason to think
that, if granted the Presidency, Trump would soften his stand. ...
...it's easy to imagine a President Trump refusing to heed our own highest court, which, as
President Andrew Jackson observed, has no way, other than respect of institutions, to enforce
its decisions. No one knows what Trump would do as President, but, based on his statements on
the campaign trail, it's possible to imagine a nation where people have less confidence in the
courts, the military, and their rights to free speech and assembly. When this happens, history
tells us, people stop dreaming about what they could have if they invest in education, new businesses,
and new ideas. They focus, instead, on taking from others and holding tightly to what they've
already amassed. Those societies, without the institutions that protect us from our worst impulses,
become poorer, uglier, more violent. That is how nations fail.
It's easy to carp like this but the sclerotic elite in charge of the country has failed to address
demographic concerns, and has stamped out any politically incorrect thoughts as being signs of
baseness.
Now they are so upset that a challenger has arisen. It's unfortunate that this particular
challenger has no background in government and will probably harm our economic growth with his
lack of skill, but the elites will have to eat the cake they baked.
"No one knows what Trump would do as President, but, based on his statements on the campaign trail,
it's possible to imagine a nation where people have less confidence in the courts, the military,
and their rights to free speech and assembly. When this happens, history tells us, people stop
dreaming about what they could have if they invest in education, new businesses, and new ideas.
They focus, instead, on taking from others and holding tightly to what they've already amassed.
Those societies, without the institutions that protect us from our worst impulses, become poorer,
uglier, more violent. That is how nations fail."
This is all true but let's provide a little more context than the totebaggers' paint-by-numbers
narrative.
Economists told us that free trade deals and open borders would make us prosperous and
yet that hasn't happens.
The technicians running trade policy, monetary policy and fiscal policy haven't held up
their end of the bargain.
Wealth and power has been redistributed upwards.
The union movement has been destroyed in outright class war.
The corporate media spread lies and distraction. It induces both apathy and a rat race/dog-eat-dog
mentality.
The Democratic Party has been moved to right as the middle class has struggled.
And more and more people become susceptible to demagogues like Trump as Democrats try to play
both sides of the fence, instead of standing foresquarely behind the job class.
Let's hope we don't find out what Trump does if elected. My guess is that he'd delegate foreign
and domestic policy to Mike Pence as Trump himself would be free to pursue his own personal grudges
via whatever means are available.
Alex S -> Peter K.... , -1
As we can see here, through leftist glasses, the only possible remedy for solving a problem is
moving left.
Consider how far we've moved right, so that Nixon e.g. would be considered hopelessly and radically
leftist today.
Given that, moving left should be one of the first things you consider.
Consider how far we've moved right, so that Nixon e.g. would be considered hopelessly and radically
leftist today.
Given that, moving left should be one of the first things you consider.
Yes, we've seen right wing policies killing jobs and steering wealth to the wealthy, and that's
bad policy. But unfortunately it seems it's always possible to do *worse*.
Trump's policies would
double down on wealth transfer, while he spouts the typical RW mantra of "(my dopey policy which
would destroy jobs) would be good for jobs."
Tim Harford made a good case for trust accounting
for 99% of the difference in per capita GNP between the US and Somalia.
""If you take a broad enough definition of trust, then it would explain basically all the difference
between the per capita income of the United States and Somalia," ventures Steve Knack, a senior
economist at the World Bank who has been studying the economics of trust for over a decade. That
suggests that trust is worth $12.4 trillion dollars a year to the U.S., which, in case you are
wondering, is 99.5% of this country's income (2006 figures). If you make $40,000 a year, then
$200 is down to hard work and $39,800 is down to trust.
How could that be? Trust operates in all sorts of ways, from saving money that would have to
be spent on security to improving the functioning of the political system. But above all, trust
enables people to do business with each other. Doing business is what creates wealth." goo.gl/t3OqHc
Presidents and the US Economy: An Econometric Exploration
By Alan S. Blinder and Mark W. Watson
Abstract
The US economy has performed better when the president of the United States is a Democrat rather
than a Republican, almost regardless of how one measures performance. For many measures, including
real GDP growth (our focus), the performance gap is large and significant. This paper asks why.
The answer is not found in technical time series matters nor in systematically more expansionary
monetary or fiscal policy under Democrats. Rather, it appears that the Democratic edge stems mainly
from more benign oil shocks, superior total factor productivity (TFP) performance, a more favorable
international environment, and perhaps more optimistic consumer expectations about the near-term
future.
Economic growth fueled by foreign oil is nice while it lasts but what will happen to the country
when the oil runs out or we are forced to fight a war that disrupts the supply?
I was in college in the mid 1970's and we asked this question a lot. Some think this worry has
gone away. I don't agree with those types. Which is why a green technology investment drive makes
a lot of sense for so many reasons.
Quote from the paper you linked to: "Arguably, oil shocks have more to do with US foreign policy
than with US economic policy-the two Gulf Wars being prominent examples. That said, several economists
have claimed that US monetary policy played an important role in bringing on the oil shocks. See,
for example, Barsky and Kilian (2002)."
Do We Really Know that Oil Caused the Great Stagflation? A Monetary Alternative
By Robert B. Barsky and Lutz Kilian
Abstract
This paper argues that major oil price increases were not nearly as essential a part of the
causal mechanism that generated the stagflation of the 1970s as is often thought. There is neither
a theoretical presumption that oil supply shocks are stagflationary nor robust empirical evidence
for this view. In contrast, we show that monetary expansions and contractions can generate stagflation
of realistic magnitude even in the absence of supply shocks. Furthermore, monetary fluctuations
help to explain the historical movements of the prices of oil and other commodities, including
the surge in the prices of industrial commodities that preceded the 1973/74 oil price increase.
Thus, they can account for the striking coincidence of major oil price increases and worsening
stagflation.
My quote dragged on too long. I should have ended it with the first sentence. Monetary policy
could play a role but foreign policy could still be the biggest factor.
"Former Fed Vice Chairman Alan Blinder said he's skeptical that fiscal policy will be loosened
a great deal if Clinton wins the election, as seems likely based on recent voter surveys.
"She is promising not to make budget deficits bigger by her programs," said Blinder, who is
now a professor at Princeton University. "Whatever fiscal stimulus there is ought to be small
enough for the Fed practically to ignore it."
PGL told us that Hillary's fiscal program would be YUGE.
Dean Baker in "Rigged" * reminds me of the lasting limits to growth that appear to follow the
sacrifice of growth, especially to the extent of allowing a recession, for the sake of budget
balancing during a time of surrounding economic weakness:
Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich
Richer
By Dean Baker
Introduction: Trading in Myths
In winter 2016, near the peak of Bernie Sanders' bid for the Democratic presidential nomination,
a new line became popular among the nation's policy elite: Bernie Sanders is the enemy of the
world's poor. Their argument was that Sanders, by pushing trade policies to help U.S. workers,
specifically manufacturing workers, risked undermining the well-being of the world's poor because
exporting manufactured goods to the United States and other wealthy countries is their path out
of poverty. The role model was China, which by exporting has largely eliminated extreme poverty
and drastically reduced poverty among its population. Sanders and his supporters would block the
rest of the developing world from following the same course.
This line, in its Sanders-bashing permutation, appeared early on in Vox, the millennial-oriented
media upstart, and was quickly picked up elsewhere (Beauchamp 2016). After all, it was pretty
irresistible. The ally of the downtrodden and enemy of the rich was pushing policies that would
condemn much of the world to poverty.
The story made a nice contribution to preserving the status quo, but it was less valuable if
you respect honesty in public debate.
The problem in the logic of this argument should be apparent to anyone who has taken an introductory
economics course. It assumes that the basic problem of manufacturing workers in the developing
world is the need for someone who will buy their stuff. If people in the United States don't buy
it, then the workers will be out on the street and growth in the developing world will grind to
a halt. In this story, the problem is that we don't have enough people in the world to buy stuff.
In other words, there is a shortage of demand. But is it really true that no one else in the world
would buy the stuff produced by manufacturing workers in the developing world if they couldn't
sell it to consumers in the United States? Suppose people in the developing world bought the stuff
they produced raising their living standards by raising their own consumption.
That is how the economics is supposed to work. In the standard theory, general shortages of
demand are not a problem. Economists have traditionally assumed that economies tended toward full
employment. The basic economic constraint was a lack of supply. The problem was that we couldn't
produce enough goods and services, not that we were producing too much and couldn't find anyone
to buy them. In fact, this is why all the standard models used to analyze trade agreements like
the Trans-Pacific Partnership assume trade doesn't affect total employment. Economies adjust so
that shortages of demand are not a problem.
In this standard story (and the Sanders critics are people who care about textbook economics),
capital flows from slow-growing rich countries, where it is relatively plentiful and so gets a
low rate of return, to fast-growing poor countries, where it is scarce and gets a high rate of
return....
It is yuuuuge - and no I did not say anything of the sort. Rather I noted it would be less than
1% of GDP. This is what I get for trying to get the facts right. It gets too complicated for you
even when we simplify things so you get angry and start screaming "liar". Grow up.
Per capta GDP grew from $51,100 to $51,400 between July 1 2015 and July 1 2016. This 0.6% growth
does not seem to me to be a statistic supporting claims of improving employment and improving
wage growth.
Dean has suggested in one of his commentaries that wage growth may be an artifact of a decline
in the quality of health insurance coverage. Wage growth is not figured net of increased outlays
for deductibles and copays related to changes in health insurance. PPACA discourages low deductible
and low copay health plans by placing a "Cadillac tax" on them, or at least threatening to do
so. The consequent rise in wage workers' outlays for copays and deductibles are not captured in
the statistics that claim to measure wage gains. This results in an income transfer from the well
to the sick, but can produce statistics that can be interpreted in politically convenient ways
by those so inclined
I get why the plans are taxed. I don't believe that the results of that policy have been beneficial
for the bulk of the population. Most of the good done by PPACA was done by the expansion of Medicaid
eligibility. I believe that requiring the working poor people to settle for high deductible high
copay policies has had the practical effect of requiring them to choose between adequate medical
and further impoverishment. I do not believe that the PPACA could not have been financed in a
way less injurious to the working poor. As the insurers have been unable to make money in this
deal, the hospital operators seem to have been the only winners in that their bad debt problems
have been ameliorated.
"people stop dreaming about what they could have if they invest in education, new businesses,
and new ideas"
And this is entirely rational, as in the situation described, the fruits of their efforts will
likely be siphoned from their pockets by the elites and generally rent-seekers with higher social
standing and leverage, or at best their efforts will amount to too little to be worth the risk
(including the risk of wasting one's time i.e. opportunity cost). It also becomes correspondingly
harder to convince and motivate others to join or fund any worthwhile efforts. What also happens
(and has happened in "communism") is that people take their interests private, i.e. hidden from
the view of those who would usurp or derail them.
"Those who witness extreme social collapse at first hand seldom describe any deep revelation about
the truths of human existence. What they do mention, if asked, is their surprise at how easy it
is to die.
The pattern of ordinary life, in which so much stays the same from one day to the next, disguises
the fragility of its fabric. How many of our activities are made possible by the impression of
stability that pattern gives? So long as it repeats, or varies steadily enough, we are able to
plan for tomorrow as if all the things we rely on and don't think about too carefully will still
be there. When the pattern is broken, by civil war or natural disaster or the smaller-scale tragedies
that tear at its fabric, many of those activities become impossible or meaningless, while simply
meeting needs we once took for granted may occupy much of our lives.
What war correspondents and relief workers report is not only the fragility of the fabric,
but the speed with which it can unravel. As we write this, no one can say with certainty where
the unraveling of the financial and commercial fabric of our economies will end. Meanwhile, beyond
the cities, unchecked industrial exploitation frays the material basis of life in many parts of
the world, and pulls at the ecological systems which sustain it.
Precarious as this moment may be, however, an awareness of the fragility of what we call civilisation
is nothing new.
'Few men realise,' wrote Joseph Conrad in 1896, 'that their life, the very essence of their
character, their capabilities and their audacities, are only the expression of their belief in
the safety of their surroundings.' Conrad's writings exposed the civilisation exported by European
imperialists to be little more than a comforting illusion, not only in the dark, unconquerable
heart of Africa, but in the whited sepulchres of their capital cities. The inhabitants of that
civilisation believed 'blindly in the irresistible force of its institutions and its morals, in
the power of its police and of its opinion,' but their confidence could be maintained only by
the seeming solidity of the crowd of like-minded believers surrounding them. Outside the walls,
the wild remained as close to the surface as blood under skin, though the city-dweller was no
longer equipped to face it directly.
Bertrand Russell caught this vein in Conrad's worldview, suggesting that the novelist 'thought
of civilised and morally tolerable human life as a dangerous walk on a thin crust of barely cooled
lava which at any moment might break and let the unwary sink into fiery depths.' What both Russell
and Conrad were getting at was a simple fact which any historian could confirm: human civilisation
is an intensely fragile construction. It is built on little more than belief: belief in the rightness
of its values; belief in the strength of its system of law and order; belief in its currency;
above all, perhaps, belief in its future.
Once that belief begins to crumble, the collapse of a civilisation may become unstoppable.
That civilisations fall, sooner or later, is as much a law of history as gravity is a law of physics.
What remains after the fall is a wild mixture of cultural debris, confused and angry people whose
certainties have betrayed them, and those forces which were always there, deeper than the foundations
of the city walls: the desire to survive and the desire for meaning."
Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich
Richer By Dean Baker
Introduction: Trading in Myths
In winter 2016, near the peak of Bernie Sanders' bid for the Democratic presidential nomination,
a new line became popular among the nation's policy elite: Bernie Sanders is the enemy of the
world's poor. Their argument was that Sanders, by pushing trade policies to help U.S. workers,
specifically manufacturing workers, risked undermining the well-being of the world's poor because
exporting manufactured goods to the United States and other wealthy countries is their path out
of poverty. The role model was China, which by exporting has largely eliminated extreme poverty
and drastically reduced poverty among its population. Sanders and his supporters would block the
rest of the developing world from following the same course.
This line, in its Sanders-bashing permutation, appeared early on in Vox, the millennial-oriented
media upstart, and was quickly picked up elsewhere (Beauchamp 2016). After all, it was pretty
irresistible. The ally of the downtrodden and enemy of the rich was pushing policies that would
condemn much of the world to poverty.
The story made a nice contribution to preserving the status quo, but it was less valuable if
you respect honesty in public debate.
The problem in the logic of this argument should be apparent to anyone who has taken an introductory
economics course. It assumes that the basic problem of manufacturing workers in the developing
world is the need for someone who will buy their stuff. If people in the United States don't buy
it, then the workers will be out on the street and growth in the developing world will grind to
a halt. In this story, the problem is that we don't have enough people in the world to buy stuff.
In other words, there is a shortage of demand. But is it really true that no one else in the world
would buy the stuff produced by manufacturing workers in the developing world if they couldn't
sell it to consumers in the United States? Suppose people in the developing world bought the stuff
they produced raising their living standards by raising their own consumption.
That is how the economics is supposed to work. In the standard theory, general shortages of
demand are not a problem. Economists have traditionally assumed that economies tended toward full
employment. The basic economic constraint was a lack of supply. The problem was that we couldn't
produce enough goods and services, not that we were producing too much and couldn't find anyone
to buy them. In fact, this is why all the standard models used to analyze trade agreements like
the Trans-Pacific Partnership assume trade doesn't affect total employment. Economies adjust so
that shortages of demand are not a problem.
In this standard story (and the Sanders critics are people who care about textbook economics),
capital flows from slow-growing rich countries, where it is relatively plentiful and so gets a
low rate of return, to fast-growing poor countries, where it is scarce and gets a high rate of
return....
More Jobs, a Strong Economy, and a Threat to Institutions : ...Institutions are significant
to economists, who have come to see that countries become prosperous not because they have bounteous
natural resources or an educated population or the most advanced technology but because they have
good institutions. Crucially, formal structures are supported by informal, often unstated, social
agreements. A nation not only needs courts; its people need to believe that those courts can be
fair. ...
Over most of history, a small élite confiscated wealth from the poor. Subsistence farmers lived
under rules designed to tax them so that the rulers could live in palaces and pay for soldiers
to maintain their power. Every now and then, though, a system appeared in which leaders were forced
to accommodate the needs of at least some of their citizens. ... The societies with the most robust
systems for forcing the powerful to accommodate some of the needs of the powerless became wealthier
and more peaceful. ... Most nations without institutions to check the worst impulses of the rich
and powerful stay stuck in poverty and dysfunction. ...
This year's Presidential election has alarmed economists for several reasons. No economist,
save one , supports Donald J. Trump's stated economic plans, but an even larger concern is
that, were he elected, Trump would attack the very institutions that have provided our economic
stability. In his campaign, Trump has shown outright contempt for courts, free speech, international
treaties, and many other pillars of the American way of life. There is little reason to think
that, if granted the Presidency, Trump would soften his stand. ...
...it's easy to imagine a President Trump refusing to heed our own highest court, which, as
President Andrew Jackson observed, has no way, other than respect of institutions, to enforce
its decisions. No one knows what Trump would do as President, but, based on his statements on
the campaign trail, it's possible to imagine a nation where people have less confidence in the
courts, the military, and their rights to free speech and assembly. When this happens, history
tells us, people stop dreaming about what they could have if they invest in education, new businesses,
and new ideas. They focus, instead, on taking from others and holding tightly to what they've
already amassed. Those societies, without the institutions that protect us from our worst impulses,
become poorer, uglier, more violent. That is how nations fail.
It's easy to carp like this but the sclerotic elite in charge of the country has failed to address
demographic concerns, and has stamped out any politically incorrect thoughts as being signs of
baseness. Now they are so upset that a challenger has arisen. It's unfortunate that this particular
challenger has no background in government and will probably harm our economic growth with his
lack of skill, but the elites will have to eat the cake they baked.
"No one knows what Trump would do as President, but, based on his statements on the campaign trail,
it's possible to imagine a nation where people have less confidence in the courts, the military,
and their rights to free speech and assembly. When this happens, history tells us, people stop
dreaming about what they could have if they invest in education, new businesses, and new ideas.
They focus, instead, on taking from others and holding tightly to what they've already amassed.
Those societies, without the institutions that protect us from our worst impulses, become poorer,
uglier, more violent. That is how nations fail."
This is all true but let's provide a little more context than the totebaggers' paint-by-numbers
narrative.
Economists told us that free trade deals and open borders would make us prosperous and
yet that hasn't happens.
The technicians running trade policy, monetary policy and fiscal policy haven't held up
their end of the bargain.
Wealth and power has been redistributed upwards.
The union movement has been destroyed in outright class war.
The corporate media spread lies and distraction. It induces both apathy and a rat race/dog-eat-dog
mentality.
The Democratic Party has been moved to right as the middle class has struggled.
And more and more people become susceptible to demagogues like Trump as Democrats try to play
both sides of the fence, instead of standing foresquarely behind the job class.
Let's hope we don't find out what Trump does if elected. My guess is that he'd delegate foreign
and domestic policy to Mike Pence as Trump himself would be free to pursue his own personal grudges
via whatever means are available.
As Bernie Sanders's campaign demonstrated, there is still hope. In fact hope is growing.
Lucky for us Sanders campaigned hard for Hillary, knowing what the stakes are.
Given the way people like PGL treated Sanders during the campaign and given what Wikileaks
showed, I doubt the reverse would have been true had Sanders won the primary.
The reverse would have been true, because we Democrats would have voted party above all else and
especially in this election year. Remember "party" the thing that Bernie supporters and Bernie
himself denigrated? I believe the term
"elites" was used more than once to describe the party faithful.
Alex S -> Peter K.... , -1
As we can see here, through leftist glasses, the only possible remedy for solving a problem is
moving left.
Consider how far we've moved right, so that Nixon e.g. would be considered hopelessly and radically
leftist today.
Given that, moving left should be one of the first things you consider.
Does the Right Hold the Economy Hostage to Advance Its Militarist Agenda?
That's one way to read Tyler Cowen's New York Times column * noting that wars have often been
associated with major economic advances which carries the headline "the lack of major wars may
be hurting economic growth." Tyler lays out his central argument:
"It may seem repugnant to find a positive side to war in this regard, but a look at American
history suggests we cannot dismiss the idea so easily. Fundamental innovations such as nuclear
power, the computer and the modern aircraft were all pushed along by an American government eager
to defeat the Axis powers or, later, to win the Cold War. The Internet was initially designed
to help this country withstand a nuclear exchange, and Silicon Valley had its origins with military
contracting, not today's entrepreneurial social media start-ups. The Soviet launch of the Sputnik
satellite spurred American interest in science and technology, to the benefit of later economic
growth."
This is all quite true, but a moment's reflection may give a bit different spin to the story.
There has always been substantial support among liberals for the sort of government sponsored
research that he describes here. The opposition has largely come from the right. However the right
has been willing to go along with such spending in the context of meeting national defense needs.
Its support made these accomplishments possible.
This brings up the suggestion Paul Krugman made a while back (jokingly) that maybe we need
to convince the public that we face a threat from an attack from Mars. Krugman suggested this
as a way to prompt traditional Keynesian stimulus, but perhaps we can also use the threat to promote
an ambitious public investment agenda to bring us the next major set of technological breakthroughs.
1. Baker's peaceful spending scenario is not likely because of human nature.
2. Even if Baker's scenario happened, a given dollar will be used more efficiently in a war.
If there is a threat of losing, you have an incentive to cut waste and spend on what produces
results.
3. The United States would not exist at all if we had not conquered the territory.
US Budgetary Costs of Wars through 2016: $4.79 Trillion and Counting
Summary of Costs of the US Wars in Iraq, Syria, Afghanistan and Pakistan and Homeland Security
By Neta C. Crawford
Summary
Wars cost money before, during and after they occur - as governments prepare for, wage, and
recover from them by replacing equipment, caring for the wounded and repairing the infrastructure
destroyed in the fighting. Although it is rare to have a precise accounting of the costs of war
- especially of long wars - one can get a sense of the rough scale of the costs by surveying the
major categories of spending.
As of August 2016, the US has already appropriated, spent, or taken on obligations to spend
more than $3.6 trillion in current dollars on the wars in Iraq, Afghanistan, Pakistan and Syria
and on Homeland Security (2001 through fiscal year 2016). To this total should be added the approximately
$65 billion in dedicated war spending the Department of Defense and State Department have requested
for the next fiscal year, 2017, along with an additional nearly $32 billion requested for the
Department of Homeland Security in 2017, and estimated spending on veterans in future years. When
those are included, the total US budgetary cost of the wars reaches $4.79 trillion.
But of course, a full accounting of any war's burdens cannot be placed in columns on a ledger....
Yes, we've seen right wing policies killing jobs and steering wealth to the wealthy, and that's
bad policy. But unfortunately it seems it's always possible to do *worse*. Trump's policies would
double down on wealth transfer, while he spouts the typical RW mantra of "(my dopey policy which
would destroy jobs) would be good for jobs." Tim Harford made a good case for trust accounting
for 99% of the difference in per capita GNP between the US and Somalia.
""If you take a broad enough definition of trust, then it would explain basically all the difference
between the per capita income of the United States and Somalia," ventures Steve Knack, a senior
economist at the World Bank who has been studying the economics of trust for over a decade. That
suggests that trust is worth $12.4 trillion dollars a year to the U.S., which, in case you are
wondering, is 99.5% of this country's income (2006 figures). If you make $40,000 a year, then
$200 is down to hard work and $39,800 is down to trust.
How could that be? Trust operates in all sorts of ways, from saving money that would have to
be spent on security to improving the functioning of the political system. But above all, trust
enables people to do business with each other. Doing business is what creates wealth." goo.gl/t3OqHc
Presidents and the US Economy: An Econometric Exploration
By Alan S. Blinder and Mark W. Watson
Abstract
The US economy has performed better when the president of the United States is a Democrat rather
than a Republican, almost regardless of how one measures performance. For many measures, including
real GDP growth (our focus), the performance gap is large and significant. This paper asks why.
The answer is not found in technical time series matters nor in systematically more expansionary
monetary or fiscal policy under Democrats. Rather, it appears that the Democratic edge stems mainly
from more benign oil shocks, superior total factor productivity (TFP) performance, a more favorable
international environment, and perhaps more optimistic consumer expectations about the near-term
future.
Economic growth fueled by foreign oil is nice while it lasts but what will happen to the country
when the oil runs out or we are forced to fight a war that disrupts the supply?
I was in college in the mid 1970's and we asked this question a lot. Some think this worry has
gone away. I don't agree with those types. Which is why a green technology investment drive makes
a lot of sense for so many reasons.
Economic growth fueled by foreign oil is nice while it lasts but what will happen to the country
when the oil runs out or we are forced to fight a war that disrupts the supply?
[ Having read and reread this question, I do not begin to understand what it means. There is
oil here, there is oil all about us, there is oil in Canada and Mexico and on and on, and the
supply of oil about us is not about to be disrupted by any conceivable war and an inconceivable
war is never going to be fought. ]
Economic growth fueled by foreign oil is nice while it lasts but what will happen to the country
when the oil runs out or we are forced to fight a war that disrupts the supply?
[ My guess is that this is a way of scarily pitching for fracking for oil right in my garden,
but I like my azealia bushes and mocking birds. ]
Quote from the paper you linked to: "Arguably, oil shocks have more to do with US foreign policy
than with US economic policy-the two Gulf Wars being prominent examples. That said, several economists
have claimed that US monetary policy played an important role in bringing on the oil shocks. See,
for example, Barsky and Kilian (2002)."
Do We Really Know that Oil Caused the Great Stagflation? A Monetary Alternative
By Robert B. Barsky and Lutz Kilian
Abstract
This paper argues that major oil price increases were not nearly as essential a part of the
causal mechanism that generated the stagflation of the 1970s as is often thought. There is neither
a theoretical presumption that oil supply shocks are stagflationary nor robust empirical evidence
for this view. In contrast, we show that monetary expansions and contractions can generate stagflation
of realistic magnitude even in the absence of supply shocks. Furthermore, monetary fluctuations
help to explain the historical movements of the prices of oil and other commodities, including
the surge in the prices of industrial commodities that preceded the 1973/74 oil price increase.
Thus, they can account for the striking coincidence of major oil price increases and worsening
stagflation.
My quote dragged on too long. I should have ended it with the first sentence. Monetary policy
could play a role but foreign policy could still be the biggest factor.
"Former Fed Vice Chairman Alan Blinder said he's skeptical that fiscal policy will be loosened
a great deal if Clinton wins the election, as seems likely based on recent voter surveys.
"She is promising not to make budget deficits bigger by her programs," said Blinder, who is
now a professor at Princeton University. "Whatever fiscal stimulus there is ought to be small
enough for the Fed practically to ignore it."
PGL told us that Hillary's fiscal program would be YUGE.
Dean Baker in "Rigged" * reminds me of the lasting limits to growth that appear to follow the
sacrifice of growth, especially to the extent of allowing a recession, for the sake of budget
balancing during a time of surrounding economic weakness:
Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich
Richer
By Dean Baker
Introduction: Trading in Myths
In winter 2016, near the peak of Bernie Sanders' bid for the Democratic presidential nomination,
a new line became popular among the nation's policy elite: Bernie Sanders is the enemy of the
world's poor. Their argument was that Sanders, by pushing trade policies to help U.S. workers,
specifically manufacturing workers, risked undermining the well-being of the world's poor because
exporting manufactured goods to the United States and other wealthy countries is their path out
of poverty. The role model was China, which by exporting has largely eliminated extreme poverty
and drastically reduced poverty among its population. Sanders and his supporters would block the
rest of the developing world from following the same course.
This line, in its Sanders-bashing permutation, appeared early on in Vox, the millennial-oriented
media upstart, and was quickly picked up elsewhere (Beauchamp 2016). After all, it was pretty
irresistible. The ally of the downtrodden and enemy of the rich was pushing policies that would
condemn much of the world to poverty.
The story made a nice contribution to preserving the status quo, but it was less valuable if
you respect honesty in public debate.
The problem in the logic of this argument should be apparent to anyone who has taken an introductory
economics course. It assumes that the basic problem of manufacturing workers in the developing
world is the need for someone who will buy their stuff. If people in the United States don't buy
it, then the workers will be out on the street and growth in the developing world will grind to
a halt. In this story, the problem is that we don't have enough people in the world to buy stuff.
In other words, there is a shortage of demand. But is it really true that no one else in the world
would buy the stuff produced by manufacturing workers in the developing world if they couldn't
sell it to consumers in the United States? Suppose people in the developing world bought the stuff
they produced raising their living standards by raising their own consumption.
That is how the economics is supposed to work. In the standard theory, general shortages of
demand are not a problem. Economists have traditionally assumed that economies tended toward full
employment. The basic economic constraint was a lack of supply. The problem was that we couldn't
produce enough goods and services, not that we were producing too much and couldn't find anyone
to buy them. In fact, this is why all the standard models used to analyze trade agreements like
the Trans-Pacific Partnership assume trade doesn't affect total employment. Economies adjust so
that shortages of demand are not a problem.
In this standard story (and the Sanders critics are people who care about textbook economics),
capital flows from slow-growing rich countries, where it is relatively plentiful and so gets a
low rate of return, to fast-growing poor countries, where it is scarce and gets a high rate of
return....
It is yuuuuge - and no I did not say anything of the sort. Rather I noted it would be less than
1% of GDP. This is what I get for trying to get the facts right. It gets too complicated for you
even when we simplify things so you get angry and start screaming "liar". Grow up.
Per capta GDP grew from $51,100 to $51,400 between July 1 2015 and July 1 2016. This 0.6% growth
does not seem to me to be a statistic supporting claims of improving employment and improving
wage growth.
Dean has suggested in one of his commentaries that wage growth may be an artifact of a decline
in the quality of health insurance coverage. Wage growth is not figured net of increased outlays
for deductibles and copays related to changes in health insurance. PPACA discourages low deductible
and low copay health plans by placing a "Cadillac tax" on them, or at least threatening to do
so. The consequent rise in wage workers' outlays for copays and deductibles are not captured in
the statistics that claim to measure wage gains. This results in an income transfer from the well
to the sick, but can produce statistics that can be interpreted in politically convenient ways
by those so inclined
I get why the plans are taxed. I don't believe that the results of that policy have been beneficial
for the bulk of the population. Most of the good done by PPACA was done by the expansion of Medicaid
eligibility. I believe that requiring the working poor people to settle for high deductible high
copay policies has had the practical effect of requiring them to choose between adequate medical
and further impoverishment. I do not believe that the PPACA could not have been financed in a
way less injurious to the working poor. As the insurers have been unable to make money in this
deal, the hospital operators seem to have been the only winners in that their bad debt problems
have been ameliorated.
"people stop dreaming about what they could have if they invest in education, new businesses,
and new ideas"
And this is entirely rational, as in the situation described, the fruits of their efforts will
likely be siphoned from their pockets by the elites and generally rent-seekers with higher social
standing and leverage, or at best their efforts will amount to too little to be worth the risk
(including the risk of wasting one's time i.e. opportunity cost). It also becomes correspondingly
harder to convince and motivate others to join or fund any worthwhile efforts. What also happens
(and has happened in "communism") is that people take their interests private, i.e. hidden from
the view of those who would usurp or derail them.
"Those who witness extreme social collapse at first hand seldom describe any deep revelation about
the truths of human existence. What they do mention, if asked, is their surprise at how easy it
is to die.
The pattern of ordinary life, in which so much stays the same from one day to the next, disguises
the fragility of its fabric. How many of our activities are made possible by the impression of
stability that pattern gives? So long as it repeats, or varies steadily enough, we are able to
plan for tomorrow as if all the things we rely on and don't think about too carefully will still
be there. When the pattern is broken, by civil war or natural disaster or the smaller-scale tragedies
that tear at its fabric, many of those activities become impossible or meaningless, while simply
meeting needs we once took for granted may occupy much of our lives.
What war correspondents and relief workers report is not only the fragility of the fabric,
but the speed with which it can unravel. As we write this, no one can say with certainty where
the unraveling of the financial and commercial fabric of our economies will end. Meanwhile, beyond
the cities, unchecked industrial exploitation frays the material basis of life in many parts of
the world, and pulls at the ecological systems which sustain it.
Precarious as this moment may be, however, an awareness of the fragility of what we call civilisation
is nothing new.
'Few men realise,' wrote Joseph Conrad in 1896, 'that their life, the very essence of their
character, their capabilities and their audacities, are only the expression of their belief in
the safety of their surroundings.' Conrad's writings exposed the civilisation exported by European
imperialists to be little more than a comforting illusion, not only in the dark, unconquerable
heart of Africa, but in the whited sepulchres of their capital cities. The inhabitants of that
civilisation believed 'blindly in the irresistible force of its institutions and its morals, in
the power of its police and of its opinion,' but their confidence could be maintained only by
the seeming solidity of the crowd of like-minded believers surrounding them. Outside the walls,
the wild remained as close to the surface as blood under skin, though the city-dweller was no
longer equipped to face it directly.
Bertrand Russell caught this vein in Conrad's worldview, suggesting that the novelist 'thought
of civilised and morally tolerable human life as a dangerous walk on a thin crust of barely cooled
lava which at any moment might break and let the unwary sink into fiery depths.' What both Russell
and Conrad were getting at was a simple fact which any historian could confirm: human civilisation
is an intensely fragile construction. It is built on little more than belief: belief in the rightness
of its values; belief in the strength of its system of law and order; belief in its currency;
above all, perhaps, belief in its future.
Once that belief begins to crumble, the collapse of a civilisation may become unstoppable.
That civilisations fall, sooner or later, is as much a law of history as gravity is a law of physics.
What remains after the fall is a wild mixture of cultural debris, confused and angry people whose
certainties have betrayed them, and those forces which were always there, deeper than the foundations
of the city walls: the desire to survive and the desire for meaning."
"... An awful lot of people out there think we live in a one-party state-that we're ruled by what is coming to be called the "Uniparty." ..."
"... There is a dawning realization, ever more widespread among ordinary Americans, that our national politics is not Left versus Right or Republican versus Democrat; it's we the people versus the politicians. ..."
"... Donald Trump is no nut. If he were a nut, he would not have amassed the fortune he has, nor nurtured the capable and affectionate family he has. ..."
"... To be conservative, then, is to prefer the familiar to the unknown, to prefer the tried to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the near to the distant, the sufficient to the superabundant, the convenient to the perfect, present laughter to utopian bliss. ..."
"... Trump has all the right instincts. And he's had the guts and courage-and, just as important, the money -to do a thing that has badly needed doing for twenty years: to smash the power of the real nuts in the GOP Establishment. ..."
A couple of remarks in
Professor Susan
McWillams' recent Modern Age piece celebrating the 25th anniversary of Christopher Lasch's
1991 book
The True and Only Heaven , which analyzed the cult of progress in its American manifestation,
have stuck in my mind. Here's the first one:
McWilliams adds a footnote to that: The 19 percent figure is from 2012, she says. Then she tells
us that in 1964, 64 percent of Americans agreed with the same statement.
Wow. You have to think that those two numbers, from 64 percent down to 19 percent in two generations,
tell us something important and disturbing about our political life.
Second McWilliams quote:
In 2016 if you type the words "Democrats and Republicans" or "Republicans and Democrats" into
Google, the algorithms predict your next words will be "are the same".
I just tried this, and she's right. These guesses are of course based on the frequency with which
complete sentences show up all over the internet. An awful lot of people out there think we live
in a one-party state-that we're ruled by what is
coming to be called the "Uniparty."
There is a dawning realization, ever more widespread among ordinary Americans, that our national
politics is not Left versus Right or Republican versus Democrat; it's we the people
versus the politicians.
Which leads me to a different lady commentator: Peggy Noonan, in her October 20th Wall Street
Journal column.
The title of Peggy's piece was:
Imagine
a Sane Donald Trump . [
Alternate link ]Its gravamen:
Donald Trump has shown up the Republican Party Establishment as totally out of touch with their base,
which is good; but that he's bat-poop crazy, which is bad. If a sane Donald Trump had done
the good thing, the showing-up, we'd be on course to a major beneficial correction in our national
politics.
It's a good clever piece. A couple of months ago on Radio Derb I offered up one and a half cheers
for Peggy, who gets a lot right in spite of being a longtime Establishment Insider. So it
was here. Sample of what she got right last week:
Mr. Trump's great historical role was to reveal to the Republican Party what half of its
own base really thinks about the big issues. The party's leaders didn't know! They were shocked,
so much that they indulged in sheer denial and made believe it wasn't happening.
The party's leaders accept more or less open borders and like big trade deals. Half the base
does not! It is longtime GOP doctrine to cut entitlement spending. Half the base doesn't want
to, not right now! Republican leaders have what might be called assertive foreign-policy impulses.
When Mr. Trump insulted George W. Bush and nation-building and said he'd opposed the Iraq invasion,
the crowds, taking him at his word, cheered. He was, as they say, declaring that he didn't want
to invade the world and invite the world. Not only did half the base cheer him, at least half
the remaining half joined in when the primaries ended.
End of pause. OK, so Peggy got some things right there. She got a lot wrong, though
Start with the notion that Trump is crazy. He's a nut, she says, five times. His brain is "a TV
funhouse."
Well, Trump has some colorful quirks of personality, to be sure, as we all do. But he's no nut.
A nut can't be as successful in business as Trump has been.
I spent 32 years as an employee or contractor, mostly in private businesses but for two years
in a government department. Private businesses are intensely rational, as human affairs go-much more
rational than government departments. The price of irrationality in business is immediate and plainly
financial. Sanity-wise, Trump is a better bet than most people in high government positions.
Sure, politicians talk a good rational game. They present as sober and thoughtful on the Sunday
morning shows.
Look at the stuff they believe, though. Was it rational to respond to the collapse of the U.S.S.R.
by moving NATO right up to Russia's borders? Was it rational to expect that post-Saddam Iraq would
turn into a constitutional democracy? Was it rational to order insurance companies to sell healthcare
policies to people who are already sick? Was the Vietnam War a rational enterprise? Was it rational
to respond to the 9/11 attacks by massively increasing Muslim immigration?
Make your own list.
Donald Trump displays good healthy patriotic instincts. I'll take that, with the personality quirks
and all, over some earnest, careful, sober-sided guy whose head contains fantasies of putting the
world to rights, or flooding our country with unassimilable foreigners.
I'd add the point, made by many commentators, that belongs under the general heading: "You don't
have to be crazy to work here, but it helps." If Donald Trump was not so very different from run-of-the-mill
politicians-which I suspect is a big part of what Peggy means by calling him a nut-would he have
entered into the political adventure he's on?
Thor Heyerdahl sailed across the Pacific on a hand-built wooden raft to prove a point, which
is not the kind of thing your average ethnographer would do. Was he crazy? No, he wasn't. It was
only that some feature of his personality drove him to use that way to prove the point he
hoped to prove.
And then there is Peggy's assertion that the Republican Party's leaders didn't know that half
the party's base were at odds with them.
Did they really not? Didn't they get a clue when the GOP lost in 2012, mainly because millions
of Republican voters didn't turn out for Mitt Romney? Didn't they, come to think of it, get the glimmering
of a clue back in 1996, when Pat Buchanan won the New Hampshire primary?
Pat Buchanan is in fact a living counter-argument to Peggy's thesis-the "sane Donald Trump" that
she claims would win the hearts of GOP managers. Pat is Trump without the personality quirks. How
has the Republican Party treated him ?
Our own
Brad Griffin , here at VDARE.com on October 24th, offered a couple more "sane Donald Trumps":
Ron Paul and Mike Huckabee. How did they fare with the GOP Establishment?
Donald Trump is no nut. If he were a nut, he would not have amassed the fortune he
has, nor nurtured the capable and affectionate family he has. Probably he's less well-informed
about the world than the average pol. I doubt he could tell you what
the capital of Burkina Faso is. That's secondary, though. A President has people to look up that
stuff for him. The question that's been asked more than any other about Donald Trump is not, pace
Peggy Noonan, "Is he nuts?" but, "
Is he conservative? "
I'm sure he is. But my definition of "conservative" is temperamental, not political. My touchstone
here is the sketch of the conservative temperament given to us by the English political philosopher
Michael Oakeshott :
To be conservative, then, is to prefer the familiar to the unknown, to prefer the tried
to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the
near to the distant, the sufficient to the superabundant, the convenient to the perfect, present
laughter to utopian bliss.
That fits Trump better than it fits any liberal you can think of-better also than many senior
Republicans.
For example, it was one of George W. Bush's senior associates-probably Karl Rove-who scoffed at opponents
of Bush's delusional foreign policy as "the reality-based community." It would be hard to think of
a more un -Oakeshottian turn of phrase.
Trump has all the right instincts. And he's had the guts and courage-and, just as important,
the money -to do a thing that has badly needed doing for twenty years: to smash the power
of the real nuts in the GOP Establishment.
I thank him for that, and look forward to his Presidency.
"... I'll be interested to see how much Hillary tries to "work with Republicans" when it comes to foreign or domestic policy, as she's promising on the campaign trail. ..."
"... In a recent interview Biden was talking about how his "friends" in the Senate like McCain, Lindsy Graham, etc. - the sane ones who hate Trump - have to come out in support of the Republican plan to block Clinton from nominating a Supreme Court judge, because of if they don't, the Koch brothers will primary them. ..."
"... While I agree that the Republican party has been interested in whatever argument will win elections and benefit their donor class, doesn't the Democratic Party also have a donor class? Haven't Bill Clinton, Barack Obama, and Hillary Clinton had a close relationship with some business interests? Did anyone go to jail after the asset bubble? Did welfare reform work or simply shift the problem out of view? How complicit are the Democrats in the great risk shift? ..."
"... I would think the scorched earth politics of the neoliberals required Democrats to shift to the right if they ever hoped to win an election, again. That is what it has looked like to me. The American equivalent of New Labor in Britain. So, we have a more moderate business-interest group of Democrats and a radical business-interest group of Republicans during the past 40 years. I think Kevin Phillips has made this argument. ..."
"... Our grand experimental shift back to classical theory involved supply side tax cuts, deregulation based on the magic of new finance theory, and monetarist pro-financial monetary policy. All of which gave us the masquerade of a great moderation that ended in the mother of all asset bubbles. While we shredded the safety net. ..."
"... Now the population is learning the arguments about free trade magically lifting all boats up into the capitalist paradise has blown up. We've shifted the risk onto the working population and they couldn't bear it. ..."
"... Economists lied to the American people about trade and continue to lie about the issue day in and day out. Brainwashing kids with a silly model called comparative advantage. ..."
This is all true but Krugman always fails to tell the other side of the story.
I'll be interested to see how much Hillary tries to "work with Republicans" when it comes
to foreign or domestic policy, as she's promising on the campaign trail.
The centrists always do this to push through centrist, neoliberal "solutions" which anger the
left.
In a recent interview Biden was talking about how his "friends" in the Senate like McCain,
Lindsy Graham, etc. - the sane ones who hate Trump - have to come out in support of the Republican
plan to block Clinton from nominating a Supreme Court judge, because of if they don't, the Koch
brothers will primary them.
Let's hope Hillary does something about campaign finance reform and Citizen United and takes
a harder line against obstructionist Republicans.
While I agree that the Republican party has been interested in whatever argument will win
elections and benefit their donor class, doesn't the Democratic Party also have a donor class?
Haven't Bill Clinton, Barack Obama, and Hillary Clinton had a close relationship with some business
interests? Did anyone go to jail after the asset bubble? Did welfare reform work or simply shift
the problem out of view? How complicit are the Democrats in the great risk shift?
I would think the scorched earth politics of the neoliberals required Democrats to shift
to the right if they ever hoped to win an election, again. That is what it has looked like to
me. The American equivalent of New Labor in Britain. So, we have a more moderate business-interest
group of Democrats and a radical business-interest group of Republicans during the past 40 years.
I think Kevin Phillips has made this argument.
Our grand experimental shift back to classical theory involved supply side tax cuts, deregulation
based on the magic of new finance theory, and monetarist pro-financial monetary policy. All of
which gave us the masquerade of a great moderation that ended in the mother of all asset bubbles.
While we shredded the safety net.
Now the population is learning the arguments about free trade magically lifting all boats
up into the capitalist paradise has blown up. We've shifted the risk onto the working population
and they couldn't bear it.
Perhaps the less partisan take-way would be - is it possible for any political candidate to
get elected in this environment without bowing to the proper interests? How close did Bernie get?
And, how do we fix it without first admitting that the policies of both political parties have
not really addressed the social adjustments necessary to capture the benefits of globalization?
We need an evolution of both political parties - not just the Republicans. If we don't get it,
we can expect the Trump argument to take even deeper root.
Economists lied to the American people about trade and continue to lie about the issue day
in and day out. Brainwashing kids with a silly model called comparative advantage. East Asian
economists including Ha Joon Chang among others debunked comparative advantage and Ricardianism
long ago.
Manufacturing is everything. It is all that matters. We needed tariffs yesterday. Without them
the country is lost.
"... Among the more prominent exchanges released in the latest, 27th, Wikileaks release of Podesta emails is a thread from March 2016 which discusses a Politico article tilted " Clintonites: How we beat Bernie on trade ", and which reports that " Clinton faced internal pressure from her Brooklyn headquarters to oppose the Trans-Pacific Partnership trade deal she helped craft as secretary of State ." ..."
Among the more prominent exchanges released in the latest, 27th, Wikileaks release of Podesta
emails is a thread from
March 2016 which discusses a Politico article tilted "
Clintonites: How we beat Bernie on trade ", and which reports that " Clinton faced internal pressure
from her Brooklyn headquarters to oppose the Trans-Pacific Partnership trade deal she helped craft
as secretary of State ."
Senior Clinton strategist, Joel Benenson, is quoted in the piece as saying:
"Voters agree that we have to compete and win in a global economy and that means we have to
make things in the United States that we can sell to 95 percent of the world's consumers who happen
to live outside of the United States. What the data from the exit polls says is these voters were
more aligned with her fundamental view of trade ."
* * *
Clinton instead pushed back on Sanders' opposition to the Export-Import Bank, and doubled down
on the idea that America needs to compete and win in the global economy.
"We engaged with him on trade more forcefully," Benenson said. In the end, " I guess he came
off as an economic isolationist."
The article prompted Gene Sperling, former economic policy assistant to both Bill Clinton and
Obama to say:
" Do not get our spin here. Why we not hyping claw back, ROO, out front on steel, tough enforcement
on China?! Was this just her not talking to any of us and off on her own take?(But Joel is in
there ) please clarify."
To which, a clearly angry Tanden replies:
"Is Joel off reservation? Does he not get that this story makes Hillary seem politically craven
at best or a liar at worse? Or if this is campaign position, can I object ?"
She then adds: " Hard to say she believes what she says when Joel is spinning that she doesn't
mean what she is out there saying. Her language was pretty tough last week. "
Finally, she concludes that " Sanders or trump can move on this. "
"... The international community considers backroom corporate trade deals as one example of the general problem of fragmentation. The US government tries to end-run the UN Charter with NATO. It tries to end-run ILO conventions with the WTO. It tries to end-run economic and social rights with ISDS. It tries to end-run sovereign debt principles (e.g. A/69/L.84) with the Paris Club and the IMF. In response, the international community has been working to synthesize the different legal regimes in an objective way. ..."
"... Corporate special pleading gets subsumed in old-time diplomacy, finding common ground, so the pitched-battle narrative is absent, but when Zayas comes out and says ISDS cannot negate human rights, this is the context. They're trying to preserve a non-hierarchical regime in which the only absolute is the purposes and principles of the UN: peace and development, which comes down to human rights. ..."
The international community considers backroom corporate trade deals as one example of
the general problem of fragmentation. The US government tries to end-run the UN Charter with NATO.
It tries to end-run ILO conventions with the WTO. It tries to end-run economic and social rights
with ISDS. It tries to end-run sovereign debt principles (e.g. A/69/L.84) with the Paris Club
and the IMF. In response, the international community has been working to synthesize the different
legal regimes in an objective way.
Corporate special pleading gets subsumed in old-time diplomacy, finding common ground,
so the pitched-battle narrative is absent, but when Zayas comes out and says ISDS cannot negate
human rights, this is the context. They're trying to preserve a non-hierarchical regime in which
the only absolute is the purposes and principles of the UN: peace and development, which comes
down to human rights.
CETA: "EU's Canada free-trade CETA deal could be back on as Walloons agree to last-minute deal"
[
Telegraph
].
"Belgium's Prime Minister Charles Michel said that Wallonia was now in agreement, and the regional
parliaments may now agree to CETA by the end of Friday night, opening the door to the deal being
signed. Mr Tusk said that once the regional votes had taken place, he will inform Canadian Prime
Minister Justin Trudeau. Any extra concessions given to Wallonia may mean other countries will want
to look again at the deal, however." (The BBC's headline, then -
"EU-Canada trade deal: Belgians break Ceta deadlock"
- is quite irresponsible. As is–
CETA: "Belgium breaks Ceta deadlock" [
EUObserver
].
Not quite:
Belgium's political entities agreed to a declaration on Thursday (26 October), which gives
their government a green light to sign Ceta, the EU-Canada trade pact.
The agreement was promptly sent to EU ambassadors in Brussels, to be discussed later in the
afternoon.
After a week of marathon negotiations, Belgian prime minister Charles Michel said that Thursday's
talks had calmed "outstanding concerns".
As part of the trade-off, Belgium will ask the European Court of Justice to clarify the proposed
investment court system, which was one of the most controversial elements of the trade deal.
Ceta was due to be signed off by EU leaders and Canada's prime minister Justin Trudeau at a
summit in Brussels on Thursday. Trudeau cancelled the trip during the night as no agreement had
been reached in Brussels.
It's not known when the summit will take place, or whether the Belgian go-ahead was the last
hurdle.
The other 27 EU countries must first accept the Belgian deal.
At their meeting on Thursday, EU ambassadors will be accompanied by lawyers and representatives
of the EU institutions, who will examine the legality and consequences of the text.
The Walloon parliament will vote on the agreement on Friday.
Still, how do we slay these undead deals? The same thing happened with TPP.
CETA: "The great CETA swindle" [
Corporate
Europe Observatory
]. "The latest PR move is a "joint interpretative declaration" on the trade
deal hammered out by Ottawa and Brussels and published by investigative journalist collective Correctiv
last Friday. It is designed to alleviate public concerns but in fact does nothing to fix CETA's flaws.
In September, Canada's Trade Minister, Chrystia Freeland, and her German counterpart, Sigmar Gabriel,
had announced such a text to appease Social Democrats, trade unions and the wider public who fear
that CETA would threaten public services, labour and environmental standards and undermine governments'
right to regulate in the public interest. Several governments, notably Austria, had linked their
'yes' to CETA to the declaration. [But] According to environmental group Greenpeace, the declaration
therefore has the 'legal weight of a holiday brochure'."
Legal experts have also warned that the declaration "could be misleading for non-lawyers, who
might think that the Declaration will alter or override the CETA". But it does not change CETA's
legal terms – and it is these terms which have raised concerns. As Canadian law Professor Gus
van Harten explains: "Based on principles of treaty interpretation, the CETA will be interpreted
primarily according to the text of its relevant provisions…. The Declaration would play a subsidiary
role, if any, in this interpretative process." In other words, legally (and thus politically),
the CETA text is far more important than the declaration – and the former could prevail over the
latter in case of a conflictive interpretation.
The post then goes on to analyze the provisions of the declaration in detail, comparing them to
the text. (Readers may remember that
TPP advocates have made the same sort of claim for the TPP Preamble, which the text also over-rides
.
So, the Belgians are smart to get a court ruling on this. And we might also expect the adminsitration
to use similar tactics to (the toothless distraction of) the CETA "resolution" in the upcoming attempt
to pass the TPP.
"Belgian officials were discussing a working document aimed at addressing Wallonia's concerns
on the trade deal. The document, published by Belgian state media RTBF, shows that Belgium is moving
toward requesting additional safeguards for the agricultural sector 'in cases of market turbulence.'
It also puts forward a number of requests regarding the investor court system, including 'progressing
towards hiring judges on a permanent basis'" [
Politico
].
This seems to be a
different
document from the "declaration"; it was leaked by a different
source.
Here is is; it's in French
.
TPP: "Eight major financial services industry associations made an appeal to congressional leaders
to support passage of the TPP this year, arguing that the deal is 'vital to ensuring that the U.S.
financial services sector remains a vibrant engine for domestic and global growth'" [
Politico
].
What the heck is a "vibrant engine"? Maybe a screw loose or something? Needs a tightening to stop
the shaking and shimmying?
TPP: "Health, labor and consumer groups are warning President Barack Obama to refrain from including
a 12-year monopoly period for biological drugs in legislation to implement the TPP as a means for
addressing congressional concerns over the pact. The groups argue that such a move could undermine
future efforts to shorten that protection period under U.S. law" [
Politico
].
"The letter, signed by Doctors Without Borders, the AFL-CIO, AARP, Oxfam and Consumers Union, also
expresses concern over reports that the administration is prepared to negotiate side letters with
TPP countries to reinforce U.S. lawmaker demands that countries respect a 12-year protection period,
which reflects U.S. law."
"The case against free trade – Part 1" [
Bill
Mitchell
].
"... Any analysis that starts with the assumption reactionaries still has a great deal to its agenda to achieve, such as promoting regressive taxation; privatization of Social Security; limiting Medicare; privatization of education; expansion of the police state; using the military to support the dollar, banking, world markets, etc., rather than Corey Robin's belief that "the Right" has won is in my view an improvement on the OP. ..."
"... In the end, Putin will be done in by his oligarchs, despite the care he has taken to give them their share if they just refrain from wrecking everything with their excesses. Again, no need for NGOs. ..."
This is a very good analyses. But I am less pessimistic: the blowback against neoliberal globalization
is real and it is difficult to swipe it under the carpet.
There are some signs of the "revolutionary situation" in the USA in a sense that the neoliberal
elite lost control and their propaganda loss effectiveness, despite dusting off the "Red scare"
trick with "Reds in each computer" instead of "Reds under each bed". With Putin as a very convenient
bogeyman.
As somebody here said Trump might be a reaction of secular stagnation, kind of trump card put
into play by some part of the elite, because with continued secular stagnation, the social stability
in the USA is under real threat.
But the problem is that Hillary with her failing health is our of her prime and with a bunch
of neocons in key positions in her administration, she really represents a huge threat to world
peace. She might not last long as the level of stress inherent in POTUS job make it a killing
ground for anybody with advanced stage of Parkinson or similar degenerative neurological disease.
But that might make her more impulsive and more aggressive (and she always tried to outdo male
politicians in jingoism, real John McCain is the red pantsuit).
All-in-all it looks like she in not a solution for neoliberal elite problems, she is a part
of the problem
Adventurism of the US neoliberal elite, and especially possible aggressive moves in Syria by
Hillary regime ("no fly zone"), makes military alliance of Russia and China very likely (with
Pakistan, Iran and India as possible future members). So Hillary might really work like a powerful
China lobbyist, because the alliance with Russia will be on China terms.
Regime change via color revolution in either country requires at dense network of subservient
to the Western interests and financed via shadow channels MSM (including TV channels), strong
network of NGO and ability to distribute cash to selected members of the fifth column of neoliberal
globalization. All those condition were made more difficult in Russia and impossible in mainland
China. In Russia the US adventurism in Ukraine and the regime change of February 2014 (creation
of neo-fascist regime nicknamed by some "Kaganat of Nuland" (Asia Times
http://www.atimes.com/atimes/Central_Asia/CEN-01-100315.html
)) essentially killed the neoliberal fifth column in Russia and IMHO it no longer represent
a viable political force.
Also Russians probably learned well lesson of unsuccessful attempt of regime change by interfering
into Russian Presidential election process attempted by Hillary and Obama in 2011-2012. I would
like to see the US MSM reaction if Russian ambassador invited Sanders and Trump into the embassy
and promised full and unconditional support for their effort to remove criminal Obama regime,
mired in corruption and subservient to Wall Street interests, the regime that produced misery
for so many American workers, lower middle class and older Americans ;-)
Ambassador McFaul soon left the country, NED was banned and screws were tightened enough to
make next attempt exceedingly difficult. Although everything can happen I would discount the possibility
of the next "White Revolution" in Russia. So called "Putin regime" survived the period of low
oil prices and with oil prices over $60 in 2017 Russian economy might be able to grow several
percent a year. At the same time the US "post-Obama" regime might well face the winds of returning
higher oil prices and their negative influence of economy growth and unemployment.
In China recent troubles in Hong Cong were also a perfect training ground for "anti color revolution"
measures and the next attempt would much more difficult, unless China experience economic destabilization
due to some bubble burst.
That means that excessive military adventurism inherent in the future Hillary regime might
speed up loss by the USA military dominance and re-alignment of some states beyond Philippines.
Angela Merkel regime also might not survive the next election and that event might change "pro-Atlantic"
balance in Europe.
Although the list in definitely not complete, we can see that there are distinct setbacks for
attempts of further neoliberalization beyond Brexit and TPP troubles.
So there are some countervailing forces in action and my impression that the Triumphal march
of neoliberalism with the USA as the hegemon of the new neoliberal order is either over, or soon
will be over. In certain regions of the globe the USA foreign policy is in trouble (Syria, Ukraine)
and while you can do anything using bayonets, you can't sit on them.
So while still there is no viable alternative to neoliberalism as a social system, the ideology
itself is discredited and like communism after 1945 lost its hold of hearts and minds of the USA
population. I would say that in the USA neoliberalism entered Zombie stage.
My hope is that reasonable voices in foreign policy prevail, and the disgust of unions members
toward DemoRats (Neoliberal Democrats) could play the decisive role in coming elections. As bad
as Trump is for domestic policy, it represent some hope as for foreign policy unless co-opted
by Republican establishment.
#70 But the problem is that Hillary with her failing health is our of her prime and with a bunch
of neocons in key positions in her administration, she really represents a huge threat to world
peace. She might not last long as the level of stress inherent in POTUS job make it a killing
ground for anybody with advanced stage of Parkinson or similar degenerative neurological disease.
But that might kale her more impulsive and more aggressive (and she always tried to outdo her
male politicians in jingoism, real John McCain is the red pantsuit).
Does the new CT moderation regime have any expectations about the veracity of claims made by
commenters? Because I think it would be useful in cases like this.
Yes, it was late and I was tired, or I wouldn't have said something so foolish. Still, the
point is that after centuries of constant war, Europe went 70 years without territorial conquest.
That strikes me as a significant achievement, and one whose breach should not be taken lightly.
phenomenal cat @64
So democratic structures have to be robust and transparent before we care about them? I'd give
a pretty high value to an independent press and contested elections. Those have been slowly crushed
in Russia. The results for transparency have not been great. Personally, I don't believe that
Ukraine is governed by fascists, or that Ukraine shot down that jetliner, but I'm sure a lot of
Russians do.
Russian leaders have always complained about "encirclement," but we don't have to believe them.
Do you really believe Russia's afraid of an attack from Estonia? Clearly what Putin wants is to
restore as much of the old Soviet empire as possible. Do you think the independence of the Baltic
states would be more secure or less secure if they weren't members of NATO? (Hint: compare to
Ukraine, Georgia, Moldova.)
' .makes military alliance of Russia and China very likely '
Any analysis which arrives at this conclusion is profoundly ignorant.
Meta-comment: Is it permitted to say that a moderation scheme which objects to engels as a
troll, while permitting this tripe from likbez has taken a wrong turn somewhere. Seriously, some
explanation called for.
Does the new CT moderation regime have any expectations about the veracity of claims made
by commenters? Because I think it would be useful in cases like this.
I would like to apologize about the number of typos, but I stand by statements made. Your implicit
assumption that I am lying was not specific, so let's concentrate on three claims made:
1. "Hillary has serious neurological disease for at least four years", 2. "Obama and Hillary tried to stage color revolution in Russia in 2011-2012 interfering in Russian
Presidential elections" 3. "Hillary Clinton is a neocon, a warmonger similar to John McCain"
1. Hillary Health : Whether she suffers from Parkinson disease or not in unclear, but signs
of some serious neurological disease are observable since 2012 (for four years). Parkinson is just
the most plausible hypothesis based on symptoms observed. Those symptoms suggests that she is at
Stage 2 of the disease due to an excellent treatment she gets:
http://www.viartis.net/parkinsons.disease/news/100312.htm
The average time taken to progress from Stage 1 (mild) to Stage 2 (mild but various symptoms)
was 1 year 8 months. The average time taken to progress from Stage 2 to Stage 3 (typical) was
7 years and 3 months. From Stage 3 to Stage 4 (severe) took 2 years. From Stage 4 to Stage 5 (incapacitated)
took 2 years and 2 months. So the stage with typical symptoms lasts the longest. Those factors
associated with faster progression were older age at diagnosis, and longer disease duration. Gender
and ethnicity were not associated with the rate of Parkinson's Disease progression.
These figures are only averages. Progression is not inevitable. Some people with Parkinson's
Disease have either : stayed the same for decades, reduced their symptoms, rid their symptoms,
or worsened at a rapid rate. For more current news go to Parkinson's Disease News.
Concern about Hillary health were voiced in many publications and signs of her neurological disease
are undisputable:
3. The opinion that Hillary as a neocon is supported by facts from all her career , but
especially during her tenure as the Secretary of State. She voted for Iraq war and was instrumental
in unleashing Libya war and Syria war. The amount of evidence can't be ignored:
If you have more specific concerns please voice them and I will try to support my statements with
references and known facts.
stevenjohnson 10.26.16 at 1:50 pm
likbez @70 Any analysis that starts with the assumption reactionaries still has a great
deal to its agenda to achieve, such as promoting regressive taxation; privatization of Social
Security; limiting Medicare; privatization of education; expansion of the police state; using
the military to support the dollar, banking, world markets, etc., rather than Corey Robin's
belief that "the Right" has won is in my view an improvement on the OP. But whether mine
is actually a deep analysis seems doubtful even to me.
But the OP is really limiting itself solely to domestic politics, and in that context the
resistance to "neoliberal globalization," (Why not use the term "imperialism?") is more or
less irrelevant. The OP seems to have some essentialist notion of the "Right" as openly aimed
at restoring the past, ignoring the content of policies. Reaction would be something blatant
like restoring censorship of TV and movies, instead of IP laws that favor giant
telecommunications companies, or abolition of divorce, instead of discriminatory enforcement
of child protection laws that break up poor families. This
cultural/psychological/moralizing/spiritual approach seems to me to be fundamentally a
diversion from a useful understanding.
There may be some sort of confused notions about popular morals and tastes clearly evolving
in a more leftish direction. Free love was never a conservative principle for instance, yet
many of its tenets are now those of the majority of the population. Personally I can only
observe that there's nothing quite like the usefulness of laws and law enforcement,
supplemented by the occasional illicit violence, to change social attitudes. The great model
of course is the de facto extermination of the Left by "McCarthyism." No doubt the
disappearance of the left targeted by "McCarthyism" is perceived to be a purification of the
real left. It is customary for the acceptable "left" to agree with the McCarthys that
communism lost its appeal to the people, rather than being driven out by mass repression. As
to populism, such reactionary goals as the abolition of public education are notoriously sold
as service to the people against the hifalutin' snobs, starting of course with lazy ass
teachers. It seems to me entirely mistaken to see the populist reactionaries as out of
ammunition because the old forms of race-baiting aren't working so well.
By the way, there already is a Chinese bourgeoisie, in Taiwan, Singapore, the Philippines,
Malaysia, Indonesia, Hong Kong, as well as elements in SEZs in China proper and select circles
in various financial capitals. Restoration of capitalism in China has run into the difficulty
that capitalism isn't holding up its end. President Xi Jinping is finding it difficult for
capitalism to keep the mainland economy growing at a sufficiently rapid rate to keep the
working class pacific, much less generate the so-called middle class whose stock market
portfolios will bind them to the new ruling class forever. These are the sources for a
revolution in China, not NGOs or a color revolution. In the end, Putin will be done in by
his oligarchs, despite the care he has taken to give them their share if they just refrain
from wrecking everything with their excesses. Again, no need for NGOs.
Val @72 I remember that there were only rare, vague hints about Reagan, not factual
evidence. So unless you are committed to the proposition his Alzheimer's disease only set in
January 21, 1992, demanding factual evidence about the mental and physical health of our
elective divinities seems unduly restrictive I think.
Layman @79 The Shanghai Cooperation Organization alone makes an analysis that a military
alliance between Russia and China reasonable enough. Even if incorrect in the end, it is not
"profoundly ignorant."
Meta-comment: Engels post was perceived as mocking, which was its offense. As for "trolling,"
that's an internet thing...
"... Geithner's comments about his sacrifices in public service did not elicit any outcry from the media at the time because his perspective was widely shared. The implicit assumption is that the sort of person who is working at a high level government job could easily be earning a paycheck that is many times higher if they were employed elsewhere. In fact, this is often true. When he left his job as Treasury Secretary, Geithner took a position with a private equity company where his salary is likely several million dollars a year. ..."
"... The CEOs who are paid tens of millions a year would like the public to think that the market is simply compensating them for their extraordinary skills. A more realistic story is that a broken corporate governance process gives corporate boards of directors - the people who largely determine CEO pay -little incentive to hold down pay. Directors are more closely tied to top management than to the shareholders they are supposed to represent, and their positions are lucrative, usually paying six figures for very part-time work. Directors are almost never voted out by shareholders for their lack of attention to the job or for incompetence. ..."
"... We also have done little to foster medical travel. This could lead to enormous benefits to patients and the economy, since many high cost medical procedures can be performed at a fifth or even one-tenth the U.S. price in top quality medical facilities elsewhere in the world. In this context, it is not surprising that the median pay of physicians is over $250,000 a year and some areas of specialization earn close to twice this amount. In the case of physicians alone, if pay were reduced to West European-levels the savings would be close to $100 billion a year (@ 0.6 percent of GDP). ..."
"... As a technical matter, the Federal Reserve Bank of New York is a private bank. It is owned by the banks that are members of the Federal Reserve System in the New York District. ..."
Yves here. We are delighted to feature an excerpt from Dean Baker's new book
Rigged , which you can find at
http://deanbaker.net/books/rigged.htm via either a free download
or in hard copy for the cost of printing and shipping. The book argues that policy in five areas, macroeconomics, the financial sector,
intellectual property, corporate governance, and protection for highly paid professionals, have all led to the upward distribution
of income. The implication is that the yawning gap between the 0.1% and the 1% versus everyone else is not the result of virtue ("meritocracy")
but preferential treatment, and inequality would be substantially reduced if these policies were reversed.
I urge you to read his book in full and encourage your friends, colleagues, and family to do so as well.
By Dean Baker, Co-Director, Center for Economic and Policy Research
Chapter 1: Introduction: Trading in myths
In winter 2016, near the peak of Bernie Sanders' bid for the Democratic presidential nomination, a new line became popular among
the nation's policy elite: Bernie Sanders is the enemy of the world's poor. Their argument was that Sanders, by pushing trade policies
to help U.S. workers, specifically manufacturing workers, risked undermining the well-being of the world's poor because exporting
manufactured goods to the United States and other wealthy countries is their path out of poverty. The role model was China, which
by exporting has largely eliminated extreme poverty and drastically reduced poverty among its population. Sanders and his supporters
would block the rest of the developing world from following the same course.
This line, in its Sanders-bashing permutation, appeared early on in Vox, the millennial-oriented media upstart, and was quickly
picked up elsewhere (Beauchamp 2016).
[1] After all, it was pretty irresistible. The ally of the downtrodden and enemy of the rich was pushing policies that would
condemn much of the world to poverty.
The story made a nice contribution to preserving the status quo, but it was less valuable if you respect honesty in public debate.
The problem in the logic of this argument should be apparent to anyone who has taken an introductory economics course. It assumes
that the basic problem of manufacturing workers in the developing world is the need for someone who will buy their stuff. If people
in the United States don't buy it, then the workers will be out on the street and growth in the developing world will grind to a
halt.
In this story, the problem is that we don't have enough people in the world to buy stuff. In other words, there is a shortage
of demand. But is it really true that no one else in the world would buy the stuff produced by manufacturing workers in the developing
world if they couldn't sell it to consumers in the United States? Suppose people in the developing world bought the stuff they produced
raising their living standards by raising their own consumption.
That is how the economics is supposed to work. In the standard theory, general shortages of demand are not a problem.
[2] Economists have traditionally assumed that economies tended toward full employment. The basic economic constraint was a lack
of supply. The problem was that we couldn't produce enough goods and services, not that we were producing too much and couldn't find
anyone to buy them. In fact, this is why all the standard models used to analyze trade agreements like the Trans-Pacific Partnership
assume trade doesn't affect total employment.
[3] Economies adjust so that shortages of demand are not a problem.
In this standard story (and the Sanders critics are people who care about textbook economics), capital flows from slow-growing
rich countries, where it is relatively plentiful and so gets a low rate of return, to fast-growing poor countries, where it is scarce
and gets a high rate of return (Figure 1-1).
So the United States, Japan, and the European Union should be running large trade surpluses, which is what an outflow of capital
means. Rich countries like ours should be lending money to developing countries, providing them with the means to build up their
capital stock and infrastructure while they use their own resources to meet their people's basic needs.
This wasn't just theory. That story accurately described much of the developing world, especially Asia, through the 1990s. Countries
like Indonesia and Malaysia were experiencing rapid annual growth of 7.8 percent and 9.6 percent, respectively, even as they ran
large trade deficits, just over 2 percent of GDP each year in Indonesia and almost 5 percent in Malaysia.
These trade deficits probably were excessive, and a crisis of confidence hit East Asia and much of the developing world in the
summer of 1997. The inflow of capital from rich countries slowed or reversed, making it impossible for the developing countries to
sustain the fixed exchange rates most had at the time. One after another, they were forced to abandon their fixed exchange rates
and turn to the International Monetary Fund (IMF) for help.
Rather than promulgating policies that would allow developing countries to continue the textbook development path of growth driven
by importing capital and running trade deficits, the IMF made debt repayment a top priority. The bailout, under the direction of
the Clinton administration Treasury Department, required developing countries to switch to large trade surpluses (Radelet and Sachs
2000, O'Neil 1999).
The countries of East Asia would be far richer today had they been allowed to continue on the growth path of the early and mid-1990s,
when they had large trade deficits (Figure 1-2). Four of the five would be more than twice as rich, and the fifth, Vietnam, would
be almost 50 percent richer. South Korea and Malaysia would have higher per capita incomes today than the United States.
In the wake of the East Asia bailout, countries throughout the developing world decided they had to build up reserves of foreign
exchange, primarily dollars, in order to avoid ever facing the same harsh bailout terms as the countries of East Asia. Building up
reserves meant running large trade surpluses, and it is no coincidence that the U.S. trade deficit has exploded, rising from just
over 1 percent of GDP in 1996 to almost 6 percent in 2005. The rise has coincided with the loss of more than 3 million manufacturing
jobs, roughly 20 percent of employment in the sector.
There was no reason the textbook growth pattern of the 1990s could not have continued. It wasn't the laws of economics that forced
developing countries to take a different path, it was the failed bailout and the international financial system. It would seem that
the enemy of the world's poor is not Bernie Sanders but rather the engineers of our current globalization policies.
There is a further point in this story that is generally missed: it is not only the volume of trade flows that is determined by
policy, but also the content. A major push in recent trade deals has been to require stronger and longer patent and copyright protection.
Paying the fees imposed by these terms, especially for prescription drugs, is a huge burden on the developing world. Bill Clinton
would have much less need to fly around the world for the Clinton Foundation had he not inserted the TRIPS (Trade Related Aspects
of Intellectual Property Rights ) provisions in the World Trade Organization (WTO) that require developing countries to adopt U.S.-style
patent protections. Generic drugs are almost always cheap -patent protection makes drugs expensive. The cancer and hepatitis drugs
that sell for tens or hundreds of thousands of dollars a year would sell for a few hundred dollars in a free market. Cheap drugs
would be more widely available had the developed world not forced TRIPS on the developing world.
Of course, we have to pay for the research to develop new drugs or any innovation. We also have to compensate creative workers
who produce music, movies, and books. But there are efficient alternatives to patents and copyrights, and the efforts by the elites
in the United States and other wealthy countries to impose these relics on the developing world is just a mechanism for redistributing
income from the world's poor to Pfizer, Microsoft, and Disney. Stronger and longer patent and copyright protection is not a necessary
feature of a 21 st century economy.
In textbook trade theory, if a country has a larger trade surplus on payments for royalties and patent licensing fees, it will
have a larger trade deficit in manufactured goods and other areas. The reason is that, in theory, the trade balance is fixed by national
savings and investment, not by the ability of a country to export in a particular area. If the trade deficit is effectively fixed
by these macroeconomic factors, then more exports in one area mean fewer exports in other areas. Put another way, income gains for
Pfizer and Disney translate into lost jobs for workers in the steel and auto industries.
The conventional story is that we lose manufacturing jobs to developing countries because they have hundreds of millions of people
willing to do factory work at a fraction of the pay of manufacturing workers in the United States. This is true, but developing countries
also have tens of millions of smart and ambitious people willing to work as doctors and lawyers in the United States at a fraction
of the pay of the ones we have now.
Gains from trade work the same with doctors and lawyers as they do with textiles and steel. Our consumers would save hundreds
of billions a year if we could hire professionals from developing countries and pay them salaries that are substantially less than
what we pay our professionals now. The reason we import manufactured goods and not doctors is that we have designed the rules of
trade that way. We deliberately write trade pacts to make it as easy as possible for U.S. companies to set up manufacturing operations
abroad and ship the products back to the United States, but we have done little or nothing to remove the obstacles that professionals
from other countries face in trying to work in the United States. The reason is simple: doctors and lawyers have more political power
than autoworkers.
[4]
In short, there is no truth to the story that the job loss and wage stagnation faced by manufacturing workers in the United States
and other wealthy countries was a necessary price for reducing poverty in the developing world.
[5] This is a fiction that is used to justify the upward redistribution of income in rich countries. After all, it is pretty
selfish for rich country autoworkers and textile workers to begrudge hungry people in Africa and Asia and the means to secure food,
clothing, and shelter.
The other aspect of this story that deserves mention is the nature of the jobs to which our supposedly selfish workers feel entitled.
The manufacturing jobs that are being lost to the developing world pay in the range of $15 to $30 an hour, with the vast majority
closer to the bottom figure than the top. The average hourly wage for production and nonsupervisory workers in manufacturing in 2015
was just under $20 an hour, or about $40,000 a year. While a person earning $40,000 is doing much better than a subsistence farmer
in Sub-Saharan Africa, it is difficult to see this worker as especially privileged.
By contrast, many of the people remarking on the narrow-mindedness and sense of entitlement of manufacturing workers earn comfortable
six-figure salaries. Senior writers and editors at network news shows or at the New York Times and Washington Post
feel entitled to their pay because they feel they have the education and skills to be successful in a rapidly changing global economy.
These are the sort of people who consider it a sacrifice to work at a high-level government job for $150,000 to $200,000 a year.
For example, Timothy Geithner, President Obama's first treasury secretary, often boasts about his choice to work for various government
agencies rather than earn big bucks in the private sector. His sacrifice included a stint as president of the Federal Reserve Bank
of New York that paid $415,000 a year.
[6] This level of pay put Geithner well into the top 1 percent of wage earners.
Geithner's comments about his sacrifices in public service did not elicit any outcry from the media at the time because his perspective
was widely shared. The implicit assumption is that the sort of person who is working at a high level government job could easily
be earning a paycheck that is many times higher if they were employed elsewhere. In fact, this is often true. When he left his job
as Treasury Secretary, Geithner took a position with a private equity company where his salary is likely several million dollars
a year.
Not everyone who was complaining about entitled manufacturing workers was earning as much as Timothy Geithner, but it is a safe
bet that the average critic was earning far more than the average manufacturing worker - and certainly far more than the average
displaced manufacturing worker.
Turning the Debate Right-Side Up: Markets Are Structured
The perverse nature of the debate over a trade policy that would have the audacity to benefit workers in rich countries is a great
example of how we accept as givens not just markets themselves but also the policies that structure markets. If we accept it as a
fact of nature that poor countries cannot borrow from rich countries to finance their development, and that they can only export
manufactured goods, then their growth will depend on displacing manufacturing workers in the United States and other rich countries.
It is absurd to narrow the policy choices in this way, yet the centrists and conservatives who support the upward redistribution
of the last four decades have been extremely successful in doing just that, and progressives have largely let them set the terms
of the debate.
Markets are never just given. Neither God nor nature hands us a worked-out set of rules determining the way property relations
are defined, contracts are enforced, or macroeconomic policy is implemented. These matters are determined by policy choices. The
elites have written these rules to redistribute income upward. Needless to say, they are not eager to have the rules rewritten which
means they have no interest in even having them discussed.
But for progressive change to succeed, these rules must be addressed. While modest tweaks to tax and transfer policies can ameliorate
the harm done by a regressive market structure, their effect will be limited. The complaint of conservatives - that tampering with
market outcomes leads to inefficiencies and unintended outcomes - is largely correct, even if they may exaggerate the size of the
distortions from policy interventions. Rather than tinker with badly designed rules, it is far more important to rewrite the rules
so that markets lead to progressive and productive outcomes in which the benefits of economic growth and improving technology are
broadly shared
This book examines five broad areas where the rules now in place tend to redistribute income upward and where alternative rules
can lead to more equitable outcomes and a more efficient market:
Macroeconomic policies determining levels of employment and output. Financial regulation and the structure of financial markets.
Patent and copyright monopolies and alternative mechanisms for financing innovation and creative work. Pay of chief executive
officers (CEOs) and corporate governance structures. Protections for highly paid professionals, such as doctors and lawyers.
In each of these areas, it is possible to identify policy choices that have engineered the upward redistribution of the last four
decades.
In the case of macroeconomic policy, the United States and other wealthy countries have explicitly adopted policies that focus
on maintaining low rates of inflation. Central banks are quick to raise interest rates at the first sign of rising inflation and
sometimes even before. Higher interest rates slow inflation by reducing demand, thereby reducing job growth, and reduced job growth
weakens workers' bargaining power and puts downward pressure on wages. In other words, the commitment to an anti-inflation policy
is a commitment by the government, acting through central banks, to keep wages down. It should not be surprising that this policy
has the effect of redistributing income upward.
The changing structure of financial regulation and financial markets has also been an important factor in redistributing income
upward. This is a case where an industry has undergone very rapid change as a result of technological innovation. Information technology
has hugely reduced the cost of financial transactions and allowed for the development of an array of derivative instruments that
would have been unimaginable four decades ago. Rather than modernizing regulation to ensure that these technologies allow the financial
sector to better serve the productive economy, the United States and other countries have largely structured regulations to allow
a tiny group of bankers and hedge fund and private equity fund managers to become incredibly rich.
This changed structure of regulation over the last four decades was not "deregulation," as is often claimed. Almost no proponent
of deregulation argued against the bailouts that saved Wall Street in the financial crisis or against the elimination of government
deposit insurance that is an essential part of a stable banking system. Rather, they advocated a system in which the rules restricting
their ability to profit were eliminated, while the insurance provided by the Federal Reserve Board, the Federal Deposit Insurance
Corporation, and other arms of the government were left in place. The position of "deregulators" effectively amounted to arguing
that they should not have to pay for the insurance they were receiving.
The third area in which the rules have been written to ensure an upward redistribution is patent and copyright protection. Over
the last four decades these protections have been made stronger and longer. In the case of both patent and copyright, the duration
of the monopoly period has been extended. In addition, these monopolies have been applied to new areas. Patents can now be applied
to life forms, business methods, and software. Copyrights have been extended to cover digitally produced material as well as the
internet. Penalties for infringement have been increased and the United States has vigorously pursued their application in other
countries through trade agreements and diplomatic pressure.
Government-granted monopolies are not facts of nature, and there are alternative mechanisms for financing innovation and creative
work. Direct government funding, as opposed to government granted monopolies, is one obvious alternative. For example, the government
spends more than $30 billion a year on biomedical research through the National Institutes of Health - money that all parties agree
is very well spent. There are also other possible mechanisms. It is likely that these alternatives are more efficient than the current
patent and copyright system, in large part because they would be more market-oriented. And, they would likely lead to less upward
redistribution than the current system.
The CEOs who are paid tens of millions a year would like the public to think that the market is simply compensating them for their
extraordinary skills. A more realistic story is that a broken corporate governance process gives corporate boards of directors -
the people who largely determine CEO pay -little incentive to hold down pay. Directors are more closely tied to top management than
to the shareholders they are supposed to represent, and their positions are lucrative, usually paying six figures for very part-time
work. Directors are almost never voted out by shareholders for their lack of attention to the job or for incompetence.
The market discipline that holds down the pay of ordinary workers does not apply to CEOs, since their friends determine their
pay. And a director has little incentive to pick a fight with fellow directors or top management by asking a simple question like,
"Can we get a CEO just as good for half the pay?" This privilege matters not just for CEOs; it has the spillover effect of raising
the pay of other top managers in the corporate sector and putting upward pressure on the salaries of top management in universities,
hospitals, private charities, and other nonprofits.
Reformed corporate governance structures could empower shareholders to contain the pay of their top-level employees. Suppose directors
could count on boosts in their own pay if they cut the pay of top management without hurting profitability, With this sort of policy
change, CEOs and top management might start to experience some of the downward wage pressure that existing policies have made routine
for typical workers.
This is very much not a story of the natural workings of the market. Corporations are a legal entity created by the government,
which also sets the rules of corporate governance. Current law includes a lengthy set of restrictions on corporate governance practices.
It is easy to envision rules which would make it less likely that CEOs earn such outlandish paychecks by making it easier for shareholders
to curb excessive pay.
Finally, government policies strongly promote the upward redistribution of income for highly paid professionals by protecting
them from competition. To protect physicians and specialists, we restrict the ability of nurse practitioners or physician assistants
to perform tasks for which they are entirely competent. We require lawyers for work that paralegals are capable of completing. While
trade agreements go far to remove any obstacle that might protect an autoworker in the United States from competition with a low-paid
factory worker in Mexico or China, they do little or nothing to reduce the barriers that protect doctors, dentists, and lawyers from
the same sort of competition. To practice medicine in the United States, it is still necessary to complete a residency program here,
as though there were no other way for a person to become a competent doctor.
We also have done little to foster medical travel. This could lead to enormous benefits to patients and the economy, since many
high cost medical procedures can be performed at a fifth or even one-tenth the U.S. price in top quality medical facilities elsewhere
in the world. In this context, it is not surprising that the median pay of physicians is over $250,000 a year and some areas of specialization
earn close to twice this amount. In the case of physicians alone, if pay were reduced to West European-levels the savings would be
close to $100 billion a year (@ 0.6 percent of GDP).
Changing the rules in these five areas could reduce much and possibly all of the upward redistribution of the last four decades.
But changing the rules does not mean using government intervention to curb the market. It means restructuring the market to produce
different outcomes. The purpose of this book is to show how.
[1] See also Weissman (2016), Iacono (2016), Worstall (2016), Lane (2016), and Zakaria (2016).
[2] As explained in the next chapter, this view is not exactly correct, but it's what you're supposed to believe if you adhere
to the mainstream economic view.
[3] There can be modest changes in employment through a supply-side effect. If the trade deal increases the efficiency of the
economy, then the marginal product of labor should rise, leading to a higher real wage, which in turn should induce some people to
choose work over leisure. So the trade deal results in more people choosing to work, not an increased demand for labor.
[4] For those worried about brain drain from developing countries, there is an easy fix. Economists like to talk about taxing
the winners, in this case developing country professionals and rich country consumers, to compensate the losers, which would be the
home countries of the migrating professionals. We could tax a portion of the professionals' pay to allow their home countries to
train two or three professionals for every one that came to the United States. This is a classic win-win from trade.
[5] The loss of manufacturing jobs also reduced the wages of less-educated workers (those without college degrees) more generally.
The displaced manufacturing workers crowded into retail and other service sectors, putting downward pressure on wages there.
[6] As a technical matter, the Federal Reserve Bank of New York is a private bank. It is owned by the banks that are members
of the Federal Reserve System in the New York District.
"Markets are never just given. Neither God nor nature hands us a worked-out set of rules determining the way property relations
are defined, contracts are enforced, or macroeconomic policy is implemented. These matters are determined by policy choices. The
elites have written these rules to redistribute income upward. Needless to say, they are not eager to have the rules rewritten
which means they have no interest in even having them discussed."
======================================================
It is one of those remarkable hypocrisies that free "unregulated" trade requires deals of thousands of pages .
but if these deals weren't so carefully structured to help the 1%, support would melt like snowmen in Fresno on a July day
Or check your local indy, or one of those that take orders (I refrain from naming my favorite co-op in Chicago, and anyway
I admit there are others). Nice to support those when you can.
Almost no proponent of deregulation argued against the bailouts that saved Wall Street in the financial crisis or against
the elimination of government deposit insurance that is an essential part of a stable banking system.
Actually I believe there were some Republicans who denounced the Wall Street bailout as a violation of capitalist principles.
My state's Mark Sanford comes to mind. It was the Dems at the urging of Pelosi who saved the bailout. On the other hand many of
my local politicians are big on "public/private" partnerships which would be a violation of laissez-faire that they approve. Perhaps
it was simply that there are no giant banks headquartered in SC.
The truth is there is no coherent intellectual basis to how the US economy is currently run. It's all about power and what
you can do with it. Which is to say it is our politics, above all, that is broken.
"That is how the economics is supposed to work. In the standard theory, general shortages of demand are not a problem.[2]
Economists have traditionally assumed that economies tended toward full employment. The basic economic constraint was a lack of
supply. The problem was that we couldn't produce enough goods and services, not that we were producing too much and couldn't find
anyone to buy them. In fact, this is why all the standard models used to analyze trade agreements like the Trans-Pacific Partnership
assume trade doesn't affect total employment.[3] Economies adjust so that shortages of demand are not a problem."
Unbelievable.
By the 1920s they realised the system produced so much stuff that extensive advertising was needed to shift it all.
One hundred year's later, we might take this on board.
What is the global advertising budget?
The amount necessary to shift all the crap the system produces today.
We need to move on from Milton Freidman's ideas and discover what trade in a globalized world is really about.
We are still under the influence of Milton Freidman's ideas of a globalised free trade world.
These ideas came from Milton Freidman's imagination where he saw the ideal as small state, raw capitalism and thought the public
sector should be sold off and entitlement programs whittled down until everything must be purchased through the private sector.
"You are free to spend your money as you choose"
Not mentioning its other meaning:
"No money, no freedom"
After Milton Freedman's "shock therapy" in Russia, people were left with so little money they couldn't afford to eat and starved
to death. In Greece people cannot afford even bread today.
But this is economic liberalism, the economy comes first.
Milton Freidman used his imagination to work out what small state, raw capitalism looked like whereas he could have looked
at it in reality through history books of the 18th and 19th centuries where it had already existed.
The Classical Economists studied it and were able to see its problems first hand and noted the detrimental effects of the rentier
class on the economy. They were constantly looking to get "unearned" income from doing nothing; sucking purchasing power out of
the economy and bleeding it dry.
Adam Smith observed:
"The Labour and time of the poor is in civilised countries sacrificed to the maintaining of the rich in ease and luxury.
The Landlord is maintained in idleness and luxury by the labour of his tenants. The moneyed man is supported by his extractions
from the industrious merchant and the needy who are obliged to support him in ease by a return for the use of his money. But every
savage has the full fruits of his own labours; there are no landlords, no usurers and no tax gatherers."
Adam Smith saw landlords, usurers (bankers) and Government taxes as equally parasitic, all raising the cost of doing business.
He sees the lazy people at the top living off "unearned" income from their land and capital.
He sees the trickle up of Capitalism:
1) Those with excess capital collect rent and interest.
2) Those with insufficient capital pay rent and interest.
He differentiates between "earned" and "unearned" income.
Today we encourage a new rentier class of BTL landlords who look to extract the "earned" income of generation rent for "unearned"
income. If you have a large BTL portfolio you can become a true rentier, do nothing productive at all and live off "unearned"
income extracted from generation rent, the true capitalist parasite. (UK)
The Classical Economists realised capitalism has two sides, the productive side where "earned" income is generated and the
unproductive, parasitic, rentier side where "unearned" income is generated.
You should tax "unearned" income to discourage the parasitic side of capitalism.
You shouldn't tax "earned" income to encourage the productive side of capitalism.
You should provide low cost housing, education and services to create a low cost of living, giving a low minimum wage making
you globally competitive. This is to be funded by taxes on "unearned" income.
The US has probably been the most successful in making its labour force internationally uncompetitive with soaring costs of
housing, healthcare and student loan repayments.
These all have to be covered by wages and US businesses are now squealing about the high minimum wage.
That's Milton Freidman's imagined small state, raw capitalism.
What he imagined bears little resemblance to the reality the Classical Economists saw firsthand.
We need to move on from Milton Freidman fantasy land.
Small state, raw capitalism as observed by Adam Smith:
"But the rate of profit does not, like rent and wages, rise with the prosperity and fall with the declension of the society.
On the contrary, it is naturally low in rich and high in poor countries, and it is always highest in the countries which are going
fastest to ruin."
When rates of profit are high, capitalism is cannibalising itself by:
1) Not engaging in long term investment for the future
2) Paying insufficient wages to maintain demand for its products and services
In the 18th Century they would have understood today's problems with growth and demand.
Luckily Jeff Bezos didn't inhabit Milton Freidman fantasy land.
He re-invested almost everything to turn Amazon onto the global behemoth it is today.
' The commitment to an anti-inflation policy is a commitment by the government, acting through central banks, to keep wages
down. '
This is strikingly silly. Insert the word 'nominal' before wages, and it's not a howler anymore.
Anti-inflation policy in fact has little influence on real wages (the variable of concern, not nominal wages). But it has a
lot to do with preventing the social chaos of constantly rising prices, strikes for higher wages, inability of first-time home
buyers to borrow at affordable rates, and so on.
Inflationism is greasy kid stuff not to mention a brazen fraud on the public.
As one who walked the corridors of power in a very modest capacity in my country in the early to mid 1990s, can I just say
that people with power or influence then were aware that globalisation would create winners and losers. I recall the consensus
of those I knew then was that steps would need to be taken to compensate the losers. The tragedy is that these steps were never
taken, or, if they were, only to a wholly inadequate degree.
The always elusive referents for cost, price and value the flip-side of social chaos would seem the entropic degradation of
wasted lives, excluded from participating {either-OR} abandoned as irredeemable
Higher interest rates slow inflation by reducing demand, thereby reducing job growth, and reduced job growth weakens workers'
bargaining power and puts downward pressure on wages.
Your assertion that anti-inflation policy has little influence on real wages does not address Baker's statement about the mechanism
by which he says it does. Given an argument between two people, one of whom cites a mechanism he is probably prepared to document
with numbers and one of whom merely declares his belief, which are people more likely to trust? Granted always, they should go
look for the numbers before they fully accept the statement, his credibility is currently higher than yours on this subject.
By contrast, since the 1970s real wages stalled, while interest rates round-tripped back to 2 percent.
Over nearly seven decades, the correlation is quite the opposite from that made up claimed by Dean Bonkers.
Namely, real wages soared under a regime of steadily rising nominal interest rates.
Since my original reply has disappeared in limbo, I will merely note that numbers are probably even crunchier when you don't
generalize across a span of decades: first there was A, then there was B, nothing else happened. It's a sure way to obscure patterns.
And Jim, please quit the ad hominem stuff! It's ugly and needless. If you really have an argument you don't need it, and if
you don't you don't gain by it. You know perfectly well he's not making things up and he's not bonkers. When you say stuff like
that, the obvious presumption is that you just don't want to consider his arguments because they lead somewhere you don't want
to go.
Perhaps I am missing the point being made, but if you are suggesting that increases in real wages in the 1945-1975 period caused
inflation, why not provide the data on inflation which would in fact show that inflation was essentially tame for 20 years in
this period (1952-1972, with a slight hiccup in 1969-1971), thereby contradicting your point? And if you are suggesting that Fed
increases in interest rate have not resulted in suppression of wages you will have to demonstrate that using analysis that takes
into account the lag in time between increase in rate and transmission to wages, and in that case would you not also use the Fed
Funds Rate itself as a variable?
Bulltwacky, they have been globalizing wages downwards while globalizing housing prices upwards!
Every time some stupid and moronic newsy floozy on one of the CorporateNonMedia outlets claims housing purchases may be going
down because consumer confidence is plummeting, they CHOOSE to ignore the foreign buyers of said houses!
Did I get this right? Full employment is an assumed boundary condition and so is fixed balance of trade? If the model is to
work as advertised then the boundary conditions must be hard wired to be true, right?
If the top 25 hedge fund managers saved around $5 billion per year in being taxed on their income at capital gains rate (carried
interest ruling in tax code - utterly corrupt), then think of the amount that is being robbed from the tax base when one considers
ALL the hedge fund people, and ALL the private equity types (who also do this), a conservative amount of tax revenues remitted
should be around $100 billion per year!
"... My impression is that Trump_vs_deep_state is more about dissatisfaction of the Republican base with the Republican brass (which fully endorsed neoliberal globalization), the phenomenon somewhat similar to Sanders. ..."
"... Working class and lower middle class essentially abandoned DemoRats (Clinton democrats) after so many years of betrayal and "they have nowhere to go" attitude. ..."
"... Now they try to forge the alliance of highly paid professionals who benefitted from globalization("creative class"), financial speculators and minorities. Which does not look like a stable coalition to me. ..."
"... In other words both Parties are now split and have two mini-parties inside. I am not sure that Sanders part of Democratic party would support Hillary. The wounds caused by DNC betrayal and double dealing are still too fresh. ..."
"... We have something like what Marxists call "revolutionary situation" when the elite loses control of "peons". And existence of Internet made MSM propaganda far less effective that it would be otherwise. That's why they resort to war propaganda tricks. ..."
"That's not untrue, but it seems to me to be getting worse."
Because of economic stagnation and anxiety among lower class Republicans. Trump blames immigration
and trade unlike traditional elite Republicans. These are economic issues.
Trump supporters no longer believe or trust the Republican elite who they see as corrupt
which is partly true. They've been backing Nixon, Reagan, Bush etc and things are just getting
worse. They've been played.
Granted it's complicated and partly they see their side as losing and so are doubling down
on the conservatism, racism, sexism etc. But Trump *brags* that he was against the Iraq war.
That's not an elite Republican opinion.
likbez -> DrDick... , -1
My impression is that Trump_vs_deep_state is more about dissatisfaction of the Republican base with the Republican
brass (which fully endorsed neoliberal globalization), the phenomenon somewhat similar to Sanders.
Working class and lower middle class essentially abandoned DemoRats (Clinton democrats) after
so many years of betrayal and "they have nowhere to go" attitude.
Looks like they have found were to go this election cycle and this loss of the base is probably
was the biggest surprise for neoliberal Democrats.
Now they try to forge the alliance of highly paid professionals who benefitted from globalization("creative
class"), financial speculators and minorities. Which does not look like a stable coalition to
me.
Some data suggest that among unions which endorsed Hillary 3 out of 4 members will vote against
her. And that are data from union brass. Lower middle class might also demonstrate the same pattern
this election cycle.
In other words both Parties are now split and have two mini-parties inside. I am not sure that
Sanders part of Democratic party would support Hillary. The wounds caused by DNC betrayal and
double dealing are still too fresh.
We have something like what Marxists call "revolutionary situation" when the elite loses control
of "peons". And existence of Internet made MSM propaganda far less effective that it would be
otherwise. That's why they resort to war propaganda tricks.
In a lengthy speech on Saturday night in Manheim, Pennsylvania, Republican nominee for president
Donald J. Trump lambasted his opponent Democratic nominee Hillary Rodham Clinton for a secret tape
recording of her bashing supporters of Sen. Bernie Sanders of Vermont-and even called for Clinton
to be placed in prison and questioned as to whether she has been loyal to her husband former President
Bill Clinton.
Trump said in the speech on Saturday night:
A new audio tape that has surfaced just yesterday from another one of Hillary's high roller
fundraisers shows her demeaning and mocking Bernie Sanders and all of his supporters. You know,
and I'll tell you something we have a much bigger movement that Bernie Sanders ever had. We have
much bigger crowds than Sanders ever had. And we have a more important movement than Bernie Sanders
ever had because we're going to save our country, okay? We're going to save our country. But I
can tell you Bernie Sanders would have left a great, great legacy had he not made the deal with
the devil. He would have really left a great legacy. Now he shows up and 120 people come in to
hear him talk. Bernie Sanders would have left a great legacy had he not made the deal, had he
held his head high and walked away. Now he's on the other side perhaps from us and we want to
get along with everybody and we will-we're going to unite the country-but what Bernie Sanders
did to his supporters was very, very unfair. And they're really not his supporters any longer
and they're not going to support Hillary Clinton. I really believe a lot of those people are coming
over and largely because of trade, college education, lots of other things-but largely because
of trade, they're coming over to our side-you watch, you watch. Especially after Hillary mocks
him and mocks all of those people by attacking him and his supporters as 'living in their parents'
basements,' and trapped in dead-end careers. That's not what they are.
Also in his speech on Saturday night, Trump summed up exactly what came out in the latest Hillary
Clinton tapes in which she mocks Sanders supporters:
She describes many of them as ignorant, and [that] they want the United States to be more like
Scandinavia but that 'half the people don't know what that means' in a really sarcastic tone because
she's a sarcastic woman. To sum up, and I'll tell you the other thing-she's an incompetent woman.
She's an incompetent woman. I've seen it. Just take a look at what she touches. It never works
out, and you watch: her run for the presidency will never ever work out because we can't let it
work out. To sum up, Hillary Clinton thinks Bernie supporters are hopeless and ignorant basement
dwellers. Then, of course, she thinks people who vote for and follow us are deplorable and irredeemable.
I don't think so. I don't think so. We have the smartest people, we have the sharpest people,
we have the most amazing people, and you know in all of the years of this country they say, even
the pundits-most of them aren't worth the ground they're standing on, some of that ground could
be fairly wealthy but ground, but most of these people say they have never seen a phenomenon like
is going on. We have crowds like this wherever we go.
WATCH THE FULL SPEECH:
Later in the speech, Trump came back to the tape again and hammered her once more for it.
"Hillary Clinton all but said that most of the country is racist, including the men and women
of law enforcement," Trump said. "She said that the other night. Did anybody like Lester Holt? Did
anybody question her when she said that? No, she said it the other night. [If] you're not a die hard
Clinton fan-you're not a supporter-from Day One, Hillary Clinton thinks you are a defective person.
That's what she's going around saying."
In the speech, Trump questioned whether Clinton has the moral authority to lead when she considers
the majority of Americans-Trump supporters and Sanders supporters-to be "defective" people. And he
went so far as saying that Clinton "should be in prison." He went on:
How on earth can Hillary Clinton try to lead this country when she has nothing but contempt
for the people who live in this country? She's got contempt. First of all, she's got so many scandals
and she's been caught cheating so much. One of the worst things I've ever witnessed as a citizen
of the United States was last week when the FBI director was trying so hard to explain how she
away with what she got away with, because she should be in prison. Let me tell you. She should
be in prison. She's being totally protected by the New York Times and the Washington Post and
all of the media and CNN-Clinton News Network-which nobody is watching anyway so what difference
does it make? Don't even watch it. But she's being protected by many of these groups. It's not
like do you think she's guilty? They've actually admitted she's guilty. And then she lies and
lies, 33,000 emails deleted, bleached, acid-washed! And then they take their phones and they hammer
the hell out of them. How many people have acid washed or bleached a Tweet? How many?
He returned to the secret Clinton tape a little while later:
Hillary Clinton slanders and attacks anyone who wants to put America First, whether they
are Trump Voters or Bernie Voters. What she said about Bernie voters amazing. Like the European
Union, she wants to erase our borders and she wants to do it for her donors and she wants people
to pour into country without knowing who they are.
Trump later bashed the media as "dishonest as hell" when calling on the reporters at his event
to "turn your cameras" to show the crowd that came to see him.
"If they showed the kind of crowds we have-which people can hear, you know it's interesting: you
can hear the crowd when you hear the television but if they showed the crowd it would be better television,
but they don't know much about that. But it would actually be better television," Trump said.
Trump also questioned whether Hillary Clinton has been loyal to her husband, former President
Bill Clinton. Bill Clinton has been known to cheat on Hillary Clinton with a variety of mistresses
and has been accused of rape and sexual assault by some women.
"Hillary Clinton's only loyalty is to her financial contributors and to herself," Trump
said. "I don't even think she's loyal to Bill, if you want to know the truth. And really, folks,
really: Why should she be, right? Why should she be?"
Throughout the speech, Trump weaved together references to his new campaign theme about Clinton-"Follow
The Money"-with details about the Trans Pacific Partnership (TPP) trade deal. He said:
We're going to take on the corrupt media, the powerful lobbyists and the special interests
that have stolen your jobs, your factories, and your future-that's exactly what's happened. We're
going to stop Hillary Clinton from continuing to raid the industry from your state for her profit.
Hillary Clinton has collected millions of dollars from the same global corporations shipping
your jobs and your dreams to other countries. You know it and everybody else knows it. That's
why Clinton, if she ever got the chance, would 100 percent approve Trans Pacific Partnership-a
total disastrous trade deal. She called the deal the 'gold standard.' The TPP will bring economic
devastation to Pennsylvania and our campaign is the only chance to stop that and other bad things
that are happening to our country. She lied about the Gold Standard the other night at the debate.
She said she didn't say it-she said it. We want to stop the Trans Pacific Partnership and if we
don't-remember this, if we don't stop it, billions and billions [of dollars] in jobs and wealth
will be vacuumed right out of Pennsylvania and sent to these other countries. Just like NAFTA
was a disaster, this will be a disaster. Frankly I don't think it'll be as bad as NAFTA. It can't
get any worse than that-signed by Bill Clinton. All of us here in this massive room here tonight
can prevent this from happening. Together we can stop TPP and we can end the theft of American
jobs and prosperity.
Trump praised Sanders for being strongly opposed to the TPP:
I knew one man-I'm not a big fan-but one man who knew the dangers of the TPP was Bernie
Sanders. Crazy Bernie. He was right about one thing, only one thing, and that was trade. He was
right about it because he knew we were getting ripped off, but he wouldn't be able to do anything
about it . We're going to do a lot about it. We're going to have those highways running the
opposite direction. We're going to have a lot of trade, but it's going to come into our country.
We are going to start benefitting our country because right now it's one way road to trouble.
Our jobs leave us, our money leaves us. With Mexico, we get the drugs-they get the cash-it's that
simple.
Hillary Clinton, Trump noted, is "controlled by global special interests."
"She's on the opposite side of Bernie on the trade issue," Trump said. "She's totally on the opposite
side of Bernie."
He circled back to trade a bit later in the more-than-hour-long speech, hammering TPP and Clinton
cash connections. Trump continued:
Three TPP member countries gave between $6 and $15 million to Clinton. At least four lobbyists
who are actively lobbying for TPP passage have raised more than $800,000 for her campaign. I'm
just telling you Pennsylvania, we're going to make it. We're going to make it. We're going to
make it if we have Pennsylvania for sure. It'll be easy. But you cannot let this pass. NAFTA passed.
It's been the worst trade deal probably ever passed, not in this country but anywhere in the world.
It cleaned out New England. It cleaned out big portions of Pennsylvania. It cleaned out big portions
of Ohio and North Carolina and South Carolina-you can't let it happen.
Trump even called the politicians like Clinton "bloodsuckers" who have let America be drained
out of millions upon millions of jobs.
"These bloodsuckers want it to happen," Trump said. "They're politicians that are getting taken
care of by people that want it to happen. Other countries want it to happen because it's good for
them, but it's not good for us. So hopefully you're not going to let it happen. Whatever Hillary's
donors want, they get. They own her. On Nov. 8, we're going to end Clinton corruption. Hillary Clinton,
dishonest person, is an insider fighting for herself and for her friends. I'm an outsider fighting
for you. And by the way, just in case you're not aware, I used to be an insider but I thought this
was the right thing to do. This is the right thing to do, believe me."
The Walloon mouse : ...Instead of decrying people's stupidity and ignorance in rejecting trade
deals, we should try to understand why such deals lost legitimacy in the first place. I'd put
a large part of the blame on mainstream elites and trade technocrats who pooh-poohed ordinary
people's concerns with earlier trade agreements.
The elites minimized distributional concerns, though they turned out to be significant for
the most directly affected communities. They oversold aggregate gains from trade deals, though
they have been smallish since at least NAFTA. They said sovereignty would not be diminished though
it clearly was in some instances. They claimed democratic principles would not be undermined,
though they are in places. They said there'd be no social dumping though there clearly is at times.
They advertised trade deals (and continue to do so) as "free trade" agreements, even though Adam
Smith and David Ricardo would turn over in their graves if they read, say, any of the TPP chapters.
And because they failed to provide those distinctions and caveats now trade gets tarred with
all kinds of ills even when it's not deserved. If the demagogues and nativists making nonsensical
claims about trade are getting a hearing, it is trade's cheerleaders that deserve some of the
blame.
One more thing. The opposition to trade deals is no longer solely about income losses. The
standard remedy of compensation won't be enough -- even if carried out. It's about fairness, loss
of control, and elites' loss of credibility. It hurts the cause of trade to pretend otherwise.
... ... ..
Trump would propose and/or enact, he listed the following six:
"A Constitutional Amendment to impose term limits on all members of Congress."
"A hiring freeze on all federal employees."
"A requirement that for every new federal regulation, 2 existing regulations must be eliminated."
"A 5-year ban on White House and Congressional officials becoming lobbyists after they leave government."
"A lifetime ban on White House officials lobbying on behalf of a foreign government."
"A complete ban on foreign lobbyists raising money for American elections."
"
~~WWW~
Lot of reform is needed but may be
The forgotten spirit of American protectionism : , -1
The free traders have human economic history precisely inverted. Countries that practice protectionism
almost uniformly become wealthy and technologically advanced. Countries that don't become or remain
terribly sad, poverty-stricken producers of worthless raw materials and desperate labor migrants.
This has been true at least going back to Byzantium and its economic conquest by Genoa and Venice.
That the US thrived pre-1970 free trade is no coincidence. There is no alternative to protectionism.
Free trade = no industry = no money = no future.
I think he is trying to talk about soft neoliberalism vs rejection of neoliberalism as discredited
economics dogma and ideology. I think like Marxism neoliberalism has religious elements in it (as in
"secular religion") so will not go away completely much like obscure religious cults does not dissapper
they on a given date second coming of Christ did not happen.
Notable quotes:
"... new research showing that policies like public housing , welfare and public education spending are more beneficial than conservatives have recognized in decades past. ..."
"... But there are not one, but two big trends in liberal economic thinking. One wants to modify the economic thinking of the past few decades, and the other wants to rip it up. I expect to see a lot of the economic debate in the coming years play out not between the left and right, but between these two strains of thought. ..."
"... The New Center-Left Consensus is attractive to academics and policy wonks. It draws on an eclectic mix of mainstream economic theory, empirical studies and historical experience. It refuses to assume, as many conservatives and libertarians do, that free markets are always the best unless there is a glaring case for government intervention. ..."
In 2015, Forbes writer Adam Ozimek
suggested that a "new liberal consensus" is forming in the economic-policy world. The data back
him up. Many economics professors now
tend to favor government intervention in the economy more than the general public. And the profession's
biggest public stars, from Paul Krugman to Thomas Piketty to Joseph Stiglitz, are now more likely
to lean
to the left than to the right. Meanwhile, I've tried to document the flood of new research
showing that policies like
public housing ,
welfare and public education
spending are more beneficial than conservatives have recognized in decades past.
But there are not one, but two big trends in liberal economic thinking. One wants to
modify the economic thinking of the past few decades, and the other wants to rip it up. I expect
to see a lot of the economic debate in the coming years play out not between the left and right,
but between these two strains of thought.
The research and people I've been writing about fit into what we might call the New Center-Left
Consensus. This strain of thought is based on data and empiricism. Support for higher minimum wages,
for example,
has grown among economists because a large amount of careful
empirical analysis has
shown that minimum wage hikes don't usually cause sizable immediate disruptions in local labor markets.
These economists aren't ignorant of the basic theory of labor supply and demand -- the kind that
every undergrad econ student is forced to learn. They just realize that
it might not be the right theory in this case.
The New Center-Left Consensus is attractive to academics and policy wonks. It draws on an
eclectic mix of mainstream economic theory, empirical studies and historical experience. It refuses
to assume, as many conservatives and libertarians do, that free markets are always the best unless
there is a glaring case for government intervention. It's more willing to entertain all kinds
of ways that government can improve the economy, from welfare to infrastructure spending to regulation,
but it also recognizes that these won't always work. It embraces a philosophy of careful experimentation.
Sometimes the new center-left is even in favor of deregulation -- for example, loosening
zoning restrictions and reducing
occupational licensing . It's not ideologically opposed to the free market.
The best evangelist of the New Center-Left Consensus might be President Barack Obama. In an amazingly
well-informed
editorial in the Economist, he recently laid out a comprehensive picture of the economy and policy.
I have little doubt that Obama's understanding was heavily informed by his chief economic adviser,
Jason Furman ,
who has become a titan of center-left policy advocacy. Obama mixes a healthy respect for capitalism
with a desire to use government to temper the market's excesses.
But there's a second strain of progressive economic thinking that is gaining attention and strength.
This alternative could be called the New Heterodox Explosion. It's basically a movement to purge
mainstream economics from progressive policy-making and thought.
The New Heterodox Explosion rose in large part out of strongly left-leaning intellectual circles,
particularly sociology, the humanities and other disciplines outside economics. It has also found
a home in some economics departments in other countries (most notably the U.K.). Recently, it has
started to permeate blogs and the media.
The new website Evonomics , for example, is
heavily devoted to strongly worded critiques of the entire edifice of modern [neoliberal] economics
and it's where the work of many of the most outspoken champions of the New Heterodox Explosion appears.
These include evolutionary biologist David Sloan Wilson, activist and venture capitalist Nick Hanauer,
speechwriter Eric Liu and Eric Beinhocker of the Institute for New Economic Thinking. In a spate
of recent blog posts and editorials, these thinkers have
advocated replacing mainstream economic theory with thinking based on evolution, and/or on complexity
theory.
Though it's difficult to boil down these critiques to a few sentences, one basic theme of Wilson,
Hanauer, et al.'s thinking is that modern economics is based on selfishness. Mainstream theories
model human beings as atomistic individuals pursuing their own wants. But, say these Evonomics writers,
people are social beings who care a lot about their fellow humans, and are also deeply embedded in
larger social structures and organizations like communities, nations and cultures.
I'm sympathetic to this point of view. I'm not at all sure that economies can be completely understood
by looking at individual decisions, any more than I'm certain the growth of a tree can be understood
simply by looking at the motions of the particles in the leaves and roots. And I do wish that economists
dedicated a lot more thought and attention to the phenomena they call "
externalities "
and "
social preferences ."
But I'm also very wary of applying the Evonomics ideas to policy-making without a lot more work.
First, the connection to evolution and complexity theory often seems less than solid. Nobody
really knows if economies evolve the way organisms do. And efforts to connect complexity theory
to economics, led by the Santa Fe Institute
, have been going on for quite some time without any dramatic breakthroughs.
So while the New Center-Left Consensus is fully formed and ready for application in the real world,
the New Heterodox Explosion is still in its infancy. Center-left ideas have tons of very careful
academic empirical work behind them, while those wishing to tear up economics and start over are
still working mostly with broad analogies. I hope that the New Heterodox Explosion -- which of course
extends far beyond the few writers and ideas I've cited in this post -- becomes a rich source of
new and innovative economic ideas. But it still has a long way to go to match the intellectual heft
of the center-left.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and
its owners.
Noah Smith is a Bloomberg View columnist. He was an assistant professor of finance at Stony
Brook University, and he blogs at Noahpinion.
CETA's collapse is equivalent to the Budapest COMECON council session of
28/6/91. Corporate central planning has flopped down dead alongside Soviet
central planning. The Western Bloc is finally breaking up.
The Walloons, part of a barely real country. The Walloons, who brought you
much of Belgian colonialism, which got a bad name even among colonialists. The
Walloons, who oppressed the Flemings. There were cases of Dutch speakers being
condemned to death in courts that were in French and refused to provide
translation.
And yet the Walloons, a singularly unsuccessful people, are derailing a bad
trade deal.
Enlightening times. And times in which we cannot assume that we know where
our allies will come from.
Liberation weighs in with an interesting analysis: La Vallonie considers
CETA to be a Trojan horse bearing the subsidiaries of U.S. companies into
Belgium:
Shipping: "China is to build a deepwater tanker port in Malaysia off the
Malacca Strait, a key gateway for Chinese oil imports.The $1.9bn port,
located on the coast of Malacca City, will be able to accommodate very large
crude carriers" [Lloyd's List].
But, if the point of the TPP is to hem in China by excluding them and
bringing Malaysia into our "orbit" then why would they do this?
Unless, of course they know that any deal will make Malaysia a key gateway
to the American market and thus allow them to use it to wash their goods
through the TPP for cheap market access in the exact same way that they do it
now via Mexico.
It appears Belgium's Wallonia has put a nail on the coffin
of the EU-Canada trade agreement (CETA) by vetoing it. The
reasons, The Economist puts it, "are hard to understand."
Well, yes and no. Canada is one of the most progressive
trade partners you could hope to have, and it is hard to
believe that Walloon incomes or values are really being
threatened. But clearly something larger than the specifics
of this agreement is at stake here.
Instead of decrying people's stupidity and ignorance in
rejecting trade deals, we should try to understand why such
deals lost legitimacy in the first place. I'd put a large
part of the blame on mainstream elites and trade technocrats
who pooh-poohed ordinary people's concerns with earlier trade
agreements.
The elites minimized distributional concerns, though they
turned out to be significant for the most directly affected
communities. They oversold aggregate gains from trade deals,
though they have been smallish since at least NAFTA. They
said sovereignty would not be diminished though it clearly
was in some instances. They claimed democratic principles
would not be undermined, though they are in places. They said
there'd be no social dumping though there clearly is at
times. They advertised trade deals (and continue to do so) as
"free trade" agreements, even though Adam Smith and David
Ricardo would turn over in their graves if they read, say,
any of the TPP chapters.
And because they failed to provide those distinctions and
caveats now trade gets tarred with all kinds of ills even
when it's not deserved. If the demagogues and nativists
making nonsensical claims about trade are getting a hearing,
it is trade's cheerleaders that deserve some of the blame.
One more thing. The opposition to trade deals is no longer
solely about income losses. The standard remedy of
compensation won't be enough -- even if carried out. It's
about fairness, loss of control, and elites' loss of
credibility. It hurts the cause of trade to pretend
otherwise.
Reply
Saturday, October 22, 2016 at 09:32 AM
Peter K. -> Peter K....
, -1
Wallonia is adamantly blocking the EU's trade deal with
Canada
"HEY Canada, f!@# you." Within hours this tweet (the
result of a hack) from the Belgian foreign minister's account
was replaced with a friendlier message: "keep calm and love
Canada". Yet his country's actions are closer to the
original. On October 14th the regional parliament of Wallonia
voted to block the Comprehensive Economic and Trade Agreement
(CETA), a trade deal between the European Union and Canada.
As Europeans assess the fallout from the U.K.'s
Brexit referendum
, they face a series of elections that could equally shake the political establishment. In the
coming 12 months, four of Europe's five largest economies have votes that will almost certainly mean
serious gains for right-wing populists and nationalists. Once seen as fringe groups, France's National
Front, Italy's Five Star Movement, and the Freedom Party in the Netherlands have attracted legions
of followers by tapping discontent over immigration, terrorism, and feeble economic performance.
"The Netherlands should again become a country of and for the Dutch people," says Evert Davelaar,
a Freedom Party backer who says immigrants don't share "Western and Christian values."
... ... ....
The populists are deeply skeptical of European integration, and those in France and the Netherlands
want to follow Britain's lead and quit the European Union. "Political risk in Europe is now far more
significant than in the United States," says Ajay Rajadhyaksha, head of macro research at Barclays.
... ... ...
...the biggest risk of the nationalist groundswell: increasingly fragmented parliaments that will
be unable or unwilling to tackle the problems hobbling their economies. True, populist leaders might
not have enough clout to enact controversial measures such as the Dutch Freedom Party's call to close
mosques and deport Muslims. And while the Brexit vote in June helped energize Eurosceptics, it's
unlikely that any major European country will soon quit the EU, Morgan Stanley economists wrote in
a recent report. But they added that "the protest parties promise to turn back the clock" on free-market
reforms while leaving "sclerotic" labour and market regulations in place. France's National Front,
for example, wants to temporarily renationalise banks and increase tariffs while embracing cumbersome
labour rules widely blamed for chronic double-digit unemployment. Such policies could damp already
weak euro zone growth, forecast by the International Monetary Fund to drop from 2 percent in 2015
to 1.5 percent in 2017. "Politics introduces a downside skew to growth," the economists said.
TPP: "CLINTON ADVISERS WALK THE KNIFE'S EDGE ON TPP: The hand wringing over Clinton's stance on the
TPP was even more evident in another batch of hacked emails posted by WikiLeaks on Wednesday. The
exchange from Oct. 6, like other emails allegedly* from the account of Clinton campaign chairman
John Podesta, is focused on the Democratic candidate's statement following the conclusion of TPP
negotiations last October and how to balance the former secretary of State's previous support for
the deal with demands from her base. 'The goal here was to
minimize our vulnerability to the
authenticity attack
and not piss off the WH [White House] any more than necessary," wrote chief
speechwriter Dan Schwerin when sending out a draft of the statement" [
Politico
].
The secret of success is sincerity. Once you can fake that, you've got it made. * Politico, can we
can get an asterisk on that allegedly? Something like "* Bob from Legal made us put this 'allegedly'
in, after he got a call from John." What say?
TPP: "El Salvador Ruling Offers a Reminder of Why
the TPP Must Be Defeated" [
The
Nation
(Re Silc)]. "Last week, the tribunal at the center of the proposed TPP ruled against a
global mining firm that sued El Salvador, but only after seven years of deliberations and over $12
million spent by the government of El Salvador. Equally outrageous, legal shenanigans by the Australian-Canadian
firm OceanaGold around corporate ownership will likely prevent El Salvador from ever recouping a
cent…. [N]o one should be complacent about defeating the TPP. Despite Hillary Clinton's professed
opposition to the agreement, she is not picking up the phone to convince members of Congress to vote
no."
TPP: "The Case for the TPP: Responding to the Critics" [
United
States Chamber of Commerce
]. These guys are rolling in dough. Is this really the best they can
do? Claim: "The TPP Will Undermine Regulations Protecting Health, Safety and the Environment."The
COC's answer: "ISDS has been included in approximately 3,000 investment treaties and trade agreements
over the past five decades. These neutral arbitrators have no power to overturn laws or regulations;
they can only order compensation." In the billions, right? No chilling effect there!
TISA: "Meanwhile, news out of Europe cast doubt on whether negotiators will actually finish TISA
this year because the EU cannot agree on how to handle cross-border data flows. The European Commission's
trade and justice departments have been squabbling for months over the issue, which Froman acknowledged
is an important outstanding concern. EU trade officials want data flows included in the pact, opening
up new markets for Europe's data economy to expand, while data protection officials are more concerned
about strong safeguards for privacy" [
Politico
].
This guy is die hard neoliberal. That's why he is fond of Washington consensus. He does not understand
that the time is over for Washington consensus in 2008. this is just a delayed reaction :-)
Notable quotes:
"... after years of unusually sluggish and strikingly non-inclusive growth, the consensus is breaking down. Advanced-country citizens are frustrated with an "establishment" – including economic "experts," mainstream political leaders, and dominant multinational companies – which they increasingly blame for their economic travails. ..."
"... Anti-establishment movements and figures have been quick to seize on this frustration, using inflammatory and even combative rhetoric to win support. They do not even have to win elections to disrupt the transmission mechanism between economics and politics. ..."
"... They also included attacks on "international elites" and criticism of Bank of England policies that were instrumental in stabilizing the British economy in the referendum's immediate aftermath – thus giving May's new government time to formulate a coherent Brexit strategy. ..."
"... The risk is that, as bad politics crowds out good economics, popular anger and frustration will rise, making politics even more toxic. ..."
"... At one time, the people's government served as a check on the excesses of economic interests -- now, it is simply owned by them. ..."
"... The defects of the maximalist-globalist view were known for years before the "consensus began to break down". ..."
"... In at least some of these cases, the "transmission" of the consensus involved more than a little coercion and undermining local interests, sovereignty, and democracy. This is an central feature of the "consensus", and it is hard to see how it can by anything but irredeemable. ..."
"... However it is not bad politics crowding out out good economics, for the simple reason that the economic "consensus" itself, in embracing destructive and destabilizing economic policy crowded out the ostensibly centrist politics... ..."
"... The Inclusive Growth has remained only a Slogan and Politicians never ventured into the theme. In the changed version of the World.] essential equal opportunity and World of Social media, perspective and social Political scene is changed. Its more like reverting to mean. ..."
In the 1990s and 2000s, for example, the so-called Washington Consensus dominated policymaking
in much of the world...
... ... ...
But after years of unusually sluggish and strikingly non-inclusive growth, the consensus is
breaking down. Advanced-country citizens are frustrated with an "establishment" – including economic
"experts," mainstream political leaders, and dominant multinational companies – which they increasingly
blame for their economic travails.
Anti-establishment movements and figures have been quick to seize on this frustration, using
inflammatory and even combative rhetoric to win support. They do not even have to win elections to
disrupt the transmission mechanism between economics and politics. The United Kingdom proved
that in June, with its Brexit vote – a decision that directly defied the broad economic consensus
that remaining within the European Union was in Britain's best interest.
... ... ...
... speeches by Prime Minister Theresa May and members of her cabinet revealed an intention to
pursue a "hard Brexit," thereby dismantling trading arrangements that have served the economy well.
They also included attacks on "international elites" and criticism of Bank of England policies
that were instrumental in stabilizing the British economy in the referendum's immediate aftermath
– thus giving May's new government time to formulate a coherent Brexit strategy.
Several other advanced economies are experiencing analogous political developments. In Germany,
a surprisingly strong showing by the far-right Alternative für Deutschland in recent state
elections already appears to be affecting the government's behavior.
In the US, even if Donald Trump's presidential campaign fails to put a Republican back in the
White House (as appears increasingly likely, given that, in the latest twist of this highly unusual
campaign, many Republican leaders have now renounced their party's nominee), his candidacy will likely
leave a lasting impact on American politics. If not managed well, Italy's constitutional referendum
in December – a risky bid by Prime Minister Matteo Renzi to consolidate support – could backfire,
just like Cameron's referendum did, causing political disruption and undermining effective action
to address the country's economic challenges.
... ... ...
The risk is that, as bad politics crowds out good economics, popular anger and frustration
will rise, making politics even more toxic. ...
Mr El-Erian, I know you are a good man, but it seems as though everyone believes we can synthetically
engineer a way out of this never ending hole that financial engineering dug us into in the first
place.
Instead why don't we let this game collapse, you are a good man and you will play a role in
the rebuilding of better system, one that nurtures and guides instead of manipulate and lie.
The moral suasion you mention can only appear by allowing for the self annihilation of this
financial system. This way we can learn from the autopsies and leave speculative theories to third
rate economists
It is sadly true that "the relationship between politics and economics is changing," at least
in the U.S.. At one time, the people's government served as a check on the excesses of economic
interests -- now, it is simply owned by them.
It seems to me that the best we can hope for now is some sort of modest correction in the relationship
after 2020 -- and that the TBTF banks won't deliver another economic disaster in the meantime.
Petey Bee OCT 15, 2016
1. The defects of the maximalist-globalist view were known for years before the "consensus
began to break down".
2. In at least some of these cases, the "transmission" of the consensus involved more than
a little coercion and undermining local interests, sovereignty, and democracy. This is an central
feature of the "consensus", and it is hard to see how it can by anything but irredeemable.
In the concluding paragraph, the author states that the reaction is going to be slow. That's absolutely
correct, the evidence has been pushed higher and higher above the icy water line since 2008.
However it is not bad politics crowding out out good economics, for the simple reason that
the economic "consensus" itself, in embracing destructive and destabilizing economic policy crowded
out the ostensibly centrist politics...
Paul Daley OCT 15, 2016
The Washington consensus collapsed during the Great Recession but the latest "consensus" among
economists regarding "good economics" deserves respect.
atul baride OCT 15, 2016
The Inclusive Growth has remained only a Slogan and Politicians never ventured into the theme.
In the changed version of the World.] essential equal opportunity and World of Social media, perspective
and social Political scene is changed. Its more like reverting to mean.
"... If you insist on focusing on individuals, you may miss the connection, because the worst off
within communities - actual chronic discouraged workers, addicts - are likely to express no opinion
to the degree they can be polled at all. Trump primary voters are white Republicans who vote, automatically
a more affluent baseline* than the white voters generally. ..."
EMichael quotes Steve Randy Waldman and Dylan Matthews in today's links:
""Trump voters, FiveThirtyEight's Nate Silver found, had a median household income of $72,000,
a fair bit higher than the $62,000 median household income for non-Hispanic whites in America."
...
""But it is also obvious that, within the Republican Party, Trump's support comes disproportionately
from troubled communities, from places that have been left behind economically, that struggle
with unusual rates of opiate addiction, low educational achievement, and other social vices."
I followed the link and failed to find any numbers on the "troubled communities" thing. It
seems strange to me that the two comments above are in conflict with each other."
It seems like you are missing the point of Waldman's blog post (and Stiglitz and Shiller)
You didn't quote this part:
"... If you insist on focusing on individuals, you may miss the connection, because the
worst off within communities - actual chronic discouraged workers, addicts - are likely to express
no opinion to the degree they can be polled at all. Trump primary voters are white Republicans
who vote, automatically a more affluent baseline* than the white voters generally.
"Among Republicans, Trump supporters have slightly lower incomes. But what really differentiates
them?"]
"At the community level**, patterns are clear. (See this*** too.) Of course, it could still
all be racism, because within white communities, measures of social and economic dysfunction are
likely correlated with measures you could associate with racism."
Of course, it could still all be racism, because within white communities, measures of social
and economic dysfunction are likely correlated with measures you could associate with racism.
Social affairs are complicated and the real world does not hand us unique well-identified models.
We always have to choose our explanations,**** and we should think carefully about how and why
we do so. Explanations have consequences, not just for the people we are imposing them upon, but
for our polity as a whole. I don't get involved in these arguments to express some high-minded
empathy for Trump voters, but because I think that monocausally attributing a broad political
movement to racism when it has other plausible antecedents does real harm....
"... ...Trump referred explicitly to "the disenfranchisement of working people" ..."
"... Trump denounced the "global power structure that is responsible for the economic decisions that have robbed our working class, stripped our country of its wealth and put that money into the pockets of a handful of large corporations and political entities." ..."
"... He continued: "Just look at what this corrupt establishment has done to our cities like Detroit and Flint, Michigan-and rural towns in Pennsylvania, Ohio, North Carolina and across our country. They have stripped these towns bare, and raided the wealth for themselves and taken away their jobs." ..."
"... He went on to cite internal Clinton campaign emails published by WikiLeaks this week, documenting how, as Trump put it, "Hillary Clinton meets in secret with international banks to plot the destruction of US sovereignty in order to enrich these global financial powers." ..."
"... The Clinton campaign, warned of the impending release of masses of politically incriminating documents by WikiLeaks, sought to preempt this exposure by denouncing the leaks as a conspiracy engineered by Russia and its president, Vladimir Putin. ..."
"... Clinton is appealing for support from sections of the Republican Party, above all the neo-conservatives of the George W. Bush administration, responsible for the war in Iraq, the widespread use of torture and other crimes. ..."
"... The anti-Russian campaign has been combined with an effort to demonize Trump for a series of purported sexual offenses, with a barrage of video and audio recordings, together with the testimony of alleged victims. ..."
"... The Democratic campaign and its media allies are using methods similar to those the ultra-right employed in its efforts to oust Bill Clinton from the White House in the 1990s. They are seeking to stampede public opinion with increasingly sensationalized material. These methods degrade political discussion and distract popular consciousness from the real issues in the election. ..."
In a speech delivered by Donald Trump to an audience of thousands in West Palm Beach, Florida, the
Republican candidate turned his campaign in a more distinctly fascistic direction. Presenting himself
as both the savior of America and the victim of a ruthless political and economic establishment,
Trump sought to connect deep-seated social anger among masses of people with an "America First" program
of anti-immigrant xenophobia, militarism, economic nationalism and authoritarianism.
Responding to the latest allegations of sexual abuse, Trump proclaimed that he is being targeted
by international bankers, the corporate-controlled media and the political establishment who fear
that his election will undermine their interests.
He offered as an alternative his own persona-the strong-man leader who is willing to bear the
burden and make the sacrifices necessary for a pitiless struggle against such powerful adversaries.
Trump warned that the November 8 election would be the last opportunity for the American people to
defeat the powerful vested interests that are supporting Hillary Clinton.
The clear implication of the speech is that if Trump loses the election, the struggle against
the political establishment will have to be carried forward by other means...
...
...Trump referred explicitly to "the disenfranchisement of working people" -with racist,
chauvinist and dictatorial solutions. This includes not only the demand for jailing Hillary Clinton,
now a refrain of every speech, but his calls for his supporters to prevent a "rigged" election by
blocking access to the polls for voters in "certain communities."
Trump denounced the "global power structure that is responsible for the economic decisions
that have robbed our working class, stripped our country of its wealth and put that money into the
pockets of a handful of large corporations and political entities."
He continued: "Just look at what this corrupt establishment has done to our cities like Detroit
and Flint, Michigan-and rural towns in Pennsylvania, Ohio, North Carolina and across our country.
They have stripped these towns bare, and raided the wealth for themselves and taken away their jobs."
He went on to cite internal Clinton campaign emails published by WikiLeaks this week, documenting
how, as Trump put it, "Hillary Clinton meets in secret with international banks to plot the destruction
of US sovereignty in order to enrich these global financial powers."
After the top congressional Republican, House Speaker Paul Ryan, publicly broke with Trump Monday,
declaring that he would neither campaign for him nor defend him, Trump responded with the declaration,
"It is so nice that the shackles have been taken off me and I can now fight for America the way I
want to."
... ... ...
The Clinton campaign, warned of the impending release of masses of politically incriminating
documents by WikiLeaks, sought to preempt this exposure by denouncing the leaks as a conspiracy engineered
by Russia and its president, Vladimir Putin.
Clinton is appealing for support from sections of the Republican Party, above all the neo-conservatives
of the George W. Bush administration, responsible for the war in Iraq, the widespread use of torture
and other crimes.
The anti-Russian campaign has been combined with an effort to demonize Trump for a series
of purported sexual offenses, with a barrage of video and audio recordings, together with the testimony
of alleged victims.
The Democratic campaign and its media allies are using methods similar to those the ultra-right
employed in its efforts to oust Bill Clinton from the White House in the 1990s. They are seeking
to stampede public opinion with increasingly sensationalized material. These methods degrade political
discussion and distract popular consciousness from the real issues in the election.
He missed the foreign policy aspect of Hillary vs Trump candidacy. A vote for Hillary is vote for
continuation of wars of expansion of neoliberal empire.
Notable quotes:
"... reforms that political leaders promised would ensure prosperity for all – such as trade and financial liberalization – have not delivered. Far from it. And those whose standard of living has stagnated or declined have reached a simple conclusion: America's political leaders either didn't know what they were talking about or were lying (or both). ..."
"... Thus, many Americans feel buffeted by forces outside their control, leading to outcomes that are distinctly unfair. Long-standing assumptions – that America is a land of opportunity and that each generation will be better off than the last – have been called into question. The global financial crisis may have represented a turning point for many voters: their government saved the rich bankers who had brought the US to the brink of ruin, while seemingly doing almost nothing for the millions of ordinary Americans who lost their jobs and homes. The system not only produced unfair results, but seemed rigged to do so. ..."
"... Support for Trump is based, at least partly, on the widespread anger stemming from that loss of trust in government. ..."
"... The simplistic neo-liberal market-fundamentalist theories that have shaped so much economic policy during the last four decades are badly misleading, with GDP growth coming at the price of soaring inequality. Trickle-down economics hasn't and won't work. Markets don't exist in a vacuum. The Thatcher-Reagan "revolution," which rewrote the rules and restructured markets for the benefit of those at the top, succeeded all too well in increasing inequality, but utterly failed in its mission to increase growth. ..."
But several underlying factors also appear to have contributed to the closeness of the race. For
starters, many Americans are economically worse off than they were a quarter-century ago. The median
income of full-time male employees is lower than it was 42 years ago, and it is increasingly difficult
for those with limited education to get a full-time job that pays decent wages.
Indeed, real (inflation-adjusted) wages at the bottom of the income distribution are roughly where
they were 60 years ago. So it is no surprise that Trump finds a large, receptive audience when he
says the state of the economy is rotten. But Trump is wrong both about the diagnosis and the prescription.
The US economy as a whole has done well for the last six decades: GDP has increased nearly six-fold.
But the fruits of that growth have gone to a relatively few at the top – people like Trump, owing
partly to massive tax cuts that he would extend and deepen.
At the same time, reforms that political leaders promised would ensure prosperity for all – such
as trade and financial liberalization – have not delivered. Far from it. And those whose standard
of living has stagnated or declined have reached a simple conclusion: America's political leaders
either didn't know what they were talking about or were lying (or both).
Trump wants to blame all of America's problems on trade and immigration. He's wrong. The US would
have faced deindustrialization even without freer trade: global employment in manufacturing has been
declining, with productivity gains exceeding demand growth.
Where the trade agreements failed, it was not because the US was outsmarted by its trading partners;
it was because the US trade agenda was shaped by corporate interests. America's companies have done
well, and it is the Republicans who have blocked efforts to ensure that Americans made worse off
by trade agreements would share the benefits.
Thus, many Americans feel buffeted by forces outside their control, leading to outcomes that are
distinctly unfair. Long-standing assumptions – that America is a land of opportunity and that each
generation will be better off than the last – have been called into question. The global financial
crisis may have represented a turning point for many voters: their government saved the rich bankers
who had brought the US to the brink of ruin, while seemingly doing almost nothing for the millions
of ordinary Americans who lost their jobs and homes. The system not only produced unfair results,
but seemed rigged to do so.
Support for Trump is based, at least partly, on the widespread anger stemming from that loss of
trust in government. But Trump's proposed policies would make a bad situation much worse. Surely,
another dose of trickle-down economics of the kind he promises, with tax cuts aimed almost entirely
at rich Americans and corporations, would produce results no better than the last time they were
tried.
In fact, launching a trade war with China, Mexico, and other US trading partners, as Trump promises,
would make all Americans poorer and create new impediments to the global cooperation needed to address
critical global problems like the Islamic State, global terrorism, and climate change. Using money
that could be invested in technology, education, or infrastructure to build a wall between the US
and Mexico is a twofer in terms of wasting resources.
There are two messages US political elites should be hearing. The simplistic neo-liberal market-fundamentalist
theories that have shaped so much economic policy during the last four decades are badly misleading,
with GDP growth coming at the price of soaring inequality. Trickle-down economics hasn't and won't
work. Markets don't exist in a vacuum. The Thatcher-Reagan "revolution," which rewrote the rules
and restructured markets for the benefit of those at the top, succeeded all too well in increasing
inequality, but utterly failed in its mission to increase growth.
This leads to the second message: we need to rewrite the rules of the economy once again, this
time to ensure that ordinary citizens benefit. Politicians in the US and elsewhere who ignore this
lesson will be held accountable. Change entails risk. But the Trump phenomenon – and more than a
few similar political developments in Europe – has revealed the far greater risks entailed by failing
to heed this message: societies divided, democracies undermined, and economies weakened.
The Hillary Clinton campaign says the hackers behind the leaked
email evidence of their collusion with the major media are from
Russia and linked to the Russian regime. If so, I want to publicly
thank those Russian hackers and their leader, Russian President
Vladimir Putin, for opening a window into the modern workings of
the United States government-corporate-media establishment.
We always knew that the major media were extensions of the
Democratic Party. But the email evidence of how figures like
Maggie
Haberman
of The New York Times,
Juliet
Eilperin
of The Washington Post, and
John
Harwood
of CNBC worked hand-in-glove with the Democrats is
important. The Daily Caller and Breitbart have led the way in
digging through the emails and exposing the nature of this
evidence. It is shocking even to those of us at Accuracy in Media
who always knew about, and had documented, such collusion through
analysis and observation.
The Clinton campaign and various intelligence officials insist
that the purpose of the Russian hacking is to weaken the confidence
of the American people in their system of government, and to
suggest that the American system is just as corrupt as the Russian
system is alleged to be. Perhaps our confidence in our system
should be shaken. The American people can see that our media are
not independent of the government or the political system and, in
fact, function as an arm of the political party in control of the
White House that wants to maintain that control after November 8.
In conjunction with other evidence, including the ability to
conduct vote fraud that benefits the Democrats, the results on
Election Day will be in question and will form the basis for Donald
J. Trump to continue to claim that the system is "rigged" against
outsiders like him.
The idea of an American system of free and fair elections that
includes an honest press has been terribly undermined by the
evidence that has come to light. We are not yet to the point of the
Russian system, where opposition outlets are run out of business
and dissidents killed in the streets. That means that the Russians
have not completely succeeded in destroying confidence in our
system. But we do know that federal agencies like the Federal
Election Commission (FEC) and Federal Communications Commission
(FCC) are poised to strike blows against free and independent
media. Earlier this year the three Democrats on the FEC
voted
to punish
filmmaker Joel Gilbert for distributing a film
critical of President Barack Obama during the 2012 campaign.
The New York Times is
reporting
that
Clinton campaign chairman John Podesta has been contacted by the
FBI about the alleged Russian hackers behind the leaks of his
emails. This is what Podesta and many in the media want to talk
about.
But the Russians, if they are responsible, have performed a
public service. And until there is a thorough house-cleaning of
those in the major media who have made a mockery of professional
journalism, the American people will continue to lack confidence in
their system. The media have been caught in the act of sabotaging
the public's right to know by taking sides in the presidential
contest. They have become a propaganda arm of the Democratic Party,
coordinating with the Hillary Clinton for president campaign, which
apparently was being run out of Georgetown University, where John
Podesta was based. Many emails carry the web address of
[email protected], a reference to the Georgetown
University position held by the chairman of the 2016 Hillary
Clinton presidential campaign. Podesta is a Visiting Professor at
Georgetown University Law Center. His other affiliations include
the George Soros-funded Center for American Progress and the United
Nations High Level Panel on the Post-2015 Development Agenda.
Podesta and the other members of this U.N. panel had proposed "
A
New Global Partnership for the World
," which advocated for a
"profound economic transformation" of the world's economic order
that would result in a new globalist system. Shouldn't the American
people be informed about what Podesta and his Democratic allies
have planned for the United States should they win on November 8?
That Podesta would serve the purposes of the U.N. is not a
surprise. But it is somewhat surprising that he would use his base
at Georgetown University to run the Hillary campaign. On the other
hand, Georgetown, the nation's oldest Catholic and Jesuit
university,
describes
itself
as preparing "the next generation of global citizens to lead and
make a difference in the world."
When a Catholic university serves as the base for the election
of a Democratic Party politician committed to taxpayer-funded
abortion on demand and transgender rights, you know America's
political system and academia are rotten to the core. The
disclosure from WikiLeaks that Podesta used his Georgetown email to
engage in party politics only confirms what we already knew.
If the Russians are ultimately responsible for the release of
these emails, some of which
show
an anti-Catholic animus
on the part of Clinton campaign
officials, we are grateful to them. The answer has to be to clean
out the American political system of those who corrupt it and
demonstrate to the world that we can achieve higher standards of
integrity and transparency.
For its part, Georgetown University should be stripped of its
Catholic affiliation and designated as an official arm of the
Democratic Party.
Paul Kersey
balolalo
Oct 14, 2016 12:02 PM
The well deserved hatred for Hillary and the globalists is so
great, that at least 40% of the males in this country would back
anyone who went up against the Clintons. That's just not the
same thing as "BUYING TRUMPS BULLSHIT HOOK, LINE, AND SINKER".
Trump is exposing the corruption and the hypocrisy of the
Clintons in a way that no one has ever had the guts to do in the
past. He's doing it on national TV with a large national
audience. With Trump we may get anarchy, but with the Clintons,
Deep State is guaranteed. It is Deep State that is working
overtime to finish building the expressway to neofeudalism.
Killary only can beg that voters hold their noses and vote for her. Guardian neoliberal presstitutes
still don't want to understand that Hillary is more dangerous then trump, Sge with her attempt that
she is more militant then male neocons can really provoke a confrontation with Russia or China.
Notable quotes:
"... War at home versus another foreign war, nothing will get through Congress, and either will get impeached...so third party all the way for me. ..."
"... Keep in mind, the election is not over and that drip, drip, drip of Hillary emails may push more people towards Trump. ..."
"... Shameless. Absolutely shameless, Guardian. This is not-even-disguised Clinton sycophancy... ..."
"... Clinton has everything going for her. The media, the banks, big business, the UN, foreign leaders, special interest lobbyists, silicon valley, establishment Republicans. How can she not win in an landslide?! ..."
"... We came, we saw, and he grabbed some pussy. ..."
"... It seems nobody wants to talk about what is really going on here - instead we are fed this bilge from both sides about 'sexual misconduct' and other fluff ..."
"... The stagnation of middle-class incomes in the West may last another five decades or more. ..."
"... This calls into question either the sustainability of democracy under such conditions or the sustainability of globalization. ..."
"... These classes of "globalization losers," particularly in the United States, have had little political voice or influence, and perhaps this is why the backlash against globalization has been so muted. They have had little voice because the rich have come to control the political process. The rich, as can be seen by looking at the income gains of the global top 5 percent in Figure 1, have benefited immensely from globalization and they have keen interest in its continuation. ..."
"... But while their use of political power has enabled the continuation of globalization, it has also hollowed out national democracies and moved many countries closer to becoming plutocracies. Thus, the choice would seem either plutocracy and globalization – or populism and a halt to globalization. ..."
The vast majority of her support comes from people that will be holding their noses as they vote
for her. Seems to me that convincing those same people that you have it in the bag will just cause
them to think voting isn't worth their time since they don't want to anyway.
I know Trump's supporters, the real ones, and the anyone-but-Hillary club will show up as well.
Funny if this backfires and he wins.
I won't be voting for either one and couldn't care less which one wins. War at home versus
another foreign war, nothing will get through Congress, and either will get impeached...so third
party all the way for me.
"Trump has to be the limit, and there has to be a re-alignment"
Trump has shown one must fight fire with fire. The days of the meek and mild GOP are over. Twice
they tried with nice guys and failed. Trump has clearly shown come out with both fists swinging
and you attract needed media and you make the conversation about you. Trump's mistake was not
seeking that bit of polish that leaves your opponent on the floor.
Keep in mind, the election is not over and that drip, drip, drip of Hillary emails may
push more people towards Trump.
Shameless. Absolutely shameless, Guardian. This is not-even-disguised Clinton sycophancy...
tugend49
For every woman that's been sexually harassed, bullied, raped, assaulted, catcalled, groped,
objectified, and treated lesser than, a landslide victory for Clinton would be an especially sweet
"Fuck You" to the Trumps of this world.
Clinton has everything going for her. The media, the banks, big business, the UN, foreign
leaders, special interest lobbyists, silicon valley, establishment Republicans. How can she not
win in an landslide?!
It might be a reaction against Trump, but it's also a depressing example of the power of the
establishment, and their desire for control in democracy. Just look at how they squealed at Brexit.
It seems nobody wants to talk about what is really going on here - instead we are fed this
bilge from both sides about 'sexual misconduct' and other fluff
There is a report from two years ago, July 2014, before the candidates had even been selected,
by the economist Branko Milanovic for Yale 'Global' about the impact of Globalisation on the Lower
Middle Classes in the West and how this was basically going to turn into exactly the choice the
American electorate is facing now
Why won't the media discuss these issues instead of pushing this pointless circus?
These are the penultimate paragraphs of the article on the report (there is a similar one for
the Harvard Business Review
here ):
The populists warn disgruntled voters that economic trends observed during the past three
decades are just the first wave of cheap labor from Asia pitted in direct competition with
workers in the rich world, and more waves are on the way from poorer lands in Asia and Africa.
The stagnation of middle-class incomes in the West may last another five decades or more.
This calls into question either the sustainability of democracy under such conditions
or the sustainability of globalization.
If globalization is derailed, the middle classes of the West may be relieved from the immediate
pressure of cheaper Asian competition. But the longer-term costs to themselves and their countries,
let alone to the poor in Asia and Africa, will be high. Thus, the interests and the political
power of the middle classes in the rich world put them in a direct conflict with the interests
of the worldwide poor.
These classes of "globalization losers," particularly in the United States, have had
little political voice or influence, and perhaps this is why the backlash against globalization
has been so muted. They have had little voice because the rich have come to control the political
process. The rich, as can be seen by looking at the income gains of the global top 5 percent
in Figure 1, have benefited immensely from globalization and they have keen interest in its
continuation.
But while their use of political power has enabled the continuation of globalization, it
has also hollowed out national democracies and moved many countries closer to becoming plutocracies.
Thus, the choice would seem either plutocracy and globalization – or populism and a halt to
globalization.
Globalisation will continue to happen. It has pulled a large part of the world population out
of poverty and grown the global economy.
Sure on the downside it has also hugely benefitted the 1%, while the western middle classes
have done relatively less well and blue collar workers have suffered as they seek to turn to other
types (less well paid) of work.
The issue is the speed of change, how to manage globalisation and spread the wealth more equitably.
Maybe it will require slowing but it cannot and should not be stopped.
"... Now we're in a situation in which superexploitation options are largely gone. Routine profit generation has become difficult due to global productive overcapacity, leading to behavioral sinkish behavior like the US cannibalizing its public sector to feed capital. ..."
"... Since the late 19th century US foreign policy has been organized around the open markets mantra. It may be possible for the Chinese, with their greater options for economy manipulation, to avoid the crashes the US feared from lack of market access. ..."
"... But the current situation on its face does not have anything like the colonial escape valve available in the 19th century. ..."
"... To the extent that colonialism or neocolonialism does not actually hold fixed boundary ground is irrelevant, since assets are more differential and flexible needing only corporate law to sustain strict boundaries on possession or instruments that convert to the same power over assets. No one, of course, wants to assess stocks and bonds as instruments of global oppression or exploitation that far exceeds 19th century's crude colonial rule. ..."
"... The TPP is a corporate power grab, a 5,544-page document that was negotiated in secret by big corporations while Congress, the public, and unions were locked out. ..."
"... Multinationals like Google, Exxon, Monsanto, Goldman Sachs, UPS, FedEx, Apple, and Walmart are lobbying hard for it. Virtually every union in the U.S. opposes it. So do major environmental, senior, health, and consumer organizations. ..."
"... The TPP will mean fewer jobs and lower wages, higher prices for prescription drugs, the loss of regulations that protect our drinking water and food supply, and the loss of Internet freedom. It encourages privatization, undermines democracy, and will forbid many of the policies we need to combat climate change ..."
"... "Though the Obama administration touts the pact's labor and environmental protections, the official Labor Advisory Committee on the TPP strongly opposes it, arguing that these protections are largely unenforceable window dressing." ..."
global scenario that the down-to-earth presidents of China and Russia seem to have in mind
resembles the sort of balance of power that existed in Europe.
The article floats away here. China and Russia might want to have something that "resembles"
that time, but the analogy overlooks the fact that the relatively calm state of affairs -
Franco-Prussian war? - on the European continent after Napoleon coexisted with savage colonial
expansion. The forms of superexploitation thereby obtained did much to help stabilize Europe,
even as competition for colonial lands became more and more destabilizing and were part of what
led to WW1.
Now we're in a situation in which superexploitation options are largely gone. Routine profit
generation has become difficult due to global productive overcapacity, leading to behavioral
sinkish behavior like the US cannibalizing its public sector to feed capital.
Since the late 19th century US foreign policy has been organized around the open markets
mantra. It may be possible for the Chinese, with their greater options for economy manipulation,
to avoid the crashes the US feared from lack of market access.
But the current situation on its face does not have anything like the colonial escape valve
available in the 19th century.
Of course, duplicitous political COPORATISM means systems over a systemic characterized by
marked or even intentional deception that is now sustained and even spearheaded by state
systems.
Many contemporary liberal idealists living in urban strongholds of market mediated comfort
zones will not agree to assigning such strong description to an Obama administration. It is
too distant and remote to assign accountability to global international finance and currency
wars that have hegemonic hedge funds pumping and dumping crisis driven anarchy over global
exploit (ruled by market capital fright / fight and flight).
To the extent that colonialism or neocolonialism does not actually hold fixed boundary
ground is irrelevant, since assets are more differential and flexible needing only corporate
law to sustain strict boundaries on possession or instruments that convert to the same power
over assets. No one, of course, wants to assess stocks and bonds as instruments of global
oppression or exploitation that far exceeds 19th century's crude colonial rule.
Recall, however, how "joint stock" corporations first opened chartered exploit at global
levels under East and West Trading power aggregates that were profit driven enter-prize. So in
reality the current cross border market system of neoliberal globalization is, in fact, a
stealth colonialism on steroids.
TPP is part of that process in all its stealthy dimensions.
"The TPP is a corporate power grab, a 5,544-page document that was negotiated in secret
by big corporations while Congress, the public, and unions were locked out.
Multinationals like Google, Exxon, Monsanto, Goldman Sachs, UPS, FedEx, Apple, and Walmart
are lobbying hard for it. Virtually every union in the U.S. opposes it. So do major
environmental, senior, health, and consumer organizations.
The TPP will mean fewer jobs and lower wages, higher prices for prescription drugs, the
loss of regulations that protect our drinking water and food supply, and the loss of
Internet freedom. It encourages privatization, undermines democracy, and will forbid many
of the policies we need to combat climate change."
This is very handy, thanks. However the conclusion stops short of what the SCO is saying and
doing. They have no interest in an old-time balance of power. They want rule of law, a very
different thing. Look at Putin's Syria strategy: he actually complies with the UN Charter's
requirement to pursue pacific dispute resolution. That's revolutionary. When CIA moles in Turkey
shot that Russian jet down, the outcome was not battles and state-sponsored terror, as CIA
expected. The outcome was support for Turkey's sovereignty and rapprochement. Now when CIA starts
fires you go to Russia to put them out.
While China maintains its purist line on the legal principle of non-interference, it is
increasingly vocal in urging the US to fulfill its human rights obligations. That will sound
paradoxical because of intense US vilification of Chinese authoritarianism, but when you push for
your economic and social rights here at home, China is in your corner. Here Russia is leading by
example. They comply with the Paris Principles for institutionalized human rights protection
under independent international oversight. The USA does not.
When the USA goes the way of the USSR, we'll be in good hands. The world will show us how
developed countries work.
"RULE OF LAW" up front and personal (again?)
Now why would the USA be worried about global rule of law?
An Interesting ideal. No country above the law.
"…US President Barack Obama has vetoed a bill that would have allowed the families of the
victims of the September 11, 2001, attacks to sue the government of Saudi Arabia.
In a statement accompanying his veto message, Obama said on Friday he had
"deep sympathy" for the 9/11 victims' families and their desire to seek justice for
their relatives.
The president said, however, that the bill would be "detrimental to US national interests"
and could lead to lawsuits against the US or American officials for actions taken by groups
armed, trained or supported by the US.
"If any of these litigants were to win judgements – based on foreign domestic laws as
applied by foreign courts – they would begin to look to the assets of the US government held
abroad to satisfy those judgments, with potentially serious financial consequences for the
United States," Obama said."
-----------------------
To the tune of "Moma said…" by The Shirelles –
….Oh don't you know…Obama said they be days like this,
…..they would be days like this Obama said…
One interesting irony is that in Obama's TPP "The worst part is an Investor-State
Dispute Settlement provision, which allows a multinational corporation to sue to override
any U.S. law, policy, or practice that it claims could limit its future profits."
"Though the Obama administration touts the pact's labor and environmental protections, the
official Labor Advisory Committee on the TPP strongly opposes
it, arguing that these protections are largely unenforceable window dressing."
Britain's Economy Was Resilient After 'Brexit.'
Its Leaders Learned the Wrong Lesson.
http://nyti.ms/2dOx0Is
via @UpshotNYT
NYT - Neil Irwin - OCT. 10, 2016
This article must begin with a mea culpa. When British
voters decided in June that they wanted to depart the
European Union, I agreed with the conventional wisdom that
the British economy would probably slow and that uncertainty
put it at risk of recession.
Advocates of "Brexit" argued that was hogwash, and the
early evidence suggests they were right. For example, surveys
of purchasing managers showed that both the British
manufacturing and service sectors plummeted after the vote in
July, yet were comfortably expanding in August and September.
But the events of the last couple of weeks suggest that
British leaders are drawing the wrong conclusions from the
fact that their predictions proved right. The British
currency is plummeting again, most immediately because of
comments from French and German leaders suggesting they will
take a tough line in negotiating Brexit. But the underlying
reason is that the British government is ignoring the lessons
from the relatively benign immediate aftermath of the vote.
The British pound fell to about $1.24 on Friday from $1.30
a week earlier and continued edging down Monday. Even if you
treat a "flash crash" in the pound on Asian markets Thursday
night as an aberration - it fell 6 percent, then recovered in
a short span - these types of aberrations seem to happen only
when a market is already under severe stress. (See, for
example, the May 2010 flash crash of American stocks, during
a flare-up of the eurozone crisis).
Sterling, as traders refer to the currency, is acting as
the global market's minute-to-minute referendum on how
significant the economic disruption from Brexit will end up
being. So what does the latest downswing represent? It's
worth understanding why British financial markets and the
country's economy stabilized quickly after the Brexit vote to
begin with.
The vote set off a chaotic time of political disruption,
especially the resignation of the prime minister, David
Cameron, who had advocated for the country's remaining part
of the E.U. Theresa May won the internal battle to become the
next prime minister, which was to markets and business
decision makers a relatively benign result.
Down, Down, Down for the Pound
The British currency plummeted after the country's vote to
leave the European Union, and again this week.
(graph at the link: £ at ~$1.45 Jan-June 30,
then down to $1.30-1.35 thru Sep 30,
then plunging to $1.24.)
Ms. May, the former home secretary, is temperamentally
pragmatic. She reluctantly supported remaining in the union.
And while she pledged to follow through on leaving it
("Brexit means Brexit," she said), she seemed like the kind
of leader who would ensure that some of the worst-case
possibilities of how Brexit might go wouldn't materialize.
Exporters would retain access to European markets. London
could remain the de facto banking capital of Europe. All
would be well.
Meanwhile, the Bank of England sprang into action to
cushion the economic blow of Brexit-related uncertainty.
Despite the inflationary pressures created by a falling
pound, the bank, projecting loss of jobs and economic output,
cut interest rates and started a new program of quantitative
easing to try to soften the blow.
All of that - the prospect of "soft Brexit" and easier
monetary policy - helped financial markets stabilize and then
rally, and kept the economic damage mild, as the purchasing
managers' surveys show.
But in the last couple of weeks, the tenor has shifted.
The May government has sent a range of signals indicating
it will take a hard line in negotiations with European
governments over the terms of Brexit. At a conservative party
conference, she pledged to begin the "Article 50" process of
formally unwinding Britain's E.U. membership by the end of
March, declaring that the government's negotiators would
insist that Britain would assert control of immigration and
not be subject to decisions of the European Court of Justice.
That sets up confrontational negotiations between the
British government and its E.U. counterparts. European
leaders will be reluctant to allow Britain continued free
access to its markets, which the May government wants,
without similarly free movement of people across borders.
And beyond the substance of the negotiations, the British
government has signaled in recent days that it is looking
inward, and will be hostile to those who are not British
citizens. ...
The much-hyped severe Brexit
recession does not, so far, seem to be materializing – which
really shouldn't be that much of a surprise, because as I
warned, the actual economic case for such a recession was
surprisingly weak. (Ouch! I just pulled a muscle while
patting myself on the back!) But we are seeing a large drop
in the pound, which has steepened as it becomes likely that
this will indeed be a very hard Brexit. How should we think
about this?
Originally, stories about a pound plunge were tied to that
recession prediction: domestic investment demand would
collapse, leading to sustained very low interest rates, hence
capital flight. But the demand collapse doesn't seem to be
happening. So what is the story?
For now, at least, I'm coming at it from the trade side –
especially trade in financial services. It seems to me that
one way to think about this is in terms of the "home market
effect," an old story in trade but one that only got
formalized in 1980.
Here's an informal version: imagine a good or service
subject to large economies of scale in production, sufficient
that if it's consumed in two countries, you want to produce
it in only one, and export to the other, even if there are
costs of shipping it. Where will this production be located?
Other things equal, you would choose the larger market, so as
to minimize total shipping costs. Other things may not, of
course, be equal, but this market-size effect will always be
a factor, depending on how high those shipping costs are.
In one of the models I laid out in that old paper, the way
this worked out was not that all production left the smaller
economy, but rather that the smaller economy paid lower wages
and therefore made up in competitiveness what it lacked in
market access. In effect, it used a weaker currency to make
up for its smaller market.
In Britain's case, I'd suggest that we think of financial
services as the industry in question. Such services are
subject to both internal and external economies of scale,
which tends to concentrate them in a handful of huge
financial centers around the world, one of which is, of
course, the City of London. But now we face the prospect of
seriously increased transaction costs between Britain and the
rest of Europe, which creates an incentive to move those
services away from the smaller economy (Britain) and into the
larger (Europe). Britain therefore needs a weaker currency to
offset this adverse impact.
Does this make Britain poorer? Yes. It's not just the
efficiency effect of barriers to trade, there's also a
terms-of-trade effect as the real exchange rate depreciates.
But it's important to be aware that not everyone in
Britain is equally affected. Pre-Brexit, Britain was
obviously experiencing a version of the so-called Dutch
disease. In its traditional form, this referred to the way
natural resource exports crowd out manufacturing by keeping
the currency strong. In the UK case, the City's financial
exports play the same role. So their weakening helps British
manufacturing – and, maybe, the incomes of people who live
far from the City and still depend directly or indirectly on
manufacturing for their incomes. It's not completely
incidental that these were the parts of England (not
Scotland!) that voted for Brexit.
Is there a policy moral here? Basically it is that a
weaker pound shouldn't be viewed as an additional cost from
Brexit, it's just part of the adjustment. And it would be a
big mistake to prop up the pound: old notions of an
equilibrium exchange rate no longer apply.
Britain's Economy Was Resilient After 'Brexit.'
Its Leaders Learned the Wrong Lesson.
http://nyti.ms/2dOx0Is
via @UpshotNYT
NYT - Neil Irwin - OCT. 10, 2016
This article must begin with a mea culpa. When British
voters decided in June that they wanted to depart the
European Union, I agreed with the conventional wisdom that
the British economy would probably slow and that uncertainty
put it at risk of recession.
Advocates of "Brexit" argued that was hogwash, and the
early evidence suggests they were right. For example, surveys
of purchasing managers showed that both the British
manufacturing and service sectors plummeted after the vote in
July, yet were comfortably expanding in August and September.
But the events of the last couple of weeks suggest that
British leaders are drawing the wrong conclusions from the
fact that their predictions proved right. The British
currency is plummeting again, most immediately because of
comments from French and German leaders suggesting they will
take a tough line in negotiating Brexit. But the underlying
reason is that the British government is ignoring the lessons
from the relatively benign immediate aftermath of the vote.
The British pound fell to about $1.24 on Friday from $1.30
a week earlier and continued edging down Monday. Even if you
treat a "flash crash" in the pound on Asian markets Thursday
night as an aberration - it fell 6 percent, then recovered in
a short span - these types of aberrations seem to happen only
when a market is already under severe stress. (See, for
example, the May 2010 flash crash of American stocks, during
a flare-up of the eurozone crisis).
Sterling, as traders refer to the currency, is acting as
the global market's minute-to-minute referendum on how
significant the economic disruption from Brexit will end up
being. So what does the latest downswing represent? It's
worth understanding why British financial markets and the
country's economy stabilized quickly after the Brexit vote to
begin with.
The vote set off a chaotic time of political disruption,
especially the resignation of the prime minister, David
Cameron, who had advocated for the country's remaining part
of the E.U. Theresa May won the internal battle to become the
next prime minister, which was to markets and business
decision makers a relatively benign result.
Down, Down, Down for the Pound
The British currency plummeted after the country's vote to
leave the European Union, and again this week.
(graph at the link: £ at ~$1.45 Jan-June 30,
then down to $1.30-1.35 thru Sep 30,
then plunging to $1.24.)
Ms. May, the former home secretary, is temperamentally
pragmatic. She reluctantly supported remaining in the union.
And while she pledged to follow through on leaving it
("Brexit means Brexit," she said), she seemed like the kind
of leader who would ensure that some of the worst-case
possibilities of how Brexit might go wouldn't materialize.
Exporters would retain access to European markets. London
could remain the de facto banking capital of Europe. All
would be well.
Meanwhile, the Bank of England sprang into action to
cushion the economic blow of Brexit-related uncertainty.
Despite the inflationary pressures created by a falling
pound, the bank, projecting loss of jobs and economic output,
cut interest rates and started a new program of quantitative
easing to try to soften the blow.
All of that - the prospect of "soft Brexit" and easier
monetary policy - helped financial markets stabilize and then
rally, and kept the economic damage mild, as the purchasing
managers' surveys show.
But in the last couple of weeks, the tenor has shifted.
The May government has sent a range of signals indicating
it will take a hard line in negotiations with European
governments over the terms of Brexit. At a conservative party
conference, she pledged to begin the "Article 50" process of
formally unwinding Britain's E.U. membership by the end of
March, declaring that the government's negotiators would
insist that Britain would assert control of immigration and
not be subject to decisions of the European Court of Justice.
That sets up confrontational negotiations between the
British government and its E.U. counterparts. European
leaders will be reluctant to allow Britain continued free
access to its markets, which the May government wants,
without similarly free movement of people across borders.
And beyond the substance of the negotiations, the British
government has signaled in recent days that it is looking
inward, and will be hostile to those who are not British
citizens. ...
Reply
Tuesday,
Fred C. Dobbs -> Fred C. Dobbs...
,
Tuesday, October 11, 2016 at 07:17 AM
The much-hyped severe Brexit
recession does not, so far, seem to be materializing – which
really shouldn't be that much of a surprise, because as I
warned, the actual economic case for such a recession was
surprisingly weak. (Ouch! I just pulled a muscle while
patting myself on the back!) But we are seeing a large drop
in the pound, which has steepened as it becomes likely that
this will indeed be a very hard Brexit. How should we think
about this?
Originally, stories about a pound plunge were tied to that
recession prediction: domestic investment demand would
collapse, leading to sustained very low interest rates, hence
capital flight. But the demand collapse doesn't seem to be
happening. So what is the story?
For now, at least, I'm coming at it from the trade side –
especially trade in financial services. It seems to me that
one way to think about this is in terms of the "home market
effect," an old story in trade but one that only got
formalized in 1980.
Here's an informal version: imagine a good or service
subject to large economies of scale in production, sufficient
that if it's consumed in two countries, you want to produce
it in only one, and export to the other, even if there are
costs of shipping it. Where will this production be located?
Other things equal, you would choose the larger market, so as
to minimize total shipping costs. Other things may not, of
course, be equal, but this market-size effect will always be
a factor, depending on how high those shipping costs are.
In one of the models I laid out in that old paper, the way
this worked out was not that all production left the smaller
economy, but rather that the smaller economy paid lower wages
and therefore made up in competitiveness what it lacked in
market access. In effect, it used a weaker currency to make
up for its smaller market.
In Britain's case, I'd suggest that we think of financial
services as the industry in question. Such services are
subject to both internal and external economies of scale,
which tends to concentrate them in a handful of huge
financial centers around the world, one of which is, of
course, the City of London. But now we face the prospect of
seriously increased transaction costs between Britain and the
rest of Europe, which creates an incentive to move those
services away from the smaller economy (Britain) and into the
larger (Europe). Britain therefore needs a weaker currency to
offset this adverse impact.
Does this make Britain poorer? Yes. It's not just the
efficiency effect of barriers to trade, there's also a
terms-of-trade effect as the real exchange rate depreciates.
But it's important to be aware that not everyone in
Britain is equally affected. Pre-Brexit, Britain was
obviously experiencing a version of the so-called Dutch
disease. In its traditional form, this referred to the way
natural resource exports crowd out manufacturing by keeping
the currency strong. In the UK case, the City's financial
exports play the same role. So their weakening helps British
manufacturing – and, maybe, the incomes of people who live
far from the City and still depend directly or indirectly on
manufacturing for their incomes. It's not completely
incidental that these were the parts of England (not
Scotland!) that voted for Brexit.
Is there a policy moral here? Basically it is that a
weaker pound shouldn't be viewed as an additional cost from
Brexit, it's just part of the adjustment. And it would be a
big mistake to prop up the pound: old notions of an
equilibrium exchange rate no longer apply.
"... But if the third globalisation wave is mostly about taking advantage of cheap labour not commodities - whilst simultaneously reducing industrial capacity at home - today's global imbalances could result in a very different type of correction (something which may or may not be happening now). ..."
"... The immediate consequence may be the developed world's desire to engage in significant industrial on-shoring. ..."
"... I'm not convinced the end of globalization and the retrenchment of banking industry are the same thing. There are some things that can't be exp/imported. Maybe we just got to the point where it didn't make sense to order moules marinieres from Brussels!? ..."
"... You forget the third leg - reducing the price of labour for services via immigration of labour from poorer countries. On top of the supply-and-demand effects, it reduces social solidarity (see Robert Putnam) - of which trades union membership and activity is one indicator. It's a win-win for capital. ..."
According to strategists Bhanu Baweja, Manik Narain and Maximillian
Lin the elasticity of trade to GDP - a measure of wealth creating
globalisation - rose to as high as 2.2. in the so-called third wave
of globalisation which began in the 1980s. This compared to an
average of 1.5 since the 1950s. In the post-crisis era, however,
the elasticity of trade has fallen to 1.1, not far from the weak
average of the 1970s and early 1980s but well below the second and
third waves of globalisation.
... ... ...
The anti-globalist position has always been simple. Global trade isn't a net positive for anyone
if the terms of trade relationships aren't reciprocal or if the trade exists solely for the purpose
of taking advantage of undervalued local resources like labour or commodities whilst channeling
rents/profits to a single central beneficiary. That, they have always argued, makes it more akin to
an imperialistic relationship than a reciprocal one.
If the latest wave of "globalisation" is mostly an expression of
American imperialism, then it does seem logical it too will fade as
countries wake-up to the one-sided nature of the current global
value chains in place.
Back in the first wave of globalisation,
of course, much of the trade growth was driven by colonial empires
taking advantage of cheap commodity resources abroad in a bid to
add value to them domestically. When these supply chains unravelled,
that left Europe short of commodities but long industrial capacity
- a destabilising imbalance which coincided with two world wars.
Simplistically speaking, resource rich countries at this point
were faced with only two options: industrialising on their own
autonomous terms or be subjugated by even more oppressive
imperialist forces, which had even grander superiority agendas than
their old colonial foes. That left those empires boasting domestic
industrial capacity but lacking natural resources of their own,
with the option of fighting to defend the rights of their former
colonies in the hope that the promise of independence and friendly
future knowledge exchanges (alongside military protection) would be
enough to secure resource access from then on.
But if the third globalisation wave is mostly about taking
advantage of cheap labour not commodities - whilst simultaneously
reducing industrial capacity at home - today's global imbalances
could result in a very different type of correction (something
which may or may not be happening now).
The immediate consequence
may be the developed world's desire to engage in significant
industrial on-shoring.
But while reversing the off-shoring trend may boost productivity
in nations like the US or even in Europe, it's also likely to
reduce demand for mobile international capital as a whole. As UBS
notes, global cross border capital flows are already decelerating
significantly as a share of GDP post-crisis, and the peak-to-trough
swing in capital inflows to GDP over the past ten years has been
much more dramatic in developed markets than in emerging ones:
To note, in China trade as a % of GDP fell from
65% in 2006 to 42% in 2014. The relationship
between trade and GDP is in reality more variable
than is usually claimed.
I'm not convinced the end of globalization and
the retrenchment of banking industry are the same
thing. There are some things that can't be
exp/imported. Maybe we just got to the point
where it didn't make sense to order moules
marinieres from Brussels!?
"if the third globalisation wave is mostly about taking advantage of cheap labour not
commodities - whilst simultaneously reducing
industrial capacity at home"
You forget the third leg - reducing the
price of labour for services via immigration of
labour from poorer countries. On top of the
supply-and-demand effects, it reduces social
solidarity (see Robert Putnam) - of which trades
union membership and activity is one indicator.
It's a win-win for capital.
The simple problem with globalization is that it was based off economic views which looked
at things in aggregate - but people are
individuals, not aggregates. "On average, GDP
per person has gone up" doesn't do anything for
the person whose income has gone down. "Just
think about all the people in China who are so
much better off than they used to be" isn't going
to do much for an American or European whose
standard of living has slipped from middle class
to working class to government assistance.
"Redistribution" is routinely advertised as
the solution to all of this. I leave it as an
exercise to the reader to figure out how to
redistribute wealth from the areas that have
prospered the most (Asia, particularly China) to
the individuals (primarily in the West) who have
lost the most. In the absence of any viable
redistribution scheme, though, I suspect the most
likely outcome will be a pulling back on
globalization.
@
Terra_Desolata
The aggregates also do apply to countries -
i.e. the US on aggregate has benefited from
globalisation, but median wages have been
stagnant in real terms, meaning that the
benefits of globalisation have not been
well distributed across the country
(indeed, companies like Apple have
benefited hugely from reducing the costs of
production, while you could make the case
that much of the benefits of lower
production costs have been absorbed into
profit margins).
That suggests that redistribution can
occur at the country level, rather than
requiring a cross-border dimension.
@
Meh...
in the US, median male wages were
lower in 2014 than in 1973 - when a
far higher proportion of working-age
males were active in the labour
force.
Growing up in the 1970s, it would
have been unthinkable for wages to
have fallen since the 1930s.
Terra_Desolata
5pts
Featured
8 hours ago
@
Meh...
@
Terra_Desolata
Yes, there has been uneven
distribution of income within
countries as well as between them -
but as the Panama Papers revealed, in
a world of free movement of capital,
incomes can also move freely between
borders. (See: Apple.) While the
U.S. has lower tolerance than Europe
and Asia for such games, any attempts
at redistribution would necessarily
include an effort to keep incomes
from slipping across national
borders, which would have the same
effect: a net reduction in
globalization.
"... "In my lifetime I cannot remember anything like the scepticism about these values that we see today," said Suma Chakrabarti, president of the European Bank for Reconstruction and Development. ..."
"... There was much discussion this week about the underlying causes of that scepticism - low growth, stagnant wages and other scars of the 2008 global financial crisis - together with calls for governments to do more to ensure the benefits of globalisation are distributed more widely. ..."
"... Lou Jiwei, China's finance minister, told reporters on Friday, the current "political risks" would in the immediate future lead only to "superficial changes" for the global economy. But underlying them was a deeper trend of "deglobalisation". ..."
The world's economic elite spent this week invoking fears of protectionism and the
existential
crisis facing globalisation
.... ... ...
Mr Trump has raised the possibility of trying to renegotiate the terms of the US sovereign debt
much as he did repeatedly with his own business debts as a property developer. He also has proposed
imposing punitive tariffs on imports from China and Mexico and ripping up existing US trade pacts.
... ... ...
"Once a tariff has been imposed on a country's exports, it is in that country's best interest
to retaliate, and when it does, both countries end up worse off," IMF economists wrote.
It is not just angst over Mr Trump. There are similar concerns over Brexit and the rise of populist
parties elsewhere in Europe. All present their own threats to the advance of the US-led path of economic
liberalisation pursued since Keynes and his peers gathered at Bretton Woods in 1944.
"In my lifetime I cannot remember anything like the scepticism about these values that we
see today," said Suma Chakrabarti, president of the European Bank for Reconstruction and Development.
There was much discussion this week about the underlying causes of that scepticism - low growth,
stagnant wages and other scars of the 2008 global financial crisis - together with calls for governments
to do more to ensure the benefits of globalisation are distributed more widely.
Lou Jiwei, China's finance minister, told reporters on Friday, the current "political risks" would
in the immediate future lead only to "superficial changes" for the global economy. But underlying
them was a deeper trend of "deglobalisation".
"... Weak global trade, fears that the U.K. is marching towards a hard Brexit , and polls indicating that the U.S. election remains a tighter call than markets are pricing in have led a bevy of analysts to redouble their warnings that a backlash over globalization is poised to roil global financial markets-with profound consequences for the real economy and investment strategies. ..."
"... From the economists and politicians at the annual IMF meeting in Washington to strategists on Wall Street trying to advise clients, everyone seems to be pondering a future in which cooperation and global trade may look much different than they do now. ..."
"... "The main risk with potentially tough negotiating tactics is that trade partners could panic, especially if global coordination evaporates." ..."
Weak global trade, fears that the U.K. is marching towards a
hard Brexit , and polls indicating that the U.S. election remains a
tighter call than markets are
pricing in have led a bevy of analysts to redouble their warnings that a backlash over globalization
is poised to roil global financial markets-with profound consequences for the real economy and investment
strategies.
From the economists and politicians at the annual
IMF meeting in Washington to strategists on Wall Street trying to advise clients, everyone seems
to be pondering a future in which cooperation and
global trade may look much different than they do now.
Brexit
Suggestions that the U.K. will prioritize control over its migration policy at the expense of
open access to Europe's single market in negotiations to leave the European Union-a strategy that's
being dubbed a "hard Brexit"-loomed large over global markets. The U.K. government is "strongly supportive
of open markets, free markets, open economies, free trade," said
Chancellor of the Exchequer Philip Hammond during a Bloomberg Television interview in New York
on Thursday. "But we have a problem-and it's not just a British problem, it's a developed-world problem-in
keeping our populations engaged and supportive of our market capitalism, our economic model."
Trade
Citing the rising anti-trade sentiment, analysts from Bank of America Merrill Lynch warned that
"events show nations are becoming less willing to cooperate, more willing to contest," and a
backlash against inequality is likely to trigger more activist fiscal policies. Looser government
spending in developed countries-combined with trade protectionism and wealth redistribution-could
reshape global investment strategies, unleashing a wave of inflation, the bank argued, amid a looming
war against inequality.
U.S. Treasury Secretary Jack Lew did his part to push for more openness. During an interview in
Washington on Thursday, he said that efforts to boost trade, combined with a more equitable distribution
of the fruits of economic growth, are key to ensuring
U.S. prosperity. Rolling back on globalization would be counterproductive to any attempt to boost
median incomes, he added.
Trump
Without mentioning him by name, Lew's comments appeared to nod to Donald Trump, who some believe
could take the U.S. down a more isolationist trading path should he be elected president in November.
"The emergence of Donald Trump as a political force reflects a mood of growing discontent about immigration,
globalization and the distribution of wealth," write analysts at Fathom Consulting, a London-based
research firm. Their central scenario is that a Trump administration might be benign for the U.S.
economy. "However, in our downside scenario, Donald Dark, global trade falls sharply and a global
recession looms. In this world, isolationism wins, not just in the U.S., but globally," they caution.
Analysts at Standard Chartered Plc agree that the tail risks of a Trump presidency could be significant.
"The main risk with potentially tough negotiating tactics is that trade partners could panic, especially
if global coordination evaporates." They add that business confidence could take a big hit in this
context. "The global trade system could descend into a spiral of trade tariffs, reminiscent of what
happened after the
Smoot-Hawley tariff of 1930 , and ultimately a trade war, possibly accompanied by foreign-exchange
devaluations; this would be a 'lose-lose' deal for all."
Market participants are also concerned that populism could take root under a Hillary Clinton administration.
"We believe the liberal base's demands on a Clinton Administration could lead to an overly expansive
federal government with aggressive regulators," write analysts at Barclays Plc. "If the GOP does
not unify, Clinton may expand President Obama's use of executive authority to accomplish her goals."
"The top trade negotiators involved in the Trade in
Services Agreement (TiSA) will meet in Washington later
this month to review their latest market access offers and
prepare the groundwork for a final deal in December" [
Bloomberg
].
"The high-level meeting follows a successful September
negotiating round and recent signals from Washington that
a TiSA deal could be forged before the end of the year."
Yikes! Dark horse coming up on the outside!
"TTIP AG TALKS SET TO DRIFT: The U.S. summarily
rejected a European Union request for three days of
agriculture talks at this week's Transatlantic Trade and
Investment Partnership round, further indicating that
political uncertainty has limited what either side is able
to discuss in the negotiations, sources close to the talks
say" [
Politico
].
"'I think we can get there,' Lew said, referring to a
vote on the Asia-Pacific pact. He argued that voting for
TPP should be easier than voting for last year's Trade
Promotion Authority bill because it has tangible benefits
that will grow the economy. He said current voter angst is
not due to TPP itself but rather to other domestic needs
that the government has not adequately addressed" [
Politico
].
"'If we were investing more in infrastructure, which I
believe we should, if we were investing more
smartly
in education and training and in child care, I'm not so
sure we'd be in the same place,' Lew said." I think
"hysteresis" is the word for the fact that you can't
reverse a 40-year screw job handwaving about a policy
pivot. And whenever you hear a liberal use the word
"smart," get your back against the nearest wall.
"The American Brexit Is Coming" [James Stavridis,
Foreign Policy
]. "The case for the TPP is economically
strong, but the geopolitical logic is even more
compelling. The deal is one that China will have great
difficulty accepting, as it would put Beijing outside a
virtuous circle of allies, partners, and friends on both
sides of the Pacific. Frankly, that is a good place to
keep China from the perspective of the United States….
Over 2,500 years ago, during the Zhou dynasty, the
philosopher-warrior Sun Tzu wrote the compelling study of
conflict The Art of War. There is much wisdom in that slim
volume, including this quote: "The supreme art of war is
to subdue the enemy without fighting." The United States
can avoid conflict best in East Asia by using a robust
combination of national tools - with the TPP at the top of
the list. Looking across the Atlantic to the Brexit
debacle, we must avoid repeating the mistake in the
Pacific." And we get?
"12 U.S. Senators Outline TPP's Fundamental Flaws, Tell
President Obama it Shouldn't Be Considered Until
Renegotiated" (PDF) [
Public
Citizen
]. Brown, Sanders, Blumenthal, Merkley,
Franken, Markey, Schatz, Casey, Warren, Whitehouse, Hirono,
and Baldwin call for renegotiation. "It is simply not
accurate to call an agreement progressive if it does not
require trading partners to ban trade in goods made with
forced labor or includes a special court for corporations
to challenge legitimate, democratically developed public
policies."
"The way ahead" [Barack Obama,
The Economist
]. "Lifting productivity and wages also
depends on creating a global race to the top in rules for
trade. While some communities have suffered from foreign
competition, trade has helped our economy much more than
it has hurt. Exports helped lead us out of the recession.
American firms that export pay their workers up to 18%
more on average than companies that do not, according to a
report by my Council of Economic Advisers. So, I will keep
pushing for Congress to pass the Trans-Pacific Partnership
and to conclude a Transatlantic Trade and Investment
Partnership with the EU. These agreements, and stepped-up
trade enforcement, will level the playing field for
workers and businesses alike." I should really get out my
Magic Marker's for this one.
Steve C
October 7, 2016 at 4:45 pm
"Global race to the top" is vintage Obama propaganda. A "smart" sounding
phrase meant to obscure the impact of TPP on the non-elite. The adoring
comments make it all the worse. He sure knows the lingo to appeal to educated
professionals.
This is a lot of patented, soaring Obama verbiage that boils down to
surrendering to global corporations and the big banks.
Yeah, no one is thinking through the analogy to note that there are very
few races where everyone wins. In point of fact, except for those where
finishing is considered an accomplishment like marathons, there is only one
winner and what's left are also ran and losers. So why are we involved in a
situation where most are going to lose?
"Morning Trade was let down - along with many on Twitter - that there was no mention of the TPP [in
the Vice-Presidential Debate], a deal that both vice presidential candidates initially supported until
they signed on as running-mates and flip-flopped" [
Politico
].
Especially given that in Trump's strong first half-hour, he hammered Clinton with it.
"In conference at Yale Law School, DeLauro pushes to stop controversial Trans Pacific Partnership"
[
New
Haven Register
]. Detailed report of speech. ".S. Rep. Rosa DeLauro, D-3, said the administration
will be "relentless" in its pursuit of a positive vote on the Trans Pacific Partnership in the lame
duck Congress, something she and a coalition in Congress are hoping to stop…. '(T)he agreement is undemocratic
in its drafting, undemocratic in its contents and it cannot be passed during an unaccountable lame duck
period,' she told Yale Law students and staff in attendance."
"Obama Hails Enforcement on Trade Deals to Win Support for T.P.P." [
New
York Times
]. "Such actions against other countries' subsidies, dumping and market barriers, however,
do not address two big concerns of trade skeptics: currency manipulation and workers' rights."
"The French decision follows Uruguay and Paraguay leaving the controversial US backed TISA negotiations
last year and the recent humiliating back down of the EU on Investor State Dispute Resolution. With
Germany and France so critical and Great Britain on the way out of the EU, it is hard to see how the
European Commission can continue the negotiations" [
Public
Services International
].
Now the predatory class claims to be aghast at what its
policies have enabled--Trump. But are Trumps policies really
the problem...or is the problem that doesn't use the
reassuring, coded language that the predatory class has
carefully crafted to cover its exploitation?
"... Average US wages rose 350% in the 40 years between 1932 and 1972, but only 22% over the next 40 years. The pattern holds similar across the developed world. In other words, for all their hype, the computer and the internet have done less to lift economic growth than the flush toilet. ..."
"... ahem… the computer and the internet sped outsourcing to countries like China. Ask China or India how their economic growth has been since 1972. The author is mixing up several things at once. ..."
"... When so many of our jobs, technology and investment is offshored to China (and elsewhere), the future for innovation is certainly not bright, and this should be obvious to everyone, including the author. ..."
" Average US wages rose 350% in the 40 years between 1932 and 1972, but only 22% over the next
40 years. The pattern holds similar across the developed world. In other words, for all their hype,
the computer and the internet have done less to lift economic growth than the flush toilet."
ahem… the computer and the internet sped outsourcing to countries like China. Ask China or India
how their economic growth has been since 1972. The author is mixing up several things at once.
Great comments, and please allow me to piggyback off them:
When so many of our jobs, technology and investment is offshored to China (and elsewhere), the
future for innovation is certainly not bright, and this should be obvious to everyone, including
the author.
When so many have contributed so much, only to see their jobs and livelihoods offshored again
and again and again, that great jump the others have will then zero out OUR innovation!
"... free-market ideology seems - to many Americans, and also incidentally to me - to have mostly hit a wall in terms of its ability to improve our lives, and so society will inevitably embrace an alternative, despite the protests of diehard free-marketers. ..."
"... I always think of free enterprise as being like fire. Fire is amazingly useful and powerful. It can do things that nothing else can, but you don't burn down your house to read after dark or burn yourself alive to cook dinner. ..."
"... Neoliberal economics seems to me at least, to be promoted for its political implications. Rather its a justification to keep power in the hands or peoples who currently have it. ..."
"... A very important place to look for the failure of free market ideology is where it doesn't even show up. Social security, WIC, and rural education in some areas are good examples. ..."
"... I dont know if Noah had this specifically in mind or not but a point I would make especially about the examples he chose would be that there is no other way to privatize the prisons. Privatization helps when the incentives for profit can actually help drive innovations or improve productivity. In the case of prisons that isn't possible. ..."
"... Privatizing prisons was one of the worst ideas in human history. Allowing some private investors to profit off misery is about as sick as can be. there have been no innovations to come form this experiment. All that happens is an income stream gets diverted, cuts are made to services and workforce to trim "fat" and then someone gets the bright idea that people who have committed a crime and are "paying" with their lack of freedom (supposedly the highest goal of theses Faux conservatives) should also start paying monetarily for things. People actually have to start paying for their own bondage. ..."
"... "Twenty years ago President Clinton signed the Personal Responsibility and Work Opportunity Reconciliation Act. The ending of legal entitlement to welfare has had a dramatic effect on low-income children. Welfare rolls fell rapidly and never recovered even as child poverty roared back in the wake of the Great Recession. Only 26 percent of potentially eligible families received aid by 2013, compared to 68 percent in 1996 when the the law was passed." ..."
"... I predict a coming split on the left between the reality-based, populist left and the more political, careerist center-left. And not just in the U.S. ..."
"... Private property, the bedrock of the "free market" system doesn't just happen. It requires the buy in of the entire society (or an extreme police state I suppose. Unfortunately I don't think that bothers a lot of the free market uber alles people). ..."
"... There is a simple way of making sure that our Hybrid health system costs as much as the European counterparts: mandate that no pharmaceutical or medical devices company can price discriminate. You can only sell here if you sell at the same prices across the world. The prices will drop very quickly. We will stop subsidizing the world for a change. ..."
"... The Free Marketeers just want to return us to a time when life was nasty, brutish and short. ..."
"... Free market failures are usually based on some company that has figured out a way to pass some of their costs on to society. The costs might be poverty, pollution, or excess risk, but in each case, the government is left to impose Pigovian Taxes in the form of regulation (or occasionally in the form of taxes). ..."
"... The term "free-market" clearly needs some fine-tuning. In Singapore, employers are required to comply with health and safety regulations, industrial relations guidance, and a variety of good employment practices and guidelines. ..."
"... So what gives? Easy. Instead of concentrating on bumper-stickers like "free trade", Singapore concentrated on education, and on weeding out corruption. As a result, Singapore has almost none of the problems mentioned in the article. ..."
I recently wrote
a Bloomberg View post about political-economic ideologies, and how society is quicker to change
than individual human beings. The upshot was that free-market ideology seems - to many Americans,
and also incidentally to me - to have mostly hit a wall in terms of its ability to improve our lives,
and so society will inevitably embrace an alternative, despite the protests of diehard free-marketers.
Bryan
Caplan is flabbergasted at the notion that free-market ideology (aka "neoliberalism") has actually
been tried in the U.S.:
The claim that "free-market dogma" is the "reigning economic policy" of the United States or any
major country seems so absurd, so contrary to big blatant facts (like government spending as a
share of GDP, for starters), that I'm dumb-founded.
This is pretty much exactly the attitude I described in my post! "Of course neoliberalism hasn't
failed; we just never really tried it."
David Henderson has
a longer
and more measured response . He challenges the idea that free-market ideology has demonstrated
any failures at all.
Now I could simply make a weak claim - i.e., that free-market ideology seems to have hit
a wall, and that in the end, that general perception is much more important than what I personally
think. But instead, I'll make the much stronger claim - I'll defend the idea that free-market ideology
has, in fact, really hit a wall in terms of its effectiveness.
Exhibit A: Tax cuts. Tax cuts, one of free-marketers' flagship policies, appear
to have given our economy a boost in the 1960s, and a smaller boost in the 1980s. But any economic
boost from the Bush tax cuts of 2001 and 2003 was so small as to be invisible to all but (possibly)
the most careful econometricians. Notably, a number of attempts to encourage savings - capital
gains tax cuts, estate tax cuts, and the like - have not halted the steady decline in personal
savings rates.
Exhibit B: Financial deregulation and light-touch regulation. It seems
clear to me that under-regulation of derivatives markets and mortgage lending played a big role
in the financial crisis. The counter-narrative, that government intervention caused the crisis,
has never held much water, and has been debunked by many papers. This was a private-sector blowup.
Exhibit C: Light-touch regulation of monopoly. The evidence is mounting
that industrial concentration is an increasing problem for the U.S. economy. Some of this might
be due to intellectual property, but much is simply due to naturally increasing returns to scale.
Exhibit D: The China shock. While most trade booms seem to lead to widely
shared gains, the China trade boom in the 2000s - which free marketers consistently championed
and hailed - probably did not. High transaction costs (retraining costs, moving costs, and others)
lead to a very large number of American workers being deeply and permanently hurt by the shock,
as evidenced by recent work by Autor, Dorn, and Hanson.
Exhibit E: Faux-privatization. True privatization is when the government halts
a nationalized industry and auctions off its assets. Faux-privatization is when the government
outsources an activity to contractors, often without even competitive bidding. Faux-privatization
has been a notable bust in the prison industry, and school voucher programs have also been extremely
underwhelming. Charter schools have fared a bit better, but even there the gains have been modest
at best.
Exhibit F: Welfare reform. Clinton's welfare reform saved the taxpayer
very little money, and appears to have had little if any effect on poverty in the U.S.
Exhibit G: Research funding cuts. The impact of these is hard to measure,
but cuts in government funding of research appear to have saved the taxpayer very little money,
while dramatically increasing the time that scientists have to devote to writing grant proposals,
and increasing risk aversion in scientists' choice of research topics.
Exhibit H: Health care. The U.S. health care system is a hybrid private-public
system, but includes a proportionally much larger private component than any other developed nation's
system. Free-marketers have fought doggedly to prevent the government from playing a larger role.
Our hybrid system delivers basically the same results as every other developed country's system,
at about twice the cost. Private health care cost growth has been much faster than cost growth
for Medicare and other government-provided programs, indicating that much of our excess cost has
been due to the private component of our system, not the public part.
I could go on, but these are the big ones I can think of. In some of these cases, free-market
policies seem to have produced some gains in the late 20th century, but by the 21st century all appeared
to be either having no effect, or actively harming the economy.
No, this is nowhere near as big a failure as that of communism (though in some ways, notably health
care and financial deregulation, we've done worse than the somewhat-socialist nations of Europe).
The analogy with communism was a way of illustrating a certain mindset, not to draw an equivalence
between the results of neoliberalism and communism.
Also, I personally think there is still scope for many neoliberal policies to improve our economy.
Reduced occupational licensing, urban land-use deregulation, simplification of the tax code, and
various other kinds of deregulation all seem to show promise. If free-market policies have hit a
wall, it's a porous wall - in real life, nothing is as cut-and-dry as in our ideological debates.
But overall, I think the last decade and a half have shown clearly diminishing returns, and sometimes
negative returns, from neoliberal reforms. So our society is right to be looking for alternative
policy packages. Though that doesn't necessarily mean we'll choose a good alternative - I
think Sanders-style socialism would probably be a mistake.
I always think of free enterprise as being like fire. Fire is amazingly useful and powerful.
It can do things that nothing else can, but you don't burn down your house to read after dark
or burn yourself alive to cook dinner.
Neoliberal economics seems to me at least, to be promoted for its political implications.
Rather its a justification to keep power in the hands or peoples who currently have it.
"Tax cuts, one of free-marketers' flagship policies, appear to have given our economy a boost
in the 1960s, and a smaller boost in the 1980s. But any economic boost from the Bush tax cuts
of 2001 and 2003 was so small as to be invisible to all but (possibly) the most careful econometricians."
Why would this be surprising to a neo-liberal/free marketer? The Kennedy and Reagan cuts both
reduced the top marginal income tax rate by 20 percentage points. The Bush cuts lowered the it
by 4.6 points and the top corporate rate was unchanged. It's also strange that you would lump
the 2001 and 2003 cuts together in this context. During the four years after the '03 rate cut
, GDP growth averaged a little over 3% annually. Perhaps that's not spectacular, but it's considerably
higher than anything we've seen during the current expansion, no?
Also like some other commenters, I don't understand your point on "faux privatization."
A very important place to look for the failure of free market ideology is where it doesn't
even show up. Social security, WIC, and rural education in some areas are good examples.
Also anything environmental, including global climate change as above (pro tip: Coase applies
to low transaction cost scenarios). Barry Bozeman of science policy econ fame has a schema of
public success/public failure/private success/private failure. (Tobacco regulation in the 1970s
is an example of public failure, for instance.) But even that doesn't capture the failure of a
no-show like elder poverty before social security: a non-diversifiable, irreversible, and widely
experienced risk of being old and poor, possibly as a result of a bad sector/geography/business
cycle/ genetics draw.
I dont know if Noah had this specifically in mind or not but a point I would make especially
about the examples he chose would be that there is no other way to privatize the prisons. Privatization
helps when the incentives for profit can actually help drive innovations or improve productivity.
In the case of prisons that isn't possible.
Privatization has simply meant taking an income stream from the govt and guaranteeing it to
some private contractor. You cant get the incentives to line up in prisons. The goal of society
is to keep people out of prison, we think it is a success (I would hope) if no one goes to jail
this month. That means no one has done anything jail worthy. But private prison systems need customers
so they will push for guaranteed quotas, which only the state can send them because only the state
gets to adjudicate what is a crime and what the punishment will be, not private parties.
Privatizing prisons was one of the worst ideas in human history. Allowing some private
investors to profit off misery is about as sick as can be. there have been no innovations to come
form this experiment. All that happens is an income stream gets diverted, cuts are made to services
and workforce to trim "fat" and then someone gets the bright idea that people who have committed
a crime and are "paying" with their lack of freedom (supposedly the highest goal of theses Faux
conservatives) should also start paying monetarily for things. People actually have to start paying
for their own bondage.
The school privatizations aren't nearly as grotesque as the prisons but they also get
the incentives badly skewed and should be scaled back.
I think your arguments are ridiculous. Profit can be achieved through efficiencies and expense
reductions too. And just because the private prison operators can "push for guaranteed quotas"
doesn't mean the customers (government) has to provide them.
Expense reductions....hah! Pay cuts to the workers and cheaper services (fewer meals etc) to
the inmates. There is nothing that private prisons can do BETTER than the public ones..... and
they have to pay stockholders.
Again... its sick to have a for profit prison system. Profit off of punishment!! Lets get more
punishment!!
Regulation is too broad a brush to paint with. Instead of writing about it monolithically,
you really have to dive into specifics. Some are helpful, many are not. I'm guessing absent some
regulation, we'd see very small improvements in the economy, but certainly that's still worthwhile
goal, no?
"Exhibit F: Welfare reform. Clinton's welfare reform saved the taxpayer very little money,
and appears to have had little if any effect on poverty in the U.S."
"Twenty years ago President Clinton signed the Personal Responsibility and Work Opportunity
Reconciliation Act. The ending of legal entitlement to welfare has had a dramatic effect on low-income
children. Welfare rolls fell rapidly and never recovered even as child poverty roared back in
the wake of the Great Recession. Only 26 percent of potentially eligible families received aid
by 2013, compared to 68 percent in 1996 when the the law was passed."
Little effect on poverty? The neoliberal "center-left" has become corrupt. You just can't make
up your own facts and own history just b/c suits Hillary Clinton. That's what the Republicans
have done for decades and it hasn't served them very well.
I predict a coming split on the left between the reality-based, populist left and the more
political, careerist center-left. And not just in the U.S.
I think this whole discussion is so blinkered because it doesn't consider the political elements
of political economy.
Private property, the bedrock of the "free market" system doesn't just happen. It requires
the buy in of the entire society (or an extreme police state I suppose. Unfortunately I don't
think that bothers a lot of the free market uber alles people).
Why would people who don't benefit from a society agree to its rules? I see a lot of people
here bemoaning the spending, etc. But the spending is some of what ameliorates the problems for
the losers of the capitalist system. Because there has to be losers, that's capitalism.
I suppose there could be market based distribution like basic income. But there we are always
going to have taxes and distribution because otherwise there are the guillotines.
Regarding regulations, they are also necessary to retain support for the system. One way is
it gives people a way to direct a counterbalance to the power of the big winners. Extreme deregulation
removes the ability for most people to have a say in the direction of their society. One dollar
one vote isn't the same as one person one vote. If government isn't allowed a say in the direction
of the economy then most people loose the ability to have their say in the direction of the economy.
There is a simple way of making sure that our Hybrid health system costs as much as the
European counterparts: mandate that no pharmaceutical or medical devices company can price discriminate.
You can only sell here if you sell at the same prices across the world. The prices will drop very
quickly. We will stop subsidizing the world for a change.
Free market advocated love to cite the rapid growth of the US before WW II when the US was
very close to a free market economy with very small government. But this more rapid growth was
essentially all due to more rapid population growth. From 1850 to 1960 the trend growth rate of
per capita real GDP was 0.14%. Since 1950 it has been 0.21%, or approximately double the earlier
trend when we did not have large government. Bu 1850 most of the essential elements of free market
capitalism eaw in place-- fractional ownership of firms, large and efficient stock and bond markets,
modern double entry bookkeeping, etc.--were in place. By making 1950 the end point the rapid growth
of the 1940s had offset the negative impact of the depression so it is not a bias comparison.
Both free market ideology and communist ideology are 19th century doctrines. Marxists are stuck
in a time loop dating from the 1840s to the 1860s when everyone was still debating whether slavery
was a good idea. Free Marketeers, similarly, have their clock stuck in the 1890s when Alfred Marshall
wrote his Principles of Economics. Of course, the Free Marketeers were big supporters of child
labor, and opponents of women's suffrage, workers compensation, and all forms of social insurance.
Isn't it about time for economists to move out of the 19th century and into the 21st century?
Both economic and social conditions are dramatically different now than 150 years ago. I, for
one, can't see why anyone would want to return to the 19th century! It was a ghastly period in
our history, finally culminating in the First World War. The Free Marketeers just want to
return us to a time when life was nasty, brutish and short.
Instead, we should realize the primary problem in economics has been solved. We are living
in a post scarcity society. When the biggest decisions we face are whether to get a 4tb harddrive
rather than a 2tb harddrive, or a 60 inch television rather than a 55 inch television, it can
safely be said that scarcity is no longer a problem.
Which leads to my questions -- If there is enough food for everyone, why should anyone starve?
If we are bulldozing houses because we overbuilt, why should anyone be homeless? If we have enough
doctors, hospitals and drugs, why should anyone remain untreated?
It strikes me that our society has imposed artificial restrictions that serve no purpose other
than to create the most misery for the greatest number of people.
Free market failures are usually based on some company that has figured out a way to pass
some of their costs on to society. The costs might be poverty, pollution, or excess risk, but
in each case, the government is left to impose Pigovian Taxes in the form of regulation (or occasionally
in the form of taxes).
The example of government-funded research is simply the same process in reverse (public benefits
instead of public costs.)
America has a free market, if you compare it to, for example, North Korea. But our freedom
pales in comparison to, say, Bangladesh (where the government can't even enforce basic property
rights, much less environmental regulations).
The term "free-market" clearly needs some fine-tuning. In Singapore, employers are required
to comply with health and safety regulations, industrial relations guidance, and a variety of
good employment practices and guidelines.
If you read the laws and guidelines (not to mention the price controls and state-linked
enterprises), you would assume that this was some Communist dystopia, yet Singapore is considered
the most pro-business country on Earth (by a wide margin).
So what gives? Easy. Instead of concentrating on bumper-stickers like "free trade", Singapore
concentrated on education, and on weeding out corruption. As a result, Singapore has almost none
of the problems mentioned in the article.
"... By Alejandro Reuss, a historian, economist, and co-editor of Triple Crisis blog and ..."
"... magazine. Originally published at Triple Crisis ..."
"... This is the first part of a three-part series on the historical trajectory of European social democracy towards the so-called "Third Way"-a turn away from class-struggle politics and a compromise with neoliberal capitalism-and its role in the shaping of the Economic and Monetary Union of the EU. It is a continuation of his earlier series "The Eurozone Crisis: Monetary Union and Fiscal Disunion" ( Part 1 and Part 2 ). His related article "An Historical Perspective on Brexit: Capitalist Internationalism, Reactionary Nationalism, and Socialist Internationalism" is available here . ..."
"... All of these governments were led by figures who had turned away from the traditional social-democratic politics of class struggle (in even the moderated form prevalent in the postwar period), while still promising to temper neoliberal capitalism. This approach became known as the "Third Way," a term especially associated with the "New Labour" program of Blair in the U.K., but also used to describe similar shifts in other countries. As Swedish political scientist Peo Hansen puts it, Blair expressed "unconditional espousal of capitalist globalization and … further liberalization of labour markets." ..."
"... "Wage dumping, tax dumping and welfare dumping," Lafontaine declared, "are not our [social democrats'] response to the globalization of markets!" That was too much for Schroeder and other social democratic leaders in Europe, and Lafontaine resigned under pressure in 1999. ..."
"... The Third way movements, so called, used the language of reform, the language of toned-down class struggle to gain power but have never worked toward any of the goals implicit in that language. The opposite is true. Politicians like The Clintons, and Obama in the US, and Blair in the UK, have worked steadily to erode the gains made by workers struggles in the 20th century, and have done far more to that end than any right wing ideologue could have. . There have a been a few bitter lesson for the working class in it 1. Like it or not, there is a class struggle 2. class struggle doesn't end when you gain a few concessions 3. You cant hire opportunistic politicians to carry on that struggle for you by voting for them once every few years. ..."
"... legitimation crisis of capital from the standpoint of capitalists themselves, ..."
"... "The Labour and time of the poor is in civilised countries sacrificed to the maintaining of the rich in ease and luxury. The Landlord is maintained in idleness and luxury by the labour of his tenants. The moneyed man is supported by his extractions from the industrious merchant and the needy who are obliged to support him in ease by a return for the use of his money. But every savage has the full fruits of his own labours; there are no landlords, no usurers and no tax gatherers." ..."
"... "But the rate of profit does not, like rent and wages, rise with the prosperity and fall with the declension of the society. On the contrary, it is naturally low in rich and high in poor countries, and it is always highest in the countries which are going fastest to ruin." ..."
Posted on
September 30, 2016
by
Yves Smith
By Alejandro Reuss, a historian, economist, and co-editor of Triple
Crisis blog and
Dollars & Sense
magazine. Originally published at
Triple Crisis
This is the first part of a three-part series on the historical
trajectory of European social democracy towards the so-called "Third Way"-a turn away from class-struggle
politics and a compromise with neoliberal capitalism-and its role in the shaping of the Economic
and Monetary Union of the EU. It is a continuation of his earlier series "The Eurozone Crisis: Monetary
Union and Fiscal Disunion" (
Part
1
and
Part 2
). His related article "An Historical Perspective on Brexit: Capitalist Internationalism,
Reactionary Nationalism, and Socialist Internationalism" is available
here
.
The idea of a united Europe was not unique to neoliberal politicians or financial capitalists,
even if their vision was the one that ended up winning out. Rather, this idea cut across the entire
political spectrum, from forces clearly associated with giant capitalist corporations and high finance
to those associated with the working-class movement. Just as there have been "anti-Europe" or "euroskeptic"
forces on the political left and right, there were also diverse forces in favor of European unification,
each with its own vision of what a united Europe could be.
Going back to the mid-20th century, leaders of the social democratic, reformist left envisioned
a future "Social Europe." The European Social Charter, adopted by the Council of Europe in 1961,
promulgated a broad vision of "social and economic rights," including objectives like full employment,
reduction of work hours, protection of workers' rights to organize and bargain collectively, rights
to social security and medical assistance, protection of the rights of migrants, and so on.
Figures on the revolutionary left, like the Belgian Marxist economist and Trotskyist leader Ernest
Mandel, advocated a "United Socialist States of Europe." This was an expression not only of revolutionary
internationalism, but also of Mandel's view that the working class could no longer confront increasingly
internationalized capital through political action confined to the national level.
In other words, the question was not just whether Europe would become united, but (if it did)
what form such unification would take.
Triumph of the "Modernizers"
The vision of social democracy on a grand scale did not come to pass, nor even was there significant
movement in that direction when social democratic parties led the governments of the largest and
most powerful countries in the EU. During overlapping periods in the late 1990s, the Labour Party's
Tony Blair was prime minister in the U.K., the Socialist Lionel Jospin was prime minister in France
(though in "cohabitation" with Conservative president Jacques Chriac), the L'Ulivo (Olive Tree) coalition's
Romano Prodi led the government in Italy, and the Social Democrat Gerhard Schroeder (leading the
so-called "Red-Green" coalition, with the Green Party as junior partner) was the chancellor of Germany.
All of these governments were led by figures who had turned away from the traditional social-democratic
politics of class struggle (in even the moderated form prevalent in the postwar period), while still
promising to temper neoliberal capitalism. This approach became known as the "Third Way," a term
especially associated with the "New Labour" program of Blair in the U.K., but also used to describe
similar shifts in other countries. As Swedish political scientist Peo Hansen puts it, Blair expressed
"unconditional espousal of capitalist globalization and … further liberalization of labour markets."
Jospin, who campaigned as a critic of neoliberalism, quickly shifted to "multiple privatization schemes
and policy reshufflings favourable to business." Prodi was "firmly in the camp of the 'modernisers'."
The case of Germany is especially instructive: The finance minister in the Social Democratic-Green
coalition government, Oskar Lafontaine, was notable for swimming against the neoliberal tide-criticizing
the EU's fiscal constraints and inflation-targeting monetary policy, and proposing the adoption of
common tax and social welfare policies. That is, he was arguing for EU-wide social democratic reforms
to end "race to the bottom" dynamics (on wages, taxes, etc.) emerging in the EU.
"Wage dumping, tax
dumping and welfare dumping," Lafontaine declared, "are not our [social democrats'] response to the
globalization of markets!" That was too much for Schroeder and other social democratic leaders in
Europe, and Lafontaine resigned under pressure in 1999.
Lafontaine would later become a founder and leader of Die Linke (The Left), which is certainly
to the left of the Social Democrats. He was not, however, a revolutionary who threatened to upset
the reformist apple cart. Rather, argues Hansen, Lafontaine was a "political liability among his
own for merely sticking with a set of very traditional social democratic policies and values."
The Third way movements, so called, used the language of reform, the language
of toned-down class struggle to gain power but have never worked toward any of
the goals implicit in that language. The opposite is true. Politicians like The
Clintons, and Obama in the US, and Blair in the UK, have worked steadily to erode
the gains made by workers struggles in the 20th century, and have done far more
to that end than any right wing ideologue could have. . There have a been a few
bitter lesson for the working class in it 1. Like it or not, there is a class struggle
2. class struggle doesn't end when you gain a few concessions 3. You cant hire
opportunistic politicians to carry on that struggle for you by voting for them
once every few years.
I'll once again jump in, hands waving, to recommend Wolfgang Streeck's "Buying
Time" and Peter Mair's "Ruling the Void" to anyone who wants a more developed take
on this subject. Streeck is particularly good on how Marxist theorists missed the
boat on the possibility of a
legitimation crisis of capital from the standpoint
of capitalists themselves,
as opposed to the standpoint of the working and
- I'll cautiously add - professional-managerial classes.
There's also a useful periodization of the changes in sources of state funding, accompanied by consideration
of the politics accompanying those changes. Mair is great on how "catch-all" parties
developed out of the more class struggle-oriented parties the article refers to.
(It's a real shame Mair died relatively young.).
@hemeantwell – And I'll add Bill Mitchell's recently published book "Eurozone
Dystopia – Groupthink and Denial on a Grand Scale". It traces the development
of the Eurozone from the early Franco-German rivalry going back to the 1940's.
Of course it emphasizes the economic mistakes in the creation of the Eurozone,
but also has a deep dive into the political issues and errors that led to those
mistakes.
"This, of course, has always been a fundamental contradiction when left-social democratic parties
have swept to power: the political consciousness of its working class base demands a direct attack
on the inequities and injustices of capitalism but not to the extent of overthrowing capitalism
itself. Social democracy is thus philosophically idealist about fundamentally altering the dynamics
of capitalism while ignoring that those reforms will never change capitalism's core dynamic of
class rule and exploitation, but it will cloak this under the rubric of pragmatism and the endless
possibility of voting in a bourgeois electoral system. In an era of expanding worldwide demand
and growth of industry in the core, the social democratic system of working class empowerment
could be tolerated as it tamed the wilder impulses of the working class while creating the consumers
now lauded as the "middle class" of 20th century capitalism's 30-year golden age in the post-WWII
era. Social democracy never won the working class political control, but the power wielded by
socialist parties allowed segments of the working class access an increasing share of capital's
immense accumulation in the post-war era.
Syriza has arrived on the scene decades after the last meaningful acts of social-democracy
could occur. Capitalism in the core has long since ceased to need to make deals with socialist
parties as representatives of an industrial proletariat; those jobs have been replaced by shifting
industrial work to the periphery as the capitalist world-system tends to do specifically as acounter
to the success of mid-century social-democracy, or by increasing mechanization in the core – again,
a tendency within capitalism well described by Marx. Straitjacketed by a capitalism that no longer
needs to tame a restless proletariat into a large consumer class, Syriza faces immense pressure
from "the institutions" to allow continued profiteering from privatization and bond repayment
– the very things that constitute super-profit in the financial era of this end of capitalism's
long-cycle. Add to this the European Union's structure itself, which was built to constrain any
national attempts at left-reformism, and Syriza's determination not to even bluff about a Grexit
– which might provide a modicum of control over at least the nation's currency and deficit spending
– and there is little room for a party like Syriza to deliver on its promises."
Neo-Liberalism is dying a natural death. It was all about the private sector and the successful pure capitalist model.
Have you heard a policy maker expect the private sector to do much in the last eight years
since 2008?
No, it's all been about national institutions.
Central Banks for monetary policy and Governments for fiscal policy.
The private sector is interested in easy profits and not the potential losses when the going get
tough.
The IMF and others now realise there is a problem with global aggregate demand (due to inequality).
The current suggestions are helicopter money, fiscal stimulus and redistribution through taxation.
Pure capitalism polarises personal wealth, destroying demand.
This week in the FT, Larry Summers was talking about the problems of the disappearing middle
class in the US (the polarisation of personal wealth).
Middle class consumption made a significant contribution to GDP and as it disappears GDP is affected.
Neo-Liberalism destroys itself. The expansion of globalisation is complete. The maintenance of consumption with debt has reached the end of the road.
The polarisation of personal wealth has impoverished the global consumer and is killing demand.
There is too much money at the top leading to negative yield on many investments.
With such subdued demand there is little to invest in.
Supply never did create its own demand – someone just made it up.
Central bankers have to throw in trillions to keep this failing system in the permanent stagnation
of the "New Normal".
What should come next: Collectivization. Workers uniting to form their own worker-owned
enterprises. Imagine an employee-owned Uber etc. Its the only way out for the masses.
To make automation work for us, end exclusion & stop this race to the bottom.
Neo-liberal capitalism is in crisis and no one seems to know how to move on
from today's "Secular Stagnation". Capitalism is in crisis for a very good reason.
Today's ideal is small state, raw capitalism, which is actually how capitalism started, and
we chose to ignore the work of the Classical Economists that studied it first hand in the past.
They realised capitalism has two sides the productive side, where "earned" income is generated
and the unproductive, parasitic, rentier side where "unearned" income is generated.
Today's neoclassical economics is missing this distinction and everyone is going for the easy
money in the unproductive side of capitalism.
The UK now dreams of giving up work and living off the "unearned" income from a BTL portfolio,
extracting the "earned" income of generation rent.
The UK dream is to be like the idle rich, rentier, living off "unearned" income and doing nothing
productive.
Adam Smith:
"The Labour and time of the poor is in civilised countries sacrificed to the maintaining
of the rich in ease and luxury. The Landlord is maintained in idleness and luxury by the labour
of his tenants. The moneyed man is supported by his extractions from the industrious merchant
and the needy who are obliged to support him in ease by a return for the use of his money. But
every savage has the full fruits of his own labours; there are no landlords, no usurers and no
tax gatherers."
Capitalism incorporates a welfare state for the idle rich and we can see our Aristocracy living
in luxury and leisure off the "unearned increment" today.
In our ignorance of the reality of small state, raw capitalism, we have been busy promoting
the unproductive side of capitalism to the masses by encouraging the BTL investor.
When you encourage too many people into the unproductive side of capitalism they are going
to bleed it dry.
Adam Smith would think we are on the road to ruin:
"But the rate of profit does not, like rent and wages, rise with the prosperity and fall
with the declension of the society. On the contrary, it is naturally low in rich and high in poor
countries, and it is always highest in the countries which are going fastest to ruin."
Exactly the opposite of today's thinking, what does he mean?
When rates of profit are high, capitalism is cannibalising itself by:
1) Not engaging in long term investment for the future
2) Paying insufficient wages to maintain demand for its products and services
In the 18th Century they would have understood today's problems with growth and demand.
Having forgotten the work of the Classical Economists, we set today's goal as maximising profit
which actually undermines and eventually destroys capitalism itself.
Amazon didn't pay out profits as dividends and re-invested them, look how big it's grown.
Just imagine if all companies were doing that.
We have undermined, and are destroying capitalism itself, because we didn't understand it.
Small state, raw capitalism existed before and we should have taken on board the lessons the
economists learnt at the time when they studied it.
The Classical Economists always expected the bankers to get behind the productive
side of capitalism. Everyone has now forgotten the two sides of capitalism and about 80% of lending goes into
real estate, inflating the cost of living with high mortgage payments and rent.
This in turn raises the cost of living and the minimum wage, making Western labour uncompetitive
in international markets. It also reduces the purchasing power within the economy, reducing
demand for products and services.
All known and seen over two hundred years ago in the first round of small state, raw capitalism.
(In those days it was just high rents, but the effect is the same).
Thank you for your posts. They are greatly appreciated. It
reminds me 2011 discussions about political sustainability of
neoliberalism in Crooked Timber (cited via Economist):
http://www.economist.com/blogs/democracyinamerica/2011/07/neoliberalism
== quote ==
OVER at the Crooked Timber blog, Henry Farrell comments on Doug
Henwood's response to Matthew Yglesias' argument for a higher,
employment-boosting inflation target, which I endorsed in my
last post. Mr Henwood dislikes Mr Yglesias' apparent
"neoliberal" preference for monetary over fiscal remedies to
high unemployment. He writes:
From an elite point of view, the primary problem with a
jobs program-and with employment-boosting infrastructure
projects-is that they would put a floor under employment,
making workers more confident and less likely to do what the
boss says, and less dependent on private employers for a
paycheck. It would increase the power of labor relative to
capital.
I think we're supposed to understand "elite" as roughly
synonymous with "neoliberal" here. "Neoliberalism" has become
something of a term of abuse on the left, though its denotation
remains vague. It is something of which Mr Yglesias and I,
despite our considerable ideological differences, are regularly
accused. This newspaper is even denounced from time to time as a
neoliberal rag. Anyway, as a sort of neoliberal (a neoclassical
liberal), let me say that from my point of view the problem with
jobs programmes, as compared to textbook monetary policy, is not
that they increase the power of labour relative to capital. It's
that they do little to sustainably increase demand for labour.
And nothing reduces the power of labour relative to capital more
than low demand for labour. But I digress.
Mr Farrell notes that Mr Yglesias is a better leftist than Mr
Henwood gives him credit for, but thinks Mr Henwood is "on to
something significant" in his complaints about Yglesian
left-leaning neoliberalism.
Neo-liberals tend to favor a combination of market mechanisms
and technocratic solutions to solve social problems. But these
kinds of solutions tend to discount politics – and in particular
political collective action, which requires strong collective
actors such as trade unions. This means that vaguely-leftish
versions of neo-liberalism often have weak theories of politics,
and in particular of the politics of collective action. I see
Doug and others as arguing that successful political change
requires large scale organized collective action, and that this
in turn requires the correction of major power imbalances (e.g.
between labor and capital).
They're also arguing that neo-liberal policies at best tend
not to help correct these imbalances, and they seem to me to
have a pretty good case. Even if left-leaning neo-liberals are
right to claim that technocratic solutions and market mechanisms
can work to relieve disparities etc, it's hard for me to see how
left-leaning neo-liberalism can generate any self-sustaining
politics.
The implied premise here seems to be that labour-union social
democracy is an ideology that generates self-sustaining
politics. But Mr Yglesias pops up in the comments to say:
[T]he self-assurance that there's some non-neoliberal
miracle formula for political sustainability seems refuted by
the fact that the pre-neoliberal paradigm in the United
States was not, in fact, politically sustainable.
== end of quote ==
My impression that neoliberalism can continue to exist in the
current zombie state (when ideology is completely discredited,
but power of multinationals is still in full swing and there are
no viable alternatives other then returning to a modernized
variant of the New Deal) until the real "peak/plato oil" crisis
hits the civilization. That might be several decades away.
Communism as an ideology was dead probably soon after WWII
but managed to survive in zombie state for another 40 years.
Trump and, especially, Sanders both signal that the backlash
against neoliberal globalization is mounting in the USA, but
whether Trump can outrun "status quo" candidate Hillary remains
to be seen. The power of neoliberal media and neoliberal
brainwashing might yet be way too strong for staging "another
Brexit".
One possibility is that neoliberal elite might resort to
unleashing another world war to solve the existing problems.
Hillary in this sense is a real unmitigated danger.
Doing what contemporary American economists
suggest: eliminate tariffs, don't worry about huge capital inflows or a ridiculously overvalued dollar,
has led the US from being the envy of the world to being a non-developed economy with worse roads
than Cuba or Ghana.
That US economists are still treated with any degree of credibility it totally
appalling. They are so obviously bought-and-paid for snake oil salesmen that people are finally tuning
them out.
TRUMP 2016: Return America to Protectionism - Screw globalism
[There is a pdf at the link. Olivier Blanchard has
surprised me again. As establishment economists go he is not
so bad. There is plenty that he still glosses over but
insofar as status quo establishment macroeconomics goes he is
thorough and coherent. One might hope that those that do not
understand either the debate for higher inflation targets or
the debate for fiscal policy to accomplish what monetary
policy cannot might learn from this article by Olivier
Blanchard, but I will not hold my breath waiting for that. In
any case the article is worth a read for anyone that can.]
RC AKA Darryl, Ron -> RC AKA Darryl, Ron...
,
Friday, September 30, 2016 at 07:07 AM
Get real! No alumni of the Peterson Institute and IMF is
going to go all mushy on the down sides of globalization and
wealth distribution.
The State of Advanced Economies and Related Policy
Debates: A Fall 2016 Assessment
By Olivier Blanchard
Perhaps the most striking macroeconomic fact about
advanced economies today is how anemic demand remains in the
face of zero interest rates.
In the wake of the global financial crisis, we had a
plausible explanation why demand was persistently weak:
Legacies of the crisis, from deleveraging by banks, to fiscal
austerity by governments, to lasting anxiety by consumers and
firms, could all explain why, despite low rates, demand
remained depressed.
This explanation is steadily becoming less convincing.
Banks have largely deleveraged, credit supply has loosened,
fiscal consolidation has been largely put on hold, and the
financial crisis is farther in the rearview mirror. Demand
should have steadily strengthened. Yet, demand growth has
remained low.
Why? The likely answer is that, as the legacies of the
past have faded, the future has looked steadily bleaker.
Forecasts of potential growth have been repeatedly revised
down. And consumers and firms-anticipating a gloomier
future-are cutting back spending, leading to unusually low
demand growth today....
Young people reject neoliberalism... And thus they reject Hillary. As simple as that...
Notable quotes:
"... Here is my own wild take on why millennials don't support Clinton "enough": Many younger American voters, perhaps a sufficient number of them to seriously imperil Clinton's chances, have significant ideological differences with the candidate. That's my theory ..."
"... I would like to suggest that the threat these young voters pose to technocratic [neo]liberalism is not the possibility of electing Donald Trump. Despite Clinton's flagging numbers, her chances of success remain high. Rather, the fear is that if younger voters really are committed to a host of ideological positions at odds with the mainstream of the Democratic Party, then that Party, without a Trump-sized cudgel, is doomed. ..."
"... So why have liberal pundits resisted such a move? Why are they intent on not just defeating but discrediting the ideological preferences of the young left, dismissing them not as a legitimate divergence but as mere ignorance and confusion? ..."
The given causes vary but the consensus is clear: Young voters are pathological and the cure is
to disabuse them of their ignorance.
Here is my own wild take on why millennials don't support Clinton "enough": Many younger American
voters, perhaps a sufficient number of them to seriously imperil Clinton's chances, have significant
ideological differences with the candidate. That's my theory. Many liberal pundits seem unimpressed
by this idea perhaps because it suggests that votes must be earned in a democracy, but it does have
the benefit of the evidence.
... ... ...
I would like to suggest that the threat these young voters pose to technocratic [neo]liberalism
is not the possibility of electing Donald Trump. Despite Clinton's flagging numbers, her chances
of success remain high. Rather, the fear is that if younger voters really are committed to a host
of ideological positions at odds with the mainstream of the Democratic Party, then that Party, without
a Trump-sized cudgel, is doomed. It should not escape anybody's notice that politics by negative
definition-the argument, at bottom, that "we're better than those guys"-has become the dominant electoral
strategy of the Democratic Party, and that despite the escalation of the "those guys" negatives,
the mere promise to be preferable has yielded diminishing returns. At some point, the Democratic
Party will either need to embrace a platform significantly to the left of their current orthodoxy,
or they will lose.
... ... ...
This might not seem such a bad thing. Positions shift. Parties evolve. A serious threat of millennial
desertion might lead to a natural compromise: support, in exchange for real policy concessions going
forward. So why have liberal pundits resisted such a move? Why are they intent on not just defeating
but discrediting the ideological preferences of the young left, dismissing them not as a legitimate
divergence but as mere ignorance and confusion?
Emmett Rensin is a writer based in Iowa City, Iowa. His previous work has appeared in Vox,The
New Republic, The Atlantic and The Los Angeles Review of Books (where he is a contributing editor).
Follow him on Twitter at @EmmettRensin.
"... "Over the last 25 years, the number of people living in extreme poverty has been cut from nearly 40 percent of humanity to under 10 percent." This is roughly true, according to World Bank data, but the story of how it happened goes against his whole speech - which argues that this progress is a result of the "globalization" that Washington leads and supports wherever it has influence in the developing world. In fact, the majority of the reduction in extreme poverty during this period (more than 1.1 billion people worldwide) took place in China. But during this period China was really the counterexample to the "principles of open markets" with which Obama insists "we must go forward, not backward." ..."
"... If we go back a bit more and look at 1981–2012, China accounted for even more of the reduction of the world population in extreme poverty, about 70 percent. This would indicate that other parts of the developing world increased their economic and social progress during the 21st century, relative to China, and indeed many developing countries did (as compared to the last two decades of the 20th century). But China played an increasingly large role in reducing poverty in other countries during this period. ..."
"... It was so successful in its economic growth and development - by far the fastest in world history - that it became the largest economy in the world, and pulled up many developing countries through its imports. Chinese imports went from a negligible 0.1 percent of other developing countries' exports to 3 percent, from 1980–2010. China also provided hundreds of billions of dollars in investment, loans, and aid to low- and middle-income countries in the 21st century. (In the last few years, Chinese growth has slowed, along with that of most countries, and that has contributed - although perhaps not as much as Europe has - to the global slowdown since 2011.) ..."
"... the "principles of open markets" that Obama refers to is really code for "policies that Washington supports." ..."
"... In his defense of a world economic order ruled by Washington and its rich country allies, President Obama also asserted that "we have made international institutions like the World Bank and the International Monetary Fund more representative." But that is a gross exaggeration: the most recent reform of IMF voting shares left the US with an unchanged 16.7 percent share, enough to veto many important decisions (that require an 85 percent majority) by itself; and it left Washington and its traditional rich country allies with a solid majority of more than 60 percent of votes. Of course, it is the developing countries, especially poorer ones, that are most subject to IMF decisions. But the IMF is - by a gentleman's agreement among the rich country governments - headed by a European, and the World Bank by an American. It should not be surprising if these institutions do not look out for the interests of the developing world. ..."
President Obama Inadvertently Gives High Praise to China
in UN Speech
By Mark Weisbrot
President Obama's speech at the UN last week was mostly a
defense of the world's economic and political status quo,
especially that part of it that is led or held in place by
the US government and the global institutions that Washington
controls or dominates. In doing so, he said some things that
were exaggerated or wrong, or somewhat misleading. It is
worth looking at some of the things that media reports on
this speech missed.
"Over the last 25 years, the number of people living
in extreme poverty has been cut from nearly 40 percent of
humanity to under 10 percent." This is roughly true,
according to World Bank data, but the story of how it
happened goes against his whole speech - which argues that
this progress is a result of the "globalization" that
Washington leads and supports wherever it has influence in
the developing world. In fact, the majority of the reduction
in extreme poverty during this period (more than 1.1 billion
people worldwide) took place in China. But during this period
China was really the counterexample to the "principles of
open markets" with which Obama insists "we must go forward,
not backward."
China's historically unprecedented economic growth in the
past 25 years (or 35 years, or even more) was accomplished
with state-owned enterprises and banks dominating the
economy. State control over investment, technology transfer,
and foreign exchange was vastly greater than in other
developing countries. China rejected the neoliberal policies
of an "independent central bank," indiscriminate opening to
international trade and investment, and rapid privatization
of state companies. Instead, it chose a gradual transition,
over 35 years, from an overwhelmingly planned economy to a
mixed economy in which the state still plays a leading role.
Even today, China expanded the investment of state-owned
enterprises by 23.5 percent in the first six months of 2016
(as compared to the same period in 2015), to help boost the
economy.
If we go back a bit more and look at 1981–2012, China
accounted for even more of the reduction of the world
population in extreme poverty, about 70 percent. This would
indicate that other parts of the developing world increased
their economic and social progress during the 21st century,
relative to China, and indeed many developing countries did
(as compared to the last two decades of the 20th century).
But China played an increasingly large role in reducing
poverty in other countries during this period.
It was so
successful in its economic growth and development - by far
the fastest in world history - that it became the largest
economy in the world, and pulled up many developing countries
through its imports. Chinese imports went from a negligible
0.1 percent of other developing countries' exports to 3
percent, from 1980–2010. China also provided hundreds of
billions of dollars in investment, loans, and aid to low- and
middle-income countries in the 21st century. (In the last few
years, Chinese growth has slowed, along with that of most
countries, and that has contributed - although perhaps not as
much as Europe has - to the global slowdown since 2011.)
Of course, the "principles of open markets" that Obama
refers to is really code for "policies that Washington
supports." Some of them are the exact opposite of "open
markets," such as the lengthening and strengthening of patent
and copyright protection included in the Trans-Pacific
Partnership (TPP) agreement. President Obama also made a plug
for the TPP in his speech, asserting that "we've worked to
reach trade agreements that raise labor standards and raise
environmental standards, as we've done with the Trans-Pacific
Partnership, so that the benefits [of globalization] are more
broadly shared." But the labor and environmental standards in
the TPP, as with those in previous US-led commercial
agreements, are not enforceable; whereas if a government
approves laws or regulations that infringe on the future
profit potential of a multinational corporation - even if
such laws or regulations are to protect public health or
safety - that government can be hit with billions of dollars
in fines. And they must pay these fines, or be subject to
trade sanctions.
In his defense of a world economic order ruled by
Washington and its rich country allies, President Obama also
asserted that "we have made international institutions like
the World Bank and the International Monetary Fund more
representative." But that is a gross exaggeration: the most
recent reform of IMF voting shares left the US with an
unchanged 16.7 percent share, enough to veto many important
decisions (that require an 85 percent majority) by itself;
and it left Washington and its traditional rich country
allies with a solid majority of more than 60 percent of
votes. Of course, it is the developing countries, especially
poorer ones, that are most subject to IMF decisions. But the
IMF is - by a gentleman's agreement among the rich country
governments - headed by a European, and the World Bank by an
American. It should not be surprising if these institutions
do not look out for the interests of the developing world.
"We can choose to press forward with a better model of
cooperation and integration," President Obama told the world
at the UN General Assembly. "Or we can retreat into a world
sharply divided, and ultimately in conflict, along age-old
lines of nation and tribe and race and religion."
But the rich country governments led by Washington are not
offering the rest of the world any better model of
cooperation and integration than the failed model they have
been offering for the past 35 years. And that is a big part
of the problem....
China's historically unprecedented economic growth in the
past 25 years (or 35 years, or even more) was accomplished
with state-owned enterprises and banks dominating the
economy. State control over investment, technology transfer,
and foreign exchange was vastly greater than in other
developing countries. China rejected the neoliberal policies
of an "independent central bank," indiscriminate opening to
international trade and investment, and rapid privatization
of state companies. Instead, it chose a gradual transition,
over 35 years, from an overwhelmingly planned economy to a
mixed economy in which the state still plays a leading role.
Even today, China expanded the investment of state-owned
enterprises by 23.5 percent in the first six months of 2016
(as compared to the same period in 2015), to help boost the
economy....
Even today, China expanded the investment of state-owned
enterprises by 23.5 percent in the first six months of 2016
(as compared to the same period in 2015), to help boost the
economy....
Yale Professors Offer Economic Prescriptions
By Brenda Cronin - Wall Street Journal
Richard C. Levin, president of Yale - and also a professor
of economics - moderated the conversation among Professors
Judith Chevalier, John Geanakoplos, William D. Nordhaus,
Robert J. Shiller and Aleh Tsyvinski....
An early mistake during the recession, Mr. Levin said, was
not targeting more stimulus funds to job creation. He
contrasted America's meager pace of growth in gross domestic
product in the past few years with China's often double-digit
pace, noting that after the crisis hit, Washington allocated
roughly 2% of GDP to job creation while Beijing directed 15%
of GDP to that goal....
Repeatedly there are warnings from Western economists that
the Chinese economy is near collapse, nonetheless economic
growth through the first 2 quarters this year is running at
6.7% and the third quarter looks about the same. The point is
to ask and describe how after these last 39 remarkable years:
Before the crash, complacent Democrats, ... tended to agree
with them that the economy was largely self-correcting.
Who is a complacent Democrat? Obama ran as a fiscal
conservative and appointed a GOP as his SecTreas. Geithner
was a "banks need to be bailed out" and the economy self
corrects. Geithner was not in favor of cram down or mortgage
programs that would have bailed out the injured little folks.
Democrats like Romer and Summers were in favor a fiscal
stimulus, but not enough of it. I expect to see the Clinton
economic team include a lot more women and especially focus
on economic policies that help working women and families.
I have always thought that a big reason for the Bush
jobless recovery was his lack of true fiscal stimulus. Bush
had tax cuts for the wealthy, but the latest from Summers
shows why trickle down does not work.
Full employment may have been missing from the 1992
platform, but full employment was pursued aggressively by
Bill Clinton. He got AG to agree to allow unemployment to
drop to 4% in exchange for raising taxes and dropping the
middle class tax cuts. Bill Clinton used fiscal policy to tax
the economy and as a break so monetary policy could be
accommodating.
He should include raising the MinWage. Maybe that has not
changed but it is a lynchpin for putting money in the pockets
of the working poor.
"... Will the media ever stop the ridiculous charade of pretending that the path of globalization that we are on is somehow and natural and that it is the outcome of a "free" market? Are longer and stronger patent and copyright monopolies the results of a free market? ..."
"... The NYT should up its game in this respect. It had a good piece on the devastation to millions of working class people and their communities from the flood of imports of manufactured goods in the last decade, but then it turns to hand-wringing nonsense about how it was all a necessary part of globalization. Actually, none of it was a necessary part of a free trade. ..."
"... First, the huge trade deficits were the direct result of the decision of China and other developing countries to buy massive amounts of U.S. dollars to hold as reserves in this period. This raised the value of the dollar and made our goods and services less competitive internationally. This problem of a seriously over-valued dollar stems from the bungling of the East Asian bailout by the Clinton Treasury Department and the I.M.F. ..."
"... The second point is political leaders are constantly working to make patents and copyrights stronger and longer. This raises the price that ordinary workers have to pay for everything from drugs to computer games. The result is lower real wages for ordinary workers and higher incomes for the beneficiaries of these rents. It also slows economic growth since markets are not smart enough to distinguish between a 10,000 percent price increase due to a tariff and a 10,000 percent price increase due to a patent monopoly. (In other words, all the bad things that "free trade" economists say about tariffs also apply to patents and copyrights, except the impact is far larger in the later case.) ..."
Why are none of the "free trade" members of
Congress pushing to change the regulations that require
doctors go through a U.S. residency program to be able to
practice medicine in the United States? Obviously they are
all protectionist Neanderthals.
Will the media ever stop the ridiculous charade of
pretending that the path of globalization that we are on is
somehow and natural and that it is the outcome of a "free"
market? Are longer and stronger patent and copyright
monopolies the results of a free market?
The NYT should up its game in this respect. It had a good
piece on the devastation to millions of working class people
and their communities from the flood of imports of
manufactured goods in the last decade, but then it turns to
hand-wringing nonsense about how it was all a necessary part
of globalization. Actually, none of it was a necessary part
of a free trade.
First, the huge trade deficits were the direct result of
the decision of China and other developing countries to buy
massive amounts of U.S. dollars to hold as reserves in this
period. This raised the value of the dollar and made our
goods and services less competitive internationally. This
problem of a seriously over-valued dollar stems from the
bungling of the East Asian bailout by the Clinton Treasury
Department and the I.M.F.
If we had a more competent team in place, that didn't
botch the workings of the international financial system,
then we would have expected the dollar to drop as more
imports entered the U.S. market. This would have moved the
U.S. trade deficit toward balance and prevented the massive
loss of manufacturing jobs we saw in the last decade.
The second point is political leaders are constantly
working to make patents and copyrights stronger and longer.
This raises the price that ordinary workers have to pay for
everything from drugs to computer games. The result is lower
real wages for ordinary workers and higher incomes for the
beneficiaries of these rents. It also slows economic growth
since markets are not smart enough to distinguish between a
10,000 percent price increase due to a tariff and a 10,000
percent price increase due to a patent monopoly. (In other
words, all the bad things that "free trade" economists say
about tariffs also apply to patents and copyrights, except
the impact is far larger in the later case.)
Finally, the fact that trade has exposed manufacturing
workers to international competition, but not doctors and
lawyers, was a policy choice, not a natural development.
There are enormous potential gains from allowing smart and
ambitious young people in the developing world to come to the
United States to work in the highly paid professions. We have
not opened these doors because doctors and lawyers are far
more powerful than autoworkers and textile workers. And, we
rarely even hear the idea mentioned because doctors and
lawyers have brothers and sisters who are reporters and
economists.
Addendum:
Since some folks asked about the botched bailout from the
East Asian financial crisis, the point is actually quite
simple. Prior to 1997 developing countries were largely
following the textbook model, borrowing capital from the West
to finance development. This meant running large trade
deficits. This reversed following the crisis as the
conventional view in the developing world was that you needed
massive amounts of reserves to avoid being in the situation
of the East Asian countries and being forced to beg for help
from the I.M.F. This led to the situation where developing
countries, especially those in the region, began running very
large trade surpluses, exporting capital to the United
States. (I am quite sure China noticed how its fellow East
Asian countries were being treated in 1997.)
"... The current US presidential election shows, perhaps better than anything else, just how far that decadence has gone. Hillary Clinton's campaign is floundering in the face of Trump's challenge because so few Americans still believe that the [neo]liberal shibboleths in her campaign rhetoric mean anything at all. ..."
"... Even among her supporters, enthusiasm is hard to find, and her campaign rallies have had embarrassingly sparse attendance. Increasingly frantic claims that only racists, fascists, and other deplorables support Trump convince no one but true believers, and make the concealment of interests behind shopworn values increasingly transparent. Clinton may still win the election by one means or another, but the broader currents in American political life have clearly changed course. ..."
"... Or one could take the idea that "Health" or "College" reform is merely funneling ever more resources to insurance companies and College administrations with precious little if any improvement in the real cost or quality to the users of the service. ..."
Ironies of this sort are anything but unusual in political history. It's astonishingly common
for a movement that starts off trying to overturn the status quo in the name of some idealistic
abstraction or other to check its ideals at the door once it becomes the status quo. If anything,
American liberalism held onto its ideals longer than most and accomplished a great deal more
than many, and I think that most of us-even those who, like me, are moderate Burkean conservatives-are
grateful to the liberal movement of the past for ending such obvious abuses as chattel slavery
and the denial of civil rights to women, and for championing the idea that values as well as
interests deserve a voice in the public sphere. It deserves the modern equivalent of a raised
hat and a moment of silence, if no more, as it finally sinks into the decadence that is the
ultimate fate of every successful political movement.
The current US presidential election shows, perhaps better than anything else, just
how far that decadence has gone. Hillary Clinton's campaign is floundering in the face of Trump's
challenge because so few Americans still believe that the [neo]liberal shibboleths in her campaign
rhetoric mean anything at all.
Even among her supporters, enthusiasm is hard to find, and her campaign rallies have
had embarrassingly sparse attendance. Increasingly frantic claims that only racists, fascists,
and other deplorables support Trump convince no one but true believers, and make the concealment
of interests behind shopworn values increasingly transparent. Clinton may still win the election
by one means or another, but the broader currents in American political life have clearly changed
course.
=====================================
Great article IMHO – I certainly agree about the portion concerning immigration.
And for an example of a contradiction – Police unions and big cities. Unions do much more than
raise wages and pensions – many of the protections of police by hamstringing complaint investigations
against the police are exposing a fissure that has reached the point of earthquake.
Or one could take the idea that "Health" or "College" reform is merely funneling ever more
resources to insurance companies and College administrations with precious little if any improvement
in the real cost or quality to the users of the service.
"... Reuters reports that an investigation conducted by it in 2013 found that around three-fourths of the 50 biggest U.S. technology companies use practices that are similar to Apple's to avoid paying tax. So Verstager has taken on not just one giant, but the worlds corporate elite. She should not lose. But even if she does this time, this is a battle well begun. ..."
"... Thus the power of the multinationals comes not just from their own size and reach, and from the support that their own governments afford them, but from their ability to divide desperate countries seeking the presence of global giants to make a small difference to their economic conditions ..."
"... Those who support globalisation support this power disparity. ..."
The case of Apple's Irish operations is an extreme example of such tax avoidance accounting. It relates
to two Apple subsidiaries Apple Sales International and Apple Operations Europe. Apple Inc US has
given the rights to Apple Sales International (ASI) to use its "intellectual property" to sell and
manufacture its products outside of North and South America, in return for which Apple Inc of the
US receives payments of more than $2 billion per year. The consequence of this arrangement is that
any Apple product sold outside the Americas is implicitly first bought by ASI, Ireland from different
manufacturers across the globe and sold along with the intellectual property to buyers everywhere
except the Americas. So all such sales are by ASI and all profits from those sales are recorded in
Ireland. Stage one is complete: incomes earned from sales in different jurisdictions outside the
Americas (including India) accrue in Ireland, where tax laws are investor-friendly. What is important
here that this was not a straight forward case of exercising the "transfer pricing" weapon. The profits
recorded in Ireland were large because the payment made to Apple Inc in the US for the right to use
intellectual property was a fraction of the net earnings of ASI.
Does this imply that Apple would
pay taxes on these profits in Ireland, however high or low the rate may be? The Commission found
it did not. In two rather curious rulings first made in 1991 and then reiterated in 2007 the Irish
tax authority allowed ASI to split it profits into two parts: one accruing to the Irish branch of
Apple and another to its "head office". That "head office" existed purely on paper, with no formal
location, actual offices, employees or activities. Interestingly, this made-of-nothing head office
got a lion's share of the profits that accrued to ASI, with only a small fraction going to the Irish
branch office. According to Verstager's Statement: "In 2011, Apple Sales International made profits
of 16 billion euros. Less than 50 million euros were allocated to the Irish branch. All the rest
was allocated to the 'head office', where they remained untaxed." As a result, across time, Apple
paid very little by way of taxes to the Irish government. The effective tax rate on its aggregate
profits was short of 1 per cent. The Commissioner saw this as illegal under the European Commission's
"state aid rules", and as amounting to aid that harms competition, since it diverts investment away
from other members who are unwilling to offer such special deals to companies.
In the books, however, taxes due on the "head office" profits of Apple are reportedly treated
as including a component of deferred taxes. The claim is that these profits will finally have to
be repatriated to the US parent, where they would be taxed as per US tax law. But it is well known
that US transnationals hold large volumes of surplus funds abroad to avoid US taxation and the evidence
is they take very little of it back to the home country. In fact, using the plea that it has "permanent
establishment" in Ireland and, therefore, is liable to be taxed there, and benefiting from the special
deal the Irish government has offered it, Apple has accumulated large surpluses. A study by two non-profit
groups published in 2015 has argued that Apple is holding as much as $181 billion of accumulated
profits outside the US, a record among US companies. Moreover, The Washington Post reports that Apple's
Chief Executive Tim Cook told its columnist Jena McGregor, "that the company won't bring its international
cash stockpile back to the United States to invest here until there's a 'fair rate' for corporate
taxation in America."
This has created a peculiar situation where the US is expressing concern about the EC decision
not because it disputes the conclusion about tax avoidance, but because it sees the tax revenues
as due to it rather than to Ireland or any other EU country. US Treasury Secretary Jack Lew criticised
the ruling saying, "I have been concerned that it reflected an attempt to reach into the U.S. tax
base to tax income that ought to be taxed in the United States." In Europe on the other hand, the
French Finance Minister and the German Economy Minister, among others, have come out in support of
Verstager, recognizing the implication this has for their own tax revenues. Governments other than
in Ireland are not with Apple, even if not always for reasons advanced by the EC.
... ... ...
Thus the power of the multinationals comes not just from their own size and reach, and from
the support that their own governments afford them, but from their ability to divide desperate
countries seeking the presence of global giants to make a small difference to their economic
conditions. The costs of garnering that difference are, therefore, often missed. Reuters
reports that an investigation conducted by it in 2013 found that around three-fourths of the 50
biggest U.S. technology companies use practices that are similar to Apple's to avoid paying tax.
So Verstager has taken on not just one giant, but the worlds corporate elite. She should not
lose. But even if she does this time, this is a battle well begun.
I think the common misconception that multinational corporations exist because "they are big
companies that happen to operate in more than one country" is one of the biggest lies ever told.
From the beginning (e.g. Standard Oil, United Fruit) it was clear that multinational status
was an exercise in political arbitrage.
" Thus the power of the multinationals comes not just from their own size and reach, and
from the support that their own governments afford them, but from their ability to divide desperate
countries seeking the presence of global giants to make a small difference to their economic conditions
"
Those who support globalisation support this power disparity.
"... It is not clear what the NYT thinks it is telling readers with this comment. The economy grows and creates jobs, sort of like the tree in my backyard grows every year. The issue is the rate of growth and job creation. While the economy has recovered from the lows of the recession, employment rates of prime age workers (ages 25-54) are still down by almost 2.0 percentage points from the pre-recession level and almost 4.0 percentage points from 2000 peaks. There is much research ** *** showing that trade has played a role in this drop in employment. ..."
"... It is not surprising that Ford's CEO would say that shifting production to Mexico would not cost U.S. jobs. It is likely he would make this claim whether or not it is true. Furthermore, his actual statement is that Ford is not cutting U.S. jobs. If the jobs being created in Mexico would otherwise be created in the United States, then the switch is costing U.S. jobs. The fact that Michigan and Ohio added 75,000 jobs last year has as much to do with this issue as the winner of last night's Yankees' game. ..."
"... The piece goes on to say that the North American Free Trade Agreement has "for more than two decades has been widely counted as a main achievement of [Bill Clinton]." It doesn't say who holds this view. The deal did not lead to a rise in the U.S. trade surplus with Mexico, which was a claim by its proponents before its passage. It also has not led to more rapid growth in Mexico which has actually fallen further behind the United States in the two decades since NAFTA. ..."
"... It is worth noting that none of the analyses that provide the basis for this assertion take into the account the impact of the increased protectionism, in the form of longer and stronger patent and copyright protections, which are a major part of the TPP. These forms of protection are equivalent to tariffs of several thousand percent on the protected items. As they apply to an ever growing share of the economy, the resulting economic losses will expand substantially in the next decade, especially if the TPP is approved. ..."
NYT Editorial In News Section for TPP Short on Substance
When the issue is trade deals, like the Trans-Pacific Partnership (TPP), the New York Times
throws out its usual journalistic standards to push its pro-trade deal agenda. Therefore it is
not surprising to see a story * in the news section that was essentially a misleading advertisement
for these trade deals.
The headline tells readers that Donald Trump's comments on trade in the Monday night debate
lacked accuracy. The second paragraph adds:
"His aggressiveness may have been offset somewhat by demerits on substance."
These comments could well describe this NYT piece.
For example, it ostensibly indicts Trump with the comment:
"His [Trump's] first words of the night were the claim that "our jobs are fleeing the country,"
though nearly 15 million new jobs have been created since the economic recovery began."
It is not clear what the NYT thinks it is telling readers with this comment. The economy
grows and creates jobs, sort of like the tree in my backyard grows every year. The issue is the
rate of growth and job creation. While the economy has recovered from the lows of the recession,
employment rates of prime age workers (ages 25-54) are still down by almost 2.0 percentage points
from the pre-recession level and almost 4.0 percentage points from 2000 peaks. There is much research
** *** showing that trade has played a role in this drop in employment.
The NYT piece continues:
"[Trump] singled out Ford for sending thousands of jobs to Mexico to build small cars and worsening
manufacturing job losses in Michigan and Ohio, but the company's chief executive has said 'zero'
American workers would be cut. Those states each gained more than 75,000 jobs in just the last
year."
It is not surprising that Ford's CEO would say that shifting production to Mexico would
not cost U.S. jobs. It is likely he would make this claim whether or not it is true. Furthermore,
his actual statement is that Ford is not cutting U.S. jobs. If the jobs being created in Mexico
would otherwise be created in the United States, then the switch is costing U.S. jobs. The fact
that Michigan and Ohio added 75,000 jobs last year has as much to do with this issue as the winner
of last night's Yankees' game.
The next sentence adds:
"Mr. Trump said China was devaluing its currency for unfair price advantages, yet it ended
that practice several years ago and is now propping up the value of its currency."
While China has recently been trying to keep up the value of its currency by selling reserves,
it still holds more than $4 trillion in foreign reserves, counting its sovereign wealth fund.
This is more than four times the holdings that would typically be expected of a country its side.
These holdings have the effect of keeping down the value of China's currency.
If this seems difficult to understand, the Federal Reserve now holds more than $3 trillion
in assets as a result of its quantitative easing programs of the last seven years. It raised its
short-term interest rate by a quarter point last December, nonetheless almost all economists would
agree the net effect of the Fed's actions is the keep interest rates lower than they would otherwise
be. The same is true of China and its foreign reserve position.
The piece goes on to say that the North American Free Trade Agreement has "for more than
two decades has been widely counted as a main achievement of [Bill Clinton]." It doesn't say who
holds this view. The deal did not lead to a rise in the U.S. trade surplus with Mexico, which
was a claim by its proponents before its passage. It also has not led to more rapid growth in
Mexico which has actually fallen further behind the United States in the two decades since NAFTA.
In later discussing the TPP the piece tells readers:
"Economists generally have said the Pacific nations agreement would increase incomes, exports
and growth in the United States, but not significantly."
It is worth noting that none of the analyses that provide the basis for this assertion
take into the account the impact of the increased protectionism, in the form of longer and stronger
patent and copyright protections, which are a major part of the TPP. These forms of protection
are equivalent to tariffs of several thousand percent on the protected items. As they apply to
an ever growing share of the economy, the resulting economic losses will expand substantially
in the next decade, especially if the TPP is approved.
Hillary Clinton's campaign manager Robby Mook and other top Democrats refused to answer whether
Clinton wants President Barack Obama to withdraw the Trans Pacific Partnership (TPP) from consideration
before Congress during interviews with Breitbart News in the spin room after the first presidential
debate here at Hofstra University on Monday night.
The fact that Mook, Clinton campaign
spokesman Brian Fallon, and Democratic National Committee (DNC) chairwoman Donna Brazile each refused
to answer the simple question that would prove Clinton is actually opposed to the Trans Pacific Partnership
now after praising it 40 times and calling it the "gold standard" is somewhat shocking.
After initially ignoring the question entirely four separate times, Mook finally replied to Breitbart
News. But when he did respond, he didn't answer the question:
BREITBART NEWS: "Robby, does Secretary Clinton believe that the president should withdraw the
TPP?"
ROBBY MOOK: "Secretary Clinton, as she said in the debate, evaluated the final TPP language
and came to the conclusion that she cannot support it."
BREITBART NEWS: "Does she think the president should withdraw it?"
ROBBY MOOK: "She has said the president should not support it."
Obama is attempting to ram TPP through Congress as his last act as president during a lame duck
session of Congress. Clinton previously supported the TPP, and called it the "Gold Standard" of trade
deals. That's something Brazile, the new chairwoman of the DNC who took over after Rep. Debbie Wasserman
Schultz (D-FL) was forced to resign after email leaks showed she and her staff at the DNC undermined
the presidential campaign of Sen. Bernie Sanders of Vermont and in an untoward way forced the nomination
into Clinton's hands, openly confirmed in her own interview with Breitbart News in the spin room
post debate. Brazile similarly refused to answer if Clinton should call on Obama to withdraw the
TPP from consideration before Congress.
TPP is practically written by the lobbyists from the multi-international corporations that
exploit every possible tax laws, labor laws, environmental and public health regulations, legal
representations and consequences. It is imperialism 2.0 in the 21st century, exclusively serving
the interests of top point one percent while greatly depressing the wages of middle class;
it is overwhelmingly opposed by the public opinion, law makers of all sides and current president
candidates. There is zero chance Obama could make it through legislation before his exit; Clinton
will not even consider bringing it back if she wins the election because she already flip-flopped
once on the issue during her campaign; and it would seriously damage her chance of re-election
if she does. As for Trump, I leave it to anyone's imaginations.
"... Conventionally the US is being outplayed but it is possible that it is playing a different game in which it is complicit in the transition from nation state to corporate oligarchy. Isn't that the Neoliberal end game? ..."
"... The biggest mistake was to enact a policy shunning Russia, when Russia should be a key, partner of Europe and the US. ..."
"... And the USA invaded Vietnam, Panama, Nicaragua with the contras, Iraq, Afghanistan, are currently bombing the crap out of another dozen nations, has militarily occupied another 100 nations with their bases and you are worried about Russia with Georgia and The Ukraine? What in Hades is wrong with this picture? ..."
"... "Barack Obama's 'Asian pivot' failed. China is in the ascendancy" says the heading. So Obama's "Asian pivot" was meant to thwart China's development. ..."
"... And the big problem with Trump's approach is that good ol' American corporations are the ones who are profiting wildly from business in China. They wanted access to the Chinese labor force, e.g. Walmart and every other manufacturer who now peddles goods made in China in US stores. They are the entities that cost western workers millions of jobs, creating massive trade deficits. ..."
"... They are wealthy beyond measure and anyone who wants to alter this system whereby American corporations manufacture in China and ship products around the world, inc. to the US, would have to fight them. And if anyone believes that Trump would succeed in this battle, they are delusional. ..."
"... "These two juggernauts are on a collision course" is far too alarmist. Relying mainly on right-wing US thinktanks for analysis doesn't help. ..."
"... Now we are waking up to the realisation that we are the big loosers of globalisation. ..."
"... "The west has been long living under the illusion that the so called globalised world would be beneficial for all. " No, actually they thought it would be beneficial for the Western countries mostly. And it was, but whatever benefits developing countries received allowed them to rise to the level of a potential future threat to the unquestionable Western dominance. And now the US is looking for a way to destroy them preemptively. The US is paranoid. ..."
"... I think this "ascendancy" and nationalistic fervor is actually a sign of internal turmoil. ..."
"... The labor supply is assured because there are still multi millions in poverty and signing up as cheap labor is exactly what brings them out of poverty. I assume you've never been to China and therefore have never heard of Chunyun, the largest human migration in the world. This is partly the ruralites returning home from the cities with their years spoils. This year individual journeys totalled almost 3bn. ..."
"... By the way, China is reducing it's land army by a third over the next few years and has just concluded very constructive summits with all it's neighbours during last weeks ASEAN bunfight. ..."
"... a collapse of the chinese economy would collapse the American economy as well ..."
"... Fascinating & well structured article - except for one glaring omission - the LNP selling of the Port of Darwin to a Chinese Government business. Yeh, sure it's a '99 year lease' but for all effective purposes it's a sellout of a strategic port to the Chinese Government. ..."
"... America is in terminal decline, beset by economic and fiscal crises, sapped by imperial overstretch, a victim of a cosmopolitan ennui and fecklessness, divided politically and culturally, belligerent and militant to the extreme. An empire in decline is at its most dangerous. America today is a far greater threat to world peace than China. Simply witness America's accommodation of the Israeli occupation of Palestine, the odious Saudi theocracy, and how its insane policy in Libya, Syria, Iraq, and Afghanistan has led to hundreds of thousands of lives lost and millions displaced ..."
"... The US has no significantly greater percentage of debt than any of the other Western nations except Germany. If you think the Americas bankrupt then you'd have to think a whole lot of other nations including the UK is as well. ..."
"... "China has divided and conquered certain countries in SE Asia." These certain SE Asian countries would say that it's because they are not willing to be Uncle Sam's "yes man". ..."
"... The US is still so very powerful but the problem is they feel powerless from time to time with their hammer in hand against flying mosquitos. Why they always wanted to solve problems using force is beyond stupidity. ..."
"... It also destabilises the entire region. Something the Americans are masters of. ..."
"... Were the US to form a cooperative instead of confrontational relationship with China the world would be a better place. The same could be said for the US relationship with Russia. ..."
"... Of course the military-industrial-banking-congressional complex that governs Washington's behavior would not be happy. WIthout confrontation the arms industries can't sell their weapons of war, banks' profits take a hit and congress critters don't get their kickbacks, err, "donations". ..."
"... Given the way the US government has screwed the Philippines over steadily since 1898, it's not surprising that Pres. Dutarte has decided to be friendly with his neighbor. Obama of the Kill List lecturing other countries about human rights abuses! What hypocrisy. ..."
"... Is what China doing in the south china sea different from what the USA does in the gulf of Mexico or in Panama... not to mention that Chi a is litterally surounded by US bases that sit squarely across all its sea trading routes: Korea, Japan, Taiwan, Fillipines ..."
"... China has been accumulating debt at unprecedented rates to try to maintain faltering growth. In 2007 Chinese debt stood at $7 trillion. By 2014 it had quadrupled to $28 trillion. That's $60 billion of extra debt every week. It's still rising rapidly as the government desperately tries to keep momentum. ..."
"... TPP is practically written by the lobbyists from the multi-international corporations that exploit every possible tax laws, labor laws, environmental and public health regulations, legal representations and consequences. It is imperialism 2.0 in the 21st century, exclusively serving the interests of top point one percent while greatly depressing the wages of middle class; it is overwhelmingly opposed by the public opinion, law makers of all sides and current president candidates. There is zero chance Obama could make it through legislation before his exit; Clinton will not even consider bringing it back if she wins the election because she already flip-flopped once on the issue during her campaign; and it would seriously damage her chance of re-election if she does. As for Trump, I leave it to anyone's imaginations. ..."
"... Globalisation is another word for one world government and all that brings, one currency, one police force, taxation, dissolution of borders, an end to sovereignty and all of our hard won freedoms. Freedom is a thing of the past, with MSM owned by the globalist elites, enforcing a moratorium on truth, and a population that has no idea what is going on behind the scenes. ..."
"... Another brilliant thought from Rand; when in doubt, shoot from the hip .... ..."
"... They tell their employers what they want to hear. ..."
"... Do Americans not realize that Chinese and Russians read this too and plan accordingly? This is madness. I am fairly certain preemptive strikes are against international law. Why nobody has the guts to call the US out on this kind of illegal warmongering? ..."
"... The dilemma is clear: amid rising nationalism in both countries, China is not willing to have its ambitions curbed or contained and the US is not ready to accept the world number two spot. These two juggernauts are on a collision course. ..."
"... What does the criticism in USA get you? It is just blah blah blah. ONly criticism that matters is from the corporations and wealthy individuals like Koch bros and Sheldon Edelson and their ilk. Rest can watch football. ..."
"... Simon Tisdall and many Europeans as well as the US GOP party still thinks that US is an empire similar to what the British had in the 18th century. This assumption is completely wrong especially in the 21th century where Western Europe, Japan, Korea if they want can be spend their money and also become global military power. ..."
"... Being a large country surrounded by many other occasionally threatening powers, the governments' priority is and always has been defending its territorial integrity. China is happy enough to leave the command and conquer stuff, sorry "democratization" to the US. ..."
"... Why did Obama say that his greatest regret was Libya.? Because Obama's policy is/was to manage the decline of US power. To manage the end of US hegemony. I doubt that Obama believes that any pivot to any where can restore or maintain US dominance on planet earth. ..."
"... China wishes to expand trade and improve economic conditions for its people and for those with whom it trades. That is not aggression except when it interferes with US global economic hegemony. ..."
"... The most belligerent nation in the world the nation with its army in over 100 countries, the nation bombing and conducting perpetual war throughout the middle east, the country invading countries for "regime change" and creating only misery and death -- it is not China. ..."
"... The US and its Neoliberal capitalist system must expand to grow - plus they clearly want total global domination - the US and its Imperial agents have encircled both China and Russia with trillions of dollars of the most destructive weapons in the world including nuclear weapons - do you thin they have done that for "security" if so you simply ignore the aggression and hubris of an Imperial US. ..."
Before the pivot could even get underway the Saudis threw their rattle out of the pram and drew
US focus back to the Middle East and proxy war two steps removed with Russia. Empires don't get
to focus, they react to each event and seek to gain from the outcome so the whole pivot idea was
flawed.
Obama's foreign policy has been clumsy and amoral. It remains to be seen whether it will become
more so in an effort to double down. Under Clinton it definitely will, under Trump who knows but
random isn't a recommendation.
Conventionally the US is being outplayed but it is possible that it is playing a different
game in which it is complicit in the transition from nation state to corporate oligarchy. Isn't
that the Neoliberal end game?
So the Rand Think Tank would sooner have war now than later. Who wouldda guessed that.
The Chinese want to improve trade and business with the rest of the world. The US answer? destroy
China militarily. so who best to lead the world. I think the article answers that question unintentionally.
The rest of the world has had it up to the ears with American military invasions, regeime changes,
occupations and bombing of the world. They are ready for China´s approach to international relations.
it is about time the adults took over the leadership of the world. Europe and the USA and their
offspring have clearly failed.
China has been handed everything it needs to fly solo: money, factories, IP, etc. Fast forwarding
into the western civic model limits (traffic, pollution, etc.), its best bet is to offload US
"interests" and steer clear.
No clear sign India's learned/recovered from British occupation, as they let tech create more
future Kanpurs.
The biggest mistake was to enact a policy shunning Russia, when Russia should be a key, partner
of Europe and the US.
Was it really worth expanding NATO to Russia's borders instead of offering neutrality to former
Soviet States and thus retain Russia's confidence in global matters that far out weigh the interests
of the neo-cons?
neutrality? Russia invaded non-NATO members Georgie, Ukraine, and Moldavia, and created puppet-states
on their soil.
The Jremlin-rules are simple: the former Sovjet states should be ruled by a pro-Russian dictator
(Bella-Russia, Kazachstan, etc. etc...). Democracies face boycots, diplomatic and military support
of rebels, and in the end simply a military invasion.
The only reason why the baltic states are now thriving democracies, is that they are NATO members.
And the USA invaded Vietnam, Panama, Nicaragua with the contras, Iraq, Afghanistan, are currently
bombing the crap out of another dozen nations, has militarily occupied another 100 nations with
their bases and you are worried about Russia with Georgia and The Ukraine? What in Hades is wrong
with this picture?
When Obama took office his first major speech was in Cairo - where he said
"I have come here to seek a new beginning between the United States and Muslims around
the world," US President Barack Obama said to the sounds of loud applause which rocked not
only the hall, but the world. "One based upon mutual interest and mutual respect; and one based
upon the truth that America and Islam are not exclusive, and need not be in competition. Instead,
they overlap, and share common principles-principles of justice and progress; tolerance and
the dignity of all human beings."
He displayed a dangerous mix of innocence, foolishness, disregard for the truth and misunderstanding
of the nature of Islamic regimes - does the West have common values with Lebanon which practices
apartheid for Palestinians, Saudi, where women cannot drive a car, Syria, where over 17,000 have
died in Assad's torture chambers, we can go on and on.
And on China - Trump has it right - China has been manipulating its currency exchange rate
for years, costing western workers millions of jobs, creating massive trade deficits and something
needs to be done about it.
" America and Islam are not exclusive, and need not be in competition. Instead, they overlap,
and share common principles-principles of justice and progress; tolerance and the dignity of
all human beings. "
He spoke about the whole of Islam, not specific " Islamic regimes ". And he is correct
on it. All religions share a great deal of values with the USAmerican constition and even each
other .
The overwhelming majority of USAmerican muslims have accepted the melting pot with their whole
heart, second generation children have JOINED its fighting forces to protect the interest of the
USA all over the world. Normally this full an integration is reached with the third generation.
The west has won against those religious fanatics. How else to explain that exactly the people
those claim to speak turn up with us?
And the big problem with Trump's approach is that good ol' American corporations are the ones
who are profiting wildly from business in China. They wanted access to the Chinese labor force,
e.g. Walmart and every other manufacturer who now peddles goods made in China in US stores. They
are the entities that cost western workers millions of jobs, creating massive trade deficits.
They are wealthy beyond measure and anyone who wants to alter this system whereby American
corporations manufacture in China and ship products around the world, inc. to the US, would have
to fight them. And if anyone believes that Trump would succeed in this battle, they are delusional.
"These two juggernauts are on a collision course" is far too alarmist. Relying mainly on right-wing
US thinktanks for analysis doesn't help.
Interesting in particular to see RAND is still in its Cold War mindset. There's famous footage
of RAND analysts in the 60s (I think) discussing putative nuclear war with the USSR and concluding
that the US was certain of 'victory' following a missile exchange because its surviving population
(after hundreds of millions of deaths and the destruction of almost all urban centres) would be
somewhat larger.
China's island claims are all about a broader strategic aim- getting unencumbered access to
the Pacific for its growing blue water navy. It's not aimed at Taiwan or Japan in any sort of
specific sense and, save for the small possibility of escalation following an accident (ships
colliding or something), there's very little risk of conflict in at least the medium term.
It's crucial to remember just how much China and the US depend upon each other economically.
The US is by far China's largest single export market, powering its manufacturing economy. In
return, China uses the surplus to buy up US debt, which allows the Americans to borrow cheaply
and keep the lights on. Crash China and you crash the US- and vice versa.
For now, China is basically accepting an upgraded number 2 spot (along with the US acknowledging
them as part of a 'G2'), but supporting alternative governance structures when it doesn't like
the ones controlled by the US/Japan (so the Asian Infrastructure Investment Bank, the BRICS etc.).
This doesn't mean that the two don't see each other as long term strategic and economic rivals.
But the risks to both of rocking the boat are gigantic and not in the interest of either party
in the foreseeable future. Things that could change that:
a. a succession of Trump-like US presidents (checks and balances are probably sufficient to
withstand one, were it to come to that);
b. a revolution in China (possible if the economy goes South- and what comes next is probably
not liberal democracy but anti-Japanese or anti-US authoritarian nationalism);
c. an unpredictable chain of events arising from N Korean collapse or a regional nuclear race
(Japan-China is a more likely source of conflict than US-China).
"The west has been long living under the illusion that the so called globalised world would
be beneficial for all. " No, actually they thought it would be beneficial for the Western countries
mostly. And it was, but whatever benefits developing countries received allowed them to rise to
the level of a potential future threat to the unquestionable Western dominance. And now the US
is looking for a way to destroy them preemptively. The US is paranoid.
The writing is on the wall: the future is with China. All the US can do is make nice or reap the
dire consequences. If China can clean up its human rights record, I would be happy to see them
supplant or rival the US as a global hegemon. After all, looked at historically, haven't they
earned it? - An American, born and bred, but no nationalist
Well, that is naïve. Look at China and how the Chinese people are governed. Look at the US. And
please don't tell me you don't see a difference. I'll take a world with the US as the global hegemon
any day.
A regional counter balance is needed. Cooperation is hindered by Japan. They should be the center
point of a regional alliance strong enough to contain China with US help, but it doesn't work:
whilst everybody fears China, everybody hates Japan.
The reason is they failed miserably to rebuild trust after WWII, rather than going cap in hand,
acknowledging respondibility for atrocities and other crimes and injustice, and compensate victims,
they kept their pride and isolation. They are now paying the price - possibly together with the
rest of us.
Maybe a full scale change after 7 decades of to-little-to-late diplomacy can still achieve
sth.
The ass the US should kick sits in Tokyo - something they failed to do properly after WWII,
when they managed it well in West Germany (ok - they had help from the Brits there, who for all
their failings understand foreign nations far better), where it facilitated proper integration
into European cooperation.
I think this "ascendancy" and nationalistic fervor is actually a sign of internal turmoil.
Countries that do well don't need to crack down on dissidents to the point of kidnappings
or spend millions of stupid man made islands that pisses everyone off but have all the military
value of a threatening facial tattoo. The South China Sea tactics is partially Chinese "push until
something pushes back" diplomacy but also stems from the harsh realisation that their resources
can be easily choked of and even the CPC knows it can't hold down a billion plus Chinese people
once the hunger sets it.
China is facing the dilemna that as it brings people out of poverty it reduces the supply of
the very cheap labor that makes it rich. You can talk about Lenovo all you want, no one is buying
a Chinese car anytime soon. Nor is any airline outside of China going to buy one of their planes.
Copyright fraud is one thing the West can retaliate easily upon and will if they feel China has
gone too far. Any product found in a western court to be a blatant copy can effectively be banned.
The next step is to refuse to recognize Chinese copyright on the few genuine innovations that
come out of it.
Plus the deal Deng Xiaoping made with the urban classes is fraying. It was wealth in exchange
for subservience. The people in the cities stay out of direct politics but quality of life issues,
safety, petty corruption and pollution are angering them and scaring them hence the vast amount
of private Chinese money being sunk into global real estate.
The military growth and dubious technobabble is just typical Chinese mianzi gaining. If you
do have a brand new jet stealth jet fighter, you don't release pictures of it to the world press.
They got really rattled when Shinzo Abe decided the JSDF can go and deliver slappings abroad to
help their friends if needed. Because an army that spends a lot of time rigging up Michael Bayesque
set maneuvers for the telly is not what you want to pit against top notch technology handled by
obsessive perfectionists.
No one plays hardball with China because we all like cheap shit. But once that is over then
China is a very vulnerable country with not one neighbour they can call a friend. They know it.
Obama hasn't failed.. It's the histrionics that prove it not the other way round.
The labor supply is assured because there are still multi millions in poverty and signing
up as cheap labor is exactly what brings them out of poverty. I assume you've never been to China
and therefore have never heard of Chunyun, the largest human migration in the world. This is partly
the ruralites returning home from the cities with their years spoils. This year individual journeys
totalled almost 3bn.
No-one is buying a Chinese car? Check the sales for Wuling. They produce the small vans that
are the lifeblood of the small entrepreneur. BYD are already exporting electric buses to London.
The likes of VW, BMW, Land Rover, are all in partnership with Chinese auto-makers and China is
the largest car market in the world.
Corruption has been actively attacked and over a quarter of a million officials have been brought
to book in Xi's time in office. The pollution causing steel and coal industries are being rapidly
contracted and billions spent on re-training.
Plus the fact that while the Chinese are mianzi gazing, the last thing they think about is
politics. They simply don't want to know.
By the way, China is reducing it's land army by a third over the next few years and has
just concluded very constructive summits with all it's neighbours during last weeks ASEAN bunfight.
The conclusion is that bi-lateral talks, not US led pissing contests are the way forward.
"What has happened is the ICA has ruled against China in the SCS..." Nothing new. The UN Commission on the Limits of Continental Shelf had also ruled against the
UK and the International Court of Justice had ruled against the US.
Fascinating & well structured article - except for one glaring omission - the LNP selling
of the Port of Darwin to a Chinese Government business. Yeh, sure it's a '99 year lease' but for
all effective purposes it's a sellout of a strategic port to the Chinese Government.
Just look at how gobsmacked the US Military & President were over such a stupidly undertaken
sale by the LNP. This diplomatically lunatic sell off by the LNP of such a vital national asset
has effectively taken-out any influence or impact Australia may have, or exert, over critical
issues happening on our northern doorstep.
If there was ever a case for buying back a strategic national asset, this is definitely the
one. Oh, if folks are worried about the $Billions in penalties incurred, simple solution - just
stop the $Billions of Diesel Fuel Rebates gifted to Miners for, say, 10 years..... Done!
America is in terminal decline, beset by economic and fiscal crises, sapped by imperial overstretch,
a victim of a cosmopolitan ennui and fecklessness, divided politically and culturally, belligerent
and militant to the extreme. An empire in decline is at its most dangerous. America today is a
far greater threat to world peace than China. Simply witness America's accommodation of the Israeli
occupation of Palestine, the odious Saudi theocracy, and how its insane policy in Libya, Syria,
Iraq, and Afghanistan has led to hundreds of thousands of lives lost and millions displaced.
Europe
is under siege by endless tides of refugees that are the direct consequence of America's neo-Conservative
and militant foreign policy. Meanwhile, America's neo-liberal economic and trade policies have
not only decimated her own manufacturing base and led to gross inequality but also massive dislocations
in South America, Middle East, Europe, Africa, and Southeast Asia. Tired, irritated, frustrated,
exhausted, cynical, violent, moral-less, deeply corrupt, and rudderless, America is effectively
bankrupt and on the verge of becoming another Greece, if not for the saving grace of the petro-Dollar.
Europe would be well-advised to keep the Yanks at arm's length so as to escape as much as possible
the fallout from her complete collapse. As for Britain, soon to be divorced from the EU, time
draws nigh to end the humiliating, one-sided servitude that is the 'Special Relationship' and
forge an independent foreign policy. The tectonic plates of history is again shifting, and there
nothing America can do to stop it.
I don't know America probably occupies the most prime geographical spot on the planet, and buffered
by two oceans. It doesn't have to worry about refugees and the other problems and ultimately they
can produce enough food and meet all of its energy needs domestically. And it's the third most
populous nation on earth and could easily grow its population with immigration.
The US has no significantly greater percentage of debt than any of the other Western nations
except Germany. If you think the Americas bankrupt then you'd have to think a whole lot of other
nations including the UK is as well.
Given the facts it would be daft a write off America. Every European nation have lost their
number one spot in history and they seem to be doing just fine. Is there some reason why this
can't be America's destiny as well? Does it really have to end in flames?
"China has divided and conquered certain countries in SE Asia."
These certain SE Asian countries would say that it's because they are not willing to be Uncle
Sam's "yes man".
The US is still so very powerful but the problem is they feel powerless from time to time with
their hammer in hand against flying mosquitos. Why they always wanted to solve problems using
force is beyond stupidity.
Pivot to Asia is about one thing only, sending more war ships to encircle China. But for what
purpose exactly? It does one thing though, it united china by posing as a threat.
Those blaming Obama most stridently for not keeping China in its box are those most responsible
for China's rise. American and Western companies shafted their own people to make themselves more
profit. They didn't care what the consequences might be, as long as the lmighty "Shareholder Value"
continued to rise. Now they demand that the taxes from all those people whose jobs they let go
be used to contain the new superpower that they created. As usual, Coroporate America messes
things up then demands to know what someone else is going to do about it
Were the US to form a cooperative instead of confrontational relationship with China the world
would be a better place. The same could be said for the US relationship with Russia.
Of course the military-industrial-banking-congressional complex that governs Washington's behavior
would not be happy. WIthout confrontation the arms industries can't sell their weapons of war,
banks' profits take a hit and congress critters don't get their kickbacks, err, "donations".
Given the way the US government has screwed the Philippines over steadily since 1898, it's not
surprising that Pres. Dutarte has decided to be friendly with his neighbor. Obama of the Kill List lecturing other countries about human rights abuses! What hypocrisy.
fuck his pivot.....this ain't syria.....having destroyed the middle east it was our turn.....this
is americas exceptionalism........stay #1 by desabilising/destroying everyone else.....p.s. shove
the TPP also..........
The real question is why should not China be more dominant in Asia... i understands the USA tendency
especially since the fall of the soviet union at seing themselves as the only world superpower.
And i understand why China would like to balance tbat especially in her own neighborhood.
Is what China doing in the south china sea different from what the USA does in the gulf of Mexico
or in Panama... not to mention that Chi a is litterally surounded by US bases that sit squarely
across all its sea trading routes: Korea, Japan, Taiwan, Fillipines,... and considering that the
chinese have a long memory of werstern gunboat diplomacy and naval for e projection, if i was
them i would feel a little uncomfortable at how vulnerable my newfound trade is... especially
when some western politician so clearly think that china needs to be contained...
China has been accumulating debt at unprecedented rates to try to maintain faltering growth.
In 2007 Chinese debt stood at $7 trillion. By 2014 it had quadrupled to $28 trillion. That's
$60 billion of extra debt every week. It's still rising rapidly as the government desperately tries to keep momentum.
Much of this money has been funnelled into 'investments' that will never yield a return. The most almighty crash is coming. Which will be interesting to say the least.
Now that is interesting but odd. They are buying phuqing HUGE swathes of land in Africa, investing
everywhere they can on rest of the planet. All seemingly on domestic debt then.
Yes. The Japanese went on a spending spree abroad in the 1980s, while accumulating debt at home,
and when that popped the economy entered 20 years of stagnation, as bad debts hampered the financial
system.
The Chinese bubble is far larger, and made worse by the fact that much of the debt has been
taken on by inefficient state owned enterprises and local government, spending not because the
figures make sense but to meet centrally-dictated growth targets. Much of the rest has been funnelled
into real estate, which now makes up more than twice the share of the Chinese economy than is
the case in the UK. Property prices in some major Chinese cities have reached up to 30 times local
incomes, making London look cheap in comparison.
TPP is practically written by the lobbyists from the multi-international corporations that exploit
every possible tax laws, labor laws, environmental and public health regulations, legal representations
and consequences. It is imperialism 2.0 in the 21st century, exclusively serving the interests
of top point one percent while greatly depressing the wages of middle class; it is overwhelmingly
opposed by the public opinion, law makers of all sides and current president candidates. There
is zero chance Obama could make it through legislation before his exit; Clinton will not even
consider bringing it back if she wins the election because she already flip-flopped once on the
issue during her campaign; and it would seriously damage her chance of re-election if she does.
As for Trump, I leave it to anyone's imaginations.
Don't believe for a second Hillary won't ram through a version of the TPP/IP if she wins. What
she's actually said is that she's against it in its current form
Remember she is part of an owned by the 0.1% that stand to benefit from the agreement, she
will do their bidding and be well rewarded. A few cosmetic changes will be applied to the agreement
so she can claim that she wasn't lying pre-election and we'll have to live with the consequences.
Well done all you globalists for failing to spot the bleedin obvious...that millions of homes
worldwide full of 'Made In China' was ultimately going to pay for the People's Liberation
Army. Still think globalisation is wonderful ?
Quite. How can you believe in a liberal, global free market and then do business with the Socialist
Republic of China, that is the antithesis of free markets. The name is above the door, so there's
no use acting all surprised when it doesn't pan out the way you planned it.
Anything good can be made evil, including globalization. Imagine fair trade completely globalized
so very nation relies on every other nation for goods. That type of shared destiny is the only
way to maintain peace because humans are tribalist to a fault. We evolved in small groups, our
social dynamics are not well suited to large diverse groups. If nation has food but nation B does
not, nation B will go to war with nation A, so hopefully both nations trade and alleviate that
situation. Nations with high economic isolation are beset by famines and poverty. Germany usually
beats China in total exports and Germany is a wonderful place to live. It's not globalization
that is the problem, it's exploitation and failure of our leaders to follow and enforce the Golden
Rule.
Roll out the barrel.....
Well said and you are so right.
15 years ago, I had a conversation in an airport with an American. I remarked that, by outsourcing
manufacturing to China the US had sold its future to an entity that would prove to be their enemy
before too long. I was derided and ridiculed. I wonder where that man is and whether he remembers
our conversation.
Globalisation is another word for one world government and all that brings, one currency, one
police force, taxation, dissolution of borders, an end to sovereignty and all of our hard won
freedoms. Freedom is a thing of the past, with MSM owned by the globalist elites, enforcing a
moratorium on truth, and a population that has no idea what is going on behind the scenes.
I despair of "normalcy bias" and the insulting term "conspiracy theorist". People have lost
the ability to work things out for themselves and the majority knows nothing about Agenda 21 aka
Sustainable Development Goals 2030, until the land grabs start and private ownership is outlawed.
... the study also suggests that, if war cannot be avoided, the US might be best advised to
strike first, before China gets any stronger and the current US military advantage declines further
..
Another brilliant thought from Rand; when in doubt, shoot from the hip ....
Do Americans not realize that Chinese and Russians read this too and plan accordingly? This is
madness.
I am fairly certain preemptive strikes are against international law. Why nobody has the guts
to call the US out on this kind of illegal warmongering?
1. With respect, Mr Tidsall is badly off track in painting China as the one evil facing an innocent
world.
2. The fact is that US' belief in and repeated resort to force has created a huge mess in the
Middle East, brought true misery to millions, and truly thrown Europe in turmoil in the bargain.
3. Besides this Middle East mess, the US neoliberal economic policies have wreaked havoc, culminating
in an unprecedented financial and economic crisis that has left millions all over the world without
any hope for the future
4. Hence Mr Tidsall's pronouncement:
This dilemma – how to work constructively with a powerful, assertive China without compromising
or surrendering national interests – grows steadily more acute.
Ought to read:
This dilemma – how to work constructively with a powerful, assertive United States
without compromising or surrendering national interests – grows steadily more acute.
5. US would be better advised to focus on its growing social problems, evident in the growing
random killings, police picking on blacks, etc, and on its fast decaying infrastructure. We now
read that China has the fastest computer, the largest telescope, etc, whilst US just kills and
kills all over the world.
6. Mr Tidsall, may I request that you kindly focus on realities rather than come up with opinion
that approaches science fiction
I agree that Mr Tisdall's treatment of the US is somewhat naive and ignorant. However couldn't
it be that both countries are capable of aggression and assertiveness? The US's malign influence
is mainly focussed on the Middle East and North Africa region, while China's is on its neighbours.
China's attitude to Taiwan is pure imperialism, as is its treatment of dissenting voices on the
mainland and in Hong Kong. China's contempt for international law and the binding ruling by the
UNCLOS Arbitral Tribunal is also deeply harmful to peace and justice in the region and worldwide.
We now read that China has the fastest computer, the largest telescope, etc, whilst US just
kills and kills all over the world.
Very superficial indeed - compare, just as one example, the number of Nobel prizes won by American
scientists recently with those by Chinese. The US is still, in general, far ahead of China in
terms of scientific research (though China is making rapid progress). (That is not intended to
excuse US killing of course.)
The US follows the USSR path of increasingly ignoring the needs of its own population in order
to retain global dominance. It will end the same as the USSR. That which cannot continue will
not continue.
Xi is not looking for a fight. His first-choice agent of change is money, not munitions.
According to Xi's "One Belt, One Road" plan, his preferred path to 21st-century Chinese hegemony
is through expanded trade, business and economic partnerships extending from Asia to the Middle
East and Africa. China's massive Silk Road investments in central and west Asian oil and gas
pipelines, high-speed rail and ports, backed by new institutions such as the Asia Infrastructure
Investment Bank, are part of this strategy, which simultaneously encourages political and economic
dependencies. Deng Xiaoping once said to get rich is glorious. Xi might add it is also empowering.
The most realistic assessment on Xi and China.
The dilemma is clear: amid rising nationalism in both countries, China is not willing to
have its ambitions curbed or contained and the US is not ready to accept the world number two
spot. These two juggernauts are on a collision course.
A Grim and over-paranoid predicament: US is not in decline and need not worry about China's "ambition";
China is well aware it remains a poor nation compared to developed world and is decades behind
of US in military, GDP per capital and science, that is not including civil liberty, citizen participation,
Gov't transparency and so on. China is busy building a nation confident of its culture and history,
military hegemony plays no part of its dream.
US is not in decline and need not worry about China's "ambition"
Oh come on, $20 Trillion in debt and with Social Security running out of money, there will
be no more to lend the government.
China has forged an agreement with Russia for all its needs in oil ( Russia has more oil than
Saudi Arabia) and payment will not be in US dollars. Russia will not take US$ for trade and the
BRICS nations will squeeze the US$ out of its current situation as reserve currency. When the
dollars all find their way back to the USA hyperinflation will cause misery.
Before the Chinese or anyone else gets any ideas, they should reflect on the size of the US defence
budget, 600 billion dollars in 2015, and consider what that might imply in the event of conflict.
a third of that budget goes in profit for the private companies they employ to make duds like
the F35 - so you can immediately reduce that to 400 billion. The US have been fighting third world
countries for 50 years, and losing, their military is bloated, out of date and full of retrograde
gear that simply wont cut it against the Russians. Privately you would find that most top line
military agree with that statement. They also have around 800 bases scattered world wide, spread
way too thin. Its why theyve stalled in Ukraine and can't handle the middle east. The Russians
spend less than $50 billion but have small, highly mobile forces, cutting edge missile defence
systems (which will have full airspace coverage by 2017). The Chinese policy of A2D/AD or access
denial has got the US surface fleet marooned out in the oceans as any attempt to get close enough
to be effective would be met with a hail of multiple rocket shedding war heads. The only place
where it is probable (but my no means certain) that the US still has the edge is in submarine
warfare, although again if the Russians and Chinese have full coverage of their airspace nothing
(or little) would get through.
Two theorys are in current operation about the election and the waring factions in the NSA and
the CIA 1) HRC wins but is too much of a warmonger and would push america into more wars they
simply cannot win 2) there is a preference for Trump to win amongst the MIC because he would (temporarily)
seek 'peace' with the Russians thus giving the military the chance to catch up - say in 3 or 4
years - plus all the billions and billions of dollars that would mean for them.
Overwhelming fire power no longer wins wars, the US have proved that year in year out since
the end of the second world war, theyve lost every war theyve started/caused/joined in. Unless
you count that limited skirmish on British soil in Grenada - and I guess we could call Korea a
score draw. The yanks are bust and they know it, the neocons are all bluster and idiots like Breedlove,
Power and Nuland are impotent because they don't have right on their side or the might to back
it up. The US is mired in the middle east, locked out of asia and would grind to halt in Europe
against the Russians. (every NATO wargame simulation in the last 4 years has conclusively shown
this) Add to that the fact that the overwhelming majority of US citizens dont have the appetite
for a conventional war and in the event of a nuclear war the US would suffer at least as much
as Europe and youve got a better picture of where we are at.
Well it is just ABOUT money.Also during Vietnam and Iraq war US was biggest spender.
Nobody in US still thinks that Vietnam war was a good idea and the same applies to Iraq.Iraq war
will be even in history books for biggest amount spend to achieve NOTHING.
Chinese military spending is at least on a par with American. A huge part of American military
money goes to personnel salary while China does NOT pay to Chinese soldiers for their service
as China holds a compulsory military service system.
This article assumes China is evil and the US is the righteous protector of all nations in the
SE Asian region against the evil China which is obviously out to destroy the hapless SE Asian
nations. This assumption is obviously nonsense. The US itself is rife with racial problems. Everybody
has seen what it had done to Vietnam. Nobody believes that a racist US that cares nothing for
the welfare of its own black, Latino and Asian population will actually care for the welfare of
the same peoples outside of the US and especially in SE Asia.
The truth is China is not the evil destroyer of nations. The truth is the US is the evil destroyer
of nations. The US has brought nothing but bloodshed and destruction to the SE Asian regions for
the last 200 years. The US had killed millions of Filipinos during it colonial era. The US had
killed millions of Vietnamese during the Vietnam War. The US had incited pogroms against the ethnic
Chinese unceasingly. The May 13 massacre in Malaysia, the anti-Chinese massacres in the 1960's
and the 1990's in Indonesia, and many other discrimination and marginalization of ethnic Chinese
throughout the entire SE Asia are all the works of the US. It is the US that is the killer and
destroyer.
Therefore, it is a good thing that the evil intents of the US had failed. With the all but
inevitable rise of China, the influence of the Japanese and the americans will inevitably wane.
The only danger to China is the excessive xenocentrism of the Dengist faction who is selling out
China to these dangerous enemies. If the CPC government sold out China's domestic economy, then
China will become a colony of the Japanese and americans without firing a single shot. And the
Chinese economy will slide into depression as it had done in the Qing Dynasty and Chinese influence
in the SE Asian region will collapse.
Therefore, the task before the CPC government is to ban all foreign businesses out of China's
domestic economy, upgrade and expand China's education and R&D, urbanize the rural residents and
expand the Chinese military, etc. With such an independent economic, political and military policies,
China will at once make itself the richest and the most powerful nation in the world dwarfing
the Japanese and American economies and militaries. China can then bring economic prosperity and
stability to the SE Asian region by squeezing the evil Japanese and americans out of the region.
Lets be honest what has Obama achieved,he got the Nobel peace prize for simply not being George
Bush Jr he has diplayed a woeful lack of leadership with Russia over Syria Libya and the Chinese
Simply being the first African American president will not be a legacy
Do you know of one Leninist state that ever built a prosperous modern industrial nation? Therein
lies the advantage and the problem with China. China is totally export dependant and therefore
its customers can adversely affect its economy - put enough chinese out of work and surely political
instability will follow. A threatened dictatorship with a large army, however, is a danger to
its neighbors and the world.
China are now net consumers. You need to read up on whats happening, not from just the western
press. They are well on their way to becoming the most powerful nation on earth, they have access
(much like Russia) to over two thirds of the population of the worlds consumers and growing (this
is partially why sanctions against Russia have been in large part meaningless) China will never
want for buyers of their products (the iphone couldnt be made without the Chinese) with the vast
swaithes of unplumbed Russian resources becoming available to them its hard to see how the west
can combat the Eurasians. The wealth is passing from west to east, its a natural cycle the 'permanant
growth' monkies in the west have been blind to by their own greed and egotism. Above all the Chinese
are a trading nation, always seeking win/win trading links. The west would be better employed
trading and linking culturally with the Chinese rather than trying to dictate with military threats.
The west comprises only 18% of the global population and our growth and wealth is either exhausted
or locked away in vaults where it is doing no one any good. Tinme to wise up or get left behind.
Tisdall...absolute war-monger and neo-con "dog of war". Is this serious journalism? The rise of
China was as inevitable as the rise of the US in the last century..."no man can put a stop to
the march of a nation". It's Asias century and it's not the first time for China to be the No
1 economy in the world. They have been here before and have much more wisdom than the west...for
too long the tail has wagged the dog...suck it up Tisdall!
The US grand strategy post-Bush was to reposition itself at the heart of a liberal economic system
excluding China through TTIP with the EU and TPP with Asia-Pac ex. China and Russia. The idea
was that this would enable the US to sustain its hegemony.
It has been an absolute failure. Brexit has torpedoed TTIP and TPP has limited value- the largest
economy in the partnership, Japan, has been largely integrated in to the US for the past 70 years.
IMO the biggest failure of the US has been hating Russia too much. The Russians have just as
much reason to be afraid of China as the US do and have a pretty capable army. If the US patched
things up with the Russians, firstly it could redeploy forces and military effort away from the
Middle East towards Asia Pac and secondly it would give the US effective leverage over China-
with the majority of the oil producing nations aligned with the US, China would have difficulty
in conducted a sustained conflict. It's old Cold War thinking that has seen America lose its hegemony-
similar to how the British were so focused on stopping German ascendancy they didn't see the Americans
coming with the knife.
America is reaping the fruits of what they sowed during the time of Reagan. It was never a good
idea to outsource your entire manufacturing industry to a country that is a dictatorship and does
not embrace western liberal democratic values. Now the Americans are hopelessly dependent on China
- a country that does not play by the rules in any sphere - it censors free speech, it blatantly
violates intellectual property, it displays hostile intent towards nearly all South East Asian
countries, its friends include state sponsors of terror like Pakistan and North Korea, it is carefully
cultivating the enemies of America and the west in general.
In no way, shape or form does China fulfill the criteria for being a trustworthy partner of
the west. And yet today, China holds all the cards in its relationship with the west, with the
western consumerist economies completely dependent on China. Moral of the story - Trade and economics
cannot be conducted in isolation, separate from geopolitical realities. Doing so is a recipe for
disaster.
Mr Tisdall should declare his affiliation, if any, with the military-industrial complex.
It is surprising coming from a Briton which tried to contain Germany and fought two
wars destroying itself and the empire. War may be profitable for military-industrial complex
but disastrous for everyone else. In world war 2, USA benefited enormously by ramping
up war material production and creating millions of job which led to tremendous
prosperity turning the country around from a basket case in 1930s to a big prosperous power
which dominated the world till 2003.
US insistence on being top cat in a changing world will end up by dragging us all into a WW III.
Why can't the US leave the rest of the world alone? Americans do not need a military presence
to do business with the rest of the world and earn a lot of money with such trade. And they are
too ignorant, too unsophisticate and too weak to be able to impose their will on the rest of us.
The (very) ugly Americans are back and all we want is for them to go back home and forever remain
there... The sooner the better...
The world is going to look fantastically different in a hundred years time.
Points of world power will go back to where they was traditionally; Europe and Asia. America
is a falling power, it doesn't get the skilled European immigrants it use to after German revolution
and 2 world wars. And it's projected white population will be a minority by 2050. America's future
lies with south America.
Australia with such a massive country but with a tiny population of 20million will look very
attractive to China. It's future lies with a much stronger commonwealth, maybe a united military
and economic commonwealth between the UK, Canada, Australia and New Zealand.
Even without the EU, Europe is going to have to work together, including Russia to beat the
Chinese militarily and economically. America will not be the same power in another 30-50 years
and would struggle to beat them now.
China are expansionists, always have been. War is coming with them and North Korea sometime
in the future.
From the article above, it is clear who is the more dangerous power. While China is aiming to
be the hegemon through economic means like the neo silk road projects, the US is aiming to maintain
its hegemon status through military power. The US think thank even suggest to preemptive strike
against China to achieve that. This is also the problem with US pivot to Asia, it may fail to
contain China, but it didn't fail to poison the atmosphere in Asia. Asia has never been this dangerous
since the end of cold war, all thanks to the pivot.
Obama is trying to maintain the status quo. China and N. Korea are the ones pushing military intimidation.
The key to the US plan is to form an alliance between countries in the region that historically
distrust each other. The Chinese are helping that by threatening everybody at the same time. Tisdall
sees this conflict strictly as between the US and China. Obama's plan is to form a group of countries
to counter China. Japan will have a major role in this alliance but the problem is whether the
other victims of WW2 Japanese aggression will agree to it.
The US's disastrous foreign policy since 9/11 which has unleashed so much chaos in Afghanistan,
Iraq, Libya, Syria, etc etc... is not exactly a commendation for credibility these days.
A useful summary of the state of play in the Pacific and SCS. It is somewhat hawkish in analysis,
military fantasists will always be legion, they should be listened to with extra large doses of
salt, or discussion of arguments which favour peaceful cooperation and development, such as trade,
cultural relations, and natural stalemates. American anxiety at its own perception of decline,
is at least as dangerous for the world as the immature expression of rising Chinese confidence.
But the biggest problem it seems we face, is finding a way to accommodate and translate the aspirations
of rising global powers with the existing order established post-45, in incarnated in the UN and
other international bodies, in international maritime law as in our western notions of universal
human rights. Finding a way for China to express origination of these ideas compatible with its
own history, to be able to proclaim them as a satisfactory settlement for human relations, is
an ideal, but apparently unpromising task.
Perhaps Samuel P Huntingdon was broadly correct when he wrote "The Clash of Civilizations" in
the late 90's. He was criticized for his work by neo-liberals who believed that after the Cold
War the rest of the world would follow the west and US in particular.
The problem with the neo-liberal view is that only their opinions on issues are correct, and
all others therefore should be ridiculed. What has happened in Ukraine is a prime example. Huntingdon
called the Ukraine a "cleft" country split between Russia and Europe. The EU and the US decided
to stir up trouble in the Ukraine to get even with Putin over Syria. It was never about EU or
NATO membership for the Ukraine which is now further away than ever.
A Trump presidency is regarded with fear. The Obama presidency has been a failure with regard
to foreign policy and a major reason was because Clinton was Secretary of State in the 1st four
years. In many ways a Clinton presidency is every bit as dangerous as a Trump presidency.
Certainly relations with Russia will be worse under Clinton than under Trump, and for the rest
of the world that is not a good thing. To those that believe liek Clinton that Putin is the new
Hitler, then start cleaning out the nuclear bunkers. If he is then WW3 is coming like it or not
and Britain better start spending more on defence.
What does the criticism in USA get you? It is just blah blah blah.
ONly criticism that matters is from the corporations and wealthy individuals
like Koch bros and Sheldon Edelson and their ilk. Rest can watch football.
Never mind that a general, high-intensity war in Northern Asia would be disastrous for all involved,
whatever the outcome.
Never mind that much of the discussion about containing China is by warmongers urging such
a conflict.
Never mind that very little depth in fact lies behind the shell of American and Japanese military
strength, or that a competently-run Chinese government is well able to grossly outproduce "us"
all in war materiel.
Never mind that those same warmongers and neocons drove and drive a succession of Imperial
disasters; they remain much-praised centres of attention, just as the banksters and rentiers that
are sucking the life from Americans have never had it so good.
Never mind that abbott encouraged violence as the automatic reaction to problems, while his
Misgovernment was (while Turnbull to a lesser extent still is) working hard to destroy the economic
and social strengths we need to have any chance of surmounting those problems.
Yes, it is a proper precaution to have a military strength that can deny our approaches to
China. Unfortunately that rather disregards that "we" have long pursued a policy of globalisation
involving the destruction of our both own manufacturing and our own merchant navy. Taken together
with non-existent fuel reserves, "our" military preparations are pointless, because we would have
to surrender within a fortnight were China to mount even a partial maritime blockade of Australia.
What I don't quite understand is how all this comes as any surprise to those in the know. China
has been on target to be the #1 economic power in the world in this decade for at least 30 years.
And who made it so? Western capitalists. China is now not only the world's industrial heartbeat,
it also owns a large proportion of Western debt - despite the fact that its differences with the
West (not least being a one-party Communist state) couldn't be more obvious - and while I doubt
it's in its interests to destabilise its benefactorrs at the moment, that may not always be the
case.
It also has another problem: In fifty or sixty years time it is due to be overtaken by India,
which gives it very little time to develop ASEAN in its own image; but I suspect that it's current
"silk glove" policy is far smarter and more cost-effective than any American "iron fist".
The US is just worried about losing out on markets and further exploitation. They should have
no authority over China's interest in the South China Sea. If China do rise to the point were
they can affect foreign governments, they will unlikely be as brutal as the United States. [Indonesia
1964, Congo 1960s, Brazil 1964, Chile 1973, Central America 1980s, Egyptian military aid, Saudi
support, Iraq 2003, the Structural Adjustments of the IMF]
Simon Tisdall and many Europeans as well as the US GOP party still thinks that US is an empire
similar to what the British had in the 18th century. This assumption is completely wrong especially
in the 21th century where Western Europe, Japan, Korea if they want can be spend their money and
also become global military power.
While many Europeans and others including our current GOP party
thinks we are the global empire and we should stick our nose everywhere, our people doesn't we
are an empire or we should stick our nose in every trouble spot in the world spending our blood
and treasure to fight others battles and get blame when everything goes wrong. President Obama
doesn't think of himself as Julius Ceaser and America is not Rome.
He will be remembered as one
of our greatest president ever setting a course for this country's foreign policy towards trying
to solve the world's problems through alliances and cooperation with like minded countries as
the opposite of the war mongering brainless, trigger happy GOP presidents. However when lesser
powers who preach xenophobia and destabilize their neighborhood through annexation as the Hitler
like Putin has, he comes down with a hammer using tools other than military to punish the aggressor.
All you need to do is watch what is happening to the Russian economy since he imposed sanctions
to the Mafiso Putin.
This article is completely misleading and the author is constricting himself in his statement
that Obama's pivot to Asia is a failure. Since China tried to annex the Islands near the Philippines,
countries like Vietnam, Indonesia, Philippines, India, etc. has ask the US for more cooperation
both military and economically these countries were moving away from US under Bush and others
so I think this is a win for Obama not a loss. Unlike the idiotic Russians, China is a clever
country and is playing global chess in advancing her foreign policy goals. While the US cannot
do anything with China's annexation of these disputed Islands has costs her greatly because the
Asian countries effected by China's moves are running towards the US, this is a win for the US.
China's popularity around her neighborhood has taken a nose dive similar to Russian's popularity
around her neighborhood. These are long term strategic wins for the US, especially if Hillary
wins the white house and carry's on Obama's mantel of speaking softly but carry a big stick. Obama
will go down as our greatest foreign policy president by building alliances in Europe to try stop
Mafioso Putin and alliances in Asia to curtail China's foreign policy ambitions. This author's
thesis is pure bogus, because he doesn't indicate what Obama should have done to make him happy?
Threaten Chine military confertation?
All you have to do is go back 8 years ago and compare our last two presidents and you can see
where Obama is going.
For the allusion to Rome, I think they act like the old empire when they had to send their army
to keep the peace....and it is an empire of the 21 first century, not like the old ones (Assange).
China needs western consumerism to maintain its manufacturing base. If China's growth impacts
the ability of the West to maintain its standard of consumerism, then China will need a new source
of affluent purchaser. If China's own citizens become affluent, they will expect a standard of
living commensurate with that status, accordingly China will not be able to maintain its manufacturing
base.
So the options for China are:
a) Prop up western economies until developing nations in Africa and South America (themselves
heavily dependent on the West) reach a high standard of consumerism.
b) Divide China into a ruling class, and a worker class, in which the former is a parasite
on the latter.
The current tactic seems to be to follow option b, until option a becomes viable.
However, the longer option a takes to develop, and therefore the longer option b is in effect,
the greater the chances of counter-revolution (which at this stage is probably just revolution).
The long and the short of it, is that China is boned.
Being a large country surrounded by many other occasionally threatening powers, the governments'
priority is and always has been defending its territorial integrity. China is happy enough to
leave the command and conquer stuff, sorry "democratization" to the US.
It's got it's hands full
at home. As long as the West doesn't try to get involved in what China sees as its historical
territory (i.e. The big rooster shaped landmass plus Hainan and Hong Kong and various little islands)
there's absolutely nothing to worry about.
Why did Obama say that his greatest regret was Libya.? Because Obama's policy is/was to manage
the decline of US power. To manage the end of US hegemony. I doubt that Obama believes that any
pivot to any where can restore or maintain US dominance on planet earth. There is absolutely nothing
exceptional about a power not admitting publicly what is known to many,see the outpourings of
the British elites during the end of its empire.
As usual the Guardian is on its anti-China horse. Look through this article and every move China
has made is "aggressive" or when it tries to expand trade (and produce win win economic conditions)
it is "hegemonic" while the US is just trying to protect us all and is dealing with the "Chinese
threat" -- a threat to their economic interests and global imperial hegemony is what they mean.
The US still maintains a "one China" policy and the status quo is exactly that "one China"
It would be great for someone in the west to review the historical record instead of arming Taiwan
to the teeth. Additionally, before China ever started its island construction the US had already
begun the "pivot to Asia" which now is huge with nuclear submarines patrolling all around China,
nuclear weapons on the - two aircraft carrier fleets now threatening China - very rare for the
US to have two aircraft carrier fleets in the same waters - the B-1 long range nuclear bombers
now in Australia, and even more belligerent the US intends to deploy THAAD missals in South Korea
- using North Korea as an excuse to further seriously threaten China.
China wishes to expand trade and improve economic conditions for its people and for those with
whom it trades. That is not aggression except when it interferes with US global economic hegemony.
Just look around the world - where are the conflicts - the middle east and Africa - who is
there with military and arms sales and bombing seven countries -- is it China?
The most belligerent nation in the world the nation with its army in over 100 countries, the
nation bombing and conducting perpetual war throughout the middle east, the country invading countries
for "regime change" and creating only misery and death -- it is not China.
The US and its Neoliberal capitalist system must expand to grow - plus they clearly want total
global domination - the US and its Imperial agents have encircled both China and Russia with trillions
of dollars of the most destructive weapons in the world including nuclear weapons - do you thin
they have done that for "security" if so you simply ignore the aggression and hubris of an Imperial
US.
"... By Miguel Niño-Zarazúa, Research Fellow, UNU-WIDE, Laurence Roope, Researcher, Health Economics Research Centre, University of Oxford, and Finn Tarp, Director, UNU-WIDER. Originally published at VoxEU ..."
"... See original post for references ..."
"... John Ross argues that the reduction in poverty has been pretty much all China. I'm also not convinced China is actually that much richer than before. A sweatshop worker has a higher income than a traditional farmer, but probably has a lower standard of living, and while the traditional farmer maintains the natural resource base, the industrial worker destroys it. ..."
"... Globalization is an economic and ecological disaster. We have outsourced wealth creation to China and they do it in the most polluting way possible, turning their country into a toxic waste dump in the process. ..."
"... The peasants slaving away in the cinder block hellholes of their factories churning out the crapola on Wal-Mart's shelves also get paid squat, while the leaders of the Chinese Criminal Party steal half of their effort for themselves and smuggle the loot out, to get away from the pollution. The other half gets stolen by the likes of Wal-Mart and Apple. ..."
"... The elites sold globalization as something that would generate such a munificent surplus that those in harms way would be helped. It ends up as a lie, where the elites the world over help themselves to the stolen sweat of the lowest people in society, with nothing left over, except for a polluted planet. ..."
"... Yes, those who "have seen their incomes stagnating in real terms for over 20 years" are indeed experiencing "considerable discontent." But this anodyne phrasing masks the reality of entire communities seeing their means of livelihood ripped out and shipped across the globe. This rhetoric makes it sound like, Oh those prosperous American workers can't buy as many luxuries now, boo hoo, when the standard practice from NAFTA on of globalization-as-corporate-welfare has meant real impoverishment for hundreds of thousands of individuals, entire cities and large chunks of whole states. As Lambert always says, Whose economy? ..."
...if you look at absolute inequality, as opposed to relative inequality, inequality has increased
around the world. This calls into question one of the big arguments made in favor of globalization:
that the cost to workers in advanced economies are offset by gains to workers in developing economies,
and is thus virtuous by lowering inequality more broadly measured.
By Miguel Niño-Zarazúa, Research Fellow, UNU-WIDE, Laurence Roope, Researcher, Health
Economics Research Centre, University of Oxford, and Finn Tarp, Director, UNU-WIDER. Originally published
at VoxEU
Since the turn of the century, inequality in the distribution of income, together with concerns
over the pace and nature of globalisation, have risen to be among the most prominent policy issues
of our time. These concerns took centre stage at the recent annual G20 summit in China. From President
Obama to President Xi, there was broad agreement that the global economy needs more inclusive and
sustainable growth, where the economic pie increases in size and is at the same time divided more
fairly. As President Obama emphasised, "[t]he international order is under strain." The consensus
is well founded, following as it does the recent Brexit vote, and the rise of populism (especially
on the right) in the US and Europe, with its hard stance against free trade agreements, capital flows
and migration.
... ... ...
The inclusivity aspect of growth is now more imperative than ever. Globalisation has not been
a zero sum game. Overall perhaps more have benefitted, especially in fast-growing economies in the
developing world. However, many others, for example among the working middle class in industrialised
nations, have seen their incomes stagnating in real terms for over 20 years. It is unsurprising that
this has bred considerable discontent, and it is an urgent priority that concrete steps are taken
to reduce the underlying sources of this discontent. Those who feel they have not benefitted, and
those who have even lost from globalisation, have legitimate reasons for their discontent. Appropriate
action will require not only the provision of social protection to the poorest and most vulnerable.
It is essential that the very nature of the ongoing processes of globalisation, growth, and economic
transformation are scrutinised, and that broad based investments are made in education, skills, and
health, particularly among relatively disadvantaged groups. Only in this way will the world experience
sustained – and sustainable – economic growth and the convergence of nations in the years to come.
John Ross argues that the reduction in poverty has been pretty much all China. I'm also
not convinced China is actually that much richer than before. A sweatshop worker has a higher
income than a traditional farmer, but probably has a lower standard of living, and while the traditional
farmer maintains the natural resource base, the industrial worker destroys it.
Only in this way will the world experience sustained – and sustainable
– economic growth and the convergence of nations in the years to come.
Globalization is an economic and ecological disaster. We have outsourced wealth creation
to China and they do it in the most polluting way possible, turning their country into a toxic
waste dump in the process.
The peasants slaving away in the cinder block hellholes of their factories churning out
the crapola on Wal-Mart's shelves also get paid squat, while the leaders of the Chinese Criminal
Party steal half of their effort for themselves and smuggle the loot out, to get away from the
pollution. The other half gets stolen by the likes of Wal-Mart and Apple.
The elites sold globalization as something that would generate such a munificent surplus
that those in harms way would be helped. It ends up as a lie, where the elites the world over
help themselves to the stolen sweat of the lowest people in society, with nothing left over, except
for a polluted planet.
The notable presence of public policies that exacerbate racial and economic inequality and
the lack of will by Washington to change the system mean that the ethnic/racial wealth gap is
becoming more firmly entrenched in society.
"broad based investments are made in education, skills, and health, particularly among relatively
disadvantaged groups. Only in this way will the world experience sustained – and sustainable
– economic growth and the convergence of nations in the years to come."
…I guess if the skills were sustainable low chemical and diverse farming in 5 acre lots or
in co-ops then I might have less complaint, however the skills people apparently are going to
need are supervising robots and going to non jobs in autonomous vehicles and being fed on chemical
mush shaped like things we used to eat, a grim dystopia.
Yesterday I had the unpleasant experience of reading the hard copy nyt wherein kristof opined
that hey it's not so bad, extreme poverty has eased (the same as in this article, but without
this article's Vietnamese example where 1 v. 8 becomes 8 v. 80),ignoring the relative difference
while on another lackluster page there was an article saying immigrants don't take jobs from citizens
which had to be one of the most thinly veiled press releases of some study made by some important
sounding acronym and and, of course a supposed "balance" between pro and anti immigration academics.
because in this case, they claim we're relatively better off.
So there you have it, it's all relative. Bi color bird cage liner, dedicated to the ever shrinking
population of affluent/wealthy who are relatively better off as opposed to the ever increasing
population of people who are actually worse off…There was also an article on the desert dwelling
uighur and their system of canals bringing glacier water to farm their arid land which showed
some people who were fine for thousands of years, but now thanks to fracking, industrial pollution
and less community involvement (kids used to clean the karatz, keeping it healthy) now these people
can be uplifted into the modern world(…so great…) that was reminiscent of the nyt of olde which
presented the conundrum but left out the policy prescription which now always seems to be "the
richer I get the less extreme poverty there is in the world so stop your whining and borrow a
few hundred thousand to buy a PhD "
Yes, those who "have seen their incomes stagnating in real terms for over 20 years" are
indeed experiencing "considerable discontent." But this anodyne phrasing masks the reality of
entire communities seeing their means of livelihood ripped out and shipped across the globe. This
rhetoric makes it sound like, Oh those prosperous American workers can't buy as many luxuries
now, boo hoo, when the standard practice from NAFTA on of globalization-as-corporate-welfare has
meant real impoverishment for hundreds of thousands of individuals, entire cities and large chunks
of whole states. As Lambert always says, Whose economy?
Three reading recommendations for anyone who doesn't grasp your sentiment, shared by millions:
Sold Out , by Michelle Malkin Outsourcing America , by Ron Hira America: Who
Stole the Dream? , by Donald L. Barlett
Reply ↓
"... traditional ways of life are dissolving as a new class of entrepreneur-warriors are wielding unprecedented power - and changing the global landscape. ..."
"... It's a huge psychological dent in people's faith in the system. I think what's going to happen in the next few years is huge unemployment in the middle class in America because a lot of their jobs will be outsourced or automated. ..."
Novelist Rana Dasgupta recently turned to nonfiction to explore the explosive
social and economic changes in Delhi starting in 1991, when India launched a
series of transformative economic reforms. In
Capital: The Eruption of Delhi, he describes a city where the epic hopes
of globalization have dimmed in the face of a sterner, more elitist world. In
Part 1 of an interview with the
Institute for New Economic
Thinking, Dasgupta traces a turbulent time in which traditional ways
of life are dissolving as a new class of entrepreneur-warriors are wielding
unprecedented power - and changing the global landscape.
Lynn Parramore: Why did you decide to move from New York to Delhi
in 2000, and then to write a book about the city?
Rana Dasgupta: I moved to be with my partner who lived in Delhi, and soon
realized it was a great place to have landed. I was trying write a novel and
there were a lot of people doing creative things. There was a fascinating intellectual
climate, all linked to changes in society and the economy. It was 10 years since
liberalization and a lot of the impact of that was just being felt and widely
sensed.
There was a sense of opportunity, not any more just on the part of business
people, but everyone. People felt that things were really going to change in
a deep way - in every part of the political spectrum and every class of society.
Products and technology spread, affecting even very poor people. Coke made ads
about the rickshaw drivers with their mobile phones -people who had never had
access to a landline. A lot of people sensed a new possibility for their own
lives.
Amongst the artists and intellectuals that I found myself with, there were
very big hopes for what kind of society Delhi could become and they were very
interested in being part of creating that. They were setting up institutions,
publications, publishing houses, and businesses. They were thinking new ideas.
When I arrived, I felt, this is where stuff is happening. The scale of conversations,
the philosophy of change was just amazing.
LP: You've interviewed many of the young tycoons who emerged during
Delhi's transformation. How would you describe this new figure? How do they
do business?
RD: Many of their fathers and grandfathers had run significant provincial
businesses. They were frugal in their habits and didn't like to advertise themselves,
and anyway their wealth remained local both in its magnitude and its reach.
They had business and political associates that they drank with and whose weddings
they went to, and so it was a tight-knit kind of wealth.
But the sons, who would probably be now between 35 and 45, had an entirely
different experience. Their adult life happened after globalization. Because
their fathers often didn't have the skills or qualifications to tap into the
forces of globalization, the sons were sent abroad, probably to do an MBA, so
they could walk into a meeting with a management consultancy firm or a bank
and give a presentation. When they came back they operated not from the local
hubs where their fathers ruled but from Delhi, where they could plug into federal
politics and global capital.
So you have these very powerful combinations of father/son businesses. The
sons revere the fathers, these muscular, huge masculine figures who have often
done much more risky and difficult work building their businesses and have cultivated
relationships across the political spectrum. They are very savvy, charismatic
people. They know who to give gifts to, how to do favors.
The sons often don't have that set of skills, but they have corporate skills.
They can talk finance in a kind of international language. Neither skill set
is enough on its own by early 2000's: they need each other. And what's interesting
about this package is that it's very powerful elsewhere, too. It's kind of a
world-beating combination. The son fits into an American style world of business
and finance, but the thing about American-style business is that there are lots
of things in the world that are closed to it. It's very difficult for an American
real estate company or food company to go to the president of an African country
and do a deal. They don't have the skills for it. But even if they did, they
are legally prevented from all the kinds of practices involved, the bribes and
everything.
This Indian business combination can go into places like Africa and Central
Asia and do all the things required. If they need to go to market and raise
money, they can do that. But if they need to sit around and drink with some
government guys and figure out who are the players that need to be kept happy,
they can do that, too. They see a lot of the world open to themselves.
LP: How do these figures compare to American tycoons during, say,
the Gilded Age?
RD: When American observers see these people they think, well, we had these
guys between 1890 and 1920, but then they all kind of went under because there
was a massive escalation of state power and state wealth and basically the state
declared a kind of protracted war on them.
Americans think this is a stage of development that will pass. But I think
it's not going to pass in our case. The Indian state is never going to have
the same power over private interests as the U.S. state because lots of things
have to happen. The Depression and the Second World War were very important
in creating a U.S. state that was that powerful and a rationale for defeating
these private interests. I think those private interests saw much more benefit
in consenting to, collaborating in, and producing a stronger U.S. state.
Over time, American business allied itself with the government, which did
a lot to open up other markets for it. In India, I think these private interests
will not for many years see a benefit in operating differently, precisely because
continents like Africa, with their particular set of attributes, have such a
bright future. It's not just about what India's like, but what other places
are like, and how there aren't that many people in the world that can do what
they can do.
LP: What has been lost and gained in a place like Delhi under global
capitalism?
RD: Undeniably there has been immense material gain in the city since 1991,
including the very poorest people, who are richer and have more access to information.
What my book tracks is a kind of spiritual and moral crisis that affects rich
and poor alike.
One kind of malaise is political and economic. Even though the poorest are
richer, they have less political influence. In a socialist system, everything
is done in the name of the poor, for good or for bad, and the poor occupy center
stage in political discourse. But since 1991 the poor have become much less
prominent in political and economic ideology. As the proportion of wealth held
by the richest few families of India has grown massively larger, the situation
is very much like the break-up of the Soviet Union, which leads to a much more
hierarchical economy where people closest to power have the best information,
contacts, and access to capital. They can just expand massively.
Suddenly there's a state infrastructure that's been built for 70 years or
60 years which is transferred to the private domain and that is hugely valuable.
People gain access to telecommunication systems, mines, land, and forests for
almost nothing. So ordinary people say, yes, we are richer, and we have all
these products and things, but those making the decisions about our society
are not elected and hugely wealthy.
Imagine the upper-middle-class guy who has been to Harvard, works for a management
consultancy firm or for an ad agency, and enjoys a kind of international-style
middle-class life. He thinks he deserves to make decisions about how the country
is run and how resources are used. He feels himself to be a significant figure
in his society. Then he realizes that he's not. There's another, infinitely
wealthier class of people who are involved in all kinds of backroom deals that
dramatically alter the landscape of his life. New private highways and new private
townships are being built all around him. They're sucking the water out of the
ground. There's a very rapid and seemingly reckless transformation of the landscape
that's being wrought and he has no part in it.
If he did have a say, he might ask, is this really the way that we want this
landscape to look? Isn't there enormous ecological damage? Have we not just
kicked 10,000 farmers off their land?
All these conversations that democracies have are not being had. People think,
this exactly what the socialists told us that capitalism was - it's pillage
and it creates a very wealthy elite exploiting the poor majority. To some extent,
I think that explains a lot of why capitalism is so turbulent in places like
India and China. No one ever expected capitalism to be tranquil. They had been
told for the better part of a century that capitalism was the imperialist curse.
So when it comes, and it's very violent, and everyone thinks, well that's what
we expected. One of the reasons that it still has a lot of ideological consensus
is that people are prepared for that. They go into it as an act of war, not
as an act of peace, and all they know is that the rewards for the people at
the top are very high, so you'd better be on the top.
The other kind of malaise is one of culture. Basically, America and Britain
invented capitalism and they also invented the philosophical and cultural furniture
to make it acceptable. Places where capitalism is going in anew do not have
200 years of cultural readiness. It's just a huge shock. Of course, Indians
are prepared for some aspects of it because many of them are trading communities
and they understand money and deals. But a lot of those trading communities
are actually incredibly conservative about culture - about what kind of lifestyle
their daughters will have, what kinds of careers their sons will have. They
don't think that their son goes to Brown to become a professor of literature,
but to come back and run the family business.
LP: What is changing between men and women?
RD: A lot of the fallout is about families. Will women work? If so, will
they still cook and be the kind of wife they're supposed to be? Will they be
out on the street with their boyfriends dressed in Western clothes and going
to movies and clearly advertising the fact that they are economically independent,
sexually independent, socially independent? How will we deal with the backlash
of violent crimes that have everything to do with all these changes?
This capitalist system has produced a new figure, which is the economically
successful and independent middle-class woman. She's extremely globalized in
the sense of what she should be able to do in her life. It's also created a
set of lower-middle-class men who had a much greater sense of stability both
in their gender and professional situation 30 years ago, when they could rely
on a family member or fellow caste member to keep them employed even if they
didn't have any marketable attributes. They had a wife who made sure that the
culture of the family was intact - religion, cuisine, that kind of stuff.
Thirty years later, those guys are not going to get jobs because that whole
caste value thing has no place in the very fast-moving market economy. Without
a high school diploma, they just have nothing to offer. Those guys in the streets
are thinking, I don't have a claim on the economy, or on women anymore because
I can't earn anything. Women across the middle classes - and it's not just across
India, it's across Asia -are trying to opt out of marriage for as long as they
can because they see only a downside. Remaining single allows all kinds of benefits
– social, romantic, professional. So those guys are pretty bitter and there's
a backlash that can become quite violent. We also have an upswing of Hindu fundamentalism
as a way of trying to preserve things. It's very appealing to people who think
society is falling apart.
LP: You've described India's experience of global capitalism as traumatic.
How is the trauma distinct in Delhi, and in what ways is it universal?
RD: Delhi suffers specifically from the trauma of Partition, which has created
a distinct society. When India became independent, it was divided into India
and Pakistan. Pakistan was essentially a Muslim state, and Hindis and Sikhs
left. The border was about 400 kilometers from Delhi, which was a tiny, empty
city, a British administrative town. Most of those Hindis and Sikhs settled
in Delhi where they were allocated housing as refugees. Muslims went in the
other direction to Pakistan, and as we know, something between 1 and 2 million
were killed in that event.
The people who arrived in Delhi arrived traumatized, having lost their businesses,
properties, friends, and communities, and having seen their family members murdered,
raped and abducted. Like the Jewish Holocaust, everyone can tell the stories
and everyone has experienced loss. When they all arrive in Delhi, they have
a fairly homogeneous reaction: they're never going to let this happen to them
again. They become fiercely concerned with security, physical and financial.
They're not interested in having nice neighbors and the lighter things of life.
They say, it was our neighbors that killed us, so we're going to trust only
our blood and run businesses with our brother and our sons. We're going to build
high walls around our houses.
When the grandchildren of these people grow up, it's a problem because none
of this has been exorcised. The families have not talked about it. The state
has not dealt with it and wants to remember only that India became independent
and that was a glorious moment. So the catastrophe actually becomes focused
within families rather than the reverse. A lot of grandchildren are more fearful
and hateful of Muslims than the grandparents, who remembered a time before when
they actually had very deep friendships with Muslims.
Parents of my generation grew up with immense silence in their households
and they knew that in that silence was Islam - a terrifying thing. When you're
one year old, you don't even know yet what Islam is, you just know that it's
something which is the greatest horror in the universe.
The Punjabi businessman is a very distinct species. They have treated business
as warfare, and they are still doing it like that 70 years later and they are
very good at it. They enter the global economy at a time when it's becoming
much less civilized as well. In many cases they succeed not because they have
a good idea, but because they know how to seize global assets and resources.
Punjabi businessmen are not inventing Facebook. They are about mines and oil
and water and food -things that everyone understands and needs.
In this moment of globalization, the world will have to realize that events
like the Partition of India are not local history anymore but global history.
Especially in this moment when the West no longer controls the whole system,
these traumas explode onto the world and affect all of us, like the Holocaust.
They introduce levels of turbulence into businesses and practices that we didn't
expect necessarily.
Then there's the trauma of capitalism itself, and here I think it's important
for us to re-remember the West's own history. Capitalism achieved a level of
consensus in the second half of the 20th century very accidentally, and by a
number of enormous forces, not all of which were intended. There's no guarantee
that such consensus will be achieved everywhere in the emerging world. India
and China don't have an empire to ship people off to as a safety valve when
suffering become immense. They just have to absorb all that stuff.
For a century or so, people in power in Paris and London and Washington felt
that they had to save the capitalist system from socialist revolution, so they
gave enormous concessions to their populations. Very quickly, people in the
West forgot that there was that level of dissent. They thought that everyone
loved capitalism. I think as we come into the next period where the kind of
consensus has already been dealt a huge blow in the West, we're going to have
to deal with some of those forces again.
LP: When you say that the consensus on capitalism has been dealt
a blow, are you talking about the financial crisis?
RD: Yes, the sense that the nation-state - I'm talking about the U.S. context
- can no longer control global capital, global processes, or, indeed, it's own
financial elite.
It's a huge psychological dent in people's faith in the system. I think
what's going to happen in the next few years is huge unemployment in the middle
class in America because a lot of their jobs will be outsourced or automated.
Then, if you have 30-40 percent unemployment in America, which has always
been the ideological leader in capitalism, America will start to re-theorize
capitalism very profoundly (and maybe the Institute of New Economic Thinking
is part of that). Meanwhile, I think the middle class in India would not have
these kinds of problems. It's precisely because American technology and finance
are so advanced that they're going to hit a lot of those problems. I think in
places like India there's so much work to be done that no one needs to leap
to the next stage of making the middle class obsolete. They're still useful.
Lynn Parramore is contributing editor at AlterNet. She is cofounder of Recessionwire,
founding editor of New Deal 2.0, and author of "Reading the Sphinx: Ancient
Egypt in Nineteenth-Century Literary Culture." She received her Ph.D. in English
and cultural theory from NYU. Follow her on Twitter @LynnParramore.
This set of principles in the core of "Trump_vs_deep_state" probably can be
improved, but still are interesting: "... If you listen closely to Trump, you'll hear a direct repudiation of the
system of globalization and identity politics that has defined the world order since
the Cold War. There are, in fact, six specific ideas that he has either blurted
out or thinly buried in his rhetoric: (1) borders matter; (2) immigration policy
matters; (3) national interests, not so-called universal interests, matter; (4)
entrepreneurship matters; (5) decentralization matters; (6) PC speech-without which
identity politics is inconceivable-must be repudiated. ..."
Notable quotes:
"... If you listen closely to Trump, you'll hear a direct repudiation of the system of globalization and identity politics that has defined the world order since the Cold War. There are, in fact, six specific ideas that he has either blurted out or thinly buried in his rhetoric: (1) borders matter; (2) immigration policy matters; (3) national interests, not so-called universal interests, matter; (4) entrepreneurship matters; (5) decentralization matters; (6) PC speech-without which identity politics is inconceivable-must be repudiated. ..."
"... These six ideas together point to an end to the unstable experiment with supra- and sub-national sovereignty that many of our elites have guided us toward, siren-like, since 1989. ..."
"... if anti-Trumpers convince themselves that that's all ..."
"... What is going on is that "globalization-and-identity-politics-speak" is being boldly challenged. Inside the Beltway, along the Atlantic and Pacific coasts, there is scarcely any evidence of this challenge. There are people in those places who will vote for Trump, but they dare not say it, for fear of ostracism. ..."
"... Out beyond this hermetically sealed bicoastal consensus, there are Trump placards everywhere, not because citizens are racists or homophobes or some other vermin that needs to be eradicated, but because there is little evidence in their own lives that this vast post-1989 experiment with "globalization" and identity politics has done them much good. ..."
"... The most highly motivated voters in this election cycle seem to be insurgents pushing back against corrupt and incompetent elites and the Establishment. That does not bode well for Clinton. ..."
"... Another page in the annals of American elite incompetence, only five days after the ceasefire in Syria was negotiated, we broke it by bombing a well-known Syrian position. After Russia took us to the woodshed, Samantha Power responds by basically saying, "We messed up, but Russia is a moralistic hypocrite because they support Assad and he is, like, really bad and stuff." ..."
"... They seem to think that any attempt to stop mass 3rd world immigration, stop pc thought police, or up hold Christian-ish values are a direct threat to them. ..."
"... The enthusiasm for Bernie Sanders and Trump can only be understood as an overdue awakening of voters--finally recognizing that voting for more of the same tools of the plutocrats and oligarchs (which was represented by all candidates other than Trump and Sanders) will only serve the war profiteers, neocons, and other beltway bandits--at the expense of every other voter. ..."
"... Once the voters have awakened, they will not return to slumber or accept the establishment politics as usual. It is going to be a very interesting process to watch, and the political operatives who think we will return to the same old GOP and Democratic politics as usual should brace themselves for a rude awakening. ..."
"... Trump vs. Clinton = Nationalism vs. Globalism ..."
If you listen closely to Trump, you'll hear a direct repudiation
of the system of globalization and identity politics that has defined the
world order since the Cold War. There are, in fact, six specific ideas that
he has either blurted out or thinly buried in his rhetoric: (1) borders
matter; (2) immigration policy matters; (3) national interests, not so-called
universal interests, matter; (4) entrepreneurship matters; (5) decentralization
matters; (6) PC speech-without which identity politics is inconceivable-must
be repudiated.
These six ideas together point to an end to the unstable experiment
with supra- and sub-national sovereignty that many of our elites have guided
us toward, siren-like, since 1989.
That is what the Trump campaign, ghastly though it may at times be, leads
us toward: A future where states matter. A future where people are citizens,
working together toward (bourgeois) improvement of their lot. His ideas
do not yet fully cohere. They are a bit too much like mental dust that has
yet to come together. But they can come together. And Trump is the first
American candidate to bring some coherence to them, however raucous his
formulations have been.
Mitchell goes on to say that political elites call Trump "unprincipled,"
and perhaps they're right: that he only does what's good for Trump. On the other
hand, maybe Trump's principles are not ideological, but pragmatic. That is,
Trump might be a quintessential American political type: the leader who gets
into a situation and figures out how to muddle through. Or, as Mitchell puts
it:
This doesn't necessarily mean that he is unprincipled; it means rather
that he doesn't believe that yet another policy paper based on conservative
"principles" is going to save either America or the Republican Party.
Also, Mitchell says that there are no doubt voters in the Trump coalition
who are nothing but angry, provincial bigots. But if anti-Trumpers convince
themselves that that's all the Trump voters are, they will miss something
profoundly important about how Western politics are changing because of deep
instincts emerging from within the body politic:
What is going on is that "globalization-and-identity-politics-speak"
is being boldly challenged. Inside the Beltway, along the Atlantic
and Pacific coasts, there is scarcely any evidence of this challenge. There
are people in those places who will vote for Trump, but they dare not say
it, for fear of ostracism.
They think that identity politics has gone too
far, or that if it hasn't yet gone too far, there is no principled place
where it must stop. They believe that the state can't be our only large-scale
political unit, but they see that on the post-1989 model, there will, finally,
be no place for the state.
Out beyond this hermetically sealed bicoastal consensus, there are Trump
placards everywhere, not because citizens are racists or homophobes or some
other vermin that needs to be eradicated, but because there is little evidence
in their own lives that this vast post-1989 experiment with "globalization"
and identity politics has done them much good.
There's lots more here, including his prediction of what's going to happen
to the GOP.
Read the whole thing.
The most highly motivated voters in this election cycle seem to be
insurgents pushing back against corrupt and incompetent elites and the
Establishment. That does not bode well for Clinton.
Another page in the annals of American elite incompetence, only five
days after the ceasefire in Syria was negotiated, we broke it by
bombing a well-known Syrian position. After Russia took us to the woodshed,
Samantha Power responds by basically saying, "We messed up, but Russia is
a moralistic hypocrite because they support Assad and he is, like, really
bad and stuff."
Which not only makes it seem more likely that we were targeting
Assad's forces to anyone reasonably distrustful of American involvement
in the war, but also shows the moral reasoning ability of nothing greater
than a 6 year old.
Seriously, accusing Russia of moralism, and then moralistically trying
to hide responsibility by listing atrocities committed by Assad? It is self-parody.
Call it anti-Semitic if you want but all my Jewish cousins and the several
other Jewish business associates I know feel uncontrollable hate for Trump.
"thinly buried in his rhetoric:
borders matter;
immigration policy matters;
national interests, not so-called universal interests, matter;
entrepreneurship matters;
decentralization matters;
PC speech-without which identity politics is inconceivable-must
be repudiated."
They seem to think that any attempt to stop mass 3rd world immigration,
stop pc thought police, or up hold Christian-ish values are a direct threat
to them.
I cannot speak to what is best for conservative Christians, but change is
definitely in the air. Since the start of this election, I have had a clear
sense that we are seeing a beginning of a new political reality.
The enthusiasm for Bernie Sanders and Trump can only be understood
as an overdue awakening of voters--finally recognizing that voting for more
of the same tools of the plutocrats and oligarchs (which was represented
by all candidates other than Trump and Sanders) will only serve the war
profiteers, neocons, and other beltway bandits--at the expense of every
other voter.
Too many voters have finally come to recognize that neither party serves
them in any real way. This will forcibly result in a serious reform process
of one or both parties, a third party that actually represents working people,
or if neither reform or a new party is viable-–a new American revolution,
which I fear greatly.
Once the voters have awakened, they will not return to slumber or
accept the establishment politics as usual. It is going to be a very interesting
process to watch, and the political operatives who think we will return
to the same old GOP and Democratic politics as usual should brace themselves
for a rude awakening.
I'm certainly not
the first to say this, but perhaps the first to post it on this blog. RD,
perhaps rightfully, has steered this post toward the Benedict Option, but
what should be debated is the repudiation of globalization and identity
politics.
"Laws have to be backed up with resources and political will and
deep-seated cultural codes, religious beliefs and structural biases
have to be changed."
Uh Oh -- We Christians are in Hillary Clinton's Basket of Deplorables.
"... Moscow did indeed support secessionist pro-Russia rebels in East Ukraine. But did not the U.S. launch a 78-day bombing campaign on tiny Serbia to effect a secession of its cradle province of Kosovo? ..."
"... Russia is reportedly hacking into our political institutions. If so, it ought to stop. But have not our own CIA, National Endowment for Democracy, and NGOs meddled in Russia's internal affairs for years? ..."
"... Scores of the world's 190-odd nations are today ruled by autocrats. How does it advance our interests or diplomacy to have congressional leaders yapping "thug" at the ruler of a nation with hundreds of nuclear warheads? ..."
"... Very good article indeed. Knee-jerk reaction of american politicians and journalists looks extremely strange. As a matter of fact they look like idiots or puppets. ..."
"... Rubio and Graham are reflexively ready to push US influence everywhere, all the time, with military force always on the agenda, and McCain seems to be in a state of constant agitation ..."
"... Very sensible article. And as the EU falls further into disarray and possible disintegration, due to migration and other catastrophically mishandled problems, a working partnership with Russia will become even more important. Right now, we treat Russia as an enemy and Saudi Arabia as a friend. That makes no sense at all. ..."
"... As I've stated many times, Obama the narcissist hates Putin because Putin doesn't play the sycophantic lapdog yapping about how good it is to interact with the "smartest person in the room". ..."
"... I'm serious. Obama craves sources of narcissistic supply and has visceral contempt for sources of narcissistic injury. I.e., people who may reveal the mediocrity that he actually is. Obama considers Putin a threat in that context. ..."
"... The downside for the U.S. is that Obama has extended hating Putin to hating Russia. And yes, Washington is flooded with sources of sycophantic narcissistic supply for Obama including the MSM. And they are happy to massage his twisted ego by enthusiastically playing along with the Putin/Russia fear-monger bashing. ..."
"... P.S. too bad Hillary is saturated with her own psychopathology that portends more Global Cop wreckage. ..."
"... Anyway, what Buchanan is saying is, "We have to deal with him," not "favor him." The two terms should not be confused. ..."
"... There are a lot of "allies" of questionable usefulness that the US should stop "favoring," and a lot of competitors (and potential allies in the true sense) out there the US should begin "dealing" with. ..."
"... Everything the Western elite does is about dollar hegemony and control of energy. ..."
"... As long as Russia is not a puppet of the globalist banking cartel they will be presented as an "enemy". Standing in the way of energy imperialism was the last straw for the all out hybrid war being launched on Russia now. ..."
"... If the Western public wasn't so lazy and stupid we would remove the globalists controlling us. Instead people, especially liberals, get in bed with the globalists plans against Russia bc they can't stand Russia is Christian and supports the family. ..."
"... Every word about Russia allowed in the Western establishment are lies funded and molded by people like Soros and warmongers. This is the reality. Nobody who will speak honestly or positively about Russia is allowed any voice. And scumbag neoliberal globalists like Kasperov are presented as "Russians" while real Russian people are given zero voice. ..."
"... What the Western elite is doing right now in Ukraine and Syria is reprehensible and its all our fault for letting these people control us. ..."
...Arriving on Capitol Hill to repair ties between Trump and party elites,
Gov. Mike Pence was taken straight to the woodshed.
John McCain told Pence that Putin was a "thug and a butcher," and Trump's
embrace of him intolerable.
Said Lindsey Graham: "Vladimir Putin is a thug, a dictator … who has
his opposition killed in the streets," and Trump's views bring to mind Munich.
Putin is an "authoritarian thug," added "Little Marco" Rubio.
What causes the Republican Party to lose it whenever the name of Vladimir
Putin is raised?
Putin is no Stalin, whom FDR and Harry Truman called "Good old Joe" and "Uncle
Joe." Unlike Nikita Khrushchev, he never drowned a Hungarian Revolution in blood.
He did crush the Chechen secession. But what did he do there that General Sherman
did not do to Atlanta when Georgia seceded from Mr. Lincoln's Union?
Putin supported the U.S. in Afghanistan, backed our nuclear deal with Iran,
and signed on to John Kerry's plan have us ensure a cease fire in Syria and
go hunting together for ISIS and al-Qaida terrorists.
Still, Putin committed "aggression" in Ukraine, we are told. But was that
really aggression, or reflexive strategic reaction? We helped dump over a pro-Putin
democratically elected regime in Kiev, and Putin acted to secure his Black Sea
naval base by re-annexing Crimea, a peninsula that has belonged to Russia from
Catherine the Great to Khrushchev. Great powers do such things.
When the Castros pulled Cuba out of America's orbit, we decided to keep Guantanamo,
and dismiss Havana's protests?
Moscow did indeed support secessionist pro-Russia rebels in East Ukraine.
But did not the U.S. launch a 78-day bombing campaign on tiny Serbia to effect
a secession of its cradle province of Kosovo?
... ... ...
Russia is reportedly hacking into our political institutions. If so,
it ought to stop. But have not our own CIA, National Endowment for Democracy,
and NGOs meddled in Russia's internal affairs for years?
... ... ...
Is Putin's Russia more repressive than Xi Jinping's China? Yet, Republicans
rarely use "thug" when speaking about Xi. During the Cold War, we partnered
with such autocrats as the Shah of Iran and General Pinochet of Chile, Ferdinand
Marcos in Manila, and Park Chung-Hee of South Korea. Cold War necessity required
it.
Scores of the world's 190-odd nations are today ruled by autocrats. How
does it advance our interests or diplomacy to have congressional leaders yapping
"thug" at the ruler of a nation with hundreds of nuclear warheads?
>>During the Cold War, we partnered with such autocrats as the Shah
of Iran and General Pinochet of Chile, Ferdinand Marcos in Manila, and Park
Chung-Hee of South Korea
buttressed could be even more pertinent)
Very good article indeed. Knee-jerk reaction of american politicians
and journalists looks extremely strange. As a matter of fact they look like
idiots or puppets.
Rubio
and Graham are reflexively ready to push US influence everywhere, all the
time, with military force always on the agenda, and McCain seems to be in
a state of constant agitation whenever US forces are not actively engaged
in combat somewhere. They are loud voices, yes, but irrational voices, too.
Very sensible article. And as the EU falls further into disarray
and possible disintegration, due to migration and other catastrophically
mishandled problems, a working partnership with Russia will become even
more important. Right now, we treat Russia as an enemy and Saudi Arabia
as a friend. That makes no sense at all.
"Just" states the starvation of the Ukraine is a western lie. The Harvest
of Sorrow by Robert Conquest refutes this dangerous falsehood. Perhaps "Just"
believes The Great Leap Forward did not lead to starvation of tens of millions
in China. After all, this could be another "western lie". So to could be
the Armenian genocide in Turkey or slaughter of Communists in Indonesia.
As I've stated many times, Obama the narcissist hates Putin because
Putin doesn't play the sycophantic lapdog yapping about how good it is to
interact with the "smartest person in the room".
I'm serious. Obama craves sources of narcissistic supply and has
visceral contempt for sources of narcissistic injury. I.e., people who may
reveal the mediocrity that he actually is. Obama considers Putin a threat
in that context.
The downside for the U.S. is that Obama has extended hating Putin
to hating Russia. And yes, Washington is flooded with sources of sycophantic
narcissistic supply for Obama including the MSM. And they are happy to massage
his twisted ego by enthusiastically playing along with the Putin/Russia
fear-monger bashing.
And so the U.S. – Russia relationship is wrecked by the "smartest person
in the room".
P.S. too bad Hillary is saturated with her own psychopathology that
portends more Global Cop wreckage.
John asks, "We also have to deal with our current allies. Whom would
Mr. Buchanan like to favor?"
Well, we could redouble our commitment to our democracy and peace loving
friends in Saudi Arabia, we could deepen our ties to those gentle folk in
Egypt, and maybe for a change give some meaningful support to Israel. Oh,
and our defensive alliances will be becoming so much stronger with Montenegro
as a member, we will need to pour more resources into that country.
Anyway, what Buchanan is saying is, "We have to deal with him," not
"favor him." The two terms should not be confused.
There are a lot of "allies" of questionable usefulness that the US
should stop "favoring," and a lot of competitors (and potential allies in
the true sense) out there the US should begin "dealing" with.
"During the Cold War, we partnered with such autocrats as the Shah of
Iran and General Pinochet of Chile, Ferdinand Marcos in Manila, and Park
Chung-Hee of South Korea. Cold War necessity required it (funny, you failed
to mention Laos, South Vietnam, Nicaragua, Noriega/Panama, and everyone's
favorite 9/11 co-conspirator and WMD developer, Saddam Hussein). either
way how did these "alliances" work out for the US? really doesn't matter,
does it? it is early 21st century, not mid 20th century. there is a school
of thought in the worlds of counter-terrorism/intelligence operations, which
suggests if you want to be successful, you have to partner with some pretty
nasty folks. Trump is being "handled" by an experienced, ruthless (that's
a compliment), and focused "operator". unless, of course, Trump is actually
the superior operator, in which case, this would be the greatest black op
of all time.
"From Russia With Money - Hillary Clinton, the Russian Reset and Cronyism,"
"Of the 28 US, European and Russian companies that participated in Skolkovo,
17 of them were Clinton Foundation donors" or sponsored speeches by former
President Bill Clinton, Schweizer told The Post.
Everything the Western elite does is about dollar hegemony and control
of energy. Once you understand that then the (evil)actions of the Western
elite make sense. Anyone who stands in the way of those things is an "enemy".
This is how they determine an "enemy".
As long as Russia is not a puppet of the globalist banking cartel
they will be presented as an "enemy". Standing in the way of energy imperialism
was the last straw for the all out hybrid war being launched on Russia now.
If the Western public wasn't so lazy and stupid we would remove the
globalists controlling us. Instead people, especially liberals, get in bed
with the globalists plans against Russia bc they can't stand Russia is Christian
and supports the family.
Every word about Russia allowed in the Western establishment are
lies funded and molded by people like Soros and warmongers. This is the
reality. Nobody who will speak honestly or positively about Russia is allowed
any voice. And scumbag neoliberal globalists like Kasperov are presented
as "Russians" while real Russian people are given zero voice.
What the Western elite is doing right now in Ukraine and Syria is
reprehensible and its all our fault for letting these people control us.
You need to substitute PIC (a.k.a., The Elites or Political Class)) for
neoliberal elite for the article to make more sense.
Notable quotes:
"... Our nation is in the grip of such poisonous thinking. The DNC with its "Super Delegates" already has a way to control who will be their candidate. In an irony to beat all ironies, the DNC's Super Delegates were able to stop Bernie Sanders... ..."
"... The reason Trump is still rising (and I believe will win handily) is he clearly represents the original image of America: a self made success story based on capitalism and the free market. ..."
This election cycle is so amazing one cannot help but think it has been scripted
by some invisible, all-powerful, hand. I mean, how could we have two completely
opposite candidates, perfectly reflecting the forces at play in this day and
age? It truly is a clash between The Elites and The Masses!
Main Street vs Wall & K Street.
The Political Industrial Complex (PIC – a.k.a., The Elites or Political Class)
is all up arms over the outsider barging in on their big con. The PIC is beside
itself trying to stop Donald Trump from gaining the Presidency, where he will
be able to clean out the People's House and the bureaucratic cesspool that has
shackled Main Street with political correctness, propaganda, impossibly expensive
health care, ridiculous taxes and a national debt that will take generations
to pay off.
The PIC has run amok long enough – illustrated perfectly by the defect ridden
democrat candidate: Hillary Clinton. I mean, how could you frame America's choices
this cycle
any better than this --
Back in July, Democratic presidential nominee and former Secretary of
State Hillary Clinton said, "there is
absolutely no connection between anything that I did as secretary of
state and the Clinton Foundation."
On Monday of this week,
ABC's Liz Kreutzer reminded people of that statement, as a new batch
of emails reveal that there was a connection, and
it was cash .
…
The Abedin emails reveal that the longtime Clinton aide apparently served
as a conduit between Clinton Foundation donors and Hillary Clinton while
Clinton served as secretary of state. In more than a dozen email exchanges,
Abedin provided expedited, direct access to Clinton for donors who had contributed
from $25,000 to $10 million to the Clinton Foundation. In many instances,
Clinton Foundation top executive Doug Band, who worked with the Foundation
throughout Hillary Clinton's tenure at State, coordinated closely with Abedin.
In Abedin's June deposition to Judicial Watch, she conceded that part of
her job at the State Department was taking care of "
Clinton family matters ."
This is what has Main Street so fed up with Wall & K street (big business,
big government). The Clinton foundation is a cash cow for Clinton, Inc. So while
our taxes go up, our debt sky rockets and our health care becomes too expensive
to afford, Clan Clinton has made 100's of millions of dollars selling access
(and obviously doing favors, because no one spends that kind of money without
results).
The PIC is circling the wagons with its news media arm shrilly screaming
anything and everything about Trump as if they could fool Main Street with their
worn out propaganda. I seriously doubt it will work. The Internet has broken
the information monopoly that allowed the PIC in the not too distant past to
control what people knew and thought.
Massachusetts has a long history of using the power of incumbency to
cripple political opponents. In fact, it's a leading state for such partisan
gamesmanship. Dating back to 1812, when Gov. Elbridge Gerry signed into
law a redistricting plan for state Senate districts that favored his Democratic-Republican
Party, the era of Massachusetts rule rigging began. It has continued, unabated,
ever since.
Given the insider dealing and venality that epitomized the 2016 presidential
primary process, I'd hoped that politicians would think twice before abusing
the power of the state for political purposes. Galvin quickly diminished
any such prospect of moderation in the sketchy behavior of elected officials.
He hid his actions behind the thin veil of fiscal responsibility. He claimed
to be troubled by the additional $56,000 he was going to have to spend printing
ballots to accommodate Independent voters. He conveniently ignored the fact
that thousands of these UIP members have been paying taxes for decades to
support a primary process that excludes them.
…
In my home state of Kansas, where my 2014 candidacy threatened to take
a U.S. Senate seat from the Republicans, they responded predictably. Instead
of becoming more responsive to voters, our state's highly partisan secretary
of state, Kris Kobach, introduced legislation that would bring back one
of the great excesses of machine politics: straight party-line voting –
which is designed to discourage voters from considering an Independent candidacy
altogether. Kobach's rationale, like Galvin's, was laughable. He described
it as a "convenience" for voters.
The article goes on to note these acts by the PIC are an affront to the large
swath of the electorate who really choose who will win elections:
In a recent Gallup poll, 60 percent of Americans said they do not feel
well-represented by the Democrats and Republicans and believe a third major
party is needed. Fully 42 percent of Americans now describe themselves
as politically independent .
That means the two main parties are each smaller in size than the independents
(68% divided by 2 equals 34%), which is why independents pick which side will
win. If the PIC attacks this group – guess what the response will look like?
I recently had a discussion with someone from Washington State who is pretty
much my opposite policy-wise. She is a deep blue democrat voter, whereas I am
a deep purple independent who is more small-government Tea Party than conservative-GOP.
She was lamenting the fact that her state has caucuses, which is one method
to blunt Main Street voters from having a say. It was interesting that we quickly
and strongly agreed on one thing above all else: open primaries. We both knew
that if the voters had the only say in who are leaders
would be, all sides could abide that decision easily. It is when PIC intervenes
that things get ugly.
Open primaries make the political parties accountable to the voters. Open
primaries make it harder for the PIC to control who gets into office, and reduces
the leverage of big donors. Open primaries reflect the will of the states and
the nation – not the vested interests (read bank accounts) of the PIC.
Without doubt, one of the most troublesome aspects of the current system
is its gross inefficiency. Whereas generations ago selecting a nominee
took relatively little time and money , today's process has resulted
in a near-permanent campaign. Because would-be nominees have to
win primaries and open caucuses in several states, they must put
together vast campaign apparatuses that spread across the nation, beginning
years in advance and raising tens of millions of dollars.
The length of the campaign alone keeps many potential candidates on the
sidelines. In particular, those in positions of leadership at various
levels of our government cannot easily put aside their duties and
shift into full-time campaign mode for such an extended period.
It is amazing how this kind of thinking can be considered legitimate. Note
how independent voters are evil in the mind of the PIC, and only government
leaders need apply. Not surprising, their answer is to control access to the
ballot:
During the week of Lincoln's birthday (February 12), the Republican Party
would hold a Republican Nomination Convention that would borrow from the
process by which the Constitution was ratified. Delegates to the
convention would be selected by rank-and-file Republicans in their local
communities , and those chosen delegates would meet, deliberate,
and ultimately nominate five people who, if willing, would each
be named as one of the party's officially sanctioned finalists for its presidential
nomination. Those five would subsequently debate one another a half-dozen
times.
Brexit became a political force because the European Union was not accountable
to the voters. The EU members are also selected by members of the European PIC
– not citizens of the EU. Without direct accountability to all citizens (a.k.a.
– voters) there is no democracy –
just a variant
of communism:
During the Russian Civil War (1918–1922), the Bolsheviks nationalized
all productive property and imposed a policy named war communism,
which put factories and railroads under strict government control,
collected and rationed food, and introduced some bourgeois management of
industry . After three years of war and the 1921 Kronstadt rebellion,
Lenin declared the New Economic Policy (NEP) in 1921, which was to give
a "limited place for a limited time to capitalism." The NEP lasted until
1928, when Joseph Stalin achieved party leadership, and the introduction
of the Five Year Plans spelled the end of it. Following the Russian Civil
War, the Bolsheviks, in 1922, formed the Union of Soviet Socialist Republics
(USSR), or Soviet Union, from the former Russian Empire.
Following Lenin's democratic centralism, the Leninist parties
were organized on a hierarchical basis, with active cells of members as
the broad base; they were made up only of elite cadres approved by higher
members of the party as being reliable and completely subject to party discipline
.
Emphasis mine. Note how communism begins with government control of major
industries. The current con job about Global Warming is the cover-excuse for
a government grab of the energy sector. Obamacare is an attempt to grab the
healthcare sector. And Wall Street already controls the banking sector. See
a trend yet?
This is then followed by imposing a rigid hierarchy of "leaders" at all levels
of politics – so no opposing views can gain traction. Party discipline uber
alles!
Our nation is in the grip of such poisonous thinking. The DNC with its "Super
Delegates" already has a way to control who will be their candidate. In an irony
to beat all ironies, the DNC's Super Delegates were able to stop Bernie Sanders...
The reason Trump is still rising (and I believe will win handily) is he clearly
represents the original image of America: a self made success story based on
capitalism and the free market.
His opponent is the epitome of the Political Industrial Complex – a cancer
that has eaten away America's free market foundation and core strength. A person
who wants to impose government on the individual.
"... Reality always has this power to surprise. It surprises you with an answer that it gives to questions never asked - and which are most tempting. A great stimulus to life is there, in the capacity to divine possible unasked questions. ..."
"... - Eduardo Galeano ..."
"... Fred Jameson has argued that "that it is easier to imagine the end of the world than to imagine the end of capitalism." ..."
"... One way of understanding Jameson's comment is that within the ideological and affective spaces in which the neoliberal subject is produced and market-driven ideologies are normalized, there are new waves of resistance, especially among young people, who are insisting that casino capitalism is driven by a kind of mad violence and form of self-sabotage, and that if it does not come to an end, what we will experience, in all probability, is the destruction of human life and the planet itself. ..."
"... As the latest stage of predatory capitalism, neoliberalism is part of a broader economic and political project of restoring class power and consolidating the rapid concentration of capital, particularly financial capital ..."
"... As an ideology, it casts all dimensions of life in terms of market rationality, construes profit-making as the arbiter and essence of democracy ..."
"... Neoliberalism has put an enormous effort into creating a commanding cultural apparatus and public pedagogy in which individuals can only view themselves as consumers, embrace freedom as the right to participate in the market, and supplant issues of social responsibility for an unchecked embrace of individualism and the belief that all social relation be judged according to how they further one's individual needs and self-interests. ..."
"... The unemployment rate for young people in many countries such as Spain, Italy, Portugal, and Greece hovers between 40 and 50 per cent. To make matters worse, those with college degrees either cannot find work or are working at low-skill jobs that pay paltry wages. In the United States, young adjunct faculty constitute one of the fastest growing populations on food stamps. Suffering under huge debts, a jobs crisis, state violence, a growing surveillance state, and the prospect that they would inherit a standard of living far below that enjoyed by their parents, many young people have exhibited a rage that seems to deepen their resignation, despair, and withdrawal from the political arena. ..."
"... They now inhabit a neoliberal notion of temporality marked by a loss of faith in progress along with the emergence of apocalyptic narratives in which the future appears indeterminate, bleak, and insecure. Heightened expectations and progressive visions pale and are smashed next to the normalization of market-driven government policies that wipe out pensions, eliminate quality health care, raise college tuition, and produce a harsh world of joblessness, while giving millions to banks and the military. ..."
"... dispossessed youth continued to lose their dignity, bodies, and material goods to the machineries of disposability. ..."
"... Against the ravaging policies of austerity and disposability, "zones of abandonment appeared in which the domestic machinery of violence, suffering, cruelty, and punishment replaced the values of compassion, social responsibility, and civic courage" (Biehl 2005:2). ..."
"... In opposition to such conditions, a belief in the power of collective resistance and politics emerged once again in 2010, as global youth protests embraced the possibility of deepening and expanding democracy, rather than rejecting it. ..."
"... What is lacking here is any critical sense regarding the historical conditions and dismal lack of political and moral responsibility of an adult generation who shamefully bought into and reproduced, at least since the 1970s, governments and social orders wedded to war, greed, political corruption, xenophobia, and willing acceptance of the dictates of a ruthless form of neoliberal globalization. ..."
"... London Review of Books ..."
"... This is not a diary ..."
"... Vita: Life in a Zone of Social Abandonment ..."
"... Against the terror of neoliberalism ..."
"... Against the violence of organized forgetting: beyond America's disimagination machine ..."
"... Debt: The First 5,000 Years ..."
"... The democracy project: a history, a crisis, a movement ..."
"... 5th assessment report by the intergovernmental panel on climate change ..."
"... Unlearning With Hannah Arendt ..."
"... Agnonistics: thinking the world politically ..."
Reality always has this power to surprise. It surprises you with
an answer that it gives to questions never asked - and which are most tempting.
A great stimulus to life is there, in the capacity to divine possible unasked
questions.
- Eduardo Galeano
Neoliberalism's Assault on Democracy
Fred Jameson has argued that "that it is easier to imagine the end of
the world than to imagine the end of capitalism." He goes on to say that
"We can now revise that and witness the attempt to imagine capitalism by way
of imagining the end of the world" (Jameson 2003). One way of understanding
Jameson's comment is that within the ideological and affective spaces in which
the neoliberal subject is produced and market-driven ideologies are normalized,
there are new waves of resistance, especially among young people, who are insisting
that casino capitalism is driven by a kind of mad violence and form of self-sabotage,
and that if it does not come to an end, what we will experience, in all probability,
is the destruction of human life and the planet itself. Certainly, more
recent scientific reports on the threat of ecological disaster from researchers
at the University of Washington, NASA, and the Intergovernmental Panel on Climate
Change reinforce this dystopian possibility. [1]
To read more articles by Henry A. Giroux and other authors in the
Public Intellectual Project, click
here.
As the latest stage of predatory capitalism, neoliberalism is part of
a broader economic and political project of restoring class power and consolidating
the rapid concentration of capital, particularly financial capital (Giroux
2008; 2014). As a political project, it includes "the deregulation of finance,
privatization of public services, elimination and curtailment of social welfare
programs, open attacks on unions, and routine violations of labor laws" (Yates
2013). As an ideology, it casts all dimensions of life in terms of market
rationality, construes profit-making as the arbiter and essence of democracy,
consuming as the only operable form of citizenship, and upholds the irrational
belief that the market can both solve all problems and serve as a model for
structuring all social relations. As a mode of governance, it produces identities,
subjects, and ways of life driven by a survival-of-the fittest ethic, grounded
in the idea of the free, possessive individual, and committed to the right of
ruling groups and institutions to exercise power removed from matters of ethics
and social costs. As a policy and political project, it is wedded to the privatization
of public services, the dismantling of the connection of private issues and
public problems, the selling off of state functions, liberalization of trade
in goods and capital investment, the eradication of government regulation of
financial institutions and corporations, the destruction of the welfare state
and unions, and the endless marketization and commodification of society.
Neoliberalism has put an enormous effort into creating a commanding cultural
apparatus and public pedagogy in which individuals can only view themselves
as consumers, embrace freedom as the right to participate in the market, and
supplant issues of social responsibility for an unchecked embrace of individualism
and the belief that all social relation be judged according to how they further
one's individual needs and self-interests. Matters of mutual caring, respect,
and compassion for the other have given way to the limiting orbits of privatization
and unrestrained self-interest, just as it has become increasingly difficult
to translate private troubles into larger social, economic, and political considerations.
As the democratic public spheres of civil society have atrophied under the onslaught
of neoliberal regimes of austerity, the social contract has been either greatly
weakened or replaced by savage forms of casino capitalism, a culture of fear,
and the increasing use of state violence. One consequence is that it has become
more difficult for people to debate and question neoliberal hegemony and the
widespread misery it produces for young people, the poor, middle class, workers,
and other segments of society - now considered disposable under neoliberal regimes
which are governed by a survival-of-the fittest ethos, largely imposed by the
ruling economic and political elite.
That they are unable to make their voices
heard and lack any viable representation in the process makes clear the degree
to which young people and others are suffering under a democratic deficit, producing
what Chantal Mouffe calls "a profound dissatisfaction with a number of existing
societies" under the reign of neoliberal capitalism (Mouffe 2013:119). This
is one reason why so many youth, along with workers, the unemployed, and students,
have been taking to the streets in Greece, Mexico, Egypt, the United States,
and England.
The Rise of Disposable Youth
What is particularly distinctive about the current historical conjuncture
is the way in which young people, particularly low-income and poor minority
youth across the globe, have been increasingly denied any place in an already
weakened social order and the degree to which they are no longer seen as central
to how a number of countries across the globe define their future. The plight
of youth as disposable populations is evident in the fact that millions of them
in countries such as England, Greece, and the United States have been unemployed
and denied long term benefits. The unemployment rate for young people in many
countries such as Spain, Italy, Portugal, and Greece hovers between 40 and 50
per cent. To make matters worse, those with college degrees either cannot find
work or are working at low-skill jobs that pay paltry wages. In the United States,
young adjunct faculty constitute one of the fastest growing populations on food
stamps. Suffering under huge debts, a jobs crisis, state violence, a growing
surveillance state, and the prospect that they would inherit a standard of living
far below that enjoyed by their parents, many young people have exhibited a
rage that seems to deepen their resignation, despair, and withdrawal from the
political arena.
This is the first generation, as sociologist Zygmunt Bauman argues, in which
the "plight of the outcast may stretch to embrace a whole generation." (Bauman
2012a; 2012b; 2012c) He rightly insists that today's youth have been "cast in
a condition of liminal drift, with no way of knowing whether it is transitory
or permanent" (Bauman 2004:76). Youth no longer occupy the hope of a privileged
place that was offered to previous generations. They now inhabit a neoliberal
notion of temporality marked by a loss of faith in progress along with the emergence
of apocalyptic narratives in which the future appears indeterminate, bleak,
and insecure. Heightened expectations and progressive visions pale and are smashed
next to the normalization of market-driven government policies that wipe out
pensions, eliminate quality health care, raise college tuition, and produce
a harsh world of joblessness, while giving millions to banks and the military.
Students, in particular, found themselves in a world in which unrealized aspirations
have been replaced by dashed hopes and a world of onerous debt (Fraser 2013;
On the history of debt, see Graeber 2012).
The Revival of the Radical Imagination
Within the various regimes of neoliberalism that have emerged particularly
in North since the late 1970s, the ethical grammars that drew attention to the
violence and suffering withered or, as in the United States, seemed to disappear
altogether, while dispossessed youth continued to lose their dignity, bodies,
and material goods to the machineries of disposability. The fear of losing everything,
the horror of an engulfing and crippling precarity, the quest to merely survive,
the rise of the punishing state and police violence, along with the impending
reality of social and civil death, became a way of life for the 99 percent in
the United States and other countries. Under such circumstances, youth were
no longer the place where society reveals its dreams, but increasingly hid its
nightmares. Against the ravaging policies of austerity and disposability, "zones
of abandonment appeared in which the domestic machinery of violence, suffering,
cruelty, and punishment replaced the values of compassion, social responsibility,
and civic courage" (Biehl 2005:2).
In opposition to such conditions, a belief in the power of collective resistance
and politics emerged once again in 2010, as global youth protests embraced the
possibility of deepening and expanding democracy, rather than rejecting it.
Such movements produced a new understanding of politics based on horizontal
forms of collaboration and political participation. In doing so, they resurrected
revitalized and much needed questions about class power, inequality, financial
corruption, and the shredding of the democratic process. They also explored
as well as what it meant to create new communities of mutual support, democratic
modes of exchange and governance, and public spheres in which critical dialogue
and exchanges could take place (For an excellent analysis on neoliberal-induced
financial corruption, see Anderson 2004).
A wave of youth protests starting in 2010 in Tunisia, and spreading across
the globe to the United States and Europe, eventually posed a direct challenge
to neoliberal modes of domination and the corruption of politics, if not democracy
itself (Hardt & Negri 2012). The legitimating, debilitating, and depoliticizing
notion that politics could only be challenged within established methods of
reform and existing relations of power was rejected outright by students and
other young people across the globe. For a couple of years, young people transformed
basic assumptions about what politics is and how the radical imagination could
be mobilized to challenge the basic beliefs of neoliberalism and other modes
of authoritarianism. They also challenged dominant discourses ranging from deficit
reduction and taxing the poor to important issues that included poverty, joblessness,
the growing unmanageable levels of student debt, and the massive spread of corporate
corruption. As Jonathan Schell argued, youth across the globe were enormously
successfully in unleashing "a new spirit of action", an expression of outrage
fueled less by policy demands than by a cry of collective moral and political
indignation whose message was
'Enough!' to a corrupt political, economic and media establishment that
hijacked the world's wealth for itself… sabotaging the rule of law, waging
interminable savage and futile wars, plundering the world's finite resources,
and lying about all this to the public [while] threatening Earth's life
forms into the bargain. (Schell 2011)
Yet, some theorists have recently argued that little has changed since 2011,
in spite of this expression of collective rage and accompanying demonstrations
by youth groups across the globe.
The Collapse or Reconfiguration of Youthful Protests?
Costas Lapavitsas and Alex Politaki,
writing in The Guardian, argue that as the "economic and social
disaster unfolded in 2012 and 2013", youth in Greece, France, Portugal, and
Spain have largely been absent from "politics, social movements and even from
the spontaneous social networks that have dealt with the worst of the catastrophe"
(Lapavitsas & Politaki 2014). Yet, at the same time, they insist that more and
more young people have been "attracted to nihilistic ends of the political spectrum,
including varieties of anarchism and fascism" (Lapavitsas & Politaki 2014).
This indicates that young people have hardly been absent from politics. On the
contrary, those youth moving to the right are being mobilized around needs that
simply promise the swindle of fulfillment. This does not suggest youth are becoming
invisible. On the contrary, the move on the part of students and others to the
right implies that the economic crisis has not been matched by a crisis of ideas,
one that would propel young people towards left political parties or social
formations that effectively articulate a critical understanding of the present
economic and political crisis. Missing here is also a strategy to create
and sustain a radical democratic political movement that avoids cooptation of
the prevailing economic and political systems of oppression now dominating the
United States, Greece, Turkey, Portugal, France, and England, among other countries.
This critique of youthful protesters as a suspect generation is repeated
in greater detail by Andrew R. Myers in Student Pulse (Myers 2012).
He argues that deteriorating economic and educational conditions for youth all
over Europe have created not only a profound sense of political pessimism among
young people, but also a dangerous, if not cynical, distrust towards established
politics. Regrettably, Myers seems less concerned about the conditions that
have written young people out of jobs, a decent education, imposed a massive
debt on them, and offers up a future of despair and dashed hopes than the alleged
unfortunate willingness of young people to turn their back on traditional parties.
Myers argues rightly that globalization is the enemy of young people and is
undermining democracy, but he wrongly insists that traditional social democratic
parties are the only vehicles and hope left for real reform. As such, Myers
argues that youth who exhibit distrust towards established governments and call
for the construction of another world symbolize political defeat, if not cynicism
itself. Unfortunately, with his lament about how little youth are protesting
today and about their lack of engagement in the traditional forms of politics,
he endorses, in the end, a defense of those left/liberal parties that embrace
social democracy and the new labor policies of centrist-left coalitions. His
rebuke borders on bad faith, given his criticism of young people for not engaging
in electoral politics and joining with unions, both of which, for many youth,
rightfully represent elements of a reformist politics they reject.
It is ironic that both of these critiques of the alleged passivity of youth
and the failure of their politics have nothing to say about the generations
of adults that failed these young people - that is, what disappears in these
narratives is the fact that an older generation accepted the "realization that
one generation no longer holds out a hand to the next" (Knott 2011:ix). What
is lacking here is any critical sense regarding the historical conditions and
dismal lack of political and moral responsibility of an adult generation who
shamefully bought into and reproduced, at least since the 1970s, governments
and social orders wedded to war, greed, political corruption, xenophobia, and
willing acceptance of the dictates of a ruthless form of neoliberal globalization.
In fact, what was distinctive about the protesting youth across the globe
was their rejection to the injustices of neoliberalism and their attempts to
redefine the meaning of politics and democracy, while fashioning new forms of
revolt (Hardt & Negri 2012; Graeber 2013). Among their many criticisms, youthful
protesters argued vehemently that traditional social democratic, left, and liberal
parties suffered from an "extremism of the center" that made them complicitous
with the corporate and ruling political elites, resulting in their embrace of
the inequities of a form of casino capitalism which assumed that the market
should govern the entirety of social life, not just the economic realm (Hardt
& Negri 2012:88).
Henry A.
Giroux currently holds the McMaster University Chair for Scholarship
in the Public Interest in the English and Cultural Studies Department and a
Distinguished Visiting Professorship at Ryerson University. His most recent
books include: Youth in Revolt: Reclaiming a Democratic Future (Paradigm 2013),
America's Educational Deficit and the War on Youth (Monthly Review Press, 2013)
Neoliberalism's War on Higher Education (Haymarket Press, 2014), and The Violence
of Organized Forgetting: Thinking Beyond America's Disimagination Machine (City
Lights, 2014). The Toronto Star named Henry Giroux one of the twelve Canadians
changing the way we think! Giroux is also a member of Truthout's Board of Directors.
His web site is www.henryagiroux.com.
"... The "Benedict Option" refers to Christians in the contemporary West who cease to identify the continuation of civility and moral community with the maintenance of American empire, ..."
"... Benedict wrote his famous Rule , which became the guiding constitution of most monasteries in western Europe in the Middle Ages. The monasteries were incubators of Christian and classical culture, and outposts of evangelization in the barbarian kingdoms ..."
The "Benedict Option" refers to Christians in the contemporary West who
cease to identify the continuation of civility and moral community with the
maintenance of American empire,and who therefore are keen to construct
local forms of community as loci of Christian resistance against what the empire
represents.
Put less grandly, the Benedict Option - or "Ben Op" - is an umbrella term
for Christians who accept MacIntyre's critique of modernity, and who also recognize
that forming Christians who live out Christianity according to Great Tradition
requires embedding within communities and institutions dedicated to that formation.
... ... ...
For one, the it awakened many small-o orthodox Christians to something that
ought to have been clear to them a long, long time ago: the West is truly a
post-Christian civilization, and we had better come up with new ways of living
if we are going to hold on to the faith in this new dark age. The reason gay
rights were so quickly embraced by the American public is because the same public
had already jettisoned traditional Christian teaching on the meaning of sex,
of marriage, and even a Christian anthropology. Same-sex marriage is only the
fulfillment of a radical change that had already taken place in Western culture.
... ... ...
Benedict of Nursia (ca. 480-537) was an educated young Christian who left
Rome, the city of the recently fallen Empire, out of disgust with its decadence.
He went south, into the forest near Subiaco, to live as a hermit and to pray.
Eventually, he gathered around him some like-minded men, and formed monasteries.
Benedict wrote his famous
Rule , which
became the guiding constitution of most monasteries in western Europe in the
Middle Ages. The monasteries were incubators of Christian and classical culture,
and outposts of evangelization in the barbarian kingdoms. As Cardinal
Newman wrote:
St Benedict found the world, physical and social, in ruins, and his mission
was to restore it in the way not of science, but of nature, not as if setting
about to do it [the caveat], not professing to do it by any set time, or
by any rare specific, or by any series of strokes, but so quietly, patiently,
gradually, that often till the work was done, it was not known to be doing.
It was a restoration rather than a visitation, correction or conversion.
The new work which he helped to create was a growth rather than a
structure . Silent men were observed about the country, or discovered
in the forest, digging, clearing and building; and other silent men, not
seen, were sitting in the cold cloister, tiring their eyes and keeping their
attention on the stretch, while they painfully copied and recopied the manuscripts
which they had saved.
There was no one who contended or cried out, or drew attention to what
was going on, but by degrees the woody swamp became a hermitage, a religious
house, a farm, an abbey, a village, a seminary, a school of learning and
a city.
... ... ...
Here are some basic Benedictine principles that we might think of as tools
for living the Christian life:
1. Order. Benedict described the monastery as
a "school for the service of the Lord." The entire way of life of the monastic
community was ordered by this telos , or end. The primary purpose
of Christian community life is to form Christians. The Benedict Option must
teach us to make every other goal in our lives secondary to serving God.
Christianity is not simply a "worldview" or an add-on to our lives, as it
is in modernity; it must be our lives, or it is something less than
Christianity.
2. Prayer and work. Life as a Christian requires
both contemplation and action. Both depend on the other. There is a reason
Jesus retired to the desert after teaching the crowds. Work is as sacred
as prayer. Ordinary life can and should be hallowed.
3. Stability. The Rule ordinarily requires monks
to stay put in the monastery where they professed their vows. The idea is
that moving around constantly, following our own desires, prevents us from
becoming faithful to our calling. True, we must be prepared to follow God's
calling, even if He leads us away from home. But the far greater challenge
for us in the 21st century is learning how to stay put - literally and metaphorically
- and to bind ourselves to a place, a tradition, a people. Only within the
limits of stability can we find true freedom.
4. Community. It really does take a village to
raise a child. That is, we learn who we are and who we are called to be
in large part through our communities and their institutions. We Americans
have to unlearn some of the ways of individualism that we absorb uncritically,
and must relearn the craft of community living.
Not every community is equally capable of forming Christians. Communities
must have boundaries, and must build these metaphorical walls because, as
the New Monastic pioneer Jonathan Wilson-Hartgrove writes, "we cannot become
the gift to others we are called to be until we embrace the limits that
are necessary to our vocation." In other words, we must withdraw behind
some communal boundaries not for the sake of our own purity, but so we can
first become who God wants us to be, precisely for the sake of the
world. Beliefs and practices that are antithetical to achieving the community's
telos must be excluded.
5. Hospitality. That said, we must be open to
outsiders, and receive them "as Christ," according to the Rule. For Benedictine
monks, this had a specific meaning, with regard to welcoming visitors to
the monastery. For modern laypersons, this will likely have to do with their
relationship to people outside the community. The Benedictines are instructed
to welcome outsiders so long as they don't interrupt communal life. It should
be that way with us, too. We should always be open to others, in charity,
to share what we have with them, including our faith.
6. Balance. The Rule of St. Benedict is marked
by a sense of balance, of common sense. As Ben Oppers experiment with building
and/or reforming communities and institutions in a more intentional way,
we must be vigilant against the temptations to fall intorigid legalism,
cults of personality, and other distortions that have been the ruin of intentional
communities. There must be workable forms of accountability for leadership,
and the cultivation of an anti-utopian sensibility among the faithful. A
community that is too lax will dissolve, or at least be ineffective, but
one that is too strict will also produce disorder. A Benedict Option community
must be joyful and confident, not dour and fearful.
Can you point to any contemporary examples of Ben Op communities?
Yes. There is a Catholic agrarian community around
Our Lady of Clear
Creek Abbey in eastern Oklahoma. The lay community gathered around
St. John Orthodox cathedral
in Eagle River, Alaska, is another.
Trinity Presbyterian
Church in Charlottesville, Virginia , is working towards incorporating a
version of the Rule of St. Benedict within its congregational life. Rutba House,
a New Monastic community in Durham, North Carolina, and its
School for Conversion
, is still another. I recently met a couple in Waco, Texas - Baylor philosophy
professor
Scott Moore and his wife Andrea - who bought a property near Crawford, Texas,
and who are rehabilitating it into a family home and a Christian retreat called
Benedict Farm. There is the
Bruderhof.
I am certain that there is no such thing as a perfect Ben Op community, and
that each and every one of them will have struggled with similar problems. In
working on the Benedict Option book, I intend to visit as many of these communities
as I can, to find out what they are doing right, what they wish they did better,
and what we can all learn from them. The Benedict Option has to be something
that ordinary people can do in their own circumstances.
Do you really think you can just run away from the world and live off
in a compound somewhere? Get real!
No, I don't think that at all. While I wouldn't necessarily fault people
who sought geographical isolation, that will be neither possible nor desirable
for most of us. The early Church lived in cities, and formed its distinct life
there. Most of the Ben Op communities that come to mind today are not radically
isolated, in geography or otherwise, from the broader community. It's simply
nonsense to say that Ben Oppers want to hide from the world and live in some
sort of fundamentalist enclave. Some do, and it's not hard to find examples
of how this sort of thing has gone bad. But that is not what we should aim for.
In fact, I think it's all too easy for people to paint the Benedict Option as
utopian escapism so they can safely wall it off and not have to think about
it.
Isn't this a violation of the Great Commission? How can we preach the
Gospel to the nations when we're living in these neo-monastic communities?
Well, what is evangelizing? Is it merely dispersing information? Or is there
something more to it. The Benedict Option is about discipleship , which
is itself an indirect form of evangelism. Pagans converted to the early Church
not simply because of the words the first Christians spoke, but because of the
witness of the kinds of lives they lived. It has to be that way with us too.
Pope Benedict XVI said something important in this respect. He said that
the best apologetic arguments for the truth of the Christian faith are the art
that the Church has produced as a form of witness, and the lives of its saints:
Yet, the beauty of Christian life is even more effective than art and
imagery in the communication of the Gospel message. In the end, love alone
is worthy of faith, and proves credible. The lives of the saints and martyrs
demonstrate a singular beauty which fascinates and attracts, because a Christian
life lived in fullness speaks without words. We need men and women whose
lives are eloquent, and who know how to proclaim the Gospel with clarity
and courage, with transparency of action, and with the joyful passion of
charity.
The Benedict Option is about forming communities that teach us and help us
to live in such a way that our entire lives are witnesses to the transforming
power of the Gospel.
It sounds like you are simply asking for the Church to be the Church.
Why do you need to brand it "the Benedict Option"?
That's a great point, actually. If all the churches did what they were supposed
to do, we wouldn't need the Ben Op. Thing is, they don't. The term "Benedict
Option" symbolizes a historically conscious, antimodernist return to roots,
an undertaking that occurs with the awareness that Christians have to cultivate
a sense of separation, of living as what Stanley Hauerwas and Will Willimon
call "resident aliens" in a "Christian colony," in order to be faithful to our
calling. And, "Benedict Option" calls to mind monastic disciplines that we can
appropriate in our own time.
It also draws attention to the centrality of practices in
shaping our Christian lives. The Reformed theologian James K.A. Smith, in his
great books
Imagining the Kingdom and
Desiring the Kingdom , speaks of these things. A recent secular book
by Matthew B. Crawford,
The World Beyond Your Head , talks about the critical importance of
practice as a way of knowledge. Here is Crawford writing about tradition and
organ making:
When the sovereignty of the self requires that the inheritance of the
past be disqualified as a guide to action and meaning, we confine ourselves
in an eternal present. If subjectivism works against the coalescing of communities
and traditions in which genuine individuals can arise, does the opposite
follow? Do communities that look to established forms for the meanings of
things somehow cultivate individuality?
… [C]onsider that when you go deep into some particular skill or art,
it trains your powers of concentration and perception. You become more discerning
about the objects you are dealing with and, if all goes well, begin to care
viscerally about quality, because you have been initiated into an ethic
of caring about what you are doing. Usually this happens by the example
of some particular person, a mentor, who exemplifies that spirit of craftsmanship.
You hear disgust in his voice, or see pleasure on his face, in response
to some detail that would be literally invisible to someone not initiated.
In this way, judgment develops alongside emotional involvement, unified
in what Polanyi calls personal knowledge. Technical training in such a setting,
though narrow in its immediate application, may be understood as part of
education in the broadest sense: intellectual and moral formation.
… What emerged in my conversations at Taylor and Boody [a traditional
organ-making shop] is that the historical inheritance of a long tradition
of organ making seems not to burden these craftspeople, but rather to energize
their efforts in innovation. They intend for their organs still be be in
use four hundred years from now, and this orientation toward the future
requires a critical engagement with the designs and building methods of
the past. They learn from past masters, interrogate their wisdom, and push
the conversation further in an ongoing dialectic of reverence and rebellion.
Their own progress in skill and understanding is thus a contribution to
something larger; their earned independence of judgment represents a deepening
of the craft itself. This is a story about the progressive possibilities
of tradition, then.
The Benedict Option is about how to rightly order the practices in our Christian
lives, in light of tradition, for the sake of intellectual and moral formation
in the way of Christ. You might even say that it's a story about the progressive
possibilities of tradition, and a return to roots in defiance of a rootless
age.
"... cultural nationalism is the only ideology capable of being a legitimising ideology under the prevailing global and national political economy. ..."
"... Neoliberalism cannot perform this role since its simplicities make it harsh not just towards the lower orders, but give it the potential for damaging politically important interests amongst capitalist classes themselves. ..."
"... In this form, cultural nationalism provides national ruling classes a sense of their identity and purpose, as well as a form of legitimation among thelower orders. ..."
"... As Gramsci said, these are the main functions of every ruling ideology. Cultural nationalism masks, and to a degree resolves, the intense competition between capitals over access to the state for support domestically and in the international arena – in various bilateral and multilateral fora – where it bargainsfor the most favoured national capitalist interests within the global and imperial hierarchy. ..."
This is where cultural nationalism comes in. Only it can serve to mask, and
bridge, the divides within the 'cartel of anxiety' in a neoliberal context.
Cultural nationalism is a nationalism shorn of its civic-egalitarian and developmentalist
thrust, one reduced to its cultural core. It is structured around the culture
of thee conomically dominant classes in every country, with higher or lower
positions accorded to other groups within the nation relative to it. These positions
correspond, on the whole, to the groups' economic positions, and as such it
organises the dominant classes, and concentric circles of their allies, into
a collective national force. It also gives coherence to, and legitimises, the
activities of the nation-state on behalf of capital, or sections thereof, in
the international sphere.
Indeed, cultural nationalism is the only ideology capable of being a legitimising
ideology under the prevailing global and national political economy.
Neoliberalism
cannot perform this role since its simplicities make it harsh not just towards
the lower orders, but give it the potential for damaging politically important
interests amongst capitalist classes themselves. The activities of the state
on behalf of this or that capitalist interest necessarily exceed the Spartan
limits that neoliberalism sets. Such activities can only be legitimised as being
'in the national interest.'
Second, however, the nationalism that articulates
these interests is necessarily different from, but can easily (and given its
function as a legitimising ideology, it must be said, performatively) be mis-recognised
as, nationalism as widely understood: as being in some real sense in the interests
of all members of the nation. In this form, cultural nationalism provides national
ruling classes a sense of their identity and purpose, as well as a form of legitimation
among thelower orders.
As Gramsci said, these are the main functions of every
ruling ideology. Cultural nationalism masks, and to a degree resolves, the intense
competition between capitals over access to the state for support domestically
and in the international arena – in various bilateral and multilateral fora
– where it bargainsfor the most favoured national capitalist interests within
the global and imperial hierarchy.
Except for a commitment to neoliberal policies, the economic policy content
of this nationalism cannot be consistent: within the country, and inter-nationally,
the capitalist system is volatile and the positions of the various elements
of capital in the national and international hierarchies shift constantly as
does the economic policy of cultural nationalist governments. It is this volatility
that also increases the need for corruption – since that is how competitive
access of individual capitals to the state is today organised.
Whatever its utility to the capitalist classes, however, cultural nationalism
can never have a settled or secure hold on those who are marginalised or sub-ordinated
by it. In neoliberal regimes the scope for offering genuine economic gains to
the people at large, however measured they might be, is small.
This is a problem for right politics since even the broadest coalition of
the propertied can never be an electoral majority, even a viable plurality.
This is only in the nature of capitalist private property. While the left remains
in retreat or disarray, elec-toral apathy is a useful political resource but
even where, as in most countries, political choices are minimal, the electorate
as a whole is volatile. Despite, orperhaps because of, being reduced to a competition
between parties of capital, electoral politics in the age of the New Right entails
very large electoral costs, theextensive and often vain use of the media in
elections and in politics generally, and political compromises which may clash
with the high and shrilly ambitiou sdemands of the primary social base in the propertied
classes. Instability, uncertainty ...
"... What is "Globalization" and "Free Trade" really?… Does it encompass the slave trade, trading in narcotics, deforestation and export of a nation's tropical hardwood forests, environmentally damaging transnational oil pipelines or coal ports, fisheries depletion, laying off millions of workers and replacing them and the products they make with workers and products made in a foreign country, trading with an enemy, investing capital in a foreign country through a subsidiary or supplier that abuses its workers to the point that some commit suicide, no limits on or regulation of financial derivatives and transnational financial intermediaries?… the list is endless. ..."
"... As always, the questions are "Cui bono?"… "Who benefits"?… How and Why they benefit?… Who selects the short-term "Winners" and "Losers"? And WRT those questions, the final sentence of this post hints at its purpose. ..."
"... Yeah, how is European colonialism - starting in, what, like the 15th century, or something - not "globalisation"? What about the Roman and Persian and Selucid empires? Wasn't that globalisation? I think we've pretty much always lived in a globalised world, one way or another (if "globalised world" even makes sense). ..."
"... Bring back the broader, and more meaningful conception of Political Economy and some actual understanding can be gained. The study of economics cannot be separated from the political dimension of society. Politics being defined as who gets what in social interactions. ..."
"... The neoliberal experiment has run its course. Milton Friedman and his tribe had their alternative plan ready to go and implemented it when they could- to their great success. The best looting system developed-ever. This system only works with the availability of abundant resources and the mental justifications to support that gross exploitation. Both of which are reaching limits. ..."
"... If only the Milton Friedman tribe had interested itself in sports instead of economics. They could have argued that referees and umpires should be removed from the game for greater efficiency of play, and that sports teams would follow game rules by self-regulation. ..."
"... Wouldn't the whole thing just work out more efficiently if you leave traffic lights and rules out of it? Just let everyone figure it out at each light, survival of the fittest. ..."
"... With increasingly free movement of people as tourists whose spending impacts nations GDP, where does it fit in to discussions on globalization and trade? ..."
What is "Globalization" and "Free Trade" really?… Does it encompass
the slave trade, trading in narcotics, deforestation and export of a nation's
tropical hardwood forests, environmentally damaging transnational oil pipelines
or coal ports, fisheries depletion, laying off millions of workers and replacing
them and the products they make with workers and products made in a foreign
country, trading with an enemy, investing capital in a foreign country through
a subsidiary or supplier that abuses its workers to the point that some
commit suicide, no limits on or regulation of financial derivatives and
transnational financial intermediaries?… the list is endless.
As always, the questions are "Cui bono?"… "Who benefits"?… How and
Why they benefit?… Who selects the short-term "Winners" and "Losers"? And
WRT those questions, the final sentence of this post hints at its purpose.
diptherio
Yeah, how is European colonialism - starting in, what, like the 15th
century, or something - not "globalisation"? What about the Roman and Persian
and Selucid empires? Wasn't that globalisation? I think we've pretty much
always lived in a globalised world, one way or another (if "globalised world"
even makes sense).
Norb
Bring back the broader, and more meaningful conception of Political
Economy and some actual understanding can be gained. The study of economics
cannot be separated from the political dimension of society. Politics being
defined as who gets what in social interactions.
What folly. All this complexity and strident study of minutia to bring
about what end? Human history on this planet has been about how societies
form, develop, then recede form prominence. This flow being determined by
how well the society provided for its members or could support their worldview.
Talk about not seeing the forest for the trees.
The neoliberal experiment has run its course. Milton Friedman and
his tribe had their alternative plan ready to go and implemented it when
they could- to their great success. The best looting system developed-ever.
This system only works with the availability of abundant resources and the
mental justifications to support that gross exploitation. Both of which
are reaching limits.
Only by thinking, and communicating in the broader terms of political
economy can we hope to understand our current conditions. Until then, change
will be difficult to enact. Hard landings for all indeed.
flora
If only the Milton Friedman tribe had interested itself in sports
instead of economics. They could have argued that referees and umpires should
be removed from the game for greater efficiency of play, and that sports
teams would follow game rules by self-regulation.
LA Mike September 17, 2016 at 8:15 pm
While in traffic, I was thinking about that today. For some time now,
I've viewed the traffic intersection as being a good example of the social
contract. We all agree on its benefits. But today, I thought about it in
terms of the Friedman Neoliberals.
Why should they have to stop at red lights. Wouldn't the whole thing
just work out more efficiently if you leave traffic lights and rules out
of it? Just let everyone figure it out at each light, survival of the fittest.
sd
Something I have wondered for some time, how does tourism fit into trade?
With increasingly free movement of people as tourists whose spending
impacts nations GDP, where does it fit in to discussions on globalization
and trade?
I Have Strange Dreams
Other things to consider:
– negative effects of immigration (skilled workers leave developing countries
where they are most needed)
– environmental pollution
– destruction of cultures/habitats
– importation of western diet leading to decreased health
– spread of disease (black death, hiv, ebola, bird flu)
– resource wars
– drugs
– happiness
How are these "externalities" calculated?
"... Something along the lines of Sweden, or maybe Germany: the means of production is left in private hands and the owning class is welcome to get rich (there are the equivalent of billionaires in both countries) but there are strict limits as to how much they can screw their workers, cheat their customers or damage the environment. ..."
"... Also, basic social welfare matters (healthcare, child care etc.) are publicly provided, or at least publicly backstopped. The model may not be perfect but it appears to work quite well all in all. ..."
"... Sweden has no taxes on inheritance or residential property, and its 22 percent corporate income tax rate is far lower than America's 35 percent." ..."
"... I do not think that drag queens reading stories, Lionel Shriver's speech and backlash, or the latest Clinton scandal mean civilizational death. They are outliers, but serve to remind the vast majority of the country that there is plenty of room in America for eccentrics of every description to pursue life, liberty, and the pursuit of happiness. ..."
"... HRC is not really unthinkable. She is just not preferable. A vote for HRC is an acquiescence to the status quo of corrupt, big money politics. Voting for the status quo is unthinkable only if you think the apocalypse is around the next bend. Let's be serious. ..."
"... "we are at the mercy of systematic forces, difficult to name, which can be manipulated by the powerful but not governed by them, and that our problems are unsolvable" ..."
"... I would argue that the "system" is capitalism grown decadent and corrupt. It is a secular religion that we've given ourselves over to and is exactly as he describes: a massive systemic force that some can manipulate for their own gain, but as a society we've lost the will or ability to control it's macro forces which have the power grind up whole demographics, communities, or crash the whole economy. ..."
"... The reaction and fall out from the financial crisis amounted to everyone shrugging and declaring innocence and ignorance. They seemed to say, how could anyone see such a thing coming or do anything about it? How could anyone control such a huge system? ..."
"... I'm always struck by these posts detailing how everything is coming apart in America. I look around and frankly, life looks pretty good. Maybe it's because I'm a minority female, who grew up poor and now has a solidly middle class life. My mother, God rest her soul, was smarter and worked harder than I ever will but did not have one-quarter of the opportunities (education, housing) I've had. My sons have travelled the globe, and have decent jobs and good friends. I am grateful. ..."
"... I wouldn't say that [neo] Liberalism is "spent" as a force, rather that its credibility is. As a cultural force (covering both politics and the economy, among other things), its strength is and remains vast. It is Leviathan. For all intents and purposes, it defines the culture, and thus dictates the imperatives and methods, of our governing and economic elites. ..."
"... Bush proved that electing an imbecile to the Presidency has real consequences for our standing in the world. ..."
"... Trump starts speaking without knowing how his sentence will end, and then he will go to down fighting to defend whatever it was he said even though he never really meant it in the first place. That mix of arrogance and stupidity is more dangerous than Bush. ..."
"... Totally unconvincing. It couldn't be more obvious that Hillary stands for rule by globalists whereas Trump intends to return control of the federal government to We the People. ..."
"... Which candidate is traveling to Louisiana? Flint? Detroit? Mexico (on behalf of America)? Which candidate calls tens of millions of Americans irredeemable and thus it would be justified in exterminating them? ..."
"... What makes Mr. Cosimano so sure that what America is passing into is anything like a "civilization" at all? We could simple pass into barbarism. Can anyone name the leaders who hope to build any kind of civilization at all? ..."
"... For 70+ years, other than while working on a university degree in history, I never gave a thought to civilizational collapse, so I would have been a poor choice to ask for a definition of the term. But after a few years of reading TAC I think I have a handle on it. It's a situation in which someone or some group sees broad social change they don't like. So probably civilizational collapse is constant and ongoing. ..."
"... I would only point out that there is no clear path to economic safety for working Americans, whether they are white are black. Training and hard work will only take you so far in our demand-constrained economy. Whether black optimism or white pessimism turns out to be empirically justified is far from certain. We are constructing the future as we speak, and our actions will determine the answer to this question. ..."
"... As the WikiLeaks dox show, it wasn't "barrel bombs" or "chemical warfare against his own people" that made the elites hungry to overthrow the government there, it was the 2009 decision by Syria not to allow an oil pipeline through from Qatar to Turkey, whereupon the CIA was directed to start funding jihadists and regime change. ..."
"... I'd note that Popes going back to Leo XIII have written on the destructive effects of capitalism or rather the unmitigated pursuit of wealth. Both Benedict and Francis have eloquently expressed the need for a spiritual conversion to solve the world's problems. A conversion which recognizes our solidarity with one another as well as our obligation to the health of Creation. I rather doubt we will find the impetus for this conversion among our politicians. ..."
"... The problem is not civilization-level, Mr. Dreher. The problem is species -level. Humanity as a whole is discovering that it cannot handle too high a level of technology without losing its ability to get feedback from its environment. Without that feedback, its elite classes drift off into literal insanity. The rest of the society soon follows. ..."
"... James Parker in The Atlantic comes to a similar conclusion from a very different starting place ..."
"... "For Trump to be revealed as a salvational figure, the conditions around him must be dire. Trump_vs_deep_state-like fascism, like a certain kind of smash-it-up punk rock-begins in apprehensions of apocalypse." ..."
"... Classical [neo]liberalism presents itself not as a tentative theory of how society might be organized but as a theory of nature. It claims to lay out the forces of nature and to make these a model for social order. Thus free-market fundamentalism, letting the market function "as nature intended". It's an absurd position when applied dogmatically, and no more "natural" than other economic arrangements humans might come up with. ..."
"... Further, as I suggest, our two camps "left" and "right" are no longer distinctly left and right in any traditional sense. The market forces and self-marketing that lead to the fetishization of identity by the left are the same market forces championed by the capitalist right. In America today, both left and right are merely different bourgeois cults of Self. ..."
"... "Pope Francis (and to a slighly lesser degree, his two predecessors) has spoken frequently about unbridled capitalism as a source of the world ills. But his message hasn't been that well received among American conservatives." ..."
Re: we have yet to hear a cogent description of what "bridled" capitalism
is/looks like
Something along the lines of Sweden, or maybe Germany: the means
of production is left in private hands and the owning class is welcome
to get rich (there are the equivalent of billionaires in both countries)
but there are strict limits as to how much they can screw their workers,
cheat their customers or damage the environment.
Also, basic social welfare matters (healthcare, child care etc.)
are publicly provided, or at least publicly backstopped. The model may
not be perfect but it appears to work quite well all in all.
I think a lot of American capitalists would welcome those bridles.
As for Hanby's critique of the liberal order that (thankfully) prevails
in the West, it is only because of that liberal order that we are freely
discussing these matters here, that we can talk about a Benedict Option
in which we can create an economy within the economy, because in the
non-liberal orders that prevailed through most of history, and that
still prevail in a lot of places, we'd be under threat from the state
for free discussion, and we would have little or no choice of education
or jobs, because we'd be serfs or slaves or forced by government to
go into a certain line of work (like my husband's Mandarin teacher,
a scientist who was forced into the countryside during the Cultural
Revolution and then told that she had to become a language teacher.)
I'd be interested to know what kind of system Hanby would like to
see replace our liberal order. Presumably one where he would be in charge.
[neo]Liberalism is exhausted? What does that even mean, except as a
high-brow insult?
If there is one statistic that disproves this claim, it's that religious
attendance is plummeting and the number of people who are "nones" are
rising rapidly.
What's exhausted is religion as a necessary component of social life.
Since that is indisputably true, I guess the only thing that is left
is for the remaining stalwarts resisting the tide to project this idea
of exhaustion onto the other side.
[NFR: You don't understand his point. He's not talking about liberalism
as the philosophy of the Democratic Party. He's talking about liberalism
as the political culture and system of the West. - RD]
"There is nothing like a good shock of pain for dissolving certain
kinds of magic."
Could be that Trump is God's Hot Foot Angel With The Dirty Face waking
Americans up to the increasingly Godless Agenda of The Washington Establishment
and The Corporate Media.
Talk about cynical. There's a lot to take exception to here, but let's
start with this:
"In other words, the fact that we are in civilizational crisis is
becoming unavoidably apparent, though there is obviously little agreement
as to what this crisis consists in or what its causes are and little
interest from the omnipresent media beyond how perceptions of crisis
affect voter behavior."
Possibly because he's one of the relatively few people who think
we're in such a crisis. A lot of us – Republican and Democrat – still
believe ideas and ideals are important and we support them (and their
torchbearers, however flawed) with all the vigor we can muster.
I do not think that drag queens reading stories, Lionel Shriver's
speech and backlash, or the latest Clinton scandal mean civilizational
death. They are outliers, but serve to remind the vast majority of the
country that there is plenty of room in America for eccentrics of every
description to pursue life, liberty, and the pursuit of happiness. I
will admit to thinking this kind of thing much more important on college
campuses, where it can affect the quality of an education.
"We would not see it as a crisis of soul, but a crisis of management…"
Probably true: I'm not so sure that our founding principles really
envision our civilization as having a soul rather than virtues. And
the idea of a national government mucking around with the souls of the
people gives me the heebie-jeebies much as Putin's alliance with the
Orthodox church does you. And if there's anything we can take from the
current election, I think it's that Americans have had enough sociologists,
economists, lawyers, and other "experts" tell them what to do to last
a lifetime. It's part and parcel of the distrust you just posted about.
And I'm not at all sure that Americans are generally despairing,
though it's pretty clear they think our country is on the wrong track.
Hillary ought to be running away with this thing – why isn't she? Because
she's seen as more of the same. Sanders offered the hope of something
new, something transformative: the same thing people see in Trump. Their
hope MAY be misplaced but time will tell. This election cycle ought
to make people a little less confident in their predictions.
"Hope is hard, I admit. But my response is that it is not the pessimist
about liberalism who lacks hope, but the optimist who cannot see beyond
its horizons."
Hope is hard if you're investing in our institutions to carry us
through. They aren't designed to. Our hope is in Christ, Our Redeemer,
and that His will "be done on earth as it is in Heaven." And I will
gladly admit to not being able to see beyond liberalism's horizons –
again, the predictions of experts and philosophers haven't held up too
well over time.
I can say that blithely because my hope is not in liberalism, ultimately.
Do I think some semblance of liberalism can and will survive? Yes, but
the cultural struggles we are going through are part and parcel of the
system. Do I like that? No.
And as much as we need to reinforce communities (through the BenOp)
we also need to recognize that our job isn't always to understand and
prepare. As Christians, it is to obey. It means we repent, fast, and
pray. It means we take the Great Commission seriously even when it's
uncomfortable.
I'm sorry to rip your friend here, I just don't find his piece compelling
at all.
HRC is not really unthinkable. She is just not preferable. A vote for
HRC is an acquiescence to the status quo of corrupt, big money politics.
Voting for the status quo is unthinkable only if you think the apocalypse
is around the next bend. Let's be serious.
Voting for Trump is unthinkable because he is totally clueless about
seemingly he talks about. His arrogance is only surpassed by his ignorance.
Gary Johnson was excoriated because he did not know what Aleppo is.
I bet a paycheck Trump couldn't point to Syria on a map. Trump get's
no serious criticism for insistence that we steal Iraq's oil, his confusion
about why Iran wasn't buying our airplanes, his assertion that Iran
is North Koreas largest trading partner, that South Korea and Japan
ought to have nukes, his threats to extort our NATO allies. There are
dozens of gems like these, but you get the picture. One only needs to
read transcripts from his interviews to understand the limits of his
intellect. Voting for such a profound ignoramus is truly unthinkable.
Teenagers born after 2000 – the so-called 'Generation Z' – are
the most socially conservative generation since the Second World War,
a new study has found.
The youngsters surveyed had more conservative views on gay marriage,
transgender rights and drugs than Baby Boomers, Generation X or Millennials.
The questioned were more prudent than Millennials, Generation X and
Baby Boomers but not quite as cash-savvy as those born in 1945 or before.
…
Only 14 and 15-year-olds were surveyed, by brand consultancy The Gild,
as they were classed as being able to form credible opinions by that
age.
When asked to comment on same-sex marriage, transgender rights and
cannabis legislation, 59 per cent of Generation X teenagers said they
had conservative views.
Around 85 per cent of Millennials and those in Generation X had a
'quite' or 'very liberal' stance overall.
When asked for their specific view on each topic only the Silent
Generation was more conservative that Generation Z.
One in seven – 14% – of the 14 and 15-year-olds took a 'quite conservative'
approach, while only two per cent of Millennials and one per cent of
Generation X.
The Silent Generation had a 'quite conservative' rating of 34
per cent.
I think this was done in Britain but as we know, social trends in
the rest of the West tend to spill over into the States.
Are we looking at another Alex P. Keaton generation? Kids likely
to rebel against the liberalism of their parents?
I can never quite understand the tension between these two concepts:
enlightenment liberalism as a spent force, enervated, listless, barely
able to stir itself even in its own defense, and simultaneously weaponized
SJWism, modern day Jacobins, an army of clenched-jawed fanatics who
will stop at nothing to destroy its enemies.
It seems that one of these perspectives must be less true than the
other.
[NFR: SJWs are a betrayal of classical liberalism. - RD]
I realize that I only comment here when something sets me off, and not
when I agree with you (which is after all why I keep reading you).
So here I am agreeing with this post.
"we are at the mercy of systematic forces, difficult to name, which
can be manipulated by the powerful but not governed by them, and that
our problems are unsolvable"
I would argue that the "system" is capitalism grown decadent and
corrupt. It is a secular religion that we've given ourselves over to
and is exactly as he describes: a massive systemic force that some can
manipulate for their own gain, but as a society we've lost the will
or ability to control it's macro forces which have the power grind up
whole demographics, communities, or crash the whole economy.
The reaction and fall out from the financial crisis amounted to everyone
shrugging and declaring innocence and ignorance. They seemed to say,
how could anyone see such a thing coming or do anything about it? How
could anyone control such a huge system?
As your friend says, even if we want to exert more control over this
system (which we can with the will), this would end up being a technocratic
project, not a spiritual one. Sad because a spiritual argument against
the excesses of capitalism might actually gain more traction at this
point, than tired liberal arguments.
I'm always struck by these posts detailing how everything is coming
apart in America. I look around and frankly, life looks pretty good.
Maybe it's because I'm a minority female, who grew up poor and now has
a solidly middle class life. My mother, God rest her soul, was smarter
and worked harder than I ever will but did not have one-quarter of the
opportunities (education, housing) I've had. My sons have travelled
the globe, and have decent jobs and good friends. I am grateful.
My friends and I went out the other night in Austin, and there were
families, very diverse, walking in the outdoor mall, standing in line
to buy $5 scoops of ice cream for their children. Not hipsters, or God
forbid the elite, just regular middle class folk enjoying an evening
out. The truth is, life has improved immeasurably for many Americans.
Do we have serious problems? Of course, but can we have just a wee bit
of perspective?
You may be right about the problem, but not its nature. Capitalism
is not an impersonal force that can't be controlled, it's what people
do economically if they are left alone to do it. The problem comes when
people are not, simply put, virtuous. When people seek a return on investment
that is not simply reasonable, but rather the most they can possibly
get. We have had a capitalist system for long enough that some people
who are both good at manipulating it and, often, unethical enough to
not care what impact their choices have on others, have accumulated
vast amounts of wealth while others, over generations, have made choices
that have not been profitable, have lost wealth.
There used to be mechanisms for preventing these trends to continue
to their logical conclusion, as they are here. Judea had Jubilee. The
Byzantine Empire had an Emperor whose interests were served by a prosperous
landed middle class to populate the Thematic armies and who would occasionally
step in and return the land his part time soldiers had lost through
bad loans from aristocrats. We have no such mechanism for a farmer to
regain land lost due to foreclosure.
We should not redistribute wealth in such a way that a person has no
incentive to work, but we should never allow a person's means of earning
a livelihood to be taken from them.
I wouldn't say that [neo] Liberalism is "spent" as a force, rather that its
credibility is. As a cultural force (covering both politics and the
economy, among other things), its strength is and remains vast. It is
Leviathan. For all intents and purposes, it defines the culture, and
thus dictates the imperatives and methods, of our governing and economic
elites. The crisis of Western political legitimacy that is manifest
in the nomination of Trump, Brexit and numerous other movements and
incidents is a sign that the legitimacy of this order has been undermined
and is dissolving within the societies it effectively governs; in some
unspoken sense, the unwashed masses of the West (those not part of the
so-called "New Class") have come to understand that they have been betrayed
by the Liberal order, that it has not lived up to its promises, even
that it is becoming or has become a force destructive of their communities
and their ability to thrive as human beings.
The ever-increasing autonomy promised by the Liberal order has turned
out to be a poisoned chalice for many. As it has dissolved the bonds
of families and communities, it has atomized people into individuals
without traditional social supports in an increasingly cutthroat and
uncaring world. People cannot help but understand that they have lost
something or are missing something, even if they are not able to articulate
or identify that loss. It is a sickness of the soul, in the sense that
the ailment is somewhere close to the heart of what it means to be human.
We are what we are, and the Liberal order is pushing us into opposition
to our own natures, as if we can choose to be something other than what
we are.
This idea that Democrats hate Hillary in the same way Republicans despise
Trump is way off base in my opinion. This attempt at equivalency, like
so many others, is false. I voted for Sanders because I liked him better,
but I am not holding my nose to vote for Hillary Clinton. There are
several things I actually admire about her, including her attention
to detail and tenacity. I'll always remember how she sat before Congress
as First Lady, no paper or crib sheet in sight, and presented her detailed
and compelling case for national health care . I thought that was awesome
then, and still do.
Still, as I've noted many times, I never liked the Clintons that
much, mainly because I hated a lot of what Bill Clinton stood for and
what he did. Aside from his embarrassing sexual escapades, most of that
pertained to positions that seemed more Republican than Democratic (on
welfare mothers, mental patients, deregulation of the broadcast industry,
etc.) I also didn't like their position on abortion nor the way their
people treated Gov. Casey at the party convention, nor the dialing back
on Jimmy Carter's uncompromising stand for human rights in the third
world. Some of Hillary's hawkish positions are still a concern, but
what she stands for in general is far and away more humane and within
my understanding of what's good for the country and the world at large
than anything Republicans represent. Their ideas hurt people on too
many fronts to justify voting for them just because I may agree with
them on principle when it comes to matters such abortion. Trump just
adds insult to injury in every regard.
Very well said. What accounts for the relative optimism of minorities
vs. whites?
State of the economy, personal situation, optimism that your kids future
will be better than yours, etc. In all of these surveys, it is the pessimism
of whites, untethered from empirical reality, that stands out as the
outlier.
"Sad because a spiritual argument against the excesses of capitalism
might actually gain more traction at this point, than tired liberal
arguments."
It would gain more traction, and it would be better focused at what
is much larger cause of the current social, economic, and family problems
of the working classes.
But the argument won't be made, because the majority of those that
believe in a societal crisis have pinned the origin of this crisis on
feminism, the sexual revolution, and SJW, and have bought in full the
bootstraps language of the radical capitalism. Even the majority crunchy
cons, that would be sympathetic to the arguments against capitalism,
would rather try to solve the ills of the world via cultural instead
of economic ways.
Pope Francis (and to a slighly lesser degree, his two predecessors)
has spoken frequently about unbridled capitalism as a source of the
world ills. But his message hasn't been that well received among American
conservatives
[NFR: Pope St. John Paul II and Pope Benedict said the same thing.
- RD]
Bush proved that electing an imbecile to the Presidency has real
consequences for our standing in the world. Trump is just as stupid,
but he is far more dangerous. At least Bush wasn't a egomaniac.
Trump starts speaking without knowing how his sentence will end, and
then he will go to down fighting to defend whatever it was he said even
though he never really meant it in the first place. That mix of arrogance
and stupidity is more dangerous than Bush.
"In fact, I doubt we any longer possess enough of a 'civilization' to
understand what a 'civilizational crisis' would really mean."
I think someone has no idea what "civilization" means. None of his
definitions apply.
What we are seeing is the radical change in Western Civilization
from the old Graeco-Roman/Christian model to a yet undefined American
model. (Which is why Islam in Europe is not very important. Europe is
no longer very important.) No one guards the "glory that was Greece"
any more. We've moved out of that. The debate will be when did the transition
occur. Did it begin in the 19th Century with the Age of Invention? Did
it occur in the flash of gunpowder that was WW1? Was it the blasting
to rubble of Monte Cassino when the weapons of the new blew the symbol
of the old to ruin? Was it the moment men stood upon the Moon and nothing
the bronze age pilers of rocks had to say was of any value any more?
The key to understanding the change is that the old values are dead
and we are in the process of creating new ones. No one knows where that
is going to go. It is all too new.
Hanby is wrong. We have a civilization, but it is leaving his in
the dust.
Totally unconvincing. It couldn't be more obvious that Hillary stands
for rule by globalists whereas Trump intends to return control of the
federal government to We the People.
Which candidate is traveling to Louisiana? Flint? Detroit? Mexico
(on behalf of America)? Which candidate calls tens of millions of Americans
irredeemable and thus it would be justified in exterminating them?
Seriously, only one of these two appears interested in leading the
nation.
"What's exhausted is religion as a necessary component of social
life."
This is so hilariously untrue, but also very sad that the secular
Left cannot see its own idols or even read its own headlines.
What does he think is happening in the United States besides the
rise of a revolutionary moral order, ruled by fickle tastemakers who
believe that their own emotions and thoughts have creative power? How
else would history have a "side"? How else could "gender" be entirely
unmoored from sex and any other scientific fact? Progressivism even
has "climate change" as its chosen apocalypse which will visit destruction
if not enough fealty is granted to an ever-more-omnipotent and omniscient
central government? Does he not see how over and over again, this week's
progressive leaders attacks last week's? Amy Schumer, anyone?
Once a culture abolishes the One True God, as ours has, then that
culture begins to find other sources for the attributes of God and for
the definitions of virtues and vices.
What makes Mr. Cosimano so sure that what America is passing into
is anything like a "civilization" at all? We could simple pass into
barbarism. Can anyone name the leaders who hope to build any kind of
civilization at all?
Never forget that there is a real and clear choice before us.
Clinton will deliver amnesty to 40 million illegals. Continue the
1 million legal immigrants per yer all from the Third World. She will
radically upsize the Muslim refugee influx to hundreds of thousands
per year. All terrible things.
Trump will do the opposite. This will make a massive difference to
the future of the country - Trump, good…Clinton, bad - and is what this
election is about.
For 70+ years, other than while working on a university degree in history,
I never gave a thought to civilizational collapse, so I would have been
a poor choice to ask for a definition of the term. But after a few years
of reading TAC I think I have a handle on it. It's a situation in which
someone or some group sees broad social change they don't like. So probably
civilizational collapse is constant and ongoing.
As for me, I'm outside somewhere every day and so far not even a
tiny piece of the sky has fallen on me.
@xrdsmom
Empirical reality depends on where you stand. Younote that your prospects
have improved relative to your mom's. For the working class whites working
at low paying jobs, they have declined. Is their anger simply a response
to loss of white privilege? In the sense that this privilege consisted
of access to well-paying jobs out of high school, the answer is yes.
I would only point out that there is no clear path to economic safety
for working Americans, whether they are white are black. Training and
hard work will only take you so far in our demand-constrained economy.
Whether black optimism or white pessimism turns out to be empirically
justified is far from certain. We are constructing the future as we
speak, and our actions will determine the answer to this question.
It's true a lot of people couldn't point to Syria; because that's how
important it is to most people. So why are we now involved in a full
scale war there, when the American people clearly stated they didn't
want another war?
As the WikiLeaks dox show, it wasn't "barrel bombs" or "chemical
warfare against his own people" that made the elites hungry to overthrow
the government there, it was the 2009 decision by Syria not to allow
an oil pipeline through from Qatar to Turkey, whereupon the CIA was
directed to start funding jihadists and regime change.
Hillary is not as corrupt as some think nor is Trump likely to be able
to enact much of his agenda(most of which he has no commitment to –
it is all a performance). So I do not see either as end times candidates.
However – a civilization must assure certain things – order, cohesion,
safety from invasion and occupation. It also must assure that the resources
we secure from the earth are available – good soil, clean water, sustainable
management of energy sources etc. This is where our civilization is
failing – if you doubt this – spend a moment looking up soil erosion
on Google. Or dead zones Mississippi and Nile deltas. Depletion of fish
stocks. Loss of arable land and potable water all over the planet. Is
this calamitous failure a function of liberalism or capitalism run amok?
Perhaps the two go hand in hand?
I'd note that Popes going back to
Leo XIII have written on the destructive effects of capitalism or rather
the unmitigated pursuit of wealth. Both Benedict and Francis have eloquently
expressed the need for a spiritual conversion to solve the world's problems.
A conversion which recognizes our solidarity with one another as well
as our obligation to the health of Creation. I rather doubt we will
find the impetus for this conversion among our politicians.
But there are certainly all over the earth groups of people who have
experienced this conversion and are seeking to build civilizations which
are just and sustainable. Rod has written about some – his friends in
Italy as an example.
The problem is not civilization-level, Mr. Dreher. The problem is
species -level. Humanity as a whole is discovering that it cannot handle
too high a level of technology without losing its ability to get feedback
from its environment. Without that feedback, its elite classes drift
off into literal insanity. The rest of the society soon follows.
The trick is going to be recovering our connection with the Realities
of existence without bringing technological civilization down or re-engineering
Humanity into something we would not recognize.
Color me less than optimistic about our prospects.
"I really think there is a pervasive, but unarticulated sense that
liberalism is exhausted, that we are at the mercy of systematic forces,
difficult to name, which can be manipulated by the powerful but not
governed by them, and that our problems are unsolvable. The reasons
for this anxiety are manifold and cannot be reduced to politics or economics…"
"For Trump to be revealed as a salvational figure, the conditions
around him must be dire. Trump_vs_deep_state-like fascism, like a certain kind
of smash-it-up punk rock-begins in apprehensions of apocalypse."
Hanky's diagnosis is brilliant. Yes, thanks for posting, Rod.
One of our fundamental problems, along with the conceptual horizons
imposed by liberalism, is the obsolete language of "left" and "right"
that we continue to apply when weighing our options. This too is part
of why we can't construct a politics of hope, and in my reading it explains
the decline of the left into identity politics (our Democratic Party
is not any more "the left" in any meaningful way) and of the right into
"movement conservatism" or Trumpian nationalism.
Classical [neo]liberalism presents itself not as a tentative theory of
how society might be organized but as a theory of nature. It claims
to lay out the forces of nature and to make these a model for social
order. Thus free-market fundamentalism, letting the market function
"as nature intended". It's an absurd position when applied dogmatically,
and no more "natural" than other economic arrangements humans might
come up with.
The only truly rock solid aspect of classical liberalism in my mind
is its theory of individual dignity, the permanent and nonnegotiable
value of each individual in essence and before the law. The left has
taken this and run with it and turned it into a divination of individual
desire and self-definition, which is something different. The capitalist
right has taken it and turned it into a theory of individual responsibility
for one's economic fate, which is helpful in ways, but not decisive
or even fully explanatory as to why people end up where they are. And
a lot of people are not in a good place thanks to the free trade enthusiasts
who believe what they're up to somehow reflects the eternal forces of
nature.
Further, as I suggest, our two camps "left" and "right" are no
longer distinctly left and right in any traditional sense. The market
forces and self-marketing that lead to the fetishization of identity
by the left are the same market forces championed by the capitalist
right. In America today, both left and right are merely different bourgeois
cults of Self.
It should be no surprise that the inalienable dignity of the individual,
that rock solid core of liberal thinking, grew directly from the Christian
soil of Paul's assertion of the equality of all–men, women, Greek, Jew,
freed, slave–in Christ. (Galatians 3:28) The world's current thinking
on "human rights" is merely a universalized version of Paul's thought,
hatched in a Christian Europe by philosophes who didn't recognize
just how Christian they were.
After all the utopian dusts settle, whether the dust of Adam Smith
or the dust of PC Non-Discrimination, we must see that the one thing
holding us together is this recognition that the political order must
respect human rights. The core issue at present is thus that we legislate
in ways that reflect a realistic understanding of these rights. As for
"movement conservatism" or PC progressivism, they each represent pipe
dreams that don't address the economic or legal challenges in coherent
ways, and they each sacrifice true rights at one altar or another.
The obsolete language of "left" and "right" keeps us unwilling to
grapple with the real economic and legal challenges, if only because
we're too busy cheerleading either one version of the capitalist cult
or the other.
I'm looking forward to The Benedict Option mainly as providing
some answers as to how the remnant of faithful Christians in this mayhem
might both hold their faith intact while perhaps simultaneously developing
less utopian modes of thinking about community. The neoliberal order
may very well be shaping up to be for us something like the pagan Roman
Empire was to the early church. We finally have to face that, politically
speaking, we are in the world but not of it.
Re: Clinton will deliver amnesty to 40 million illegals.
Will she be inviting them in from parallel universes? Because we
do not have 40 million illegals. The number is closer to eleven million.
Also the president can't do this on his/her own. Congress has to
act. The House will remain GOP. The Senate may too, or will flip back
to GOP after 2018. As I mentioned Clinton's hands will be tied as much
as Obama's have been since 2010. That includes Supreme Court appointments.
Only the most boring of moderates will get through– sure, they won't
overturn Roe or Oberfell, but they won't rubber stamp much new either.
"Pope Francis (and to a slighly lesser degree, his two predecessors)
has spoken frequently about unbridled capitalism as a source of the world
ills. But his message hasn't been that well received among American conservatives."
[NFR: Pope St. John Paul II and Pope Benedict said the same thing. -
RD]"
It doesn't sit well for two reasons: (a) we have yet to hear a cogent
description of what "bridled" capitalism is/looks like and (b) capitalism
has its faults, but it has raised far more boats than it has swamped.
Until we hear an admission of (b) and an explanation of (a), their statements
will continue to fall on deaf ears. Particularly from Pope Francis, whose
grip on economic ideas seems tenuous at best.
"...a full 95% of the cash that went to Greece ran a trip through Greece
and went straight back to creditors which in plain English is banks. So,
public taxpayers money was pushed through Greece to basically bail out banks...So
austerity becomes a side effect of a general policy of bank bailouts that
nobody wants to own. That's really what happened, ok?
Why are we peddling nonsense? Nobody wants to own up to a gigantic bailout
of the entire European banking system that took six years. Austerity was
a cover.
If the EU at the end of the day and the Euro is not actually improving
the lives of the majority of the people, what is it for? That's the question
that they've brought no answer to.
...the Hamptons is not a defensible position. The Hamptons is a very
rich area on Long Island that lies on low lying beaches. Very hard to defend
a low lying beach. Eventually people are going to come for you.
What's clear is that every social democratic party in Europe needs to
find a new reason to exist. Because as I said earlier over the past 20 years
they have sold their core constituency down the line for a bunch of floaters
in the middle who don't protect them or really don't particularly care for
them. Because the only offers on the agenda are basically austerity and
tax cuts for those who already have, versus austerity, apologies, and a
minimum wage."
Mark Blyth
Although I may not agree with every particular that Mark Blyth may say, directionally
he is exactly correct in diagnosing the problems in Europe.
And yes, I am aware that the subtitles are at times in error, and sometimes
outrageously so. Many of the errors were picked up and corrected in the comments.
No stimulus, no plans, no official actions, no monetary theories can be sustainably
effective in revitalizing an economy that is as bent as these have become without
serious reform at the first.
This was the lesson that was given by Franklin Roosevelt's New Deal. There
will be no lasting recovery without it; it is a sine qua non . One cannot
turn their economy around when the political and business structures are systemically
corrupt, and the elites are preoccupied with looting it, and hiding their spoils
offshore.
"... Like Greece is finding out now, if you have to import virtually all your energy and can't export high energy finished products like Germany and Japan, then you are in trouble. ..."
"... Except the problem we have today is NOT Capitalism. Far from it in fact! We are in Neo-Corporatism and have left Capitalism in the past! ..."
"... Conventional oil peaked in 2005. Well, okay, effectively plateaued. We'll probably see the ultimate peak this year. We haven't reached peak debt…yet. What happens when we reach peak energy and peak debt? What happens when we reach Peak Everything? ..."
"... 40 years ago the Limits to Growth study was published, based on a systems dynamics model of the world's population, economic production, resources and pollution, and how they would interact. It forecast the sort of trouble we are now seeing, and its "business-as-usual" scenario predicted system collapse in the mid-21st Century. Governments and society leaders should have taken note back then, but they didn't, and their behaviour shows how poorly "capitalism" does rise to the challenge of global problems - it obfuscates, it denies, it defers, and it goes on doing its own thing regardless in the face of all evidence that it is on a path to destruction. Now we are left with a world that is consuming the equivalent of one and a half planets a year, and still, many are in denial. ..."
"... It sounds hopeful that economists are questioning the assumptions of neoliberalism, but if, as I suggested, the real change is less ideological and more to do with elites preferring to be elite even if in poorly functioning economies and dysfunctional societies, these criticisms may be ignored. Anyway, if we get Jeremy Corbyn and Bernie Sanders, perhaps then we'll see! But it's up to everyone to keep making and refining the arguments, and to get them across. I think even the most indoctrinated people can change their views very quickly when they encounter good sense. ..."
Spectacularly woolly waffle, much like the Gladwell, but its information
value -- if I were pressed to put a price on it -- is that it provides a
certain kind of gentleman with late-night bar talk who would otherwise have
nothing at all to say for himself, or go on about chaos theory. That's got
to be a few quid.
Eduardo Martinez -> JezJez 20 Jul 2015 05:55
You are correct, Capitalism is more efficient than all the other 'isms'
in maximising resource and energy extraction. Unfortunately fossil energy
is a finite, as we are going to find out shortly. Castles made in sand ......
Eduardo Martinez -> denise2933 20 Jul 2015 05:36
You got it in one, even though your comment was intended to be sarcastic.
The UK will not support a population of 64 million without fossil energy.
North Sea oil extraction peaked in 2000, World conventional oil extraction
plateaued in 2006. These are facts not opinion.
Like Greece is finding out now, if you have to import virtually all your
energy and can't export high energy finished products like Germany and Japan,
then you are in trouble. You can no longer afford a first world standard
of living.
REALITY is such a bitch.
schauffler -> NadiaJohanisova 20 Jul 2015 05:32
This is an excellent response to what looks like, unfortunately, another
boosterish celebration of the "liberating" qualities of a technological
regime which is produced by, and dependent upon, the most aggressive, concentrated
and uncontrollable form of capitalism pure and simple. The endless iteration
of the word "information", as if this denoted something uniform, powerful,
desirable or even identifiable, suggests that the author has only a sketchy
idea even of his own theory, nor does he deign to discuss -- in the excerpt
printed above -- the mechanics of the concentration of capital and the dynamics
of perpetual accumulation. As Ms. Johanisova rightly points out, there is
no mention made of the gigantic forces manifest in the production and distribution
of our information networks and the (ever-increasing) amounts of energy
they require to be sustained. Nor are we given any clear idea how "information"
will liberate us from dependence on these forces. Does the author think
that Samsung, Exxonmobil, Unilever, Maersk Sealand and Koch Industries will
somehow be replaced by global co-ops that eschew profit?
malachimalagrowther -> Urgelt 20 Jul 2015 04:52
This was a sane, well-informed and percipient comment. "I have seen the
future, and it is bleak." If the past is any guide, the current accumulation
of everything in the hands of a very few will be solved neither by information
nor wishing it. The inequalities of, for example, the Belle Epoque, were
reduced only by war. That is hardly to be wished for, hardly to be avoided
anyway. We cannot count on a peaceful extrapolation of trends.
NadiaJohanisova 20 Jul 2015 04:44
I would agree with the main thrust of the argument: that one way out
of the current system (or part of it) is via localised and democratically
governed systems of mutual support, services and production. I like some
of the insights (eg austerity as the first step of the race to the bottom)and
feel close to the general values espoused b the author. But I am worried
about the authors´s linear Eurocentric evolutionary model of the world,
his over-emphasis on technology as driving this change,his naive view of
information technology as costless and without power-imbalances and most
of all his ignorance of environmental aspects and dimensions of what he
discusses.
"Postcapitalism" - Paul Mason should perhaps acknowledge that he has
not coined this term (see eg the book JK Gibson-Graham: A post capitalist
politics.).
"The red flags and marching songs of Syriza during the Greek crisis, plus
the expectation that the banks would be nationalised, revived briefly a
20th-century dream: the forced destruction of the market from above." The
article is Northern-Europe-centered. As far as I know the revolutionary
ideals are still very much alive in may parts of the world incl. Southern
Europe. Also, it is I think counter-productive to delete government policies
from the equation of whatever needs to be done to reach sustainable and
equitable societies. The capitalist machine, the growth imperative, the
race to the bottom will not go away if we stick our hands in the sand. Nb.
Nationalising banks does not = destruction of market.
"Postcapitalism is possible because of three major changes information
technology has brought about in the past 25 years. First, it has reduced
the need for work, blurred the edges between work and free time and loosened
the relationship between work and wages. The coming wave of automation,
currently stalled because our social infrastructure cannot bear the consequences,
will hugely diminish the amount of work needed – not just to subsist but
to provide a decent life for all". I am not sure of this. It has changed
the character of work, contributed to the race to the bottom and while many
are unemployed, many are working harder than ever du to the growing power
of capital to relocate and thus weaken any legislation . The relationship
between work and wages has always been loose (as eg Petr Jehlička has been
pointing out in his papers). The idea that we will need no more work is
based on not integrating environmental issues into the picture. Like André
Gorz in the 1970s, the author does not realise that automation is built
on fossil fuels, with all the accompanying problems (global warming, oil
peak, imbalance between losers and winners of the race for the last fossil
fuels remaining (Alaska, Amazonia...fracking...). Even information technology
rests on high energy consumption and large electronic servers made from
"stuff".
"The biggest information product in the world – Wikipedia – is made by
volunteers for free." But it does not operate for free, it is supported
by volunteer donations. The problem also is that these volunteers are still
dependent on jobs in presumably capitalist enterprises. This is why it is
so important for the new "commons" and "peer production" to link up with
the old "cooperative movement" to create real livelihoods for these people.
I have an interesting report on this from a conference in 2014 where they
actually did try to link up.
"Yet information is abundant. Information goods are freely replicable.
Once a thing is made, it can be copied/pasted infinitely. A music track
or the giant database you use to build an airliner has a production cost;
but its cost of reproduction falls towards zero. Therefore, if the normal
price mechanism of capitalism prevails over time, its price will fall towards
zero, too....We are surrounded by machines that cost nothing and could,
if we wanted them to, last forever." I am worried that this is the old Western
economic sin of discounting the "material" again: old wine in new bottles.
Information can reproduce indefinitely, true. But all clicking on the internet,
all playing of tunes via computer etc. has a material/energy cost: production
costs of producing the computers, i-pads, mobiles etc. plus the giant servers,
energy costs of operating them, cost to the earth of the waste. Tin, tungstam,
tantalum for mobiles are mined forcibly by near-slaves in Easten Congo in
militia-held territory, illustrating a wider and deeper issue of North-South
imbalance.
"There are, of course, the parallel and urgent tasks of decarbonising
the world and dealing with demographic and fiscal timebombs." This cannot
be done - and thought - "in parallell": Unfortunately (because it is so
difficult), the task is to synthesise our insights from all these spheres
of we want to build a credible utopia. Environmental issues and "trashing
the earth" cannot be relegated to a footnote.
Arthur Robey -> Harry Callahan 20 Jul 2015 01:55
Thank you for your reply Harry, your position is becoming clearer to
me.
I am of the opinion that there can never be enough per capita wealth.
If we drive this argument to extremes then everyone born will have everything
they want and never have to lift a finger. What then the wonders of Calvinistic
industry?
I see that you expound the virtues of the lessons of history. But that
is precisely what is being argued against. Our predicament has no precedent.
History can teach us nothing about the way forward from here. Life sets
the exam and then produces the lesson.
An infinitely expanding economy on a finite planet is a mathematical
impossibly. Therefore the problem becomes "How many doublings of the economy
are enough? " Because any constantly growing function will have a doubling
time. If this is not clear to you, may I recommend Professor Bartlett's
excellent youtube video on exponential growth and it's inevitable consequences.
The only satisfactory solution to a problem of infinities are other infinities.
I won't insult your intelligence by spelling out the obvious conclusion.
The results are so clear and so improbable that the only way to convince
you will be to allow you to find them for yourself.
And it requires no redistribution of whatever passes for wealth on this
poor benighted planet at this moment in time.
Deanna St oriflamme 20 Jul 2015 01:39
"To produce people's control over information, you have to have extremely
well-informed and well-educated people, motivated by something more than
their own isolated or tribal immediate gratification."
Like Julian Assange you mean?
I agree, most of the comments above state clearly that lots of people
read the article so superficially and instantly felt compelled to rewrite-it
in their comments almost as long as Mason's without even reflecting at it
one moment longer
You don't sound "uneducated, mindless, self-gratifying, isolated narcissists,
overwhelmed by corporate-managed information who, when not simply pressing
buttons for gratification, take out the failure of videogames and the like
to gratify them on others by committing random acts of self-immortalizing
violence" so are you sure this is what is happening...? :)
Because during the Crusades the people you describe existed already (minus
the buttons and the videogames)
John Muthukat 20 Jul 2015 01:32
WE ARE ENTERING THE POST-INDUSTRIAL SOCIETY
What we are witnessing is not just the beginning of the end of capitalism,
but the beginning of the end of Industrial Civilization itself. From many
unmistakable omens, it can surely be concluded that industrial civilisation
is headed for irreversible collapse; the latest Greek crisis is only just
an overflowing syndrome.
Today there is a deep groundswell towards a strong and cynic awareness
that the world is fast heading towards a no-win-situation from which it
simply has no escape. Many see it as having already started the end without
even knowing it. It is on account of a number of symptoms, not just one.
They seem to convey the message that the world is un-savable, and that the
worst is yet to come. The top votaries on these lines of thinking constitute
the top corporate technocrats among others. It is only that they consider
it as an open secret and an opportunity to plunder the 'sinking ship', as
is evident from the desperate bailout operations by an already bankrupt
global economy.
Recently a new study has concluded that industrial civilisation is headed
for irreversible collapse? According to a report in The Guardian dated 14
March, 2014, a new study partly sponsored by NASA-funded Goddard Space Flight
Center has highlighted the prospect that global industrial civilisation
could collapse in coming decades due to unsustainable resource exploitation
and increasingly unequal wealth distribution. The study finds that according
to the historical record even advanced, complex civilizations are susceptible
to collapse, raising questions about the sustainability of modern civilisation.
For more on this, please read the essay: The Birth Of Machine And The
Death Of Man: http://www.humanfirst.in/
Urgelt 20 Jul 2015 00:24
A comment cannot be an article, so with that restriction understood,
I'll try to keep my remarks relatively brief.
The author misses a few very important points.
1. Information can be fenced, and it is being fenced. While this fencing
runs counter to a human impulse to share ideas freely, it can be enforced.
With guns. And it is being enforced. With guns. In other words, we see not
only wealth concentration, but rising information concentration and control,
as with increasingly draconian intellectual property regimes and enforcement,
national security apparatuses, and criminalizing the possession of information
which 'authorities' may possess, but not citizens. Did I mention that the
defenders of the status quo have guns? Big ones.
2. Endlessly rising productivity due to advancing technology is driving
wealth concentration on a scale never before seen. Jobs, the primary mechanism
under capitalism for distributing wealth downward, are increasingly impotent
to perform that task - because every year it takes fewer people to do the
work required to keep civilization going. The number of people who are 'excess
to capitalism's requirements' is rising, and they are being shoved out onto
the margins. No-one has proposed a path towards replacing jobs as a mechanism
for downward wealth distribution. The world's economists are notoriously
silent on this subject, which is perhaps understandable when you realize
that most of them are serving the 1%'s ongoing wealth concentration; that's
their day job. Speaking vaguely of Wikipedia and cooperative kindergartens
and cryptocurrencies does not identify a replacement mechanism for downward
wealth distribution.
3. The world population is being radicalized, both in response to overpopulation
and in response to wealth concentration (and the increasingly vigorous defense
of wealth concentration). The result is growing instability. The trend is
uneven, but it is proceeding nearly everywhere. Refugee populations are
surging, with no end in sight. Both the defenders of the status quo and
radicals are becoming more brutal.
4. The richest among us are consolidating their grips on governments
wherever they can to serve their interests. It's really quite pointless
to speak of governments acting to encourage the free exchange of information;
they are coming down hard on the side of curbing information availability,
restricting it to the wealthy and their global security servants.
5. The author thinks the sharing economy will quietly supercede capitalism.
That isn't how I see this playing out. Instead, capitalism will shrink as
demand is concentrated where the wealth is. We already have enclaves for
the wealthy. Soon they will be 'retreats.' 'Fortresses.' The have-nots will
be treated with increasing brutality by those protecting their fenced preserves
of information and wealth.
6. The worst mistake the author makes is in failing to see how these
trends will lead us to inconceivable violence. Endlessly rising productivity,
concentration of wealth and increasing radicalization and brutality will
shake the stability of our entire civilization. It's not obvious that it
will not fall.
7. The last mistake the author makes is in defining a too-rigid equation
between information and resources. Factually, resources do have limits,
no matter what you know. For example, marine biologists are predicting that
by 2050, give or take a few years, there will no longer be any commercially
significant populations of edible fish in the world's oceans. A few decades
further on, we'll have harvested all edible biomass; all that will be left
are inedible species like jellyfish. Species extinctions on land are rising,
too, also posing problems for ecosystem productivity and human food production.
No information-sharing scheme can put a halt to this advancing resource
crunch. Combined with rising population, rising wealth concentration, rising
radicalization and brutality, we're in big, big trouble, and I haven't even
mentioned what climate change will do to us. Starting up a free kindergarten
makes not even a tiny dent in that problem.
Conclusion: at this juncture in human history, it's ridiculous to be
talking about utopian visions. We should instead be talking about preventing
a Malthusian die-back.
WeeWally wiz99doz 19 Jul 2015 23:29
Capitalism finished a long time ago; if it ever existed. The use of capitalism
as a synonym for greedy business is a sad commentary on the lack of language
of our day. Capitalism is about capital formation and nothing to do with
the ripping off of the masses. That's the role of religions and politicians
who encourage everyone to work harder and accept their lot.
Capitalism is an idea born out of Protestantism. If I forgo pleasure
today I will have more resources and therefore I can have more pleasure
tomorrow.
Business is a simple matter. Find something you love to do and help as many
people as possible. They will then throw money at you. Today's businesses,
particularly financially based businesses and miners, do not seem to understand
this principle and are hell-bent on destroying society and the planet so
that they can be the richest survivors. They become rich, briefly in most
cases, but never wealthy. Wealthy people do not spend their lives accumulating
the riches of the world at the expense of others and there is never enough
for the rich but non-wealthy. e.g. How much money does a man need to have
before he shows his mother or father, "What a good boy am I?" Wealthy people
share their wealth uplifting others and making themselves happy through
their good hearts.
No country that has raised itself from under-developed to developed country
status, has done so without the exploitatuion of others. We are seeing this
process copied once again in Russia, India and China. India is the most
disappointing because their peoples claim to understand norality. Accumulation
of capital in developing countries is chiefly through corruption which is
why The Party turned a blind eye to it for so long. Now that most of the
Princeling families are rich they will prevent others following their methods.
It's also a great way to get rid of rivals.
Britains think that the Industrial Revolution made them rich but the
capital was obtained through slave trading and narcotic sales. The Yanks
are so stupid they believe that their revolution was about taxes and not
ripping off Native Lands. Capital was further acumulated by the Robber Barons.
Australians similarly stole the land and the Chinese have stolen from their
own people and now everyone else who is naive enough to trust them. Russia
developed at the expense of desperate and innocent workers who gave up their
share certificates to devouring oligarchs.
Britain refinanced the world by buying supplies from the Carpetbaggers
and ending the Depression in the US. At the end of the war the US had the
only factories still standing so used its financial power to enslave much
of the world and create two empires: Their own and Stalin's. Britain has
only recently escaped its clutches which makes one wonder how it got conned
into Middle Eastern adventures. The US has more standing armies than Rome
ever dreamed of but has sold its soul to the Chinese for a few pieces of
silver. Coincidently the UK also sold out to the Chinese for silver in exchange
for opium. The recovery of Hong Kong by the Party had nothing to do with
land and was all about silver and face.
Long live capitalism; the real kind.
Steve Craton 19 Jul 2015 23:26
I just graduated with my BA ARCH and B ARCH from architecture school
which (mine was, anyway) a hotbed of progressiveness in the name of sustainability
and the fact that somebody is going to have to figure out where and how
all these humans who won't stop having babies are going to live in a future
Earth that may make the movie Mad Max look like a bedtime story. I'm also
a card-carrying Democrat with the occasional Libertarian tendencies - for
example, I think banning legal firearms will be as effective as the current
ban on recreational crack and heroin use, so I disagree with my gun-control
pals on the issue.
All that being said; there's never been true capitalism - or true communism
or socialism, for that matter. What's bandied about as the "free market"
by so-called pundits (usually on a global corporation's payroll) is more
the machinations of a bunch of international Zaibatsu. I'm formerly military
who went to school after service and did a stint in the private sector,
viz, I'm not a starry-eyed kid anymore - but I decided that not only will
I use my education and skills to do the kind of small economy things the
author discusses, I will also pull a reverse John Gault and let the sociopathic
corporations do their thing without me.
Raytrek Raytrek 19 Jul 2015 23:01
Communism has a Capitalist economy, the difference is in how it is regulated
as to where wealth and advantage is distributed, that is a matter of enforced
law and standards on Leadership, Capitalism existed long before Adam Smith,
he just observed the nature of an economy, he even made recommendations
that were not entirely adopted by the Aristocratic authority of his time,
to our current detriment.
Jim Ballard 19 Jul 2015 22:06
Header :
"The end of capitalism has begun"
Long overdue. But technology lending equal access to prosperity for all
on the horizon ? Think again.
This article is loaded with wishful thinking and non sequiturs.
"...capitalism's replacement by postcapitalism will be accelerated
by external shocks and shaped by the emergence of a new kind of human
being"
Not quite human, I'm afraid.
"First, it has reduced the need for work, blurred the edges between
work and free time and loosened the relationship between work and wages."
Yes it has. I for one preached the mantra of "Less work, more money !"
back in the late 80s. But there will be a price to pay by someone else.
Always.
"Second, information is corroding the market's ability to form prices
correctly. That is because markets are based on scarcity while information
is abundant..."
Yes. Products that really are scarce are being cheapened further by a
transient collective of shallow speculators who really do not understand
the product. That will change when "quick sale" solutions are made foolish.
This is really nothing new. Just more prevalent.
"Third, we're seeing the spontaneous rise of collaborative production:...The
biggest information product in the world – Wikipedia – is made by volunteers
for free, abolishing the encyclopedia business and depriving the advertising
industry of an estimated $3bn a year in revenue."
...But "information" does not equal "knowledge", and any attempt to assign
the same power strategies to both is premature and silly. "Wiki" still has
a very long path to "knowledge".
"New forms of ownership, new forms of lending, new legal contracts:
a whole business subculture has emerged over the past 10 years, which
the media has dubbed the "sharing economy". Buzzwords such as the "commons"
and "peer-production" are thrown around, but few have bothered to ask
what this development means for capitalism itself."
I'm concerned less what it means to "capitalism" that I am concerned
with the eager constraints on both the human imagination and the displacement
of the individual.
"(2008 crash) produced, in the west, a depression phase longer than
in 1929-33, and even now, amid a pallid recovery, has left mainstream
economists terrified about the prospect of long-term stagnation. The
aftershocks in Europe are tearing the continent apart."
No. The '29 Depression lasted much longer...Up until the war, in fact.
A "coincidence" not unnoticed by all.
"...the retirement age is being hiked to 70...Services are being
dismantled and infrastructure projects put on hold."
There is only one reason "retirement" is being hiked to "70". Trillions
of tax dollars are being dumped into the war machine. The government is
slowing weaning itself off its obligations to both SS and infrastructure
for that one fact alone. Period.
"Information is a machine for grinding the price of things lower
and slashing the work time needed to support life on the planet."
A little hyperbole can go a long way I suppose, but doesn't address all
the reasons for price deflation while the dollar remains severely inflated.
"Something is broken in the logic we use to value the most important
thing in the modern world."
Yes. We are broken.
"The great technological advance of the early 21st century consists
not only of new objects and processes, but of old ones made intelligent.
The knowledge content of products is becoming more valuable than the
physical things that are used to produce them"
This article would be more coherent if there was less word salad :
"Intellectual"..."knowledge"..."data"..."information"..."imagination"...all
mixed, conjoined, exchanged...trumping any reference to real definition.
Typical econo-speak.
"This will be more than just an economic transition. There are, of
course, the parallel and urgent tasks of decarbonising the world and
dealing with demographic and fiscal timebombs"
How far do we take "decarbonizing ? Effects of climate change notwithstanding,
silicon based intelligence(s) will soon recognize that carbon-based humans
are toxic in themselves, and the utilization of such "wasted" matter and
energy can serve a better end by furthering the survival of silicon-based
new species.
[ continued ]...
Jock Campbell -> Says Aye 19 Jul 2015 20:26
Except the problem we have today is NOT Capitalism. Far from it in
fact! We are in Neo-Corporatism and have left Capitalism in the past!
We need to get BACK to Capitalism, as it was a mechanism for spreading
CAPITAL throughout the system, a method of facilitation from grass roots
up! Today, the capital is held among too few corporate institutions, organisations
and individuals and the net effect is the strangling of the free market
economy... as there's no
Angelo GG 19 Jul 2015 19:39
Post-capitalism, State Capitalism, Kleptocracy, Corporotocracy....
All different words describing the same thing: a bastardization of the
concept of 'capitalism' whereby dictators/tyrants take-over a system of
government in order to transfer power from the many to the few.
It doesn't matter how many fancy economic models and theories are put
forward. There is only one reality in which the powers at be ARE NOT interested
in creating world prosperity, improving standards of living and finding
peace etc etc....
All of that is smokescreen - the real goal is chaos, disease, injustice
and servitude for the masses.
Postcapitalism, or The Rise of the People of Middle Earth.
You can't see them, but you can ear them digging the network of tunnels
under the citadel of power (of value creation) that eventually will collapse
the city walls and come to life in the day light. Well, except that I'm
not convinced that the elements Paul Mason is putting on the table are sufficient
to push society over the threshold of class formation, of a new hegemonic
class based on an alternative way of production, of value creation. The
intuition is there, and I'm prepared to suspend judgment till I read the
all book. In the meantime:
1) It seems to me that in history, the 'dominated' classes never managed
to acquire a sustainable level of control to implement a radical change
of the system. The serfs did not overcome the aristocracy; what toppled
it was the ascent of a radically new class, the merchant/capitalist, brought
about by linear cumulative changes that reached at a certain point a critical
level or threshold. The Russian Revolution did not bring about the hegemony
of the working class, but merely an alternative state capitalistic class
of bureaucrats. So, no system change there, I'm afraid; which is the deep
reason behind that failed revolution.
2) In order to start up and curry on real radical social and economic
change, it seems that the political struggle between the dominant and the
dominated classes is almost irrelevant. What changes history, economic
systems and social order is something more profound, cumulative, and very
much 'out of control', unplannable: class formation, that is, the formation
of a new 'third excluded' social class, brought about usually by demographic,
technological and other changes in the ways of production, that gradually
transforms the economic system, the modes of production, the creation of
value, engendering a completely new (previously not existent) class with
the hegemonic clout and power to substitute the previous dominant class
and reshaping the relations with the dominated classes.
3) The Gramscian 'classi subalterne' do not do radical change nor
lasting revolutions. They cannot topple the dominant class, nor can
create a new way of production from scratch. I think Marx went against his
own analysis and, by introducing platonistic elements, hoped that social
and political struggle would have eventually created a new way of production
and social relations; even according to his analysis, in this fundamental
aspect of his tought, he got this story upside down: it is the economy,
stupid!
4) So, yes, Paul Mason is, according to my watch, on something interesting,
but the mix, the cocktail elements he has presented so far are not original
and are not promising. Lets see...
SuperfluousMan 19 Jul 2015 15:51
The capitalist system is not fighting with the sharing economy - no free
market economist wants to shut down Wikipedia because it doesn't generate
profit. I am very much pro capitalism and I'm very much pro Wikipedia -
I am also pro being able to watch thousands of hours of lectures from the
likes of Harvard University on Youtube. The fact that Google make a tiny
profit from the data I produce whilst educating myself for free does not
bother me at all. It seems to elude some people though that the primary
driver for the social good that is free educational videos on Youtube is
profit (Youtube was created for profit, it was sold to Google for a huge
profit) - and there's nothing wrong with making profit.
I think the author is right about a few things, like how our economy
will move towards smaller and smaller margins as competition and technology
drives ever more efficient production lines, leading to more and more abundance
of everyday goods - but it is capitalism that is driving these efficiency
gains, not some form of neo-Marxism...
SuperfluousMan durable13 19 Jul 2015 15:40
I run a smallish website which gets about 20,000 visitors per day. I
save various analytics from the site in my own database and externally.
I use the information to generate a small amount of profit from advertising.
I own that information - the actual benefits of it are transferred to my
bank account every month - I'm really not delusional.
alturium 19 Jul 2015 15:23
It's hard to see the walls of the bubble when you are inside the bubble…
We talk as if we have a society that reduces work by the increase of
information technology. That the direction of progress points to a heavily
automated society where no one works and the biggest social issue is the
fair distribution of the fruits of mechanical labor.
The virtual reality has become far removed the physical reality. The
physical reality is the limitation of the resources that can grow, sustain,
or maintain our lifestyle. There are limits to growth and we live in a world
of diminishing returns.
We are living in one of the greatest bubbles of all times, the Great
Industrial Bubble economy based on cheap fossil energy and cheap debt. Actually,
there are many little bubbles such as the Finanicialization bubble since
1980, but the Great Industrial Bubble is the big one. I rank the bubbles
by size: Industrial, Cheap Debt (since WWII), and Financialization.
Two hundred years ago about 95% of us would have been farmers. Today
that is less than 5%. Is that because of our liberal democracies? No. Is
that because of capitalism? Not really. The real basis for our complex societies
is cheap fossil fuels.
Our society builds complexity based on the leftover energy surplus of
cheap fossil fuels. We have jobs that are far less menial and far less physical
thanks to this one-time gift. Our economy fits within the natural world,
not the other way around.
When Mason says,
"Once you understand that information is physical, and that software is
a machine, and that storage, bandwidth and processing power are collapsing
in price at exponential rates, the value of Marx's thinking becomes clear.
We are surrounded by machines that cost nothing and could, if we wanted
them to, last forever."
He is deluded. It is a delusion that increasing automation (read: complexity)
can be supported without an increase of energy. He doesn't understand entropy
or the 2nd of Thermodynamics. The illusion of automation is concealing the
fact that our economy is based on cheap energy.
It appears that you can copy music track and play it for "free". But
the reality is that a lot of energy went into building your iPhone. Cheap
coal and cheap labor in China built that iPhone so that you could listen
to that music track. It is not free.
Conventional oil peaked in 2005. Well, okay, effectively plateaued.
We'll probably see the ultimate peak this year. We haven't reached peak
debt…yet. What happens when we reach peak energy and peak debt? What happens
when we reach Peak Everything?
I really don't know. But the past growth and collapse of so many civilizations
that overshot their ecological foundations is not comforting. We are headed
for big trouble.
GeoffroydeCharny 19 Jul 2015 13:42
Welcome to the new Feudalism. The new ages wealth gap and its continued
acceleration will ensure the cementing of the new serf class. The next big
step is their elimination through malnutrition and disease. This will leave
our little blue planet in the hands of a few million well to do and their
robot servants. The environment will recover and the future will be secured.
Bruce Joseph 19 Jul 2015 12:58
Ambrose Bierce Devil's dictionary sald, "Liberty, n, One of imaginations
most precious possessions The rising people hot and outof breath, roared
round the palace " liberty or death", If death will do the King said, let
me reign, you'll have I'm sure no reason to complain "
Richard Alan nolovehere 19 Jul 2015 12:35
Some system has to provide or allocate the basic resources e.g Electricity,
raw materials, foods, land. In addition, law enforcement will be necessary
to stop free riders destroying the system. The people running the system
will always have power over those who don't.
Whether or not people can share information freely, or there is a circular
renewable economy is moot. On this planet; land is finite. Raw materials
are finite. Arable space is finite.
My point relating to Saudi Arabia or the Gulf economies is simple. Labour
is the great bargaining chip of the masses. If you can't provide that or
it isn't necessary, but you take up land, material and food; you will be
viewed by the power-holders at best like the average Venezuelan, UAE or
Saudi Arabian citizen. At worst you will be viewed like Native Americans
or Aborigines 'wasting' space.
And I strongly recommend Michael Manning's 'Spider Garden'.
Rex Newborn 19 Jul 2015 11:50
Every living organism on earth, including humans, competes with others
of its kind, and against forces in its environment for survival. Humans
have the ability to modify nature to some extent, but can they ever really
control it, especially their own nature? Capitalism has been in existence
since the first IOU was created, and will continue in some form unless there
is a quantum leap in the evolution of human nature. Capitalism is the essence
of human competition, as territoriality is among mammals.
Equality does not exist in nature. The only way that humans could ever
possibly be anything approaching equal would be for all humans to be alike
and to think alike. Mass cooperation among humans only happens in dire emergencies,
such as wars, riots, epidemics, natural disasters, etc.; or, by force from
some form of heavy-handed leadership, mass political indoctrination, forced
religious adherence, marshal law, etc.
Overpopulation threatens a dire emergency on a global scale. If we are
to have a redistribution of wealth and an environment where umpteen billion
of us can survive, we will probably have to have a socialist government.
A dictatorial, tyrannical, socialist, world government that ruthlessly forces
everyone to share equally, at least as long as there is anything to share.
Those that rank higher in this government, possibly the top 1%, can expect
to be a lot more equal than the plebeians, of course. Those in the top 5%
of government can expect to be somewhat more equal, and so on.
ID8598806 luizribeiro 19 Jul 2015 11:45
Brilliant, seductive ...but devoid of realism ... Neither the plutocrats,
nor the digital monopolies nor the meritocratic dictatorships (let alone
the kleptocracies) will fade away. The logic of collective action decisively
proves that the well endowed, well organized few invariably control the
many. Local initiatives facilitated by the new information technologies
will be tolerated in order to let off steam...but only up to a point. The
powers that be will remain ruthless in controlling access to these technologies
and in suppressing any challenge to their control of the commanding heights.
Thus rather than post capitalism we are at the threshold of Capitalism 3.0
Bob
Lawrie Griffith 19 Jul 2015 10:41
It seems to me there is one important factor that has been overlooked
in this article. The link between economic growth and population growth.
Current economics appears to be sustained by growth. Growth in consumption,
growth in money, growth in debt, growth in productivity by lowering wages
and living standards, growth through speculation, growth in asset inflation.
It's a long list.
This is all underpinned by growth in population.
But in many regions of the world this is slowing, or has even stopped.
For now migration from poorer countries to these regions is maintaining
growth and demand, along with cheap labour.
However, advances in education and local access to knowledge through
modern communication is working in tandem with increased health to empower
women. This reduces birth rates, as having fewer children becomes a better
form of security and opportunity than having large families, because more
women are able to regulate their own fertility.
Continued growth through post-capitalist information wealth, which expands
in cyberspace, is a pathway forward as the author suggests. However, neoliberal
capitalism requires steady growth in consumer spending to maintain stability.
As population growth slows old style capitalism will come under strain.
The knee-jerk response is to impose Austerity on the main population
to maintain the growth in wealth flows to those at the top. Everything we
see in the world today suggests that the big institutions of the finance
sector will will do everything in their power to maintain capital and liquidity
churn and flows in the money markets.
As population growth slows and environmental change undermines economies
and wages fall, the bottom, as they say, will drop out of the neoliberal
consumer market.
So I ask: is the author suggesting that the rapid expansion of non-comodified,
free, networked information can replace the coming stagnation in consumer
demand, which is transacted in money? I like the idea, but if so: how?
Elinor Hurst ABCgdn 19 Jul 2015 10:26
No, the freedom to own stuff if you happen to have enough money to have
that freedom, does not mean that those with that money and hence power will
have the intelligence, understanding and foresight to take steps to address
environmental problems. This is partly for the reasons StefB1 has mentioned,
that very few people seem to see the joined-up picture in this highly complex
world of myriad specialisations that we live in. It's also because there
are so many interactions in the global socioeconomic-ecological system that
it's not necessarily intuitive and easy to predict what will happen, even
if your eyes are open about environmental risks. And then, why would someone
invest money in solving an environmental problem that isn't costing them
money in the here and now? The impact of production is so often geographically
distant, diffuse, and not immediately obvious - sometimes it takes many
years of science to prove a connection - and by then the original investors
are long gone or pass the buck to someone else, often leaving governments
to regulate and invest in scientific research to fix it.
40 years ago the Limits to Growth study was published, based on a
systems dynamics model of the world's population, economic production, resources
and pollution, and how they would interact. It forecast the sort of trouble
we are now seeing, and its "business-as-usual" scenario predicted system
collapse in the mid-21st Century. Governments and society leaders should
have taken note back then, but they didn't, and their behaviour shows how
poorly "capitalism" does rise to the challenge of global problems - it obfuscates,
it denies, it defers, and it goes on doing its own thing regardless in the
face of all evidence that it is on a path to destruction. Now we are left
with a world that is consuming the equivalent of one and a half planets
a year, and still, many are in denial.
Those of you who have infinite faith in technology and capitalism's ingenuity
to save us don't get it - the scale of the problem is just getting too big,
and the amount of time, effort and resources needed to be thrown at it in
the time needed to prevent runaway climate change and ecosystem collapse
is too short to let entrepreneurial tinkerings meander their way along to
bit by bit solutions.
Cafael Spoonface 19 Jul 2015 07:15
But taking the long view, I think there may be no neo-liberalism or even
free-market capitalism; these are narratives to sweeten the reality of elites
re-establishing dominance after a long period of change and of the physical
expansion of industrialised society - power consolidation, after limits
or barriers to that quasi-colonial expansion is reached, leading to reduced
opportunity and re-emerging aristocracies.
Progress can no longer be seen as inevitable; an active political choice
must be made to establish consistently humane principles. So far, attempts
such as the American Constitution, the unwritten ethos of the post-war settlement
and the E.U. have been successful but gradually undermined, in part because
they were not sufficiently internationalist or understood by the people
in terms of relevance to daily life.
Political participation and broad political education is essential; I
am amazed, for example, that schools don't teach the form and history of
our political system as a foundational aspect of citizenship.
It sounds hopeful that economists are questioning the assumptions
of neoliberalism, but if, as I suggested, the real change is less ideological
and more to do with elites preferring to be elite even if in poorly functioning
economies and dysfunctional societies, these criticisms may be ignored.
Anyway, if we get Jeremy Corbyn and Bernie Sanders, perhaps then we'll
see! But it's up to everyone to keep making and refining the arguments,
and to get them across. I think even the most indoctrinated people can change
their views very quickly when they encounter good sense.
Cafael Spoonface 19 Jul 2015 06:46
But what they fail to notice is that neoliberalism is itself an imposed
vision.
Yes, that has always been a difficulty in politics and indeed thought:
those who were born in the sea don't know that there is such a thing as
dry land, or even such as thing as the sea.
They are just as reductionist as communists were in defining humanity,
as you say, 'economic man', and ordering society to fit that definition
rather than allowing that definition to be fluid and continuously empirical,
revising and transcending expectations.
Yes, the slave trade and colonialism in general killed more, and destroyed
entire ethnic groups. Capitalism often boasts that it kills fewer of its
own, for all that is worth.
Spoonface Cafael 19 Jul 2015 06:00
In fact, if we consider the arguments of neoliberal thinkers,
they consistently speak and act against any kind of imposed vision,
partly due to their belief in the nature of the market and partly because
of the violence and upheaval that fabricated and imposed ideologies
have caused
But what they fail to notice is that neoliberalism is itself an imposed
vision. As an economic stance it ultimately rests on neoclassical economic
ideas, and through those a set of philosophical assumptions; and neoliberal
economists, being poor philosophers, are loath to investigate these assumptions.
There is now a growing raft of critique - some actually from pro-market
economists - criticising the assumption of 'economic man' as a being with
perfect information, perfect rationality and perfect freedom. This construct
is the concept of human personhood which underlies neoliberalism. From a
philosophical standpoint it seems bizarre that these assumptions need questioning;
they're so far from the truth it beggars belief that anyone with a functioning
mind would entertain them.
Neoliberals also tend to ignore the violence of capitalism; the slave
trade killed more people than any planned economy.
Althnaharra 19 Jul 2015 02:09
Scrolling through this thread, Steinbeck's quip comes to mind; that "America
is a nation of millionaires who are temporarily down on their luck". This
is why libertarianism has such an appeal to the under fifty crowd and why
so often the commentary surrounding these issues must be glib. It has become
gosch to be concerned about assembly line workers and others who don't or
can't live beyond their means, buying labels they can't afford, throwing
huge wads of cash at repairing their older BMW, or going for the pricey
bike and skis. Social media has accelerated what has become a miasma of
pretense, that reinforces illusions and protects from harsh realities, a
uniquely insular social gathering place, incubated in academia and now expanded
into mega jerk with 401K.
entropy_is_a_hoax 19 Jul 2015 00:26
A point not made is that a lot of the information is worthless or worse.
Exabytes of cat and dog videos. People oblivious to the real world, wandering
around looking at and listening to their iWhatevers, exchanging inconsequential
trivia with their eFriends, with no interest in what is happening to our
society. Unlike the current war on us by the Neo-liberal elite, social media
was not a conspiracy but has arrived at a perfect time for the elite. A
distracted and apathetic population who will do the elite's bidding as long
as they can afford the latest iWhatever and designer clothing. It will be
interesting to see what happens in the Anglophone world when KR Murdoch
dies, his control of information has greatly facilitated the Neo-liberal
elite's ascent.
permaguy alturium 18 Jul 2015 23:03
Dissipative systems are also far from equilibrium. Neo-classical economics
was theorized that the economy was in equilibrium, whereby the system would
lead eventually to equality. Of course, exactly the opposite has happened;
the system has lead to inequality, because the economy isn't based on physics,
it's based on a story we've been telling ourselves, Alan Greenspan's post-bailout
testimony to the U.S. Congress is telling. Humans are also not so rational,
we think in metaphors and frames all the time. By seeing everything through
a machine metaphor, we have created a machine over nature, which is not
sustainable.
lturium NadNavillus 18 Jul 2015 22:58
Lol, sorry for sounding so "doomish" :-)
Your right about leaving out climate change (or AGW), I subscribe to
the view that most of the reminder of the fossil fuels will remain in the
ground as un-economical to retrieve...post collapse.
Our response to climate change is pretty frightening. Gail Tverberg just
had an excellent article showing the vast increase in coal by China after
the Kyoto Protocol 1997 (and inclusion to WTO in 2001). 70% of China's energy
comes from coal. Isn't that ironic that a treaty to reduce CO2 actually
increased it? We have effectively offloaded pollution for producing our
iPhones and Solar PVs to China...
Okay, now is a good time for a Matrix quote:
The Architect: You are here because Zion is about to be destroyed. Its
every living inhabitant terminated, its entire existence eradicated.
Neo: Bullshit.
[the monitors respond the same]
The Architect: Denial is the most predictable of all human responses.
But, rest assured, this will be the sixth time we have destroyed it, and
we have become exceedingly efficient at it.
No, government did not "get in the way". Rather the opposite, it got
OUT of the way and let wealth became the dominant power. Then wealth self-regulated
by buying our politics and politicians and rigged the game for the elite.
Neo-Liberalism and Libertarian thinking took control of the US and then
invaded Britain and the EU. Even Finland is starting to sound like US Republicans.
Tornike ID7751075 18 Jul 2015 21:19
On the contrary, my points are what the Left are learning today and what
is a working alternative (see Mondragon for instance) unlike playing political
games with the neoliberals with horrible results we see year after year,
the most recent just concluding a week ago in Europe.
alturium 18 Jul 2015 20:24
Ironically, your ideas presented here are dangerous to our future, even
if your intent is sincere.
Instead of creating a new human society of work, leisure, and wealth,
you are laying down the intellectual foundations for neo-feudalism. I can
imagine the future and the difficult transformation ahead for all peoples,
but I would like to avoid a return to the feudalistic or slave-based societies
of the past.
Those repressive societies existed because of the lack of cheap energy.
Athens may be the birthplace of democracy, but 90% of its peoples were slaves.
On the contrary, it is the largesse of cheap fossil energy that has enabled
our modern society with all of its external frailties. Add on exponential
cheap debt (money/energy from the future), exponential population growth,
diminishing returns, pollution, etc. and we have quite the cocktail for
tomorrow's total and final global collapse.
Your article is a carefully crafted statement of more control by the
government by establishing a religion of ideas, very similar to the communism.
Communism subsisted on convincing the people of high order ideals that were
carefully cultivated by elite. By controlling the perception of morality,
they were able to take advantage of people's natural herding instincts.
All human societies are based on a social hierarchical system.
We must, instead, come to understand why we are violent and why we form
societies that exploit and why we subjugate the weak. To understand those
answers will require a deep introspective examination of our genetic and
biological foundations. Such an examination is not possible today, not in
a life where each of us is supported by 100 to 300 energy slaves. It would
be like a Roman Caesar sitting down to contemplate the life of a plebeian.
In grand irony, the traits that make societies successful are the same ones
that bring about final and total collapse.
It will be the task of future generations to ponder such deep questions
amid the ruins of a post-industrial society. Most likely, there will not
be another grand and complex industrial society because we will have exhausted
the most wonderful energy source, fossil fuels, within a short time period.
That is, in the timespan of approximately 300 years we have economically
exhausted what took 300 million years of sunshine to create.
Tornike 18 Jul 2015 15:35
If I am right, the logical focus for supporters of postcapitalism is
to build alternatives within the system
Exactly the point I was making in conversation with two of my friends
last night during a techno event in a club (yes, I know). The new Left idea
needs to involve beginning with creating alternatives (worker owned co-ops,
etc) that will inspire people to continue the chain of the transformation
in their workplaces, families, etc. Political campaigning and competition
in a system that is built for and benefits conservative/neoliberal structure
of discussion, media and lawmaking is just not fit for the purpose.
Iwasjustgoingtosay 18 Jul 2015 15:19
Capitalism as we've known it is surely going down the pan. That's not
news. But what will replace it? It seems like we're already entering what
will turn out to be a rather long, painful period of something akin to neofeudalism.
It's gonna be a long way down before capitalism finally hits the skids,
and the oligarchs aren't going to throw in the towel just like that. And
once we get there, it's going to look more like 'Riddley Walker' than Bartering
Bliss.
Kyllein MacKellerann 18 Jul 2015 13:45
Where Post Capitalism seems to consider that we are entering a Utopian
age, the sad fact is that NO Utopian system has ever worked without systematic
oppression. Communism is an example most people are familiar with: yes,
it works provided that a secret police is available to deal with those who
won't play the game.
What we have here is an Economic system that, like Communism, is trying
to be either a Social system or a Political system. Never mind that there
has never been a successful conversion of any Economic Systems into Political
Systems, not one.
Socialism is at heart a Political system, hence it works to a degree,
but only to a degree. For that matter, Capitalism only works to a degree
(actually about as well as Socialism).
One of the prices of political freedom is inequality, you can't get away
from it. Some people will by chance or by nature do better than others.
We see this in the wildings, animals who are generally indifferent to political
systems: some do better than others. Enforced equality necessitates the
demise of freedom, since freedom will engender inequality. Reference to
North Korea: a state with enforced equality (that fails miserably).
Politics is an outgrowth of human nature. Understand this (and the author
plainly doesn't), and you have a chance of developing a political system
that will work for a while. Ignore the fact it looks a very great deal like
Capitalism, please.
Michael Katsak -> MarsPLuto23 18 Jul 2015 11:19
While it might be true that people rarely ever give up power, you should
consider that people very frequently LOSE it. The article mentions that
the only model we have for transitioning between world systems is the death
of the Feudal system. Absolute monarchs, religious oligarchs, and merchant
guilds all LOST power every bit as real and substantial as the ruling class
of neoliberal capitalism. Whatever future we are able to realize, make no
mistake that we ARE in the midst of a profound change.
The goals of India,china,russia or other Asian countries is motivated
by Nationalistic agenda,with rapid deglobalization & self reliance.
They consider Brain drain as evil....as the productive populace which
they lost should have paid taxes in their home country & built their capability
& contributed to more social cohesion.So if you read a little bit of History
you know they discouraged intercourse with others.
All those communism,capitalism,socialism,leftism,rightism are not things
which they understand .They understand only one thing what is right for
my Nation & my Nation's friend that alone should guide our intercourse in
our dealings. Overtime they know their Nations are 6000 years old & their
greatness was only briefly interrupted by circumstances. Self sacrifice
is the most important quality they demand from their citizens & not economic
glory but glory of their Nation.
RobertLlDavies snootyelites 18 Jul 2015 11:02
So the selfless efforts of millions of communists around the world in
defence of workers, women, students, national liberation, democratic rights
- from Iraq, Iran, Chile and South Africa to France, Swaziland, Egypt and
India - is "mass murder"? There has been much more to the communist movement
across the world than the the major crimes of the Stalin period in the Soviet
Union. According to this childish level of argument, I could argue that
the goal of capitalism is slavery and the slave trade, colonialism, fascism
and death squads. Grow up if you want to take part in adult discussion and
debate.
demandflow MarsPLuto23 18 Jul 2015 10:48
MarsPluto23, what happened to that great British concept "the presumption
of innocence?" This Golden Thread of Jurisprudence was carried across the
Pond to America. I learned this phrase from the television series "Rumpole
of the Bailey".
A "despicable way of life" is an interesting phrase. Who decides what
is despicable and how or if it should be punished. Will the term change
with the weather?
As far as the bankers and leaders are concerned, it is OUR fault that they
are able to do what they do. What politicians and bankers do you prefer?
ramous ID5955768 18 Jul 2015 10:04
The point I have been making is that religious fundamentalists like neo-liberals
can't see anything but their own dogma. You are an being an example that
dogma.
Vijay Raghavan 18 Jul 2015 10:03
It means driving the wages, social wages and living standards in the
west down for decades until they meet those of the middle class in China
and India on the way up.
To answer question of wages what caused western wages to grow up more
than China/India.When did the western wages go up & what caused that rise
in their wages.This also has to be answered when the Ambassador of west
went first to India in 16th century he was dismissed saying you come from
a small pond what are you going to offer to my kingdom those words of Jahangir
was repeated even by the chinese emeperor to them in 17th century.
The rise of wages in a economy is dependent on Gross value ADD in manufacturing.At
the moment east asian economies have 32%,India 17%,West,Japan between 12%-22%.In
18th to middle of 19th century the gross value ADD of western economy was
about 40%++.
What drives gross value ADD is Process industries,technology,brand,scale
of market,etc etc.Process industries which makes up 40% capacity like steel,aluminium,coal,mining,petro,refining,fertilizer
they all need capital,operational efficiency which east Asia built it up,India
also is building it slowly.That is where european edge went off in Manufacturing.They
have to rely on exceptional technology,design,brand,perception to lever
up their Nation to get share.The european cos play there is getting shrunk
since US,Japan,Korea,China have all ramped up.
One nation can't drive down the wages of another Nation,only when you
lever up ability of a Nation to give a product to entire world will the
wages of Nation goes up.Like UK has banking industry since the entire world
wants to route their banking transaction,commodity buying,investments etc
etc through that route.So the wages in Banking will be 5x than India/China.If
china builds scale in Banking the world routes their trade in Hongkong,Singapore,Beijing
there will drop in volumes in London with corresponding wages loss.So overtime
china will acquire the capability in product,brand,reputation,legal,all
other skills.
The west if it wants to drive up its wages it has to model a perfect
mathamatics of determining what is %age of population to be deployed for
each of the industries in Manufacturing,Services,Agriculture to get the
right equation of wage growth & living standards.
If they go to do that ....their experience has been bad of being in dark
ages of 1000 years or like how Jahangir/chinese emperor treated them you
are not important for me.
European wages will hinge upon how much market access both china/India/Asean/US/Russia
or other nations keep giving to them.But the accusation of wage depression
because of them will lead to more trade problems for west.
If the political/media equation of west with those countries improve
they will rather than depressing your wages will keep levering more wages
for west.
Francisco Güemes 18 Jul 2015 09:07
Wow what a piece of Marxist, collectivist, new age/New World Order piece
of article!! Bravoooooo!!! As the marxists failed with their Russian experiment
in the XX century, now they want to bring us their "post-capitalist" concept
based on what is going to happen after neoliberalism (which is as collectivist
as marxism-lenninism) fail. Well there are going to be many of us..ready
to fight the new world order!
Kuttappan Vijayachandran 18 Jul 2015 08:59
The article and the ongoing discussion reminds of the great Soviet poet
Mayakovsky, and his classic play, The Bedbug, written for the first anniversary
the Bolshevik revolution of 1917, described as landmark in the history of
Soviet theater, and staged numerous times within and outside of USSR, during
the Stalin era. Mayokovsky created in this play, a prototype of what is
known, today, as social media network, in order to debate and condemn the
Bedbug and the exploitative character of the species. nullhttp://www.wordpress.kvijaya40/
dutchview Fabio Venuti 18 Jul 2015 08:54
But current Capitalism is really about creating artificial scarcity so
that you can then push the price up and rip off the "customer".
The article is interesting, in the early 1980's I was one of the first
in my international company with a PC on my desk, it had 128kbt total memory
and was rubbish and a total waste of time. But today in the western world
workplace we are surrounded by all manner of clever integrated devices with
multi Gbt of memory, plus oodles of extra Tbt up in the cloud. Has my life
got easier? Have I got more free time? Have we made progress? Well the answers
are No, No and not much, or may be we have actually gone backwards.
In the last 30+ years mankind has totally wasted the benefits of the
"digital revolution" and done untold damage to the planet to boot. It is
certainly time to change to a new chapter in the book and more of the same
is not the answer. The 1% can not continue to get richer.
Eric Grey 18 Jul 2015 08:46
Did Ted Kyzinski write this from prison? Did anyone else read this entire
exercise in circular reasoning? Invent a term, "post capitalism," label
some current phenomena as post capitalist and therefore not capitalist (by
definition of course), and then use it as evidence that capitalism is on
the fall.
Information can become as abundant as ever, but resources will be as
scarce as we overuse them. Markets are going to mediate the exchange, whether
that's with money or utility (volunteering is not decidedly anti-capitalist).
Greece's coops and informal market systems prove capitalism exists even
in toxic government environments that choke traditional business off. If
you make it impossible for anyone to keep a market open because they can't
get capital, they're going to create coops. That's proof of capitalism,
not evidence against it.
When people write stuff like this article, they demonstrate they have
next to no idea how ridiculously complicated and heavily invested our modern
economy is. You're not going to get a $14b oil refinery or nuclear plant
or drug manufactory from a coop or peer to peer relationships, and governments
regularly demonstrate they are terrible at this stuff.
And monopolies don't get formed "as a defense mechanism for capitalism".
Capitalism isn't a person. What utter garbage. People form monopolies out
of profit motive, not to defend a system. If anything, capitalism destroys
monopolies because higher prices from them form competition and substitutes.
Locus 18 Jul 2015 08:41
Somewhat disappointed in this analysis, Paul. After the demolition of
organised labour and, currently, the co-opting of most media, the state
is the last bastion of collective bargaining power and regulation that the
non-elite can utilise. The "sharing economy" still consists of fringe activities
built on the foundation of standard economic processes.
As for automation, in my own direct experience this merely means that what
5 people did, one person has to do for the same wage. The hope it has brought
has consistently resulted in any benefit being sucked upwards and safely
tucked away in bank vaults with the vast majority of those with "freed-up"
time and more to offer but not slotted in to corporate structures, being
despised or existing precariously.
Michael Q -> britishinjustice 18 Jul 2015 08:08
As Bevan once said about the NHS, that it will go on as long as there
is someone who cares enough to save it, the same applies to capitalism.
I really can't see all the political powers that support it giving up
just yet, in fact if capitalism is ever killed off, it will not be because
those who support it gave up or surrendered. The other factor in my
conclusion is that there is not yet enough of a revolt against capitalism
from the people.
Some good points made. For a real change to happen it is true it needs
to come from the masses, and there needs to be a desire and hunger for change.
Once this happens it will be reflected in the rise of left-wing and revolutionary
governments to enact changes to legislation / referenda on constitutional
reform / redistribution of wealth etc.
The good news there is massive change currently going on in Latin America,
with the construction of socialism and a post-capitalist society now under
way in Ecuador, Venezuela, Bolivia, Argentina and Cuba just to name a few
(although Cuba is at a different stage than the others, due to the economic
embargo against it from the US). Whilst those countries (and many others)
are unique, with different situations and resources, they are united in
the common goal against neoliberalism and capitalism. This is reflected
in new institutions that have been developed including ALBA, CELAC, Petrocaribe,
Unasur and Mercosur.
Best of luck with your new group - and it may help by linking up with
the left wing groups in Greece, Spain, Ireland and in the Latin American
countries I mentioned.
Cheers.
richardmuu 18 Jul 2015 08:00
Motivated by disgust, I studied U.S. mass media for decades so I appreciate
the Utopian motivation that drives writing and talk of free information,
the digital commons and the internet of things. Offered the chance to think
about a better future vs. a dismal present, who of right mind would choose
the latter?
Yet there is more to consider in the present than has been grasped by
the new Utopians. I offer that not as a criticism because I still believe
in the wisdom of the Book of Genesis--we must struggle to know, and whatever
we know will be flawed because we are not gods. There is a flaw in the thinking
of the Utopians but it did not begin with them. It began instead during
industrial capitalism and, so far, continues to operate: Information is
nothing if no one notices it, pays attention to it. When I read this essay
and considered commenting on it, I noticed that it had already accumulated
2456 comments. I likely will not read more than a dozen or so, and it's
likely that many other who read this article will behave in the same way.
Yes, the production of information is evolving in the direction of zero
marginal cost, but human attention is not. We have to take care of the limited
amount of attention we have each day, and even with the best of care we
still need to go to bed each night and fall into a deep enough sleep to
become unconscious. That sleep replenishes the body but it mostly replenishes
our capacity to pay attention to our world the next day.
What's the big deal here? Only that industrial capitalism commodified
attention and during this period of the emerging digital commons, the practice
grows. The gathering and sale of attention drove the culture industry and
has supported not a little of the innovative work we now see by free-floating
professionals in the digital commons. Many of the technologies of information
distribution and storage would not have happened if great wealth was not
promised to the innovators who would find new ways to capture and sell even
more human attention. Today, the internet is dominated by Google, Facebook
and YouTube, platforms that focus the attention of millions on increasingly
common contents.
What this means is Utopia for some and continued dystopia for the rest,
with capital in a position to wait before it acts next, taking comfort in
its ability to mobilized enough of the rest to keep the Utopians boxed into
their intellectual ghettos, there to innovate in ways that will help capitalists
reduce their marginal costs. Should the Utopians threaten to break out,
to realize amplify the commons in ways that threaten capital accumulation,
then other industrial capital cultural forms, particularly fascism, are
still available as tools of social control.
"Millions of people are beginning to realise they have been sold a dream
at odds with what reality can deliver. Their response is anger – and retreat
towards national forms of capitalism that can only tear the world apart."
There is a lot of anger outside the intellectual ghettos. Who will direct
that anger, and what will its target be?
s1syphus 18 Jul 2015 07:46
This is simply a repacking of the "cognitive capitalism" thesis from
Hardt and Negri's Empire, Multitude, and Commonwealth. It is worth noting
that a number of people, including Silvia Federici, George Caffentzis, Alberto
Toscano, and David Camfield (the list goes on) have demonstrated why this
is wrong in various ways.
I read a comment below on how Mason is acting like any entrepreneur in
a capitalist society: building his brand, producing commodities that satisfy
needs, etc. Given my own view that myths like these do play a useful role
in the production of forms of anti-hegemonic resistance, but also that the
quality of these particular tropes - essentially that the end of capitalism
is on its way, all we have to do is wait for it - is incredibly damaging
to the movements that Mason purports to support, because it encourages people
to do restrict their activities to the periphery of the struggle. Read a
few books, click a few links, but still go to work every day, revel in the
communicative possibilities that your job offers you but give no thought
as to how the character of your exploitation actually makes capital more
enduring, albeit less stable.
ramous -> Andrew Howard 18 Jul 2015 07:05
Neoliberal fundamentalism its called, it's a perversion of liberalism
as is ISIL is to Islam. They have been waging financial war across the world
on countries that do not adopt there fundamentalist view. Greece just ran
into the pointy end of that stick they have been beating everyone with.
ramous ID5955768 18 Jul 2015 06:50
You mean communism not socialism. Socialist countries like the northern
European model were doing very well until the neo-liberals started finacial
wars and targeted any country that didn't abide there new fundamentalist
crusade of wage and worker oppression. Most of the gains that have been
attributed to so call capitalism was in the middle of last century. I think
there are plenty of graphs to show once the thatcherite neo-liberal fundamentalists
took over we have been push into more and more debt and wages have been
decimated.
barrybethel 18 Jul 2015 06:21
Nicolas Nassim Taleb in his last book, Antifragile, talks of neomania
- the fetishising of the new - and offers by counterpoint the rule-of-thumb
that that which is not living is likely to persist for at least as long
as it has already been around - the game of chess, for example.
Add capitalism to that, which even a quick glance at Wikipedia reveals
has been around for some centuries. So is this the end of capitalism? Unlikely,
on that basis.
RoscoBoyle 18 Jul 2015 05:32
Somewhere in my reading, back in the day, I dimly recall the word 'intelligentsia'.
Dim as the recollection is I think the intelligentsia constituted a class.
Jumping forward to this excerpt from Mr Mason's book I wonder why I am reminded
of the word 'intelligentsia'?
Could it be that only those persons who can discount the cost of access
to information consider that information is 'free', or becoming free? When
I read that Mr Mason's paradigm/book is being published by Allen Lane on
July 30 should I presume that I can wander into any bookshop and walk out
without paying for it? And that only because I put fuel in a vehicle I have
bought, taxed and insured to get me to the bookshop - the equivalent of
buying the equipment and paying my ISP in order to purchase the 'book' dematerialised
into data that my pc/tablet/e-reader/mobile phone can reconstitute.
Mr Mason's error, it seems to me, is to confuse the proliferation and
ubiquity of vectors for information with freedom of access to that information.
His historical analysis of capitalism presumes a progress beyond neoliberalism.
What we are living through is, rather, a regression to neofeudalism with
the state regulating and enforcing citizens' obligations to the seigneurial
class.
It has ended. And just a few are noticing it and doing what is needed
to deal with the aftermath of the mess created by the neo-liberal thinking...You
will remember the writer and his prediction. One example of this was when
the USSR stopped giving support to Cuba, which was under incredible economic
stress after the fall of the USSR.
I followed the process and I can tell you it survived. Greece will survive
too and so will all of us once we learn that sharing, cooperation and being
part of the community by contributing to it in a positive manner, is all
what it takes to make the community better.
This is what John F. Nash proved. They talk about game theory lol...it is
cooperation theory. He debunked capitalism individualism big time.
naurdiagreader 18 Jul 2015 03:54
It's true that the information-based system is starting to make money irrelevant
and therefore redundant. It still has a long way to go however and those
of us who don't have much money are acutely aware of the need for it to
buy the essentials of life.
We have seen a huge fightback since 2008 in particular from the wealthy
elite to claw back wealth from those at the bottom in particular, and austerity
has been a tool to do just that. Some countries such as the USA have had
Keynesian injections of investment to counter the downswing but on the other
hand we have had catastrophic failure in the financial system at the same
time. The motivation behind the bailout is clear, but that of the Lehmans
failure is less so. Lehmans was a choice, let us remember, it failed because
of a decision not because of some force of nature. A 'cui bono' exercise
on that decision indicates that the losers in macro economic terms from
that bank folding would be the general public of America and beyond as the
economy faltered, but also that the winners could be corporations benefitting
from the low wages generated by the crash as workers became more desperate
for work in a depressed economy. So why should the financial elite have
paid out their good money on a failed bank when it presented them with a
nice opportunity to reap more on their investments elsewhere?
Hopefully we are now far away from feudalism, but the oppressive economics
of Neo-Liberalism which oddly politicians of all mainstream parties now
seem fixated on (why is that, by the way?) is having a darned good try at
pulling us back to that position which is far from optimal either in wealth
creation or wealth distribution. My hope is that this struggle will ultimately
prove illusory for those wishing to hoard wealth, although there will probably
always be a rich elite even in the most equal of circumstances. Meanwhile,
we have pointless austerity in the UK, and outright oppression very sadly
in Greece. Concentration of money in one place will make trade fail. This
was recognised after WW2, and was a major driver of establishing the IMF
to counter the fact that no-one other than the USA had any money. We obviously
aren't at that pass, global trade isn't dependent on just one country, but
it is being generally suppressed by the economics which tends to suppress
both wages and economic activity. If the people who decided on Lehmans are
still in charge, I don't see a change of heart coming any time soon to revive
the global economy. Life is indeed better with information technology, but
many are still feeling the need of scarce money for everyday living.
PhilPharLap pogomutt 18 Jul 2015 03:24
I think you need to see how the present spoilt privileged group have
been dealing with the problem
They have used the methods of the slave era - accommodation has become
increasingly unavailable everywhere and the demands of a landlord class
have ensured that so much of a man's wage is taken up merely providing housing
and food there is little left to realise his potential as a human being
- That is why so many clubs and restaurants are empty. People cannot even
afford moderate leisure - they are slaves of a low paid work ethic
People are saddled with debt - one sees in Greece a whole nation raped
through the use of loans, which are stolen by the rich and left to ordinary
people to repay.
During Feudal Times many were idle because the Lords simply did not care
if they worked or not - lived or starved to death. Just so long as they
were hung or decapitated if they rebelled or even protested
Most work is totally pointless and is there to keep people off the streets.
Sure there is big problems coming but war and genocide will fix it. It starts
with neo Fascism
And it has started already
davebut 18 Jul 2015 03:13
For over 40 years there has been a gradual transition from the dominant
neo-liberal economic paradigm where economics is king and the environment
is managed for the benefit of today's humans to a more holistic sustainable
development paradigm in which humans are part of a complex interdependent
Earth system.
Annette Schneider 18 Jul 2015 03:01
Project Zero is definitely more plausible than the continuation of capitalism
and perhaps it wil emerge from the shock which is coming to us all, but
I fear that if it emerges it will only be from the ruins of a post-capitalist
neo-feudalism. Like renewable technology and climate change mitigation,
it really should be here already. There are too many of us and we have done
such great damage to the biosphere that we will be hard pressed to even
survive.
"on the ground in places such as Greece, resistance to austerity and
the creation of "networks you can't default on" – as one activist put it
to me – go hand in hand. Above all, postcapitalism as a concept is about
new forms of human behaviour that conventional economics would hardly recognise
as relevant."
I have seen a taste of our possible future at Camp Wando, ( http://frontlineaction.org/
) with the disparate groups involved in the Leard Alliance. I agree with
Paul Mason that,
"It is the elites – cut off in their dark-limo world – whose project
looks as forlorn as that of the millennial sects of the 19th century. The
democracy of riot squads, corrupt politicians, magnate-controlled newspapers
and the surveillance state looks as phoney and fragile as East Germany did
30 years ago."
but still I despair of such Mason's rosy prediction given what I can
see is the utter resistance to reason and the lack of effort required for
change.
I fear that the words of Alice Friedeman, 2006 http://energyskeptic.com/preservation-of-knowledge/
are a truer guide to the future,
"Preservation of knowledge needs to start immediately, while nations
are still stable and wealthy. Now is the time to consider how to preserve
knowledge with a material that won't decay, rust, mold, or shatter easily.
We should leave our descendents knowledge they can use and be amazed by,
information to fuel the next Renaissance."
I believe that the next Renaissance will only be after a period of time
to rival the dark ages rather than through the smooth transition envisaged
by Mason. The quicker we can give up fossil fuel, particularly coal, tar
sands and fracking the less time it will take for peace and stability to
emerge, because despite our wonderful technology, there are no shortcuts
in dealing with climate catastrophe and we are in for a very rough ride.
bemusedbyitall Sammykins 18 Jul 2015 02:57
By the Australian Liberals I take it you mean the ALP and the Liberals
- after all they are all devout neo-liberal fantasists
AtraHasis Dani123 18 Jul 2015 00:45
Who is this 'nutty left', and why do you think they 'dream of economical
(sic) collapse'?
Are you getting your information from wot some bloke in der pub finks?
As for 'success', ever notice that continual bailout of large corporate
entities leads to inevitable recession and depression? And that the military-industrial
complex requires tension and war to keep it relevant? And that R&D, financed
by the public, but profit being retained in a corporate sense somehow creates
permanent and rising deficit?
Sorry to burst your neoliberal feudalistic little bubble there, but some
of us are thinking beyond slogans like 'dose lefteez iz stoopid'.
"But part of the answer lies in something Americans have a hard time
talking about: class. Trade is a class issue. The trade agreements we have
entered into over the past few decades have consistently harmed some
Americans (manufacturing workers) while just as consistently benefiting
others (owners and professionals). …
To understand "free trade" in such a way has made it difficult for people
in the bubble of the consensus to acknowledge the actual consequences of the
agreements we have negotiated over the years."
"... Despite the neoliberal obsession with wage suppression, history suggests that such a policy is self-destructive. Periods of high wages are associated with rapid technological change. ..."
"... On the ideological front, the South adopted a shallow, but rigid libertarian perspective which resembled modern neoliberalism. Samuel Johnson may have been the first person to see through the hypocrisy of the hollowness of southern libertarianism. ..."
"... the famous Powell Memo helped to spark a well-financed movement of well-finance right-wing political activism which morphed into right-wing political extremism both in economics and politics. ..."
"... In short, neoliberalism was surging ahead and the economy of high wages was now beyond the pale. These new conditions gave new force to the southern "yelps of liberty." The social safety net was taken down and reconstructed as the flag of neoliberalism. The one difference between the rhetoric of the slaveholders and that of the modern neoliberals was that entrepreneurial superiority replaced racial superiority as their battle cry. ..."
Despite the neoliberal obsession with wage suppression, history suggests
that such a policy is self-destructive. Periods of high wages are associated
with rapid technological change.
... ... ...
On the ideological front, the South adopted a shallow, but rigid libertarian
perspective which resembled modern neoliberalism. Samuel Johnson may have been
the first person to see through the hypocrisy of the hollowness of southern
libertarianism. Responding to the colonists' complaint that taxation by
the British was a form of tyranny, Samuel Johnson published his 1775 tract,
"Taxation No Tyranny: An answer to the Resolutions and Address of the American
Congress," asking the obvious question, "how is it that we hear the loudest
yelps for liberty among the drivers of Negroes?" In The Works of Samuel Johnson,
LL. D.: Political Tracts. Political Essays. Miscellaneous Essays (London: J.
Buckland, 1787): pp. 60-146, p. 142.
... ... ...
By the late 19th century, David A Wells, an industrial technician who later
became the chief economic expert in the federal government, by virtue of his
position of overseeing federal taxes. After a trip to Europe, Wells reconsidered
his strong support for protectionism. Rather than comparing the dynamism of
the northern states with the technological backward of their southern counterparts,
he was responding to the fear that American industry could not compete with
the cheap "pauper" labor of Europe. Instead, he insisted that the United States
had little to fear from, the competition from cheap labor, because the relatively
high cost of American labor would ensure rapid technological change, which,
indeed, was more rapid in the United States than anywhere else in the world,
with the possible exception of Germany. Both countries were about to rapidly
surpass England's industrial prowess.
The now-forgotten Wells was so highly regarded that the prize for the best
economics dissertation at Harvard is still known as the David A Wells prize.
His efforts gave rise to a very powerful idea in economic theory at the time,
known as "the economy of high wages," which insisted that high wages drove economic
prosperity. With his emphasis on technical change, driven by the strong competitive
pressures from high wages, Wells anticipated Schumpeter's idea of creative destruction,
except that for him, high wages rather than entrepreneurial genius drove this
process.
Although the economy of high wages remained highly influential through the
1920s, the extensive growth of government powers during World War I reignited
the antipathy for big government. Laissez-faire economics began come back into
vogue with the election of Calvin Coolidge, while the once-powerful progressive
movement was becoming excluded from the ranks of reputable economics.
... ... ...
With Barry Goldwater's humiliating defeat in his presidential campaign,
the famous Powell Memo helped to spark a well-financed movement of well-finance
right-wing political activism which morphed into right-wing political extremism
both in economics and politics. Symbolic of the narrowness of this new
mindset among economists, Milton Friedman's close associate, George Stigler,
said in 1976 that "one evidence of professional integrity of the economist is
the fact that it is not possible to enlist good economists to defend minimum
wage laws." Stigler, G. J. 1982. The Economist as Preacher and Other Essays
(Chicago: University of Chicago Press): p. 60.
In short, neoliberalism was surging ahead and the economy of high wages
was now beyond the pale. These new conditions gave new force to the southern
"yelps of liberty." The social safety net was taken down and reconstructed as
the flag of neoliberalism. The one difference between the rhetoric of the slaveholders
and that of the modern neoliberals was that entrepreneurial superiority replaced
racial superiority as their battle cry.
One final irony: evangelical Christians were at the forefront of the abolitionist
movement. Today, some of them are providing the firepower for the epidemic of
neoliberalism.
"... the US has been successful in dictating neoliberal policies, acting partly through the IMF and World Bank and partly through direct pressure. ..."
"... From roughly the mid 1930s to the mid 1970s a new "interventionist" approach replaced classical liberalism, and it became the accepted belief that capitalism requires significant state regulation in order to be viable. In the 1970s the Old Religion of classical liberalism made a rapid comeback, first in academic economics and then in the realm of public policy. ..."
"... Neoliberal theory claims that a largely unregulated capitalist system (a "free market economy" not only embodies the ideal of free individual choice but also achieves optimum economic performance with respect to efficiency, economic growth, technical progress, and distributional justice. ..."
"... The policy recommendations of neoliberalism are concerned mainly with dismantling what remains of the regulationist welfare state. ..."
"... This paper argues that the resurgence and tenacity of neoliberalism during the past two decades cannot be explained, in an instrumental fashion, by any favorable effects of neoliberal policies on capitalist economic performance. On the contrary, we will present a case that neoliberalism has been harmful for long-run capitalist economic performance, even judging economic performance from the perspective of the interests of capital. It will be argued that the resurgence and continuing dominance of neoliberalism can be explained, at least in part, by changes in the competitive structure of world capitalism, which have resulted in turn from the particular form of global economic integration that has developed in recent decades. The changed competitive structure of capitalism has altered the political posture of big business with regard to economic policy and the role of the state, turning big business from a supporter of state-regulated capitalism into an opponent of it. ..."
"... Second, the neoliberal model creates instability on the macroeconomic level by renouncing state counter-cyclical spending and taxation policies, by reducing the effectiveness of "automatic stabilizers" through shrinking social welfare programs,3 and by loosening public regulation of the financial sector. This renders the system more vulnerable to major financial crises and depressions. Third, the neoliberal model tends to intensify class conflict, which can potentially discourage capitalist investment.4 ..."
"... The evidence from GDP and labor productivity growth rates supports the claim that the neoliberal model is inferior to the state regulationist model for key dimensions of capitalist economic performance. There is ample evidence that the neoliberal model has shifted income and wealth in the direction of the already wealthy. However, the ability to shift income upward has limits in an economy that is not growing rapidly. Neoliberalism does not appear to be delivering the goods in the ways that matter the most for capitalism's long-run stability and survival. ..."
"... Once capitalism had become well established in the US after the Civil War, it entered a period of cutthroat competition and wild accumulation known as the Robber Baron era. In this period a coherent anti-interventionist liberal position emerged and became politically dominant. Despite the enormous inequalities, the severe business cycle, and the outrageous and often unlawful behavior of the Goulds and Rockefellers, the idea that government should not intervene in the economy held sway through the end of the 19th century. ..."
"... Small business has remained adamantly opposed to the big, interventionist state, from the Progressive Era through the New Deal down to the present. This division between big and small business is chronicled for the Progressive Era in Weinstein (1968). In the decades immediately following World War II one can observe this division in the divergent views of the Business Roundtable, a big business organization which often supported interventionist programs, and the US Chambers of Commerce, the premier small business organization, which hewed to an antigovernment stance. ..."
"... By contrast, the typical small business faces a daily battle for survival, which prevents attention to long-run considerations and which places a premium on avoiding the short-run costs of taxation and state regulation. This explains the radically different positions that big business and small business held regarding the proper state role in the economy for the first two-thirds of the twentieth century. ..."
"... This long-standing division between big business and small business appeared to vanish in the US starting in the 1970s. Large corporations and banks which had formerly supported foundations that advocated an active government role in the economy, such as the Brookings Institution, became big donors to neoliberal foundations such as the American Enterprise Institute and the Heritage Foundation. As a result, such right-wing foundations, which previously had to rely mainly on contributions from small business, became very wealthy and influential.10 It was big business=s desertion of the political coalition supporting state intervention and its shift to neoliberalism that rebuilt support for neoliberal theories and policies in the US, starting in the 1970s. With business now unified on economic policy, the shift was dramatic. Big grants became available for economics research having a neoliberal slant. The major media shifted their spin on political developments, and the phrase "government programs" now could not be printed except with the word "bloated" before it. ..."
"... Globalization is usually defined as an increase in the volume of cross-border economic interactions and resource flows, producing a qualitative shift in the relations between national economies and between nation-states (Baker et. al., 1998, p. 5; Kozul-Wright and Rowthorn, 1998, p. 1). Three kinds of economic interactions have increased substantially in past decades: merchandise trade flows, foreign direct investment, and cross-border financial investments. We will briefly examine each, with an eye on their effects on the competitive structure of contemporary capitalism. ..."
"... By the close of the twentieth century, capitalism had become significantly more globalized than it had been fifty years ago, and by some measures it is much more globalized than it had been at the previous peak of this process in 1913. The most important features of globalization today are greatly increased international trade, increased flows of capital across national boundaries (particularly speculative short-term capital), and a major role for large TNCs in manufacturing, extractive activities, and finance, operating worldwide yet retaining in nearly all cases a clear base in a single nation-state. ..."
"... Some analysts argue that globalization has produced a world of such economic interdependence that individual nation-states no longer have the power to regulate capital. However, while global interdependence does create difficulties for state regulation, this effect has been greatly exaggerated. Nation-states still retain a good deal of potential power vis-a-vis capitalist firms, provided that the political will is present to exercise such power. For example, even such a small country as Malaysia proved able to successfully impose capital controls following the Asian financial crisis of 1997, despite the opposition of the IMF and the US government. ..."
"... Globalization appears to be one factor that has transformed big business from a supporter to an opponent of the interventionist state. It has done so partly by producing TNCs whose tie to the domestic markets for goods and labor is limited. ..."
"... Globalization has produced a world capitalism that bears some resemblance to the Robber Baron Era in the US. Giant corporations battle one another in a system lacking well defined rules. Mergers and acquisitions abound, including some that cross national boundaries, but so far few world industries have evolved the kind of tight oligopolistic structure that would lay the basis for a more controlled form of market relations. Like the late 19th century US Robber Barons, today's large corporations and banks above all want freedom from political burdens and restraints as they confront one another in world markets.18 ..."
"... The existence of a powerful bloc of Communist-run states with an alternative "state socialist" socioeconomic system tended to push capitalism toward a state regulationist form. It reinforced the fear among capitalists that their own working classes might turn against capitalism. It also had an impact on relations among the leading capitalist states, promoting inter-state unity behind US leadership, which facilitated the creation and operation of a world-system of state-regulated capitalism.19 The demise of state socialism during 1989-91 removed one more factor that had reinforced the regulationist state. ..."
"... If state socialism re-emerged in one or more major countries, perhaps this might push the capitalist world back toward the regulationist state. However, such a development does not seem likely. Even if Russia or Ukraine at some point does head in that direction, it would be unlikely to produce a serious rival socioeconomic system to that of world capitalism. ..."
Department of Economics and Political Economy Research Institute Thompson Hall
University of Massachusetts Amherst, MA 01003 U.S.A. Telephone 413-545-1248
Fax 413-545-2921 Email [email protected] August, 2000 This paper was published
in Rethinking Marxism, Volume 12, Number 2, Summer 2002, pp. 64-79.
Research assistance was provided by Elizabeth Ramey and Deger Eryar. Research
funding was provided by the Political Economy Research Institute of the University
of Massachusetts at Amherst. Globalization and Neoliberalism 1 For some
two decades neoliberalism has dominated economic policymaking in the US and
the UK. Neoliberalism has strong advocates in continental Western Europe and
Japan, but substantial popular resistance there has limited its influence so
far, despite continuing US efforts to impose neoliberal policies on them. In
much of the Third World, and in the transition countries (except for China),
the US has been successful in dictating neoliberal policies, acting partly through
the IMF and World Bank and partly through direct pressure.
Neoliberalism is an updated version of the classical liberal economic thought
that was dominant in the US and UK prior to the Great Depression of the 1930s.
From roughly the mid 1930s to the mid 1970s a new "interventionist" approach
replaced classical liberalism, and it became the accepted belief that capitalism
requires significant state regulation in order to be viable. In the 1970s the
Old Religion of classical liberalism made a rapid comeback, first in academic
economics and then in the realm of public policy.
Neoliberalism is both a body of economic theory and a policy stance.
Neoliberal theory claims that a largely unregulated capitalist system (a "free
market economy" not only embodies the ideal of free individual choice but also
achieves optimum economic performance with respect to efficiency, economic growth,
technical progress, and distributional justice. The state is assigned a
very limited economic role: defining property rights, enforcing contracts, and
regulating the money supply.1 State intervention to correct market failures
is viewed with suspicion, on the ground that such intervention is likely to
create more problems than it solves.
The policy recommendations of neoliberalism are concerned mainly with
dismantling what remains of the regulationist welfare state. These recommendations
include deregulation of business; privatization of public activities and assets;
elimination of, or cutbacks in, social welfare programs; and reduction of taxes
on businesses and the investing class. In the international sphere, neoliberalism
calls for free movement of goods, services, capital, and money (but not people)
across national boundaries. That is, corporations, banks, and individual investors
should be free to move their property across national boundaries, and free to
acquire property across national boundaries, although free cross-border movement
by individuals is not part of the neoliberal program. How can the re-emergence
of a seemingly outdated and outmoded economic theory be explained? At first
many progressive economists viewed the 1970s lurch toward liberalism as a temporary
response to the economic instability of that decade. As corporate interests
decided that the Keynesian regulationist approach no longer worked to their
advantage, they looked for an alternative and found only the old liberal ideas,
which could at least serve as an ideological basis for cutting those state programs
viewed as obstacles to profit-making. However, neoliberalism has proved to be
more than just a temporary response. It has outlasted the late 1970s/early 1980s
right-wing political victories in the UK (Thatcher) and US (Reagan). Under a
Democratic Party administration in the US and a Labor Party government in the
UK in the 1990s, neoliberalism solidified its position of dominance.
This paper argues that the resurgence and tenacity of neoliberalism during
the past two decades cannot be explained, in an instrumental fashion, by any
favorable effects of neoliberal policies on capitalist economic performance.
On the contrary, we will present a case that neoliberalism has been harmful
for long-run capitalist economic performance, even judging economic performance
from the perspective of the interests of capital. It will be argued that the
resurgence and continuing dominance of neoliberalism can be explained, at least
in part, by changes in the competitive structure of world capitalism, which
have resulted in turn from the particular form of global economic integration
that has developed in recent decades. The changed competitive structure of capitalism
has altered the political posture of big business with regard to economic policy
and the role of the state, turning big business from a supporter of state-regulated
capitalism into an opponent of it.
The Problematic Character of Neoliberalism
Neoliberalism appears to be problematic as a dominant theory for contemporary
capitalism. The stability and survival of the capitalist system depends on its
ability to bring vigorous capital accumulation, where the latter process is
understood to include not just economic expansion but also technological progress.
Vigorous capital accumulation permits rising profits to coexist with rising
living standards for a substantial part of the population over the long-run.2
However, it does not appear that neoliberalism promotes vigorous capital accumulation
in contemporary capitalism. There are a number of reasons why one would not
expect the neoliberal model to promote rapid accumulation. First, it gives rise
to a problem of insufficient aggregate demand over the long run, stemming from
the powerful tendency of the neoliberal regime to lower both real wages and
public spending. Second, the neoliberal model creates instability on the
macroeconomic level by renouncing state counter-cyclical spending and taxation
policies, by reducing the effectiveness of "automatic stabilizers" through shrinking
social welfare programs,3 and by loosening public regulation of the financial
sector. This renders the system more vulnerable to major financial crises and
depressions. Third, the neoliberal model tends to intensify class conflict,
which can potentially discourage capitalist investment.4
The historical evidence confirms doubts about the ability of the neoliberal
model to promote rapid capital accumulation. We will look at growth rates of
gross domestic product (GDP) and of labor productivity. The GDP growth rate
provides at least a rough approximation of the rate of capital accumulation,
while the labor productivity growth rate tells us something about the extent
to which capitalism is developing the forces of production via rising ratios
of means of production to direct labor, technological advance, and improved
labor skills.5 Table 1 shows average annual real GDP growth rates for six leading
developed capitalist countries over two periods, 1950-73 and 1973-99. The first
period was the heyday of state-regulated capitalism, both within those six countries
and in the capitalist world-system as a whole. The second period covers the
era of growing neoliberal dominance. All six countries had significantly faster
GDP growth in the earlier period than in the later one.
While Japan and the major Western European economies have been relatively
depressed in the 1990s, the US is often portrayed as rebounding to great prosperity
over the past decade. Neoliberals often claim that US adherence to neoliberal
policies finally paid off in the 1990s, while the more timid moves away from
state-interventionist policies in Europe and Japan kept them mired in stagnation.
Table 2 shows GDP and labor productivity growth rates for the US economy for
three subperiods during 1948-99.6 Column 1 of Table 2 shows that GDP growth
was significantly slower in 1973-90 B a period of transition from state-regulated
capitalism to the neoliberal model in the US B than in 1948-73. While GDP growth
improved slightly in 1990-99, it remained well below that of the era of state-regulated
capitalism. Some analysts cite the fact that GDP growth accelerated after 1995,
averaging 4.1% per year during 1995-99 (US Bureau of Economic Analysis, 2000).
However, it is not meaningful to compare a short fragment of the 1990s business
cycle expansion to the longrun performance of the economy during 1948-73.7
Column 2 of Table 1 shows that the high rate of labor productivity growth
recorded in 1948- 73 fell by more than half in 1973-90. While there was significant
improvement in productivity growth in the 1990s, it remained well below the
1948-73 rate, despite the rapid spread of what should be productivity-enhancing
communication and information-management technologies during the past decade.
The evidence from GDP and labor productivity growth rates supports the
claim that the neoliberal model is inferior to the state regulationist model
for key dimensions of capitalist economic performance. There is ample evidence
that the neoliberal model has shifted income and wealth in the direction of
the already wealthy. However, the ability to shift income upward has limits
in an economy that is not growing rapidly. Neoliberalism does not appear to
be delivering the goods in the ways that matter the most for capitalism's long-run
stability and survival.
The Structure of Competition and Economic Policy
The processes through which the dominant economic ideology and policies
are selected in a capitalist system are complex and many-sided. No general rule
operates to assure that those economic policies which would be most favorable
for capitalism are automatically adopted. History suggests that one important
determinant of the dominant economic ideology and policy stance is the competitive
structure of capitalism in a given era. Specifically, this paper argues that
periods of relatively unconstrained competition tend to produce the intellectual
and public policy dominance of liberalism, while periods of relatively constrained,
oligopolistic market relations tend to promote interventionist ideas and policies.
A relation in the opposite direction also exists, one which is often commented
upon. That is, one can argue that interventionist policies promote monopoly
power in markets, while liberal policies promote greater competition. This latter
relation is not being denied here. Rather, it will be argued that there is a
normally-overlooked direction of influence, having significant historical explanatory
power, which runs from competitive structure to public policy. In the period
when capitalism first became well established in the US, during 1800-1860, the
government played a relatively interventionist role. The federal government
placed high tariffs on competing manufactured goods from Europe, and federal,
state, and local levels of government all actively financed, and in some cases
built and operated, the new canal and rail system that created a large internal
market. There was no serious debate over the propriety of public financing of
transportation improvements in that era -- the only debate was over which regions
would get the key subsidized routes.
Once capitalism had become well established in the US after the Civil
War, it entered a period of cutthroat competition and wild accumulation known
as the Robber Baron era. In this period a coherent anti-interventionist liberal
position emerged and became politically dominant. Despite the enormous inequalities,
the severe business cycle, and the outrageous and often unlawful behavior of
the Goulds and Rockefellers, the idea that government should not intervene in
the economy held sway through the end of the 19th century.
From roughly 1890 to 1903 a huge merger wave transformed the competitive
structure of US capitalism. Out of that merger wave emerged giant corporations
possessing significant monopoly power in the manufacturing, mining, transportation,
and communication sectors. US industry settled down to a more restrained form
of oligopolistic rivalry. At the same time, many of the new monopoly capitalists
began to criticize the old Laissez Faire ideas and support a more interventionist
role for the state.8 The combination of big business support for state regulation
of business, together with similar demands arising from a popular anti-monopoly
movement based among small farmers and middle class professionals, ushered in
what is called the Progressive Era, from 1900-16. The building of a regulationist
state that was begun in the Progressive Era was completed during the New Deal
era a few decades later, when once again both big business leaders and a vigorous
popular movement (this time based among industrial workers) supported an interventionist
state. Both in the Progressive Era and the New Deal, big business and the popular
movement differed about what types of state intervention were needed. Big business
favored measures to increase the stability of the system and to improve conditions
for profit-making, while the popular movement sought to use the state to restrain
the power and privileges of big business and provide greater security for ordinary
people. The outcome in both cases was a political compromise, one weighted toward
the interests of big business, reflecting the relative power of the latter in
American capitalism.
Small business has remained adamantly opposed to the big, interventionist
state, from the Progressive Era through the New Deal down to the present. This
division between big and small business is chronicled for the Progressive Era
in Weinstein (1968). In the decades immediately following World War II one can
observe this division in the divergent views of the Business Roundtable, a big
business organization which often supported interventionist programs, and the
US Chambers of Commerce, the premier small business organization, which hewed
to an antigovernment stance.
What explains this political difference between large and small business?
When large corporations achieve significant market power and become freed from
fear concerning their immediate survival, they tend to develop a long time horizon
and pay attention to the requirements for assuring growing profits over time.9
They come to see the state as a potential ally. Having high and stable monopoly
profits, they tend to view the cost of government programs as something they
can afford, given their potential benefits. By contrast, the typical small
business faces a daily battle for survival, which prevents attention to long-run
considerations and which places a premium on avoiding the short-run costs of
taxation and state regulation. This explains the radically different positions
that big business and small business held regarding the proper state role in
the economy for the first two-thirds of the twentieth century.
This long-standing division between big business and small business appeared
to vanish in the US starting in the 1970s. Large corporations and banks which
had formerly supported foundations that advocated an active government role
in the economy, such as the Brookings Institution, became big donors to neoliberal
foundations such as the American Enterprise Institute and the Heritage Foundation.
As a result, such right-wing foundations, which previously had to rely mainly
on contributions from small business, became very wealthy and influential.10
It was big business=s desertion of the political coalition supporting state
intervention and its shift to neoliberalism that rebuilt support for neoliberal
theories and policies in the US, starting in the 1970s. With business now unified
on economic policy, the shift was dramatic. Big grants became available for
economics research having a neoliberal slant. The major media shifted their
spin on political developments, and the phrase "government programs" now could
not be printed except with the word "bloated" before it.
This switch in the dominant economic model first showed up in the mid 1970s
in academic economics, as the previously marginalized Chicago School spread
its influence far beyond the University of Chicago. This was soon followed by
a radical shift in the public policy arena. In 1978- 79 the previously interventionist
Carter Administration began sounding the very neoliberal themes B deregulation
of business, cutbacks in social programs, and general fiscal and monetary austerity
B that were to become the centerpiece of Reagan Administration policies in 1981.
What caused the radical change in the political posture of big business regarding
state intervention in the economy? This paper argues that a major part of the
explanation lies in the effects of the globalization of the world capitalist
economy in the post-World War II period.
Globalization and Competition
Globalization is usually defined as an increase in the volume of cross-border
economic interactions and resource flows, producing a qualitative shift in the
relations between national economies and between nation-states (Baker et. al.,
1998, p. 5; Kozul-Wright and Rowthorn, 1998, p. 1). Three kinds of economic
interactions have increased substantially in past decades: merchandise trade
flows, foreign direct investment, and cross-border financial investments. We
will briefly examine each, with an eye on their effects on the competitive structure
of contemporary capitalism.
Table 3 shows the ratio of merchandise exports to gross domestic product
for selected years from 1820 to 1992, for the world and also for Western Europe,
the US, and Japan. Capitalism brought a five-fold rise in world exports relative
to output from 1820-70, followed by another increase of nearly three-fourths
by 1913. After declining in the interwar period, world exports reached a new
peak of 11.2% of world output in 1973, rising further to 13.5% in 1992. The
1992 figure was over fifty per cent higher than the pre-World War I peak.
Merchandise exports include physical goods only, while GDP includes services,
many of which are not tradable, as well as goods. In the twentieth century the
proportion of services in GDP has risen significantly. Table 4 shows an estimate
of the ratio of world merchandise exports to the good-only portion of world
GDP. This ratio nearly tripled during 1950-92, with merchandise exports rising
to nearly one-third of total goods output in the latter year. The 1992 figure
was 2.6 times as high as that of 1913.
Western Europe, the US, and Japan all experienced significant increases in
exports relative to GDP during 1950-92, as Table 3 shows. All of them achieved
ratios of exports to GDP far in excess of the 1913 level. While exports were
only 8.2% of the total GDP of the US in 1992, exports amounted to 22.0% of the
non-service portion of GDP that year (Economic Report of the President,
1999, pp. 338, 444).
Many analysts view foreign direct investment as the most important form of
cross-border economic interchange. It is associated with the movement of technology
and organizational methods, not just goods. Table 5 shows two measures of foreign
direct investment. Column 1 gives the outstanding stock of foreign direct investment
in the world as a percentage of world output. This measure has more than doubled
since 1975, although it is not much greater today than it was in 1913. Column
2 shows the annual inflow of direct foreign investment as a percentage of gross
fixed capital formation. This measure increased rapidly during 1975-95. However,
it is still relatively low in absolute terms, with foreign direct investment
accounting for only 5.2 per cent of gross fixed capital formation in 1995.
Not all, or even most, international capital flows take the form of direct
investment. Financial flows (such as cross-border purchases of securities and
deposits in foreign bank accounts) are normally larger. One measure that takes
account of financial as well as direct investment is the total net movement
of capital into or out of a country. That measure indicates the extent to which
capital from one country finances development in other countries. Table 6 shows
the absolute value of current account surpluses or deficits as a percentage
of GDP for 12 major capitalist countries. Since net capital inflow or outflow
is approximately equal to the current account deficit or surplus (differing
only due to errors and omissions), this indicates the size of net cross-border
capital flows. The ratio nearly doubled from 1970-74 to 1990-96, although it
remained well below the figure for 1910-14.
Cross-border gross capital movements have grown much more rapidly
than cross-border net capital movements.11 In recent times a very large
and rapidly growing volume of capital has moved back and forth across national
boundaries. Much of this capital flow is speculative in nature, reflecting growing
amounts of short-term capital that are moved around the world in search of the
best temporary return. No data on such flows are available for the early part
of this century, but the data for recent decades are impressive. During 1980-95
cross-border transactions in bonds and equities as a percentage of GDP rose
from 9% to 136% for the US, from 8% to 168% for Germany, and from 8% to 66%
for Japan (Baker et. al., 1998, p. 10). The total volume of foreign exchange
transactions in the world rose from about $15 billion per day in 1973 to $80
billion per day in 1980 and $1260 billion per day in 1995. Trade in goods and
services accounted for 15% of foreign exchange transactions in 1973 but for
less than 2% of foreign exchange transactions in 1995 (Bhaduri, 1998, p. 152).
While cross-border flows of goods and capital are usually considered to be
the best indicators of possible globalization of capitalism, changes that have
occurred over time within capitalist enterprises are also relevant. That is,
the much-discussed rise of the transnational corporation (TNC) is relevant here,
where a TNC is a corporation which has a substantial proportion of its sales,
assets, and employees outside its home country.12 TNCs existed in the pre-World
War I era, primarily in the extractive sector. In the post-World War II period
many large manufacturing corporations in the US, Western Europe, and Japan became
TNCs.
The largest TNCs are very international measured by the location of their
activities. One study found that the 100 largest TNCs in the world (ranked by
assets) had 40.4% of their assets abroad, 50.0% of output abroad, and 47.9%
of employment abroad in 1996 (Sutcliffe and Glyn, 1999, p. 125). While this
shows that the largest TNCs are significantly international in their activities,
all but a handful have retained a single national base for top officials and
major stockholders.13 The top 200 TNCs ranked by output were estimated to produce
only about 10 per cent of world GDP in 1995 (Sutcliffe and Glyn, 1999, p. 122).
By the close of the twentieth century, capitalism had become significantly
more globalized than it had been fifty years ago, and by some measures it is
much more globalized than it had been at the previous peak of this process in
1913. The most important features of globalization today are greatly increased
international trade, increased flows of capital across national boundaries (particularly
speculative short-term capital), and a major role for large TNCs in manufacturing,
extractive activities, and finance, operating worldwide yet retaining in nearly
all cases a clear base in a single nation-state.
While the earlier wave of globalization before World War I did produce a
capitalism that was significantly international, two features of that earlier
international system differed from the current global capitalism in ways that
are relevant here. First, the pre-world War I globalization took place within
a world carved up into a few great colonial empires, which meant that much of
the so-called "cross-border" trade and investment of that earlier era actually
occurred within a space controlled by a single state. Second, the high level
of world trade reached before World War I occurred within a system based much
more on specialization and division of labor. That is, manufactured goods were
exported by the advanced capitalist countries in exchange for primary products,
unlike today when most trade is in manufactured goods. In 1913 62.5% of world
trade was in primary products (Bairoch and Kozul-Wright, 1998, p. 45). By contrast,
in 1970 60.9% of world exports were manufactured goods, rising to 74.7% in 1994
(Baker et. al., 1998, p. 7).
Some analysts argue that globalization has produced a world of such economic
interdependence that individual nation-states no longer have the power to regulate
capital. However, while global interdependence does create difficulties for
state regulation, this effect has been greatly exaggerated. Nation-states still
retain a good deal of potential power vis-a-vis capitalist firms, provided that
the political will is present to exercise such power. For example, even such
a small country as Malaysia proved able to successfully impose capital controls
following the Asian financial crisis of 1997, despite the opposition of the
IMF and the US government. A state that has the political will to exercise
some control over movements of goods and capital across its borders still retains
significant power to regulate business. The more important effect of globalization
has been on the political will to undertake state regulation, rather than on
the technical feasibility of doing so. Globalization has had this effect by
changing the competitive structure of capitalism. It appears that globalization
in this period has made capitalism significantly more competitive, in several
ways. First, the rapid growth of trade has changed the situation faced by large
corporations. Large corporations that had previously operated in relatively
controlled oligopolistic domestic markets now face competition from other large
corporations based abroad, both in domestic and foreign markets. In the US the
rate of import penetration of domestic manufacturing markets was only 2 per
cent in 1950; it rose to 8% in 1971 and 16% by 1993, an 8-fold increase since
1950 (Sutcliffe and Glyn, 1999, p. 116).
Second, the rapid increase in foreign direct investment has in many cases
placed TNCs production facilities in the home markets of their foreign rivals.
General Motors not only faces import competition from Toyota and Honda but has
to compete with US-produced Toyota and Honda vehicles. Third, the increasingly
integrated and open world financial system has thrown the major banks and other
financial institutions of the leading capitalist nations increasingly into competition
with one another.
Globalization appears to be one factor that has transformed big business
from a supporter to an opponent of the interventionist state. It has done so
partly by producing TNCs whose tie to the domestic markets for goods and labor
is limited. More importantly, globalization tends to turn big business
into small business. The process of globalization has increased the competitive
pressure faced by large corporations and banks, as competition has become a
world-wide relationship.17 Even if those who run large corporations and financial
institutions recognize the need for a strong nationstate in their home base,
the new competitive pressure they face shortens their time horizon. It pushes
them toward support for any means to reduce their tax burden and lift their
regulatory constraints, to free them to compete more effectively with their
global rivals. While a regulationist state may seem to be in the interests of
big business, in that it can more effectively promote capital accumulation in
the long run, in a highly competitive environment big business is drawn away
from supporting a regulationist state.
Globalization has produced a world capitalism that bears some resemblance
to the Robber Baron Era in the US. Giant corporations battle one another in
a system lacking well defined rules. Mergers and acquisitions abound, including
some that cross national boundaries, but so far few world industries have evolved
the kind of tight oligopolistic structure that would lay the basis for a more
controlled form of market relations. Like the late 19th century US Robber Barons,
today's large corporations and banks above all want freedom from political burdens
and restraints as they confront one another in world markets.18
The above interpretation of the rise and persistence of neoliberalism attributes
it, at least in part, to the changed competitive structure of world capitalism
resulting from the process of globalization. As neoliberalism gained influence
starting in the 1970s, it became a force propelling the globalization process
further. One reason for stressing the line of causation running from globalization
to neoliberalism is the time sequence of the developments. The process of globalization,
which had been reversed to some extent by political and economic events in the
interwar period, resumed right after World War II, producing a significantly
more globalized world economy and eroding the monopoly power of large corporations
well before neoliberalism began its second coming in the mid 1970s. The rapid
rise in merchandise exports began during the Bretton Woods period, as Table
3 showed. So too did the growing role for TNC's. These two aspects of the current
globalization had their roots in the postwar era of state-regulated capitalism.
This suggests that, to some extent, globalization reflects a long-run tendency
in the capital accumulation process rather than just being a result of the rising
influence of neoliberal policies. On the other hand, once neoliberalism became
dominant, it accelerated the process of globalization. This can be seen most
clearly in the data on cross-border flows of both real and financial capital,
which began to grow rapidly only after the 1960s.
Other Factors Promoting Neoliberalism
The changed competitive structure of capitalism provides part of the explanation
for the rise from the ashes of classical liberalism and its persistence in the
face of widespread evidence of its failure to deliver the goods. However, three
additional factors have played a role in promoting neoliberal dominance. These
are the weakening of socialist movements in the industrialized capitalist countries,
the demise of state socialism, and the long period that has elapsed since the
last major capitalist economic crisis. There is space here for only some brief
comments about these additional factors.
The socialist movements in the industrialized capitalist countries have declined
in strength significantly over the past few decades. While Social Democratic
parties have come to office in several European countries recently, they no
longer represent a threat of even significant modification of capitalism, much
less the specter of replacing capitalism with an alternative socialist system.
The regulationist state was always partly a response to the fear of socialism,
a point illustrated by the emergence of the first major regulationist state
of the era of mature capitalism in Germany in the late 19th century, in response
to the world=s first major socialist movement. As the threat coming from socialist
movements in the industrialized capitalist countries has receded, so too has
to incentive to retain the regulationist state.
The existence of a powerful bloc of Communist-run states with an alternative
"state socialist" socioeconomic system tended to push capitalism toward a state
regulationist form. It reinforced the fear among capitalists that their own
working classes might turn against capitalism. It also had an impact on relations
among the leading capitalist states, promoting inter-state unity behind US leadership,
which facilitated the creation and operation of a world-system of state-regulated
capitalism.19 The demise of state socialism during 1989-91 removed one more
factor that had reinforced the regulationist state.
The occurrence of a major economic crisis tends to promote an interventionist
state, since active state intervention is required to overcome a major crisis.
The memory of a recent major crisis tends to keep up support for a regulationist
state, which is correctly seen as a stabilizing force tending to head off major
crises. As the Great Depression of the 1930s has receded into the distant past,
the belief has taken hold that major economic crises have been banished forever.
This reduces the perceived need to retain the regulationist state.
Concluding Comments
If neoliberalism continues to reign as the dominant ideology and policy stance,
it can be argued that world capitalism faces a future of stagnation, instability,
and even eventual social breakdown.20 However, from the factors that have promoted
neoliberalism one can see possible sources of a move back toward state-regulated
capitalism at some point. One possibility would be the development of tight
oligopoly and regulated competition on a world scale. Perhaps the current merger
wave might continue until, as happened at the beginning of the 20th century
within the US and in other industrialized capitalist economies, oligopoly replaced
cutthroat competition, but this time on a world scale. Such a development might
revive big business support for an interventionist state. However, this does
not seem to be likely in the foreseeable future. The world is a big place, with
differing cultures, laws, and business practices in different countries, which
serve as obstacles to overcoming the competitive tendency in market relations.
Transforming an industry=s structure so that two to four companies produce the
bulk of the output is not sufficient in itself to achieve stable monopoly power,
if the rivals are unable to communicate effectively with one another and find
common ground for cooperation. Also, it would be difficult for international
monopolies to exercise effective regulation via national governments, and a
genuine world capitalist state is not a possibility for the foreseeable future.
If state socialism re-emerged in one or more major countries, perhaps
this might push the capitalist world back toward the regulationist state. However,
such a development does not seem likely. Even if Russia or Ukraine at some point
does head in that direction, it would be unlikely to produce a serious rival
socioeconomic system to that of world capitalism.
A more likely source of a new era of state interventionism might come from
one of the remaining two factors considered above. The macro-instability of
neoliberal global capitalism might produce a major economic crisis at some point,
one which spins out of the control of the weakened regulatory authorities. This
would almost certainly revive the politics of the regulationist state. Finally,
the increasing exploitation and other social problems generated by neoliberal
global capitalism might prod the socialist movement back to life at some point.
Should socialist movements revive and begin to seriously challenge capitalism
in one or more major capitalist countries, state regulationism might return
in response to it. Such a development would also revive the possibility of finally
superceding capitalism and replacing it with a system based on human need rather
than private profit.
"... Elites can continue on the current path of pursuing integration projects and defending existing
integration, hoping to win enough popular support that their efforts are not thwarted. On the evidence
of the U.S. presidential campaign and the Brexit debate, this strategy may have run its course. ...
..."
"... I think some fellows already had this idea: "Much more promising is this idea: The promotion
of global integration can become a bottom-up rather than a top-down project" -- "Workers of the World,
Unite. You have nothing to lose but your chains!" ~Marx/Engels, 1848 ..."
"... Krugman sort of said this when he saw that apparel multinationals were shifting jobs out of
China to Bangladesh. Like $3 an hour is just way too high for workers. ..."
"... The "populists" are raging against global trade which benefits the world poor. The Very Serious
economists know what is really going on and have to interests of the poor at heart. Plus they are smarter
than the "populists" who are just dumb hippies. ..."
"... And what about neocolonialism and debt slavery ? http://historum.com/blogs/solidaire/245-debt-slavery-neo-colonialism-neoliberalism.html
..."
"... International debtors are the modern colonialists, sucking the marrow of countries; no armies
are needed anymore to keep those countries subjugated. Debt is the modern instrument of enslavement,
the international banks, corporations and hedge funds the modern colonial powers, and its enforcers
are instruments like the Global Bank, the IMF, and the corrupt, collaborationist governments (and totalitarian
regimes) of those countries, supported and propped up by these neo-colonials. ..."
"... Cover your a$$ much Larry? No mention of mass immigration? No mention of the elites' conscious,
planned attack on homogeneous societies in Western Europe, the US, and now Japan? ..."
"... The US was 88% European as of 1960. As of 1800 it was like 90% English. So yes, it was basically
a homogeneous society prior to the immigration act of 1965. Today it is extremely hard for Europeans
to get into the US -- but easier for non-Europeans. Now why would that be? Hmm .... ..."
"... The only trade that is actually free is trade not covered by laws and/or treaties. All other
trade is regulated trade. ..."
"... Here's a good rule to follow. When someone calls something the exact opposite of what it is,
in all probability they are trying to hustle your wallet. ..."
"... ISIS was invented by Wall Street who financed them. ISIS is a scam, just like Bin Laden's group,
just like "COMMUNISM!!!!" to control people. To manipulate them. ..."
"... Guys, the bourgeois state is a protection racket and always has been. It makes you feel safe,
secure and "feel like man". So we can enjoy every indulgent individual lust the world has to offer.
Then comes in dialectics of what that protection racket should do. ..."
"... To me, the bourgeois state is nothing more than a protection racket for the rich, something
you should not forget. ..."
"... I find it rather precious that Summers pretends not to understand why people hate TPP. I do
not think there is any real widespread antipathy toward global integration, though it does pose some
rather substantial systemic dangers, as we saw in the global financial collapse. What people, including
me, oppose is how that integration is structured. These agreements are about is not "free trade", but
removing all restrictions on global capital and that is a big problem. ..."
"... TPP is not free trade. It is protectionism for the rich. ..."
"... All or most modern "free trade" agreements are like that. What people oppose is agreements
which impoverish them and enrich capital. ..."
"... More free trade arrangement are not always better trade arrangements. People have seen the
results of the labor race to the bottom caused by earlier free trade agreements; and now they are guessing
we're going to get the same kind of race to the bottom with TPP when we have to put all of our environmental
laws and other domestic regulations into capitalist competition with backward countries. ..."
"... progressive states (WA, OR, CA, NV, IL, NY, MD) could simply treat union busting the same way
any OTHER major muscling or manipulation of the free market is treated: make it a felony. ..."
"... Summers: "Pie in the Sky" So trade negotiations would have to be lead by labor advocates and
environmental groups -- sounds great to me, but I can't for the life of me figure out why the goods
and service producers (i.e. capital owners) would have any incentive to promote trade under such a negotiated
trade agreement... or that trade would actually occur. You'd have to eliminate private enterprise incentives
to profit I think.. not something the U.S.'s "individualism" god can't tolerate. ..."
"... Alas, the Kaiser, the Tsar, and the Emperor did not act in accord with its tenets. Either increased
global trade is irrelevant to war and peace, or World War I didn't happen. Your pick which to believe.
..."
What's behind the revolt against global integration? : Since the end of World War II, a broad
consensus in support of global economic integration as a force for peace and prosperity has been
a pillar of the international order. ...
This broad program of global integration has been more successful than could reasonably have
been hoped. ... Yet a revolt against global integration is underway in the West. ...
One substantial part of what is behind the resistance is a lack of knowledge. ...The core of
the revolt against global integration, though, is not ignorance. It is a sense - unfortunately
not wholly unwarranted - that it is a project being carried out by elites for elites, with little
consideration for the interests of ordinary people. ...
Elites can continue on the current path of pursuing integration projects and defending
existing integration, hoping to win enough popular support that their efforts are not thwarted.
On the evidence of the U.S. presidential campaign and the Brexit debate, this strategy may have
run its course. ...
Much more promising is this idea: The promotion of global integration can become a bottom-up
rather than a top-down project. The emphasis can shift from promoting integration to managing
its consequences. This would mean a shift from international trade agreements to international
harmonization agreements, whereby issues such as labor rights and environmental protection would
be central, while issues related to empowering foreign producers would be secondary. It would
also mean devoting as much political capital to the trillions of dollars that escape taxation
or evade regulation through cross-border capital flows as we now devote to trade agreements. And
it would mean an emphasis on the challenges of middle-class parents everywhere who doubt, but
still hope desperately, that their kids can have better lives than they did.
I think some fellows already had this idea: "Much more promising is this idea: The promotion
of global integration can become a bottom-up rather than a top-down project" -- "Workers of the
World, Unite. You have nothing to lose but your chains!" ~Marx/Engels, 1848
Krugman sort of said this when he saw that apparel multinationals were shifting jobs out of
China to Bangladesh. Like $3 an hour is just way too high for workers.
A large part of the concern over free trade comes from the weak economic performances around the
globe. Summers could have addressed this. Jared Bernstein and Dean Baker - both sensible economists
- for example recently called on the US to do its own currency manipulation so as to reverse the
US$ appreciation which is lowering our net exports quite a bit.
What they left out is the fact that both China and Japan have seen currency appreciations as
well. If we raise our net exports at their expense, that lowers their economic activity. Better
would be global fiscal stimulus. I wish Larry had raised this issue here.
The "populists" are raging against global trade which benefits the world poor. The Very Serious
economists know what is really going on and have to interests of the poor at heart. Plus they
are smarter than the "populists" who are just dumb hippies.
One of the most fundamental reasons for the poverty and underdevelopment of Africa (and of
almost all "third world" countries) is neo-colonialism, which in modern history takes the shape
of external debt.
When countries are forced to pay 40,50,60% of their government budgets just to pay the interests
of their enormous debts, there is little room for actual prosperity left.
International debtors are the modern colonialists, sucking the marrow of countries; no
armies are needed anymore to keep those countries subjugated. Debt is the modern instrument of
enslavement, the international banks, corporations and hedge funds the modern colonial powers,
and its enforcers are instruments like the Global Bank, the IMF, and the corrupt, collaborationist
governments (and totalitarian regimes) of those countries, supported and propped up by these neo-colonials.
In reality, not much has changed since the fall of the great colonial empires. In paper, countries
have gained their sovereignty, but in reality they are enslaved to the international credit system.
The only thing that has changed, is that now the very colonial powers of the past, are threatened
to become debt colonies themselves. You see, global capitalism and credit system has no country,
nationality, colour; it only recognises the colour of money, earned at all cost by the very few,
on the expense of the vast, unsuspected and lulled masses.
Debt had always been a very efficient way of control, either on a personal, or state level.
And while most of us are aware of the implementations of personal debt and the risks involved,
the corridors of government debt are poorly lit, albeit this kind of debt is affecting all citizens
of a country and in ways more profound and far reaching into the future than those of private
debt.
Global capitalism was flourishing after WW2, and reached an apex somewhere in the 70's.
The lower classes in the mature capitalist countries had gained a respectable portion of the
distributed wealth, rights and privileges inconceivable several decades before. The purchasing
power of the average American for example, was very satisfactory, fully justifying the American
dream. Similar phenomena were taking place all over the "developed" world.
Cover your a$$ much Larry? No mention of mass immigration? No mention of the elites' conscious,
planned attack on homogeneous societies in Western Europe, the US, and now Japan?
There is of course no reasonable answering to prejudice, since prejudice is always unreasonable,
but should there be a question, when was the last time that, say, the United States or the territory
that the US now covers was a homogeneous society?
Before the US engulfed Spanish peoples? Before the US engulfed African peoples? Before the
US engulfed Indian peoples? When did the Irish, just to think of a random nationality, ruin "our"
homogeneity?
I could continue, but how much of a point is there in being reasonable?
The US was 88% European as of 1960. As of 1800 it was like 90% English. So yes, it was basically
a homogeneous society prior to the immigration act of 1965. Today it is extremely hard for Europeans
to get into the US -- but easier for non-Europeans. Now why would that be? Hmm ....
ISIS was invented by Wall Street who financed them. ISIS is a scam, just like Bin Laden's
group, just like "COMMUNISM!!!!" to control people. To manipulate them.
It is like using the internet to think you are "edgy". Some dudes like psuedo-science scam
artist Mike Adams are uncovering secrets to this witty viewer............then you wonder why society
is degenerating. What should happen with Mike Adams is, he should be beaten up and castrated.
My guess he would talk then. Boy would his idiot followers get a surprise and that surprise would
have results other than "poor mikey, he was robbed".
This explains why guys like Trump get delegates. Not because he uses illegal immigrants in
his old businesses, not because of some flat real wages going over 40 years, not because he is
a conman marketer.........he makes them feel safe. That is purely it. I think its pathetic, but
that is what happens in a emasculated world. Safety becomes absolute concern. "Trump makes me
feel safe".
Guys, the bourgeois state is a protection racket and always has been. It makes you feel
safe, secure and "feel like man". So we can enjoy every indulgent individual lust the world has
to offer. Then comes in dialectics of what that protection racket should do.
To me, the bourgeois state is nothing more than a protection racket for the rich, something
you should not forget.
I find it rather precious that Summers pretends not to understand why people hate TPP. I do
not think there is any real widespread antipathy toward global integration, though it does pose
some rather substantial systemic dangers, as we saw in the global financial collapse. What people,
including me, oppose is how that integration is structured. These agreements are about is not
"free trade", but removing all restrictions on global capital and that is a big problem.
Actually, this is my first actual response to the post itself, but you were too busy being and
a*****e to notice. All or most modern "free trade" agreements are like that. What people oppose
is agreements which impoverish them and enrich capital.
This has become a popular line, and it's not exactly false. But so what if it were a "free trade"
agreement? More free trade arrangement are not always better trade arrangements. People have
seen the results of the labor race to the bottom caused by earlier free trade agreements; and
now they are guessing we're going to get the same kind of race to the bottom with TPP when we
have to put all of our environmental laws and other domestic regulations into capitalist competition
with backward countries.
" The promotion of global integration can become a bottom-up rather than a top-down project. "
" ... whereby issues such as labor rights and environmental protection would be central ...
"
+1
Now if we could just adopt that policy internally in the United States first we could then
(and only then) support it externally across the world.
Easy approach: (FOR THE TEN MILLIONTH TIME!) progressive states (WA, OR, CA, NV, IL, NY,
MD) could simply treat union busting the same way any OTHER major muscling or manipulation of
the free market is treated: make it a felony. FYI (for those who are not aware) states can
add to federal labor protections, just not subtract.
A completely renewed, re-constituted democracy would be born.
Biggest obstacle to this being done in my (crackpot?) view: human males. Being instinctive
pack hunters, before they check out any idea they, first, check in with the pack (all those other
boys who are also checking in with the pack) -- almost automatically infer impossibility to overcome
what they see (correctly?) as wheels within wheels of inertia.
Self-fulfilling prophecy: nothing (not the most obvious, SHOULD BE easiest possible to get
support for actions) ever gets done.
I'm not the only one seeking a new path forward on trade.
by Jared Bernstein
April 11th, 2016 at 9:20 am
"...
Here's Larry's view of the way forward:
"The promotion of global integration can become a bottom-up rather than a top-down project.
The emphasis can shift from promoting integration to managing its consequences. This would
mean a shift from international trade agreements to international harmonization agreements,
whereby issues such as labor rights and environmental protection would be central, while issues
related to empowering foreign producers would be secondary. It would also mean devoting as
much political capital to the trillions of dollars that escape taxation or evade regulation
through cross-border capital flows as we now devote to trade agreements. And it would mean
an emphasis on the challenges of middle-class parents everywhere who doubt, but still hope
desperately, that their kids can have better lives than they did.
Good points, all. "Bottom-up" means what I've been calling a more representative, inclusive
process. But what's this about "international harmonization?""
It's a way of saying that we need to reduce the "frictions" and thus costs between trading
partners at the level of pragmatic infrastructure, not corporate power. One way to think of
this is TFAs, not FTAs. TFAs are trade facilitation agreements, which are more about integrating
ports, rail, and paperwork than patents that protect big Pharma.
It's refreshing to see mainstreamers thinking creatively about the anger that's surfaced
around globalization. Waiting for the anger to dissipate and then reverting back to the old
trade regimes may be the preferred path for elites, but that path may well be blocked. We'd
best clear a new, wider path, one that better accommodates folks from all walks of life, both
here and abroad."
Summers: "Pie in the Sky" So trade negotiations would have to be lead by labor advocates and
environmental groups -- sounds great to me, but I can't for the life of me figure out why the
goods and service producers (i.e. capital owners) would have any incentive to promote trade under
such a negotiated trade agreement... or that trade would actually occur. You'd have to eliminate
private enterprise incentives to profit I think.. not something the U.S.'s "individualism" god
can't tolerate.
Imagine a trade deal negotiated by the AFL-CIO. Labor wins a lot and capital owners lose a little.
We can all then smile and say to the latter - go get your buddies in Congress more serious about
the compensation principle. Turn the table!
"consensus in support of global economic integration as a force for peace and prosperity " --
"The Great Illusion" (
https://en.m.wikipedia.org/wiki/The_Great_Illusion
)
That increased trade is a bulwark against war rears its ugly head again. The above book which
so ironically delivered the message was published in 1910.
Alas, the Kaiser, the Tsar, and the Emperor did not act in accord with its tenets. Either
increased global trade is irrelevant to war and peace, or World War I didn't happen. Your pick
which to believe.
Our problems began back in the 1970s when we abandoned the Bretton Woods international capital
controls and then broke the unions, cut taxes on corporations and upper income groups, and deregulated
the financial system. This eventually led a stagnation of wages in the US and an increase in the
concentration of income at the top of the income distribution throughout the world:
http://www.rwEconomics.com/Ch_1.htm
When combined with tax cuts and financial deregulation it led to increasing debt relative to
income in the importing countries that caused the financial catastrophe we went through in 2008,
the economic stagnation that followed, and the social unrest we see throughout the world today.
This, in turn, created a situation in which the full utilization of our economic resources can
only be maintained through an unsustainable increase in debt relative to income:
http://www.rwEconomics.com/htm/WDCh3e.htm
This is what has to be overcome if we are to get out of the mess the world is in today, and
it's not going to be overcome by pretending that it's just going to go away if people can just
become educated about the benefits of trade. At least that's not the way it worked out in the
1930s: http://www.rwEconomics.com/LTLGAD.htm
"... From Tunis to Tel Aviv, Madrid to Oakland, a new generation of youth activists is challenging the neoliberal state that has dominated the world ever since the Cold War ended. ..."
"... young rebels are reacting to a single stunning worldwide development: the extreme concentration of wealth in a few hands thanks to neoliberal policies of deregulation and union busting. They have taken to the streets, parks, plazas and squares to protest against the resulting corruption, the way politicians can be bought and sold, and the impunity ..."
"... In the "glorious thirty years" after World War II, North America and Western Europe achieved remarkable rates of economic growth and relatively low levels of inequality for capitalist societies, while instituting a broad range of benefits for workers, students and retirees. From roughly 1980 on, however, the neoliberal movement, rooted in the laissez-faire economic theories of Milton Friedman, launched what became a full-scale assault on workers' power and an attempt, often remarkably successful, to eviscerate the social welfare state. ..."
"... "Washington consensus" meant that the urge to impose privatisation on stagnating, nepotistic postcolonial states would become the order of the day. ..."
"... While neoliberalism has produced more unequal societies throughout the world, nowhere else has the income of the poor declined quite so strikingly. The concentration of wealth in a few hands profoundly contradicts the founding principles of Israel's Labour Zionism, and results from decades of right-wing Likud policies punishing the poor and middle classes and shifting wealth to the top of society. ..."
"... Juan Cole is the Richard P. Mitchell Professor of History and the director of the Centre for South Asian Studies at the University of Michigan. His latest book, ..."
"... Engaging the Muslim World , is just out in a revised paperback edition from Palgrave Macmillan. He runs the Informed Comment website. ..."
"... A version of this article was first published on Tom Dispatch . ..."
"... The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy. ..."
ANN ARBOR, MICHIGAN - From Tunis to Tel Aviv, Madrid to Oakland, a new
generation of youth activists is challenging the neoliberal state that has dominated
the world ever since the Cold War ended. The massive popular protests that
shook the globe this year have much in common, though most of the reporting
on them in the mainstream media has obscured the similarities.
Whether in Egypt or the United States, young rebels are reacting to a
single stunning worldwide development: the extreme concentration of wealth in
a few hands thanks to neoliberal policies of deregulation and union busting.
They have taken to the streets, parks, plazas and squares to protest against
the resulting corruption, the way politicians can be bought and sold, and the
impunity
ANN ARBOR, MICHIGAN - From Tunis to Tel Aviv, Madrid to
Oakland, a new generation of youth activists is challenging the neoliberal state
that has dominated the world ever since the Cold War ended. The massive popular
protests that shook the globe this year have much in common, though most of
the reporting on them in the mainstream media has obscured the similarities.
Whether in Egypt or the United States, young rebels are reacting to a single
stunning worldwide development: the extreme concentration of wealth in a few
hands thanks to neoliberal policies of deregulation and union busting. They
have taken to the streets, parks, plazas and squares to protest against the
resulting corruption, the way politicians can be bought and sold, and the impunity
of the white-collar criminals who have run riot in societies everywhere. They
are objecting to high rates of unemployment, reduced social services, blighted
futures and above all the substitution of the market for all other values as
the matrix of human ethics and life.
Pasha the Tiger
In the "glorious thirty years" after World War II, North America and
Western Europe achieved remarkable rates of economic growth and relatively low
levels of inequality for capitalist societies, while instituting a broad range
of benefits for workers, students and retirees. From roughly 1980 on, however,
the neoliberal movement, rooted in the laissez-faire economic theories of Milton
Friedman, launched what became a full-scale assault on workers' power and an
attempt, often remarkably successful, to eviscerate the social welfare state.
Neoliberals chanted the mantra that everyone would benefit if the public
sector were privatised, businesses deregulated and market mechanisms allowed
to distribute wealth. But as economist David Harvey
argues, from the beginning it was a doctrine that primarily benefited the
wealthy, its adoption allowing the top one per cent in any neoliberal society
to capture a disproportionate share of whatever wealth was generated.
In the global South, countries that gained their independence from European
colonialism after World War II tended to create large public sectors as part
of the process of industrialization. Often, living standards improved as a result,
but by the 1970s, such developing economies were generally experiencing a levelling-off
of growth. This happened just as neoliberalism became ascendant in Washington,
Paris and London as well as in Bretton Woods institutions like the International
Monetary Fund. This "Washington consensus" meant that the urge to impose
privatisation on stagnating, nepotistic postcolonial states would become the
order of the day.
Egypt and Tunisia, to take two countries in the spotlight for sparking the
Arab Spring, were successfully pressured in the 1990s to privatise their relatively
large public sectors. Moving public resources into the private sector created
an almost endless range of opportunities for staggering levels of corruption
on the part of the ruling families of autocrats
Zine El Abidine Ben Ali in Tunis and
Hosni Mubarak in Cairo. International banks, central banks and emerging
local private banks aided and abetted their agenda.
It was not surprising then that one of the first targets of Tunisian crowds
in the course of the revolution they made last January was the
Zitouna bank, a branch of which they torched. Its owner? Sakher El Materi,
a son-in-law of President Ben Ali and the notorious owner of
Pasha, the well-fed pet tiger that prowled the grounds of one of his sumptuous
mansions. Not even the way his outfit sought legitimacy by practicing "Islamic
banking" could forestall popular rage. A 2006 State Department cable released
by WikiLeaks
observed, "One local financial expert blames the [Ben Ali] Family for chronic
banking sector woes due to the great percentage of non-performing loans issued
through crony connections, and has essentially paralysed banking authorities
from genuine recovery efforts." That is, the banks were used by the regime to
give away money to his cronies, with no expectation of repayment.
Tunisian activists similarly directed their ire at foreign banks and lenders
to which their country owes $14.4bn. Tunisians are still railing and rallying
against the repayment of all that money, some of which they believe was
borrowed profligately by the corrupt former regime and then squandered quite
privately.
Tunisians had their own one per cent, a thin commercial elite,
half of whom were related to or closely connected to President Ben Ali.
As a group, they were accused by young activists of mafia-like, predatory practices,
such as demanding pay-offs from legitimate businesses, and discouraging foreign
investment by tying it to a stupendous system of bribes. The closed, top-heavy
character of the Tunisian economic system was blamed for the bottom-heavy waves
of suffering that followed: cost of living increases that hit people on fixed
incomes or those like students and peddlers in the marginal economy especially
hard.
It was no happenstance that the young man who
immolated himself and so sparked the Tunisian rebellion was a hard-pressed
vegetable peddler. It's easy now to overlook what clearly ties the beginning
of the Arab Spring to the European Summer and the present American Fall: the
point of the Tunisian revolution was not just to gain political rights, but
to sweep away that one per cent, popularly imagined as a sort of dam against
economic opportunity.
Tahrir Square, Zuccotti Park, Rothschild Avenue
The success of the Tunisian revolution in removing the octopus-like Ben Ali
plutocracy inspired the dramatic events in Egypt, Libya, Yemen, Syria and even
Israel that are redrawing the political map of the Middle East. But the 2011
youth protest movement was hardly contained in the Middle East. Estonian-Canadian
activist Kalle Lasn and his anti-consumerist colleagues at the Vancouver-based
Adbusters Media Foundation
were inspired by the success of the revolutionaries in Tahrir Square in
deposing dictator Hosni Mubarak.
Their organisation specialises in combatting advertising culture through
spoofs and pranks. It was Adbusters magazine that sent out the call
on Twitter in the summer of 2011 for a rally at Wall Street on September 17,
with the now-famous hash tag #OccupyWallStreet. A thousand protesters gathered
on the designated date, commemorating the 2008 economic meltdown that had thrown
millions of Americans out of their jobs and their homes. Some camped out in
nearby Zuccotti Park, another unexpected global spark for protest.
The Occupy Wall Street movement has now spread throughout the United States,
sometimes in the face of serious acts of repression, as in
Oakland, California. It has followed in the spirit of the Arab and European
movements in demanding an end to special privileges for the richest one per
cent, including their ability to more or less buy the US government for purposes
of their choosing. What is often forgotten is that the Ben Alis, Mubaraks and
Gaddafis were not simply authoritarian tyrants. They were the one per
cent and the guardians of the one per cent, in their own societies - and loathed
for exactly that.
Last April, around the time that Lasn began imagining Wall Street protests,
progressive activists in Israel started planning their own movement. In July,
sales clerk and aspiring filmmaker Daphne Leef found herself
unable
to cover a sudden rent increase on her Tel Aviv apartment. So she started
a protest Facebook page similar to the ones that fuelled the Arab Spring and
moved into a tent on the posh Rothschild Avenue where she was soon joined by
hundreds of other protesting Israelis. Week by week, the demonstrations grew,
spreading to cities throughout the country and
culminating on September 3 in a massive rally, the largest in Israel's history.
Some 300,000 protesters came out in Tel Aviv, 50,000 in Jerusalem and 40,000
in Haifa. Their demands
included not just lower housing costs, but a rollback of neoliberal policies,
less regressive taxes and more progressive, direct taxation, a halt to the privatisation
of the economy, and the funding of a system of inexpensive education and child
care.
Many on the left in Israel are also
deeply troubled by the political and economic power of right-wing settlers
on the West Bank, but most decline to bring the Palestinian issue into the movement's
demands for fear of losing support among the middle class. For the same reason,
the way the Israeli movement was inspired by Tahrir Square and the Egyptian
revolution has been downplayed, although
"Walk like an Egyptian" signs - a reference both to the Cairo demonstrations
and the 1986 Bangles hit song - have been spotted on Rothschild Avenue.
Most of the Israeli activists in the coastal cities know that they are victims
of the same neoliberal order that displaces the Palestinians, punishes them
and keeps them stateless. Indeed, the Palestinians, altogether lacking a state
but at the complete mercy of various forms of international capital controlled
by elites elsewhere, are the ultimate victims of the neoliberal order. But in
order to avoid a split in the Israeli protest movement, a quiet agreement was
reached to focus on economic discontents and so avoid the divisive issue of
the much-despised West Bank settlements.
There has been little reporting in the Western press about a key source of
Israeli unease, which was palpable to me when I visited the country in May.
Even then, before the local protests had fully hit their stride, Israelis I
met were complaining about the rise to power of an Israeli one per cent. There
are now
16 billionaires in the country, who control $45bn in assets, and the current
crop of 10,153 millionaires is 20 per cent larger than it was in the previous
fiscal year. In terms of its distribution of wealth, Israel is now among the
most unequal of the countries in the Organisation for Economic Cooperation
and Development. Since the late 1980s, the average household income of families
in the bottom fifth of the population has been declining at an annual rate of
1.1 per cent. Over the same period, the average household income of families
among the richest 20 per cent went up at an annual rate of 2.4 per cent.
While neoliberalism has produced more unequal societies throughout the
world, nowhere else has the income of the poor declined quite so strikingly.
The concentration of wealth in a few hands profoundly contradicts the founding
principles of Israel's Labour Zionism, and results from decades of right-wing
Likud policies punishing the poor and middle classes and shifting wealth to
the top of society.
The indignant ones
European youth were also inspired by the Tunisians and Egyptians - and by
a similar flight of wealth. I was in Barcelona on May 27, when the police attacked
demonstrators camped out at the Placa de Catalunya, provoking widespread consternation.
The government of the region is currently led by the centrist Convergence and
Union Party, a moderate proponent of Catalan nationalism. It is relatively popular
locally, and so Catalans had not expected such heavy-handed police action to
be ordered. The crackdown, however, underlined the very point of the protesters,
that the neoliberal state, whatever its political makeup, is protecting the
same set of wealthy miscreants.
Spain's "indignados" (indignant ones) got
their start in mid-May with huge protests at Madrid's Puerta del Sol Plaza
against the country's persistent 21 per cent unemployment rate (and double that
among the young). Egyptian activists in Tahrir Square
immediately sent a statement of warm support to those in the Spanish capital
(as they would months later to New York's demonstrators). Again following the
same pattern, the Spanish movement does not restrict its objections to unemployment
(and the lack of benefits attending the few new temporary or contract jobs that
do arise). Its targets are the banks, bank bailouts, financial corruption and
cuts in education and other services.
Youth activists I met in Toledo and Madrid this summer
denounced
both of the country's major parties and, indeed, the very consumer society that
emphasised wealth accumulation over community and material acquisition over
personal enrichment. In the past two months Spain's young protesters have concentrated
on demonstrating against cuts to education, with crowds of 70,000 to 90,000
coming out more than once in Madrid and tens of thousands in other cities. For
marches in support of the Occupy Wall Street movement,
hundreds of thousands reportedly took to the streets of Madrid and Barcelona,
among other cities.
The global reach and connectedness of these movements has yet to be fully
appreciated. The Madrid education protesters, for example, cited for inspiration
Chilean students who, through persistent, innovative, and large-scale demonstrations
this summer and fall, have forced that country's neoliberal government, headed
by the increasingly unpopular billionaire president Sebastian Pinera, to inject
$1.6bn in new money into education. Neither the crowds of youth in Madrid nor
those in Santiago are likely to be mollified, however, by new dorms and laboratories.
Chilean students have
already moved on from insisting on an end to an ever more expensive class-based
education system to demands that the country's lucrative copper mines be nationalised
so as to generate revenues for investment in education. In every instance, the
underlying goal of specific protests by the youthful reformists is the neoliberal
order itself.
The word "union" was little uttered in American television news coverage
of the revolutions in Tunisia and Egypt, even though factory workers and sympathy
strikes of all sorts played a
key role in them. The right-wing press in the US actually went out of its
way to contrast Egyptian demonstrations against Mubarak with the Wisconsin rallies
of government workers against Governor Scott Walker's measure to cripple the
bargaining power of their unions.
The Egyptians, Commentary typically
wrote,
were risking their lives, while Wisconsin's union activists were taking the
day off from cushy jobs to parade around with placards, immune from being fired
for joining the rallies. The implication: the Egyptian revolution was against
tyranny, whereas already spoiled American workers were demanding further coddling.
The American right has never been interested in recognising this reality:
that forbidding unions and strikes is a form of tyranny. In fact, it wasn't
just progressive bloggers who saw a connection between Tahrir Square and Madison.
The head of the newly formed independent union federation in Egypt dispatched
an
explicit expression of solidarity to the Wisconsin workers, centering on
worker's rights.
At least,Commentary did us one favour: it clarified
why the story has been told as it has in most of the American media. If the
revolutions in Tunisia, Egypt and Libya were merely about individualistic political
rights - about the holding of elections and the guarantee of due process - then
they could be depicted as largely irrelevant to politics in the US and Europe,
where such norms already prevailed.
If, however, they centered on economic rights (as they certainly did), then
clearly the discontents of North African youth when it came to plutocracy, corruption,
the curbing of workers' rights, and persistent unemployment deeply resembled
those of their American counterparts.
The global protests of 2011 have been cast in the American media largely
as an "Arab Spring" challenging local dictatorships - as though Spain, Chile
and Israel do not exist. The constant speculation by pundits and television
news anchors in the US about whether "Islam" would benefit from the Arab Spring
functioned as an Orientalist way of marking events in North Africa as alien
and vaguely menacing, but also as not germane to the day to day concerns of
working Americans. The inhabitants of Zuccotti Park in lower Manhattan clearly
feel differently.
Facebook flash mobs
If we focus on economic trends, then the neoliberal state looks eerily similar,
whether it is a democracy or a dictatorship, whether the government is nominally
right of centre or left of centre. As a package, deregulation, the privatisation
of public resources and firms, corruption and forms of insider trading and interference
in the ability of workers to organise or engage in collective bargaining have
allowed the top one per cent in Israel, just as in Tunisia or the US, to capture
the lion's share of profits from the growth of the last decades.
Observers were puzzled by the huge crowds that turned out in both Tunis and
Tel Aviv in 2011, especially given that economic growth in those countries had
been running at a seemingly healthy five per cent per annum. "Growth", defined
generally and without regard to its distribution, is the answer to a neoliberal
question. The question of the 99 per cent, however, is: Who is getting the increased
wealth? In both of those countries, as in the US and other neoliberal lands,
the answer is: disproportionately the one per cent.
If you were wondering why outraged young people around the globe are chanting
such similar slogans and using such similar tactics (including Facebook "flash
mobs"), it is because they have seen more clearly than their elders through
the neoliberal shell game.
Juan Cole is the Richard P. Mitchell Professor of History and
the director of the Centre for South Asian Studies at the University of Michigan.
His latest book,
Engaging the Muslim World, is just out in a revised paperback edition from
Palgrave Macmillan. He runs the
Informed Comment website.
A version of this article was first published on
Tom Dispatch.
The views expressed in this article are the author's own and
do not necessarily reflect Al Jazeera's editorial policy.
Yet another response [ to globalization] is that I term 21stcentury fascism.The ultra-right is an insurgent force in many countries. In broad strokes,
this project seeks to fuse reactionary political power with transnational capital
and to organise a mass base among historically privileged sectors of the global
working class – such as white workers in the North and middle layers in the
South – that are now experiencing heightened insecurity and the specter of downward
mobility. It involves militarism, extreme masculinisation, homophobia, racism
and racist mobilisations, including the search for scapegoats, such as immigrant
workers and, in the West, Muslims. Twenty-first century fascism evokes mystifying
ideologies, often involving race/culture supremacy and xenophobia, embracing an
idealised and mythical past. Neo-fascist culture normalises and glamorises warfare
and social violence, indeed, generates a fascination with domination that is portrayed
even as heroic.
Notable quotes:
"... over-accumulation ..."
"... Cyclical crises ..."
"... . Structural crises ..."
"... systemic crisis ..."
"... social reproduction. ..."
"... crisis of humanity ..."
"... 1984 has arrived; ..."
"... The crisis has resulted in a rapid political polarisation in global society. ..."
"... In broad strokes, this project seeks to fuse reactionary political power with transnational capital and to organise a mass base among historically privileged sectors of the global working class ..."
"... It involves militarism, extreme masculinisation, homophobia, racism and racist mobilisations, including the search for scapegoats, such as immigrant workers and, in the West, Muslims. ..."
"... Neo-fascist culture normalises and glamorises warfare and social violence, indeed, generates a fascination with domination that is portrayed even as heroic. ..."
World capitalism is experiencing the worst crisis in its 500 year history.
Global capitalism is a qualitatively new stage in the open ended evolution of
capitalism characterised by the rise of transnational capital, a transnational
capitalist class, and a transnational state. Below, William I. Robinson argues
that the global crisis is structural and threatens to become systemic, raising
the specter of collapse and a global police state in the face of ecological
holocaust, concentration of the means of violence, displacement of billions,
limits to extensive expansion and crises of state legitimacy, and suggests that
a massive redistribution of wealth and power downward to the poor majority of
humanity is the only viable solution.
The New Global Capitalism and the 21st Century Crisis
The world capitalist system is arguably experiencing the worst crisis in
its 500 year history. World capitalism has experienced a profound restructuring
through globalisation over the past few decades and has been transformed in
ways that make it fundamentally distinct from its earlier incarnations. Similarly,
the current crisis exhibits features that set it apart from earlier crises of
the system and raise the stakes for humanity. If we are to avert disastrous
outcomes we must understand both the nature of the new global capitalism and
the nature of its crisis. Analysis of capitalist globalisation provides a template
for probing a wide range of social, political, cultural and ideological processes
in this 21st century. Following Marx, we want to focus on the internal dynamics
of capitalism to understand crisis. And following the global capitalism perspective,
we want to see how capitalism has qualitatively evolved in recent decades.
The system-wide crisis we face is not a repeat of earlier such episodes such
as that of the the 1930s or the 1970s precisely because capitalism is fundamentally
different in the 21st century. Globalisation constitutes a qualitatively new
epoch in the ongoing and open-ended evolution of world capitalism, marked by
a number of qualitative shifts in the capitalist system and by novel articulations
of social power. I highlight four aspects unique to this epoch.1
First is the rise of truly transnational capital and a new global production
and financial system into which all nations and much of humanity has been integrated,
either directly or indirectly. We have gone from a world economy, in
which countries and regions were linked to each other via trade and financial
flows in an integrated international market, to a global economy, in
which nations are linked to each more organically through the transnationalisation
of the production process, of finance, and of the circuits of capital accumulation.
No single nation-state can remain insulated from the global economy or prevent
the penetration of the social, political, and cultural superstructure of global
capitalism. Second is the rise of a Transnational Capitalist Class (TCC), a
class group that has drawn in contingents from most countries around the world,
North and South, and has attempted to position itself as a global ruling class.
This TCC is the hegemonic fraction of capital on a world scale. Third
is the rise of Transnational State (TNS) apparatuses. The TNS is constituted
as a loose network made up of trans-, and supranational organisations together
with national states. It functions to organise the conditions for transnational
accumulation. The TCC attempts to organise and institutionally exercise its
class power through TNS apparatuses. Fourth are novel relations of inequality,
domination and exploitation in global society, including an increasing importance
of transnational social and class inequalities relative to North-South inequalities.
Cyclical, Structural, and Systemic Crises
Most commentators on the contemporary crisis refer to the "Great Recession"
of 2008 and its aftermath. Yet the causal origins of global crisis are to be
found in over-accumulation and also in contradictions of state
power, or in what Marxists call the internal contradictions of the capitalist
system. Moreover, because the system is now global, crisis in any one place
tends to represent crisis for the system as a whole. The system cannot expand
because the marginalisation of a significant portion of humanity from direct
productive participation, the downward pressure on wages and popular consumption
worldwide, and the polarisation of income, has reduced the ability of the world
market to absorb world output. At the same time, given the particular configuration
of social and class forces and the correlation of these forces worldwide, national
states are hard-pressed to regulate transnational circuits of accumulation and
offset the explosive contradictions built into the system.
Is this crisis cyclical, structural, or systemic? Cyclical crises
are recurrent to capitalism about once every 10 years and involve recessions
that act as self-correcting mechanisms without any major restructuring of the
system. The recessions of the early 1980s, the early 1990s, and of 2001 were
cyclical crises. In contrast, the 2008 crisis signaled the slide into astructural
crisis. Structural crises reflect deeper contradictions that can only
be resolved by a major restructuring of the system. The structural crisis of
the 1970s was resolved through capitalist globalisation. Prior to that, the
structural crisis of the 1930s was resolved through the creation of a new model
of redistributive capitalism, and prior to that the structural crisis of the
1870s resulted in the development of corporate capitalism. A systemic crisis
involves the replacement of a system by an entirely new system or
by an outright collapse. A structural crisis opens up the possibility
for a systemic crisis. But if it actually snowballs into a systemic crisis –
in this case, if it gives way either to capitalism being superseded or to a
breakdown of global civilisation – is not predetermined and depends entirely
on the response of social and political forces to the crisis and on historical
contingencies that are not easy to forecast. This is an historic moment of extreme
uncertainty, in which collective responses from distinct social and class forces
to the crisis are in great flux.
Hence my concept of global crisis is broader than financial. There are multiple
and mutually constitutive dimensions – economic, social, political, cultural,
ideological and ecological, not to mention the existential crisis of our consciousness,
values and very being. There is a crisis of social polarisation, that is, of
social reproduction. The system cannot meet the needs or assure the
survival of millions of people, perhaps a majority of humanity. There are crises
of state legitimacy and political authority, or of hegemony and
domination. National states face spiraling crises of legitimacy as they
fail to meet the social grievances of local working and popular classes experiencing
downward mobility, unemployment, heightened insecurity and greater hardships.
The legitimacy of the system has increasingly been called into question by millions,
perhaps even billions, of people around the world, and is facing expanded counter-hegemonic
challenges. Global elites have been unable counter this erosion of the system's
authority in the face of worldwide pressures for a global moral economy. And
a canopy that envelops all these dimensions is a crisis of sustainability rooted
in an ecological holocaust that has already begun, expressed in climate change
and the impending collapse of centralised agricultural systems in several regions
of the world, among other indicators.
By a crisis of humanity I mean a crisis that is approaching systemic
proportions, threatening the ability of billions of people to survive, and raising
the specter of a collapse of world civilisation and degeneration into a new
"Dark Ages."2
Global capitalism now couples human and natural history in such a way
as to threaten to bring about what would be the sixth mass extinction in the
known history of life on earth.
This crisis of humanity shares a
number of aspects with earlier structural crises but there are also several
features unique to the present:
The system is fast reaching the ecological limits of its reproduction.
Global capitalism now couples human and natural history in such a way as
to threaten to bring about what would be the sixth mass extinction in the
known history of life on earth.3 This mass extinction would
be caused not by a natural catastrophe such as a meteor impact or by evolutionary
changes such as the end of an ice age but by purposive human activity. According
to leading environmental scientists there are nine "planetary boundaries"
crucial to maintaining an earth system environment in which humans can exist,
four of which are experiencing at this time the onset of irreversible environmental
degradation and three of which (climate change, the nitrogen cycle, and
biodiversity loss) are at "tipping points," meaning that these processes
have already crossed their planetary boundaries.
The magnitude of the means of violence and social control is unprecedented,
as is the concentration of the means of global communication and symbolic
production and circulation in the hands of a very few powerful groups.
Computerised wars, drones, bunker-buster bombs, star wars, and so forth,
have changed the face of warfare. Warfare has become normalised and sanitised
for those not directly at the receiving end of armed aggression. At the
same time we have arrived at the panoptical surveillance society and the
age of thought control by those who control global flows of communication,
images and symbolic production. The world of Edward Snowden is the world
of George Orwell; 1984 has arrived;
Capitalism is reaching apparent limits to its extensive
expansion. There are no longer any new territories of significance that
can be integrated into world capitalism, de-ruralisation is now well advanced,
and the commodification of the countryside and of pre- and non-capitalist
spaces has intensified, that is, converted in hot-house fashion into spaces
of capital, so that intensive expansion is reaching depths never
before seen. Capitalism must continually expand or collapse. How or where
will it now expand?
There is the rise of a vast surplus population inhabiting a "planet
of slums,"4 alienated from the productive economy, thrown
into the margins, and subject to sophisticated systems of social control
and to destruction – to a mortal cycle of dispossession-exploitation-exclusion.
This includes prison-industrial and immigrant-detention complexes, omnipresent
policing, militarised gentrification, and so on;
There is a disjuncture between a globalising economy and a nation-state
based system of political authority. Transnational state apparatuses
are incipient and have not been able to play the role of what social scientists
refer to as a "hegemon," or a leading nation-state that has enough power
and authority to organise and stabilise the system. The spread of weapons
of mass destruction and the unprecedented militarisation of social life
and conflict across the globe makes it hard to imagine that the system can
come under any stable political authority that assures its reproduction.
Global Police State
How have social and political forces worldwide responded to crisis? The
crisis has resulted in a rapid political polarisation in global society.
Both right and left-wing forces are ascendant. Three responses seem to be in
dispute.
One is what we could call "reformism from above." This elite reformism is
aimed at stabilising the system, at saving the system from itself and from more
radical responses from below. Nonetheless, in the years following the 2008 collapse
of the global financial system it seems these reformers are unable (or unwilling)
to prevail over the power of transnational financial capital. A second response
is popular, grassroots and leftist resistance from below. As social and political
conflict escalates around the world there appears to be a mounting global revolt.
While such resistance appears insurgent in the wake of 2008 it is spread very
unevenly across countries and regions and facing many problems and challenges.
Yet another response is that I term 21stcentury fascism.5
The ultra-right is an insurgent force in many countries. In broad
strokes, this project seeks to fuse reactionary political power with transnational
capital and to organise a mass base among historically privileged sectors of
the global working class – such as white workers in the North and middle
layers in the South – that are now experiencing heightened insecurity and the
specter of downward mobility. It involves militarism, extreme masculinisation,
homophobia, racism and racist mobilisations, including the search for scapegoats,
such as immigrant workers and, in the West, Muslims. Twenty-first century
fascism evokes mystifying ideologies, often involving race/culture supremacy
and xenophobia, embracing an idealised and mythical past. Neo-fascist culture
normalises and glamorises warfare and social violence, indeed, generates a fascination
with domination that is portrayed even as heroic.
The need for dominant groups around the world to secure widespread, organised
mass social control of the world's surplus population and rebellious forces
from below gives a powerful impulse to projects of 21st century fascism. Simply
put, the immense structural inequalities of the global political economy cannot
easily be contained through consensual mechanisms of social control. We have
been witnessing transitions from social welfare to social control states around
the world. We have entered a period of great upheavals, momentous changes and
uncertainties. The only viable solution to the crisis of global capitalism is
a massive redistribution of wealth and power downward towards the poor majority
of humanity along the lines of a 21st century democratic socialism, in which
humanity is no longer at war with itself and with nature.
About the Author
William I. Robinson is professor of sociology, global and
international studies, and Latin American studies, at the University of California-Santa
Barbara. Among his many books are Promoting Polyarchy (1996),
Transnational Conflicts (2003), A Theory of Global Capitalism
(2004), Latin America and Global Capitalism (2008),
and
Global Capitalism and the Crisis of Humanity (2014).
This
article outlines the main elements of
rupture and continuity in the global political economy since the global
economic crisis of
2008-2009. While the current calamity poses a more systemic challenge to
neoliberal
globalization than genetically similar turbulences in the
semi-periphery during the 1990s, we find that evidence for its
transformative significance remains mixed. Efforts to reform the distressed
capitalist models in the North encounter severe resistance, and the
broadened multilateralism of the G-20 is yet
to provide effective global economic governance. Overall,
neoliberal
globalization looks set to survive, but in more heterodox and
multipolar fashion. Without tighter coordination between old and emerging
powers, this new synthesis is unlikely to inspire lasting solutions to
pressing global problems such as an unsustainable international financial
architecture and the pending environmental catastrophe, and may even fail to
preserve some modest democratic and developmental gains
of the recent past.
"... I think Trump is afraid the imperial global order presided by the US is about to crash and thinks he will be able to steer the country into a soft landing by accepting that other world powers have interests, by disengaging from costly and humiliating military interventions, by re-negotiating trade deals, and by stopping the mass immigration of poor people. Plus a few well-placed bombs ..."
"... Much has been written about the internet revolution, about the impact of people having access to much more information than before. The elite does not recognize this and is still organizing political and media campaigns as if it were 1990, relying on elder statesmen like Blair, Bush, Mitterrand, Clinton, and Obama to influence public opinion. They are failing miserably, to the point of being counterproductive. ..."
"... I don't think something as parochial as racism is sustaining Trump, but rather the fear of the loss of empire by a population with several orders of magnitude more information and communication than in 2008, even 2012. ..."
"... No one has literally argued that people should be glad to lose employment: that part was hyperbole. But the basic argument is often made quite seriously. See e.g. outsource Brad DeLong . ..."
"... The same thing has happened in Mexico with neoliberal government after neoliberal government being elected. There are many democratically elected neoliberal governments around the world. ..."
"... In the case of Mexico, because Peña Nieto's wife is a telenovela star. How cool is that? It places Mexico in the same league as 1st world countries, such as France, with Carla Bruni. ..."
"... To the guy who asked- poor white people keep voting Republican even though it screws them because they genuinely believe that the country is best off when it encourages a culture of "by the bootstraps" self improvement, hard work, and personal responsibility. They view taxing people in order to give the money to the supposedly less fortunate as the anti thesis of this, because it gives people an easy out that let's them avoid having to engage in the hard work needed to live independently. ..."
"... The extent to which "poor white people" vote against their alleged economic interests is overblown. To a large extent, they do not vote at all nor is anyone or anything on the ballot to represent their interests. And, yes, they are misinformed systematically by elites out to screw them and they know this, but cannot do much to either clear up their own confusion or fight back. ..."
"... The mirror image problem - of elites manipulating the system to screw the poor and merely middle-class - is daily in the news. Both Presidential candidates have been implicated. So, who do you recommend they vote for? ..."
"... I think you're missing Patrick's point. These voters are switching from one Republican to another. They've jettisoned Bush et. al. for Trump. These guys despise Bush. ..."
"... They've figured out that the mainstream party is basically 30 years of affinity fraud. ..."
"... My understanding is trumps support disproportionately comes from the small business owning classes, Ie a demographic similar to the petite bourgeoisie who have often been heavily involved in reactionary movements. This gets oversold as "working class" when class is defined by education level rather than income. ..."
"... Layman - Why are these voters switching from Bush et al to Trump? Once again, Corey's whole point is that there is very little difference between the racism of Trump and the mainstream party since Nixon. Is Trump just more racist? Or are the policies of Trump resonating differently than Bush for reasons other than race? ..."
"... Eric Berne, in The Structures and Dynamics of Organizations and Groups, proposed that among the defining characteristics of a coherent group is an explicit boundary which determines whether an individual is a member of the group or not. (If there is no boundary, nothing binds the assemblage together; it is a crowd.) The boundary helps provide social cohesion and is so important that groups will create one if necessary. Clearly, boundaries exclude as well as include, and someone must play the role of outsider. ..."
"... For a time, the balkanization of American political communities by race, religion and ethnicity was an effective means to the dominance of an tiny elite with ties to an hegemonic community, but it backfired. Dismantling that balkanization has left the country with a very low level of social affiliation and thus a low capacity to organize resistance to elite depredations. ..."
I think Trump is afraid the imperial global order presided by the US is about to crash
and thinks he will be able to steer the country into a soft landing by accepting that other world
powers have interests, by disengaging from costly and humiliating military interventions, by re-negotiating
trade deals, and by stopping the mass immigration of poor people. Plus a few well-placed bombs
.
Much has been written about the internet revolution, about the impact of people having
access to much more information than before. The elite does not recognize this and is still organizing
political and media campaigns as if it were 1990, relying on elder statesmen like Blair, Bush,
Mitterrand, Clinton, and Obama to influence public opinion. They are failing miserably, to the
point of being counterproductive.
I don't think something as parochial as racism is sustaining Trump, but rather the fear
of the loss of empire by a population with several orders of magnitude more information and communication
than in 2008, even 2012.
Layman 08.04.16 at 11:59 am
Rich P: "Neoliberals often argue that people should be glad to lose employment at 50 so
that people from other countries can have higher incomes "
I doubt this most sincerely. While this may be the effect of some neoliberal policies, I can't
recall any particular instance where someone made this argument.
Rich Puchalsky 08.04.16 at 12:03 pm
"I can't recall any particular instance where someone made this argument."
No one has literally argued that people should be glad to lose employment: that part was
hyperbole. But the basic argument is often made quite seriously. See e.g.
outsource
Brad DeLong .
engels 08.04.16 at 12:25 pm
While this may be the effect of some neoliberal policies, I can't recall any particular instance
where someone made this argument
Maybe this kind of thing rom Henry Farrell? (There may well be better examples.)
Is some dilution of the traditional European welfare state acceptable, if it substantially
increases the wellbeing of current outsiders (i.e. for example, by bringing Turkey into the club).
My answer is yes, if European leftwingers are to stick to their core principles on justice, fairness,
egalitarianism etc
Large numbers of low-income white southern Americans consistently vote against their
own economic interests. They vote to award tax breaks to wealthy people and corporations, to
cut unemployment benefits, to bust unions, to reward companies for outsourcing jobs, to resist
wage increases, to cut funding for health care for the poor, to cut Social Security and Medicare,
etc.
The same thing has happened in Mexico with neoliberal government after neoliberal government
being elected. There are many democratically elected neoliberal governments around the world.
Why might this be?
In the case of Mexico, because Peña Nieto's wife is a telenovela star. How cool is that?
It places Mexico in the same league as 1st world countries, such as France, with Carla Bruni.
Patrick 08.04.16 at 4:32 pm
To the guy who asked- poor white people keep voting Republican even though it screws them
because they genuinely believe that the country is best off when it encourages a culture of "by
the bootstraps" self improvement, hard work, and personal responsibility. They view taxing people
in order to give the money to the supposedly less fortunate as the anti thesis of this, because
it gives people an easy out that let's them avoid having to engage in the hard work needed to
live independently.
They see it as little different from letting your kid move back on after college and smoke
weed in your basement. They don't generally mind people being on unemployment transitionally,
but they're supposed to be a little embarrassed about it and get it over with as soon as possible.
They not only worry that increased government social spending will incentivize bad behavior, they
worry it will destroy the cultural values they see as vital to Americas past prosperity. They
tend to view claims about historic or systemic injustice necessitating collective remedy because
they view the world as one in which the vagaries of fate decree that some are born rich or poor,
and that success is in improving ones station relative to where one starts. Attempts at repairing
historical racial inequity read as cheating in that paradigm, and even as hostile since they can
easily observe white people who are just as poor or poorer than those who racial politics focuses
upon. Left wing insistence on borrowing the nastiest rhetoric of libertarians ("this guy is poor
because his ancestors couldn't get ahead because of historical racial injustice so we must help
him; your family couldn't get ahead either but that must have been your fault so you deserve it")
comes across as both antithetical to their values and as downright hostile within the values they
see around them.
All of this can be easily learned by just talking to them.
It's not a great world view. It fails to explain quite a lot. For example, they have literally
no way of explaining increased unemployment without positing either that everyone is getting too
lazy to work, or that the government screwed up the system somehow, possibly by making it too
expensive to do business in the US relative to other countries. and given their faith in the power
of hard work, they don't even blame sweatshops- they blame taxes and foreign subsidies.
I don't know exactly how to reach out to them, except that I can point to some things people
do that repulse them and say "stop doing that."
bruce wilder 08.04.16 at 5:50 pm
The extent to which "poor white people" vote against their alleged economic interests is
overblown. To a large extent, they do not vote at all nor is anyone or anything on the ballot
to represent their interests. And, yes, they are misinformed systematically by elites out to screw
them and they know this, but cannot do much to either clear up their own confusion or fight back.
The mirror image problem - of elites manipulating the system to screw the poor and merely
middle-class - is daily in the news. Both Presidential candidates have been implicated. So, who
do you recommend they vote for?
There is serious deficit of both trust and information among the poor. Poor whites hardly have
a monopoly; black misleadership is epidemic in our era of Cory Booker socialism.
bruce wilder 08.04.16 at 7:05 pm
Politics is founded on the complex social psychology of humans as social animals. We elevate
it from its irrational base in emotion to rationalized calculation or philosophy at our peril.
T 08.04.16 at 9:17 pm
@Layman
I think you're missing Patrick's point. These voters are switching from one Republican
to another. They've jettisoned Bush et. al. for Trump. These guys despise Bush.
They've figured out that the mainstream party is basically 30 years of affinity fraud.
So, is your argument is that Trump even more racist? That kind of goes against the whole point
of the OP. Not saying that race doesn't matter. Of course it does. But Trump has a 34% advantage
in non-college educated white men. It just isn't the South. Why does it have to be just race or
just class?
Ronan(rf) 08.04.16 at 10:35 pm
"I generally don't give a shit about polls so I have no "data" to evidence this claim, but
my guess is the majority of Trump's support comes from this broad middle"
My understanding is trumps support disproportionately comes from the small business owning
classes, Ie a demographic similar to the petite bourgeoisie who have often been heavily involved
in reactionary movements. This gets oversold as "working class" when class is defined by education
level rather than income.
This would make some sense as they are generally in economically unstable jobs, they tend to
be hostile to both big govt (regulations, freeloaders) and big business (unfair competition),
and while they (rhetorically at least) tend to value personal autonomy and self sufficiency ,
they generally sell into smaller, local markets, and so are particularly affected by local demographic
and cultural change , and decline. That's my speculation anyway.
T 08.05.16 at 3:12 pm
@patrick @layman
Patrick, you're right about the Trump demographic. https://fivethirtyeight.com/features/the-mythology-of-trumps-working-class-support/
Layman - Why are these voters switching from Bush et al to Trump? Once again, Corey's whole
point is that there is very little difference between the racism of Trump and the mainstream party
since Nixon. Is Trump just more racist? Or are the policies of Trump resonating differently than
Bush for reasons other than race?
Are the folks that voted for the other candidates in the primary less racist so Trump supporters
are just the most racist among Republicans? Cruz less racist? You have to explain the shift within
the Republican party because that's what happened.
Anarcissie 08.06.16 at 3:00 pm
Faustusnotes 08.06.16 at 1:50 pm @ 270 -
Eric Berne, in The Structures and Dynamics of Organizations and Groups, proposed that among
the defining characteristics of a coherent group is an explicit boundary which determines whether
an individual is a member of the group or not. (If there is no boundary, nothing binds the assemblage
together; it is a crowd.) The boundary helps provide social cohesion and is so important that
groups will create one if necessary. Clearly, boundaries exclude as well as include, and someone
must play the role of outsider. While Berne's theories are a bit too nifty for me to love
them, I have observed a lot of the behaviors he predicts. If one wanted to be sociobiological,
it is not hard to hypothesize evolutionary pressures which could lead to this sort of behavior
being genetically programmed. If a group of humans, a notably combative primate, does not have
strong social cohesion, the war of all against all ensues and everybody dies. Common affections
alone do not seem to provide enough cohesion.
In an earlier but related theory, in the United States, immigrants from diverse European communities
which fought each other for centuries in Europe arrived and managed to now get along because they
had a major Other, the Negro, against whom to define themselves (as the White Race) and thus to
cohere sufficiently to get on with business. The Negro had the additional advantage of being at
first a powerless slave and later, although theoretically freed, was legally, politically, and
economically disabled - an outsider who could not fight back very effectively, nor run away. Even
so, the US almost split apart and there continue to be important class, ethnic, religious, and
regional conflicts. You can see how these two theories resonate.
It may be that we can't have communities without this dark side, although we might be able
to mitigate some of its destructive effects.
bruce wilde r 08.06.16 at 4:28 pm
I am somewhat suspicious of leaving dominating elites out of these stories of racism as an
organizing principle for political economy or (cultural) community.
Racism served the purposes of a slaveholding elite that organized political communities to
serve their own interests. (Or, vis a vis the Indians a land-grab or genocide.)
Racism serves as an organizing principle. Politically, in an oppressive and stultifying hierarchy
like the plantation South, racism not incidentally buys the loyalty of subalterns with ersatz
status. The ugly prejudices and resentful arrogance of working class whites is thus a component
of how racism works to organize a political community to serve a hegemonic master class. The business
end of racism, though, is the autarkic poverty imposed on the working communities: slaves, sharecroppers,
poor blacks, poor whites - bad schools, bad roads, politically disabled communities, predatory
institutions and authoritarian governments.
For a time, the balkanization of American political communities by race, religion and ethnicity
was an effective means to the dominance of an tiny elite with ties to an hegemonic community,
but it backfired. Dismantling that balkanization has left the country with a very low level of
social affiliation and thus a low capacity to organize resistance to elite depredations.
engels 08.07.16 at 1:02 am
But how did that slavery happen
Possible short answer: the level of technological development made slavery an efficient way
of exploiting labour. At a certain point those conditions changed and slavery became a drag on
further development and it was abolished, along with much of the racist ideology that legitimated
it.
Lupita 08.07.16 at 3:40 am
But how did that slavery happen
In Mesoamerica, all the natives were enslaved because they were conquered by the Spaniards.
Then, Fray Bartolomé de las Casas successfully argued before the Crown that the natives had souls
and, therefore, should be Christianized rather than enslaved. As Bruce Wilder states, this did
not serve the interests of the slaveholding elite, so the African slave trade began and there
was no Fray Bartolomé to argue their case.
It is interesting that while natives were enslaved, the Aztec aristocracy was shipped to Spain
to be presented in court and study Latin. This would not have happened if the Mesoamericans were
considered inferior (soulless) as a race. Furthermore, the Spaniards needed the local elite to
help them out with their empire and the Aztecs were used to slavery and worse. This whole story
can be understood without recurring to racism. The logic of empire suffices.
The current
turmoil within Republican Party is connected with shirking of middle class by neoliberalism.
So peons are now less inclined to support top 0.1%.
Notable quotes:
"... Trump is a billionaire, but his base of support rests among the people once identified by the sociologist Donald Warren as "middle American radicals." Nearly 40 years ago, Warren's idea was adapted by the hard-right political thinker Sam Francis as the basis for paleoconservatism-a conservatism very unlike that of the postwar conservative movement, one that would champion the class interests and cultural attitudes of middle- and lower-income whites. ..."
"... the Democratic Leadership Council, the policy group that paved the way for Bill Clinton's nomination, was founded in 1985 precisely to move the Democratic Party toward "market-based solutions. ..."
"... That economic populism should find a foothold in both parties after the Great Recession and eight years of lagging prosperity under Barack Obama is not entirely surprising. What is more remarkable is the weakness of the bipartisan establishment, whose conventional wisdom is no longer meekly accepted by the rank and file of either party. Every Republican except Trump has tried, to one degree or another, to present himself as a champion of conservative orthodoxy. But that orthodoxy no longer commands the loyalty of a sufficient number of voters to preclude a phenomenon like Trump. Nor does DLC-style neoliberalism appear to be the consensus among Democrats any longer. ..."
"... A void is opening in American politics, and Trump and Sanders are only the first to try to fill it. Neither of them may succeed. Yet it is hard to see any source of renewal for the crumbling establishment they are fighting to replace. ..."
"... "At times like these, it is important to know what to conserve, which is not a label or ideology, but a healthy and humane republic. " ..."
"... There are several holes in the 2016 is ending the Neoliberal changes: ..."
"... Sanders road to the nomination is limited and HRC is taking 65 – 70% next week. Sanders had a good run but the Democratics winnowed down to two candidates in October. ..."
"... Finally, isn't the neoliberalism built on the changes made in the Reagan Revolution? ..."
"... I don't see as strong of a break from orthodoxy in the Democrat party. Hillary will win the nomination and will validate within the Democrat party the ideology of spreading the democracy gospel around the world through force, and the domestic policy of open borders for future Democrat voters. Its less certain that she will win the general election. ..."
"... To save the republic and constitutional government, these wars in the Middle East and elsewhere must be ended, we must get out of that region, and the government must be made to perform the basic duty of securing our own borders and finding and expelling those here illegally. ..."
"... A government perpetually at war is a danger to the republic. It has squandered our money and blood in foreign adventures half way around the world and undermined our liberties and dignity here at home while shirking its own basic duty. ..."
"... The source of all of this republic's woes is an absence of competent, responsible leadership. Neither of the 2 government parties has come close to providing this at the national level. ..."
"... One difference between Trump an Sanders is that The Democrat Washington Establishment is beginning to show Sanders and his supporters the door, where The GOP Washington Establishment is beginning to be shown the door by Trump and his supporters. ..."
"... The Cubano Twins, Tweedledum and Tweedledee appear to be a pair of Neoconservative Big Money Donor Financed Bookends. ..."
"... Occupy is dead, Sanders is dying, and the Democrats will soon be a wholly owned subsidiary of Clinton Inc. ..."
"... I'm sorry folks. Reaganomics is the era we may see coming to an end – perhaps. And what did Bush Senior call it?: 'Voodoo Economics.' ..."
"... But Reagan succeeded in creating massive deficits and building up a military that was then primed for war. He was absolutely counter to Dwight Eisenhower in almost every respect (who was arguably the last Great Republican President). ..."
"... The rise of Wall Street and unregulated finance also took place under Reagan's watch. Declining investment in infrastructure. The power of lobbyists became massive in the 80s after being relatively tame prior. This all set the stage. ..."
"... That economic populism should find a foothold in both parties after the Great Recession and eight years of lagging prosperity under Barack Obama is not entirely surprising. ..."
"... "Every Republican except Trump has tried, to one degree or another, to present himself as a champion of conservative orthodoxy." ..."
"... I am not inclined to give the "Tea Party much credit. They have been part of the very problem. ..."
"... Sadly, I think it is accurate that blacks have come to the rescue of Sec. Clinton. It is sad, but it is understandable. ..."
"... Pres. Reagan has been saddled with the term "Reaganonmics". When in fact, it never existed as designed and as result was never fully implemented. Reality got in the way and as such subverted a good deal of the intent. It is incorrect to posit the model as top down. The model is as old as the country – keep money in people's hands and it will flow and redistribute throughout the country. There's just no incentives created for those with the most to reinvest in their community the US. ..."
"... I think the observations concerning how the financial industry have been totally unaccountable to the law, best practices and basic math are spot on. I embrace WS, but they cannot become so unmoored from the country that has bestowed luxurious benefits (loopholes) as to operate outside that frame without consequence. I am unsure of the monetary efficacy that investing in investing. If one is going bandy about "law and order" then to have any genuine legs – it's an across the board application. ..."
This year is shaping up to be the most unconventional moment in American politics
in a generation.
A race that mere months ago seemed to promise yet another Bush vs. another
Clinton has so far given us instead the populist insurgencies of Bernie Sanders
and Donald Trump. Whether or not either of them gets his party's nomination,
the neoliberal consensus of the past two decades seems about to shatter. Free
trade, immigration, waging war for democracy, and even the relative merits of
capitalism and "democratic socialism" have all come into question. Perhaps more
fundamentally, so has the right of Clintons and Bushes-and those like them-to
rule.
Trump is a billionaire, but his base of support rests among the people
once identified by the sociologist Donald Warren as "middle American radicals."
Nearly 40 years ago, Warren's idea was adapted by the hard-right political thinker
Sam Francis as the basis for paleoconservatism-a conservatism very unlike that
of the postwar conservative movement, one that would champion the class interests
and cultural attitudes of middle- and lower-income whites. The Pat Buchanan
presidential campaigns of 1992 and 1996 put Francis's ideas to the test. They
fell short of propelling Buchanan to the GOP nomination, and by the end of the
1990s there was nary a trace of paleo ideology to be found among conservatives
or Republicans. The return of the Bush family to power in 2000 seemed to confirm
that nothing had changed after a decade of skirmishes.
Now suddenly there's Trump. And on the left, there's Sanders, a throwback
to a time when progressives embraced the socialist label. That had fallen out
of fashion even before the end of the Cold War-indeed, the Democratic Leadership
Council, the policy group that paved the way for Bill Clinton's nomination,
was founded in 1985 precisely to move the Democratic Party toward "market-based
solutions."
That economic populism should find a foothold in both parties after the
Great Recession and eight years of lagging prosperity under Barack Obama is
not entirely surprising. What is more remarkable is the weakness of the bipartisan
establishment, whose conventional wisdom is no longer meekly accepted by the
rank and file of either party. Every Republican except Trump has tried, to one
degree or another, to present himself as a champion of conservative orthodoxy.
But that orthodoxy no longer commands the loyalty of a sufficient number of
voters to preclude a phenomenon like Trump. Nor does DLC-style neoliberalism
appear to be the consensus among Democrats any longer.
A void is opening in American politics, and Trump and Sanders are only
the first to try to fill it. Neither of them may succeed. Yet it is hard to
see any source of renewal for the crumbling establishment they are fighting
to replace. Just as the end of the Cold War marked the passing of an era,
and partially or wholly transformed the left and right alike, so another era
is drawing to a close now, with further political mutations to come. Trump and
Sanders need not be the future, but what Bush and Clinton represent is already
past-no matter who wins in November.
Conservatives of Burkean temperament view all of this warily. There is an
opportunity here to replace stale ideologies with a prudence that is ultimately
more principled than any mere formula can be. But there is also the risk that
the devil we know is only making way for another we don't. At times like these,
it is important to know what to conserve, which is not a label or ideology,
but a healthy and humane republic.
"At times like these, it is important to know what to conserve,
which is not a label or ideology, but a healthy and humane republic.
"
Amen.
My people have been here for hundreds of years, and I love my country
with a depth of feeling that is difficult to convey. Our hard-pressed republic
is our most precious possession, and it must be defended and shepherded
through the coming peril. That will require wisdom, strength, and courage,
and all the little platoons.
will require wisdom, strength, and courage, and all the little platoons.
"At times like these, it is important to know what to conserve …."
I think a lot of thoughtful Americans know what to conserve: the constitution.
With the possible exception of the Second Amendment, the constitution has
been virtually torched in its entirety. I just have to shake my head when
I listen to the debate over whether or not Apple should be required by law
to write a program to destroy the feature on its multi-million dollar product,
the iPhone, for which consumers buy it - security in their private information
and communication. And the Fourth Amendment, be damned.
How comes it that America - of all countries - is having that debate?
Were all those American security agencies always that amoral and I just
didn't notice?
The American constitution is not an instruction manual, it's a statement
of principles - fundamental principles upon which the massive superstructure
of law rests. Torch the constitution and it suddenly becomes easy not to
call to account those leaders who authorize and order torture, those bankers
who bring the world economy to its knees through fraud, those presidents
who commit war crimes through the practice of drone-murdering people because
they are merely suspected of terrorism. And it's just as easy to disenfranchise
voters with impunity by arguing on the basis of a rash of voter fraud that
everyone knows does not exist.
If the country no longer recognizes a constitution upon which laws prohibiting
on pain of punishment these and other crimes against democracy, then what
you've got is a nation of men - barbarians living in a state of nature -
not a nation of laws.
I agree with this editorial, but, as delia ruhe points out, this republic
has not been "healthy and humane" for quite some time. It's time for a national
renewal. I never thought Trump would be the agent of this renewal. There's
plenty to dislike about him, but if he's what it takes to right the ship
and either restore a "healthy and humane" republic or create the conditions
for someone else to do so afterwards, then so be it.
There are several holes in the 2016 is ending the Neoliberal changes:
1) Sanders road to the nomination is limited and HRC is taking 65
– 70% next week. Sanders had a good run but the Democratics winnowed down
to two candidates in October.
2) Why is Trump that much different that Perot? The Perot movement was
minimized by a strong economy and the unemployment rate is getting low in
2016.
3) What if there isn't another Trump? To whip the radical middle took
Trump to pull additional voters, there might not be another in 2020.
4) Is the number of radical middle voters slightly decreasing every election
cycle?
5) Finally, isn't the neoliberalism built on the changes made in
the Reagan Revolution?
I don't see as strong of a break from orthodoxy in the Democrat party.
Hillary will win the nomination and will validate within the Democrat party
the ideology of spreading the democracy gospel around the world through
force, and the domestic policy of open borders for future Democrat voters.
Its less certain that she will win the general election.
Want to solve the political-economy differences between citizens of collectivist
and individualist temperament? Eliminate all tax exemptions secretly written
into the tax code for individuals and organizations (they are identified
by language that applies only to that individual or organization), then
invest the proceeds for five years into a sovereign wealth trust fund that
pays $25,000 per year, adjusted for inflation, to all legal citizens beginning
at age 21 (or pass legislation directing the Federal Reserve to deposit
$10 Trillion dollars directly into the fund-quantitative easing for the
people, if you will).
This money would be used by citizens to cover life-cycle risk to income
from any source: job loss, divorce, illness, transportation and home repairs,
macroeconomic chaos, or anything else life throws as a person. The funds
would be retrievable as a person chooses: yearly, monthly, weekly, or in
a $50,000 lump sum once every three years. In addition, replace all income-based
taxes for individuals and organizations with a .005% tax on all transactions
cleared through the banking system, similar to the automated payments transaction
tax advocated by Wisconsin professor Edgar Feige. This would allow the supply
of products and services to roughly match the increased demand generated
by the basic income guarantee, thereby avoiding or mitigating the business
cycle and inflationary source of current economic problems.
The precise mechanism for this proposal is based on the Alaska Permanent
Fund dividend program, which takes monies from state-owned oil fields and
invests prudently in a diverse portfolio world-wide. In turn, this concept
is based on the "topsy-turvy nationalization" idea proposed by English economist
James E. Meade, who suggested governments purchase a 50% share of all publicly-traded
stocks, then pay a "social dividend" (Social Security for All) out of the
earnings from these investments to all citizens. Professor James A. Yunker
proposed a similar idea in his book Pragmatic Market Socialism, finding
under a general equilibrium analysis that output and equity, as measured
by a utilitarian social welfare function, both increased when income smoothing
was financed by pre-distributed social dividends rather than by increased
taxes.
Under this proposal, both conservatives and liberals would achieve what
they say they desire: non-paternalistic held for people's income fluctuations
for liberals, and real incentives to invest and work for conservatives.
Some might say this mechanism for socializing both risk and reward cannot
be implemented, as human nature suggests that people might not accept a
policy that also benefits rivals. Nonetheless, if we want a political-economic
modus vivendi, here is a solution.
Of course, there would still be problems faced by out society, and "solving"
the economic aspect of our malaise will not by itself generate nirvana.
But give people and organizations real security that does not also support
apathy (i.e., both equity and efficiency, as the economist call it), and
you would go a long way towards making the culture war less harsh (it is
mostly based on economic fears projected onto the "other"). In the socio-political
complex, one must honor humanity as it is , not as we wish, or are comfortable
with in our own lives. Replace neoliberalism with a respect for both tradition
and change.
@delia ruhe & may it be so – I fervently agree with you and the editors.
To save the republic and constitutional government, these wars in
the Middle East and elsewhere must be ended, we must get out of that region,
and the government must be made to perform the basic duty of securing our
own borders and finding and expelling those here illegally.
A government perpetually at war is a danger to the republic. It has
squandered our money and blood in foreign adventures half way around the
world and undermined our liberties and dignity here at home while shirking
its own basic duty.
The source of all of this republic's woes is an absence of competent,
responsible leadership. Neither of the 2 government parties has come close
to providing this at the national level. Everyone knows this, but now
– for the first time in at least 5 decades – people are starting to discuss
it openly. It really is a breath of fresh air.
One difference between Trump an Sanders is that The Democrat Washington
Establishment is beginning to show Sanders and his supporters the door,
where The GOP Washington Establishment is beginning to be shown the door
by Trump and his supporters.
The Cubano Twins, Tweedledum and Tweedledee appear to be a pair of
Neoconservative Big Money Donor Financed Bookends.
"The Democrat Washington Establishment is beginning to show Sanders
and his supporters the door, where The GOP Washington Establishment
is beginning to be shown the door by Trump and his supporters."
That's a problem with which the Democrat base must must come to grips.
Across the great political and cultural gulf that separates us, I salute
those honorable and decent Democrats and liberals who make the attempt.
But it is instructive to consider the very different trajectories of
Occupy Wall Street and the Tea Party. Occupy Wall Street, having ebbed from
front pages and headlines long since, has now virtually disappeared into
Sanders' wickering campaign.
But the Tea Party kept at it. It has been stirring the pot for over six
years now, menacing the establishment, chronically kicking out incumbents
(including disappointing or coopted Tea Party incumbents), and continuing
to drive broad political developments.
Occupy is dead, Sanders is dying, and the Democrats will soon be
a wholly owned subsidiary of Clinton Inc. Rather, it is the widely
ridiculed and derided Tea Party tendency (not to be confused with the various
attempts at cooptation by groups using the name) that proved to be adults
with staying power, real agents of change. The pacts born of deep concern
for the republic made years ago in hearts, homes, conversations among friends
and coworkers, over the Web on sites like this one, is alive and well.
I'm sorry folks. Reaganomics is the era we may see coming to an end
– perhaps. And what did Bush Senior call it?: 'Voodoo Economics.'
The Soviets were not defeated by our military build-up – the fact that
their factories were turning out unusable junk and exploding TVs was what
defeated them. China saw the writing on the wall earlier in 1979.
But Reagan succeeded in creating massive deficits and building up
a military that was then primed for war. He was absolutely counter to Dwight
Eisenhower in almost every respect (who was arguably the last Great Republican
President).
The rise of Wall Street and unregulated finance also took place under
Reagan's watch. Declining investment in infrastructure. The power of lobbyists
became massive in the 80s after being relatively tame prior. This all set
the stage.
We all have confirmation biases (fueled by a personal history) in how
we choose to interpret history and how we bookend things.
The concluding paragraph is excellent. I pray we are not entering even
darker times and that there can be renewal for the American Republic.
"Occupy is dead, Sanders is dying, and the Democrats will soon
be a wholly owned subsidiary of Clinton Inc."
Only because older voters, particularly older black voters keep propping
it up. Not exactly a firm foundation. Sanders margins among young voters
along with the successful political work done by actual political groups
(rather than disruptive groups) like the Working Families Party show who
is going to inherit the Democratic Party.
That economic populism should find a foothold in both parties
after the Great Recession and eight years of lagging prosperity under
Barack Obama is not entirely surprising.
I've long wanted to read the Donald Warren book but it has been out of
print and unavailable at Amazon. If anyone knows of any online bookseller
that has used copies, please tell.
Thanks to @Blas another first on the pages of TAC: the words "Trump"
and "Humane" used in relation to one another.
And thanks to the Tea Party, a Congress that won't pass any sort of populist
reform simply because it might mean shaking hands across the aisle.
@AndyG "And thanks to the Tea Party, a Congress that won't pass any
sort of populist reform simply because it might mean shaking hands across
the aisle."
What a laugh.
"Across the aisle" from the Tea Party congressmen are Democrats who say
"What's mine is mine and what's yours is negotiable. You must not only tolerate
what is repugnant to you, you must accept it or I'll have you arrested.
The Federal judiciary is the engine of democracy. I only enforce laws I
like. Only a fanatic would try to balance or reduce the federal budget.
It's as impossible and absurd as controlling immigration. Wall Street is
just fine as long as it hires lots of Diversity Officers, and the only people
who oppose globalism and the corporations who fill my campaign coffers are
racists and bigots."
As to populist reforms that TP Republicans and Democrat dissidents might
have cooperated on, like reimposition of Glass-Steagel, or laws requiring
vigorous prosecution of Wall Street criminals and Wall Street-owned government
officials, or reining in the NSA, or ending the Middle East wars, the establishments
of both parties have collaborated to crush their efforts. Just ask Rand
Paul (R) and Ron Wyden (D).
Of course the Tea Party base is still fighting back hard. It's engaged
in mortal combat with the GOP establishment. God willing and with perseverence
it may prevail.
And what are those "across the aisle", the congressional Democrats, doing?
Other than politely watching Sanders sputter into oblivion as they prepare
for HRC's coronation? And what is the Democrat base doing other than making
that possible? Most of them aren't even going to the polls …
"Occupy is dead, Sanders is dying, and the Democrats will soon
be a wholly owned subsidiary of Clinton Inc. Rather, it is the widely
ridiculed and derided Tea Party tendency (not to be confused with the
various attempts at cooptation by groups using the name) that proved
to be adults with staying power, real agents of change."
I was heavily involved with the original Zucotti Park Occupy encampment,
doing outreach to unions and the working class. There was quite a bit of
hope for this in the early heady days of Occupy; but in the end, the priorities
of a movement run by and for impoverished and entitled graduate students
won out. Around this time I started to understand that the center of gravity
of real radicalism in this country was on the "right".
"Every Republican except Trump has tried, to one degree or another,
to present himself as a champion of conservative orthodoxy."
If you are having to measure it in degrees of this or ht, then there's
a good chance you don't represent what it is that you partially represent.
In my view conservative is not hodge podge, it's a mechanism or an a priori
vie point by which one approaches most or all of their life.
My guess is that people are not responding o a conservative orthodoxy
because they just don't see one. In my view Sen Cruz and Dr. Caron and even
(CEO) Mrs. Fiorina have the closest ties to a conservative view. Where i
seems to come undone is on the issue of (needlessly) aggressive foreign
policy. Mr. Trump is a conservative now, but his life has not fully reflected
as much.
The traditional conservative
very pro the "common man" Does not oppose wealth, but that is not
a goal in of itself.
does not pretend that that there is not objective realities - there
are facts that matter – Truth is not relative even if opinions, ideas
and tastes are.
prudence to change, why and what it's consequences.
fairness, fair play and undying desire or justice
economic efficiency (not just frugality)
a definitive sense of country and kinsmen – even if he or she thinks
they are less their cup of tea and morality –
a belief in a divine being with whom one is dynamically involved
with – while Christianity is my own preference it need not be the sole
belief that a conservative adhere's to.
I have to comprehend the community benefit for killing children
in the womb, much it's complete undermining of what innocents means.
It makes little practical sense for a community that pushes the choice
of homosexual expression a some kind norm when it adds nothing of community
value beyond individual satisfaction. That a dynamic which is retrograde
to community flourishing should be a national agenda is also incomprehensible
___________________
I am not inclined to give the "Tea Party much credit. They have been
part of the very problem. Though I guess, the shift to another direction
is a positive sign. As I recall the Tea Party was the last to give up the
ghost that the invasion of Iraq was worthwhile and certainly a leap from
conservative thought and practice, in almost every respect.
It dawned them rather belated that the PA and HMS was going to come back
to haunt them. And yet for those who are Christian , what they should have
known is that in the end, it is just such programs that will be used to
round them and send them packing - yet, they have been all for extreme forms
of government when it suited them. Now that democrats are using those against
their interests, they are suddenly awake - suddenly they are about the Constitution.
Yet they have been all to happy to abandon the same when it comes those
who come into contact with police. When Republicans should have embraced
civil protections, they shunned it as though such concerns were unconstitutional
the powers that began turned their sights on them. Hard to claim some populist
mandate unless the so called populism benefits your interests alone. I am
dubious that this is some kind middle and lower class uprising in the Republican
party - the support for Mr. Trump appears to be much broader.
_________________
Sadly, I think it is accurate that blacks have come to the rescue
of Sec. Clinton. It is sad, but it is understandable. I was walking
on campus yesterday. And having lived in these community for some time,
it struck me as deeply depressing that there were large groups of Asians
and Hispanics groups and it was starkly distressing to realize that that
for all of this country's embrace of diversity, blacks remain non existent
on campus. Considering that education is the now the bastion of democratic
and liberal life, blacks seem very ill served by the people they support.
I doubt the Rose Law firm is going to abandon overseeing contracts to support
cheap labor which will most impact negatively the lives of no few blacks.
But if you don't have th gumption to fight, the democratic broad rode is
a sensible choice. Fear of losing what you don't have is a liberal/democratic
tote bag.
I remain hopeful that one day, blacks will wake up and reject the liberal
bait and switch spoon fed them.
_________________________
Unfortunately,
Pres. Reagan has been saddled with the term "Reaganonmics". When
in fact, it never existed as designed and as result was never fully implemented.
Reality got in the way and as such subverted a good deal of the intent.
It is incorrect to posit the model as top down. The model is as old as the
country – keep money in people's hands and it will flow and redistribute
throughout the country. There's just no incentives created for those with
the most to reinvest in their community the US.
_____________
I think the observations concerning how the financial industry have
been totally unaccountable to the law, best practices and basic math are
spot on. I embrace WS, but they cannot become so unmoored from the country
that has bestowed luxurious benefits (loopholes) as to operate outside that
frame without consequence. I am unsure of the monetary efficacy that investing
in investing. If one is going bandy about "law and order" then to have any
genuine legs – it's an across the board application.
"... Not only are "[v]ulnerable Senate Republicans are starting to side with Donald Trump (and Democrats) by opposing President Obama's signature trade deal," as the Washington Post ..."
As the White House prepares for its final "
all-out push " to pass the Trans Pacific Partnership (TPP) during the upcoming
lame-duck session of Congress, lawmakers on both sides of the political aisle
are being made vulnerable due to growing opposition to the controversial, corporate-friendly
trade deal.
"[I]n 2016," the Guardian
reported on Saturday, "America's faltering faith in free trade has become
the most sensitive controversy in D.C."
Yet President Barack Obama "has refused to give up," wrote Guardian
journalists Dan Roberts and Ryan Felton, despite the fact that the 12-nation
TPP "suddenly faces a wall of political opposition among lawmakers who had,
not long ago, nearly set the giant deal in stone."
... ... ...
Not only are "[v]ulnerable Senate Republicans are starting to side with
Donald Trump (and Democrats) by opposing President Obama's signature trade deal,"
as the Washington Post
reported Thursday, but once-supportive Dems are also poised to jump ship.
To that end, in a column this week, Campaign for America's Future blogger
Dave Johnson
listed for readers "28 House Democrat targets...who-in spite of opposition
from most Democrats and hundreds of labor, consumer, LGBT, health, human rights,
faith, democracy and other civil organizations-voted for the 'fast-track' trade
promotion authority (TPA) bill that 'greased the skids' for the TPP by setting
up rigged rules that will help TPP pass."
Of the list that includes Reps. Debbie Wasserman Schultz (Fla.), Jared Polis
(Colo.), and Ron Kind (Wis.), Johnson wrote: "Let's get them on the record before
the election about whether they will vote for TPP after the election."
Imagine if the people of the Soviet Union had never heard of communism. The
ideology that dominates our lives has, for most of us, no name. Mention it in
conversation and you'll be rewarded with a shrug. Even if your listeners have
heard the term before, they will struggle to define it. Neoliberalism: do you
know what it is?
Its anonymity is both a symptom and cause of its power. It has played a major
role in a remarkable variety of crises: the
financial meltdown of 2007‑8, the offshoring of wealth and power, of which
the
Panama Papers offer us merely a glimpse, the slow collapse of public health
and education, resurgent child poverty,
the epidemic of loneliness, the collapse of ecosystems, the rise of
Donald
Trump. But we respond to these crises as if they emerge in isolation, apparently
unaware that they have all been either catalysed or exacerbated by the same
coherent philosophy; a philosophy that has – or had – a name. What greater power
can there be than to operate namelessly?
Inequality is recast as virtuous. The market ensures that everyone gets
what they deserve.
So pervasive has neoliberalism become that we seldom even recognise it as
an ideology. We appear to accept the proposition that this utopian, millenarian
faith describes a neutral force; a kind of biological law, like Darwin's theory
of evolution. But the philosophy arose as a conscious attempt to reshape human
life and shift the locus of power.
Neoliberalism sees competition as the defining characteristic of human relations.
It redefines citizens as consumers, whose democratic choices are best exercised
by buying and selling, a process that rewards merit and punishes inefficiency.
It maintains that "the market" delivers benefits that could never be achieved
by planning.
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Attempts to limit competition are treated as inimical to liberty. Tax and
regulation should be minimised, public services should be privatised. The organisation
of labour and collective bargaining by
trade
unions are portrayed as market distortions that impede the formation of
a natural hierarchy of winners and losers. Inequality is recast as virtuous:
a reward for utility and a generator of wealth, which trickles down to enrich
everyone. Efforts to create a more equal society are both counterproductive
and morally corrosive. The market ensures that everyone gets what they deserve.
We internalise and reproduce its creeds.
The rich persuade themselves that they acquired their wealth through merit,
ignoring the advantages – such as education, inheritance and class – that may
have helped to secure it. The poor begin to blame themselves for their failures,
even when they can do little to change their circumstances.
Never mind structural unemployment: if you don't have a job it's because
you are unenterprising. Never mind the impossible costs of housing: if your
credit card is maxed out, you're feckless and improvident. Never mind that your
children no longer have a school playing field: if they get fat, it's your fault.
In a world governed by competition, those who fall behind become defined and
self-defined as losers.
Paul Verhaeghe: An economic system that rewards psychopathic
personality traits has changed our ethics and our personalities
Read more
Among the results, as Paul Verhaeghe documents in his book What About
Me? are epidemics of self-harm, eating disorders, depression, loneliness,
performance anxiety and social phobia. Perhaps it's unsurprising that Britain,
in which neoliberal ideology has been most rigorously applied, is
the loneliness capital of Europe. We are all neoliberals now.
***
The term neoliberalism was coined at a meeting in Paris in 1938. Among the
delegates were two men who came to define the ideology, Ludwig von Mises and
Friedrich Hayek. Both exiles from Austria, they saw social democracy, exemplified
by Franklin Roosevelt's New Deal and the gradual development of Britain's welfare
state, as manifestations of a collectivism that occupied the same spectrum as
nazism and communism.
In The Road to Serfdom, published in 1944, Hayek argued that government
planning, by crushing individualism, would lead inexorably to totalitarian control.
Like Mises's book Bureaucracy, The Road to Serfdom was widely
read. It came to the attention of some very wealthy people, who saw in the philosophy
an opportunity to free themselves from regulation and tax. When, in 1947, Hayek
founded the first organisation that would spread the doctrine of neoliberalism
– the Mont Pelerin Society
– it was supported financially by millionaires and their foundations.
As it evolved, neoliberalism became more strident. Hayek's view that governments
should regulate competition to prevent monopolies from forming gave way – among
American apostles such as
Milton Friedman – to the belief that monopoly power could be seen as a reward
for efficiency.
Something else happened during this transition: the movement lost its name.
In 1951, Friedman was happy to
describe himself as a neoliberal. But soon after that, the term began to
disappear. Stranger still, even as the ideology became crisper and the movement
more coherent, the lost name was not replaced by any common alternative.
At first, despite its lavish funding, neoliberalism remained at the margins.
The postwar consensus was almost universal:
John Maynard Keynes's economic prescriptions were widely applied, full employment
and the relief of poverty were common goals in the US and much of western Europe,
top rates of tax were high and governments sought social outcomes without embarrassment,
developing new public services and safety nets.
But in the 1970s, when Keynesian policies began to fall apart and economic
crises struck on both sides of the Atlantic, neoliberal ideas began to enter
the mainstream. As Friedman remarked, "when the time came that you had to change
... there was an alternative ready there to be picked up". With the help of
sympathetic journalists and political advisers, elements of neoliberalism, especially
its prescriptions for monetary policy, were adopted by Jimmy Carter's administration
in the US and Jim Callaghan's government in Britain.
It may seem strange that a doctrine promising choice should have been
promoted with the slogan 'there is no alternative'
After Margaret Thatcher and Ronald Reagan took power, the rest of the package
soon followed: massive tax cuts for the rich, the crushing of trade unions,
deregulation, privatisation, outsourcing and competition in public services.
Through the IMF, the World Bank, the Maastricht treaty and the World Trade Organisation,
neoliberal policies were imposed – often without democratic consent – on much
of the world. Most remarkable was its adoption among parties that once belonged
to the left: Labour and the Democrats, for example. As Stedman Jones notes,
"it is hard to think of another utopia to have been as fully realised."
***
It may seem strange that a doctrine promising choice and freedom should have
been promoted with the slogan "there is no alternative". But,
as Hayek remarked on a visit to Pinochet's Chile – one of the first nations
in which the programme was comprehensively applied – "my personal preference
leans toward a liberal dictatorship rather than toward a democratic government
devoid of liberalism". The freedom that neoliberalism offers, which sounds so
beguiling when expressed in general terms, turns out to mean freedom for the
pike, not for the minnows.
Freedom from trade unions and collective bargaining means the freedom to
suppress wages. Freedom from regulation means the
freedom to poison rivers, endanger workers, charge iniquitous rates of interest
and design exotic financial instruments. Freedom from tax means freedom from
the distribution of wealth that lifts people out of poverty.
Naomi Klein documented that neoliberals
advocated the use of crises to impose unpopular policies while people were
distracted. Photograph: Anya Chibis for the Guardian
As Naomi Klein documents in
The Shock Doctrine, neoliberal theorists advocated the use of crises
to impose unpopular policies while people were distracted: for example, in the
aftermath of Pinochet's coup, the Iraq war and Hurricane Katrina, which Friedman
described as "an opportunity to radically reform the educational system" in
New Orleans.
Where neoliberal policies cannot be imposed domestically, they are imposed
internationally, through trade treaties incorporating "investor-state
dispute settlement": offshore tribunals in which corporations can press
for the removal of social and environmental protections. When parliaments have
voted to restrict sales of
cigarettes, protect water supplies from mining companies, freeze energy
bills or prevent pharmaceutical firms from ripping off the state, corporations
have sued, often successfully. Democracy is reduced to theatre.
Neoliberalism was not conceived as a self-serving racket, but it rapidly
became one
Another paradox of neoliberalism is that universal competition relies upon
universal quantification and comparison. The result is that workers, job-seekers
and public services of every kind are subject to a pettifogging, stifling regime
of assessment and monitoring, designed to identify the winners and punish the
losers. The doctrine that Von Mises proposed would free us from the bureaucratic
nightmare of central planning has instead created one.
Neoliberalism was not conceived as a self-serving racket, but it rapidly
became one. Economic growth has been markedly slower in the neoliberal era (since
1980 in Britain and the US) than it was in the preceding decades; but not for
the very rich. Inequality in the distribution of both income and wealth, after
60 years of decline, rose rapidly in this era, due to the smashing of trade
unions, tax reductions, rising rents, privatisation and deregulation.
The privatisation or marketisation of public services such as energy, water,
trains, health, education, roads and prisons has enabled corporations to set
up tollbooths in front of essential assets and charge rent, either to citizens
or to government, for their use. Rent is another term for unearned income. When
you pay an inflated price for a train ticket, only part of the fare compensates
the operators for the money they spend on fuel, wages, rolling stock and other
outlays. The rest reflects the fact that
they have you over a barrel.
Those who own and run the UK's privatised or semi-privatised services make
stupendous fortunes by investing little and charging much. In Russia and India,
oligarchs acquired state assets through firesales. In Mexico,
Carlos Slim was granted control of almost all landline and mobile phone
services and soon became the world's richest man.
Financialisation, as Andrew Sayer notes in
Why We Can't Afford the Rich, has had a similar impact. "Like rent,"
he argues, "interest is ... unearned income that accrues without any effort".
As the poor become poorer and the rich become richer, the rich acquire increasing
control over another crucial asset: money. Interest payments, overwhelmingly,
are a transfer of money from the poor to the rich. As property prices and the
withdrawal of state funding load people with debt (think of the switch from
student grants to student loans), the banks and their executives clean up.
Sayer argues that the past four decades have been characterised by a transfer
of wealth not only from the poor to the rich, but within the ranks of the wealthy:
from those who make their money by producing new goods or services to those
who make their money by controlling existing assets and harvesting rent, interest
or capital gains. Earned income has been supplanted by unearned income.
Neoliberal policies are everywhere beset by market failures. Not only are
the banks too big to fail, but so are the corporations now charged with delivering
public services. As Tony Judt pointed out in
Ill Fares the Land, Hayek forgot that vital national services cannot
be allowed to collapse, which means that competition cannot run its course.
Business takes the profits, the state keeps the risk.
The greater the failure, the more extreme the ideology becomes. Governments
use neoliberal crises as both excuse and opportunity to cut taxes, privatise
remaining public services, rip holes in the social safety net, deregulate corporations
and re-regulate citizens. The self-hating state now sinks its teeth into every
organ of the public sector.
Perhaps the most dangerous impact of neoliberalism is not the economic crises
it has caused, but the political crisis. As the domain of the state is reduced,
our ability to change the course of our lives through voting also contracts.
Instead, neoliberal theory asserts, people can exercise choice through spending.
But some have more to spend than others: in the great consumer or shareholder
democracy, votes are not equally distributed. The result is a disempowerment
of the poor and middle. As parties of the right and
former left adopt similar neoliberal policies, disempowerment turns to disenfranchisement.
Large numbers of people have been shed from politics.
Chris Hedges
remarks that "fascist movements build their base not from the politically
active but the politically inactive, the 'losers' who feel, often correctly,
they have no voice or role to play in the political establishment". When political
debate no longer speaks to us, people become responsive
instead to slogans, symbols and sensation. To the admirers of Trump, for
example, facts and arguments appear irrelevant.
Judt explained that when the thick mesh of interactions between people and
the state has been reduced to nothing but authority and obedience, the only
remaining force that binds us is state power. The totalitarianism Hayek feared
is more likely to emerge when governments, having lost the moral authority that
arises from the delivery of public services, are reduced to "cajoling, threatening
and ultimately coercing people to obey them".
***
Like communism, neoliberalism is the God that failed. But the zombie doctrine
staggers on, and one of the reasons is its anonymity. Or rather, a cluster of
anonymities.
The invisible doctrine of the invisible hand is promoted by invisible backers.
Slowly, very slowly, we have begun to discover the names of a few of them. We
find that the Institute of Economic Affairs, which has argued forcefully in
the media against the further regulation of the tobacco industry,
has been secretly funded by British American Tobacco since 1963. We discover
that
Charles and David Koch, two of the richest men in the world, founded the
institute that set up the
Tea Party movement. We find that Charles Koch, in establishing one of his
thinktanks,
noted that "in order to avoid undesirable criticism, how the organisation
is controlled and directed should not be widely advertised".
The nouveau riche were once disparaged by those who had inherited their
money. Today, the relationship has been reversed
The words used by neoliberalism often conceal more than they elucidate. "The
market" sounds like a natural system that might bear upon us equally, like gravity
or atmospheric pressure. But it is fraught with power relations. What "the market
wants" tends to mean what corporations and their bosses want. "Investment",
as Sayer notes, means two quite different things. One is the funding of productive
and socially useful activities, the other is the purchase of existing assets
to milk them for rent, interest, dividends and capital gains. Using the same
word for different activities "camouflages the sources of wealth", leading us
to confuse wealth extraction with wealth creation.
A century ago, the nouveau riche were disparaged by those who had inherited
their money. Entrepreneurs sought social acceptance by passing themselves off
as rentiers. Today, the relationship has been reversed: the rentiers and inheritors
style themselves entre preneurs. They claim to have earned their unearned income.
These anonymities and confusions mesh with the namelessness and placelessness
of modern capitalism: the franchise model which ensures that workers
do not know for whom they toil; the companies registered through a network
of offshore secrecy regimes so complex that
even the
police cannot discover the beneficial owners; the tax arrangements that
bamboozle governments; the financial products no one understands.
The anonymity of neoliberalism is fiercely guarded. Those who are influenced
by Hayek, Mises and Friedman tend to reject the term, maintaining – with some
justice – that it is used today
only pejoratively. But they offer us no substitute. Some describe themselves
as classical liberals or libertarians, but these descriptions are both misleading
and curiously self-effacing, as they suggest that there is nothing novel about
The Road to Serfdom, Bureaucracy or Friedman's classic work,
Capitalism and Freedom.
***
For all that, there is something admirable about the neoliberal project,
at least in its early stages. It was a distinctive, innovative philosophy promoted
by a coherent network of thinkers and activists with a clear plan of action.
It was patient and persistent. The Road to Serfdom became the path to
power.
Letters: For neoliberals to claim that their view supports
the current distribution of property and power is almost as bonkers as the Lockean
theory of property itself
Read more
Neoliberalism's triumph also reflects the failure of the left. When laissez-faire
economics led to catastrophe in 1929, Keynes devised a comprehensive economic
theory to replace it. When Keynesian demand management hit the buffers in the
70s, there was an alternative ready. But when neoliberalism fell apart in 2008
there was ... nothing. This is why the zombie walks. The left and centre have
produced no new general framework of economic thought for 80 years.
Every invocation of Lord Keynes is an admission of failure. To propose Keynesian
solutions to the crises of the 21st century is to ignore three obvious problems.
It is hard to mobilise people around old ideas; the flaws exposed in the 70s
have not gone away; and, most importantly, they have nothing to say about our
gravest predicament: the environmental crisis. Keynesianism works by stimulating
consumer demand to promote economic growth. Consumer demand and economic growth
are the motors of environmental destruction.
What the history of both Keynesianism and neoliberalism show is that it's
not enough to oppose a broken system. A coherent alternative has to be proposed.
For Labour, the Democrats and the wider left, the central task should be to
develop an economic Apollo programme, a conscious attempt to design a new system,
tailored to the demands of the 21st century.
George Monbiot's How Did We Get into This Mess? is published this month
by Verso. To order a copy for £12.99 (RRP £16.99) ) go to
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"... At the same time that people like you and me are thriving beyond the dreams of any plutocrats in history, the rest of the country-the 99.99 percent-is lagging far behind. The divide between the haves and have-nots is getting worse really, really fast. In 1980, the top 1 percent controlled about 8 percent of U.S. national income. The bottom 50 percent shared about 18 percent. Today the top 1 percent share about 20 percent; the bottom 50 percent, just 12 percent. ..."
"... The model for us rich guys here should be Henry Ford, who realized that all his autoworkers in Michigan weren't only cheap labor to be exploited; they were consumers, too. Ford figured that if he raised their wages, to a then-exorbitant $5 a day, they'd be able to afford his Model Ts. ..."
Memo: From Nick Hanauer To: My Fellow Zillionaires
You probably don't know me, but like you I am one of those .01%ers, a proud
and unapologetic capitalist. I have founded, co-founded and funded more than
30 companies across a range of industries-from itsy-bitsy ones like the night
club I started in my 20s to giant ones like Amazon.com, for which I was the
first nonfamily investor. Then I founded aQuantive, an Internet advertising
company that was
sold to Microsoft in 2007 for $6.4 billion. In cash. My friends and I own
a bank. I tell you all this to demonstrate that in many ways I'm no different
from you. Like you, I have a broad perspective on business and capitalism. And
also like you, I have been rewarded obscenely for my success, with a life that
the other 99.99 percent of Americans can't even imagine. Multiple homes, my
own plane, etc., etc. You know what I'm talking about. In 1992, I was selling
pillows made by my family's business, Pacific Coast Feather Co., to retail stores
across the country, and the Internet was a clunky novelty to which one hooked
up with a loud squawk at 300 baud. But I saw pretty quickly, even back then,
that many of my customers, the big department store chains, were already doomed.
I knew that as soon as the Internet became fast and trustworthy enough-and that
time wasn't far off-people were going to shop online like crazy. Goodbye, Caldor.
And Filene's. And Borders. And on and on.
Realizing that, seeing over the horizon a little faster than the next guy,
was the strategic part of my success. The lucky part was that I had two friends,
both immensely talented, who also saw a lot of potential in the web. One was
a guy you've probably never heard of named Jeff Tauber, and the other was a
fellow named Jeff Bezos. I was so excited by the potential of the web that I
told both Jeffs that I wanted to invest in whatever they launched, big time.
It just happened that the second Jeff-Bezos-called me back first to take up
my investment offer. So I helped underwrite his tiny start-up bookseller. The
other Jeff started a web department store called Cybershop, but at a time when
trust in Internet sales was still low, it was too early for his high-end online
idea; people just weren't yet ready to buy expensive goods without personally
checking them out (unlike a basic commodity like books, which don't vary in
quality-Bezos' great insight). Cybershop didn't make it, just another dot-com
bust. Amazon did somewhat better. Now I own a very large yacht.
But let's speak frankly to each other. I'm not the smartest guy you've ever
met, or the hardest-working. I was a mediocre student. I'm not technical at
all-I can't write a word of code. What sets me apart, I think, is a tolerance
for risk and an intuition about what will happen in the future. Seeing where
things are headed is the essence of entrepreneurship. And what do I see in our
future now?
I see pitchforks.
At the same time that people like you and me are thriving beyond the
dreams of any plutocrats in history, the rest of the country-the 99.99 percent-is
lagging far behind. The divide between the haves and have-nots is getting worse
really, really fast. In 1980, the top 1 percent
controlled about 8 percent of U.S. national income. The bottom 50 percent
shared about 18 percent. Today the top 1 percent share about 20 percent;
the bottom 50 percent,
just 12 percent.
But the problem isn't that we have inequality. Some inequality is intrinsic
to any high-functioning capitalist economy. The problem is that inequality is
at historically high levels and getting worse every day. Our country is rapidly
becoming less a capitalist society and more a feudal society. Unless our policies
change dramatically, the middle class will disappear, and we will be back to
late 18th-century France. Before the revolution.
Memo: From Nick Hanauer To: My Fellow Zillionaires
You probably don't know me, but like you I am one of those .01%ers, a proud
and unapologetic capitalist. I have founded, co-founded and funded more than
30 companies across a range of industries-from itsy-bitsy ones like the night
club I started in my 20s to giant ones like Amazon.com, for which I was the
first nonfamily investor. Then I founded aQuantive, an Internet advertising
company that was
sold to Microsoft in 2007 for $6.4 billion. In cash. My friends and I own
a bank. I tell you all this to demonstrate that in many ways I'm no different
from you. Like you, I have a broad perspective on business and capitalism. And
also like you, I have been rewarded obscenely for my success, with a life that
the other 99.99 percent of Americans can't even imagine. Multiple homes, my
own plane, etc., etc. You know what I'm talking about. In 1992, I was selling
pillows made by my family's business, Pacific Coast Feather Co., to retail stores
across the country, and the Internet was a clunky novelty to which one hooked
up with a loud squawk at 300 baud. But I saw pretty quickly, even back then,
that many of my customers, the big department store chains, were already doomed.
I knew that as soon as the Internet became fast and trustworthy enough-and that
time wasn't far off-people were going to shop online like crazy. Goodbye, Caldor.
And Filene's. And Borders. And on and on.
Realizing that, seeing over the horizon a little faster than the next guy,
was the strategic part of my success. The lucky part was that I had two friends,
both immensely talented, who also saw a lot of potential in the web. One was
a guy you've probably never heard of named Jeff Tauber, and the other was a
fellow named Jeff Bezos. I was so excited by the potential of the web that I
told both Jeffs that I wanted to invest in whatever they launched, big time.
It just happened that the second Jeff-Bezos-called me back first to take up
my investment offer. So I helped underwrite his tiny start-up bookseller. The
other Jeff started a web department store called Cybershop, but at a time when
trust in Internet sales was still low, it was too early for his high-end online
idea; people just weren't yet ready to buy expensive goods without personally
checking them out (unlike a basic commodity like books, which don't vary in
quality-Bezos' great insight). Cybershop didn't make it, just another dot-com
bust. Amazon did somewhat better. Now I own a very large yacht.
But let's speak frankly to each other. I'm not the smartest guy you've ever
met, or the hardest-working. I was a mediocre student. I'm not technical at
all-I can't write a word of code. What sets me apart, I think, is a tolerance
for risk and an intuition about what will happen in the future. Seeing where
things are headed is the essence of entrepreneurship. And what do I see in our
future now?
I see pitchforks.
At the same time that people like you and me are thriving beyond the dreams
of any plutocrats in history, the rest of the country-the 99.99 percent-is lagging
far behind. The divide between the haves and have-nots is getting worse really,
really fast. In 1980, the top 1 percent
controlled about 8 percent of U.S. national income. The bottom 50 percent
shared about 18 percent. Today the top 1 percent share about 20 percent;
the bottom 50 percent,
just 12 percent.
But the problem isn't that we have inequality. Some inequality is intrinsic
to any high-functioning capitalist economy. The problem is that inequality is
at historically high levels and getting worse every day. Our country is rapidly
becoming less a capitalist society and more a feudal society. Unless our policies
change dramatically, the middle class will disappear, and we will be back to
late 18th-century France. Before the revolution.
And so I have a message for my fellow filthy rich, for all of us who live
in our gated bubble worlds: Wake up, people. It won't last.
If we don't do something to fix the glaring inequities in this economy, the
pitchforks are going to come for us. No society can sustain this kind of rising
inequality. In fact, there is no example in human history where wealth accumulated
like this and the pitchforks didn't eventually come out. You show me a highly
unequal society, and I will show you a police state. Or an uprising. There are
no counterexamples. None. It's not if, it's when.
Many of us think we're special because "this is America." We think we're
immune to the same forces that started the Arab Spring-or the French and Russian
revolutions, for that matter. I know you fellow .01%ers tend to dismiss this
kind of argument; I've had many of you tell me to my face I'm completely bonkers.
And yes, I know there are many of you who are convinced that because you saw
a poor kid with an iPhone that one time, inequality is a fiction.
Here's what I say to you: You're living in a dream world. What everyone wants
to believe is that when things reach a tipping point and go from being merely
crappy for the masses to dangerous and socially destabilizing, that we're somehow
going to know about that shift ahead of time. Any student of history knows that's
not the way it happens. Revolutions, like bankruptcies, come gradually, and
then suddenly. One day, somebody sets himself on fire, then thousands of people
are in the streets, and before you know it, the country is burning. And then
there's no time for us to get to the airport and jump on our Gulfstream Vs and
fly to New Zealand. That's the way it always happens. If inequality keeps rising
as it has been, eventually it will happen. We will not be able to predict when,
and it will be terrible-for everybody. But especially for us.
***
The most ironic thing about rising inequality is how completely unnecessary
and self-defeating it is. If we do something about it, if we adjust our policies
in the way that, say, Franklin D. Roosevelt did during the Great Depression-so
that we help the 99 percent and preempt the revolutionaries and crazies, the
ones with the pitchforks-that will be the best thing possible for us rich folks,
too. It's not just that we'll escape with our lives; it's that we'll most certainly
get even richer.
The model for us rich guys here should be Henry Ford, who realized that
all his autoworkers in Michigan weren't only cheap labor to be exploited; they
were consumers, too. Ford figured that if he
raised their wages, to a then-exorbitant $5 a day, they'd be able to afford
his Model Ts.
What a great idea. My suggestion to you is: Let's do it all over again. We've
got to try something. These idiotic trickle-down policies are destroying my
customer base. And yours too.
It's when I realized this that I decided I had to leave my insulated world
of the super-rich and get involved in politics. Not directly, by running for
office or becoming one of the big-money billionaires who back candidates in
an election. Instead, I wanted to try to change the conversation with ideas-by
advancing what my co-author, Eric Liu, and I call "middle-out" economics. It's
the long-overdue rebuttal to the trickle-down economics worldview that has become
economic orthodoxy across party lines-and has so screwed the American middle
class and our economy generally. Middle-out economics rejects the old misconception
that an economy is a perfectly efficient, mechanistic system and embraces the
much more accurate idea of an economy as a complex ecosystem made up of real
people who are dependent on one another.
Which is why the fundamental law of capitalism must be: If workers have more
money, businesses have more customers. Which makes middle-class consumers, not
rich businesspeople like us, the true job creators. Which means a thriving middle
class is the source of American prosperity, not a consequence of it. The middle
class creates us rich people, not the other way around.
On June 19, 2013, Bloomberg published an
article I wrote called "The Capitalist's Case for a $15 Minimum Wage."
Forbes
labeled it "Nick Hanauer's near insane" proposal. And yet, just weeks after
it was published, my friend David Rolf, a Service Employees International Union
organizer, roused fast-food workers to go on strike around the country for a
$15 living wage. Nearly a year later, the city of Seattle
passed a $15 minimum wage. And just 350 days after my article was published,
Seattle Mayor Ed Murray signed that ordinance into law. How could this happen,
you ask?
It happened because we reminded the masses that they are the source of growth
and prosperity, not us rich guys. We reminded them that when workers have more
money, businesses have more customers-and need more employees. We reminded them
that if businesses paid workers a living wage rather than poverty wages, taxpayers
wouldn't have to make up the difference. And when we got done, 74 percent of
likely Seattle voters in a
recent poll agreed that a $15 minimum wage was a swell idea.
The standard response in the minimum-wage debate, made by Republicans and
their business backers and plenty of Democrats as well, is that raising the
minimum wage costs jobs. Businesses will have to lay off workers. This argument
reflects the orthodox economics that most people had in college. If you took
Econ 101, then you literally were taught that if wages go up, employment must
go down. The law of supply and demand and all that. That's why you've got John
Boehner and other Republicans in Congress insisting that if you price employment
higher, you get less of it. Really?
The thing about us businesspeople is that we love our customers rich
and our employees poor.
Because here's an odd thing. During the past three decades, compensation
for CEOs grew 127 times faster than it did for workers. Since 1950, the CEO-to-worker
pay ratio has increased 1,000 percent, and that is not a typo. CEOs
used to earn 30 times the median wage; now they rake in 500 times. Yet no
company I know of has eliminated its senior managers, or outsourced them to
China or automated their jobs. Instead, we now have more CEOs and senior executives
than ever before. So, too, for financial services workers and technology workers.
These folks earn multiples of the median wage, yet we somehow have more and
more of them.
The thing about us businesspeople is that we love our customers rich and
our employees poor. So for as long as there has been capitalism, capitalists
have said the same thing about any effort to raise wages. We've had 75 years
of complaints from big business-when the minimum wage was instituted, when women
had to be paid equitable amounts, when child labor laws were created. Every
time the capitalists said exactly the same thing in the same way: We're all
going to go bankrupt. I'll have to close. I'll have to lay everyone off. It
hasn't happened. In fact, the data show that when workers are better treated,
business gets better. The naysayers are just wrong.
Most of you probably think that the $15 minimum wage in Seattle is an insane
departure from rational policy that puts our economy at great risk. But in Seattle,
our current minimum wage of $9.32 is already nearly 30 percent higher than the
federal minimum wage. And has it ruined our economy yet? Well, trickle-downers,
look at the data here: The two cities in the nation with the highest rate of
job growth by small businesses
are
San Francisco and Seattle. Guess which cities have the highest minimum wage?
San Francisco and Seattle. The
fastest-growing big city in America? Seattle. Fifteen dollars isn't a risky
untried policy for us. It's doubling down on the strategy that's already allowing
our city to kick your city's ass.
It makes perfect sense if you think about it: If a worker earns $7.25 an
hour, which is
now
the national minimum wage, what proportion of that person's income do you
think ends up in the cash registers of local small businesses? Hardly any. That
person is paying rent, ideally going out to get subsistence groceries at Safeway,
and, if really lucky, has a bus pass. But she's not going out to eat at restaurants.
Not browsing for new clothes. Not buying flowers on Mother's Day.
Is this issue more complicated than I'm making out? Of course. Are there
many factors at play determining the dynamics of employment? Yup. But please,
please stop insisting that if we pay low-wage workers more, unemployment will
skyrocket and it will destroy the economy. It's utter nonsense. The most insidious
thing about trickle-down economics isn't believing that if the rich get richer,
it's good for the economy. It's believing that if the poor get richer, it's
bad for the economy.
I know that virtually all of you feel that compelling our businesses to pay
workers more is somehow unfair, or is too much government interference. Most
of you think that we should just let good examples like Costco or Gap lead the
way. Or let the market set the price. But here's the thing. When those who set
bad examples, like the owners of Wal-Mart or McDonald's, pay their workers close
to the minimum wage, what they're really saying is that they'd pay even less
if it weren't illegal. (Thankfully both companies have recently said they would
not oppose a hike in the minimum wage.) In any large group, some people absolutely
will not do the right thing. That's why our economy can only be safe and effective
if it is governed by the same kinds of rules as, say, the transportation system,
with its speed limits and stop signs.
Wal-Mart is our nation's largest employer with some 1.4 million employees
in the United States and more than
$25 billion in pre-tax profit. So why are Wal-Mart employees the largest
group of Medicaid recipients in many states? Wal-Mart could, say, pay each of
its 1 million lowest-paid workers an extra $10,000 per year, raise them all
out of poverty and enable them to, of all things, afford to shop at Wal-Mart.
Not only would this also save us all the expense of the food stamps, Medicaid
and rent assistance that they currently require, but Wal-Mart would still earn
more than $15 billion pre-tax per year. Wal-Mart won't (and shouldn't) volunteer
to pay its workers more than their competitors. In order for us to have an economy
that works for everyone, we should compel all retailers to pay living wages-not
just ask politely.
We rich people have been falsely persuaded by our schooling and the affirmation
of society, and have convinced ourselves, that we are the main job creators.
It's simply not true. There can never be enough super-rich Americans to power
a great economy. I earn about 1,000 times the median American annually, but
I don't buy thousands of times more stuff. My family purchased three cars over
the past few years, not 3,000. I buy a few pairs of pants and a few shirts a
year, just like most American men. I bought two pairs of the fancy wool pants
I am wearing as I write, what my partner Mike calls my "manager pants." I guess
I could have bought 1,000 pairs. But why would I? Instead, I sock my extra money
away in savings, where it doesn't do the country much good.
So forget all that rhetoric about how America is great because of people
like you and me and Steve Jobs. You know the truth even if you won't admit it:
If any of us had been born in Somalia or the Congo, all we'd be is some guy
standing barefoot next to a dirt road selling fruit. It's not that Somalia and
Congo don't have good entrepreneurs. It's just that the best ones are selling
their wares off crates by the side of the road because that's all their customers
can afford.
So why not talk about a different kind of New Deal for the American people,
one that could appeal to the right as well as left-to libertarians as well as
liberals? First, I'd ask my Republican friends to get real about reducing the
size of government. Yes, yes and yes, you guys are all correct: The federal
government is too big in some ways. But no way can you cut government substantially,
not the way things are now. Ronald Reagan and George W. Bush each had eight
years to do it, and they failed miserably.
Republicans and Democrats in Congress can't shrink government with wishful
thinking. The only way to slash government for real is to go back to basic economic
principles: You have to reduce the demand for government. If people are getting
$15 an hour or more, they don't need food stamps. They don't need rent assistance.
They don't need you and me to pay for their medical care. If the consumer middle
class is back, buying and shopping, then it stands to reason you won't need
as large a welfare state. And at the same time, revenues from payroll and sales
taxes would rise, reducing the deficit.
This is, in other words, an economic approach that can unite left and right.
Perhaps that's one reason the right is beginning, inexorably, to wake up to
this reality as well. Even Republicans as diverse as Mitt Romney and Rick Santorum
recently came out in favor of raising the minimum wage, in defiance of the Republicans
in Congress.
***
One thing we can agree on-I'm sure of this-is that the change isn't
going to start in Washington. Thinking is stale, arguments even more so. On
both sides.
But the way I see it, that's all right. Most major social movements have
seen their earliest victories at the state and municipal levels. The fight over
the eight-hour workday, which ended in Washington, D.C., in 1938, began in places
like Illinois and Massachusetts in the late 1800s. The movement for social security
began in California in the 1930s. Even the Affordable Health Care Act-Obamacare-would
have been hard to imagine without Mitt Romney's model in Massachusetts to lead
the way.
Sadly, no Republicans and few Democrats get this. President Obama doesn't
seem to either, though his heart is in the right place. In his State of the
Union speech this year, he mentioned the need for a higher minimum wage but
failed to make the case that less inequality and a renewed middle class would
promote faster economic growth. Instead, the arguments we hear from most Democrats
are the same old social-justice claims. The only reason to help workers is because
we feel sorry for them. These fairness arguments feed right into every stereotype
of Obama and the Democrats as bleeding hearts. Republicans say growth. Democrats
say fairness-and lose every time.
But just because the two parties in Washington haven't figured it out yet
doesn't mean we rich folks can just keep going. The conversation is already
changing, even if the billionaires aren't onto it. I know what you think: You
think that Occupy Wall Street and all the other capitalism-is-the-problem protesters
disappeared without a trace. But that's not true. Of course, it's hard to get
people to sleep in a park in the cause of social justice. But the protests we
had in the wake of the 2008 financial crisis really did help to change the debate
in this country from death panels and debt ceilings to inequality.
It's just that so many of you plutocrats didn't get the message.
Dear 1%ers, many of our fellow citizens are starting to believe that capitalism
itself is the problem. I disagree, and I'm sure you do too. Capitalism, when
well managed, is the greatest social technology ever invented to create prosperity
in human societies. But capitalism left unchecked tends toward concentration
and collapse. It can be managed either to benefit the few in the near term or
the many in the long term. The work of democracies is to bend it to the latter.
That is why investments in the middle class work. And tax breaks for rich people
like us don't. Balancing the power of workers and billionaires by raising the
minimum wage isn't bad for capitalism. It's an indispensable tool smart capitalists
use to make capitalism stable and sustainable. And no one has a bigger stake
in that than zillionaires like us.
The oldest and most important conflict in human societies is the battle over
the concentration of wealth and power. The folks like us at the top have always
told those at the bottom that our respective positions are righteous and good
for all. Historically, we called that divine right. Today we have trickle-down
economics.
What nonsense this is. Am I really such a superior person? Do I belong at
the center of the moral as well as economic universe? Do you?
My family, the Hanauers, started in Germany selling feathers and pillows.
They got chased out of Germany by Hitler and ended up in Seattle owning another
pillow company. Three generations later, I benefited from that. Then I got as
lucky as a person could possibly get in the Internet age by having a buddy in
Seattle named Bezos. I look at the average Joe on the street, and I say, "There
but for the grace of Jeff go I." Even the best of us, in the worst of circumstances,
are barefoot, standing by a dirt road, selling fruit. We should never forget
that, or forget that the United States of America and its middle class made
us, rather than the other way around.
Or we could sit back, do nothing, enjoy our yachts. And wait for the pitchforks.
"You're living in poverty, your schools are no good, you have no jobs, 58% of your youth is unemployed.
What the hell do you have to lose" by voting for Trump? the candidate asked. "At the end of four
years, I guarantee I will get over 95% of the African American vote."
The statement – highly unlikely given how poorly Republicans fare among black voters – continues
a theme the GOP presidential nominee has pounded this week as he courted African American voters.
He said Democrats take black voters for granted and have ignored their needs while governing cities
with large African American populations.
"America must reject the bigotry of Hillary Clinton, who sees communities of color only as votes,
not as human beings worthy of a better future," he said of his Democratic opponent.
... ... ...
Trump argued that Democratic presidential nominee Hillary Clinton's policies on issues such as
immigration and refugee resettlement harm African Americans.
=== quote ===
It has recently become commonplace to argue that globalization can leave people behind, and that
this can have severe political consequences. Since 23 June, this has even become conventional
wisdom. While I welcome this belated acceptance of the blindingly obvious, I can't but help feeling
a little frustrated, since this has been self-evident for many years now. What we are seeing,
in part, is what happens to conventional wisdom when, all of a sudden, it finds that it can no
longer dismiss as irrelevant something that had been staring it in the face for a long time.
=== end of quote ==
This is not about "conventional wisdom". This is about the power of neoliberal propaganda,
the power of brainwashing and indoctrination of population via MSM, schools and universities.
And "all of a sudden, it finds that it can no longer dismiss as irrelevant something that had
been staring it in the face for a long time." also has nothing to do with conventional wisdom.
This is about the crisis of neoliberal ideology and especially Trotskyism part of it (neoliberalism
can be viewed as Trotskyism for the rich). The following integral elements of this ideology no
longer work well and are starting to cause the backlash:
1. High level of inequality as the explicit, desirable goal (which raises the productivity).
"Greed is good" or "Trickle down economics" -- redistribution of wealth up will create (via higher
productivity) enough scrapes for the lower classes, lifting all boats.
2. "Neoliberal rationality" when everything is a commodity that should be traded at specific
market. Human beings also are viewed as market actors with every field of activity seen as a specialized
market. Every entity (public or private, person, business, state) should be governed as a firm.
"Neoliberalism construes even non-wealth generating spheres-such as learning, dating, or exercising-in
market terms, submits them to market metrics, and governs them with market techniques and practices."
People are just " human capital" who must constantly tend to their own present and future market
value.
3. Extreme financialization or converting the economy into "casino capitalism" (under neoliberalism
everything is a marketable good, that is traded on explicit or implicit exchanges.
4. The idea of the global, USA dominated neoliberal empire and related "Permanent war for permanent
peace" -- wars for enlarging global neoliberal empire via crushing non-compliant regimes either
via color revolutions or via open military intervention.
5. Downgrading ordinary people to the role of commodity and creating three classes of citizens
(moochers, or Untermensch, "creative class" and top 0.1%), with the upper class (0.1% or "Masters
of the Universe") being above the law like the top level of "nomenklatura" was in the USSR.
6. "Downsizing" sovereignty of nations via international treaties like TPP, and making transnational
corporations the key political players, "the deciders" as W aptly said. Who decide about level
of immigration flows, minimal wages, tariffs, and other matters that previously were prerogative
of the state.
So after 36 (or more) years of dominance (which started with triumphal march of neoliberalism
in early 90th) the ideology entered "zombie state". That does not make it less dangerous but its
power over minds of the population started to evaporate. Far right ideologies now are filling
the vacuum, as with the discreditation of socialist ideology and decimation of "enlightened corporatism"
of the New Deal in the USA there is no other viable alternatives.
The same happened in late 1960th with the Communist ideology. It took 20 years for the USSR
to crash after that with the resulting splash of nationalism (which was the force that blow up
the USSR) and far right ideologies.
It remains to be seen whether the neoliberal US elite will fare better then Soviet nomenklatura
as challenges facing the USA are now far greater then challenges which the USSR faced at the time.
Among them is oil depletion which might be the final nail into the coffin of neoliberalism and,
specifically, the neoliberal globalization.
"... As the de facto test subjects for the inexorable media-fueled march of this ubiquitous global model, disparate groups worldwide have become the unwitting faces of revolt against inevitability. Anonymized behind the august facades of global financial institutions, neoliberal capitalism under TINA has produced political rage, confusion, panic and a worldwide search for scapegoats and alternatives across the political spectrum. ..."
"... McWorld cuts its destructive path under a self-promoting presumption of historic inevitability, because after more than four decades of the TINA narrative, the underlying rationale of market predestination is no longer economic. It is theological. ..."
"... Descriptions such as "free-market fundamentalism" and "market orthodoxy" are not mere figures of speech. They point to a deeper, technologically powered religious metamorphosis of capitalism that needs to be understood before a meaningful political response can be mounted. One does not have to be Christian, nor Catholic, to appreciate Pope Francis' warnings against the danger to Christian values from "a deified market" with its "globalization of indifference." The pope is explicitly acknowledging a new theology of capital whose core ethos runs counter to the values of both classical and religious humanism. ..."
"... Under the radically altered metaphysics of theologized capitalism, market outcomes are sacred and inevitable. Conversely, humanity and the natural world have been desacralized and defined as malleable forms of expendable and theoretically inexhaustible capital. Even life-sustaining ecosystems and individual human subjectivity are subsumed under a market rubric touted as historically preordained. ..."
"... Economic historian Karl Polanyi warned in 1944 that a false utopian belief in the ability of unfettered markets to produce naturally balanced outcomes would produce instead a dystopian "stark utopia." Today's political chaos represents a spontaneous and uncoordinated eruption of resistance against this encroaching sense of inevitable dystopianism. As Barber noted, what he refers to as "Jihad" is not a strictly Islamic phenomenon. It is localism, tribalism, particularism or sometimes classical republicanism taking a stand, often violently, acting as de facto social and political antibodies against the viral contagions of McWorld. ..."
"... The historically ordained march of theologized neoliberal capitalism depends for its continuation on a belief by individuals that they are powerless against putatively inevitable forces of market-driven globalization. ..."
"... One lesson nonetheless seems clear. The "power of the powerless" has been awakened globally. Whether this awakening will spark a movement towards equitable, ecologically sustainable democratic self-governance is an open question. ..."
In the wake of the June 23 Brexit vote, global media have bristled with headlines
declaring the Leave victory to be the latest sign of a historic
rejection of "globalization" by working-class voters on both sides of the
Atlantic. While there is an element of truth in this analysis, it misses the
deeper historical currents coursing beneath the dramatic headlines. If our politics
seem disordered at the moment, the blame lies not with globalization alone but
with the "There Is No Alternative" (TINA) philosophy of neoliberal market inevitability
that has driven it for nearly four decades.
British Prime Minister Margaret Thatcher introduced the TINA acronym to the
world in a 1980 policy speech that proclaimed
"There Is No Alternative" to a global neoliberal capitalist order. Thatcher's
vision for this new order was predicated on the market-as-god economic philosophy
she had distilled from the work of
Austrian School economists such as Friedrich Hayek and her own fundamentalist
Christian worldview. Western political life today has devolved into a series
of increasingly desperate and inchoate reactions against a sense of fatal historical
entrapment originally encoded in Thatcher's TINA credo of capitalist inevitability.
If this historical undercurrent is ignored, populist revolt will not produce
much-needed democratic reform. It will instead be exploited by fascistic nationalist
demagogues and turned into a dangerous search for political scapegoats.
The Rebellion Against Inevitability
Thatcher's formulation of neoliberal inevitability manifested itself in a
de facto policy cocktail of public sector budget cuts, privatization, financial
deregulation, tax cuts for the rich, globalization of capital flows and militarization
that were the hallmarks of her administration and a
template for the future of the world's developed economies. After the 1991
collapse of the Soviet Union, whose coercive state socialism represented capitalism's
last great power alternative, the underlying philosophy of economic inevitability
that informed TINA seemed like a prescient divination of cosmic design, with
giddy neoconservatives declaring the "end of history" and the triumph of
putatively democratic capitalism over all other historical alternatives.
Nearly four decades later, with neoliberalism having swept the globe in triumph
through a mix of technological innovation, exploitative financial engineering
and brute force, eclipsing its tenuous democratic underpinnings in the process,
disgraced British Prime Minister David Cameron maintained his devotion to TINA
right up to the moment of Brexit. In a 2013 speech delivered as his government
was preparing a
budget that proposed 40 percent cuts in social welfare spending , sweeping
privatization, wider war in Central Asia and continued austerity, he lamented
that "If there was another way, I would take it.
But there
is no alternative." Although they may want a change of makeup or clothes,
every G7 head of state heeds TINA's siren song of market inevitability.
As the de facto test subjects for the inexorable media-fueled march of
this ubiquitous global model, disparate groups worldwide have become the unwitting
faces of revolt against inevitability. Anonymized behind the august facades
of global financial institutions, neoliberal capitalism under TINA has produced
political rage, confusion, panic and a worldwide search for scapegoats and alternatives
across the political spectrum.
The members of ISIS have rejected the highest ideals of Islam in their search
for an alternative. Environmental activists attempt to counter the end-of-history
narrative at the heart of TINA with the scientific inevitability of global climate-induced
ecological catastrophe. Donald Trump offers a racial or foreign scapegoat for
every social and economic malady created by TINA, much like the far-right nationalist
parties emerging across Europe, while Bernie Sanders focuses on billionaires
and Wall Street. Leftist movements such as Podemos in Spain or Syriza in Greece
also embody attempted declarations of revolt against the narrative of inevitability,
as do the angry votes for Brexit in England and Wales.
Without judging or implying equality in the value of these varied expressions
of resistance, except to denounce the murderous ethos of ISIS and any other
call to violence or racism, it is clear that each offers seeming alternatives
to TINA's suffocating inevitability, and each attracts its own angry audience.
"Jihad" vs. "McWorld" and the New Theology of Capital
Benjamin Barber's 1992 essay and subsequent book, Jihad vs. McWorld
, is a better guide to the current politics of rage than the daily news
media. Barber describes a historic post-Soviet clash between the identity politics
of tribalism ("Jihad") and the forced financial and cultural integration of
corporate globalism ("McWorld").
McWorld is the financially integrated and omnipresent transnational order
of wired capitalism that has anointed itself the historic guardian of Western
civilization. It is viciously undemocratic in its pursuit of unrestricted profits
and violently punitive in response to any hint of economic apostasy. (See
Greece .) This new economic order offers the illusion of modernity with
its globally wired infrastructure and endless stream of consumerist spectacles,
but beneath the high-tech sheen, it is
spiritually empty , predicated on
permanent war ,
global poverty and is
destroying the biosphere .
McWorld cuts its destructive path under a self-promoting presumption
of historic inevitability, because after more than four decades of the TINA
narrative, the underlying rationale of market predestination is no longer economic.
It is theological. A historic transformation of market-based economic ideology
into theology underpins modern capitalism's instrumentalized view of human nature
and nature itself.
Descriptions such as
"free-market fundamentalism" and "market orthodoxy" are not mere figures
of speech. They point to a deeper, technologically powered religious metamorphosis
of capitalism that needs to be understood before a meaningful political response
can be mounted. One does not have to be Christian, nor Catholic, to appreciate
Pope Francis' warnings against the danger to Christian values from "a deified
market" with its "globalization of indifference." The pope is explicitly acknowledging
a new theology of capital whose core ethos runs counter to the values of both
classical and religious humanism.
Under the radically altered metaphysics of theologized capitalism, market
outcomes are sacred and inevitable. Conversely, humanity and the natural world
have been desacralized and defined as malleable forms of expendable and theoretically
inexhaustible capital. Even life-sustaining ecosystems and individual human
subjectivity are subsumed under a market rubric touted as historically preordained.
This is a crucial difference between capitalism today and capitalism even
50 years ago that is not only theological but apocalyptic in its refusal to
acknowledge limits. It has produced a global, social and economic order that
is increasingly feudal, while also connected via digital technologies.
Economic historian
Karl Polanyi warned in 1944 that a false utopian belief in the ability of
unfettered markets to produce naturally balanced outcomes would produce instead
a dystopian "stark utopia." Today's political chaos represents a spontaneous
and uncoordinated eruption of resistance against this encroaching sense of inevitable
dystopianism. As Barber noted, what he refers to as "Jihad" is not a strictly
Islamic phenomenon. It is localism, tribalism, particularism or sometimes classical
republicanism taking a stand, often violently, acting as de facto social and
political antibodies against the viral contagions of McWorld.
Pessimistic Optimism
The historically ordained march of theologized neoliberal capitalism
depends for its continuation on a belief by individuals that they are powerless
against putatively inevitable forces of market-driven globalization. It
is too early to know where the widely divergent outbreaks of resistance on display
in 2016 will lead, not least because they are uncoordinated, often self-contradictory
or profoundly undemocratic, and are arising in a maelstrom of confusion about
core causation.
One lesson nonetheless seems clear. The
"power of the powerless" has been awakened globally. Whether this awakening
will spark a movement towards equitable, ecologically sustainable democratic
self-governance is an open question. Many of today's leading political
theorists caution against an
outdated Enlightenment belief in progress and extol the
virtues of philosophic pessimism as a hedge against historically groundless
optimism. Amid today's fevered populist excitements triggered by a failure of
utopian faith in market inevitability, such cautionary thinking seems like sound
political advice. Copyright, Truthout. May not be reprinted without
permission .
Michael Meurer is the founder of Meurer Education, a project offering classes
on the US political system in Latin American universities while partnering with
local education micro-projects to assist them with publicity and funding. Michael
is also president of Meurer Group & Associates, a strategic consultancy with
offices in Los Angeles and Denver.
"... It is fascinating that younger US neoliberals (e.g. Matthew Yglesias) are totally sold on the the positives of 'metrics', statistics, testing, etc, to the point where they ignore all the negatives of those approaches, but absolutely and utterly loathe being tracked, having the performance of their preferred policies and predictions analyzed, and called out on the failures thereof. Is sure seems to me that the campaign to quash the use of the US, Charles Peters version of neoliberal is part of the effort to avoid accountability for their actions. ..."
"... If "conservative" is to be a third way to the opposition of "reactionary" and "revolutionary", the "liberals" are a species of conservative - like all conservatives, seeking to preserve the existing order as far as this is possible, but appealing to reason, reason's high principles, and a practical politics of incremental reform and "inevitable" progress. The liberals disguise their affection for social and political hierarchy as a preference for "meritocracy" and place their faith in the powers of Reason and Science to discover Truth. ..."
"... Liberalism adopts nationalism as a vehicle for popular mobilization which conservatives can share and as an ideal of governance, the self-governing democratic nation-state with a liberal constitution. ..."
"... It wasn't Liberalism Triumphant that faced a challenge from fascism; it was the abject failures of Liberalism that created fascism. ..."
"... he Liberal projects to create liberal democratic nation-states ran aground in Germany, Austria-Hungary and Russia between 1870 and 1910 and instead of gradual reform of the old order, Europe experienced catastrophic collapse, and Liberalism was ill-prepared to devise working governments and politics in the crisis that followed. ..."
"... What is called neoliberalism in American politics has a lot to do with New Deal liberalism running out of steam and simply not having a program after 1970. Some of that is circumstantial in a way - the first Oil Crisis, the breakup of Bretton Woods - but even those circumstances were arguably results of the earlier program's success. ..."
= = = I am actually honestly suggesting an intellectual exercise which, I think, might
be worth your (extremely valuable) time. I propose you rewrite this post without using the
word "neoliberalism" (or a synonym). = = =
It is fascinating that younger US neoliberals (e.g. Matthew Yglesias) are totally sold
on the the positives of 'metrics', statistics, testing, etc, to the point where they ignore all
the negatives of those approaches, but absolutely and utterly loathe being tracked, having the
performance of their preferred policies and predictions analyzed, and called out on the failures
thereof. Is sure seems to me that the campaign to quash the use of the US, Charles Peters version
of neoliberal is part of the effort to avoid accountability for their actions.
bruce wilder 09.03.16 at 7:47 pm
In the politics of antonyms, I suppose we are always going get ourselves confused.
Perhaps because of American usage of the root, liberal, to mean the mildly social democratic
New Deal liberal Democrat, with its traces of American Populism and American Progressivism, we
seem to want "liberal" to designate an ideology of the left, or at least, the centre-left. Maybe,
it is the tendency of historical liberals to embrace idealistic high principles in their contest
with reactionary claims for hereditary aristocracy and arbitrary authority.
If "conservative" is to be a third way to the opposition of "reactionary" and "revolutionary",
the "liberals" are a species of conservative - like all conservatives, seeking to preserve the
existing order as far as this is possible, but appealing to reason, reason's high principles,
and a practical politics of incremental reform and "inevitable" progress. The liberals disguise
their affection for social and political hierarchy as a preference for "meritocracy" and place
their faith in the powers of Reason and Science to discover Truth.
All of that is by way of preface to a thumbnail history of modern political ideology different
from the one presented by Will G-R.
Modern political ideology is a by-product of the Enlightenment and the resulting imperative
to find a basis and purpose for political Authority in Reason, and apply Reason to the design
of political and social institutions.
Liberalism doesn't so much defeat conservatism as invent conservatism as an alternative to
purely reactionary politics. The notion of an "inevitable progress" allows liberals to reconcile
both themselves and their reactionary opponents to practical reality with incremental reform.
Political paranoia and rhetoric are turned toward thinking about constitutional design.
Mobilizing mass support and channeling popular discontents is a source of deep ambivalence
and risk for liberals and liberalism. Popular democracy can quickly become noisy and vulgar, the
proliferation of ideas and conflicting interests paralyzing. Inventing a conservatism that competes
with the liberals, but also mobilizes mass support and channels popular discontent, puts bounds
on "normal" politics.
Liberalism adopts nationalism as a vehicle for popular mobilization which conservatives
can share and as an ideal of governance, the self-governing democratic nation-state with a liberal
constitution.
I would put the challenges to liberalism from the left and right well behind in precedence
the critical failures and near-failures of liberalism in actual governance.
Liberalism failed abjectly to bring about a constitutional monarchy in France during the first
decade of the French Revolution, or a functioning deliberative assembly or religious toleration
or even to resolve the problems of state finance and legal administration that destroyed the ancient
regime. In the end, the solution was found in Napoleon Bonaparte, a precedent that would arguably
inspire the fascism of dictators and vulgar nationalism, beginning with Napoleon's nephew fifty
years later.
It wasn't Liberalism Triumphant that faced a challenge from fascism; it was the abject
failures of Liberalism that created fascism. And, this was especially true in the wake of
World War I, which many have argued persuasively was Liberalism's greatest and most catastrophic
failure. T he Liberal projects to create liberal democratic nation-states ran aground in Germany,
Austria-Hungary and Russia between 1870 and 1910 and instead of gradual reform of the old order,
Europe experienced catastrophic collapse, and Liberalism was ill-prepared to devise working governments
and politics in the crisis that followed.
If liberals invented conservatism, it seems to me that would-be socialists were at pains to
re-invent liberalism, and they did it several times going in radically different directions, but
always from a base in the basic liberal idea of rationalizing authority. A significant thread
in socialism adopted incremental progress and socialist ideas became liberal and conservative
means for taming popular discontent in an increasingly urban society.
Where and when liberalism actually was triumphant, both the range of liberal views and the
range of interests presenting a liberal front became too broad for a stable politics. Think about
the Liberal Party landslide of 1906, which eventually gave rise to the Labour Party in its role
of Left Party in the British two-party system. Or FDR's landslide in 1936, which played a pivotal
role in the march of the Southern Democrats to the Right. Or the emergence of the Liberal Consensus
in American politics in the late 1950s.
What is called neoliberalism in American politics has a lot to do with New Deal liberalism
running out of steam and simply not having a program after 1970. Some of that is circumstantial
in a way - the first Oil Crisis, the breakup of Bretton Woods - but even those circumstances were
arguably results of the earlier program's success.
It is almost a rote reaction to talk about the Republican's Southern Strategy, but they didn't
invent the crime wave that enveloped the country in the late 1960s or the riots that followed
the enactment of Civil Rights legislation.
Will G-R's "As soon [as] liberalism feels it can plausibly claim to have . . .overcome the
socialist and fascist challenges [liberals] are empowered to act as if liberalism's adaptive response
to the socialist and fascist challenges was never necessary in the first place - bye bye welfare
state, hello neoliberalism" doesn't seem to me to concede enough to Clinton and Blair entrepreneurially
inventing a popular politics in response to Reagan and Thatcher, after the actual failures
of an older model of social democratic programs and populist politics on its behalf.
I write more about this
over at
my blog (in a somewhat different context).
John Quiggin 09.04.16 at 6:57 am
RW @113 I wrote a whole book using "market liberalism" instead of "neoliberalism", since I wanted
a term more neutral and less pejorative. So, going back to "neoliberalism" was something I did
advisedly. You say
The word is abstract and has completely different meanings west and east of the Atlantic. In
the USA it refers to weak tea center leftisms. In Europe to hard core liberalism.
Well, yes. That's precisely why I've used the term, introduced the hard/soft distinction and explained
the history. The core point is that, despite their differences soft (US meaning) and hard (European
meaning) neoliberalism share crucial aspects of their history, theoretical foundations and policy
implications.
=== quote ===
Neoliberalism is an ideology of market fundamentalism based on deception that promotes "markets"
as a universal solution for all human problems in order to hide establishment of neo-fascist regime
(pioneered by Pinochet in Chile), where militarized government functions are limited to external
aggression and suppression of population within the country (often via establishing National Security
State using "terrorists" threat) and corporations are the only "first class" political players.
Like in classic corporatism, corporations are above the law and can rule the country as they see
fit, using political parties for the legitimatization of the regime.
The key difference with classic fascism is that instead of political dominance of the corporations
of particular nation, those corporations are now transnational and states, including the USA are
just enforcers of the will of transnational corporations on the population. Economic or "soft"
methods of enforcement such as debt slavery and control of employment are preferred to brute force
enforcement. At the same time police is militarized and due to technological achievements the
level of surveillance surpasses the level achieved in Eastern Germany.
Like with bolshevism in the USSR before, high, almost always hysterical, level of neoliberal
propaganda and scapegoating of "enemies" as well as the concept of "permanent war for permanent
peace" are used to suppress the protest against the wealth redistribution up (which is the key
principle of neoliberalism) and to decimate organized labor.
Multiple definitions of neoliberalism were proposed. Three major attempts to define this social
system were made:
Definitions stemming from the concept of "casino capitalism"
Definitions stemming from the concept of Washington consensus
Definitions stemming from the idea that Neoliberalism is Trotskyism for the rich. This
idea has two major variations:
Definitions stemming from Professor Wendy Brown's concept of Neoliberal rationality
which developed the concept of Inverted Totalitarism of Sheldon Wolin
Definitions stemming Professor Sheldon Wolin's older concept of Inverted Totalitarism
- "the heavy statism forging the novel fusions of economic with political power that he
took to be poisoning democracy at its root." (Sheldon Wolin and Inverted Totalitarianism
Common Dreams )
The first two are the most popular.
likbez 09.04.16 at 5:03 pm
bruce,
@117
Thanks for your post. It contains several important ideas:
"It wasn't Liberalism Triumphant that faced a challenge from fascism; it was the abject failures
of Liberalism that created fascism."
"What is called neoliberalism in American politics has a lot to do with New Deal liberalism
running out of steam and simply not having a program after 1970. Some of that is circumstantial
in a way - the first Oil Crisis, the breakup of Bretton Woods - but even those circumstances were
arguably results of the earlier program's success."
Moreover as Will G-R noted:
"neoliberalism will be every bit the wellspring of fascism that old-school liberalism was."
Failure of neoliberalism revives neofascist, far right movements. That's what the rise of far
right movements in Europe now demonstrates pretty vividly.
"... The article cheekily flags the infamous case of the Chicago Boys, Milton Friedman's followers in Pinochet's Chile, as having been falsely touted as a success. If anything, the authors are too polite in describing what a train wreck resulted. A plutocratic land grab and speculation-fueled bubble led quickly to a depression, forcing Pinochet to implement Keynesian policies, as well as rolling back labor "reforms," to get the economy back on its feet. ..."
"... Overly mobile capital , meaning unrestricted cross-border money flows. The IMF paper points out that while the neoliberals claim that freely mobile money helps growth, there's not much concrete evidence to support that. By contrast, higher levels of capital flows lead to more instability and more frequent and severe financial and economic crisis. Ken Rogoff and Carmen Reinhart determined that high levels of international capital flows were strongly correlated with bigger and nastier financial crises. The BIS also made a persuasive, well-documented case that excessive "financial elasticity" which means lots of cross-border funds mobility that can quickly collapse, was the cause of the 2008 crisis. ..."
"... It's also hard to see how highly mobile money can be a plus, particularly for smaller and even not so small economies. Look at the how much the yen has moved over the past decade. How can investors in things that would actually make an economy more productive (foreign direct investment, such as factories and other operations) make any kind of accurate assessment of returns to cross border investment with so much foreign exchange volatility? And that uncertainty will lead a foreign investor to require a higher rate of return. Similarly, even if there were measurable benefits from highly mobile money movements, the costs of the busts need to be offset against that. It's pretty hard to see how you "offset" the cost of the blowup just past, whose total cost is estimated at one times global GDP. ..."
"... The publication of this IMF paper is a sign that the zeitgeist is, years after the crisis, finally shifting. It is becoming too hard to maintain the pretense that the policies that produced the global financial crisis, which are almost entirely still intact, are working. And the elites and their economic alchemists may also recognize that if they don't change course pretty soon, they risk the loss of not just legitimacy but control. With Trump and Le Pen at the barricades, the IMF wake-up call may be too late. ..."
"... Call me a cynic, but something tells me this won't change anything for the people currently suffering under the IMF yoke. IMF has put out plenty of papers that actually take a realistic look at the world, but it hasn't stopped them from pursuing policies essentially guaranteed to immiserate the majority of the population. ..."
"... you finally figured out that neo-liberalism isn't all it's cracked up to be? Well what a bunch of frickin' geniuses! ..."
"... The point of the shifting rhetoric is not to introduce policies that will better serve the poor, or the citizenry generally, it is a defensive action on the part of the elites to maintain their legitimacy and control. ..."
"... even worse, it just proves that they are able to learn to speak the right language about the economy. while we peons wait on for the inevitable co-optation and corruption of it towards elite ends once again. ..."
"... All power flows from the barrel of a gun. ..."
"... Jefferson – Nice treason going eh? Boy some overconfident are in for a shock. The French army thought they were the shit until longbowmen showed up. Enough said. As to this article. No, there is no free lunch. There could be a free snack if the money was directed at productive endeavors. But they did not and now trust and the social contract is totally broken. Even Larry Summers by 2010 was calling for a new one. That all said, the last 40 years elite did get some good advancements in science and medicine done. I'll give credit where it is due but the empire building shit isn't a plus, that is for sure. ..."
"... Something that always bears repeating is that a split in elite factions is essential to implementing real change. Access to power, money, and influence is what is needed to move society in any direction. Thru my own experience in life, I find most people are not sociopaths, they generally will direct their actions in benevolent manner if the overall social convention is to do so. This is why leadership is so important, and points to the true crisis of our time. We have a crisis of leadership. ..."
"... The split in elite thinking is showing itself because we have reached a crisis point and the elite are finally feeling the heat. While it is easy to paint these class divisions with a broad brush, there is an underlying dynamic of the classes that has been lost in recent years. The sense of duty to ones people and nation. What we have now, at least in America, is a confused mess. You cannot serve the nation by impoverishing its people. ..."
"... Like Lord Ashby's observations that it typically takes 200 years before new knowledge makes its way into policies and institutions. Reduce that time somewhat due to internet, but even so his point is well made. He argues that policies and institutions only incorporate the new knowledge once a significant percentage of the general public has already accepted it. This says to me that new thinking has to happen from the ground up, and we should not expect it to happen from the top down. ..."
"... What's the old saying – "A new scientific truth does not triumph by convincing its opponents and making them see the light, but rather because its opponents eventually die, and a new generation grows up that is familiar with it." ..."
"... "Unrestricted cross-border money flows" absolutely shouts dynamic instability from the get go and how could it be otherwise? Foreign direct investment also smells of absentee cross-border slum lord -ism; out of sight out of mind irresponsibility. Common currency (the Euro) wipes out fault tolerance and resiliency in the system and hard wires contagion. Nobody even discusses trade imbalance instability from so-called "free trade". ..."
"... Neoliberal policy is to replace men, with whatever combined circuit is most efficient. It's not rocket science. ..."
"... Yves may wish to weigh in with a more detailed explanation (here is a recent treatment of the "neoliberal thought collective" ) but "Neoliberalism Expressed as Simple Rules" for rules of thumb that will enable you to detect neoliberals in your ordinary dealings in comment sections and on the twitter. If your interlocutor, for example, has a dogmatic faith in the workings of markets, you're dealing with a neoliberal. ..."
"... I would say neoliberalism has been the dominant ideology, across the board, since the mid-70s (in other words, pre-Reagan). I'd have a hard time finding any policy that fits within the Overton Window of permitted discourse of DC, from left to right, that is not neoliberal, scholastics-level fine-grained faction-driven distinctions aside. The current stasis of the Overton Window is being challenged a bit by the Sanders campaign (from the left) and the Trump campaign (from the right), granting for a moment that politics are bipolar. Too long an answer, I know! ..."
"... Please see Recent Items. We have a post on the Mirowski's paper on the Neoliberal Though Collective prominently displayed. ..."
"... How about this; hyper aggressive top down global economic integration no matter what the fallout. ..."
"... Keep the masses ignorant, wanting and distracted. Under the current social system, you are offered a choice: Be "SMART" and join in on the looting, or be exploited as one to the sheep. It seems humanity must evolve to a third position- one of collective benefit and sustainability or end in extinction. ..."
"... Neither a swindler nor a sucker be. Neither a looter nor a victim be. ..."
"... The Central Banks produced low inflation figures in the US, while massive inflation was occurring in the costs of housing, education and healthcare causing the cost of living to sky rocket. This fictitious inflation figure targeting seems to be a rather pointless exercise. There is no point in producing low inflation figures while the cost of living is sky rocketing. A global youth now sit at home with their parents unable to afford to move out due to high mortgage payments and rent. They are not starting families and the demographic problems are going to get a whole lot worse. Why is global aggregate demand so low? Suppressed wages with sky rocketing costs of living. Neo-Liberalism really is just silly. ..."
"... A look at the UK. We have followed the US idea of paid further education. One of the first things the US banks did in 2008 was to get the Government to back student loans as they were beginning to default on a large scale. In the UK we have linked repayments to RPI and not the CPI figure the Central Bank targets. The usual silliness for masking the rising costs of living and an opportunity to rip off young people. Another idea, unregulated, trickle down capitalism, which we had in the UK in the 19th Century. In the 19th Century those at the top were very wealthy those at the bottom lived in abject poverty, no trickledown. The first regulations to deal with wealthy UK businessman seeking profit, the abolition of slavery and child labour. ..."
"... If we abolish Free Trade and restore Protectionism, the American minimum wage won't HAVE to compete with China. Free Trade is the new Slavery. Protectionism is the new Abolition. ..."
"... The IMF is trying to wash its own face now. Too late. Both the IMF and the WB must stand Trial for Crimes Against Humanity. ..."
While the IMF's research team has for many years chipped away at mainstream economic thinking,
a short, accessible paper makes an even more frontal challenge. It's caused such a stir that the
Financial Times
featured
it on its front page . We've embedded it at the end of this post and encourage you to read it
and circulate it.
The article cheekily flags the infamous case of the Chicago Boys, Milton Friedman's followers
in Pinochet's Chile, as having been falsely touted as a success. If anything, the authors are too
polite in describing what a train wreck resulted. A plutocratic land grab and speculation-fueled
bubble led quickly to a depression, forcing Pinochet to implement Keynesian policies, as well as
rolling back labor "reforms," to get the economy back on its feet.
The papers describes three ways in which neoliberal reforms do more harm than good.
Overly mobile capital , meaning unrestricted cross-border money flows. The
IMF paper points out that while the neoliberals claim that freely mobile money helps growth, there's
not much concrete evidence to support that. By contrast, higher levels of capital flows lead to more
instability and more frequent and severe financial and economic crisis. Ken Rogoff and Carmen Reinhart
determined that high levels of international capital flows were strongly correlated with bigger and
nastier financial crises. The BIS also made a persuasive, well-documented case that excessive "financial
elasticity" which means lots of cross-border funds mobility that can quickly collapse, was the cause
of the 2008 crisis.
It's also hard to see how highly mobile money can be a plus, particularly for smaller and
even not so small economies. Look at the how much the yen has moved over the past decade. How can
investors in things that would actually make an economy more productive (foreign direct investment,
such as factories and other operations) make any kind of accurate assessment of returns to cross
border investment with so much foreign exchange volatility? And that uncertainty will lead a foreign
investor to require a higher rate of return. Similarly, even if there were measurable benefits from
highly mobile money movements, the costs of the busts need to be offset against that. It's pretty
hard to see how you "offset" the cost of the blowup just past, whose total cost is estimated at one
times global GDP.
Thus the paper argues that the heretical idea of capital controls can make sense as a way to choke
off a credit bubble stoked by foreign investment.
Austerity . The IMF article argues that while small countries may have no choice
other than to curtail their overall level of indebtedness, this is not a one-size-fits-all prescription.
For larger countries, running larger deficits, particularly after a financial crisis, is a better
option than belt-tighening.
This section of the article is frustrating, since it utterly fails to distinguish fiat currency
issuers from states that are not monetary sovereigns. It also blandly accepts the idea that high
levels of indebtedness are bad, when government debt increases typically make up for shortfalls in
private sector investment and demand. Recall that in the supposedly virtuous Clinton budget surplus
years, households, which are normally net savers in aggregate, managed to make up for the Federal
government fiscal drag by going on a big debt party. But it does have some zingers, at least by the
standards of policy wonkery:
Austerity policies not only generate substantial welfare costs due to supply-side channels,
they also hurt demand-and thus worsen employment and unemployment. The notion that fiscal consolidations
can be expansionary (that is, raise output and employment), in part by raising private sector
confidence and investment, has been championed by, among others, Harvard economist Alberto Alesina
in the academic world and by former European Central Bank President Jean-Claude Trichet in the
policy arena. However, in practice, episodes of fiscal consolidation have been followed, on average,
by drops rather than by expansions in output. On average, a consolidation of 1 percent of GDP
increases the long-term unemployment rate by 0.6 percentage point and raises by 1.5 percent within
five years the Gini measure of income inequality (Ball and others, 2013)
Depicting "fiscal consolidation" as snake oil is radical, at least among Serious Economists.
Increasing inequality . The paper gratifyingly says that both austerity and highly
mobile capital increase inequality, and inequality is a negative for growth. And it firmly says Something
Must Be Done:
The evidence of the economic damage from inequality suggests that policymakers should be more
open to redistribution than they are.Of course, apart from redistribution, policies could be designed
to mitigate some of the impacts in advance-for instance, through increased spending on education
and training, which expands equality of opportunity (so-called predistribution policies). And
fiscal consolidation strategies-when they are needed-could be designed to minimize the adverse
impact on low-income groups. But in some cases, the untoward distributional consequences will
have to be remedied after they occur by using taxes and government spending to redistribute income.
Fortunately, the fear that such policies will themselves necessarily hurt growth is unfounded.
Mind you, this article is far from ideal. For instance, careful readers will see that it treats
the debunked loanable funds theory as valid.
In some ways, the fact that this article was written at all, and that it is apparently fomenting
debate in policy circles is more important than the details of its argument, since it does not break
new ground. Instead, it takes some of the findings and analysis of heterodox and forward-thinking
development economists and distills them nicely.
The publication of this IMF paper is a sign that the zeitgeist is, years after the crisis,
finally shifting. It is becoming too hard to maintain the pretense that the policies that produced
the global financial crisis, which are almost entirely still intact, are working. And the elites
and their economic alchemists may also recognize that if they don't change course pretty soon, they
risk the loss of not just legitimacy but control. With Trump and Le Pen at the barricades, the IMF
wake-up call may be too late.
Call me a cynic, but something tells me this won't change anything for the people currently
suffering under the IMF yoke. IMF has put out plenty of papers that actually take a realistic
look at the world, but it hasn't stopped them from pursuing policies essentially guaranteed to
immiserate the majority of the population. Talk is cheap, in other words. The IMF has caused
so much suffering and been responsible for propagandizing so much BS over the years that reports
like this just don't move me at all. Oh really , I think, you finally figured out
that neo-liberalism isn't all it's cracked up to be? Well what a bunch of frickin' geniuses!
The publication of this IMF paper is a sign that the zeitgeist is, years after the crisis,
finally shifting. It is becoming too hard to maintain the pretense that the policies that produced
the global financial crisis, which are almost entirely still intact, are working. And the elites
and their economic alchemists may also recognize that if they don't change course pretty soon,
they risk the loss of not just legitimacy but control.
The point of the shifting rhetoric is not to introduce policies that will better serve
the poor, or the citizenry generally, it is a defensive action on the part of the elites to maintain
their legitimacy and control.
i concur wholeheartedly with both of your above statements.
even worse, it just proves that they are able to learn to speak the right language about
the economy. while we peons wait on for the inevitable co-optation and corruption of it towards
elite ends once again.
The point of the shifting rhetoric is not to introduce policies that will better serve the
poor, or the citizenry generally, it is a defensive action on the part of the elites to maintain
their legitimacy and control.
Jefferson – Nice treason going eh? Boy some overconfident are in for a shock. The French
army thought they were the shit until longbowmen showed up. Enough said. As to this article. No,
there is no free lunch. There could be a free snack if the money was directed at productive endeavors.
But they did not and now trust and the social contract is totally broken. Even Larry Summers by
2010 was calling for a new one. That all said, the last 40 years elite did get some good advancements
in science and medicine done. I'll give credit where it is due but the empire building shit isn't
a plus, that is for sure.
That Tampa exercise is really something. Maybe it was a practice run to take out Maduro, since
they "messed it up" with Chavez. Or a warning to Others who don't play nice with the USA.
The IMF research side and the IMF program side operate separately from each other. However,
IMF research does influence other economists and media coverage. You are not going to see changes
in policy anywhere until you see changes in orthodox thinking.
And splits within the elites are a necessary but not sufficient condition for change. We are
seeing the start of a real split in the elites.
Something that always bears repeating is that a split in elite factions is essential to
implementing real change. Access to power, money, and influence is what is needed to move society
in any direction. Thru my own experience in life, I find most people are not sociopaths, they
generally will direct their actions in benevolent manner if the overall social convention is to
do so. This is why leadership is so important, and points to the true crisis of our time. We have
a crisis of leadership.
Two points that need to be driven home again and again. Government policy implemented in the
service of the people and the notion that the middle class was created thru public policy, not
some natural occurrence. It was a choice.
The split in elite thinking is showing itself because we have reached a crisis point and
the elite are finally feeling the heat. While it is easy to paint these class divisions with a
broad brush, there is an underlying dynamic of the classes that has been lost in recent years.
The sense of duty to ones people and nation. What we have now, at least in America, is a confused
mess. You cannot serve the nation by impoverishing its people.
True wealth, happiness, and stability can only be achieved through bonds of respect forged
between the ruling class and citizens. Without this functioning ideal, you will have strife and
hardship. The elite must make a choice. Keep doubling down on their oppression of the working
class, or decide they have a duty to humanity.
In the end, responsibility for ones actions in life cannot be avoided forever. As the destruction
of inequality grows ever more apparent, the elite must face their conscience or the mob, it would
seem to me, any sane person would rather choose the former than the later.
"IMF has put out plenty of papers that actually take a realistic look at the world, but it
hasn't stopped them from pursuing policies essentially guaranteed to immiserate the majority of
the population."
Not directly related to this subject, but this reminds me of book reviews. I have any number
of books that challenge orthodoxy of one kind or other (like, say, David Graeber's Debt: The First
5,000 Years) that feature quotes from reviews on the covers and first few pages that praise the
book as 'groundbreaking', 'important' etc. But then as far as I can see the publications that
issued those reviews absorb none of the new wisdom and continue parroting the status quo. Hell,
sometimes these books get awards or selected as best books of the year before whatever information
they contain is completely ignored.
Like Lord Ashby's observations that it typically takes 200 years before new knowledge makes
its way into policies and institutions. Reduce that time somewhat due to internet, but even so
his point is well made. He argues that policies and institutions only incorporate the new knowledge
once a significant percentage of the general public has already accepted it. This says to me that
new thinking has to happen from the ground up, and we should not expect it to happen from the
top down.
What's the old saying – "A new scientific truth does not triumph by convincing its opponents
and making them see the light, but rather because its opponents eventually die, and a new generation
grows up that is familiar with it."
And I'd say with something like economics, something much more similar to a religion than a
science, its more like "It ain't what you don't know that gets you into trouble. It's what you
know for sure that just ain't so"
1. Ignore it until it goes away.
2. Publish a counter example.
3. Claim that disaster will entail, and We Are Doing The Best We Can in an uncertain world, and
debt is bad because It Must Be Repaid.
4. Have an election, and Nothing Can Be Done until after the election (which is never in the US
because there is always an election looming)
5. Sex scandal. (The authorities have an ample supply, due to their pervasive surveillance)
6. If all else fails, then terrorism, because existential enemies, carefully built on a continuing
basis, and must have war, like Syria.
7. Refer it to a committee for further study.
"Unrestricted cross-border money flows" absolutely shouts dynamic instability from the
get go and how could it be otherwise? Foreign direct investment also smells of absentee cross-border
slum lord -ism; out of sight out of mind irresponsibility. Common currency (the Euro) wipes out
fault tolerance and resiliency in the system and hard wires contagion. Nobody even discusses trade
imbalance instability from so-called "free trade".
preterite: A person not elected to salvation by God? Not what my search says:
noun
1. a tense of verbs used to relate past action, formed in English by inflection of the verb, as
jumped, swam
2.a verb in this tense
adjective
3. denoting this tense
Word Origin
C14: from Late Latin praeteritum (tempus) past (time, tense), from Latin praeterīre to go by,
from preter- + īre to go
Add Pynchon to your search, or Calvinism.
One
blog post says:
Expat asks, what is Pynchon talking about when he refers to the "preterite?" Let me take
a hasty stab at an answer.
As I recall, the Calvinists thought that there were three kinds of people: the elect, the
preterite, and the damned. The elect are going to heaven. The damned very clearly are not.
The preterite can't be sure, so they do their very best to act like elect, since if they act
like the damned they won't be happy in the end.
3. Theol. A person not elected to salvation by God. Cf. preterition n. 3. rare.
1864 Fraser's Mag. May 533/2 The reprobates who are damned because they were always meant to be
damned, and the preterites who are damned because they were never meant to be saved.
2006 http://www.adequacy.org 5 Dec. (O.E.D.
Archive) Weren't the Elect who interbred with Preterites committing bestiality? Are they not therefore
condemned to Hell?
Admittedly rare, but as with Tom Allen nested in the comments, I came upon this meaning through
reading Thomas Pynchon's Gravity's Rainbow, and taking in his ruminations upon the Calvinist classes
of humans, the elect, the damned, and the preterite. Fit in very nicely with the story line. Fits
in all too well with the way of the world, in my opinion.
I'd conclude the Calvinists misused a word. The Latin root seems to Indictate this.
If we are not chosen, then I'd also assery we are the dammed.
The Calvinists indeed there is some hope for salvation for their definition of preterite.
However, the Calvinists have a harsh, unforgiving creed, and consequently do not appear to
me to meet our Lord's definitions, especially the "let him who is without sin cast the first stone"
and certainly miss "judge not."
I'd conclude the Calvinists misused a word. The Latin root seems to Indictate this.
If we are not chosen, then I'd also assert we are the dammed.
The Calvinists indeed there is some hope for salvation for their definition of preterite.
However, the Calvinists have a harsh, unforgiving creed, and consequently do not appear to
me to meet our Lord's definitions, especially the "let him who is without sin cast the first stone"
and certainly miss "judge not."
Neoliberal policy is to replace men, with whatever combined circuit is most efficient.
It's not rocket science. Last time we approached -Johnson & Johnson, your bait and swap inversion
specializing in the baby slave trade, Yves was talking about credit unions and I was talking about
Proctor & Gamble.
I have no use for peer friends, and recognize no enemy among a herd. Labor is a tribe, with
as many different spirits / passion as possible, NOT a pyramid of rotated peer pressure groups,
under the all seeing eye of debt as money.
Theories are like people, NOT R&D is r&d. I have been teaching young women AI programming right
in front of your eyes, essentially what I would teach my daughters, funny, just as if they were
at my armchair, before dinner, after she played with mommy all day. Serious time.
Just because you are surrounded physically, doesn't mean that you are the prisoner.
You are moving awfully fast. I think if you print out several pieces, and recombine the sentences,
you will find/ the answer.
Essentially, farming people is a tuning problem, through DNA filters. The bananas up a ladder
experiment (look it up).
Feminism and chauvinism have their trade offs, more now and less later. Well it's later, and
young women like my daughters, thrown in that black hole, are NOTS, who will be far better programmers
than anything currently on the planet. But. Proof is in the pudding.
i just realized that i dont know what neo-liberalism is, other than a pejorative i've heard
used dozens of times…i couldnt even tell you who is one, and who isnt..
Yves may wish to weigh in with a more detailed explanation (here is a recent treatment
of the
"neoliberal thought collective" ) but
"Neoliberalism Expressed as Simple Rules" for rules of thumb that will enable you to detect
neoliberals in your ordinary dealings in comment sections and on the twitter. If your interlocutor,
for example, has a dogmatic faith in the workings of markets, you're dealing with a neoliberal.
I would say neoliberalism has been the dominant ideology, across the board, since the mid-70s
(in other words, pre-Reagan). I'd have a hard time finding any policy that fits within the Overton
Window of permitted discourse of DC, from left to right, that is not neoliberal, scholastics-level
fine-grained faction-driven distinctions aside. The current stasis of the Overton Window is being
challenged a bit by the Sanders campaign (from the left) and the Trump campaign (from the right),
granting for a moment that politics are bipolar. Too long an answer, I know!
I understand your nuanced depth UASI but I think that commentator was asking in laymens term.
Liberalism is spending other peoples money. It can be used by government for good or evil. Neo
liberalism implies such term on steroids. An always fair question as a taxpayer is this.:
Does what I am being taxed for increase my security, freedom and potential upward mobility?
The last 40 years tells me no. Mixed bag sometimes, not all evil but certainly the wrong direction
and alarming. Not only does the looting damage opportunity but those that got the money by stealing
have the worst attitudes in the world. Anybody with one penny or position over you has a shitty
attitude. By the way, I am my own boss so my observations are neutral.
Having a business model and political system that hoovers it all into the top guarantees a
global slum. The 'isms' (capitalism vs socialism, fascism, communsm) and democrate vs. republican
wind up being a flimsy excuse but serious distraction from looting.
This current cycle of it is double standards and law, looting. Call it whatever you want. Robbery
is part of many species, but so is wising up to it and defending oneself.
The IMF knows this cycle of looting is near over so there is not cost abandoning an 'ism'.
But they do want you to think free lunch can always be had. The snack can be, leave math asidethe
reason why is some perception can become a reality. Debt issued for productive purpose can have
a multiplyer effect. But when issued to hand out in to crony buddies or consumption of some things,
the economy grinds down to near halt.
Had to explain the term while simply explaining the context. The why is as important as a term
or nothing can be learned or improved.
But, because we have an unlimited supply of money then government would be spending money that
belongs to no individual. There can be no deficit spending, only spending. The new economics system
would be one that distributes rather than redistributes, Society would decide the rules for such
distribution and individuals can still be denied their "fair share." Rules of exchange and possession
of money would guide our interactions But the most important aspect of an unlimited supply of
money is that as individuals small children would learn that they will have enough money to go
as far as their talents and efforts can take them; they will learn that they will have equal access
to resources, opportunities, rights, and protections that will enable them to build long lives
worth living.
So we really don't have to worry about the supply of money, we just have to worry about a society
that really does give young humans equal access to resources, opportunities, rights, and protections.
The only government that has come close to reaching that goal was the democracy of ancient Athens.
Athens did not have an unlimited supply of money, but they spent their money for the common
good which included giving some money to people who needed it as well as spending great sums for
the common good rather than giving equal shares of those sums to its citizens.
Under our current systems of government and economics an unlimited supply of money would make
the rich richer and the poor poorer.
Under a democracy that has an unlimited amount of money the GDP would become the ADI, average
domestic income, and our success would be measured by the level and the growth of the ADI.
I have no idea why this paper is even here on NC. Because decades later the IMF is saying,
well, maybe we were a little wrong? They had to butcher people to put this crap in power and butcher
people to keep this crap in power. That's not a little wrong. The economy exists for the people;
not the other way around.
For rjs: For a good start on what neoliberalism means, a base definition to start with is the
exact opposite of Benedict@Large's statement above, "The economy exists for the people".
Most sane people feel that economic "science" is inherently a social, soft, science and that
economics as a field of study and policy determination exists to serve the people The neoliberal
contingent feels the economy is "the invisible hand", equivalent to God. We exist to serve the
economy.
Didn't anyone read John Gray? He laid bare all the neo-liberal fallacies in his 1998 book:
"False Dawn, The Delusions of Global Capitalism". So now the IMF comes along 18 years later and
states what was explained nearly two decades ago. Gray is an intellectual giant in a land of fools
so nobody paid any attention to him.
Keep the masses ignorant, wanting and distracted. Under the current social system, you
are offered a choice: Be "SMART" and join in on the looting, or be exploited as one to the sheep.
It seems humanity must evolve to a third position- one of collective benefit and sustainability
or end in extinction.
About time, the IMF and World Bank have been using these ideas for decades even before they
were adopted globally under the "Neo-Liberal" ideology.
They have a track record of nearly 50 years of unmitigated disaster.
When South American and African nations were in trouble the World Bank stepped in and offered
loans as long as they reformed their economies with less public spending, austerity and privatising
previously public companies.
It was a disaster.
In the Asian Crisis in 1998 the IMF stepped in and offered loans as long as they reformed their
economies with less public spending, austerity and privatising previously public companies.
It was a disaster.
When Greece got into trouble recently the IMF stepped in and offered loans as long as they
reformed their economy with less public spending, austerity and privatising previously public
companies.
The US and the UK were the first to adopt these ideas with Reagan and Thatcher.
One idea was to make countries competitive in a global economy.
Let's have a look at the US.
The minimum wage must cover the cost of living in that nation, what must the minimum wage cover
in the US?
1) The cost of sky high mortgage payments or rent
2) The repayments on student loans
3) The cost of all services that were once free or subsidised
4) The cost of healthcare
The minimum wage necessary to cover the cost of living in the US ensures it can never compete
with China.
Central Banks were supposed to keep inflation low to ensure the cost of living does not rise
too quickly ensuring wage inflation can be kept low.
The Central Banks produced low inflation figures in the US, while massive inflation was
occurring in the costs of housing, education and healthcare causing the cost of living to sky
rocket. This fictitious inflation figure targeting seems to be a rather pointless exercise. There
is no point in producing low inflation figures while the cost of living is sky rocketing. A global
youth now sit at home with their parents unable to afford to move out due to high mortgage payments
and rent. They are not starting families and the demographic problems are going to get a whole
lot worse. Why is global aggregate demand so low? Suppressed wages with sky rocketing costs of
living. Neo-Liberalism really is just silly.
A look at the UK. We have followed the US idea of paid further education. One of the first
things the US banks did in 2008 was to get the Government to back student loans as they were beginning
to default on a large scale. In the UK we have linked repayments to RPI and not the CPI figure
the Central Bank targets. The usual silliness for masking the rising costs of living and an opportunity
to rip off young people. Another idea, unregulated, trickle down capitalism, which we had in the
UK in the 19th Century. In the 19th Century those at the top were very wealthy those at the bottom
lived in abject poverty, no trickledown. The first regulations to deal with wealthy UK businessman
seeking profit, the abolition of slavery and child labour.
Where regulation is lax today? Factories in China with suicide nets. No wonder the French are
rioting and the populists are getting angry. Neo-Liberalism really is rather nasty.
Michael Hudson in "Killing the Host" goes into the rather more sensible thinking of Classical
Economists on how to make nations competitive. You lower the cost of living to the minimum, to
ensure the basic minimum wage is low enough to compete with other countries.
Pretty much the opposite of the US today:
1) Low housing costs
2) Free or subsidised education
3) Free or subsidised services
4) Free or subsidised healthcare
You need to get the cost of living down, so the minimum wage necessary is the same as that
in China.
If we abolish Free Trade and restore Protectionism, the American minimum wage won't HAVE
to compete with China. Free Trade is the new Slavery. Protectionism is the new Abolition.
"... Yet still we cannot bring ourselves to look the thing in the eyes. We cannot admit that we liberals bear some of the blame for its emergence, for the frustration of the working-class millions, for their blighted cities and their downward spiraling lives. So much easier to scold them for their twisted racist souls, to close our eyes to the obvious reality of which Trump_vs_deep_state is just a crude and ugly expression: that neoliberalism has well and truly failed. ..."
"... The only thing more ludicrous than voting for Donald Trump would be to vote for Hilary Clinton. Whilst Trump is evidently crude, vulgar, bombastic, xenophobic, racist and misogynistic, his manifest personality flaws pale into insignificance when compared to the the meglomaniacal, prevaricating, misandristic, puff adder, who is likely to oppose him! ..."
"... Clinton is the archetypal political parasite, who has spent a lifetime with her arrogant snout wedged firmly in the public trough. Like Obama, Bush, et al, Clinton is just another elitist Bilderberger sock puppet, a conniving conspirator in the venal kleptocracy, located in Washington D.C, otherwise known as the U.S. federal government. ..."
"... Trump at least is not in thrall to the system and thus, by default, can be perceived by the average blue-collar American as being an outsider to the systemic corruption that pervades the whole American political process. A horrible choice, but the lesser of two evils. ..."
"... Trump was always a Democrat, before now and so were a lot of other Americans. America is watching how the Democrat Party is destroying America. The race card is a low blow to Trump supporters. Illegal immigration is a legitimate issue in the US. It has nothing to do with racism. ..."
"... British capitalism grew because of two things cheap coal that made using the new steam engine and the protected monopoly markets offered by the empire which also provided monopoly access to the resources of those countries. American capitalism grew up behind high tariff walls, ditto Chinese capitalism now. ..."
"... TTIP will be used by big capital both here in Europe and in the US to drive down the wages and working conditions of workers in Europe and the US, and that is why the EU is solely a bosses agenda and workers here in Britain have more to gain by leaving the EU, an EU that has crucified workers in Greece just so German bankers don't lose. ..."
"... Politicians in the U.S. are inherently corrupt, both figuratively and literally (they just hide it better as perks and campaign contributions). Politicians in the U.S. make promises, but ultimately it is just rhetoric and nothing ever gets delivered on. Once elected, they revert to the Status Quo of doing nothing – or they vote for the bills of the interest groups that supported them during the election. ..."
"... It seems noone wants to talk about anything other than vilifying Trump supporters because their vested interests are all about grind working people into the dust so the high end of town can make every more money. No wonder Trump is cutting through. The whole world has been watching our leaders sell us down the river in these deals. ..."
"... The working class tens of millions have the votes and if need be, the guns. Thank you, second amendment. Essentially they're presented with the prospect of their kids spending their working lives slaving at $10-$20 an hour, or to die trying to alter the future of that elite-orchestrated course of events. What would an American choose? ..."
"... All Clinton has to offer is more of the same lying and "free trade" deals, and subterfuge and killing. Trump says he's gonna step up, bring the jobs back to America, get the mass of people moving forward again, so Trumps is gonna win this thing. ..."
"... Free trade isn't free. It has cost millions of Americans their jobs, even their homes and hopes for the future. Both parties have taken American workers for granted even worse than the Democrats have taken Blacks for granted lately. ..."
"... What we need is a Labor party to represent those of US who have to work to earn a living, as opposed to those who were born wealthy, or gained their wealth through stock manipulation/dividends and fraud. It is the working people who actually create new wealth. Trump's bigotry does not bother white blue collar workers because they mostly agree and hate and fear Blacks. The Venn diagram of bigots, white laborers and the south overlap almost 100%. ..."
"... Taibbi in the latest Rolling Stone says the same thing. Taibbi went to listen to Trump's speeches. Trump pillories Big Pharma, unemployment and trade deals and Wall Street. He's less warlike than Clinton. ..."
"... So it is very possible Clinton will be hit from the LEFT by Trump. That is how bad the Democratis really are. ..."
"... And 'change' – I.e more globalism, means less and less job security: economic security slipping away at a unprecedented rate. Transnational interests basically rule America, not to mention the mainstream media, whose job it is to attack Trump. Many millions have seen through this facade. Democrat or Republican, the incestuous political establishment is being exposed like never before. ..."
"... Trump is revealing what other candidates refuse to admit: that they are owned before they even step foot into Washington. I mean - Clinton is Goldman and Sachs, TTIP, Monsanto approved! And this is who the Guardian are siding with? Go figure... ..."
"... I think his denouncing trade deals is what made the Republicans, (aka, Corporatist Party of which Hillary should clearly be a part of-but save for another day) go bonkers. They cannot control this guy and he's making sense in the trade department. It's not as if suddenly the Republican party has grown a set of morals. ..."
"... Because Sanders will support Hillary as he promised to do -- does that sound like a revolutionary? Bill Clinton invented NAFTA. Get it? ..."
"... They abandoned the working classes in favour of grabbing middle class votes and relied on working class voters continuing to support them, because they had "nowhere else to go". ..."
"... This reminded me of something I heard on NPR this weekend: Charles Evers, Medgar Evers' brother and a prominent civil rights activist since the 50's, is endorsing Trump. ..."
"... Interestingly you have raised issues that are all very complex -- and that is just the problem. We have become a society that promotes complexity and then does not want to discuss and analyze those complex issues, but wants to oversimplify and fight and make the "other side" be a devil. Are we all getting dumbed down to slogans and cliches? ..."
"... The working people that the party used to care about, Democrats figured, had nowhere else to go, in the famous Clinton-era expression. The party just didn't need to listen to them any longer. ..."
"... Frank offers insights that Clintonites can ignore at their peril. As the widow of a hardworking man who was twice the victim of "outsourcing" to Malaysia and India, and whose prolonged illness brought with it savings-decimating drug costs, I can well see how Trump's appeal goes beyond xenophobia and racism. ..."
"... Trump is saying that NAFTA and neo-liberalism have failed the American people. ..."
"... You could be describing Hillary and Bill the fraudulent guy who "feels your pain". Liars and in the pockets of bankers, that couple is not your friend. ..."
"... I don't see a true value to trade if it involves loss of jobs and lowered pay. I do see value in fair trade where we receive somewhat equal return ..."
"... The Guardian's incessant Trump bashing disguises, unfortunately, how similarly repugnant Cruz(particularly) and Rubio are. Clinton is better, not by far, and Sanders though wonderfully idealist and full of integrity, will be able to accomplish nothing with the Republicans controlling Congress. ..."
"... I'm living in Japan, where in the past decade they have taken in 11 refugees. That's not 11 million or even 11 thousand. I mean 11. ..."
"... And guess what, they are not racist. They have borders and they are not racist. I know this is a hard concept for progressives to get their heads around, but believe it or not it is possible. ..."
"... The Guardian's incessant Trump bashing disguises, unfortunately, how similarly repugnant Cruz(particularly) and Rubio are. Clinton is better, not by far, and Sanders though wonderfully idealist and full of integrity, will be able to accomplish nothing with the Republicans controlling Congress. ..."
...the Republican frontrunner is hammering home a powerful message about free trade and its victims
....because the working-class white people who make up the bulk of Trump's fan base show up in
amazing numbers for the candidate, filling stadiums and airport hangars, but their views, by and
large, do not appear in our prestige newspapers. On their opinion pages, these publications take
care to represent demographic categories of nearly every kind, but "blue-collar" is one they persistently
overlook. The views of working-class people are so foreign to that universe that when New York Times
columnist Nick Kristof wanted to "engage" a Trump supporter last week, he made one up, along with
this imaginary person's responses to his questions.
When members of the professional class wish to understand the working-class Other, they traditionally
consult experts on the subject. And when these authorities are asked to explain the Trump movement,
they always seem to zero in on one main accusation: bigotry. Only racism, they tell us, is capable
of powering a movement like Trump's, which is blowing through the inherited structure of the Republican
party like a tornado through a cluster of McMansions.
... ... ...
Yes, Donald Trump talked about trade. In fact, to judge by how much time he spent talking about
it, trade may be his single biggest concern – not white supremacy. Not even his plan to build a wall
along the Mexican border, the issue that first won him political fame. He did it again during the
debate on 3 March: asked about his
political excommunication by Mitt Romney, he chose to pivot and talk about ... trade.
It seems to obsess him: the destructive free-trade deals our leaders have made, the many companies
that have moved their production facilities to other lands, the phone calls he will make to those
companies' CEOs in order to threaten them with steep tariffs unless they move back to the US.
Trump embellished this vision with another favorite left-wing idea: under his leadership, the
government would "start competitive bidding in the drug industry." ("We don't competitively bid!"
he marveled – another true fact, a
legendary boondoggle brought to you by the George W Bush administration.) Trump extended the
critique to the military-industrial complex, describing how the government is forced to buy
lousy but expensive airplanes thanks to the power of industry lobbyists.
... ... ...
Trade is an issue that polarizes Americans by socio-economic status. To the professional class,
which encompasses the vast majority of our media figures, economists, Washington officials and Democratic
power brokers, what they call "free trade" is something so obviously good and noble it doesn't require
explanation or inquiry or even thought. Republican and Democratic leaders alike agree on this, and
no amount of facts can move them from their Econ 101 dream.
To the remaining 80 or 90% of America, trade means something very different. There's a video going
around on the internet these days that shows a room full of workers at a Carrier air conditioning
plant in Indiana being told by an officer of the company that the factory is being moved to Monterrey,
Mexico and that they're all going to lose their jobs.
As I watched it, I thought of all the arguments over trade that we've had in this country since
the early 1990s, all the sweet words from our economists about the scientifically proven benevolence
of free trade, all the ways in which our newspapers mock people who say that treaties like the North
Atlantic Free Trade Agreement allow companies to move jobs to Mexico.
Well, here is a video of a company moving its jobs to Mexico, courtesy of Nafta. This is what
it looks like. The Carrier executive talks in that familiar and highly professional HR language about
the need to "stay competitive" and "the extremely price-sensitive marketplace." A worker shouts "Fuck
you!" at the executive. The executive asks people to please be quiet so he can "share" his "information".
His information about all of them losing their jobs.
But there is another way to interpret the Trump phenomenon. A map of his support may coordinate
with racist Google searches, but it coordinates even better with deindustrialization and despair,
with the zones of economic misery that 30 years of Washington's free-market consensus have brought
the rest of America.
Advertisement
It is worth noting that Trump is making a point of assailing that Indiana air conditioning company
from the video in his speeches. What this suggests is that he's telling a tale as much about economic
outrage as it is tale of racism on the march. Many of Trump's followers are bigots, no doubt, but
many more are probably excited by the prospect of a president who seems to mean it when he denounces
our trade agreements and promises to bring the hammer down on the CEO that fired you and wrecked
your town, unlike Barack Obama and Hillary Clinton.
Here is the most salient supporting fact: when people talk to white, working-class Trump supporters,
instead of simply imagining what they might say, they find that what most concerns these people is
the economy and their place in it. I am referring to a study just published by Working America, a
political-action auxiliary of the AFL-CIO, which interviewed some 1,600 white working-class voters
in the suburbs of Cleveland and Pittsburgh in December and January.
Support for Donald Trump, the group found, ran strong among these people, even among self-identified
Democrats, but not because they are all pining for a racist in the White House. Their favorite aspect
of Trump was his "attitude," the blunt and forthright way he talks. As far as issues are concerned,
"immigration" placed third among the matters such voters care about, far behind their number one
concern: "good jobs / the economy."
"People are much more frightened than they are bigoted," is how the findings were described to
me by Karen Nussbaum, the executive director of Working America. The survey "confirmed what we heard
all the time: people are fed up, people are hurting, they are very distressed about the fact that
their kids don't have a future" and that "there still hasn't been a recovery from the recession,
that every family still suffers from it in one way or another."
Tom Lewandowski, the president of the Northeast Indiana Central Labor Council in Fort Wayne, puts
it even more bluntly when I asked him about working-class Trump fans. "These people aren't racist,
not any more than anybody else is," he says of Trump supporters he knows. "When Trump talks about
trade, we think about the Clinton administration, first with Nafta and then with [Permanent Normal
Trade Relations] China, and here in Northeast Indiana, we hemorrhaged jobs."
"They look at that, and here's Trump talking about trade, in a ham-handed way, but at least he's
representing emotionally. We've had all the political establishment standing behind every trade deal,
and we endorsed some of these people, and then we've had to fight them to get them to represent us."
Now, let us stop and smell the perversity. Left parties the world over were founded to advance
the fortunes of working people. But our left party in America – one of our two monopoly parties –
chose long ago to turn its back on these people's concerns, making itself instead into the tribune
of the enlightened professional class, a "creative class" that makes innovative things like derivative
securities and smartphone apps. The working people that the party used to care about, Democrats figured,
had nowhere else to go, in the famous Clinton-era expression. The party just didn't need to listen
to them any longer.
What Lewandowski and Nussbaum are saying, then, should be obvious to anyone who's dipped a toe
outside the prosperous enclaves on the two coasts. Ill-considered trade deals and generous bank bailouts
and guaranteed profits for insurance companies but no recovery for average people, ever – these policies
have taken their toll. As Trump says, "we have rebuilt China and yet our country is falling apart.
Our infrastructure is falling apart. . . . Our airports are, like, Third World."
Trump's words articulate the populist backlash against [neo]liberalism that has been building
slowly for decades and may very well occupy the White House itself, whereupon the entire world will
be required to take seriously its demented ideas.
Yet still we cannot bring ourselves to look the thing in the eyes. We cannot admit that we
liberals bear some of the blame for its emergence, for the frustration of the working-class millions,
for their blighted cities and their downward spiraling lives. So much easier to scold them for their
twisted racist souls, to close our eyes to the obvious reality of which Trump_vs_deep_state is just a crude
and ugly expression: that neoliberalism has well and truly failed.
Below is a letter that General Jonathan Wainwright sent to Soldiers discharged from the military,
following their service in World War II. As our military downsizes and many choose to leave the
service, I think this letter reminds us of the charge to continue to reflect the values of our
individual services and be examples within our communities.
To: All Personnel being Discharged from the Army of the United States.
You are being discharged from the Army today- from your Army. It is your Army because your
skill, patriotism, labor, courage and devotion have been some of the factors which make it
great. You have been a member of the finest military team in history. You have accomplished
miracles in battle and supply. Your country is proud of you and you have every right to be
proud of yourselves.
You have seen, in the lands where you worked and fought and where many of your comrades
died, what happens when the people of a nation lose interest in their government. You have
seen what happens when they follow false leaders. You have seen what happens when a nation
accepts hate and intolerance.
We are all determined that what happened in Europe and in Asia must not happen to our country.
Back in civilian life you will find that your generation will be called upon to guide our country's
destiny. Opportunity for leadership is yours. The responsibility is yours. The nation which
depended on your courage and stamina to protect it from its enemies now expects you as individuals
to claim your right to leadership, a right you earned honorably and which is well deserved.
Start being a leader as soon as you put on your civilian clothes. If you see intolerance
and hate, speak out against them. Make your individual voices heard, not for selfish things,
but for honor and decency among men, for the rights of all people.
Remember too, that No American can afford to be disinterested in any part of his government,
whether it is county, city, state or nation.
Choose your leaders wisely- that is the way to keep ours the country for which you fought.
Make sure that those leaders are determined to maintain peace throughout the world. You know
what war is. You know that we must not have another. As individuals you can prevent it if you
give to the task which lies ahead the same spirit which you displayed in uniform.
Accept and trust the challenge which it carries. I know that the people of American are
counting on you. I know that you will not let them down.
Goodbye to each an every one of you and to each and every one of you, good luck!
J.M. WAINWRIGHT
General, U.S. Army
Commanding
Albert Matchett
Why Americans are supporting him begins to make sense. A lot like here in the UK, our politicians
have reduced amount of money that people have available to spent And can not understand why sales
turnovers keeps going down.
No money, No sale. Companies say made abroad equals higher profits but Not if the goods made
can not be sold, Because we have to many unemployed or minimum hours contracts or low income people.
matt88008
The only thing more ludicrous than voting for Donald Trump would be to vote for Hilary
Clinton. Whilst Trump is evidently crude, vulgar, bombastic, xenophobic, racist and misogynistic,
his manifest personality flaws pale into insignificance when compared to the the meglomaniacal,
prevaricating, misandristic, puff adder, who is likely to oppose him!
Clinton is the archetypal political parasite, who has spent a lifetime with her arrogant
snout wedged firmly in the public trough. Like Obama, Bush, et al, Clinton is just another elitist
Bilderberger sock puppet, a conniving conspirator in the venal kleptocracy, located in Washington
D.C, otherwise known as the U.S. federal government.
Trump at least is not in thrall to the system and thus, by default, can be perceived by
the average blue-collar American as being an outsider to the systemic corruption that pervades
the whole American political process. A horrible choice, but the lesser of two evils.
Trump was always a Democrat, before now and so were a lot of other Americans. America is watching
how the Democrat Party is destroying America. The race card is a low blow to Trump supporters.
Illegal immigration is a legitimate issue in the US. It has nothing to do with racism.
Protecting America from potential terrorists entering the county is a real issue. We can look
what happened in Paris and Cologne. These are concerns of the people of America and they want
protection and solutions. It has nothing to do with racism.
The biggest reason people support Trump is because they trust his financial aptitude. They
honestly feel he can bring America back to greatness.
I personally don't care for his personality and don't completely trust him but I may have to
vote for him, considering my other choices. As soon as Rubio and Kasich drop out, Cruz will take
off. Rubio, if he truly hates Trump, as he acts, may want to drop out sooner than later.
British capitalism grew because of two things cheap coal that made using the new steam engine
and the protected monopoly markets offered by the empire which also provided monopoly access to
the resources of those countries. American capitalism grew up behind high tariff walls, ditto
Chinese capitalism now.
British capitalism went into relative decline from the mid nineteenth century because of the
opening up those monopoly markets to overseas competition.
TTIP will be used by big capital both here in Europe and in the US to drive down the wages
and working conditions of workers in Europe and the US, and that is why the EU is solely a bosses
agenda and workers here in Britain have more to gain by leaving the EU, an EU that has crucified
workers in Greece just so German bankers don't lose.
If the soft left and that includes much of what passes for the left in the PLP continues to
pander to the interests of big capital then the working classes will continue to be alienated
from the Labour party.
To the middle class soft left choose a side, there are only two, labour or capital
. If you choose capital you personally maybe ok for a while, but capitalist expansion is now
threatening the environment and with it food and water security. Capitalism rests on continuous
expansion but is now pushing against natural limits and when capitalist states come under too
many restrictions to their expansion you have the perfect recipe for war and in 2016 a war between
the largest capitalist states has the risk of going nuclear.
I'll just bet that if you were to look a little closer, you might find that there are a lot of
different races voting for Trump, so stop trying to brand him as racist. That is just another
trick the opposition wants you to fall for. The corporations are fearful that they might have
to actually give a high paying job to an American, tsk, tsk.
It's ironic that a billionaire is leading the inter-class revolution.
I don't completely buy into the premise (last paragraph) that most liberals are well educated
and well off and that it's liberals -- speaking of the electorate -- that have turned their backs
on blue collar workers. There are many working-class Democrats -- that's part of Bernie Sanders'
base, the youth of America is very liberal and very under-employed, non-Evangelical Black people
tend to vote liberal/Democrat -- at least according to the GOP, the Clinton campaign & the polls
-- so to state that it's liberals who've turned their backs on the blue collar class is folly.
Now, the statement that liberal politicians have turned their backs on their working-class
base, as well as the working-class Republicans, is very true, and that's a result of too much
money in politics. Pandering to lobbyists while ignoring the electorate.
What I don't understand about the liberal electorate is why so freakin' many low-income voters
choose Hillary Clinton over Bernie Sanders. Why so many, supposed, educated people (at least smarter
than the rank-&-file Republican voter, goes the legend) would vote against their best interests
and support a lying, flip-flopping, war-mongering, say-anything-get-elected, establishment crony
is beyond comprehension.
If it comes down to it, at least with Trump you know where his money came from. How, exactly,
is it that the Clintons went from being broke as hell after leaving the White House to having
a net worth of over $111M in just 16 years? Since Slick Willy left office, except for the past
four years, hasn't Hillary always been a government employee? Except, you know, when she's campaigning.
She's worth $35M, herself, is there that much money in selling books? If not, then she got paid
-- bribed -- quite handsomely to speak at private functions.
Both Clintons exemplify Democratic politicians who've utterly ignored the working class while
pander to and serving only the executive class of America. Ronald Reagan would be proud of both
Bill and Hillary Clinton's devotion to the 'trickle down' theory of economics.
One thing that's important to consider, too, is how voting for politicians who claim to have
your back on wedge issues is really shooting yourself in the foot economically. Wedge issues are
the crumbs the Establishment allows the electorate to feast on while they (the Establishment)
rob the Treasury blind, have their crimes decriminalized, start wars to profiteer from, write
policy, off-shore jobs, suppress wedges, evade taxes, degrade the environment, monopolize markets,
bankrupt emerging markets, and generally hoard all the economic growth for themselves.
Friends don't let friends vote for neo-liberalists!
Politicians in the U.S. are inherently corrupt, both figuratively and literally (they just
hide it better as perks and campaign contributions). Politicians in the U.S. make promises, but
ultimately it is just rhetoric and nothing ever gets delivered on. Once elected, they revert to
the Status Quo of doing nothing – or they vote for the bills of the interest groups that supported
them during the election.
As far as racism is concerned, why is it racist to want to send undocumented people out of
a country that they entered illegally in the first place?
This seems to be the general accusation levied against Europeans and Americans (i.e. whites).
We seem to have the obligation to take in refugees from all over the world otherwise we are seen
as racists. Yet, I see no effort by the Gulf States, Saudi or any other Muslim country taking
some of the Syrians. This would make a lot more sense since they have the commonality of language,
religion and culture. But nobody deems them to be racists.
What a brilliant article. It seems noone wants to talk about anything other than vilifying
Trump supporters because their vested interests are all about grind working people into the dust
so the high end of town can make every more money. No wonder Trump is cutting through. The whole
world has been watching our leaders sell us down the river in these deals.
This is probably the first article I've read that gives a clear-eyed account of exactly why Trump
is gaining so much support. More of this and less of the sneery pieces would be much more enlightening
to those of us who have been baffled by his continuing success.
People had the opportunity to elect Ross Perot who focused on Trade without using racism, back
in 92. Perot, also a billionaire predicted all the catastrophic impact due to free trade and kept
warning everybody. The majority decided otherwise...
Correct! Even Obama won't use the words "working class"...they are now ' dirty words'.. The working
class are fed up being ignored, patronized, lied to, and manipulated with words by politicians
in both the US and Australia.
Politicians think that all they have to do is 'look good' and say the right thing. Then wait
a bit, change the words and continue to manipulate things from backrooms.
Trump doesn't do that-and that is why people are voting for him...
However, if he got into power he would have to do exactly the same as the others to survive
The working class tens of millions have the votes and if need be, the guns. Thank you, second
amendment. Essentially they're presented with the prospect of their kids spending their working
lives slaving at $10-$20 an hour, or to die trying to alter the future of that elite-orchestrated
course of events. What would an American choose?
The Guardian openly abuses blue collar workers on a daily basis and is at a loss to understand
why they can't connect with them. This is another non-story.
All Clinton has to offer is more of the same lying and "free trade" deals, and subterfuge
and killing. Trump says he's gonna step up, bring the jobs back to America, get the mass of people
moving forward again, so Trumps is gonna win this thing.
Almost all of Trump's proposals, as well as those of other candidates, cannot be implemented without
the concurrence of Congress. Tariffs must pass both houses, while ratification of treaties requires
a 2/3 supermajority in the Senate. A question for each of the so-called debates ought to concern
how each candidate intends to convince congress to pass his/her most contentious proposal.
Trump is awful but he taps into passion, fear and real concerns. If these corrupt phony political
parties can't help real people then this is what we get -- Trump, Hillary Clinton and fake revolutionary
Bernie Sanders who promised to support the evil Clinton when she wins the rigged nomination. Trump
is no worse than the other fake chumps pretending to be our friends.
"We liberals..." You disgust me. While you defend Trumps supporters as not entirely consumed with
racism as much as fear, as people who actually may have interests in the economy and in trade,
as workers who, just maybe, SHOULD have the right to work in an airconditioning factory that ISN'T
in Mexico, or China, or Indonesia.... while you defend these not-really-not-totally-racist working
class people you excoriate them and continue on your merry little way trashing Trump. Staying
safe, staying disgusted with the man, and walking the Party Line like a good little establishment
"liberal." The true liberal doesn't exist anymore. Your article sucks. If anyone other than Crass
Mr. Trump gets elected to the presidency of this country we will continue down the same road of
useless wars for the MIC and Banking Scum, the 1%, whatever you wish to call them and it will
be more painful than it is now. Because what's really important is the correct opinion on everything.
Not that things change radically and that the working classes of all colors and creeds begin to
see some fair shakes, which would happen under Trump.
I happen to know someone who worked in his company, who didn't even know the man but was on his
payroll. It got around to him that this employee had exhausted his health benefits with the company
he chose (he had leukemia) and he was hitting up other employees for money to pay his cancer care
bills so he could continue treatment. Trump got word of this and didn't even know this person
only that he worked for his company - and sent word to the hospital that he guaranteed payment
and that the hospital should take care of him as well as possible and he would be responsible.
He told the family to keep it a secret, but of course a few people got wind of it. THAT is exactly
the opposite of what Mr. Clean Romney did letting an employee drop dead for lack of health insurance,
but he'd be SUCH a better president, sooooo caring. Trump is the only one who isn't bought and
paid for on the Hill of Vipers and that's what attracts us racist, white, gun-toting, immigrant-hating,
blah blah blah fill-in-the-blanks-you-liberal-twit people towards Trump. And those pulling out
all the stops to "Stop Trump" are just making it more clear than ever that the presidency is and
has been hand picked and cleared as willing to dance on the puppeteer's strings and do the insiders
and oligarchy's bidding.
Thomas Frank is often right, but not this time. If working class white Americans of a certain
type wanted to support a candidate who is against all this neo-liberal free-trade nonsense, they
could easily support Bernie Sanders. He's an outsider like Trump as far as the American political
class goes, but has actually done good things as a Senator and stands up for workers. It's interesting
that it's not just NAFTA and job losses that these Trump supporters are interested in, it's the
xenophobia as well, the anti-Muslim hysteria, and the thuggish behavior of beating down protesters
at the Trump rallies. Frank just can't blame the media class for all that...it exists and happens
and Trump fans the flames. Trump could care LESS about working class Americans, he cares ONLY
about himself - the classic demagogue.
Free trade has undoubted winners and losers, but historically attempts to 'protect' or 'control'
a nation's economy have ended badly in stagnation and political authoritarianism. Obvious case
in point, the Soviet Union in the latter half of the twentieth century. Conversely opening up
the economy to competition seems to do exactly the opposite, eg the Chinese 'economic miracle'.
A controlled economy might count as 'left-wing' but its the kind of example of Socialism gone
bad that socialists feel embarrassed about.
As for racism, its not hard to pick up the racist signals from Trump, genuine or not, so anyone
supporting him has a nose-holding ability which those with moral sensibilities will find difficult.
Perhaps 'he/she's a racist but ...' is not such an uncommon stance, yet when it comes to the head
of state, its that much harder to turn a blind eye. Of course lots of Germans did it very successfully
in the 1930s and 40s.
Bullshit. Europe is doing better than both America and China. Free trade plus corruption does
not equal prosperity. A little less "free trade" and a little less corrupt elites goes a long
way towards prosperity.
Free trade isn't free. It has cost millions of Americans their jobs, even their homes and
hopes for the future. Both parties have taken American workers for granted even worse than the
Democrats have taken Blacks for granted lately.
The Republicans have kept most blue collar laborers in their party because they appeal to their
bigotry and their religious snobbery. Republicans have made few offers to even attempts to help
US because they don't have to and they don't want to.
Current Democrats are almost as bad, but at least they have a past track record of helping
create a vibrant middle class.
What we need is a Labor party to represent those of US who have to work to earn a living,
as opposed to those who were born wealthy, or gained their wealth through stock manipulation/dividends
and fraud. It is the working people who actually create new wealth. Trump's bigotry does not bother
white blue collar workers because they mostly agree and hate and fear Blacks. The Venn diagram
of bigots, white laborers and the south overlap almost 100%.
I believe the KISS principle is popular in America, is that why things go so well for Trump?
Have I applied the KISS principle Keep It Simple, Stupid. Don't be afraid to ask questions,
relax yourself and all else by calling yourself a simple, stupid, snail; I'll try to get there,
but you'll have to be pedagogic and it will take enough time, preferably I want to sleep a night
on the matter (sound judgement depends (but not only necessary but not sufficient) on considering
and weighing the significantly complete set of related aspects, and this complete set may take
considerable time to bring to the table another tip; in strong or new intellectual or emotional
states keep calm and imagine filter words with your palms covering your ears). Prestige and vanity
of own relative worth can be very expensive. If you do a wrong, more or less, try to neutralize
the wrong, rather than have the prestigious attitude that direct or implied admittance of wrong
is hurting your vain surface, since with accountability and a degree of transparency will ultimately
have consequences of the wrong, and by not swiftly correcting them you are accountable for this
reluctance too.
Part of the KISS principle is to remind you of assumptions, explicit and emotional, as well
as remind you of what's hidden. To be aware of what you do not know is a way of making emotional
assumptions explicit which help in explicit risk assessment. An emotional assumption such as "everything
feels fine" can turn into "I assume there is no hidden nearby hostile crocodiles in the Zambezi
river we're about to pass into."
So Trump's success is all about trade imbalance and its negative impact on the American working
class, which the author perceives as predominantly white. This is far from the truth: many if
not most workers in agricultural, custodial, fast food, landscaping, road maintenance...are Africa-American,
Hispanics, or undocumented workers.
Does Trump also speak for those people who work in jobs that have been turned down by the white
working class? Would he stand up for them by, for example, calling to raise the minimum wage to
$14 an hour?
Taibbi in the latest Rolling Stone says the same thing. Taibbi went to listen to Trump's speeches.
Trump pillories Big Pharma, unemployment and trade deals and Wall Street. He's less warlike than
Clinton.
So it is very possible Clinton will be hit from the LEFT by Trump. That is how bad the
Democratis really are.
And blah blah blah... Actually, Trump's is a very optimistic picture of the USA.
And 'change' – I.e more globalism, means less and less job security: economic security
slipping away at a unprecedented rate. Transnational interests basically rule America, not to
mention the mainstream media, whose job it is to attack Trump. Many millions have seen through
this facade. Democrat or Republican, the incestuous political establishment is being exposed like
never before.
Trump is revealing what other candidates refuse to admit: that they are owned before they
even step foot into Washington. I mean - Clinton is Goldman and Sachs, TTIP, Monsanto approved!
And this is who the Guardian are siding with? Go figure...
I think his denouncing trade deals is what made the Republicans, (aka, Corporatist Party of
which Hillary should clearly be a part of-but save for another day) go bonkers. They cannot control
this guy and he's making sense in the trade department. It's not as if suddenly the Republican
party has grown a set of morals.
The question of course is how serious is he? Is he true or co-opting Bernie's message? One
thing's for certain, he's against increasing the minimum wage.
"But, taxes too high, wages too high, we're not going to be able to compete against the
world. I hate to say it, but we have to leave it the way it is," he told debate moderator Neil
Cavuto when asked if he would raise wages. "People have to go out, they have to work really
hard and have to get into that upper stratum. But we cannot do this if we are going to compete
with the rest of the world. We just can't do it." Politico, 11/12/15
Brilliant, brilliant column! I will add, because no one else calls him on these things, that Obama
is still pushing TPP, has increased the number of H1B Visa holders in the US, and is now giving
the spouses of H1B Visa holders the right to work, meaning they, too can take a job that might
have gone to a US citizen, and Obama has essentially cut the retirement benefits working class
seniors have paid for all their lives. Yet no one calls him on these things, except Trump.
Where did this general theme of insulting voters come from? Calling Trump supporters racists idiots
is no way to win their votes. You can not win an election by being an insulting troller.
The same people who attack Trump engage in even worse behavior. No wonder Trump will win the
election.
What is your take on free trade? What is your take on protectionism? Well the real question
is "What is best for our country?" Work, services and manufacturing of goods, is a dynamic thing.
At some times there is lots of work for most people, at some times hardly any work is available.
The amount of work available is a factor of 3 things, 1. Initiatives to work. 2. Financing
of these initiatives. 3 Law and order. Either individuals start their own business through an
initiative and if people with money believe in that individual and initiative they get financed
as long as there is law and order so that the financing gives a return of investment. Or existing
business start their own initiatives with their own money, investors' money or loans.
When people sit on their money out of fear, lack of quality initiatives or qualified abilities,
the economy hurts and people are going to be out of work. It works like a downward spiral, when
people have no income, they cannot buy services and goods, and the business can therefore not
sell, more people lose their jobs, less people buy and so on.
On the other hand, if people are hired, more people get money and purchase things from businesses,
demand increases, businesses hire more people to meet demand, more people get money, and purchase
more things from the businesses. The economy goes in a thriving upward spiral.
What about trade between nations? Well as you have understood, there is a dynamic component
of the economy of a nation. There is an infrastructure, not only roads, electric grids, water
and sewage piping, but a business infrastructure. Institutions such as schools, universities,
private companies providing education to train the workforce. A network of companies that provide
tools, knowledge, material, so that a boss simply can purchase a turn-key solution from the market,
after minimal organising, after the financing has been made. These turn-key solutions to provide
goods and services to the market and thus make money for the initiative makers and provide both
jobs and functions as an equalising of resources. Equalising if the initiative makers take patents,
keep business secrets and have abilities that are more competitive than the rich AND do not sell
their money-making opportunity to the rich but fight in the market.
In other words, if you sit on a good initiative and notice you are expanding in the market
(and thus other players are declining in their market share, including the rich), don't be stupid.
Now a hostile nation to your nation, knows about this infrastructure. This infrastructure takes
time to build up. One way to fight nations is to destroy their infrastructure by outcompeting
them with low prices. All businesses in a sector is out-sourced. But the thing is, if a nation
tries to do this, and if you have floating currencies (and thus you have your own currency, which
is very important to a nation), your own currency will fall in relative value. (e.g. businesses
in China gets dollars for sold goods to USA, sell them (the dollars they got) and buy yuan (the
currency in China), this increased sell pressure will cause the dollar to drop in value) If you
import more than you export. Therefore your nation's business will have an easier time to sell
and export. Thus there is a natural balance.
But, if your nation borrows money from the hostile nation, then this correction of currency
value will not occur. The difference in export and import will be balanced by borrowing money
and the currency value will stay the same.
Thus all your manufacturing businesses and thus the infrastructure can be destroyed within
a nation because of imports are more than exports and the nation borrows money.
Then when the nation is weak and dependent on the industry of the hostile nation a decisive
stab in can occur and your nation will be destroyed and taken over by the hostile nation.
Free trade naturally includes the purchasing of land and property. Thus while we exchange perishable
goods for hard land and property, there is a slow over taking of the nation's long term resources,
all masked off under the parole of free trade. Like a drug addict we crave for the easy way out
buying cheap perishable goods while the land is taken over by foreign owners protected by our
own ownership laws. The only way out of this is replacing free trade with regulated trade. In
our nation's own interest.
Thus free trade can be very destructive. It really is a wolf in sheep's clothing.
Trump is a disruptor -- and this moribund political economic system deserves disruption. The feeble
Democrats could only come up with Sanders (who cringingly promised to support Hillary once she
overwhelms him in the rigged system) is not in the same class. Bigoted clown in some ways he expresses
the anger millions feel. Get used to it.
Im sorry. No matter how smart you like to appear when you commenting on the Guardian after saying
things like "Trump is far and away the smartest, brainiest, most intelligent candidate running
on either side" how can anyone take your views serious?
Yeah maybe not all voters are racists. Sure. But most of them still are. Most Trump voters
are also extremely uneducated, ignorant and filled with right wing media false fact anger. "To
make America great again" I have never laughed so hard in my life before. America isn't in bad
shape right now. There are always problems but building a wall (which is hysterical) to save us
from immigrants for example is just plain crazy.
Trump of course inserts real issues like Veterans. Trade. Ok. Its easy to say one thing but
when you look at his past, he's ruined various businesses and is currently under investigation
for fraud.
To say that that DT is smart is crazy. The guy cannot articulate anything to save his life
and when you look at how protesters get (mis)handled at his rallies how can you even come on here
and say the things you do. YOu should be ashamed of yourself. But sure have a President that's
ignoring Climate change and you will see where Florida will be in a few years. Ironically they
vote for Trump so the joke in the end will be on them.
This article may have some good points but still, Donald Trump is nothing more but
an opportunist. He doesn't really give a shit about you, the little white class. He's not intelligent
or even capable to LEAD a country like ours. Europe is laughing at us already. The circus was
fun for a while but I think its time to get realistic and stop this monkey show for good.
Trump/Cruz are monsters who have plans for the take-over of the US. Trump will be like his friend
Carl Icahn. He will take all he can in profit. Sell off parts cheap off-shore. Ignore the ex-workers
living under a bridge. Cruz the Domionionist Evangelical will say Armageddon is in the Bible as
he creates it in the Middle East. Neither man should be running for President, but the system
has been captured by the likes of Rupert Murdoch who is drilling for oil in Syria with his friends
Cheney and the Rothschilds. The Koch Brothers Father set up the John Birch Society. Jeb Bush from
a family of many generations who supported Hitler too. We are seeing the bad karma of the West
in bright lights including the poor whites who thought being a white male meant something. They
flock to any help they think they can get from the master-con-man Trump or the Bible man Cruz.
Yes. The US was systematically gutted by people like Romney and friends who made fortunes for
themselves. One of Trump's best friends, Carl Icahn, the hostile take-over artist, knows exactly
how the game is run. It begins by doing and saying anything to get control. Americans are now
chum for the sharks and they know it. Following a cheap imitation of Hitler is not the answer.
Nor is the Evangelical Armageddon Cruz promised his Father.
What this article fails to understand is that racism was always an essential feature of Reaganomics.
Reagan told the mostly poorer white voters of the south and midwest to vote tax cuts for the 1%
on the theory this would increase general prosperity. When that prosperity failed to materialize,
the Republicans always blamed minorities: welfare queens, mexican rapists, etc. Racism was essentially
a feature of their economic model.
Now look at Trump's economic model. It's a neoliberal's dream. He doesn't have a meaningful
critique of the system - that's Bernie Sanders. Instead, Trump picks fights with the Chinese and
Mexicans, to further stoke the racism of his base under the guise of an economic critique. That's
just more of the same. It's what Republicans have been doing for three decades.
The only way in which any of this is new is that Trump fronts the racism instead of hiding
it. That has less to do with Trump than with the slightly deranged mindset of white Republicans
after 7 years of a black President. You think it's a coincidence these people are lining up for
King Birther?
Sorry, Thomas Frank - this is all about race. There are many flavors of neoliberal critique;
Trump has chosen the most flagrantly racist one. His entire appeal begins and largely ends with
race. It's the RACISM, stupid. That and little else.
You don't know what you are talking about. You are the one who is stupid. Obama is pushing bills
that destroy US jobs. Maybe you don't depend on a paycheck to live, but millions of people do.
Too bad you are so removed from reality that you can't empathize.
'Neoliberalism' is a tired cliche , a revanchist term designed to help pseudo-intellectual millenials
sound and feel quasi-intelligent about themselves as they grope, blindly towards a worldview they
feel safe about endorsing.
One must also look at the anti-Trump brigade to find many of his audience. Below in no particular
order are major reasons why he has millions of supporters.
The Anti-Trump Brigade
GOP
Tea Party
Politicians, elected officials in DC all parties.
DC media from TV to internet
Romney, Gingrich, Scarborough, Beck and other assorted losers.
One thing in common they all have very high negatives, particularly the politicians and media
outlets.
Yes! I got on the Trump train after seeing Fox News CEO Ailes' horrible press release insulting
Trump the day before Fox News was to moderate a GOP debate.
The lack of journalistic ethics was so egregious... and then when not one other media outlet
called Fox on their bullshit, not even NPR... I said hey, it is essential to democracy to treat
candidates fairly. they are not treating him fairly! The media hates democracy!?
Good article focusing in on what should really concern us - trade. In particular our inability
to make goods rather than provide services. This is one of the reasons for the slide in lower
middle class lifestyles which is fueling support for Trump
Protectionism can be very destructive. Japan forced Detroit to improve the quality of its cars.
Before Toyota and Honda did it, why would GM and Ford want to make a car that lasted 200,000 miles?
Cheap foreign labor was only one of the reasons for the decline of US manufacturing.
Redonfire,
When I tell one of my sons that globalisation has shafted the european working an d middle class,
he says" yes, but what about its creation of a Chinese and Indian middle class"
I reply that I care as much about them as they care about me.
And "service industry" jobs are also being offshored to call centers and the like. When was the
last time you heard a US accent when you called tech support or any other call center?
because ultimately, I feel based upon listening to my family members who are working class white
folks, they feel that Bernie is a communist, not a socialist, and they don't trust that (or likely
really know the difference). So unfortunately for Da Bern, he will never be able to attract most
of these votes, even though he and The great Hair have (in general) some of the same policies.
The real question is why will the left not turn to the Hair, and get 70% of what they want, having
to listen to bragado and Trump_vs_deep_states as the trade off?
He wants to deport millions upon millions of undocumented immigrants.
I have to say this doesn't seem wildly outrageous - many of them will be working in the black
economy, and helping to further undercut wages in the US. Actually seems quite reasonable. Trump
is still a buffoon, but why throw this at him, when there is soo much else to go at?
The weakness of Labour under Blair has caused the same problems. They abandoned the working
classes in favour of grabbing middle class votes and relied on working class voters continuing
to support them, because they had "nowhere else to go". It worked for "New Labour" for a
while, then us peasants got fed up with the Hampstead Set running the show for their own class
and we started voting UKIP or, as in my case, despairing and not voting at all.
Thank God Jeremy Corbyn has put Labour back on track & pushed the snobbish elements of the
people's party back to the margins!
This reminded me of something I heard on NPR this weekend: Charles Evers, Medgar Evers' brother
and a prominent civil rights activist since the 50's, is endorsing Trump.
The reason is because the media and most of the people are involved in character debates about
him and that's just a game. You support "your guy" and try to denigrate "their guy". It's a game
of insults and no-one ever won an argument by insulting their opponent.
Trump policies show that he wants a trade war, that he wants to build a wall, which will do
little or nothing, at great cost, and he wants to exclude Muslims, when Americans have experienced
more attacks from Christian Terrorists, and American civilians are still 25 times more likely
to die falling out of bed than in a terrorist attack.
He wants to abolish corporate tax entirely, without saying where the money will come from
instead (that means you).
He wants to cut spending on education. But hasn't said if that's because he wants someone
else to do the job, or because he wants a stupid electorate. The Federal Government spends
1.3% of it's budget on education - how much can actually be saved and doesn't the 4.3% spent
on national debt interest indicate somewhere where more can be saved ?
He opposes democracy in the Middle East & prefers the stability of dictators (despite the
chaos that existed in the US, right after independence).
He wants more sanctions on Iran - proving his detachment from reality. The Iran nuclear
deal was pragmatic. It was agreed when we knew Russia, China and India were preparing to lift
their own sanctions, leaving the world with no real leverage to get a better deal.
He supports gun rights, saying they save lives, even though more people die from accidental
shootings, than are saved when used defensively. I am a gun owner in favor of more gun control,
because I want to see the balance shifted to give law-abiding citizens a greater advantage
over criminals. (at this point, the gun nuts jump in saying "criminals don't obey the law".
Yes they do when in jail. If we abolished any law that was ever broken....we would have NO
LAWS).
He wants fewer vaccinations for children, to avoid the (discredited) problems with autism.
He wants a more isolationist diplomatic approach & more military.
He focuses on the criminal activity of illegal aliens, even though crime rates are lower
in their communities than in the general population.
He doesn't want the minimum wage raised, he wants more minimum wage jobs - even though
people on minimum wage often require state and federal financial assistance, just to live.
Interestingly you have raised issues that are all very complex -- and that is just the problem.
We have become a society that promotes complexity and then does not want to discuss and analyze
those complex issues, but wants to oversimplify and fight and make the "other side" be a devil.
Are we all getting dumbed down to slogans and cliches?
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and who signed the job-crushing NAFTA legislation that allowed companies to move jobs offshore?
Bill Clinton........ the Republican in Democrat clothing.
The working people that the party used to care about, Democrats figured, had nowhere
else to go, in the famous Clinton-era expression. The party just didn't need to listen to them
any longer.
"Neo-Liberalism" was given an impetus push with the waning days of the Carter administration when
de-regulation became a policy.....escalated tremendously during Reagan and the rest is history......participated
in by both major US political parties.
They never looked back and never looked deep into the consequences for the average folk. Famously
said, "You can't put the toothpaste back into the tube", applies to global trade also. The toothpaste
is out of the tube. Any real change will be regressive, brutal and probably bring about more wars
around the globe.
What has to change and can is the political attitude of the upcoming political leaders and
the publics willingness to focus more on what a, "progressive" society should be.
To totally eliminate the abject greed inherent in the "free economies" (an oxymoron if ever) that
is crushing most of the working classes around the world under "global free trade (agreements)"
will be impossible.
A re-focus on what is meant by the "commons" would help enormously. And an explanation that
would appeal to the common folk by pointing out the natural opportunities to all of us (with the
exception of the true elites) by developed intellectuals and common folk leaders would also benefit
all.
By the "commons" I mean:
General benefit to most common working class people which would include the "class" definition
of "middle classes"....which are in too many cases floundering in the current economic climate.
Universal health care.
An expansion of production "co-ops".
Universal education through at least 2-4 years of "college".
A general overhaul of our Military/Industrial/Intelligence etc./Complex.
A re-allocation of our collected tax priorities (applies to the above).
A "commons" focus on a total rebuilding of our rusted, commercially destroyed environments
all across this country (and across the world).
Capitalism is a game.
There needs to be a firewall between the free flows of rabid global capital and the true needs
of a progressive society.
The game of capitalism needs rules and referees to back up those rules.
There has to be political/public will to back up those rules and referees with force of law.
We need a total new vision for the globe.
Without it we will succumb to total social/economic chaos.
We here in the US have no true progressive vision exhibited by any candidate.
Bernie Sanders comes close but no cigar.
Hillary C. is trying to exert the vision of seeking the presidency as a kind of, "family business."
Trump is appealing to many who have been trashed by globalization.......
Continuous warfare is not a foreign policy. Greed and narcissism is not a national one. We
continue to fail in history lessons.
As I would expect, Thomas (The Wrecking Crew: How Conservatives Rule; What's the Matter With Kansas?)
Frank offers insights that Clintonites can ignore at their peril. As the widow of a hardworking
man who was twice the victim of "outsourcing" to Malaysia and India, and whose prolonged illness
brought with it savings-decimating drug costs, I can well see how Trump's appeal goes beyond xenophobia
and racism.
Everybody knows that Trump sends jobs overseas and employs illegals, even his devotees. This destroys
Frank's argument that people adore Trump because he sympathizes with their pain and actively wants
to help them.
Frank did not write that "people adore Trump because he sympathizes with their pain and actively
wants to help them." As Tom Lewandowski, the president of the Northeast Indiana Central Labor
Council in Fort Wayne, said, "We've had all the political establishment standing behind every
trade deal, and we endorsed some of these people, and then we've had to fight them to get them
to represent us."
Ill-considered trade deals (NAFTA ended a million jobs) and generous bank
bailouts and guaranteed profits for insurance companies but no recovery for average people, ever
– these policies have taken their toll.
Trump is saying that NAFTA and neo-liberalism have failed the American people.
You could be describing Hillary and Bill the fraudulent guy who "feels your pain". Liars and
in the pockets of bankers, that couple is not your friend.
Frank's argument is on what his followers believe to be true. Frank admits that their beliefs
may be naive. He is writing on the reasons for Trump's popularity.
Beyond who or what i vote for, It is nice to see a news article focusing on issues and platforms
instead of one of the many attacks or other issues seperating politics from legislation. I want
news on candidates positions, ideas, plans. This circus of he said she said and the other junk
used to sway votes or up ratings is beyond dumb.
Free trade is like all other good ideas, it only works if it is kept in balance.
Understanding the internal structure of the Atom is a good idea. Proliferating Hydrogen bombs,
the same idea taken way too far..
And as for bad human ideas, well just the worst thing on the planet.
People support Trump and the very different Corbyn because they can see that that our current
version of Free trade is hopelessly inefficient and screws everybody except the very rich.
They care about power. Progressives don't give a sod about the minorities or supposedly oppressed
groups they bang on about. They want power and they are getting lots of it. When the West burns,
those progressives who acquired enough power will be safe inside their walled fortresses with
their bodyguards.
Its' a sad truth that corporations have used trade deals to increase profits by shipping jobs
to areas where pay is sometimes 1/10 of pay in US. Sanders is the only other politician voicing
concern. In fact Sanders is responsible for the stall on the next trade deal with China and Japan.
Japan and China uses devaluation s a trade barrier and World Trade does nothing. we are constrained
in our ability to devalue our currency because of the effect on the stock market. many Americans
rely on money invested into stocks and bonds.
I don't see a true value to trade if it involves loss of jobs and lowered pay. I do see
value in fair trade where we receive somewhat equal return , like 60/40, like in China and
Japan where the return is more like 80 for them 20 for us.
Yes, Trump does talk about jobs/economy but let us not forget that the Third Reich also promised
to end runaway inflation and unemployment. To a large extent, they did low unemployment levels.
However, racism was an important galvanizing factor.
In the Middle Ages, racism was a galvanizing factor in the Crusades. Muslims dominated Mediterranean
trade and stop it, European monarchy used racism against Moors/Saracens/Turks to garner support
against the Muslims at that time.
So, for history,s sake, let,s just call a spade a spade..........Trump is racist and so are
his supporters (among other things).
While I'm no fan of big corporations or NAFTA (which was negotiated by Bush #1 and Brian Mulroney,
both conservatives), no one seems to be talking about the other side of the equation - demand.
Perhaps jobs are going to Mexico, China etc. in part because consumers won't pay the cost of a
product manufactured in rich nations. Small example - a big outdoors co-op here in Canada used
to sell paniers and other bike bags made by a company in Canada. Consumers would not buy them
because they cost more, so the firm closed down and that co-op's bike equipment now comes from
Viet Nam.
If Trump forces Apple or Ford to return jobs to the US, will the products they make
be too expensive for the consumers? If a tariff wall goes up around the US, will the notoriously
frugal American shoppers start to get annoyed because, while they have t-shirt factories in wherever
state, the products they want cost more than what they want (or can) pay for?
I don't have any special insight into the effects on consumer prices of tariffs, but I do think
it's at least prudent to include that in the discussion before starting a trade war.
Hilarious.. talk about "I love the uneducated!" Yeah because everything he rants about with free
trade he has benefited from.. let us not forget MADE IN CHINA Trump suits.
The Guardian's incessant Trump bashing disguises, unfortunately, how similarly repugnant Cruz(particularly)
and Rubio are. Clinton is better, not by far, and Sanders though wonderfully idealist and full
of integrity, will be able to accomplish nothing with the Republicans controlling Congress.
I'm living in Japan, where in the past decade they have taken in 11 refugees. That's not 11
million or even 11 thousand. I mean 11.
Progressives may be surprised to hear that Japan is a wonderful country, not only free from
imported terrorism but also mind-boggling safe. I mean "leave your laptop on the street all day
and it won't get stolen" safe. They also have cool anime and Pokemon and toilets which are like
the Space Shuttle.
And guess what, they are not racist. They have borders and they are not racist. I know
this is a hard concept for progressives to get their heads around, but believe it or not it is
possible.
By the way, they think Europeans are absolute INSANE to let in these touchy-feely economic
migrants. They're right, and Europe is going to pay one hell of a pric
Neil24
The Guardian's incessant Trump bashing disguises, unfortunately, how similarly repugnant
Cruz(particularly) and Rubio are. Clinton is better, not by far, and Sanders though wonderfully
idealist and full of integrity, will be able to accomplish nothing with the Republicans controlling
Congress.
"... As soon liberalism feels it can plausibly claim to have moved overcome the socialist and fascist challenges (the Fukuyamaist "end of history" and/or "end of ideology") these ideologues are empowered to act as if liberalism's adaptive response to the socialist and fascist challenges was never necessary in the first place - bye bye welfare state, hello neoliberalism ..."
"... I'm thinking more of local governments like the ones stereotypically predominant in the Southeast, or even the legendarily corrupt history of "machine" politics in cities like Chicago. ..."
"... So in order to uphold the legitimacy of the system as such we acknowledge that sure, someone in rural Louisiana might not always be able to get rid of their corrupt local mayors/sheriffs/judges/etc. through the ballot box directly, but at least they can vote in federal elections for the people and institutions that will ..."
"... Accordingly, to treat the federal system as itself no more inherently legitimate than the local ones - to treat the government in Washington as fundamentally the same kind of racket as the government in Ferguson - is to argue that it needs fundamentally the same kind of external oversight, and barring a foreign invasion or a world government, the only potentially equivalent overseer for the US federal government is a mass revolt. ..."
"... The elite project of putting neoliberalism into practice and of selling it to the masses has failed ..."
"... the elites were telling us that Brexit wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that he did shows in part how neoliberalism has failed. ..."
"... Neoliberalism is all about markets and the free flow of capital, not political interference from unions or government. From democracy or citizens. ..."
"... Neoliberalism has failed both in practice and as a means to indoctrinate the voters. ..."
"... That's why you have all of these Trump voters or Brexit voters or other tribalists who no longer believe what the center-right is selling them about lower taxes and less regulation delivering prosperity. About immigration and internationalism being a good thing. ..."
"... The elite project of putting neoliberalism into practice and of selling it to the masses has failed ..."
"... the elites were telling us that Brexit wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that he did shows in part how neoliberalism has failed. ..."
"... I do think it is helpful to see the deregulation of finance beginning in the Carter and Reagan Administrations leading eventually to the GFC of 2008 as an historical project and a political whole, in which there have been deviations between the stated intentions of advocates, the reasonable anticipation of consequences by experts and the self-interested pursuit of short-term advantage in regulatory evasion and reform. ..."
As far as a definition, at least on the level of ideology I'd go with the following simplified-to-the-utmost
historical overview…
1. Liberalism (the 18th- and 19th-century bourgeois ideology of capitalism) defeats conservatism
(the 18th- and 19th-century aristocratic ideology of anti-capitalism)
2. Triumphant liberalism faces insurgent ideological challenges from its left and right (i.e.
Quiggin's "three-party system" model, except the three parties are clearly understood to be socialism,
liberalism, and fascism)
3. Liberalism is forced to respond to these challenges, in particular responding to the socialist
critique with the ideology of Keynesian interventionist "welfare liberalism" - ideologues of older
liberalism consider this response itself a taint of corruption
4. As soon liberalism feels it can plausibly claim to have moved overcome the socialist
and fascist challenges (the Fukuyamaist "end of history" and/or "end of ideology") these ideologues
are empowered to act as if liberalism's adaptive response to the socialist and fascist challenges
was never necessary in the first place - bye bye welfare state, hello neoliberalism
In any case, it's utterly bizarre to see people object so stridently to "neoliberalism" who
simultaneously don't seem to have a problem with the imperialist, anti-intellectual, and quite
frankly racist connotations of the term "tribalism".
Will G-R 09.02.16 at 4:19 pm
Bruce @ 104, I'm not clued into the SoCal-specific issues (so I don't know exactly how much a
Chinatown -esque narrative should be raised in contrast to your description of LA water
infrastructure as "the best of civic boosterism") but I'm thinking more of local governments
like the ones stereotypically predominant in the Southeast, or even the legendarily corrupt history
of "machine" politics in cities like Chicago.
he fact that these sorts of governments exist and have existed in the US is why every American,
even those of us who are well aware of McCarthyism and COINTELPRO and so on, can breathe a sigh
of relief when we see the words "the Justice Department today announced a probe aimed at local
government officials in…" because it means that the legitimate parts of our system are
asserting their predominance over the potentially illegitimate parts.
So in order to uphold the legitimacy of the system as such we acknowledge that sure, someone
in rural Louisiana might not always be able to get rid of their corrupt local mayors/sheriffs/judges/etc.
through the ballot box directly, but at least they can vote in federal elections for the people
and institutions that will get rid of these officials if they overstep the bounds of
what we as a nation consider acceptable. (This also extends to more informal institutions
like the media: the local paper might not be shining the light on local corruption, but the media
as such can fulfill its function and redeem its institutional legitimacy if something too egregious
falls into the national spotlight.)
Accordingly, to treat the federal system as itself no more inherently legitimate than the
local ones - to treat the government in Washington as fundamentally the same kind of racket as
the government in Ferguson - is to argue that it needs fundamentally the same kind of external
oversight, and barring a foreign invasion or a world government, the only potentially equivalent
overseer for the US federal government is a mass revolt.
The center-right hasn't really delivered and neither has the center-left. The elite project
of putting neoliberalism into practice and of selling it to the masses has failed . This
is an opportunity for the left but also a time fraught with danger should the tribalists somehow
get the upperhand. I feel the U.S. is too diverse for this to happen but it might in other nations.
I am hoping that Trump suffers a sound beating but then the elites were telling us that Brexit
wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that he did shows
in part how neoliberalism has failed.
" American liberalism has always been internationalist and mildly pro-free-trade. It's also
been pro-union…"
Then why are unions in such bad shape? Neoliberalism is all about markets and the free
flow of capital, not political interference from unions or government. From democracy or citizens.
Think about the TPP where corporate arbitration courts can be used by corporations to sue
governments without regard to those nations' legislation. I'd be more in favor of international
courts if they weren't used merely to further corporate interests and profits. Neoliberals argue
that what benefits these multinational corporations benefits their home country.
I pretty much agree with what Quiggin is saying here. Neoliberalism has failed both in
practice and as a means to indoctrinate the voters. The soft neoliberals have been putting
neoliberalism into practice over the objections of their electoral coalition partners. It hasn't
delivered.
That's why you have all of these Trump voters or Brexit voters or other tribalists who
no longer believe what the center-right is selling them about lower taxes and less regulation
delivering prosperity. About immigration and internationalism being a good thing.
The center-right hasn't really delivered and neither has the center-left. The elite project
of putting neoliberalism into practice and of selling it to the masses has failed. This is
an opportunity for the left but also a time fraught with danger should the tribalists somehow
get the upperhand. I feel the U.S. is too diverse for this to happen but it might in other nations.
I am hoping that Trump suffers a sound beating but then the elites were telling us that Brexit
wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that he did shows
in part how neoliberalism has failed.
... I do think it is helpful to see the deregulation of finance beginning in the Carter and
Reagan Administrations leading eventually to the GFC of 2008 as an historical project and a political
whole, in which there have been deviations between the stated intentions of advocates, the reasonable
anticipation of consequences by experts and the self-interested pursuit of short-term advantage
in regulatory evasion and reform.
"... The era of unchallenged neoliberal dominance is clearly over. Hopefully, it will prove to have been a relatively brief interruption in a long term trend towards a more humane and egalitarian society. Whether that is true depends on the success of the left in putting forward a positive alternative. ..."
"... Third, the "individualist" thingies work as long as people believe that they are on the winning side; but there is evidence enough today that most people are on the losing side of increasing inequality, so most people have reason to be pro leftish policies both in "moralistic" terms and in "crude self interest" terms. In the past this wasn't obvious, but today it is, and this drum should be banged more. ..."
"... Bob Zanelli @ 10, your comment perfectly embodies an ideological trap to be avoided at all costs. What Quiggin calls tribalism is precisely not ..."
"... I can't speak for other industrialized democracies, but in the US, there is essentially no ability for the left to engage in structural change. Every avenue has been either blocked by the 18th century political structures of the US (sometimes exploited in extraordinary ways by the monied powers that those structures enable) or subsumed by the neoliberal individualist marketification of everything. ..."
"... To just discount the reality of our evolutionary baggage by calling it sociobiology is an example of classic Marxist ideology which seems to require the perfectibility of human nature. ..."
"... I just think we should call what he calls "tribalism" by its proper name - fascism - instead of deliberately tainting our theories with overtones of an "enlightened civilized wisdom versus backwards tribal savages" narrative that itself is central to fascist/"tribalist" ideology and therefore belongs in the dustbin of history. Surely flouting Godwin's Law is a lesser sin than knowingly perpetuating the discourses of racism. ..."
"... Marxism isn't evil and Nazism is evil. So political ideology can be evil or just wrong and accomplish evil. We are indebted to Marx for describing the nature of class warfare and the natural trends of accumulation based economics , but we now know his solution is a failure. So either we learn from this or we cling on to outmoded ideas and remain irrelevant. ..."
"... It seems pretty hardwired, at least enough that not planning around it would be foolish. ..."
"... It turns out that you can't say things like "globalism is great for the UK GDP" and expect citizens of the 'UK' to be excited about it if they feel too alienated from the people who are making all of the money. ..."
"... Punching "globalism" into Google returns the following definition from Merriam-Webster: "a national policy of treating the whole world as a proper sphere for political influence - compare imperialism, internationalism." ..."
"... I agree with bob mcm that Trump_vs_deep_state isn't fascism. It's not a serious analysis to say that it is. ..."
"... I take note of the Florida primary results, just in: Debbie Wasserman-Schultz did just fine, as did her hand-picked Democratic Senate candidate, the horrible Patrick Murphy. ..."
"... Oh, and Rubio is back. Notice of the death of neoliberalism might be premature. ..."
"... I mean Judas Iscariot, I mean Bill Clinton, you can make a case that he did his best to salvage something from the wreckage. To repeat what I've said here before, when he was elected the Democrats had lost five of the last six elections, most by landslides. The one exception was the most conservative of the Democratic candidates, who was despised by the left. The American people had decisively rejected what the Democrats were selling. False consciousness, no doubt. ..."
"... The obscurity and complexity of, say, Obamacare or the Greek bailout is a cover story for the looting. ..."
"... The problem is not that the experts do not understand consequences. The problem is that a broken system pays the top better, so the system has to be broken, but not so broken that the top falls off in collapse. ..."
"... Very well said. Resource limits shadow the falling apart of the global order that the American Interest link Peter T points to. If the billionaires are looting from the top and the response is a criminal scramble at the bottom, the unnecessariat will be spit out uncomprehending into the void between. ..."
"... So much concern about the term tribalism. Well what is fascism? The use of tribalism to grasp political power and establish a totalitarian political order. Sound reasonable? Pick any fascism you like, the Nazis ( master race) the theocratic fascists in the US ( Christian rule ) Catholic Fascism ( Franco's Spain) , you name it. It walks and talks like tribalism. Trump-ism is the not so new face of American fascism. It's race based, it xenophobic, it's embraces violence, has a disdain for civil liberties and human rights, and it features the great leader. Doesn't seem to difficult to make the connection. ..."
"... Neoliberalism is the politics of controlled dismantling of the institutions of a society that formerly worked for a larger portion of its participants. Like a landlord realizing increased cash flow from a decision to forego maintenance and hire gangsters to handle rent collection, neoliberalism seeks to divert the dividends from disinvestment to the top ..."
"... The cadre managing this technically and politically difficult task - it is not easy to take things apart without critical failures exemplified by system collapse prompting insurrection or revolution - are rewarded as are society's owners, the 1/10th of 1%. Everybody else is screwed - either directly, or by the consequences of the social disintegration used to feed a parasitic elite. ..."
"... "Lesser evil" is a story told to herd the masses. If there are two neoliberal politicians, both are corrupt. Neither intends to deliver anything to you on net; they are competing to deliver you. ..."
"... I am not enthusiastic about this proposed distinction between "hard" and "soft" neoliberalism. Ideologically, conservative libertarians have been locked in a dialectic with the Clintonite / Blairite neoliberals - that's an old story, maybe an obsolete story, but apparently not one those insist on seeing neoliberalism as a monolithic lump fixed in time can quite grasp, but never mind. ..."
"... Good cop, bad cop. Only, the electorate is carefully divided so that one side's good cop is the other side's bad cop, and vice versa. ..."
"... In fact, there was a powerful fascist movement in many Allied states as well. Vichy France had deep, strong domestic roots in particular, but the South African Broederbond and Jim Crow USA with its lynchings show how fascism and democracy (as understood by anti-Communists) are not separate things, but conjunctural developments of the capitalist states, which are not organized as business firms. ..."
"... "an obligation to vote in a democracy" ..."
"... orders you to consent ..."
"... if the US government was ever thrown it would be by the far right ..."
"... Not voting is routinely interpreted as tacit consent. ..."
The failure of neoliberalism poses both challenges and opportunities for the
left. The greatest challenge is the need to confront rightwing tribalism as
a powerful political force in itself, rather than as a source of political support
for hard neoliberalism. Given the dangers posed by tribalism this is an urgent
task. One part of this task is that of articulating an explanation of the failure
of neoliberalism and explaining why the simplistic policy responses of tribalist
politicians will do nothing to resolve the problems. The other is to appeal
to the positive elements of the appeal of tribalism, such as solidarity and
affection for long-standing institutions and to counterpose them to the
self-seeking individualism central to neoliberalism, particularly in the hard
version with which political tribalism has long been aligned.
The great opportunity is to present a progressive alternative to the accommodations
of soft neoliberalism. The core of such an alternative must be a revival of
the egalitarian and activist politics of the postwar social democratic moment,
updated to take account of the radically different technological and social
structures of the 21st century. In technological terms, the most important development
is undoubtedly the rise of the Internet. Thinking about the relationship between
the Internet economy and public policy remains embryonic at best. But as a massive
public good created, in very large measure, by the public sector, the Internet
ought to present opportunities for a radically remodeled progressive policy
agenda.
In political terms, the breakdown of neoliberalism implies the need for a
political realignment. This is now taking place on the right, as tribalists
assert their dominance over hard neoliberals. The most promising strategy for
the left is to achieve a similar shift in power within the centre-left coalition
of leftists and soft neoliberals.
This might seem a hopeless task, but there are positive signs, notably in
the United States. Although Hillary Clinton, an archetypal soft neoliberal,
has won the Democratic nomination for the Presidency and seems likely to win,
her policy proposals have been driven, in large measure by the need to compete
with the progressive left. There is reason to hope that, whereas the first Clinton
presidency symbolised the capture of the Democratic Party by soft neoliberalism,
the second will symbolise the resurgence of social liberalism.
The era of unchallenged neoliberal dominance is clearly over. Hopefully,
it will prove to have been a relatively brief interruption in a long term trend
towards a more humane and egalitarian society. Whether that is true depends
on the success of the left in putting forward a positive alternative.
Brett 08.30.16 at 5:49 am
I don't know. I think for a true triumph over the existing order, we'd need
true international institutions designed to enhance other kinds of protections,
like environmental and labor standards world-wide. That doesn't seem to
be in the wings right now, versus a light version of protectionism coupled
with perhaps some restoration of the welfare state (outside of the US –
inside the US we're going to get deadlock mildly alleviated by the Supreme
Court and whatever types of executive orders Clinton comes up with for the
next eight years).
Andrew Bartlett 08.30.16 at 6:15 am
"The other is to appeal to the positive elements of the appeal of
tribalism, such as solidarity and affection for long-standing institutions"
My only worry with that is the strong overlap between tribalism and racism,
at least in it's political forms. Harking to the myth of a monocultural
past could be seen by some as 'affection for long-standing institutions'.
(I know that's not what the author is thinking, but left has had it's racism
and pro-discrimination elements, and I am wary of giving too much opportunity
for those to align with that of the right)
bruce wilder 08.30.16 at 7:29 am
I wonder, how do you envision this failure of neoliberalism?
It seems like an effective response would depend somewhat on how you
think this anticipated political failure of neoliberalism plays out over
the next few years. And, it is an anticipated failure, yes? or do you see
an actual political failure as an accomplished fact?
And, if it is still an anticipated failure, do you see it as a political
failure - the inability to marshall electoral support or a legislative coalition?
Or, an ideological style that's worn out its credibility?
Or, do you anticipate manifest policy failure to play a role in the dynamics?
MisterMr 08.30.16 at 9:31 am
"The other is to appeal to the positive elements of the appeal of tribalism,
such as solidarity and affection for long-standing institutions and to counterpose
them to the self-seeking individualism central to neoliberalism"
I don't agree with this. First, appealing to tribalism without actually
believing in it is a dick move. Second, actually existing tribalists are
arseholes, or rather everyone when is taken by the tribalist demon becomes
an arsehole.
Third, the "individualist" thingie work as long as people believe that
they are on the winning side; but there is evidence enough today that most
people are on the losing side of increasing inequality, so most people have
reason to be pro lftish policies both in "moralistic" terms and in "crude
self interest" terms. In the past this wasn't obvious, but today it is,
and this drum should be banged more.
PS: about increasing inequality, there are two different trends that
usually are mixed up:
1) When we look at inequality at an international level, the main determinant
is differential "productivity" among nations. The productivity of developing
nations (mostly China) went up a lot, and this causes a fall in international
inequality.
2) When we look at inequalityinside a nation, it depends mostly on how
exploitative the economic system is, and I think that the main indicator
of this is the wage share of total income; as the wage share fell, income
inequality increased. This happened both in developed and developing countries.
These two determinants of inequality are mixed up and this creates the
impression that, say, the fall in wages of American workers is caused by
the ascent of Chinese workers, whereas instead both American and Chinese
workes lost in proportion, but the increase in productivity more than compensated
the fall in relative wages.
Mixing up these two determinants causes the rise in nationalism, as workers
in developed nations believe that they have been sacrificed to help workers
in developing nations (which isn't true). This is my argument against nationalism
and the reason I'm skeptic of stuff like brexit, and this makes me sort
of allergic to tribalism.
Bob Zannelli 08.30.16 at 11:43 am
This analysis by Quiggin is spot on. Clearly the way forward holds both
promise and great peril, especially in the nuclear age. The notion that
Trump is just more of the same from the GOP is deluded. He represents a
dangerous insurgency of radical rightists , who can be quite fairly be called
racist and religious extremist based fascists. A Trump win could well close
the curtain on democracy in America. Neo liberalism is being repudiated
, will the elite now turn to the fascists to hold their ground, as happened
in Germany? It's a troubling question.
casmilus 08.30.16 at 11:46 am
"The great opportunity is to present a progressive alternative to the
accommodations of soft neoliberalism. The core of such an alternative
must be a revival of the egalitarian and activist politics of the postwar
social democratic moment, updated to take account of the radically different
technological and social structures of the 21st century. In technological
terms, the most important development is undoubtedly the rise of the
Internet."
Why is that any more important than the invention of digital computers,
starting from the 1940s? Just a further evolution. The real challenge is
from robotics, 3D printing and AI drivers for such processes. That really
will liquidate a lot of skilled labour; computing created a new industry
of jobs and manufacturing.
bob mcmanus 08.30.16 at 11:59 am
4: From my point of view, neoliberalism…long supply chains and logistics;
downward pressure on wages and the social wage; the growth of finance to
supply consumer credit to prop up effective demand; the culture of self-improvement
and self-management to reduce overhead and reproduction costs…no longer
supports accumulation of capital or reproduction of political legitimacy.
IOW, an economic failure.
(Anwar Shaikh's new book is definitive)
Martin 08.30.16 at 1:21 pm
Is there any knowledge of who supports tribalism? The analysis so far seems
to be in terms of tribalist policies, emotions etc, but not of who the tribalists
are, and why they support tribalist 'solutions' rather than say socialism.
Bob Zannelli 08.30.16 at 1:36 pm
Is there any knowledge of who supports tribalism? The analysis so far seems
to be in terms of tribalist policies, emotions etc, but not of who the tribalists
are, and why they support tribalist 'solutions' rather than say socialism.
Tribalism is hard wired in our genes. It can be over come with education
but too few voters ever get beyond an emotional response to what they perceive.
It's no accident that conservatives do anything they can to undermine education
and promote religious based ignorance. That's how they win elections. But
this is a dangerous game, sometimes a Hitler or a Trump shows up and steals
the show.
Will G-R 08.30.16 at 2:00 pm
MisterMr @ 5: Third, the "individualist" thingies work as long as
people believe that they are on the winning side; but there is evidence
enough today that most people are on the losing side of increasing inequality,
so most people have reason to be pro leftish policies both in "moralistic"
terms and in "crude self interest" terms. In the past this wasn't obvious,
but today it is, and this drum should be banged more.
This is where it becomes problematic that so much of this conversation
happens within individual First-World nation-states, because the inequalities
"tribalists" are interested in maintaining are precisely the inequalities
between nations on a global scale. If the "most people" you're
talking about includes the masses of recently-proletarianized working people
in the Third World, then sure "most people" have reason to be pro-left.
But when we have this conversation in a setting like this, we all implicitly
know that "most people" refers at best to the working classes of countries
like Australia and the US, and these people still perceive a decided
interest in maintaining the global economic hierarchies for which "tribalism"
serves this conversation as a signifier.
For the working classes of the First World wrapped up in their "tribalist"
defense of a global aristocracy of nations, to truly believe they're on
the losing side would mean to accept that the defense of national sovereignty
from neoliberal globalization is an inherently lost cause. If they're to
defect from the cause of "tribalism" and join the Left, this would mean
accepting a critique of the "long-standing institutions" of First-World
social democracy that appears to go much farther left even than John Quiggin
appears willing to go. (As in, the implementation of social-democratic institutions
in First-World capitalist societies is inherently a tool for enabling the
economic domination of the First World over the Third World, by empowering
a racialized labor aristocracy to serve as foot soldiers of global imperialism,
and so on and so on à la Lenin.)
Will G-R 08.30.16 at 2:09 pm
Bob Zanelli @ 10, your comment perfectly embodies an ideological trap
to be avoided at all costs. What Quiggin calls tribalism is precisely
not "hard-wired in our genes", it's an inherently modern creation
of the inherently modern political and economic forces that first created
the "imagined community" of the modern nation-state and continue to put
incredible amounts of energy into indoctrinating various populations in
its various national mythologies.
Far from being an inherent solution to this problem, education - within
the context of a national education system, educating its pupils as Americans/Australians/etc.
- is an utterly indispensable mechanism by which this process is accomplished.
Interestingly, I share all the premises, and yet none of the optimistic
conclusions. Because soft neoliberalism (and in fact even hard neoliberalism)
is much closer sociologically, politically and ideologically to the left
than tribalism is, I see the end of the hegemonic neoliberal ideology and
the correlative rise of tribalism as (somewhat paradoxically) the guarantee
for perpetual neoliberal power in the short and middle term, at least for
two reasons.
First of all, left-inclined citizens will most likely always vote for
neoliberal candidates if the alternative is a tribalist candidate (case
in point: in 9 months or so, I will in all likelihood be offered a choice
between a hard neoliberal and Marine Le Pen; what then?).
Moreover, even if/when tribalist parties gain power, their relative sociological
estrangement from the elite sand correlative relative lack of political
power all but guarantees in my mind that they will govern along the path
of least resistance for them; that is to say hard neoliberalism (with a
sprinkle of tribalist cultural moves). This is how the FPO ruled Carinthia,
for instance, and how I would expect Trump to govern in the (unlikely) eventuality
he reached power.
Finally, mass migration are bound to intensify because of climate change
(if for no other reason) and the trend internationally in advanced democratic
countries seems to be towards national divergence and hence national reversion.
I don't see how an ideologically coherent left-oriented force can emerge
in this context, but of course I would love to be proved wrong on all counts.
Lupita 08.30.16 at 2:22 pm
Bravo, Will G-R!
Bob Zannelli 08.30.16 at 2:37 pm
Will G-R 08.30.16 at 2:09 pm
Bob Zanelli @ 10, your comment perfectly embodies an ideological trap to
be avoided at all costs. What Quiggin calls tribalism is precisely not "hard-wired
in our genes", it's an inherently modern creation of the inherently modern
political and economic forces that first created the "imagined community"
of the modern nation-state and continue to put incredible amounts of energy
into indoctrinating various populations in its various national mythologies.
Far from being an inherent solution to this problem, education - within
the context of a national education system, educating its pupils as Americans/Australians/etc.
- is an utterly indispensable mechanism by which this process is accomplished.
)))))))))))))))
I don't agree. It's true that tribalism has morphed into what you call
national mythologies , but the basis for this is our evolutionary heritage
which divides the world into them and us. This no doubt had survival benefits
for hunter gatherer social units but it's dangerous baggage in today's world.
I find your comments about education curious. Are you advocating ignorance?
I think you confuse education with indoctrination , they are not the same
thing.
The question of what ideology an ideologically coherent left-oriented force
would come together around is indeed an important question, but I'll try
not to dwell on my hobbyhorses too much.
For now I'll add a slightly different area to consider this through:
current First World "left" populations (especially in the U.S.) want to
turn everything into individual moral questions through which a false solidarity
can be expressed and through which opposing people can be shamed. For instance,
I've thought a good deal about how environmental problems are the most important
problems in general at the moment, and how it's clear that they require
a redesign of our infrastructure. This is not an individual problem - no
amount of volunteer action will work. Yet people on the left continually
exert pressure to turn this into a conflict of morally good renouncers vs
wasters, something that the right is quite ready to enhance with their own
ridiculous tribal boundary markers (google "rolling coal").
You see this with appeals to racism. Racism is a real problem and destroys
real people's lives. But treating it as an individual moral problem rather
than a social, structural one is a way of setting boundaries around an elite.
The challenge for the left is going to be developing a left that, no matter
what it's based around, doesn't fall back into this individualist new-class
status preservation.
Will G-R 08.30.16 at 3:15 pm
@ Bob Zannelli, you're continuing to draw on the language of sociobiology
and evolutionary psychology without the social-scientific rigor to justify
it. (Of course, to many if not most social scientists, the very fields of
sociobiology and evopsych are largely premised on a lack of such rigor to
begin with, but that's another story.) In particular, the term doing the
heavy lifting to provide your get-out-of-rigor-free card is "morphed". What
has been the historical trajectory of this "morphing"? What social and political
institutions have been involved? With what political interests, and what
economic ones? If you think about those kinds of questions, you might make
some headway toward understanding why social scientists generally interpret
the sociocultural aspects of racism and fascism as essential, and the biological
aspects as essentially arbitrary.
To be fair, a large part of the fault here is John Quiggin's for using
a word with as much fraught ideological baggage as "tribalism" to do so
much of his own heavy lifting. The ironic thing is, the polemical power
that probably motivated Quiggin to use that word in the first place comes
from the very same set of ideological associations (e.g. "barbaric", "savage",
"uncivilized", etc.) whose application to modern political issues of race
and nationality he would probably characterize as "tribalist" in the first
place!
Holden Pattern 08.30.16 at 3:20 pm
@ comment 16:
I can't speak for other industrialized democracies, but in the US,
there is essentially no ability for the left to engage in structural change.
Every avenue has been either blocked by the 18th century political structures
of the US (sometimes exploited in extraordinary ways by the monied powers
that those structures enable) or subsumed by the neoliberal individualist
marketification of everything.
So what remains, especially given the latter, is marketing and individual
action - persuasion, shame, public expressions of virtue. That's all that
is available to the left in the United States, especially on issues like
racism and environmental problems.
So while it's good fun to bash the lefty elites in their tony coastal
enclaves and recount their clueless dinner party conversations, it's shooting
fish in a barrel. Easy for you and probably satisfying in a cheap way, but
the fish probably didn't put themselves in the barrel, and blaming them
for swimming in circles is… problematic.
Bob Zannelli 08.30.16 at 3:26 pm
@ Bob Zannelli, you're continuing to draw on the language of sociobiology
and evolutionary psychology without the social-scientific rigor to justify
it. (Of course, to many if not most social scientists, the very fields of
sociobiology and evopsych are largely premised on a lack of such rigor to
begin with, but that's another story.) In particular, the term doing the
heavy lifting to provide your get-out-of-rigor-free card is "morphed". What
has been the historical trajectory of this "morphing"? What social and political
institutions have been involved? With what political interests, and what
economic ones? If you think about those kinds of questions, you might make
some headway toward understanding why social scientists generally interpret
the sociocultural aspects of racism and fascism as essential, and the biological
aspects as essentially arbitrary.
)))))))))))
I hope it's clear that I do not discount the assertion that nationalism
and racism are part of social constructs that favor class interest. My point
is that political agendas have to work with the clay they start with. To
just discount the reality of our evolutionary baggage by calling it sociobiology
is an example of classic Marxist ideology which seems to require the perfectibility
of human nature. This is a dangerous illusion, it leads right to the gulags.
))))))))))))))))))))))))))))))
To be fair, a large part of the fault here is John Quiggin's for using
a word with as much fraught ideological baggage as "tribalism" to do so
much of his own heavy lifting. The ironic thing is, the polemical power
that probably motivated Quiggin to use that word in the first place comes
from the very same set of ideological associations (e.g. "barbaric", "savage",
"uncivilized", etc.) whose application to modern political issues of race
and nationality he would probably characterize as "tribalist" in the first
place!
"Easy for you and probably satisfying in a cheap way, but the fish probably
didn't put themselves in the barrel, and blaming them for swimming in
circles is… problematic."
I come out of the same milieu, so I don't see why it's problematic to
call attention to this. I
helped to change JQ's opinion on part of it (as he wrote later, the
facts were the largest influence on his change of opinion, but apparently
what I wrote helped) and he's an actual public intellectual in Australia.
As intellectuals our personal actions don't matter but sometimes our ideas
might.
Activism and social movements can help, even in the U.S. (I think that
350.org has had a measurable effect) so I wouldn't say that a structural
approach means that nothing is possible.
Will G-R 08.30.16 at 4:06 pm
@ Bob Zannelli: To just discount the reality of our evolutionary
baggage by calling it sociobiology is an example of classic Marxist
ideology which seems to require the perfectibility of human nature.
As hesitant as I am to play the
"Fallacy
Man" game, this is a common strawman about Marxism. In the words of
Mao Tse-Tung, as quoted by the eminent evolutionary biologist and Marxist
Richard Lewontin: "In a suitable temperature an egg changes into a chicken,
but no temperature can change a stone into a chicken, because each has a
different basis." As far as human biological capacities, it's perfectly
clear from any number of everyday examples that we're able to ignore all
sorts of outward phenotypic differences in determining which sorts of people
to consider more and less worthy of our ethical consideration, as long as
the ideological structure of our culture and society permits it - so the
problem is how to build the sort of culture and society we want to see,
and telling wildly speculative "Just-So stories" about how the hairless
ape got its concentration camps doesn't necessarily help in solving this
problem.
On the contrary, the desire to root social phenomena like what Quiggin
calls "tribalism" in our genes is itself an ideological fetish object of
our own particular culture, utilizing our modern reverence for science to
characterize social phenomena allegedly dictated by "biology" as therefore
natural, inevitable, or even desirable. Here, have a
reading /
listening recommendation.
RobinM 08.30.16 at 4:20 pm
Like Will G-R at 17 and Bob Zannelli at 19, I, too, found the use of the
term "tribalism" in the original post a bit disturbing. It's almost always
used as a pejorative. And it suggests that the "tribalists" require no deeper
analysis. I'm sure it's been around for much longer, but I think I first
took note of it when the Scottish National Party was shallowly dismissed
as a mere expression of tribalism. That the SNP (which, by the way, I do
not support) was raising questions about the deep failures of the British
system of politics and government long before these failures became widely
acknowledged was thus disregarded. Currently, an aspect of that deep failure,
the British Labour Party seems to be in the process of destroying itself,
again in part, in my estimation, because one side, among whom the 'experts'
must be numbered, seem to think that those who are challenging them can
be dismissed as "tribalists." There are surely a lot more examples.
More generally, the resort to "tribalism" as an explanation of what is
now transpiring is also, perhaps, neoliberalism's misunderstanding of its
own present predicaments even while it is part of the arsenal of weapons
neoliberals direct against their critics?
But in short, the evocation of "tribalism" is not only disturbing, it's
dangerously misleading. Those seeking to understand what may now be unfolding
should avoid using it, not least because there are also almost certainly
a whole lot of different "tribes."
awy 08.30.16 at 5:06 pm
so what's the neoliberal strategy for preserving good governance in the
face of insurgencies on the left and right?
Yankee 08.30.16 at 5:08 pm
This just in , about good tribalism (locality-based) vs bad tribalism
("race"-based, ie perceived or assumed common ancestry). It's about cultural
recognition; nationalism, based on shared allegiance to a power structure,
is different, although related (sadly)
"But as a massive public good created, in very large measure, by the public
sector .." With a large assist from non-profit-making community movements,
as with Wikipedia and Linux. (IIRC the majority of Internet servers run
on variants of the noncommercial Linux operating system, as do almost all
smartphones and tablets.) CT, with unpaid bloggers and commenters, is part
of a much bigger trend. Maybe one lesson for the state-oriented left is
to take communitarianism more seriously.
The Internet, with minimal state regulation after the vital initial pump-priming,
technical self-government by a meritocratic cooptative technocracy, an oligopolistic
commercial physical substructure, and large volumes of non-commercial as
well as commercial content, is an interesting paradigm of coexistence for
the future. Of course there are three-way tensions and ongoing battles,
but it's still working.
Will G-R 08.30.16 at 5:42 pm
RobinM, to clarify, I do think that what Quiggin calls tribalism is worth
opposing in pretty absolute terms, and I even largely agree with the meat
of his broader "three-party system" analysis. I just think we should
call what he calls "tribalism" by its proper name - fascism - instead of
deliberately tainting our theories with overtones of an "enlightened civilized
wisdom versus backwards tribal savages" narrative that itself is central
to fascist/"tribalist" ideology and therefore belongs in the dustbin of
history. Surely flouting Godwin's Law is a lesser sin than knowingly perpetuating
the discourses of racism.
Bob Zannelli 08.30.16 at 6:18 pm
In the words of Mao Tse-Tung, as quoted by the eminent evolutionary biologist
and Marxist Richard Lewontin:
Now Mao Tse-Tung, there's role model to be quoted. The thing about science
is that's it true whether you believe it not, the thing about Marxism is
that it's pseudo science and
it gave us Stalin , the failed Soviet Union, Pol Pot,, Mao Tse Tung and
the dear leader in North Korea to name the most obvious. I know, I know
, maybe someone will get it right some day.
A realist politics doesn't ignore science , this doesn't mean that socialism
is somehow precluded, in fact the exact opposite. We have to extend democracy
into the economic sphere, until we do this, we don't have a democratically
based society. It's because of human nature we need to democratize every
center of power, no elite or vanguard if you prefer can be ever be trusted.
But democracy isn't easy, you have to defeat ignorance , a useful trait
to game the system , by the elite, and create a political structure that
takes account of human nature , not try to perfect it. One would hope leftists
would learn something from history, but dogmas die hard.
Igor Belanov 08.30.16 at 6:50 pm
Bob Zannelli @27
"about Marxism is that it's pseudo science and it gave us Stalin
, the failed Soviet Union, Pol Pot,, Mao Tse Tung and the dear leader
in North Korea to name the most obvious."
To claim that Marxism 'gave us' all those wicked people must be one of
the least Marxist statements ever written! No doubt if Stalin and Pol Pot
hadn't come across the works of a 19th century German émigré then they would
have had jobs working in a florists and spending all the rest of their time
helping old ladies over the road.
Good to see Bob being consistent though. A few comments back he was suggesting
that humans are biologically 'tribalist', but now he's blaming all evil
on political ideology.
"I conceive, therefore, that a somewhat comprehensive socialisation of investment
will prove the only means of securing an approximation to full employment;
though this need not exclude all manner of compromises and of devices by
which public authority will co-operate with private initiative."
Sebastian_H 08.30.16 at 7:26 pm
'Tribalism' is giving members of what you perceive as your tribe more leeway
than you give others. (Or negatively being much more critical of others
than you would be of your tribe). It seems pretty hardwired, at least enough
that not planning around it would be foolish. Lots of 'civilization' is
about lubricating the rough spots created by tribalism while trying to leverage
the good sides.
One of the failures of neo-liberalism is in assuming that it can count
on the good side of tribalism while ignoring the perceived responsibilities
to one's own tribe. It turns out that you can't say things like "globalism
is great for the UK GDP" and expect citizens of the 'UK' to be excited about
it if they feel too alienated from the people who are making all of the
money. So then when it comes time to say "for the good of the UK we need
you to do X" lots of people won't listen to you. John asks a good question
in exploring what comes next, but it isn't clear.
Bob Zannelli 08.30.16 at 7:30 pm
about Marxism is that it's pseudo science and
it gave us Stalin , the failed Soviet Union, Pol Pot,, Mao Tse Tung and
the dear leader in North Korea to name the most obvious."
To claim that Marxism 'gave us' all those wicked people must be one of
the least Marxist statements ever written! No doubt if Stalin and Pol Pot
hadn't come across the works of a 19th century German émigré then they would
have had jobs working in a florists and spending all the rest of their time
helping old ladies over the road.
Good to see Bob being consistent though. A few comments back he was suggesting
that humans are biologically 'tribalist', but now he's blaming all evil
on political ideology.
)))))))))))))
Marxism isn't evil and Nazism is evil. So political ideology can
be evil or just wrong and accomplish evil. We are indebted to Marx for describing
the nature of class warfare and the natural trends of accumulation based
economics , but we now know his solution is a failure. So either we learn
from this or we cling on to outmoded ideas and remain irrelevant.
In the Soviet Union , science, art and literature were under assault,
with scientists, artist and writers sent to the gulag or murdered for not
conforming to strict Marxist Leninist ideology. Evolution, quantum mechanics,
and relativity were all attacked as bourgeois science. ( The need for nuclear
weapons forced Stalin later to allow this science to be sanctioned) These
days, like the Catholic Church which can no longer burn people at the stake
, old Marxists can just castigate opinions that don't meet Marxist orthodoxy.
Will G-R 08.30.16 at 8:53 pm
@ Sebastian_H: It seems pretty hardwired, at least enough that not
planning around it would be foolish.
But again, when we're talking about "tribalism" not in terms of some
vague quasi-sociobiological force of eternal undying human nature, but in
terms of the very modern historical phenomena of racism and nationalism,
we have to consider the way any well-functioning modern nation-state has
a whole host of institutions devoted to indoctrinating citizens in whatever
ideological mythology is supposed to underpin a shared sense of national
and/or racial identity. It should go without saying that whatever we think
about general ingroup/outgroup tendencies innately hardwired into human
nature or whatever, this way of relating our identities to historically
contingent social institutions and their symbols is only as innate or hardwired
as the institutions themselves.
It turns out that you can't say things like "globalism is great for
the UK GDP" and expect citizens of the 'UK' to be excited about it if they
feel too alienated from the people who are making all of the money.
At least in my view, economists are usually slipperier than that. The
arguments I've seen for neoliberal free trade (I'm not quite sure what to
make of the term "globalism") generally involve it being good for "the economy"
in a much more abstract sense, carefully worded to avoid specifying whether
the growth and prosperity takes place in Manchester or Mumbai. And there's
even something worth preserving in this tendency, in the sense that ideally
the workers of the world would have no less international/interracial solidarity
than global capital already seems to achieved.
To me the possibility that neoliberal free trade and its degradation
of national sovereignty might ultimately undermine the effectiveness of
all nationalist myths, forging a sense of global solidarity among the collective
masses of humanity ground under capital's boot, is the greatest hope or
maybe even the only real hope we have in the face of the neoliberal onslaught.
Certainly if there's any lesson from the fact that the hardest-neoliberal
political leaders are often simultaneously the greatest supporters or enablers
of chauvinistic ethnonationalism, it's that this kind of solidarity is also
one of global capital's greatest nightmares.
Will G-R 08.30.16 at 9:05 pm
Punching "globalism" into Google returns the following definition from
Merriam-Webster: "a national policy of treating the whole world as a proper
sphere for political influence - compare imperialism, internationalism."
I find it fascinating, and indicative of the ideological tension immanent
in fascist reactionaries' use of the term, that the two terms listed as
comparable to it are traditionally understood in modern political theory
as diametrically opposed to each other.
bob mcmanus 08.30.16 at 9:17 pm
Recommending Joshua Clover's new book. Riot -Strike – Riot Prime
The strike, the organized disruption at the point of production, is no
longer really available. Late capitalism, neoliberalism is now extracting
surplus from distribution, as it did before industrialism, and is at the
transport and communication streams that disruption will occur. And this
will be riot, and there won't be much organization, centralization, hierarchy
or solidarity. I am ok with "tribalism" although still looking for a better
expression, and recognizing that a tribe is 15-50 people, and absolutely
not scalable. Tribes can network, and people can have multiple and transient
affiliations.
Clover's model is the Paris Commune.
(PS: If you don't like "tribe" come up with a word or expression that
usefully describes the sociality of Black Lives Matter (movement, maybe)
or even better Crooked Timber.)
Almost all people are primarily led by emotions and use reason only secondarily,
to justify the emotions.
There is a rude set of socio-economic "principles" which they call upon
to buttress these arguments. You can hear these principles at any blue-collar
job site, and you can hear them in a college lecture on economics, too:
–nature is selfish
–resources are scarce
–money measures real value
–wants are infinite
–there ain't no such thing as a free lunch (TANSTAAFL)
–you have to work for your daily bread
–incentives matter
–people want to keep up with the Joneses
–labor should be geographically mobile
–government is inefficient
–welfare destroys families
–printing money causes inflation
–the economy is a Darwinian mechanism
These are either false, or else secondary and ephemeral, and/or becoming
inopportune and obsolete. None of them survives inspection by pure reason.
Yet this is an aggregate that buzzes around in almost everyone's head,
is INTERNALIZED as true, for expectations both personal and social. And
which causes most of our problems.
Consider TANSTAAFL: "There ain't no such thing as a free lunch." Yet
obviously there is such a thing as a cheaper lunch, or else there would
be no such thing as the improvement in the standard of living. …Okay, you
say, but "resources are scarce." …Well no, we are quickly proceeding to
the point where technological change and substitution will end real scarcity,
and without ecological degradation. Therefore: can cheaper lunches proceed
to the point where they are effectively free for the purposes of meeting
human need, "your daily bread"? …Well no, you say, because people are greedy,
and beyond their needs, they have wants: "wants are infinite." …But wait,
wants really cannot be infinite, because a "want" takes mental time to have,
and you only have so many hours in every day, and so many days in your life.
In fact your wants are finite, and quite boring, and the Joneses' wants
are finite sand boring too. (Though why you want to keep up with those boneheads
the Joneses is a bit beyond me.) …Okay, you say, but "incentives matter":
if you give people stuff, they will just slack off: "welfare destroys families."
…But wait a minute. If we have insisted that people must work to feel self-worth,
yet capitalism puts people out of work until there are no jobs available,
and there are no business opportunities to provide ever-cheaper lunches,
isn't welfare the least of our problems, isn't welfare a problem that gets
solved when we solve the real problem?
But what is the real problem? Is the real problem that we don't know
how to interact with strangers without the use of money, and so we think
that money is a real thing? Is the real problem your certain feeling that
we need to work for our self-worth? Is the real problem that capitalism
is putting itself out of business, and showing that these so-called principles
are just a bunch of bad excuses? Is the real problem that we are all caught
in a huge emotional loop of bad thinking, now becoming an evident disaster?
bob mcmanus 08.30.16 at 9:26 pm
And also of course, people looking at Trump and his followers (or their
enemies and opponents in the Democratic Party) and seeing "tribalism" are
simply modernists engaging in nostalgia and reactionary analysis.
Trump_vs_deep_state is not fascism, and a Trump Rally is not Nuremberg. Much closer
to Carnival
Wiki: "Interpretations of Carnival present it as a social institution
that degrades or "uncrowns" the higher functions of thought, speech, and
the soul by translating them into the grotesque body, which serves to renew
society and the world,[37] as a release for impulses that threaten the
social order that ultimately reinforces social norms ,[38] as a social
transformation[39] or as a tool for different groups to focus attention
on conflicts and incongruities by embodying them in "senseless" acts."
I agree with bob mcm that Trump_vs_deep_state isn't fascism. It's not a serious
analysis to say that it is.
"Tribalism" was coined as a kind of shorthand for what Michael Berube
used to refer to "I used to consider myself a Democrat, but thanks to 9/11,
I'm outraged by Chappaquiddick." It's the wholesale adoption of what at
first looks like a value or belief system but is actually a social signaling
system that one belongs to a group. People on the left refer to this signaling
package as "tribal" primarily out of envy (I write somewhat jokingly) because
the left no longer has a similarly strong package on its side.
Greg McKenzie 08.30.16 at 11:47 pm
"Tribalism" feeds into the factionalism of parties. The left has a strong
faction both inside the ALP and the Liberal Party. The Right faction, in
the NLP, is currently in ascendancy but this will not last. Just as the
Right faction (in the ALP) was sidelined by clever ALP faction battles,
the current members of the NLP's Right faction are on borrowed time. But
all politicians are "mugs" as Henry Lawson pointed out over a hundred years
ago. Politicians can be talked into anything, if it gives them an illusion
of power. So "tribalism" is more powerful than "factionalism" simply because
it has more staying power. Left faction and Right faction merely obey the
demands of their tribal masters.
bruce wilder 08.31.16 at 1:47 am
. . . the left no longer has a similarly strong package on its side
honestly, I do not think "tribalism" is a "strong package" on Right or
Left. Part of the point of tribalism in politics is just how superficial
and media driven it is. The "signaling package" is put together and distributed
like cigarette or perfume samples: everybody gets their talking points.
Pretending to care dominates actually caring. On the right - as Rich
points out with the reference to "rolling coal", some people on the Right
who have donned their tribal sweatshirts get their kicks out of supposing
that somebody on the Left actually cares and they can tweak those foolishly
caring Lefties.
bruce wilder 08.31.16 at 1:57 am
I take note of the Florida primary results, just in: Debbie Wasserman-Schultz
did just fine, as did her hand-picked Democratic Senate candidate, the horrible
Patrick Murphy.
Oh, and Rubio is back. Notice of the death of neoliberalism might
be premature.
Martin 08.31.16 at 2:11 am
@ Bob Zannelli 10: To describe something as "hard wired" is to give up:
what course of action could we take? But, then, why isn't everyone a member
of the tribalist party? Has everyone, always, been of the tribalist party?
(I know someone could argue, 'everyone is racist' or 'all these white liberals
are just as racist really', but even if that is somehow true, most are members
of the socialist party or the neoliberal party).
Rather than deciding it is all too hard, we can at least find out who
supports tribalism, why it makes sense to them, whether it benefits them,
how it benefits them, if it does, and why they support it anyway, if it
does not benefit them.
I suppose (I am guessing here), some tribalists are benefiting from differential
government support, such as immigration policies that keep out rival potential
employees, or tariff policies that keep out competitors; or at least, that
they used to benefit like that. But Crooked Timber should have readers
who can answer this kind of question from their expertise.
I suppose it's too late to try to convince people here that the term "neoliberalism"
is a virus that devastates the analytic functions of the brain, but I'll
try. The term is based on a European use of the word "liberal" that has
never had any currency in the US. It's a wholly pejorative term based on
a misunderstanding of Hayek (who did *not* believe in laissez-faire), but
may be a reasonable approximation of the beliefs of , say, Thatcher. Then
that term was confounded with a totally unconnected term invented by Peters,
who was using the word "liberal" in the American sense. And presto, we have
a seamless worlwide philosophy with "hard" and "soft" variants.
As far as, say, H. Clinton is concerned, I can see no respect in which
it would be wrong to describe her as just a "liberal" in the American sense.
American liberalism has always been internationalist and mildly pro-free-trade.
It's also been pro-union– so we can just say that's *soft* neoliberalism
and preserve our sense that we are part of a world-wide struggle. Or not.
Bernie Sanders was celebrated by the left for supporting a tax on carbon
(without mentioning, of course, what price of gasoline he was contemplating),
but this is an excellent illustration of what Peters would have considered
a neoliberal policy. The term now just seems to mean anything I don't like.
As for Benedict Arnold, I mean Judas Iscariot, I mean Bill Clinton,
you can make a case that he did his best to salvage something from the wreckage.
To repeat what I've said here before, when he was elected the Democrats
had lost five of the last six elections, most by landslides. The one exception
was the most conservative of the Democratic candidates, who was despised
by the left. The American people had decisively rejected what the Democrats
were selling. False consciousness, no doubt.
So rather than spending a lot of time celebrating victory over this hegemonic
ideology, perhaps people should be talking about liberalism and whatever
we're calling the left alternative to it.
Peter T 08.31.16 at 10:54 am
"Tribalism" is unhelpful here, because it obscures the contribution "tribalism"
has made and can make to effective social democracy. It was on the basis
of class and national tribalisms (solidarities is a better word) that social
democracy was built, and its those solidarities that give it what strength
it still has. That others preferred, and still prefer, other forms of solidarity
– built around region or religion or language – should neither come as a
surprise nor be seen as basis for opposition. It's the content, not the
form, that matters.
Self-interest is too vague and shifting, international links too weak,
to make an effective politics. Our single most pressing problem – climate
change – can clearly only be dealt with internationally. Yet the environmental
and social problems that loom almost as large are clearly ones that can
best be dealt with on national or sub-national scales. As this becomes clearer
I expect the pressure to downsize and de-link from the global economy will
intensify (there are already signs in this direction). The social democrat
challenge is then to guide local solidarities towards democracy, not decry
them.
If we're really looking for a general word that works across national boundaries,
it's a well-used one: conservatism. People sometimes object that conservatives
in one country are not the same as conservatives in another country, but
really the differences are not much greater than in liberalism across countries,
socialism, etc. Conservatism includes the characteristics of authoritarianism
and nationalism. U.S. "tribalism" is its local manifestation: the use of
"tribalism" to denote a global style of conservatism denotes a particular,
contemporary type of conservatism, just as neoliberalism is a type of liberalism.
You could divide JQ's three groups into left, liberal, conservative but
since you're using neoliberal as the middle one (e.g. a contemporary mode)
then "tribalism" or something like it seems appropriate for the last.
Note that there is no word for a contemporary mode of leftism, because
there isn't one. The closest is the acephalous or consensus style of many
recent movements and groups, but that mode hasn't won elections or taken
power.
John Quiggin,
What I see as the missing point here, and perhaps we disagree upon it's
significance, is resource limitations. We can't avoid the violent reversion
to zero sum games unless we address the problem (exactly when it has or
will reach crisis point is perhaps a point of disagreement) of expanding
population meets finite resources (or even meets already fully owned resources).
I don't buy the argument that there a technological solution, or the
argument that population will stabilize before it gets too bad (I don't
see what will drive it – because Malthus was partly right).
If people are unable to survive where they are, they will try to move,
and people already living where they are moving to won't like it. Perhaps
we are already seeing some of this, perhaps not. But it will drive tribalism
(joining together to keep the "invaders" out) and won't drive the left.
I have a feeling that the "left" should be replaced by a "green" view of
the world, but for one thing, that will need a new economics – perhaps on
the lines sketched out by Herman Daly. Maybe the term "left" is too associated
with a Marxist view of the world to be useful any more.
Will G-R 08.31.16 at 2:00 pm
Apart from the obvious advantages "fascism" brings to the table - the sense
of describing "Trump_vs_deep_state" in terms of what it seeks to develop into and not
in terms of its current and clearly underdeveloped form, as well as the
sense of tying our current state of poorly grasped ideological confusion
back to WWII as the last clear three-way "battlefield of ideologies" pitting
liberalism against fascism against socialism - the term is broadly symbolically
appropriate for the same reasons it was originally adopted by Mussolini.
The sense of national solidarity and "strength through unity" (i.e. the
socialist element of National Socialism) is exactly what John Quiggin is
characterizing as "the positive elements of the appeal of tribalism", and
the direct invocation of the Roman fasces as a symbol of pure authority
is exactly what Z is getting at with the term "archism". Sure our latter-day
manifestation of fascism hasn't (yet) led to an honest-to-God fascist
regime in any Western country, but to kid ourselves that this isn't
what it seeks or that it couldn't potentially get there would be, well,
a bit too uncomfortably Weimar-ish of us.
Besides which, I get that pooh-poohing about Godwin's Law and "everybody
I don't like is Hitler" and so on is a nearly irresistible tic in today's
liberal discourse, but c'mon people… we're all comfortable using the term
"neoliberalism", which means we're all willing to risk having the same Poli
Sci 101 conversations over and over again in the mainstream ("yes, Virginia,
Hillary Clinton and Paul Ryan are both liberals!") for the sake
of our own theoretical clarity. At the very least "fascism" would have fewer
problematic discursive connotations than "tribalism", which I absolutely
refuse to use in this conversation without putting it in sneer quotes.
bruce wilder 08.31.16 at 2:17 pm
The problem with neoliberalism is that it isn't really compatible
with a modern free market economy. Simply because that system isn't
well enough understood to allow experts, let alone informed amateurs,
to reach a consensus on what a particular change will actually do. .
. . It is the inability of the neoliberal communication style to credibly
promise control that lost it.
You seem to be dancing around the elite corruption that is motivating
the rationales provided by neoliberalism. We are going to improve efficiency
by privatizing education, health care, pensions, prisons, transport. Innovation
is the goal of deregulating finance, electricity. That is what they say.
The obscurity and complexity of, say, Obamacare or the Greek bailout
is a cover story for the looting.
The problem is not that the experts do not understand consequences.
The problem is that a broken system pays the top better, so the system has
to be broken, but not so broken that the top falls off in collapse.
bruce wilder 08.31.16 at 2:35 pm
Will G-R @ 55
So you know what Trump_vs_deep_state wants to become, so we should call it that,
rather than describe what it is, because the ideological conflicts of 80
years ago were so much clearer.
We live in the age of inverted totalitarianism. Trump isn't Mussolini,
he's an American version of Berlusconi, a farcical rhyme in echo of a dead
past. We probably are on the verge of an unprecedented authoritarian surveillance
state, but Hillary Clinton doesn't need an army of blackshirts. The historical
fascism demanded everything in the state. Our time wants everything in an
iPhone app.
bruce wilder 08.31.16 at 2:54 pm
reason @ 54
Very well said. Resource limits shadow the falling apart of the global
order that the American Interest link Peter T points to. If the billionaires
are looting from the top and the response is a criminal scramble at the
bottom, the unnecessariat will be spit out uncomprehending into the void
between.
It is hard to see optimism as a growth stock. But, an effective left
would need something to reintroduce mass action into politics against an
elite that is groping toward a solution that entails replacing the masses
with robots.
Will G-R 08.31.16 at 3:38 pm
"Trump_vs_deep_state" may be the term du jour in the US, but let's try to kick our
stiflingly banal American habit of framing everything around our little
quadrennial electoral freak shows. After all, the US and our rigid two-party
system have always been an outlier in the vigor with which real political
currents have been forced to conform to the narrow partisan vocabulary of
either a left-liberal or a right-liberal major party. If hewing religiously
to a patriotic sense of US institutionalism is supposed to ultimately save
the liberal political sphere from the underlying political-economic forces
that threaten it, we might as well take a page from the Tea Party and start
marching around in powdered wigs and tricorn hats for all the good it'll
do us.
In the rest of the Western world, particularly in Central and Eastern
Europe, the "fascist" parties (Golden Dawn in Greece, Jobbik in Hungary,
Ataka in Bulgaria, etc.) are generally less euphemistic about their role
as fascist parties, and what forced sense of euphemism does exist
seems to provide little more than a rhetorical opportunity for mockingly
transparent coyness . To be fair, the predominant far-right parties
in richer Western European countries (the FN, AfD, UKIP, etc.) are a bit
more earnestly vague about their ambitions, so maybe a good compromise would
be to call them (along with Trump) "soft fascists" in contrast to the "hard
fascists" of Golden Dawn or Ataka. But fascism still makes much more sense
than any other existing "-ism" I've seen, unless we want to just make one
up.
Marc 08.31.16 at 3:48 pm
Analogies can obscure more than they illuminate.
RichardM 08.31.16 at 4:11 pm
> You seem to be dancing around the elite corruption that is motivating
the rationales provided by neoliberalism.
Fair point. On the other hand, if neoliberalism rule, then neoliberals
will be the rulers. And if not, not. Whatever the nature of the rulers,
they rarely starve. Worldwide, average corruption is almost certainly lower
in mostly-neoliberal countries than in less-neoliberal places like China,
Zimbabwe, North Korea, …
The key thing is, take two neoliberal politicians, only one of whom is
(unusually) corrupt. One entirely intends to deliver what you ask for, admittedly
while ensuring they personally have a nice life being well-fed, warm and
listened-to. The other plans to take it all and deliver nothing.
Given that nobody trustworthy knows anything, at least in a form they
can explain, you can't get useful information as to which is which. 300
hours of reading reports of their rhetoric in newspapers, blogs, etc. leaves
you none the wiser. And by the time you have a professional-level of knowledge
of what's going on, you are part of the problem.
Might as well just stick to looking at who has which label next to their
name, or who has good hair.
Will G-R 08.31.16 at 4:16 pm
Marc, the discourse of Godwin's Law has done a wonderful job solidifying
the delusion that what '20s-through-'40s-era fascists once represented is
categorically dead and buried, which is why it seems like the word can't
be used as anything other than an obtuse historical analogy. But it's not
an analogy - it's a direct insinuation that what these people currently
represent is a clear descendant of what those people once represented, however
mystified by its conditioned aversion to the word "fascism" itself. On the
contrary, if we surrender to the Godwin's Law discourse and accept that
fascism can never mean anything in contemporary discourse except
as an all-purpose "everything I don't like is Hitler" analogy or whatever,
it means we've forgotten what it means to actually be anti-fascist.
BTW, the link from the last comment isn't working for whatever reason,
so
here's Take 2 .
Bob Zannelli 08.31.16 at 5:27 pm
So much concern about the term tribalism. Well what is fascism? The
use of tribalism to grasp political power and establish a totalitarian political
order. Sound reasonable? Pick any fascism you like, the Nazis ( master race)
the theocratic fascists in the US ( Christian rule ) Catholic Fascism (
Franco's Spain) , you name it. It walks and talks like tribalism. Trump-ism
is the not so new face of American fascism. It's race based, it xenophobic,
it's embraces violence, has a disdain for civil liberties and human rights,
and it features the great leader. Doesn't seem to difficult to make the
connection.
bruce wilder 08.31.16 at 6:14 pm
RichardM: Whatever the nature of the rulers, they rarely starve.
Still not getting it. The operative question is whether the rulers feast
because the society works or because the society fails.
Neoliberalism is the politics of controlled dismantling of the institutions
of a society that formerly worked for a larger portion of its participants.
Like a landlord realizing increased cash flow from a decision to forego
maintenance and hire gangsters to handle rent collection, neoliberalism
seeks to divert the dividends from disinvestment to the top
The cadre managing this technically and politically difficult task
- it is not easy to take things apart without critical failures exemplified
by system collapse prompting insurrection or revolution - are rewarded as
are society's owners, the 1/10th of 1%. Everybody else is screwed - either
directly, or by the consequences of the social disintegration used to feed
a parasitic elite.
The key thing is, take two neoliberal politicians, only one of
whom is (unusually) corrupt. One entirely intends to deliver what you
ask for, admittedly while ensuring they personally have a nice life
being well-fed, warm and listened-to. The other plans to take it all
and deliver nothing.
Again, you are not getting it. This isn't about lesser evil. "Lesser
evil" is a story told to herd the masses. If there are two neoliberal politicians,
both are corrupt. Neither intends to deliver anything to you on net;
they are competing to deliver you.
Any apparent choice offered to you is just part of the b.s. The "300
hours of reading" is available if you need a hobby or the equivalent of
a frontal lobotomy.
I am not enthusiastic about this proposed distinction between "hard"
and "soft" neoliberalism. Ideologically, conservative libertarians have
been locked in a dialectic with the Clintonite / Blairite neoliberals -
that's an old story, maybe an obsolete story, but apparently not one those
insist on seeing neoliberalism as a monolithic lump fixed in time can quite
grasp, but never mind.
Good cop, bad cop. Only, the electorate is carefully divided so that
one side's good cop is the other side's bad cop, and vice versa.
Hillary Clinton is running the Democratic Party in such a way that she
wins the Presidency, but the Party continues to be excluded from power in
Congress and in most of the States. This is by design. This is the neoliberal
design. She cannot deliver on her corrupt promises to the Big Donors if
she cannot play the game Obama has played so superbly of being hapless in
the face of Republican intransigence.
In the meantime, those aspiring to be part of the credentialed managerial
classes that conduct this controlled demolition while elaborating the surveillance
state that is expected to hold things together in the neo-feudal future
are instructed in claiming and nurturing their individual political identity
against the day of transformation of consciousness, when feminism will triumph
even in a world where we never got around to regulating banks.
bruce wilder 08.31.16 at 6:33 pm
Will G-R, Bob Zannelli
Actual, historical fascism required the would-be fascists to get busy,
en masse . Trump (and Clinton) will be streamed on demand so you
can stay home and check Facebook. Hitler giving a two-hour 15000 word speech
and Trump, Master of the Twitterverse, belong to completely different political
categories, if not universes.
There are so many differences and those differences are so deep and pervasive
that the conversation hardly seems worth having.
stevenjohnson 08.31.16 at 7:54 pm
Historical fascism included not just Hitler's Germany, but Mussolini's Italy,
Franco's Spain, Salazar/Caetano's Portugal, Ionescu's Romania, the Ustase
in Croatia, Tiso's Slovakia, Petliura's movement in Ukraine, and, arguably,
Dollfuss' Austria, Horthy's Hungary, Imperial Japan, Peronist Argentina,
the Poland of the post Pilsudski junta (read Beck on the diplomatics of
a Jewish state in Uganda, which is I think symptomatic wishful thinking.)
There is a strong correlation between the nations whose rulers accepted
fascists into the government and losing WWI. The rest were new, insecure
states that could profit their masters by expansion. At the time, the so-called
Allies, except for the USSR, were essentially the official "winners" of
WWI and therefore united against the would be revisionists like Germany.
Therefore it was desirable to propagandize against the Axis as uniquely
fascist.
In fact, there was a powerful fascist movement in many Allied states
as well. Vichy France had deep, strong domestic roots in particular, but
the South African Broederbond and Jim Crow USA with its lynchings show how
fascism and democracy (as understood by anti-Communists) are not separate
things, but conjunctural developments of the capitalist states, which are
not organized as business firms.
Democracy is associated even with genocide, enslavement of peoples and
mass population transfers to colonists. It began with democracy itself,
with the Spartans turning Messenians into Helots and Athenians expropriating
Euboeans and massacring Melians. Russian Cossacks on the Caucasian steppes
or Paxton Boys in the US continued the process. When democracy came to the
Ottoman empire, making Turkey required the horrific expulsion of the Armenians.
(Their Trail of Tears was better publicized than the Cherokee's.) But the
structural need to unify a nation by excluding Others led to the bloody
expulsion of Greeks as well. The confirmation of national identity by a
mix of ethnic, religious and racial markers required mass violence and war,
as seen in the emergence of the international system of mercantilist capitalist
states.
The wide variations in historical fascism conclusively demonstrate every
notion of fascism is somehow something essentially, metaphysically, antithetical
is wrong. Fascism and democracy are not an antinomy. Particular doctrines
that assert this, like the non-concept of "totalitarianism," serve as a
kind of skeleton for political movements and parties. Since the triumph
of what we in the US call McCarthyism all mainstream and all acceptable
alternative politics share this same skeleton. It is unsurprising that such
a beast is somehow not organically equipped to be an effective left. It's
SYRIZA in Greece defining itself by the rejection of the KKE. There is no
such thing as repudiation of revolution that doesn't imply accepting counter-revolution.
Evan Neely 08.31.16 at 8:03 pm
The problem I have with attempts to appeal to the supposedly "positive"
aspects of tribalism, solidarity and the affection for longstanding institutions,
is that it's presuming these aren't just our abstractions of something that's
felt at a much more primal level. Tribalists don't love solidarity for the
sake of the principle of solidarity: they feel solidarity because they love
the specific people like them that they love and hate others.
One set of tribalists doesn't look at another and say "hey, we respect
the same principles." It says "they're not our tribe!!!" Point being, you're
never going to get them on your side with appeals to abstractions. You're
almost certainly never going to get them on your side no matter what you
do.
bruce wilder 08.31.16 at 9:07 pm
There is no vast neoliberal conspiracy . . .
There obviously is a vast political movement, coordinated in ideology
and the social processes of partisan politics and propaganda. Creating a
strawperson "conspiracy" does not erase actual Clinton fundraising practices
and campaign tactics, which exist independent of whatever narrative I weave
them into.
There are no corrupt promises from Clinton to big donors . . .
Calling our present-day GOP as led by Trump "fascism" is calling it a break
with the past GOP. Corey Robin has been over this quite a bit here, but
in many important respects there is no break. GWB, for instance, sometimes
required attendees at his rallies to take a personal loyalty oath. And GWB
is hailed by some people here as being the good conservative because he
said that not all Muslims were bad, while, of course, killing a million
Muslims. The contemporary GOP is an outgrowth of GOP tradition, and while
some leftists may find calling all conservatism fascism convincing, I think
that it's only convincing for the tiny number of people who adhere to their
ideology.
But conservatism and fascism are both right-wing and people can argue
indefinitely about where the boundary is. So rather than talk about ideal
types, let's look at how the rhetoric of calling it fascism works. Calling
Trump_vs_deep_state fascism is primarily the rhetoric of HRC supporters, because functionally,
what everyone pretty much agrees on is that when fascists appear, people
on the left through moderate right are supposed to drop everything and unite
in a Popular Front to oppose them.
I don't think that people should drop everything. I think that HRC is
going to win and that forming the mental habit of supporting the Democratic
Party is easy to do and hard to break, and I think that the people who become
Democratic Party supporters because of the threat of Trump / "fascism" are
going to spend the next four years working directly against actual left
interests.
Will G-R 08.31.16 at 10:06 pm
Rich, I think it would be a mistake to consider this as a question of "our
present-day GOP as led by Trump". First because Trump isn't "leading" the
GOP in any meaningful sense;
as Jay Rosen's recent Tweet-storm encapsulates nicely , the GOP's institutional
leadership is still liberal through and through, even if its ideological
organs pander in some ideally implicit sense to what might otherwise be
a fascist constituency. And second because Trump isn't really "leading"
his own constituents either; if he were to make a high-profile about-face
on the issues his voters care about, they'd likely be just as eager to dump
him as Bernie Sanders' most passionate leftist supporters were to ignore
his pro-Clinton appeals at the DNC.
What's interesting about Trump isn't really anything to do with Trump
per se, so much as what Trump's constituency would do if the normal functioning
of the liberal institutions constraining it were to be disrupted in a serious
way. Europe in the 1910s through 1940s was full of such disruptions, and
should such an era return, the ideological currents we're now viewing through
a heavily tinted institutional window would become much clearer.
Ragweed 08.31.16 at 10:23 pm
Val etc.
I think that John's use of the word "tribalist" here means a world-view
that explicitly values members of an in-group more than members not of the
in-group. It is different from racism because it may be over other factors
than race – religion, citizenship, nationalism, or even region. And the
key word is explicitly. The big difference between tribalist and both neoliberal
and left positions is that the other two are generally universalist.
Neoliberals profess that everyone will be better off with deregulation,
free markets, and technocratic solutions, and often explicitly reject the
idea of something benefitting one racial, religious, or national group over
another (though not the educated or wealthy, because these are allegedly
meritocratic outcomes of the neoliberal order).
The left likewise generally argues for an increase in equality and equal
distribution of resources for all, whether that be class-based or based
on some sort of gender, race, or sexual equality.
So on an issue like a free trade deal, a neoliberal argument would support
it, because gains of trade and various other reasons why it would make everyone
better off; a leftist argument would oppose it on the grounds that it would
make everyone worse off; and a tribalist argument would oppose it on the
grounds that it took jobs away from American citizens, but wouldn't worry
too much about the other guys.
Of course, the lines are not always clear and distinct, they often overlap,
mix, and borrow arguments from each other, and there are often hypocrisies'
and inconsistencies (and John's point anyway is that the neoliberals tend
to draw on coalitions with the other two factions), but I think it is a
good general description of the distinction.
And it is different from the more sociological use of tribal to mean
any in-group/out-group distinction and social solidarity formation. Everyone
is tribal in the sociological sense, but the tribalist that John is referring
explicitly approves of that tribalism. A left intellectual may look down
on "ignorant, racist, blue-collar Trump supporters", with as much bias as
any tribalist, but would generally want them to have better education and
a guarantee income so they were no longer ignorant and racist, whereas the
tribalist generally thinks the other guy is less deserving.
Sam Bradford 09.01.16 at 9:20 am
What I wonder/worry about is whether tribalism, nationalism, call it what
you will, is a necessity.
It's very difficult for me to imagine an internationalist order that
provides the kind of benefits to citizens that I'd want a state to provide.
It's much easier to imagine nation states operating as enclaves of solidarity
and mutual aid in an amorphous, anarchic and ruthless globalised environment.
Yet the creation of a nation requires the creation of an in-group and an
out-group, citizens and non-citizens.
To put it more concretely: in my own country, New Zealand, the traditional
Maori form of social organisation – a kind of communitarianism – currently
appeals to me as offering more social solidarity and opportunity for human
flourishing than our limp lesser-of-three-evils democracy. It is a society
in which there is genuine solidarity and common purpose. Yet it is, literally,
tribal; it admits no more than a few thousand people to each circle of mutual
aid. I am sometimes tempted to believe that it is the correct way for human
beings to live, despite my general dislike for biological determinism. I
think I would rather abandon my obligations to the greater mass of humanity
(not act against them, of course, just accept an inability to influence
events) and be a member of a small society than be a helpless and hopeless
atom in a sea of similar, utterly disenfranchised atoms.
Will G-R 09.01.16 at 4:32 pm
Bob Zannelli: Gee what a concept, an obligation to vote in a democracy.
As flawed as the US political process is, voting still matters and can affect
change. It's not easy , but then it's never easy to reform anything.
Just to give voice to
the
contrary perspective , voter turnout appears to play at least some role
in the ideological process by which the US electoral system claims legitimacy:
even though in purely procedural terms an election could work just fine
if the total number of ballots was an infinitesimal fraction of the number
of eligible voters ("Bill Clinton casts ballot, Hillary defeats Trump by
2 votes to 1!") low voter turnout is nonetheless depicted as a crisis not
just for any particular candidate or party but for the entire electoral
process. Accordingly, if I decide not to vote and thereby to decrease voter
turnout by a small-but-nonzero amount, I'm adding a small-but-nonzero contribution
to the public argument that the electoral process as presently institutionalized
is illegitimate, so unless we propose to add a "none of the above" option
to every single race and question on the ballot, to argue that citizens
have an obligation to vote is to argue that they are obliged not to "vote"
for the illegitimacy of the system as such. And plenty of ethical and political
stances could be consistent with such a "vote", not the least of which is
a certain historical stance whose proponents argued that "whenever any Form
of Government becomes destructive of these ends, it is the Right of the
People to alter or to abolish it…"
Will G-R 09.01.16 at 5:05 pm
I mean that just as people who believe the US government is legitimate should
have the right to express their political preference at the ballot box,
people who believe the US government is illegitimate should have the right
to express their political preference at (the abstention from) the ballot
box, and that it's at least possible for this to be a consistent political
and ethical stance. Do you disagree? Is the legitimacy of your government
a first premise for you? If so, Thomas Jefferson would like a word.
(Not to imply that I hold any particular fealty to the US nationalist
mythology of the "Founding Fathers" and so on, but hey, they articulated
a certain liberal political philosophy whose present-day adherents should
at least be consistent about it.)
Bob Zannelli 09.01.16 at 5:14 pm
I mean that just as people who believe the US government is legitimate should
have the right to express their political preference at the ballot box,
people who believe the US government is illegitimate should have the right
to express their political preference at (the abstention from) the ballot
box, and that it's at least possible for this to be a consistent political
and ethical stance. Do you disagree? Is the legitimacy of your government
a first premise for you? If so, Thomas Jefferson would like a word.
(Not to imply that I hold any particular fealty to the US nationalist
mythology of the "Founding Fathers" and so on, but hey, they articulated
a certain liberal political philosophy whose present-day adherents should
at least be consistent about it.) {}
Jefferson has never impressed me very much ( except for his church state
separation advocacy) His ideal of a democratic agrarian slave society I
find not too appealing. He talked about the blood of tyrants but he spent
his time drinking fine wines and being waiting on by his slaves during the
revolutionary war. You're entitled to any views you want, but you're not
entitled to be respected if you're views are nonsensical. Good luck on the
revolution, I hope that works out for you.
Will G-R 09.01.16 at 5:15 pm
Also, not to get personal, but the smarm here is so thick you could cut
it with a knife…
"Did I get you right? Is your response to an argument you find uncomfortable
to simply intone 'holy shit'? Holy shit…"
Will G-R 09.01.16 at 5:20 pm
So wait, did you not recognize the quote from the Declaration of Independence,
or what? Your argument invoked "an obligation to vote in a democracy"
. My counterargument is that if government is supposed to be premised
on the consent of the governed, there can never be "an obligation to vote
in a democracy", because not voting is a way of expressing one's lack of
consent. As Žižek might put it, your ideal appears to be a democratic system
that orders you to consent .
Bob Zannelli 09.01.16 at 5:37 pm
So wait, did you not recognize the quote from the Declaration of Independence,
or what? Your argument invoked "an obligation to vote in a democracy". My
counterargument is that if government is supposed to be premised on the
consent of the governed, there can never be "an obligation to vote in a
democracy", because not voting is a way of expressing one's lack of consent.
As Žižek might put it, your ideal appears to be a democratic system that
orders you to consent.{}
I think anyone who expects to move the country away from Neo Liberalism
to a more progressive direction without voting is a fool. What's the alternative
, over throwing the government? If this is the plan we better not discuss
it on social media. Of course it's all nonsense, if the US government was
ever thrown it would be by the far right as almost happened under FDR during
the hey day of fascism around the world. I think too many here are still
living in a Marxist fantasy world , no one here is going to establish the
dictatorship of the proletarians. Let's get real.
Will G-R 09.01.16 at 6:09 pm
if the US government was ever thrown it would be by the far right
So let's get this straight… the only choice we have is between the center
and the far right, yet it's far leftists' fault for not being centrists
that the politics of centrism itself keeps drifting farther and farther
to the right. Screw eating from the trashcan, it's like you're mainlining
pure grade-A Colombian ideology.
stevenjohnson 09.01.16 at 6:24 pm
Will G-R@86 "… because not voting is a way of expressing one's lack of consent."
Incorrect. Not voting is routinely interpreted as tacit consent. Not voting
is meaningless, and will be interpreted as suited.
Bob Zannelli@87 "Let's get real."
Okay. What's real is, the game is rigged but you insist on making everyone
ante up and play by the rules anyhow. What's real, is you have nothing to
do with the left, except by defining the Democratic Party as the left. What's
real is that the parties could just as well be labeled the "Ins" and the
"Outs," and that would have just as much to do with the left, which is to
repeat, nothing.
bruce wilder 09.01.16 at 6:59 pm
Bob Zannelli: What's the alternative?
There is no alternative.
Bob Zannelli 09.01.16 at 7:01 pm
So let's get this straight… the only choice we have is between the center
and the far right, yet it's far leftists' fault for not being centrists
that the politics of centrism itself keeps drifting farther and farther
to the right. Screw eating from the trashcan, it's like you're mainlining
pure grade-A Colombian ideology{}
Right because the left is too busy plotting the revolution to engage
in politics.
bruce wilder 09.01.16 at 7:09 pm
Hillary Clinton is engaging in politics and she's teh most librul librul
evah! Why isn't that enough? It is not her fault, surely, that the devil
makes her do unlibrul things - you have to be practical and practically,
there is no alternative. We have to clap louder. That's the ticket!
Will G-R 09.01.16 at 7:25 pm
stevenjohnson: Not voting is routinely interpreted as tacit consent.
So why then is low voter turnout interpreted as a problem for democracy?
Why wouldn't it be a cause for celebration if a large majority of the population
was so happy with the system that they'd be happy with whoever won? On the
contrary, a helpless person's tacit refusal to respond to a provocation
can be the exact opposite of consent if whoever has them at their mercy
actually needs a reaction: think of a torture victim who sits in
silence instead of pleading for mercy or giving up the information the torturer
is after. Whether or not it truly does need it, the ideology of liberal
democracy at least acts as if it needs the legitimating idea that its leaders
are freely and actively chosen by those they govern, and refusing to participate
in this choice can be interpreted as an effort to deprive this ideology
of its legitimating idea.
bruce wilder 09.01.16 at 7:45 pm
Will G-R @ 94
Low voter turnout is interpreted as a problem by some people on
some occasions. Why generalize to official "ideology" from their idiosyncratic
and opportunistic pieties?
Why are the concerns of, say, North Carolina's legislature that only
the right people vote not official ideology? Or, the election officials
in my own Los Angeles County, where we regularly have nearly secret elections
with hard-to-find-polling-places - we got down to 8.6% in one election in
2015.
Obama's DHS wants to designate the state election apparatus, critical
infrastructure. Won't that be great? I guess Putin may not be able to vote,
after all!
Will G-R 09.01.16 at 8:12 pm
Bob, my impression is that CT is supposed to be a philosophy-oriented discussion
space (or it wouldn't be named after a line from Kant for chrissake) and
in philosophy one is supposed to subject one's premises to ruthless and
unsparing criticism, or at least be able to fathom the possibility of doing
so - including in this case premises like the legitimacy of the US government
or the desirability of capitalism. Especially in today's neoliberal society
there are precious few spaces where a truly philosophical outlook is supposed
to be the norm, and honestly I'm offended that you seem to want to turn
CT into yet another space where it isn't.
stevenjohnson 09.01.16 at 8:27 pm
Bob Zannelli@95 Don't worry, your left credentials are quite in order. I'm
not a regular, I post here occasionally for the same reason I occasionally
post at BHL, sheer amazement at the insanity of it all. My views are quite
beyond the pale.
Nonetheless your views, even though they pass for left at CT, are nonsense.
Corey Robin's project to amalgamate all conservatism into a single psychopathology
of individual minds (characters? souls?) is not useful for real politics.
His shilling for Jacobinrag.com, etc., acquits SYRIZA for its total failure
in real politics because it accomplished the most important task…making
sure KKE couldn't use a major state crisis. Similarly OWS and the Battle
of Seattle are acceptable because they are pure, untainted by anything save
failure.
As for your dismissal of Marxist fantasies, I take it you do not believe
economic crisis is endemic to the capitalist world economy, nor that imperialism
leads to war to redivide the world. And despite your alleged interest in
the location of proletarian hordes you can't see any in other countries,
unlike this country where everybody is middle class.
Delusions like that are killing us all. This country doesn't need reform,
it needs regime change. That's happening. Nixon failed, Trump might fail,
but the long slow march of the owners through the institutions of power,
gentrifying as they go, continues.
Will G-R 09.01.16 at 8:46 pm
Bruce @ 95, correct me if I'm wrong but I feel that state and (especially)
local governments in the US typically are viewed as highly prone
to borderline-illegitimizing levels of corruption - imagine how we'd characterize
the legitimacy of a City-State of Ferguson, or a Republic of Illinois under
President Blagojevich - and part of what maintains the impression of legitimacy
is the possibility of federal intervention on the people's behalf if things
at the lower levels get out of hand. Where the federal government hasn't
done so, notably in the case of African-American communities before the
mid to late 20th century, is precisely where arguments for the illegitimacy
of the entire system have gained serious traction. So IMO there could actually
be quite a bit of subversive potential if the population at large were to
openly reject the elected officials in Washington, DC as no more inherently
legitimate than those in Raleigh, NC or Los Angeles County. (I briefly tried
to look up the location within LA of its county seat and found that
Wikipedia's article "Politics of Los Angeles County" was entirely about
its citizens' voting record in federal politics, which itself illustrates
the point.)
Delusions like that are killing us all. This country doesn't need reform, it needs regime change.
Notable quotes:
"... Neoliberalism is all about markets and the free flow of capital, not political interference from unions or government. ..."
"... Neoliberalism has failed both in practice and as a means to indoctrinate the voters. The soft neoliberals have been putting neoliberalism into practice over the objections of their electoral coalition partners. It hasn't delivered. ..."
"... I am hoping that Trump suffers a sound beating but then the elites were telling us that Brexit wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that he did shows in part how neoliberalism has failed. ..."
"... The fact that these sorts of governments exist and have existed in the US is why every American, even those of us who are well aware of McCarthyism and COINTELPRO and so on, can breathe a sigh of relief when we see the words "the Justice Department today announced a probe aimed at local government officials in…" because it means that the legitimate parts of our system are asserting their predominance over the potentially illegitimate parts. ..."
"... Accordingly, to treat the federal system as itself no more inherently legitimate than the local ones - to treat the government in Washington as fundamentally the same kind of racket as the government in Ferguson - is to argue that it needs fundamentally the same kind of external oversight, and barring a foreign invasion or a world government, the only potentially equivalent overseer for the US federal government is a mass revolt. ..."
"... Corey Robin's project to amalgamate all conservatism into a single psychopathology of individual minds (characters? souls?) is not useful for real politics. His shilling for Jacobinrag.com, etc., acquits SYRIZA for its total failure in real politics because it accomplished the most important task…making sure KKE couldn't use a major state crisis. Similarly OWS and the Battle of Seattle are acceptable because they are pure, untainted by anything save failure. ..."
"... I take it you do not believe economic crisis is endemic to the capitalist world economy, nor that imperialism leads to war to redivide the world. And despite your alleged interest in the location of proletarian hordes you can't see any in other countries, unlike this country where everybody is middle class. ..."
"... Delusions like that are killing us all. This country doesn't need reform, it needs regime change. ..."
" American liberalism has always been internationalist and mildly pro-free-trade. It's also
been pro-union…"
Then why are unions in such bad shape? Neoliberalism is all about markets and the free
flow of capital, not political interference from unions or government. From democracy or
citizens. Think about the TPP where corporate arbitration courts can be used by corporations to
sue governments without regard to those nations' legislation. I'd be more in favor of international
courts if they weren't used merely to further corporate interests and profits. Neoliberals argue
that what benefits these multinational corporations benefits their home country.
I pretty much agree with what Quiggin is saying here. Neoliberalism has failed both in
practice and as a means to indoctrinate the voters. The soft neoliberals have been putting neoliberalism
into practice over the objections of their electoral coalition partners. It hasn't delivered.
That's why you have all of these Trump voters or Brexit voters or other tribalists who no longer
believe what the center-right is selling them about lower taxes and less regulation delivering
prosperity. About immigration and internationalism being a good thing.
The center-right hasn't really delivered and neither has the center-left.
The elite project of putting neoliberalism into practice and of selling it to the masses has
failed. This is an opportunity for the left but also a time fraught with danger should the tribalists
somehow get the upperhand.
I feel the U.S. is too diverse for this to happen but it might in other nations. I am hoping
that Trump suffers a sound beating but then the elites were telling us that Brexit wouldn't happen.
They also assured us Trump wouldn't win the primary. The fact that he did shows in part how neoliberalism
has failed.
Will G-R 09.02.16 at 4:19 pm
Bruce @ 104, I'm not clued into the SoCal-specific issues (so I don't know exactly how much a
Chinatown-esque narrative should be raised in contrast to your description of LA water
infrastructure as "the best of civic boosterism") but I'm thinking more of local governments like
the ones stereotypically predominant in the Southeast, or even the legendarily corrupt history
of "machine" politics in cities like Chicago.
The fact that these sorts of governments exist and have existed in the US is why every
American, even those of us who are well aware of McCarthyism and COINTELPRO and so on, can breathe
a sigh of relief when we see the words "the Justice Department today announced a probe aimed at
local government officials in…" because it means that the legitimate parts of our system are asserting
their predominance over the potentially illegitimate parts.
So in order to uphold the legitimacy of the system as such we acknowledge that sure, someone
in rural Louisiana might not always be able to get rid of their corrupt local mayors/sheriffs/judges/etc.
through the ballot box directly, but at least they can vote in federal elections for the people
and institutions that will get rid of these officials if they overstep the bounds of
what we as a nation consider acceptable. (This also extends to more informal institutions like
the media: the local paper might not be shining the light on local corruption, but the media as
such can fulfill its function and redeem its institutional legitimacy if something too egregious
falls into the national spotlight.)
Accordingly, to treat the federal system as itself no more inherently legitimate than the
local ones - to treat the government in Washington as fundamentally the same kind of racket as
the government in Ferguson - is to argue that it needs fundamentally the same kind of external
oversight, and barring a foreign invasion or a world government, the only potentially equivalent
overseer for the US federal government is a mass revolt.
stevenjohnson 09.01.16 at 8:27 pm
Bob Zannelli@95 Don't worry, your left credentials are quite in order. I'm not a regular, I post
here occasionally for the same reason I occasionally post at BHL, sheer amazement at the insanity
of it all. My views are quite beyond the pale.
Nonetheless your views, even though they pass for left at CT, are nonsense. Corey Robin's
project to amalgamate all conservatism into a single psychopathology of individual minds (characters?
souls?) is not useful for real politics. His shilling for Jacobinrag.com, etc., acquits SYRIZA
for its total failure in real politics because it accomplished the most important task…making
sure KKE couldn't use a major state crisis. Similarly OWS and the Battle of Seattle are acceptable
because they are pure, untainted by anything save failure.
As for your dismissal of Marxist fantasies, I take it you do not believe economic crisis
is endemic to the capitalist world economy, nor that imperialism leads to war to redivide the
world. And despite your alleged interest in the location of proletarian hordes you can't see any
in other countries, unlike this country where everybody is middle class.
Delusions like that are killing us all. This country doesn't need reform, it needs regime
change. That's happening. Nixon failed, Trump might fail, but the long slow march of the
owners through the institutions of power, gentrifying as they go, continues.
"... Neoliberalism is all about markets and the free flow of capital, not political interference from unions or government. From democracy or citizens. Think about the TPP where corporate arbitration courts can be used by corporations to sue governments without regard to those nations' legislation. I'd be more in favor of international courts if they weren't used merely to further corporate interests and profits. Neoliberals argue that what benefits these multinational corporations benefits their home country. ..."
"... Neoliberalism has failed both in practice and as a means to indoctrinate the voters. ..."
"... the elites were telling us that Brexit wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that he did shows in part how neoliberalism has failed. ..."
" American liberalism has always been internationalist and mildly pro-free-trade. It's also
been pro-union…"
Then why are unions in such bad shape? Neoliberalism is all about markets and the free
flow of capital, not political interference from unions or government. From democracy or citizens.
Think about the TPP where corporate arbitration courts can be used by corporations to sue governments
without regard to those nations' legislation. I'd be more in favor of international courts if
they weren't used merely to further corporate interests and profits. Neoliberals argue that what
benefits these multinational corporations benefits their home country.
I pretty much agree with what Quiggin is saying here. Neoliberalism has failed both in
practice and as a means to indoctrinate the voters. The soft neoliberals have been putting
neoliberalism into practice over the objections of their electoral coalition partners. It hasn't
delivered.
That's why you have all of these Trump voters or Brexit voters or other tribalists who no longer
believe what the center-right is selling them about lower taxes and less regulation delivering
prosperity. About immigration and internationalism being a good thing. The center-right hasn't
really delivered and neither has the center-left. The elite project of putting neoliberalism into
practice and of selling it to the masses has failed. This is an opportunity for the left but also
a time fraught with danger should the tribalists somehow get the upperhand. I feel the U.S. is
too diverse for this to happen but it might in other nations.
I am hoping that Trump suffers a sound beating but then the elites were telling us
that Brexit wouldn't happen. They also assured us Trump wouldn't win the primary. The fact that
he did shows in part how neoliberalism has failed.
The
Connecting the Dots series has convincingly shown a number of interconnected
reasons why the global system is in crisis, and why there is no way out without
a structural transformation of the dominant neoliberal system. In our contribution,
we want to stress the key importance of what we call a "value regime," or simply
put, the rules that determine what society and the economy consider to be of
value. We must first look at the underlying modes of production - i.e. how value
is created and distributed - and then construct solutions must that help create
these changes in societal values. The emerging answer for a new mode of value
creation is the re-emergence of the Commons.
With the growing awareness of the vulnerability of the planet and its people
in the face of the systemic crises created by late-stage capitalism, we need
to ready the alternatives and begin creating the next system now. To do so,
we need a full understanding of the current context and its characteristics.
In our view, the dominant political economy has three fatal flaws.
Pseudo-Abundance
The first is the characteristic need for the capitalist system to engage
in continuous capital accumulation and growth. We could call this pseudo-abundance,
i.e. the fundamental article of faith, or unconscious assumption, that the natural
world's resources are infinite. Capitalism creates a systemic ecological crisis
marked by the overuse and depletion of natural resources, endangering the balance
of the environment (biodiversity extinction, climate change, etc).
Scarcity Engineering
The second characteristic of capitalism is that it requires scarce commodities
that are subject to a tension between supply and demand. Scarcity engineering
is what we call this continuous attempt to undo natural abundance where it occurs.
Capitalism creates markets by the systemic re-engineering of potentially or
naturally abundant resources into scarce resources. We see this happening with
natural resources in the
development of "terminator seeds" that undo the seeds' natural regeneration
process. Crucially, we also see this in the creation of artificial scarcity
mechanisms for human culture and knowledge. "Intellectual property" is imposed
in more and more areas, privatizing common knowledge in order to create artificial
commodities and rents that create profits for a privileged "creator class."
These first two characteristics are related and reinforce each other, as
the problems created by pseudo-abundance are made quite difficult to solve due
to the privatization of the very knowledge required to solve them. This makes
solving major ecological problems dependent on the ability of this privatized
knowledge to create profits. It has been shown that the patenting of technologies
results in a systemic slowdown of technical and scientific innovation, while
un-patenting technologies accelerates innovation. A good
recent example of this "patent lag" effect is the extraordinary growth of
3D printing, once the technology
lost its patents.
Perpetually Increasing Social Injustice
The third major characteristic is the increased inequality in the distribution
of value, i.e. perpetually increasing social injustice.
As Thomas Piketty's Capital in the Twenty-First Century shows us,
the logic of capital is to concentrate more and more wealth into fewer hands
through compound interest, rent seeking, purchasing legislation, etc. Our current
set of rules are hardwired to increase inequality and injustice.
Stiglitz: AUG 5, 2016 8
Globalization and its New Discontents
NEW YORK – Fifteen years ago, I wrote a little book, entitled Globalization
and its Discontents, describing growing opposition in the developing world
to globalizing reforms. It seemed a mystery: people in developing countries
had been told that globalization would increase overall wellbeing. So why
had so many people become so hostile to it?
Now, globalization's opponents in the emerging markets and developing
countries have been joined by tens of millions in the advanced countries.
Opinion polls, including a careful study by Stanley Greenberg and his associates
for the Roosevelt Institute, show that trade is among the major sources
of discontent for a large share of Americans. Similar views are apparent
in Europe.
How can something that our political leaders – and many an economist
– said would make everyone better off be so reviled?
One answer occasionally heard from the neoliberal economists who advocated
for these policies is that people are better off. They just don't know it.
Their discontent is a matter for psychiatrists, not economists.
But income data suggest that it is the neoliberals who may benefit from
therapy. Large segments of the population in advanced countries have not
been doing well: in the US, the bottom 90% has endured income stagnation
for a third of a century. Median income for full-time male workers is actually
lower in real (inflation-adjusted) terms than it was 42 years ago. At the
bottom, real wages are comparable to their level 60 years ago.
The effects of the economic pain and dislocation that many Americans
are experiencing are even showing up in health statistics. For example,
the economists Anne Case and Angus Deaton, this year's Nobel laureate, have
shown that life expectancy among segments of white Americans is declining.
Things are a little better in Europe – but only a little better.
Branko Milanovic's new book Global Inequality: A New Approach for the
Age of Globalization provides some vital insights, looking at the big winners
and losers in terms of income over the two decades from 1988 to 2008. Among
the big winners were the global 1%, the world's plutocrats, but also the
middle class in newly emerging economies. Among the big losers – those who
gained little or nothing – were those at the bottom and the middle and working
classes in the advanced countries. Globalization is not the only reason,
but it is one of the reasons.
Under the assumption of perfect markets (which underlies most neoliberal
economic analyses) free trade equalizes the wages of unskilled workers around
the world. Trade in goods is a substitute for the movement of people. Importing
goods from China – goods that require a lot of unskilled workers to produce
– reduces the demand for unskilled workers in Europe and the US.
This force is so strong that if there were no transportation costs, and
if the US and Europe had no other source of competitive advantage, such
as in technology, eventually it would be as if Chinese workers continued
to migrate to the US and Europe until wage differences had been eliminated
entirely. Not surprisingly, the neoliberals never advertised this consequence
of trade liberalization, as they claimed – one could say lied – that all
would benefit.
The failure of globalization to deliver on the promises of mainstream
politicians has surely undermined trust and confidence in the "establishment."
And governments' offers of generous bailouts for the banks that had brought
on the 2008 financial crisis, while leaving ordinary citizens largely to
fend for themselves, reinforced the view that this failure was not merely
a matter of economic misjudgments.
In the US, Congressional Republicans even opposed assistance to those
who were directly hurt by globalization. More generally, neoliberals, apparently
worried about adverse incentive effects, have opposed welfare measures that
would have protected the losers.
But they can't have it both ways: if globalization is to benefit most
members of society, strong social-protection measures must be in place.
The Scandinavians figured this out long ago; it was part of the social contract
that maintained an open society – open to globalization and changes in technology.
Neoliberals elsewhere have not – and now, in elections in the US and Europe,
they are having their comeuppance.
Globalization is, of course, only one part of what is going on; technological
innovation is another part. But all of this openness and disruption were
supposed to make us richer, and the advanced countries could have introduced
policies to ensure that the gains were widely shared.
Instead, they pushed for policies that restructured markets in ways that
increased inequality and undermined overall economic performance; growth
actually slowed as the rules of the game were rewritten to advance the interests
of banks and corporations – the rich and powerful – at the expense of everyone
else. Workers' bargaining power was weakened; in the US, at least, competition
laws didn't keep up with the times; and existing laws were inadequately
enforced. Financialization continued apace and corporate governance worsened.
Now, as I point out in my recent book Rewriting the Rules of the American
Economy, the rules of the game need to be changed again – and this must
include measures to tame globalization. The two new large agreements that
President Barack Obama has been pushing – the Trans-Pacific Partnership
between the US and 11 Pacific Rim countries, and the Transatlantic Trade
and Investment Partnership between the EU and the US – are moves in the
wrong direction.
The main message of Globalization and its Discontents was that the problem
was not globalization, but how the process was being managed. Unfortunately,
the management didn't change. Fifteen years later, the new discontents have
brought that message home to the advanced economies.
"... In essence, this is a confession that "civilizing" capitalism cannot be done only "externally" by relying on the "harmony of private interests" but that the state has a bigger role that goes beyond ensuring the protection of property rights, taxation and redistribution. ..."
"... The past 35 years have shown that the neo-liberal conception of capitalism, combined with its global reach, has increased inequality to often unsustainable levels, left large segments of the population in the rich world without significant increase in real income and with heightened insecurity, and brought populist policies with a vengeance. ... ..."
"... Importing foreign labor with heavily curtailed rights has been a mainstay in many societies. Initially it was war prisoners and slaves, then with the capitalist mode of production and abolition of slavery, economic refugees from economically depressed regions. ..."
"... "Nothing wrong with Christianity except that no one ever tried it." ~George Bernard Shaw ..."
"... "Once the globalization genie got out of the bottle, there's no putting the genie back in." Oft said, but this may be a full employment statement, one that does not hold in a low equilibrium, especially for a country with a large economy that could do much more internal trade, to the detriment of many other smaller countries not so fortunately endowed. ..."
"... It may be possible to tariff away globalization for such an economy to the great benefit of those who bore its costs. ..."
"... Before abandoning neo-liberalism I'd like to see the "redistribution" part tried. ..."
"... Redistribution is best done by forcing people with money to pay workers. ..."
"... What the "neoliberal" invention is the free lunch. Lend money to the poor so the business can sell stuff without paying workers enough to buy what they want to sell. ..."
"... There has been a resurgence in leftwing movements which have coalesced around figures like Bernie Sanders and Jeremy Corbyn. There has been a rise of demagogues like Trump who blame immigrants and foreigners. ..."
The forthcoming changes in capitalism?: Sometimes it's useful to put
symbolic dates on when a different era begins. The end of Thatcherism, it
could be argued,
came on July 10 in the then PM-candidate speech by Theresa May. It was
perhaps appropriate that another woman, a Tory Prime Minister, would be
credited with the ending of Thatcherism. The key words, which immediately
attracted attention (see
also Philip Stevens in today's "Financial Times") were not those about
inequality (which has become a common place these days) but about the changes
in the internal structure of capitalism: reintroduction of workers' and
consumers' representatives on management boards, limits on the executive
pay, reduction of job insecurity for the young people and much greater access
to top jobs for those coming from less privileged backgrounds.
For the
first time since the late 1970s (at the top level of policy-making), we
are back to the issues of reforms in the way capitalism functions rather
than discussing the ways in which the external environment would be made
more market friendly. In essence, this is a confession that "civilizing"
capitalism cannot be done only "externally" by relying on the "harmony of
private interests" but that the state has a bigger role that goes beyond
ensuring the protection of property rights, taxation and redistribution.
The past 35 years have shown that the neo-liberal conception of capitalism,
combined with its global reach, has increased inequality to often unsustainable
levels, left large segments of the population in the rich world without
significant increase in real income and with heightened insecurity, and
brought populist policies with a vengeance. ...
He goes on to identify three areas where he can imagine change.
cm -> am...
Importing foreign labor with heavily curtailed rights has been a
mainstay in many societies. Initially it was war prisoners and slaves, then
with the capitalist mode of production and abolition of slavery, economic
refugees from economically depressed regions.
Business overall doesn't want free agents. One major point of work visa
program abuse is that it is (still?) socially unacceptable to curtail the
rights of working citizens to e.g. take the option to "not work", or not
for a specific employer, at their own choosing (provided ability to survive
without a wage or finding another job).
For example, one provision of the H1-B program is that one cannot stay
in the country without being officially employed (and within the skill set
for which one was brought in).
Thi$ World'$ Banker$ -> DeDude...
"revise capitalism than just burning it"
Perhaps we should also revise the holder within which capitalism spins.
The Milieu encapsulating present day capitalism is inflation. This inflationary
holder nearly requires folks to invest, to buy shares in capitalization,
shares with risk. By transplanting capitalism into a deflationary holder,
capitalism could continue to perform its many functions without requiring
nearly everyone to buy shares, to buy risk.
Within deflation, savings are rewarded with a ROI by way of the expanding
buying power of each dollar saved, an automatic ROI that frees savings from
the risk of capitalism. Sure!
The experts would continue to take calculated risks, Bill. The rank and
file would no longer need to buy shares in preparation for their retirement.
And yes, bailouts for fat bankers should be allowed to die a gruesome death.
Hey!
Our bankruptcy lawyers have been cheated out of their fun for far too
long.
Deflation is also healthy for the GTF, global Triffin fiat that we print
for profit. At present we print bonds also, but with deflation there would
be no need to print bonds, just more fiat that would give poor folk the
same ROI that is now enjoyed only by wealthy bond holders.
Deflation is also healthier for nations that operate with religious restrictions
against charging interest for bank loans. During the middle ages Christians
were not allowed to charge interest. Do we still have Christians today?
"Nothing wrong with Christianity except that no one ever tried
it." ~George Bernard Shaw
rayward
Why would the beneficiaries of globalization want to invest in public
goods in America? They wouldn't, and they don't. I suspect that many of
the beneficiaries already know it, but in the emerging phase of globalization,
American firms will be competing with China rather than collaborating with
China.
Once the globalization genie got out of the bottle, there's no putting
the genie back in. American firms shifting alliances to Vietnam from China
won't solve the problems in America and will ratchet up the potential problems
in the far east, including trade wars and real wars that are often triggered
by trade wars.
Turning inward (as the populists would do) won't make goods produced
in America more competitive in global markets; it will make them less competitive.
point -> rayward...
"Once the globalization genie got out of the bottle, there's no putting
the genie back in." Oft said, but this may be a full employment statement,
one that does not hold in a low equilibrium, especially for a country with
a large economy that could do much more internal trade, to the detriment
of many other smaller countries not so fortunately endowed.
It may be possible to tariff away globalization for such an economy
to the great benefit of those who bore its costs.
I won't hold my breath waiting...
ThaomasH
Before abandoning neo-liberalism I'd like to see the "redistribution"
part tried.
mulp -> ThaomasH...
Redistribution is best done by forcing people with money to pay workers.
Option 1: heavily tax people with lots of money they aren't spending
productively and then pay workers to build productive capital assets
that can generate returns on investment by taxes, eg, gas tax, water
fees, income taxes that rise with income return to education.
Option 2: don't tax money paid to workers to build productive capital
assets (but tax the income from those assets).
Few people are totally unable to be productive, but the investment cost
(labor) might be higher than the income. Some people with lots of money
will pay workers to invest in the disabled for a small productive return
instead of paying taxes out of concern or for a sense of duty to charity,
and that should be encouraged by not taxing money paid to labor.
For all labor income, social insurance should be taken by tax so workers
are paying to care for themselves and families collectively at a baseline.
Basically, returning to the "tax and spend" of the 60s, with every faction
getting to find groups of workers to pay. The conservatives likely love
to pay workers to make guns and bombs and pay men to act like an army -
that trained lots of idle young men with no direct, and a lot of airline
pilots. For liberals, pay workers to teach and do research. For the common
man, pay workers to build roads, railroads, schools, water and sewer, anything
to put people to work to make sure everyone gets paid a good income.
mrrunangun
Making top jobs more accessible to those from less privileged backgrounds
will require more affordable higher education and graduate professional
education for those from less privileged backgrounds. Experience has shown
that making large loans available for education does not actually make education
more affordable to those from modest backgrounds.
Progressives have discussed price controls on the health sector and indeed
Medicare has gone a long way in that direction already. Price controls in
the higher ed and especially professional schools should be considered if
we are to make these opportunities realistically available to those of modest
means.
Free Juco has been proposed by Chicago mayor Emmanuel and Tennessee governor
Haslem. That means tax increases for the rest of the citizens to replace
the money tuition provides now. That seems to me to be a reasonable proposal,
provided the tax increase actually replaced the tuition and was not subject
to the usual 50% rake-off for the political system that most taxes in Illinois
are subject to.
Back in the 1955-75 era, well-paid jobs were plentiful enough and university
education inexpensive enough that young men and women from modest backgrounds
could and did supply their own money for their own educations when parents
could not provide it. People could and did work their ways thru law school
tending bar and waiting tables then. It wasn't easy but it was doable for
ambitious bootstrappers. I doubt that could be done today. Education has
become so expensive in the contemporary world that few jobs available to
students can support the tuition + the personal expenses entailed in getting
a university education.
To recreate that kind of opportunity for today's young people, either
jobs that can support tuition and expenses have to be made available to
them or the cost of tuition and expenses need to be brought into line with
what the jobs available will support. Or a little of both. Tough challenges
either way.
John San Vant -> mrrunangun...
55-75 was about the only time in American history "well paid" Jobs were
plentiful. It also created a mess with how capitalism functions.
mulp -> John San Vant...
How so? Profits were low. Share prices tracked the labor cost of the
productive capital assets. The tax structure and demand for goods and services
from government ensured production required paying workers to the degree
that wages were bid up even for the unskilled worker. And you hired the
unskilled and trained them because you had no choice to meet demand for
your production.
Banks were tightly regulated so they couldn't rent seeking. Thus they
would lend only to people with income so lower incomes forced reduced consumption
lower profits leading to widespread support for government spending building
stuff businesses wanted so workers had more money to spend.
What the "neoliberal" invention is the free lunch. Lend money to
the poor so the business can sell stuff without paying workers enough to
buy what they want to sell.
Peter K.
"The past 35 years have shown that the neo-liberal conception of capitalism,
combined with its global reach, has increased inequality to often unsustainable
levels, left large segments of the population in the rich world without
significant increase in real income and with heightened insecurity, and
brought populist policies with a vengeance."
Again the term "populist." I don't like it.
There has been a resurgence in leftwing movements which have coalesced
around figures like Bernie Sanders and Jeremy Corbyn. There has been a rise
of demagogues like Trump who blame immigrants and foreigners.
What will the center-left do? Will Hillary and May actually put in place
policies that work? Will they try?
Or will they continue to make excuses and engage in diversions?
I liked how Obama nodded to Bernie Sanders in his speech where if you
cared about inequality or money in politics you rallied to Bernie. What
was left unsaid there?
David
He makes three (kind of vague) proposals :
The middle class needs to be encouraged or facilitated to acquire
capital as a means of reducing inequality.
Development NGOs should focus on "hard"' infrastructure development
such as roads and schools.
Europe cannot, due to demographics, become "fortress Europe" and
needs to implement immigrant worker policies that don't necessarily
grant citizenship, just the right to work and then return home (many
countries currently do this - South Korea has thousands of American
and Canadian and Australian English teachers who will never be citizens
of SK).
1. I think this is interesting. First you need a minimum wage that allows
people to save a portion of their income and invest it - 15 bucks an hour
say.
Then, remember those classes like home economics in high school? They
need to try a finance class in which kids learn how to get an online account,
and basic investment strategies like investing in index funds or mutual
funds.
I say this as someone who has a portfolio that is currently 6x my yearly
salary. I got lucky b/c I got in 2010. But long term index funds will kill
treasury bonds if secular stagnation has any truth to it.
I would had another thing: strengthen social security by a lot.
2. Infrastructure investment is vital. NGOs should be held accountable
for their budgets and should in fact be well regulated.
3. Euhhhhh, immigration. A temporary foreign worker policy would be economically
useful. But if there's more terrorist attacks in France...
"That empowerment must be both economic and political. Workers deserve
to be compensated fairly for their work, and have generous social support
programs to rely upon when economic changes that are out of their control
throw them out of work or force them to accept lower paying jobs.
We should not hesitate to ask those who have gained so much from
globalization and technological change to give something back to those
who have paid the costs of their success."
All this would have been especially great, say, forty or even thirty
years ago.
John Quiggin (
previously ) delivers some of the most salient commentary on the Brexit
vote and how it fits in with Syriza, Podemos, Jeremy Corbyn, Bernie Sanders
(etc) as well as Trump, French neo-fascists, and other hypernationalist
movements.
The core of this analysis is that while neoliberalism(s) (Quiggin argues
that US and non-US neoliberalism are different things) has failed the majority
of the world, and while things were falling apart after the financial crisis,
the left failed to offer real alternatives. The "tribalist" movements --
Trump, Leave, Golden Dawn, etc -- are anti-neoliberal, but in the absence
of any analysis, have lashed out at immigrants (rather than bankers and
financial elites) as the responsible parties for their suffering.
The US political system gives us a choice between neoliberals who hate
brown people, women, and gay people; and neoliberals who don't. Trump offers
an anti-neoliberal choice (and so did the Leave campaign). Bernie also offered
an anti-neoliberal platform (one that didn't hate brown people, women, and
lgtbq people), but didn't carry the day -- meaning that the upcoming US
election is going to be a choice between neoliberalism (but tolerance) and
anti-neoliberalism (and bigotry). This is a dangerous situation, as the
UK has discovered.
The vote for Britain as a whole was quite close. But a closer look
reveals an even bigger win for tribalism than the aggregate results
suggest. The version of tribalism offered in the Leave campaign was
specifically English. Unsurprisingly, it did not appeal to Scottish
or Irish voters who rejected it out of hand. Looking at England alone,
however, Leave won comfortably with 53 per cent of the vote and was
supported almost everywhere outside London, a city more dependent than
any other in the world on the global financial system.
Given the framing of the campaign, the choice for the left was, even
more than usually, to pick the lesser of very different evils. Voting
for Remain involved acquiescence in austerity and an overgrown and bloated
financial system, both in the UK and Europe. The Leave campaign relied
more and more on coded, and then overt, appeals to racism and bigotry,
symbolised by the murder of Labour MP Jo Cox, stabbed to death by a
neo-Nazi with ties to extreme tribalist organizations in both the UK
and US. The result was a tepid endorsement of Remain, which secured
the support of around 70 per cent of Labour voters, but did little to
shift the sentiment of the broader public.
The big problem for the tribalists is that, although their program
has now been endorsed by the voters, it does not offer a solution to
the economic decline against which most of their supporters were protesting.
Indeed, while the catastrophic scenarios pushed by the Remain campaign
are probably overblown, the process of renegotiating economic relationships
with the rest of the world will almost certainly involve a substantial
period of economic stagnation.
The terms offered by the EU for the maintenance of anything like
existing market access will almost certainly include maintenance of
the status quo on immigration. In the absence of a humiliating capitulation
by the new pro-Brexit government, that will mean that Britain (or England)
will face a long and painful process of adjustment.
Britain has voted to leave the EU. The reason? A large section of the working class, concentrated in towns and cities that have
been quietly devastated by free-market economics, decided they'd had enough.
Enough bleakness, enough ruined high streets, enough minimum wage jobs, and enough lies and fearmongering from the political class.
The issue that catalysed the vote for Brexit was the massive, unplanned migration from Europe that began after the accession of
the A8 countries and then surged again after 2008 once the Eurozone stagnated while Britain enjoyed a limp recovery.
It is no surprise to anybody who's lived their life at the street end of politics and journalism that a minority of the white
working class are racists and xenophobes. But anyone who thinks half the British population fits that description is dead
wrong.
Tens of thousands of black and Asian people will have voted for Brexit, and similar numbers of politically educated, left-leaning
workers too. Birmingham, Nottingham, Sheffield and Coventry - multi-ethnic university cities - they too went for Leave.
Neither the political centre or the pro-remain left was able to explain how to offset the negative economic impact of low-skilled
migration in conditions of (a) guaranteed free movement (b) permanent stagnation in Europe and (c) austerity in Britain.
Told by the government they could never control migration while inside the EU, just over 50% of the population decided controlling
migration was more important than EU membership.
So the problem for Labour is not, yet, large numbers of its own voters "deserting the party". They may still do so if Labour plays
this wrong - but even as late as the May council elections Labour's core vote held up.
Instead Labour's heartland voters simply decided to change the party's policy on migration from below, and forever, by
leaving the EU.
The party's front bench tried, late and in a muddled way, to come up with micro-economic solutions - more funds for areas where
the NHS and schools come under strain; a new directive to prevent employers shipping entire workforces from East Europe on poor terms
and conditions. And a promise to renegotiate the free movement pillar of the Lisbon Treaty in the future.
Because it was made late, and half-heartedly, this offer was barely heard. And clearly to some it did not seem plausible - given
the insistence of the Labour centre and the liberal bourgeoisie that migration is unmitigatedly good and "there's nothing you can
do about it". And also given the insistence of Jean Claude Juncker that there could be no renegotiation at all.
Ultimately, as I've written before, there is
a
strong case for "Lexit" on grounds of democracy and economic justice. But this won't be Lexit. Unless Labour can win an early
election it will be a fast-track process of Thatcherisation and the breakup of the UK.
Unlike me, however, many people who believe in Lexit were prepared to vote alongside right wing Tories to get to first base.
The task for the left in Britain now is to adapt to the new reality, and fast. The Labour right is already trying to pin the blame
on Corbyn; UKIP will make a play for Labour's voters. Most likely there'll be a second independence referendum in Scotland.
Corbyn was right to try and fight on "remain and reform" but his proposed reforms were never radical enough. He was also right
to devote energy to other issues - making the point that in or out of the EU, social justice and public services are under threat.
But the right and centre of Labour then confused voters by parading along with the Tory centrists who Corbyn had promised never to
stand on a platform with.
The Blairite Progress group is deluded if it thinks it can use this moment to launch a coup against Corbyn. The neoliberal wing
of the Labour Party needs to realise - it may take them a few days - that their time is over.
Ultimately it looks like Labour still managed to get 2/3 of its voters to voter Remain [I'll check this but that's what YouGov
said earlier]. So the major failure is Cameron's. It looks like the Tory vote broke 60/40 to Brexit.
It's possible Cameron will resign quickly. But that's not the issue. The issue is the election and what to fight for.
Labour has to start, right now, a big political reorientation. Here is my 10 point suggestion for how we on the left of Labour
go forward.
1. Accept the result. Labour will lead Britain out of EU if it wins the election.
2. Demand an election within 6–9 months: Cameron has no mandate to negotiate Brexit. The parties must be allowed to put their
respective Brexit plans to the electorate and thereafter run the negotiations. In that Labour should:
3. Fight for Britain to stay in the EEA and apply an "emergency brake" to migration under the rules of the EEA. That should be
a Labour goverment's negotiating position.
4. Labour should fight to keep all the EU's progressive laws (employment, environment, consumer protection etc) but scrap restrictions
on state aid, trade union action and nationalisation. If the EU won't allow that, then the fallback is a complete break and a bilateral
trade deal.
5. Adopt a new, progressive long-term migration policy: design a points based system designed to respond annually to demand from
employers and predicted GDP growth; make parliament responsible for setting the immigration target annually on the basis of an independent
expert report; the needs of the economy - plus the absolute duty to accept refugees fleeing war and torture - is what should set
the target, not some arbitrary ceiling. And devote massively more resources than before to meeting the stresses migration places
on local services.
6. Continue to demand Britain honours its duty to refugees to the tune of tens of thousands. Reassure existing migrant communities
in Britain that they are safe, welcome and cannot be expelled as a result of Brexit. Offer all those who've come here from Europe
under free movement rules the inalienable right to stay.
7. Relentlessly prioritise and attack the combined problems of low wages, in-work poverty and dead-beat towns.
8. Offer Scotland a radical Home Rule package, and create a federalised Labour Party structure. If, in a second referendum, Scotland
votes to leave the UK, Labour should offer a no-penalty exit process that facilitates Scotland rejoining the EU if its people wish.
In the meantime Labour should seek a formal coalition with the SNP to block a right wing Tory/UKIP government emerging from the next
election.
9. Offer the Republic of Ireland an immediate enhanced bilateral deal to keep the border open for movement and trade.
10. The strategic problem for Labour remains as before. Across Britain there have crystallised two clear kinds of radicalism:
that of the urban salariat and that of the low-paid manual working class. In Scotland those groups are aligned around left cultural
nationalism. In England and Wales, Labour can only win an election if it can attract both groups: it cannot and should not retreat
to becoming a party of the public sector workforce, the graduate and the university town. The only way Labour can unite these culturally
different groups (and geographic areas) - so clearly dramatised by the local-level results - is economic radicalism. Redistribution,
well-funded public services, a revived private sector and vibrant local democracy is a common interest across both groups.
11. If Labour in England and Wales cannot quickly rekindle its ties to the low-paid manual working class - cultural and visceral,
not just political - the situation is ripe for that group to swing to the right. This can easily be prevented but it means a clean
break with Blairism and an end to the paralysis inside the shadow cabinet.
From my social media feed it's clear a lot of young radical left people and anti-racists are despondent. It seems they equated
the EU with internationalism; they knew about and sympathised with the totally disempowered poor communities but maybe assumed it
was someone else's job to connect with them.
I am glad I voted to Remain, even though I had to grit my teeth. But I underestimated the sheer frustration: I'd heard it clearly
in the Welsh valleys, but not spotted it clearly enough in places like Barking, Kettering, Newport.
I am not despondent though. The Brexit result makes a radical left government in Britain harder to get - because it's likely Scotland
will leave, and the UK will disingegrate, and the Blairites will go off and found some kind of tribute band to neoliberalism with
the Libdems.
But if you trace this event to its root cause, it is clear: neoliberalism is broken.
There's no consent for the stagnation and austerity it has inflicted on people; there's nothing but hostility to the political
class and its fearmongering - whether that be Juncker, Cameron or the Blairites. As with Scotland, given the chance to disrupt the
institutions of neoliberal rule, people will do so and ignore the warnings of experts and the political class.
I predicted in Postcapitalism that the crackup of neoliberalism would take geo-strategic form first, economic second. This is
the first big crack.
It is, geopolitically, a victory for Putin and will weaken the West. For the centre in Europe it poses the question point blank:
will you scrap Lisbon, scrap austerity and boost economic growth or let the whole project collapse amid stagnation? I predict they
will not, and that the entire project will then collapse.
All we can do, as the left, is go on fighting for the interests of the poor, the workforce, the youth, refugees and migrants.
We have to find better institutions and better language to do it with. As in 1932, Britain has become the first country to break
with the institutional form of the global order.
If we do have a rerun of the 1930s now in Europe, we need a better left. The generation that tolerated Blairism and revelled in
meaningless centrist technocracy needs to wake up. That era is over.
"... Class, nationalist, and ethnic elements are all involved in the Brexit vote in a complex integration of protest. ..."
"... Press and media emphasize the nationalist and ethnic (immigrant-anti-immigrant) themes but generally avoid discussing or analyzing
the event from a class perspective. But that perspective is fundamental. What Brexit represents is a proxy vote against the economic
effects of Free Trade, the customs union called the European Union. Free trade deals always benefit corporations and investors. ..."
"... Free trade is not just about goods and services flows between member countries; it is even more about money and capital flows
and what is called direct investment. UK corporations benefit from the opportunity to move capital and invest in cheap labor elsewhere
in Europe, mostly the newly added members to the EU since 2000, in eastern europe. Free trade also means the unrestricted flow of labor.
Once these east european countries were added to the EU treaty, massive inflows of labor to the UK resulted. Just from Poland, more
than a million migrated to the UK alone. ..."
Class, nationalist, and ethnic elements are all involved in the Brexit vote in a complex integration of protest.
Press and media emphasize the nationalist and ethnic (immigrant-anti-immigrant) themes but generally avoid discussing or analyzing
the event from a class perspective. But that perspective is fundamental. What Brexit represents is a proxy vote against the economic
effects of Free Trade, the customs union called the European Union. Free trade deals always benefit corporations and investors.
Free trade is not just about goods and services flows between member countries; it is even more about money and capital flows
and what is called direct investment. UK corporations benefit from the opportunity to move capital and invest in cheap labor elsewhere
in Europe, mostly the newly added members to the EU since 2000, in eastern europe. Free trade also means the unrestricted flow of
labor. Once these east european countries were added to the EU treaty, massive inflows of labor to the UK resulted. Just from Poland,
more than a million migrated to the UK alone.
In the pre-2008, when economic conditions were strong and economic growth and job creation the rule, the immigration's effect
on jobs and wages of native UK workers was not a major concern. But with the crash of 2008, and, more importantly, the UK austerity
measures that followed, cutting benefits and reducing jobs and wages, the immigration effect created the perception (and some reality)
that immigrants were responsible for the reduced jobs, stagnant wages, and declining social services. Immigrant labor, of course,
is supported by business since it means availability of lower wages. But working class UK see it as directly impacting wages, jobs,
and social service benefits. THis is partly true, and partly not.
So Brexit becomes a proxy vote for all the discontent with the UK austerity, benefit cuts, poor quality job creation and wage
stagnation. But that economic condition and discontent is not just a consequence of the austerity policies of the elites. It is also
a consequence of the Free Trade effects that permit the accelerated immigration that contributes to the economic effects, and the
Free Trade that shifts UK investment and better paying manufacturing jobs elsewhere in the EU.
So Free Trade is behind the immigration and job and wage deterioration which is behind the Brexit proxy vote. The anti-immigration
sentiment and the anti-Free Trade sentiment are two sides of the same coin. That is true in the USA with the Trump candidacy, as
well as in the UK with the Brexit vote. Trump is vehemently anti-immigrant and simultaneously says he's against the US free trade
deals. This is a powerful political message that Hillary ignores at her peril. She cannot tip-toe around this issue, but she will,
required by her big corporation campaign contributors.
Another 'lesson' of the UK Brexit vote is that the discontent seething within the populations of Europe, US and Japan today is
not accurately registered by traditional polls. This is true in the US today as it was in the UK yesterday.
The Brexit vote cannot be understood without understanding its origins in three elements: the combined effects of Free Trade (the
EU), the economic crash of 2008-09, which Europe has not really recovered from having fallen into a double dip recession 2011-13
and a nearly stagnant recovery after, and the austerity measures imposed by UK elites (and in Europe) since 2013.
These developments have combined to create the economic discontent for which Brexit is the proxy. Free Trade plus Austerity plus
economic recovery only for investors, bankers, and big corporations is the formula for Brexit.
Where the Brexit vote was strongest was clearly in the midlands and central England-Wales section of the country, its working
class and industrial base. Where the vote preferred staying in the EU, was the non-working class areas of London and south England,
as well as Scotland and Northern Ireland. Scotland is dependent on oil exports to the EU and thus tightly linked to the trade. Northern
Ireland's economy is tied largely to Scotland and to the other EU economy, Ireland. So their vote was not surprising. Also the immigration
effects were far less in these regions than in the English industrial heartland.
Some would argue that the UK has recovered better than most economies since 2013. But a closer look at the elements of that recovery
shows it has been centered largely in southern England and in the London metro area. It has been based on a construction-housing
boom and the inflow of money capital from abroad, including from China investment in UK infrastructure in London and elsewhere. The
UK also struck a major deal with China to have London as the financial center for trading the Yuan currency globally. Money capital
and investment concentrated on housing-construction produced a property asset boom, which was weakening before the Brexit. It will
now collapse, I predict, by at least 20% or more. The UK's tentative recovery is thus now over, and was slipping even before the
vote.
Also frequently reported is that wages had been rising in the UK. This is an 'average' indicator, which is true. But the average
has been pulled up by the rising salaries and wages of the middle class professionals and other elements of the work force in the
London-South who had benefited by the property-construction boom of recent years. Working class areas just east of London voted strongly
for Brexit.
Another theme worth a comment is the Labor Party's leadership vote for remaining in the EU. What this represents is the further
decline of traditional social democratic parties throughout Europe. These parties in recent decades have increasingly aligned themselves
with the Neoliberal corporate offensive. That's true whether the SPD in Germany, the Socialist parties in France, Spain, Italy, Portugal,
and Greece, or elsewhere. As these parties have abdicated their traditional support for working class interests, it has opened opportunities
for other parties–both right and left–to speak to those interests. Thus we find right wing parties growing in Austria, France (which
will likely win next year's national election in France), Italy, Netherlands, and Scandinavia. Hungary and Poland's right turn should
also be viewed from this perspective. So should Podemos in Spain, Five Star movement in Italy, and the pre-August 2015 Syriza in
Greece.
Farther left more marxist-oriented socialist parties are meanwhile in disarray. In general they fail to understand the working
class rebellion against free trade element at the core of the recent Brexit vote. They are led by the capitalist media to view the
vote as an anti-immigrant, xenophobic, nationalist, right wing dominated development. So they in a number of instances recommended
staying in the EU. The justification was to protect the better EU mandated social regulations. Or they argue, incredulously, that
remaining in the free trade regime of the EU would centralize the influence of capitalist elements but that would eventually mean
a stronger working class movement as a consequence as well. It amounts to an argument to support free trade and neoliberalism in
the short run because it theoretically might lead to a stronger working class challenge to neoliberalism in the longer run. That
is intellectual and illogical nonsense, of course. Wherever the resistance to free trade exists it should be supported, since Free
Trade is a core element of Neoliberalism and its policies that have been devastating working class interests for decades now. One
cannot be 'for' Free Trade (i.e. remain in the EU) and not be for Neoliberalism at the same time–which means against working class
interests.
The bottom line is that right wing forces in both the EU and the US have locked onto the connection between free trade discontent,
immigration, and the austerity and lack of economic recovery for all since 2009. They have developed an ideological formulation that
argues immigration is the cause of the economic conditions. Mainstream capitalist parties, like the Republicans and Democrats in
the US are unable to confront this formulation which has great appeal to working class elements. They cannot confront it without
abandoning their capitalist campaign contributors or a center-piece (free trade) of their neoliberal policies. Social-Democratic
parties, aligning with their erstwhile traditional capitalist party opponents, offer no alternative. And too many farther left traditional
Marxist parties support Free Trade by hiding behind the absurd notion that a stronger, more centralized capitalist system will eventually
lead to a stronger, more centralized working class opposition.
Whatever political party formations come out of the growing rebellion against free trade, endless austerity policies, and declining
economic conditions for working class elements, they will have to reformulate the connections between immigration, free trade, and
those conditions.
Free Trade benefits corporations, investors and bankers on both sides of the 'trade' exchange. The benefits of free trade accrue
to them. For working classes, free trade means a 'leveling' of wages, jobs and benefits. It thus means workers from lower paid regions
experience a rise in wages and benefits, but those in the formerly higher paid regions experience a decline. That's what's been happening
in the UK, as well as the US and north America.
Free Trade is the 'holy grail' of mainstream economics. It assumes that free trade raises all boats. Both countries benefit. But
what that economic ideology does not go on to explain is that how does that benefit get distributed within each of the countries
involved in the free trade? Who benefits in terms of class incomes and interests? As the history of the EU and UK since 1992 shows,
bankers and big corporate exporters benefit. Workers from the poor areas get to migrate to the wealthier (US and UK) and thus benefit.
But the indigent workers in the former wealthier areas suffer a decline, a leveling. These effects have been exacerbated by the elite
policies of austerity and the free money for bankers and investors central bank policies since 2009.
So workers see their wages stagnant or decline, their social benefits cut, their jobs or higher paid jobs leave, while they see
immigrants entering and increasing competition for jobs. They hear (and often believe) that the immigrants are responsible for the
reduction of benefits and social services that are in fact caused by the associated austerity policies. They see investors, bankers,
professionals and a few fortunate 10% of their work force doing well, with incomes accelerating, while their incomes decline. In
the UK, the focus and solution is seen as exiting the EU free trade zone. In the US, however, it's not possible for a given 'state'
to leave the USA, as it is for a 'state' like the UK to leave the EU. And there are no national referenda possible constitutionally
in the US.
The solution in the US is not to build a wall to keep immigrants out, but to tear down the Free Trade wall that has been erected
by US neoliberal policies in order to keep US jobs in. Trump_vs_deep_state has come up with a reactionary solution to the free trade-immigration-economic
nexus that has significant political appeal. He proposes stopping labor flows, but proposes nothing concrete about stopping the cross-country
flows of money, capital and investment that are at the heart of free trade.
One of the most best stories so far, both from the perspective of the granularity of the reporting and the caliber of the writing,
is the Guardian's
'If you've got money, you vote in … if you haven't got money, you vote out' (hat tip PlutoniumKun). It gives a vivid, painful
picture of the England that has been left behind with the march of Thatcherism and neoliberalism.
From the article :
And now here we are, with that terrifying decision to leave. Most things in the political foreground are finished, aren't
they? Cameron and Osborne. The Labour party as we know it, now revealed once again as a walking ghost, whose writ no longer
reaches its supposed heartlands. Scotland – which at the time of writing had voted to stay in the EU by 62% to 38% – is already
independent in most essential political and cultural terms, and will presumably soon be decisively on its way…
Because, of course, this is about so much more than the European Union. It is about class, and inequality, and a politics
now so professionalised that it has left most people staring at the rituals of Westminster with a mixture of anger and bafflement.
Tangled up in the moment are howling political failures that only compounded that problem: Iraq, the MPs' expenses scandal,
the way that Cameron's flip from big society niceness to hard-faced austerity compounded all the cliches about people you cannot
trust, answerable only to themselves (something that applied equally to the first victims of our new politics, the Liberal
Democrats).
Most of all, Brexit is the consequence of the economic bargain struck in the early 1980s, whereby we waved goodbye to the
security and certainties of the postwar settlement, and were given instead an economic model that has just about served the
most populous parts of the country, while leaving too much of the rest to anxiously decline. Look at the map of those results,
and that huge island of "in" voting in London and the south-east; or those jaw-dropping vote-shares for remain in the centre
of the capital: 69% in Tory Kensington and Chelsea; 75% in Camden; 78% in Hackney, contrasted with comparable shares for leave
in such places as Great Yarmouth (71%), Castle Point in Essex (73%), and Redcar and Cleveland (66%). Here is a country so imbalanced
it has effectively fallen over….
What defines these furies is often clear enough: a terrible shortage of homes, an impossibly precarious job market, a too-often
overlooked sense that men (and men are particularly relevant here) who would once have been certain in their identity as miners,
or steelworkers, now feel demeaned and ignored. The attempts of mainstream politics to still the anger have probably only made
it worse: oily tributes to "hardworking families", or the the fingers-down-a-blackboard trope of "social mobility", with its
suggestion that the only thing Westminster can offer working-class people is a specious chance of not being working class anymore.
This much-watch segment with Mark Blyth (hat tip
Gabriel U) also focuses on the class warfare as a driver of the Brexit vote and how that plays into the broader EU political and
economic context:
Our Richard Smith echoed these themes from his own observations:
In (for instance) North Lincolnshire, manufacturing is most likely to be the biggest EU export. That might get nuked a bit
if the terms of trade with EU countries get stiffer.
But the locals upcountry clearly feel they have been ignored, and now have nothing to lose. M and I bumbled through Wisbech
and Boston a few years ago, expecting cute East Anglian port towns, and found instead murderously tense run-down ghettoes.
You get this kind of story:
Unless, improbably, around 700,000 such stories turn up, which would imply they swung the vote, this is another portrayal
of the "Leave" voters as idiots.
Brexit's lesson for the US - and other democracies - is that fear mongering is not enough. Western elites must build a positive
case for reforming a system that is no longer perceived to be fair. The British may well repent at leisure for a vote they
took in haste. Others can learn from its blunder.
But even this is weak tea. Luce isn't advocating a Sanders-style economic regime change. Indeed, his call for action is making
a case for reform, implying that the more realistic members of the elites need to take on the reactionary forces. As we've said,
the Clintons are modern day Bourbons: they've learned nothing and forgotten nothing. Luce's warning to Hillary Clinton, firmly
ensconced in her bubble of self-regard, deeply loyal to powerful, monied interests and technocrats, is destined to fall on deaf
ears.
"... This neoliberal ideology died already in 2008 and is kept alive artificially, it's Frankenstein ideology. ..."
"... Certainly something very wrong with a system that sees a larger and larger share of our national wealth going to fewer and fewer people. ..."
"... We're not quite there yet, but with the dawn of the information age, and the flow of information about how so called perfect "free"!markets are so recklessly constructed, controlled - not to mention generally to the benefit of those already with more than enough - it can't be long before we move on from this ridiculous charade to something altogether more intelligent. ..."
"... the word "mature" was hiding complete irresponsibility of driven sociopaths. The usual confidence trick...: " don't you trust me, me the caring man !" ..."
"... So do you think neoliberalism could adapt away from just focusing on growth, in its almost certain attempts at clinging to power? ..."
"... Neo-liberalism is just another failed attempt but has perhaps been the most successful so far out of the different ideologies. ..."
"... the lack of factual evidence demonstrating the utility of privatization remains one of the most telling aspects of its failure. ..."
"... The economists at the IMF - like most of their colleagues elsewhere in this dismal profession - have an unsullied track record of getting everything wrong. Why would they be right about this? ..."
"... Neo-liberalism is bankrupt and austerity is the economic equivalent of a severely self-destructive bipolar personality disorder ..."
"... Even when the British Empire was at its high point, there were still slums and poverty. Now the world population has gone up hugely India and China are huge consumers and so is the rest of the world. People are living much longer and have to be cared for. At the same time the food sources in the seas and land are being used up and their eco systems destroyed. Not to mention climate change and many other things that would take pages to write about. Yet we expect our standards of living to improve or at least be maintained. The outlook is not favorable, under any system of government. ..."
"... I don't think the obsessions of endless growth and financialism are going to disappear within this century, but they're almost certainly going to have to downsize ambitions and take a more sustainable place alongside the state and ever increasing non-market-non-state sectors. Either that or party up with the proponents of soft totalitarianism. ..."
"... Neoliberalism is just Laissez-faire capitalism renamed. In-between the two we had welfare capitalism, or social democracy as some call it, that arose as a response to the crippling societal problems caused by neoliberalism - mass poverty, disease, economic collapse and war. As soon as some welfare reforms were put in place, using public money to provide stability for people, they were under attack by capitalists who have a pathological need to glean personal profits from anything and everything. So we came full circle, back round to Laissez-faire capitalism. ..."
"... The history of capitalism is one of rapacious greed, intermittently tempered with redistribution policies when the either the elites cannot profit further without some form of redistribution taking place or they fear the pitchforks at the door. Capitalism cannot be fixed, it cannot be tempered, it will always end up back like this, as capitalism is the crisis. History shows us that accepting reform of the system only ever provides a fleeting fix, we need a new economic model entirely, capitalism has to end. It's not just a human issue, but for the sake of all life on Earth, we need an entirely different economic model. ..."
"... The failure of an ideology premised on something that doesn't even exist (free-markets) should be of no surprise. Market ideology was built around a crackpot idea of capital flows, concomitant with rational individual 'self interest', behaving like a self-regulating eco-system. Just remove as much government, regulatory framework and hierarchy as possible, and let eco-Gaia set the natural balance. ..."
"... The people promulgating this quixotic nonsense ranged from fugitives from totalitarian regimes like Hayek (whose motives for imagining a utopian fantasy land were at least understandable); to right-wing politicians who at root believed in anything but individual freedom. Thus, state spending increased under Reagan (except on the wealthier section of society), and the global free-market became a centrally-planned oligarchy. Furthermore, so much capital has become securitized that 'trickle-down' can no longer be taken seriously as a concept. ..."
"... "Mass privatization not only does not deliver on its own terms, but is fundamentally anti-democratic." ..."
"... While even Guardian columnists (the Guardian being a leading Neoliberal voice) talk prematurely about the downfall of Neoliberal ideology the fact is that the EU is so thick with Neoliberals hand picked by Merkel, and Germany/Merkel's unchallenged hegemonic power over the EU it could take decades to change the people at the top and decades more to change the bureaucracy of the EU. ..."
"... The world has a very serious problem on its hands. Vast wealth has been accumulated by the oligarchs they have taken this wealth in the same way the Porsche family has taken billions from VW - every penny of which they get to keep in spite of it having been earned from fraud and racketeering. Huge amounts of oligarch wealth has been extracted by such illegal means. ..."
"... Leave those fortunes in place and the same thing will happen that happened after the "reforms" of the New Deal - the oligarchs pay higher taxes for a brief time until they bribe and blackmail themselves back into control and it all starts again. ..."
"... In the 70s, though, there was much more pluralism in economics. Although neoliberalism was hardly mainstream, it did have respected proponents and prestigious econ. departments were teaching it. Today that is not the case- 'economics' is taught as if the word referred to the neoclassical synthesis (from which neoliberalism is derived) alone, with all other traditions relegated to crank or historical curiosity status. There are very few respected universities where you can get an econ PhD and not produce work within the neoclassical framework (Utah being an honorable exception, as well as SOAS and City in the UK). ..."
"... The old orthodoxy wasn't Keynesian by 1970. Keynesian economics had been progressively abandoned after about 1960. If you look at the Lewis Powell Memo of 1971 you can see the fundamentals of Neoliberalism were all in place and the takeover was beginning. ..."
"... Only those who benefit from neoliberal dogma support it. It tends to screw everybody else over. ..."
"... Neoliberalism seems to involve sacrificing anything and everything society has to give on the altar of "growth", which is what keeps derivatives markets profitable for the 0.0001%. ..."
"... What a dreadful mess my generation has made of the world, the irony being that we are beginning to value more highly the intangible values we have lost than the gadgets we have created. It's beginning to appear that revolution is the only cure. ..."
"... As I recall the 60's was the real start of "consumerism" with the ending of postwar austerity and the popularity of Hire Purchase, expansion of home and car ownership, people renting TV's buying washing machines, fridges and starting to take foreign holidays. ..."
"... The world changed in 2008 just as in 1929 and 1973: an economic orthodoxy ran out of steam. We have yet to decide on an alternative, hence the interregnum, but the first thing to change is, as ever, discourse, because, like J.M.Keynes before them, the IMF, World Bank et al see their mission as saving Capitalism. Neoliberalism can be sacrificed as yet another false God, a discredited version of Capitalism, a virulent strain, a form of fundamentalism. ..."
"... Unfortunately the real world does not conform to this free market libertarian fantasy. When China refused to buy its exports, Britain sent in its gunboats to force them to buy ..."
"... If someone admits that they murdered someone, it doesn't mean that they cease to be a killer or that they can be forgiven and can now be trusted, the likelyhood is that they are simply sociopathic in nature. It was just a moment of reflection, or is it that they are trying to regain trust, if anything one should be on a higher level of alertness, the distraction has been made, now we must wait for their next move. ..."
"... Great, thought provoking article. It raises the notion that neoliberalism has failed because it has only benefited an elite few whilst everyone else is worse off. Maybe that isn't a failure though? Maybe that's what it is meant to do? ..."
"... Of course it was meant to do just that. Neo-liberalism is class warfare..... the rich and privileged won so decisively that I doubt we can emerge from neo-liberalism without violence or at least a period with populist autocratic governance. ..."
"... Thatcher, Reagan - both arch-disciples of Hayek and others of the Austrian & Chicago schools of economic shite, and both massively responsible for it being liberally spread across the world. Would have been nice to see a recognition of their roles in this, along with the second wave of Clinton & Blair, with their "third way" economic take on the same models. ..."
"... And now we have Hilary as a contender for the presidency, as orthodox a neolib bag carrier as they come, and someone who will continue to carry the torch for Bills policies. Failing that, we have the absolute lunacy of Trump to look forwards to, and as a man who so obviously worships at the alter of Mammon, no game changers from him to be expected either. ..."
"... Neoliberal ideology has been an instrument for justifying the growing wealth and power of financiers and global corporations for about 40 years. They are highly unlikely to want to let go their gains, so reports of the impending 'death' of neoliberalism are a bit premature. The fact that this comes from the IMF makes me wonder if it isn't another ploy to divert attention from the ongoing process of wealth consolidation by making us think that a big change in policy is just around the corner. Ostry is an excellent scholar who has written some good papers warning about inequality and I have no doubt that he wants to influence decision-making. But it may be that he is being used as a 'useful idiot' by the powers that be. ..."
"... Neoliberalism has turned out to be similar in many ways to a better connected and more efficient form of feudalism. Great for those with power, greed and wealth and very much at the expense of everyone else. Perhaps newspapers and mass media have replaced swords, so it is an improvement in some ways. ..."
"... It strikes me that rather than "neoliberalism having failed", the most striking movement since the 1960ies is how private capital managed to bend democratic socialism (which means the welfare state in its various incarnations including in the USA) and bend it to its own profit. ..."
"... 'Neo-liberalism' or free market capitalism will die when a better alternative system is seen to be superior. As the article says there was a time when sensible people could believe that this better alternative was Marxian socialism. Sixty odd years later it is impossible to believe that. The remaining examples in the world like North Korea and Venezuela are to be avoided like the plague and previously socialist countries like China and Vietnam have longed eased to be so. ..."
"... So this was the reason for the death of the Ancien Regime in France and the death of the Romanovs? I think people were not going to wait for an alternative to come along. ..."
"... The same was thought/proclaimed about slavery, feudalism, colonialism. But new systems are born as the old ones become obsolete and an impediment to progress. Capitalism will go the same way. ..."
"... Free markets without state interference invariably drift towards feudalistic monopolies. They end up exactly where communism also ends up. A small elite controlling the economic fate of the masses. A "market" where supply and demand no longer play any part, because any small competitor can be bought or liquidated at will by the monopolist. ..."
"... Galbraith had seen this. He said that neoliberalism was like feeding the finest oats to the stallion in the hope it would generate some undigested droppings on which the sparrow could feed. ..."
"... The Achilles heel of neo-liberalism was that it over emphasized the supply side. Costs had to be driven down by emasculating Trade Unions, curbs on workers bargaining power were introduced and salaries plummeted, government services had to be cut with direct consequences on jobs and quality of life and, taxes to the rich were simultaneously cut exacerbating income inequality. ..."
"... Soviet state socialism lied, because it pretended to be a necessary step on the way to common ownership of the means of production: but instead fell into the hands of uncompromising thugs. It failed because the neoliberal capitalist system is a far more efficient way for uncompromising thugs to run things. ..."
"... The state has been militarised to such an extent armed revolution is all but impossible. What really terrifies them is that we will simply ignore them and create our own alternatives. Take Argentina in 2001 as an example. It was the only country in history to default on it's debt due to popular revolt. The revolt in question centered on people forming alternative social and economic services in their own communities around the rallying cry of "Que se vayan todos" or they can all go to hell. There are a few books published under that title about it that are free online. Similarly, have a look at this vid from David Graeber. You can start at 2:56 for a direct answer but it's worth watching the whole thing: https://youtu.be/mU1pQIMv8_A ..."
"... The dominant neoliberal, market fundamentalist order must, like any competent cult, enforce its authority by doubling down each time its worldview is threatened. This is accomplished by identifying and monetizing regions of social life that had hitherto been neglected or underutilized. In the latest sting, the student is reduced to the status of a consumer whose actions and decisions are governed purely by the market algorithm. The reduction must be so complete that the student-consumer identity should appear obvious and unquestionable. ..."
"... The captured organs of government managed to again bail out the big speculators and players, privatizing their gains during the expansion of the bubble and socializing their losses during its bust. In other words, a smooth operation of radiating risk from high-stakes gamblers and scammers to the society at large. However, the ripple effects of the latest crash have not been completely damped out and, if anything, the magnitude of the shock waves keeps increasing after each manifestation of discontent and protest against the neoliberal machine. ..."
In the IMF's flagship publication, three of its top economists have written an essay titled "
Neoliberalism: Oversold ?".
The very headline delivers a jolt. For so long mainstream economists and policymakers have denied
the very existence of such a thing as neoliberalism, dismissing it as an insult invented by gap-toothed
malcontents who understand neither economics nor capitalism. Now here comes the IMF,
describing
how a "neoliberal agenda" has spread across the globe in the past 30 years. What they mean is
that more and more states have remade their social and political institutions into pale copies of
the market. Two British examples, suggests Will Davies – author of the
Limits of Neoliberalism – would be the NHS and universities "where classrooms are being transformed
into supermarkets". In this way, the public sector is replaced by private companies, and democracy
is supplanted by mere competition.
The results, the IMF researchers concede, have been terrible. Neoliberalism hasn't delivered economic
growth – it has only made a few people a lot better off. It causes epic crashes that leave behind
human wreckage and cost billions to clean up, a finding with which most residents of food bank Britain
would agree. And while George Osborne might justify austerity as "fixing the roof while the sun is
shining", the fund team defines it as "curbing the size of the state … another aspect of the neoliberal
agenda". And,
they say , its costs "could be large – much larger than the benefit".
Two things need to be borne in mind here. First, this study comes from the IMF's research division
– not from those staffers who fly into bankrupt countries, haggle over loan terms with cash-strapped
governments and administer the fiscal waterboarding. Since 2008, a big gap has opened up between
what the IMF thinks and what it does. Second, while the researchers go much further than fund watchers
might have believed, they leave in some all-important get-out clauses. The authors even defend privatisation
as leading to "more efficient provision of services" and less government spending – to which the
only response must be to offer them a train ride across to
Hinkley Point C .
Even so, this is a remarkable breach of the neoliberal consensus by the IMF. Inequality and the
uselessness of much modern finance: such topics have become regular chew toys for economists and
politicians, who prefer to treat them as aberrations from the norm. At last a major institution is
going after not only the symptoms but the cause – and it is naming that cause as political. No wonder
the study's lead author says that this research wouldn't even have been published by the fund five
years ago.
From the 1980s the policymaking elite has waved away the notion that they were acting ideologically
– merely doing "what works". But you can only get away with that claim if what you're doing is
actually working. Since the crash, central bankers, politicians and TV correspondents have
tried to reassure the public that this wheeze or those billions would do the trick and put the economy
right again. They have riffled through every page in the textbook and beyond – bank bailouts, spending
cuts, wage freezes, pumping billions into financial markets – and still growth remains anaemic.
And the longer the slump goes on, the more the public tumbles to the fact that not only has growth
been feebler, but ordinary workers have enjoyed much less of its benefits. Last year the rich countries'
thinktank, the OECD, made a
remarkable concession . It acknowledged that the share of UK economic growth enjoyed by workers
is now at its lowest since the second world war. Even more remarkably, it said the same or worse
applied to workers across the capitalist west.
Red Plenty ends with Nikita Khrushchev pacing outside his dacha, to where he has been forcibly
retired. "Paradise," he exclaims, "is a place where people want to end up, not a place they run from.
What kind of socialism is that? What kind of shit is that, when you have to keep people in chains?
What kind of social order? What kind of paradise?"
Economists don't talk like novelists, more's the pity, but what you're witnessing amid all the
graphs and technical language is the start of the long death of an ideology.
The introduction of A.I and robotic technology will probably kill off capitalism for good, particularly
if the threat of job losses is realised. those with disposable income will just save, unwilling
to commit to purchases for fear that they too will be soon losing their jobs.
Those who have lost their jobs won't buy anything other the most basic necessities.
The failure to comprehend the most basic requirements of capitalism; that people require jobs
and a disposable income to actually buy things will be the final downfall, and the robots
will sit rusting and covered in dust.
When the capitalist ideologists whooped with joy and declared that socialism was dead back in
1990, I whispered to myself that, well, sure, everything passes, and neo-liberal capitalism would
be next then. I reckoned about 25 years would do it, more or less. We're not quite there yet,
but with the dawn of the information age, and the flow of information about how so called perfect
"free"!markets are so recklessly constructed, controlled - not to mention generally to the benefit
of those already with more than enough - it can't be long before we move on from this ridiculous
charade to something altogether more intelligent.
For those of us that have been highlighting the shortfalls of the Neo-Liberal agenda this does
not come as a surprise, but the question others should ask themselves is, when the impact of what
they were doing was so evident why do they still persist?
The answer is self evident, the people who benefit are not the ones suffering from their policies.
Money and power has migrated upwards just as happened in Dickens time, and the real story behind
the agenda is control of the masses using poverty and ignorance so that the few can continue to
accumulate more and more at our expense.
To say that the great unwashed should wake up and smell the coffee has been said before, but
will always be the case,whilst people earning low wages and jobs are in short supply.
The Bankers make profits from lending, people with savings do not borrow and the banks pay
out interest on their accounts, the banks only like people to be poor as they are forced to borrow
and pay interest, making them profit.
Those same banks though print money out of thin air, every time they make a loan, isn't it
time people woke up and realised that we can use that money more efficiently by creating jobs
and infrastructure spending, rather than trapping people into eternal debt.
This is the 21st century not the 1800s, why do people not see what is going on around them
and why are they trapped like rabbits in the headlights, when the solutions rest in their hands?
Jeremy Corbyn is light years ahead of public opinion, isn't it time to start asking what the
meaning of Peoples QE is?
Lets start asking him instead of believing lying Neo-Liberals that have crashed the world economy.
A good article-If further insight is needed into Neo Liberalism, I would suggest watching, The
Mayfair Set as well The Power of Nightmares.
Two excellent Adam Curtis Films which go toward explaining how and why we arrived at where we
are today.
So do you think neoliberalism could adapt away from just focusing on growth, in its almost
certain attempts at clinging to power? And would they tell us about it? Openly? (*collapses
in first giggles of the day*)
Outside of the political elites and the cosy little Guardian CIF club, most people can't spell
neoliberalism, let alone know what it means. The average person, neither know or cares about growth
etc.
What matters is whether they have a job, taxes, how pay rises compare to inflation and are
the schools, health services and council services functioning? And in that respect, by and large
they are ok, albeit sometimes held together with sticking plaster.
They are more likely to be concerned about immigration than neoliberalism, but that is a taboo
subject in political circles.
You have a point but years with no pay rises and the decomposition of public services does penetrate.
The political sands are moving about but where they will come to rest is anyone's guess.
Because those elites constantly tell the that immigrants are the cause of all their woes whilst
removing any semblance of a safety net from them. People aren't stupid they just don't have the
time or energy to go digging for more complicated answers.
Say what? The ultra-ultra rich have realized that when there are only poor people left, they won't
be able to squeeze any more money out of them? And look at Christina's outfit in that picture
- the cost would support a family of five for a year in the US. I think they're just trying to
figure out how to create more money without losing any for themselves. Business as usual.
I stopped reading when I got to "The results, the IMF researchers concede, have been terrible.
Neoliberalism hasn't delivered economic growth – it has only made a few people a lot better off."
They have riffled through every page in the textbook and beyond – bank bailouts, spending
cuts, wage freezes, pumping billions into financial markets – and still growth remains anaemic.
I have always been skeptical of the idea that we need perpetual growth and have wondered whether
it is desirable or achievable ?
In reality I think most people will be relatively happy if they have the basics of a roof over
their head , enough food to eat a job which is not too time consuming ,monotonous or backbreaking
and some time for themselves to enjoy their own entertainments outside of work.
Why we need to have perpetual growth to achieve this state of affairs and why we need to continually
keep on producing and consuming more and more has always been a bit of a mystery to me ?
Surely things could be organised better and more sustainably and resources shared out more
equably to give a more contented and harmonious society . Of course many people have thought the
same but neither communism or capitalism has really managed to get it right yet. Neo-liberalism
is just another failed attempt but has perhaps been the most successful so far out of the different
ideologies.
I have always been sceptical of the idea that we need perpetual growth and have wondered
whether it is desirable or achievable ?
Desirable depends on what you want to achieve. If you want to be better off there's 2 options
1/ Grab a bigger slice of the same sized pie - this can get you a lot better off quickly but somebody
else loses out
2/ Have the same sized slice of a bigger pie - this will get you gradually better off year by
year but nobody else loses out.
Doing 1/ is what rich people are good at, that's how they get richer. Doing 2/ is how lower/middle
income people get better off.
So yes you would need growth to support middle income people, they usually can't do 1/.
The sooner we can break the neoliberal consensus, the better. I do find it incredible, but also
reassuring, to see the IMF using this language though, even as they defend privatization without
any kind of factual evidence to back it up. Indeed, the lack of factual evidence demonstrating
the utility of privatization remains one of the most telling aspects of its failure.
Perhaps a slightly older set of ideas regarding the role of the state and of capitalism should
be considered? A few years ago there was a rather interesting government report on the topic:
The economists at the IMF - like most of their colleagues elsewhere in this dismal profession
- have an unsullied track record of getting everything wrong. Why would they be right about this?
Neo-liberalism is bankrupt and austerity is the economic equivalent of a severely self-destructive
bipolar personality disorder..... yes, we know that; that's hardly news, but the idiots worshiping
neoliberalism wont go voluntarily nor will they be booted out anytime soon. They will hang on
even after the next major crash; trying one last desperate round of bailing out the financial
gamblers.
People with access to the media, like Chakrabortty here, must start advocating specific alternatives.
We don't see much of that in the Graun....... mostly it's just complaints the traditional approach
doesn't work.
Spot-on! Gives them too much power, as defined in dollars and sterling...while, at the other end,
the consumoron is both constructed and blinded at the same time, by this very power...
Even when the British Empire was at its high point, there were still slums and poverty. Now
the world population has gone up hugely India and China are huge consumers and so is the rest
of the world. People are living much longer and have to be cared for. At the same time the food
sources in the seas and land are being used up and their eco systems destroyed. Not to mention
climate change and many other things that would take pages to write about. Yet we expect our standards
of living to improve or at least be maintained. The outlook is not favorable, under any system
of government.
The sooner we can break the neoliberal consensus, the better. I do find it incredible, but also
reassuring, to see the IMF using this language though, even as they defend privatization without
any kind of factual evidence to back it up. Indeed, the lack of factual evidence demonstrating
the utility of privatization remains one of the most telling aspects of its failure.
in theory the premise behind neoliberalism is a good idea i.e. to create competition and avoid
monopolies, but in practice and as Marx predicted corporations either sink or buyout the competition
and you're left with monopolies.
Neoliberalism is dead, its policy of greed and short-termism has ensured that.
And the trouble with competition in many sectors is that you spend a lot of time and money working
to increase market share and less on actually serving customers/ clients.
I think this is the key point; 'From the 1980s the policymaking elite has waved away the notion
that they were acting ideologically – merely doing "what works". But you can only get away with
that claim if what you're doing is actually working.' Given current predictions, it's hard to
imagine how our neoliberal form of capitalism will manage to adapt without resorting to directly
attacking democracy itself, and doing some hardcore Pinocheting.
I don't think the obsessions of endless growth and financialism are going to disappear
within this century, but they're almost certainly going to have to downsize ambitions and take
a more sustainable place alongside the state and ever increasing non-market-non-state sectors.
Either that or party up with the proponents of soft totalitarianism.
Neoliberalism is just Laissez-faire capitalism renamed. In-between the two we had welfare
capitalism, or social democracy as some call it, that arose as a response to the crippling societal
problems caused by neoliberalism - mass poverty, disease, economic collapse and war. As soon as
some welfare reforms were put in place, using public money to provide stability for people, they
were under attack by capitalists who have a pathological need to glean personal profits from anything
and everything. So we came full circle, back round to Laissez-faire capitalism.
The history of capitalism is one of rapacious greed, intermittently tempered with redistribution
policies when the either the elites cannot profit further without some form of redistribution
taking place or they fear the pitchforks at the door. Capitalism cannot be fixed, it cannot be
tempered, it will always end up back like this, as capitalism is the crisis. History shows us
that accepting reform of the system only ever provides a fleeting fix, we need a new economic
model entirely, capitalism has to end. It's not just a human issue, but for the sake of all life
on Earth, we need an entirely different economic model.
I am puzzled. Just about everyone agrees that there is too much debt around and another financial
crash is inevitable.
But many talk about debt as though it is some form of negative money, of course it is not,
it is just a contractual commitment. Who ultimately are the beneficiaries of all this debt ?
Sounds like a Debt Jubilee all round would be a good idea. Why has it not happened? Without
knowing who would lose out you can't tell.
Because it would utterly destroy financial institutions and investors who have purchased large
swathes of private and national debt. They'd be short cash big time! Of course you and I would
say to hell with them, but these are the guys (and let's face it, they're mostly guys) who hang
out in the gentleman's clubs or tennis clubs or golf clubs or country clubs and who donate political
parties. The old boy network type of thing. They will never allow that to happen, never.
I'm so glad to see articles like this being published. I've been tracking the decline in our American
system for several years with some real alarm. Our current gaggle of morons running for President
is a great example of how our neoliberals have failed to notice their policies are destroying
the base of the economy. They may end up with most of the wealth, but it won't do them any good
if the dollar takes a plunge and/or the oceans swamp cities like New York and Washington D.C.
It's insane that it will take a global sized calamity before the people decide to remove those
in power from power while we still can. Sadly, we are in fact headed for just such a perfect storm
of global calamities.
The failure of an ideology premised on something that doesn't even exist (free-markets)
should be of no surprise. Market ideology was built around a crackpot idea of capital flows, concomitant
with rational individual 'self interest', behaving like a self-regulating eco-system. Just remove
as much government, regulatory framework and hierarchy as possible, and let eco-Gaia set the natural
balance.
The people promulgating this quixotic nonsense ranged from fugitives from totalitarian
regimes like Hayek (whose motives for imagining a utopian fantasy land were at least understandable);
to right-wing politicians who at root believed in anything but individual freedom. Thus, state
spending increased under Reagan (except on the wealthier section of society), and the global free-market
became a centrally-planned oligarchy. Furthermore, so much capital has become securitized that
'trickle-down' can no longer be taken seriously as a concept.
Because, as a moderately intelligent child could tell you, a world without power structures
is impossible. Which is why the supremacy of democratically accountable governments (rather than
antidemocratic multi-national corporations) is imperative. Mass privatization not only does not
deliver on its own terms, but is fundamentally anti-democratic. No one supporting the neoliberal
project, which has eventuated in corporate feudalism, can legitimately call themselves a libertarian.
I haven't seen the evidence that Neoliberals are akin to libertarianism. Although they may have
tried to use it politically to get votes in silicon valley. Frankly, I find it hard to believe
that the extreme concentration wealth at the top was the goal all along and the Neoliberals have
been very successful at it.
While even Guardian columnists (the Guardian being a leading Neoliberal voice) talk prematurely
about the downfall of Neoliberal ideology the fact is that the EU is so thick with Neoliberals
hand picked by Merkel, and Germany/Merkel's unchallenged hegemonic power over the EU it could
take decades to change the people at the top and decades more to change the bureaucracy of the
EU.
The world has a very serious problem on its hands. Vast wealth has been accumulated by
the oligarchs they have taken this wealth in the same way the Porsche family has taken billions
from VW - every penny of which they get to keep in spite of it having been earned from fraud and
racketeering. Huge amounts of oligarch wealth has been extracted by such illegal means.
Leave those fortunes in place and the same thing will happen that happened after the "reforms"
of the New Deal - the oligarchs pay higher taxes for a brief time until they bribe and blackmail
themselves back into control and it all starts again.
There is simply no way to reform economies and allow the rich to remain rich.
I would like to think that we are experiencing a repeat/mirror of what happened to economic ideas
in the 70s. Then it took the whole decade of crisis and stagnation for the old orthodoxy of Keynesianism
to be abandoned in favour of neoliberalism.
In the 70s, though, there was much more pluralism in economics. Although neoliberalism
was hardly mainstream, it did have respected proponents and prestigious econ. departments were
teaching it. Today that is not the case- 'economics' is taught as if the word referred to the
neoclassical synthesis (from which neoliberalism is derived) alone, with all other traditions
relegated to crank or historical curiosity status. There are very few respected universities where
you can get an econ PhD and not produce work within the neoclassical framework (Utah being an
honorable exception, as well as SOAS and City in the UK).
So, a paper like this one from the IMF's research department is hailed as a significant moment,
but its critique of neoliberalism is mild and limited, necessarily so because it works with the
same basic assumptions as neoliberalism itself.
There are interesting figures with some influence around (e.g Ha Joon Chang, Justin Lin). In
general, though, the unwillingness of the economics discipline to even acknowledge the existence
of plausible alternatives to their own favoured models has produced widespread intellectual poverty
and rigidity. Proposals for true alternatives will tend to fall on deaf ears, though few now have
the tools and imagination to produce them in any case.
The old orthodoxy wasn't Keynesian by 1970. Keynesian economics had been progressively abandoned
after about 1960. If you look at the
Lewis
Powell Memo of 1971 you can see the fundamentals of Neoliberalism were all in place and the
takeover was beginning.
But I totally agree on the potential impact of the IMF paper. A generation of economists, politicians
and (crucially) journalists have been taught that economics is neo-classical economic and
that there is no alternative. So there is not yet anything like a successful critique of the Big
Lie.
Neoliberalism seems to involve sacrificing anything and everything society has to give on
the altar of "growth", which is what keeps derivatives markets profitable for the 0.0001%.
That philosophy includes actively encouraging uncontrolled immigration. Blair, Brown, Cameron
and Clegg would all be happy to see a 10% rise in population if it gives a 2% increase in GDP.
They don't care that the real-world effect of that is to make the average Brit poorer. As long
as the markets stay profitable for their chums.
Yes the focus on GDP as a marker of 'success' is deeply problematic. Especially as the average
voter believes that increasing GPD equals better living conditions for householders generally.
The reality of course, is very different.
The next thing is what interests me. One of the effects of neoliberalism has been to create a
stressed out competitive society where most people feel insecure and have a tendency to drink
too much or otherwise distract themselves from the presented reality. This combination of powerlessness
and pressure to perform is, I believe, what lies behind the rise of far right politics. At its
heart far right politics is more a desire to escape individualism by defining an idea of "us"
than it is about being nasty to "them". It is a desire to reclaim political, social and personal
power from a system that offers no hope beyond the prospect of the next i phone.
For many people who are too smart and well educated to become followers of the far right, it
is a matter of picking far right attitudes and putting them through a nice person's moderate filter.
The result is the Labour supporter who has "concerns" about Islam, accepts the UK is "full" and
thinks cuts are needed to discourage scroungers. Just as with the far right, their response to
living in failing neoliberalism is to see hope in rejecting "others".
We all know, from the experience 30's and 40's Europe how easy the rich find it to adjust to
far right politics. So while the far right are, for the moment, the leading contenders to inherit
the political space dominated by neoliberalism, the left must face off the rich, the far right
and sanitized far right thought in order to offer an alternative.
Leftist ideas and ideals are so broad in their scope that left unity is extremely difficult
to achieve and rarely converges into a set of coherent ideas, methods and objectives. It doesn't
matter that the left has the stronger intellectual and moral positions on most issues. Its inability
to apply the same intellect and morality to difficult issues like migration and come to a populist
conclusion obstructs its ability to access mass support. Its inability to address the conflicting
demands of wealth creation, social justice and the environment are not in reality weaknesses,
but are frequently perceived as such by those who focus only on wealth creation.
Just as the end of Soviet communism brought a difficult time for the people of the former Soviet
empire, we have little to look forward to in the fall of neoliberalism. It invites international
conflict and the worst form of politics and threatens to consign to the margins those who would
try to build a world economy that reconciles our shared needs with those of a finite planet.
In other words, Marx's 19th Century critique of capitalism is pretty much spot on. We really do
need some urgent answers but I fear we will not get them while party allegiance is prized over
free thinking. I thank my lucky stars I am middle aged and have at least experienced (in the 60's
and 70's) a world not so in thrall to consumerism and shallow self-interest. What a dreadful
mess my generation has made of the world, the irony being that we are beginning to value more
highly the intangible values we have lost than the gadgets we have created. It's beginning to
appear that revolution is the only cure.
As I recall the 60's was the real start of "consumerism" with the ending of postwar austerity
and the popularity of Hire Purchase, expansion of home and car ownership, people renting TV's
buying washing machines, fridges and starting to take foreign holidays.
Indeed, some of us have been making this argument since 2008 only to be pooh-poohed by columnists
and savants btl.
The world changed in 2008 just as in 1929 and 1973: an economic orthodoxy ran out of steam.
We have yet to decide on an alternative, hence the interregnum, but the first thing to change
is, as ever, discourse, because, like J.M.Keynes before them, the IMF, World Bank et al see their
mission as saving Capitalism. Neoliberalism can be sacrificed as yet another false God, a discredited
version of Capitalism, a virulent strain, a form of fundamentalism.
Capitalism is a consensual transaction. Someone makes something, you are free to buy it or not.
The worst scenario is you decide to purchase from someone else and one or other goes out of business.
Or, horror of horrors, make it yourself. No one is being forced to either buy or sell. Neo-liberals
are the extreme fringe of capitalism. Not representative of anything or anyone but themselves.
I can't think of a single truly socialist sate (if such a thing could ever exist) that ever
overproduced anything except grinding poverty and privation. Then attempt to sell the empty shelves
to the people as the healthy option, usually just before being run out of town. Socialism, is
however good in parts.
Capitalism is a consensual transaction. Someone makes something, you are free to buy
it or not.
Unfortunately the real world does not conform to this free market libertarian fantasy.
When China refused to buy its exports, Britain sent in its gunboats to force them to buy
The failure of neo liberal economics has been evident for some time. In the UK there are clear
market failures in education, transport, housing, energy and health. Yet the die hard neo liberal
ideologues continue to prescribe market mechanisms as the only way forward. It is disappointing,
however, that the voices putting forward an alternative are so quiet.
Those alternative voices are so quiet because the likes of The Guardian silence them or resort
to ridicule. Look at the treatment Corbyn has received at the hands of this 'newspaper'. He is
attempting to put forward alternatives that are really far from radical if you have lived in pre-neoliberal
times, and has been utterly condemned.
This just makes you aware of how poorly read and politically illiterate hacks are.
Everything goes in dogmatic cycles. After the war nationalisation , public ownership and controlled
economies (via wages prices and incomes policies) ruled the roost. All political parties adhered
to this "general consensus". But like all dogma's it ended up falling apart due to the paradoxes
and plain unworkability of it all. Then we've had "privatisation is best" dogma since 1979 ; private
is best, self regulation is best and so on and so on, and all political parties have adhered to
this dogma (Blair the most fanatical) and like all previous dogmas it is falling apart.
Private health etc was only 'better' when it had an excellent public health as the bench mark,
forcing them to improve to justify making people pay. Now there is no or poor public services,
private can-and does- offer any old shite at any price it cares to dream up. This would suggest
that Harold McMillan got it spot on in the 50's with his "Mixed economy-public and private-is
best"
All that is happening-and that politically illiterate hacks fail to spot-is that the latest
dogma has simply run its course. They fail to be saying that a return to -or even creation of-another
dogma will lead to another crash when it implodes in 40 years time. Bering "left wing" or "Eight
wing" they fail to be able to argue for what really serves us best. McMillans old mixed economy
(something he probably didn't fully realise himself at the time)
All we get though is the left or rights blinkered and harmful dogmatic drivels, bound to fail
So true. A little light reading of political theory and less obsession with party politics by
those in the media who seek to influence would serve the populace well. The problem is, it requires
a little application - so much easier to comment on Corbyn's dress sense or Boris Johnson's hair.
The final stages of capitalism, Marx wrote, would be marked by developments that are intimately
familiar to most of us. Unable to expand and generate profits at past levels, the capitalist system
would begin to consume the structures that sustained it. It would prey upon, in the name of austerity,
the working class and the poor, driving them ever deeper into debt and poverty and diminishing
the capacity of the state to serve the needs of ordinary citizens. It would, as it has, increasingly
relocate jobs, including both manufacturing and professional positions, to countries with cheap
pools of laborers. Industries would mechanize their workplaces. This would trigger an economic
assault on not only the working class but the middle class-the bulwark of a capitalist system-that
would be disguised by the imposition of massive personal debt as incomes declined or remained
stagnant. Politics would in the late stages of capitalism become subordinate to economics, leading
to political parties hollowed out of any real political content and abjectly subservient to the
dictates and money of global capitalism.
European Central Bank concur austerity is going to destroy the eurozone and EU economy, the greedy
bastards are only concerned now that it hurts them. Wikileaks transcripts of IMF/Germany discussion
imply that the IMF intended for Greece to collapse.
If someone admits that they murdered someone, it doesn't mean that they cease to be a killer
or that they can be forgiven and can now be trusted, the likelyhood is that they are simply sociopathic
in nature. It was just a moment of reflection, or is it that they are trying to regain trust,
if anything one should be on a higher level of alertness, the distraction has been made, now we
must wait for their next move.
Great, thought provoking article. It raises the notion that neoliberalism has failed because
it has only benefited an elite few whilst everyone else is worse off. Maybe that isn't a failure
though? Maybe that's what it is meant to do? It certainly feels like there's little impetus
or inclination from the those who've done very well out of neoliberalism to pull the plug on it
out of the 'goodness' of their hearts.
I believe the failure is that of a system which is supposedly supportive of society, allowing
flow of goods and services while protecting rights of individuals. The actual in-place system
is not the one the politicos advertise, a typical bait ans switch. Yes, the current system does
what it is designed to do: funnel money from the middle class to the ruling minority. It is not
designed to be sustainable, merely last long enough for one man to end up with 100% of the wealth.
That's the end game of this game. The problem is that governing is not a game and the events on
the horizon require a government of people, by people and for the people because corporations
do not support human life, they merely move money around.
Maybe that isn't a failure though? Maybe that's what it is meant to do?
Of course it was meant to do just that. Neo-liberalism is class warfare..... the rich and
privileged won so decisively that I doubt we can emerge from neo-liberalism without violence or
at least a period with populist autocratic governance.
Neoliberals can't see [Bretton] wood for the trees. Capitalist v Marxist? Boring. So ...pass the
dripping Martha for me stale bread. Can't last you know.
If you look at low growth worldwide. It really is a western disease, aside from failed states.
Could it not be that a majority of people in the West live a reasonably comfortable life and are
simply incapable of driving growth over 3% annually. How much shit do you need? You have a roof
over your head, maybe a car, a job that pays the bills and the basics, the odd holiday, decent
food to eat, reasonable health care provided. What else do you need? I don't think you can base
an economy on "wants" long term an expect anything other than low growth. I've meet a lot of people
in my life that are capable of driving themselves harder or smarter and earn substantially more
money, but they're comfortable or lazy and see no "need".
The essential failure of neoliberal theory lies in the notion that a free market is the second
form democracy: any domain in which people are free to make their own choices. It fails because
it assumes that, unlike the ballot in which all citizens take an equal share, that the market
exists in a context where everybody is equally rich. In that case and that case only, free markets
are a second form of democracy.
Neoliberalism is consequently a form of democracy in which people have a variable form of representation,
such that my vote could be worth 100th of yours or 100 times that of everybody else.
Neoliberalism would work if there was a mechanism to ensure wealth was more evenly distributed.
I think the ballot is generally a more viable proposition.
Wealth doens't only belong to individuals but to states,regions,cities,companies. That makes it
even more difficult to distribute it more evenly. In rich countries many basic needs are fulfilled
by those entities and not only by individuals,as unitedbynature notices. The drive to earn more
may only exist if those entities don't get too important.
In fact,neo-liberalism works pretty well. And a lot of opposition to it is ideological more than
practical.
The mantra of those attempting to prop up neoliberalism is that nothing can ever change and if
we ever attempt to change things then we are heading for disaster. A bit like the EU debate. A
storm whipped up to keep us in line. But there is always another way, another option, and if this
is not offered to the people then they will look for other options themselves that could lead
to disaster, namely the voting in of anti-establishment heroes like Trump.
That's true but its not how he is perceived in the US. Its the same type of thing with the rise
of the Far Right in Europe. Dissatisfaction with the current shower leading to potentially more
dangerous alternatives.
If only the current shower would take note of that and start representing their constituents
instead of taking advantage of them...
In the IMF's flagship publication, three of its top economists have written an essay titled
"Neoliberalism: Oversold?".
The very headline delivers a jolt. For so long mainstream economists and policymakers have
denied the very existence of such a thing as neoliberalism, dismissing it as an insult invented
by gap-toothed malcontents who understand neither economics nor capitalism. Now here comes
the IMF, describing how a "neoliberal agenda" has spread across the globe in the past 30 years.
What they mean is that more and more states have remade their social and political institutions
into pale copies of the market.
The IMF under Lagarde has long since become a political weather vane, tilting in the direction
of whatever theory happens to be fashionable. It should also be noted that academics will tend
to make an argument in order to stimulate a debate; it would be foolish to immediately assume
everything they have written is gospel (as has often been repeated during the referendum campaign,
remember they thought the UK should have joined the Euro).
There's no doubt "neoliberalism" has become a pejorative term, used by opponents of the free market
to decry its excesses. It used to mean a capitalist economy with strong state intervention, essentially
the same thing as a social democracy. It's now used to describe a laissez-faire capitalism associated
with rolling back any and all state provision of services. As with all such terms the definition
is slippery and not useful: it's delivered as an insult rather than a description of any particular
economic reality.
This is why "policymakers have denied the existence" of it. There is no "neoliberal agenda"
being persued by a conspiratorial cadre of western leaders. That's a desperate simplification
by people struggling to comprehend the vast proliferation of approaches to social democracy, with
a range of countries all attempting in good faith to find a useful balance between free market
capitalism and state intervention. Neoliberalism as Chakrabortty understands it exists only in
the minds of its detractors
I've never hear "It used to mean a capitalist economy with strong state intervention" before.
Neoliberalism is "what comes after liberalism" and refers to the Thatcher/Reagan axis following
the interventionist and statist seventies.
So pardon the blunt contradiction but neoliberalism is the opposite of what you say. It is
reducing the state's role in the economy to the absolute minimum, which is, ideally, merely as
the legal and executive power, and no economic role at all in business.
Control of economics to be entirely in public hands. Hence privatising everything, obviously.
"Laissez faire" economics has always been part of neoliberalism.
Why "neo": it means "new" as you know, and the "new" is because up until teh late seventies,
there was a tacit agreement between right and left that some essential industries should be run
by the state for national security and other reasons.
• Libertarianism: No state interference in individual private citizen's lives.
• Neoliberalism: As little state interference in the economy.
The first is a subset and extreme simplified case of the second, and makes one think of trappers,
the wild west, and Donald Trump. The second is a political system.
Thatcher, Reagan - both arch-disciples of Hayek and others of the Austrian & Chicago schools
of economic shite, and both massively responsible for it being liberally spread across the world.
Would have been nice to see a recognition of their roles in this, along with the second wave of
Clinton & Blair, with their "third way" economic take on the same models.
And now we have Hilary as a contender for the presidency, as orthodox a neolib bag carrier
as they come, and someone who will continue to carry the torch for Bills policies. Failing that,
we have the absolute lunacy of Trump to look forwards to, and as a man who so obviously worships
at the alter of Mammon, no game changers from him to be expected either.
So if we are, as this article claims, witnessing the death of neoliberalism, it is going to
be a long, slow, agonising death, with a lot of collateral damage as the body economic writhes
in its death throes. Oh dear, oh dear, oh fucking dear…..
Reagan and Thatcher spawned the neoliberal dystopia, Blair and Clinton carried on where they left
off and so it goes on. Democracy has been sold to the highest bidders, and with no real options
at the ballot box people are turning to extreme politics, those on the fringes, far right loons
like Trump.
In short - I despair.
Britain is a republic, rule of the few over the many.... USA is a not even a republic, but more
like an oligarchy as our election system has been corrupted by the Party and with the Supreme
Republican Court to back them up we steadily lose the rights and protections for the middle class.
The Constitution is the direct result of the 18th century ruling class hating the middle classes,
hating minorities and desiring a nobility class without a king to rule over them. Madison and
Jefferson adamantly despised the very concept of "democracy". This is how we ended up contemplating
a President Trump.
"Paradise," he exclaims, "is a place where people want to end up, not a place they run from.
What kind of socialism is that? What kind of shit is that, when you have to keep people in
chains? What kind of social order? What kind of paradise?"
The statement is thoroughly stupid. Consistent with Chrushov's mental capacity.
History evolves in a discontinuous manner. Any social-economic transformation is performed
by force and through a bloodshed, a civil war. This is simply a law of thermodynamics.
The best example: the huge butchery of religious wars in Europe of the 17th century which gave
rise to the era of Enlightenment and Progress. Because of it, we live immeasurably more comfortable
life than our ancestors. We were thereby kicked in this paradise.
You're mis-using themodynamics in "Any social-economic transformation is performed by force
and through a bloodshed, a civil war. This is simply a law of thermodynamics."
There's no relevance of thermodynamics there, even allowing for making an analogy.
Saying "All socio-economic change is violent" which is what you're saying there is a simply
opinion, and, incidentally, contradicted by historical fact. Propping it up with an arbitrary
reference to science does not help :)
Thermodynamics is about the transfer of heat and says three laws (1) energy is conserved (2)
Entropy always increases (3) Entropy is a constant at absolute zero.
(plus a zeroth law thich I forget).
A bit of a sideline, but I was watching TV yesterday and an ad caught my eye that I found fascinating.
It was for chocolate- cadburys or something like that.
Essentially, an animated lady was giving a talk about 'boring economic stuff' and as she talked
her face actually stretched and became distorted until the whole 'economic/ finance thing' was
abandoned in favour of eating chocolate bars. The narrator's voice was what I presume marketing
people think of as 'working class'.
what I took from the ad (I may be wrong) was a not so subtle message that 'boring' economics isn't
for the likes of us (ii.e. the masses), and we'd be better off stuffing our faces with chocolate
rather than thinking about 'hard stuff.'
I found it quite disgusting. Has anyone else seen this and, if so, what do you think?
Of course its possible that I'm a paranoid loon just a few steps away from hiding out in a bunker
and talking to a balloon with a face drawn on...
That's why they are changing the education system so radically, can't have the plebs thinking
for themselves can we ? They want just drone factories for the majority of the population.
Ironically R4 are doing a pretty good adaptation of Brave New World at the moment.
It appears that Osborne - with zero growth-rate, zero-inflation, zero wage increases - is trying
to give us that very paradise with a stagnant economy.
Yes neoliberalism has been oversold because neoliberalism is a catch-all. means nothing, basket
insult for all policies that liberals hate. Blair was apparently a neoliberal, but the state grew
under Blair and there was huge investment in public services. Take away the investment under Labour,
and the NHS really would be on its knees now.
Secondly, we are still in crisis following the crash, the worst economic reversal since the
Great Depression. nobody ever said it would be easy to climb out of this economic hole and the
doomsayers might like to compare the lot of the working classes in 2016 with the lot of the poor
in the 1930s, Perhaps Aditya would like to read Steinbeck to get a handle on what real poverty
is, or if it is too difficult a read, he might tune in to some episodes of the Waltons.
There are no real shocks in the IMF issuing papers challenging political or economic orthodoxy
- they do it all the time - and I seem to remember that Lagarde has long been a critic of Osborne's
policies; the IMF, on balance, are Keynesian in outlook.
If you want to nail the real custodians of what is termed neoliberalism, then you need to the
nail the EU. These are the technocrats who are running Europe for the benefit of the elites!
History books will one day refer to the "so called neoliberals who were, in truth, free market
capitalists packaged up under a new name." For your "Neoliberal" I offer you "New Labour" or "Snickers
bars" or "Starbursts".
An interesting piece. Though it fits into a recent pattern of the Guardian picking up on stories
that were in the FT a couple of days earlier.
Amusingly, in this case, the link to the IMF "oversold?" piece actually takes you to the FT's
paywall, when the original piece is
freely available
on their site.
What needs exposing is the purported 'pragmatism' promulgated by the likes of Blair and Clinton.
A centrist position of ideological neutrality is a myth. 'What works' has become a synecdoche
for what maintains the neoliberal model - which ironically, as the author explains, no longer
works.
A purely managerial, non-ideological perspective is impossible. Anyone advancing a non-ideological
world-view is a self-effacing ideologue. The best trick the devil ever played was to convince
you he doesn't exist.
I'm proud to call myself a social democrat, which in today's terms means I am far left.
I only care about what works.
David Owen of all people in an interview about the EU actually attacked New Labour for the
marketisation of the NHS. In fact they didn't invent it, but they continued it with gusto. It
doesn't work.
which ironically, as the author explains, no longer works.
It never worked.... not for one minute. It just seemed to work because first the nation states
were indebting themselves; then the private sector indebted itself and everyone. The "success"
of neoliberalims was based on credit expansion all the time.
The model was always to enrich those at the top, while the unemployed lazy bastards
at the bottom were stressed more and more to create a race to the bottom for the desperate and
money less. The insanity of this policy, which took enormous amounts of money out of circulation
was glossed over for decades by the never-ending expansion of credit. The credit expansion kept
the middle class out of harms way thereby securing the political support to simply continue......
but keeping the middle class away from economic harm will end as soon as credit can no longer
be expanded.
I cannot believe Guardian readers spend so much time contemplating their navels. No wonder Labour
party is in such a mess. Believe in Britain....regain control of our money, borders and democracy!!
I'm afraid you're looking in the wrong place if you want us to 'regain control of our money'-
it's actually the commercial banks in the City that have us by the knackers... assisted by action
or inaction their political wing the Tory party. Google 'Positive Money' for starters.
As with many problems we have in the UK, blaming the EU is either a deliberate red herring
or just plain ignorance.
If we do not contemplate it them whom? This incessant need for 'growth' is a myth. How far can
we grow? By it's very definition to continue with this mad strive for a wealthier state is at
the expense of other states. There is PLENTY to go around but the current neoliberal philosophy
has simply moved it to a few. Borders an illusion, there is only one planet and it is dying because
of the neoliberal agenda for 'growth'. Democracy, in it's current form, is also an illusion. How
can we be democratic when the state watches our every move, email, phone call and browsing history.
Surly democracy should include some element freedom. Money is an illusion. The central banks print
money to order, quantitative easing, bank bailouts, offshore tax havens. When the money is printed
it immediately has a cost, a promise to pay bond yeilds as an element of its creation. So all
money is debt. We live in an insane world with systems that will ultimately be our doom.
Yes, an excellent film . The EU in its current form has turned into a tool to circumvent national
parliaments and to achieve legislation which is good for you and me and others. You can pass any
law you want, if you bribe the right people. That said, we need a strong EU parliament and an
informed audience to stop this. If necessary, Brexit could serve a wake up call, but the preferred
way should be to hold these guys accountable.
What disappoints me most about the current political situation is Jeremy Corbyn. It is not that
I disagree with much of his economic policy (not that we know a huge amount about it) it is his
inability to connect with voters.
Is there someone in Labour who is not a Blairite that does not behave like a 1970s left wing
geography teacher?
What paragon of perfection are you looking for. The message is the important thing not the packaging.
Blair surly taught us that. My geography teacher was a old conservative woman.
I must pass that on to my mate who started teaching geography in the late 1970s and who is an
absolute Corbyn fan. He's very disappointed that his sixth form students do not feel remotely
the same way.
The best way of working out which type of society works best and worse is to find out where people
emigrate from and where do they emigrate to. Capitalism, with low levels of corruption, wins hands
down.
I don't have an issue with capitalism per se. It can work very well as part of a balanced economy.
However when almost everything is forced to become part of the market we can clearly see
a problem.
but surely Capitalism is inherently corrupt . It's mantra is "maximise profit " and that's it
. Isn't that what the Left are being unrealisitic about .They want some sort of purified religious
experience of fiscal control . But we humans are of systems that need corruption and renewal ,just
like our bodies ? Talk about the National Health failing -- Nobody wants to do the housework that's
all ?
I'd like to thank Aditya for his article and I hope your right.
In my opinion all ideology creates shackles especially when taken to extremes. It creates distinct
hierarchies that are imposable to circumvent if you just so happen to disagree or dislike it.
As you state neoliberalism is the extreme end of the capitalist system.
- Its divisive ideological hierarchies are based in wealth, this cause's possible social
unrest as it creates haves and have not's, hard work will not help you climb the ladder, survival
of the fittest creates brings out the worst in people.
- It undermines the free market by creating business monopoly. Business monopoly undermines
the democratic model through lobbying and party funding.
- It creates the conditions that allow corruption to flourish through government de-regulation.
- The free market is driven by profit, it lacks a social conscience, yes consumers can
refuse to buy from unethical company's but this becomes difficult in markets that are run by
monopolies, and the service it provides are essential products.
There's one major flaw in all hierarchal systems, if somebody is to climb up, someone must
be pulled down. It can create animosity, greed and infighting so they are all inherently unstable.
I'm not suggesting such systems are wrong, if they are based on cooperation and fairness then
I think balance could be achieved.
A previous poster talked about automation destroying jobs and income which leads to depressed
markets as consumers do not have the income to spend. Surely the current lack of growth is the
result of manufacturing and other jobs exported abroad to save wage costs in developed countries.
This results in the same lack of spare income to fuel growth. So free market policies are destroying
the very markets they depend upon.
One solution is for government to own manufacturing in important areas such as combatting global
warming. If the uk uses the £70bn proposed for HS2 and Hinkley we could set up manufacturing of
solar panels, small wind turbines and other small renewable systems. Pay real living wage, use
areas already with high unemployment and boost the economies in these areas. Manufacture under
license and include batteries such as the Elon musk storage batteries.
Either install free or for small charge we could produce and fit renewable systems on 10 million
homes trying to produce 40 gigawatts of electricity which is equal to uk off peak use - 4kwh x
10m. Costs £5000 per system + £2000 per battery = £7k x 10m = £70bn.
Result more good jobs, boost to economy, boost to deprived areas, less CO2, no nuclear, free electricity
for many, less cost of imports of oil, gas, coal, less cost of social security. I am sure the
list of benefits can be expanded into feel good factors and less inequality.
Surely common sense will prevail before riots and revolution will end this madness.
What on earth leads you to believe that a UK Government could manufacture solar panels and wind
turbines at a profit? Does the civil service have hitherto hidden talents relating to business
start ups, manufacturing and energy technology?
We are at a world population approaching 10bn people which need to be fed, clothed and served
with clean water and electricity. And your answer - sorry to say, green dreamers - provides no
answer at all. You can talk to as many worms as you want to. It is fantasy of rich people.
There is no doubt that people are waking up to the massive inequality imposed on us all by a greedy,
compassionless, short sighted set of idiologies perpetuated by our neoliberal rulers. And the
philosophy that has driven this is corporate capitalism which has created a stench so profound
that it may literally cost us the earth.
The fact that it has progressed so rapidly and deaply into the human psyche can only be attributed
to two things. Mans inherant greed and the media (who are an intrisic part of corporate capitalism).
I heard a statistic that, in the first world war, only 17% of soldiers in the trenches pointed
their guns at the enemy, not wishing to be party to the massacre of fellow human beings. I also
understand this was little changed in the 2nd WW. To combat this (pardon the pun) recent developments
in media have created computer based games of mass murder so that soldiers in the battle field,
in aircraft and flying drones simply play out the games on their Xbox and annihalate 'the enemy'.
War is very big business, for some. This form of brainwashing is an incidious method to do the
bidding of the rich and powerful and there is, without doubt, a direct correlation between neolibralism
and mass murder. The hawks of administrations, like Bush, Blair and co , have used it citizens
to further their own agenda's for fiscal gain leaving behind millions of dead, service men missing
limbs or dead, sevearly mentally damaged and what for? The road to peace is not through bombs
and bullets but this makes money and lots of it. The media (not all, thank god for the internet)
panders to the basest emotions of humanity to brainwash us into radicalised, subserviant masses
ready to do the bidding of these cororations. It has created a Frankenstien which is now out of
control. IF we start today to try and undo the immense harm it will take many generations to even
begin to put things right, if at all possible. Every journey starts with a single step but we
must RUN if humanity has any chance of survival. Stop the war on terrorism, stop the war on drugs,
both proven and huge failures and start a war for tollerance, equality and, dare I say it, love.
Seems to me that the wealth accrued by neoliberal beneficiaries could be more fairly distributed
but it is not; why is that? On the other hand, "communisim" in the Soviet sense does not seem
to work either when Dimitri has his house windows manufactured free gratis on the factory floor.
Politicians and large corporations are self serving and insular, as are most people. The EU debate
in the UK has descended into completely predicatable mud slinging as the electorate are increasingly
ignored in the debate despite token efforts by the media. Those involved are watching after themselves,
in or out is a sidebar to hang it on.
Neoliberal ideology has been an instrument for justifying the growing wealth and power of
financiers and global corporations for about 40 years. They are highly unlikely to want to let
go their gains, so reports of the impending 'death' of neoliberalism are a bit premature. The
fact that this comes from the IMF makes me wonder if it isn't another ploy to divert attention
from the ongoing process of wealth consolidation by making us think that a big change in policy
is just around the corner. Ostry is an excellent scholar who has written some good papers warning
about inequality and I have no doubt that he wants to influence decision-making. But it may be
that he is being used as a 'useful idiot' by the powers that be.
If only. Social democracy was the popular choice in 1945 - the people knew what it was and voted
for it. But neoliberalism was imposed on us in a flurry of fake claims and false dreams - low
taxes, trickle-down riches, freedom is consumer choice etc. We could have it all, the hucksters
promised, lying in their teeth. And now that the system is showing its true nature, how do we
get rid of it. There isn't an institution, public or private, which isn't run by people who are
professed neoliberals incapable of thinking there is an alternative - if they were, they wouldn't
be where they are: they'd be mocked and undermined and shuffled out of the way, Everything from
the BBC to the Health Service is run by people who believe in the power of the market, and think
it's the same as democracy. We have to get rid of these servants of the market to make a fresh
start, and they're not about to leave.
TTIP is the desperate last stand to get this permanently embedded as a supra-governmental policy
in perpetuity. The crooks behind neoliberalism know that the wheels are about to fall off the
bus and TTIP is their answer.
Whilst it's great that the report (rightly) condemns neoliberalism it appears to me that it is
also contradictory.
On the one hand 'the IMF researchers concede, [the results of neoliberalism] have been terrible.
Neoliberalism hasn't delivered economic growth – it has only made a few people a lot better off'
but then goes on to say 'The authors even defend privatisation as leading to "more efficient provision
of services" and less government spending'.
Privatisation of state assets has proven time and time again to be a false economy. The failed
privatisation of Hinchingbrooke Hospital; The failed privatisation of East Coast Rail which was
then put back into public ownership (under which it became profitable again) and was then re-privatised
for no good reason; The Royal Mail scandal - hedge funds were permitted to buy millions of (undervalued)
shares which they then immediately sold for a massive profit whilst ordinary people were limited
to just £749 worth.
Am I missing something here? Isn't privatisation and the selling off of state assets to the
neoliberal elite exacerbating and perpetuating the problem?
I'm still wading through Thomas Piketty's Capital in the Twenty-First Century but from what
I've read so far it appears that the message is that extreme wealth inequality is not only morally
unfair but is unsustainable as it is counter-productive and creates economic instability. It's
this very instability and glaring unfairness which has led to the rise in ever more extreme politics
isn't it? The Right cling to this neoliberal model of economics and then bitch and complain when
Trump gets elected. What on earth did they expect? If elected officials continue to act in self-interest
instead of the public interest then the successes of monsters like Trump are an inevitability
which can only bad for everyone including the neoliberal elite.
" I'm still wading through Thomas Piketty's Capital in the Twenty-First Century but from what
I've read so far it appears that the message is that extreme wealth inequality is not only morally
unfair but is unsustainable as it is counter-productive and creates economic instability ."
Not sure that you need to read Piketty to understand that. The accumulation and hoarding of
wealth in offshore havens by the elite should be treated as an economic crime, as once this money
is transferred out of the system, it ceases to function, the economy is impoverished, and these
unelected super-wealthy are given powers many elected country leaders can only dream of. How the
perpetrators of this cannot understand absolutely boggles me. But then again, to wish to have
so much wealth indicates serious sociopathic issues, and not much ability to empathise with those
who struggle and are deprived as a result of this accumulation of such wealth in the hands of
a few individuals.
Whilst I simply feel indignation, exasperation and anger regarding social injustice and extreme
wealth inequality Piketty uses well researched data to support his arguments against it. It's
not an easy read and I've been dipping in and out of the book on and off over the last year. I'm
determined to finish it one day though.
I'm inclined to agree with you regarding the regarding your assessment of the super rich as
sociopathic. How much money is enough? Why would they need or want so much economic control over
so many people?
If you haven't seen it already I would certainly recommend watching Mr Robot - very topical
and spot on regarding the psychopathic mindsets of the arrogant super rich the series condemns.
The opening scene begins with a reference to the Bilderberg Group - 'they're the top 1% of the
top 1%. They're the people who play god without permission'.
It beggars belief that Mark carney is now bemoaning the results, as events that we now are witnessing
right across the globe, from his Alma Mater Goldman Sachs's policies that were foisted onto the
world, have spawned. Low and now even negative yields on safe fixed term investments are now making
it very difficult or even impossible for pension providers to deliver decent incomes to their
customers. Tax evasion has been legitimised and rebranded as tax efficiency and corporations are
mega monopolistic structures that no longer need to worry about a bottom line as they have rebranded
profits into interest payments to tax havens.
After 8-9 years argument about austerity, it finally feels like we have reached a tipping point.
Surely now no serious political or economic commentator will defend austerity. There are parallels
with the climate change debate.
The Labour Party (encouraged by many in the media- including many Guardian journalists) for
too many years pursued a policy of austerity appeasement. Many knew it was economic nonsense but
felt that the argument was too difficult to win against the massed ranks of the Tories and the
vested interests of the mainstream media. I recall so many discussions where it was pointed out
that economists such as Krugman had destroyed the austerity case but "sensible" commentators continued
to argue that the Labour Party would be destroyed if it dared to "speak truth unto power". Those
that advocated austerity appeasement should be ashamed and apologise (I won't hold my breath).
Corbyn's greatest achievement in his first 8 months has been his firm stand against austerity.
He and John McDonnell have significantly moved the debate, so much so that I fully expect that
Osborne (if he survives the Referendum fall out) will start to adopt Labour policies (e.g. allow
investment expenditure to be excluded from deficit target and, if recession spreads beyond manufacturing,
some form of Infrastructure QE).
Neoliberalism has turned out to be similar in many ways to a better connected and more efficient
form of feudalism. Great for those with power, greed and wealth and very much at the expense of
everyone else. Perhaps newspapers and mass media have replaced swords, so it is an improvement
in some ways.
But for all those anticipating a return to something better, what will eventually come next?
A return to nice, safe, gentle Western European style mild socialism is not a foregone conclusion.
It will take a lot of effort and maybe 20 years to establish a new settlement and perhaps quite
a lot of strife in the meantime. Now that the last convulsion that gave rise to a continent wide
effort to attain a just society, the Second World War, is fading from memory and educational syllabuses,
will it take another convulsion to teach us how to behave again?
Very well put. I don't think it will take another convulsion, the majority of Europe's population
are fat unfit slobs but when there's no consumer swill in the bins, maybe.
I've had many discussions about what is necessary to make people active enough to change the status
quo, although I do think that WW2 crystallized what was already public opinion, putting people
into a position where camaraderie was sufficient to have reformists like Bevan take a lead and
win. I sincerely hope it won't take another European conflict to increase class consciousness
again.
As long as people have just enough and can be made afraid of losing it, they'll do nothing.
When they have nothing worth losing, then they'll kick off.
Rulers have known this since at least Napoleon, not all have acknowledged it.
As a people the British are a long way from it, recent arrivals might in time feel differently.
long before any public protests, the insiders led the way in murmuring their disquiet. Whisper
by whisper, memo by memo, the regime is steadily undermined from within. Its final toppling
lies decades beyond the novel's close, yet can already be spotted.
When Red Plenty was published in 2010, it was clear the ideology underpinning contemporary
capitalism was failing, but not that it was dying. Yet a similar process as that described
in the novel appears to be happening now, in our crisis-hit capitalism. And it is the very
technocrats in charge of the system who are slowly, reluctantly admitting that it is bust.
The difference between a public document and a secretive memo seems a glaring one, which illuminates
the fundamental difference between the two systems and as such the reason why capitalism will
survive and communism cannot
I agree with the bits about economic consensus and neoliberalism but I can't for a moment agree
that such problems are inherent to capitalism or reveal its flaws. If anything those problems
show - as did the failings of communism - the impossibility of asserting stable state control
over markets so large and complex as to be effectively random
While Julian Assange is incarcerated I don't think you can make the claim that Capitalism has
no secrets. Hilary Cliinton's emails were leaked, and there were some pretty dastardly secrets
in there. And who knows why fracking is being pushed onto people when practically no one, expert
or public supports it. What secret deals are behind that? And of course David Cameron's tax evasion
is a "private matter". In fact capitalism rests on the assumption that property is private. Now
adays music and thought are considered private property. The bright boy who released JSTOR free
on line had the book thrown at him and commited suicide under threats of decades in a private
prison, where by all accounts rape is encouraged.
Very interesting, that's a good read.
It also strikes me that "globalisation" and the frequently assumed "global neoliberal paradigm",
is not correct. That is, the frequent assumption that free markets are the norm, and that this
is how national and global exchanges function.
What we have instead in brief is a global free market capitalism which is financed and subsidised
by the public sector. The often talked about "socialism for the rich".
It strikes me that rather than "neoliberalism having failed", the most striking movement
since the 1960ies is how private capital managed to bend democratic socialism (which means the
welfare state in its various incarnations including in the USA) and bend it to its own profit.
How it did this: "democratic socialism" (this isn't communism: all it means is "market regulation
in the public interest" and includes public services such as education, health, defense) which
flourished after the 1930ies was bit by bit taken over by the private sector. Not in terms of
ownership, but in terms of supply and management.
So neoliberalism as it's commonly understood is a foil, a fiction, camouflaging the underlying
reality of democratic socialist government which is in part at least run by private enterprise.
The practical consequences: Government support and financing of a range of industries, and
private sector involvement in running government services: the neo-liberal "The market knows best"
is an illusion.
Its complicated, and needs some thought, but I reckon there's some subtlety here, and my intention
is not to rant "socialism for the rich" - its more subtle and more interesting than that slogan.
Neo-Liberalism - the more you see of it the less you like it.
Getting to the rotten core of Neo-Liberal globalisation, a UK journey.
1) Tony Blair announces the UK is a meritocracy where anyone can get to the top through hard
work, drive and ambition.
Next elected prime minister – Eton educated and married into the aristocracy.
Eton boys occupy a myriad of positions of power.
Privately educated elite firmly re-established.
2) Everyone must be subject to market discipline and compete in a global market place.
Industries that cannot compete in the global market place must fail.
Heavy industry, manufacturing and mining decimated, severely affects the North of England and
Midlands.
The financial sector fails and is given unconditional bailouts with no effort to punish those
who made the losses, the tax payer will just pick up the bill.
3) The lasting damage to the economy caused by the financial crisis must be passed onto those
at the bottom of society through austerity to balance the budget.
Are you rich or are you poor?
Neo-Liberalism helps the rich and disadvantages the poor.
Nice rich bankers – how much do you want?
Traditional industry – left to the whims of the global market place.
All very true, except that your milestone 1) should begin with Regan and Thatcher (and Deng Xiaoping!)
not Blair, who merely continued it with a more soft-edged approach.
'Neo-liberalism' or free market capitalism will die when a better alternative system is seen to
be superior. As the article says there was a time when sensible people could believe that this
better alternative was Marxian socialism. Sixty odd years later it is impossible to believe that.
The remaining examples in the world like North Korea and Venezuela are to be avoided like the
plague and previously socialist countries like China and Vietnam have longed eased to be so.
It is important to understand the crucial advantage of capitalism over its rival, namely that
it is self-organising. Milton Friedman gave the example of the ordinary 'lead' pencil which requires
wood, paint, graphite, alloy metal for the ferrule and rubber for the eraser. Arranging for all
that to happen by centralised control is an enormous undertaking yet in the capitalist world pencils
sell for 50 cents apiece. Nobody believes in world economic direction by Central Committee and
so it is likely that global capitalism will continue unabated not withstanding a few bumps in
the road along the way.
.....global capitalism will continue unabated not withstanding a few bumps in the road along
the way.....
The same was thought/proclaimed about slavery, feudalism, colonialism. But new systems are
born as the old ones become obsolete and an impediment to progress. Capitalism will go the same
way.
It isn't either / or, black or white as you seem to suggest. A mixed economy is the ideal set-up.
That's an economy where you recognise which sectors function best as services and which run best
left to competition. That is the failure of neoliberalism, which throws almost every single enterprise
into the jaws of the competitive market. The railways should never have been privatised. Our utilities
should never have been privatised. The NHS should not be opened to 'any willing provider'. Strategic
industries should have had more protection. The housing market should not have been globalised
etc etc etc. Most of us know well who is most responsible for these failing policies.
A child could figure out that neo liberalism wouldn't work for most people. I did when I was 11.
But the super elite will always be willing to take a punt only an ideology tailor-made to make
them richer while oppressing us more. Then all they have to do is get the slimey politicians who
work for their interests to sing the anthem and get their little pay off.
Aditya is writing cracking article after cracking article these days. I thought that the one about
Boots was riveting as well as disheartening.
We've had 40 years of relentless propaganda about private = good and public = inefficient or downright
bad.
well it's surely true that private is good if you're making something like an iPhone or a Tesla,
you need entrepreneurs driven by a fanatic obsession with perfection and the profit motive.
It's surely not true if you're trying to provide public housing, electricity, gas, water, rail
or the prison system etc..
We've seen how groups of private individuals have been trusted to do right by society when their
remit was always to do right by themselves and by their shareholders. How could it have been otherwise?
It's no use having a privatised utility and then blaming it for cutting costs and raising prices.
The problem is a political one.
Leave what is best done by private individuals and companies to them, but get them totally out
of our public commons. And regulate the financial industry so that it cannot trade with the certain
knowledge that it will be bailed out by the politicians it has totally bought.
What killed neoliberalism ultimately was hubris. It worked very hard to eliminate every political
obstacle, the left, trade unions, regulation, until it was squarely able to shoot itself not just
in both feet, but in the head too.
'Neo-liberalism' or free market capitalism will die when a better alternative system is seen
to be superior. As the article says there was a time when sensible people could believe that this
better alternative was Marxian socialism. Sixty odd years later it is impossible to believe that.
The remaining examples in the world like North Korea and Venezuela are to be avoided like the
plague and previously socialist countries like China and Vietnam have longed eased to be so.
It is important to understand the crucial advantage of capitalism over its rival, namely that
it is self-organising. Milton Friedman gave the example of the ordinary 'lead' pencil which requires
wood, paint, graphite, alloy metal for the ferrule and rubber for the eraser. Arranging for all
that to happen by centralised control is an enormous undertaking yet in the capitalist world pencils
sell for 50 cents apiece. Nobody believes in world economic direction by Central Committee and
so it is likely that global capitalism will continue unabated not withstanding a few bumps in
the road along the way.
'Neo-liberalism' or free market capitalism will die when a better alternative system is seen
to be superior.
So this was the reason for the death of the Ancien Regime in France and the death of the
Romanovs? I think people were not going to wait for an alternative to come along.
.....global capitalism will continue unabated not withstanding a few bumps in the road along
the way.....
The same was thought/proclaimed about slavery, feudalism, colonialism. But new systems
are born as the old ones become obsolete and an impediment to progress. Capitalism will go the
same way.
It isn't either / or, black or white as you seem to suggest. A mixed economy is the ideal set-up.
That's an economy where you recognise which sectors function best as services and which run best
left to competition. That is the failure of neoliberalism, which throws almost every single enterprise
into the jaws of the competitive market. The railways should never have been privatised. Our utilities
should never have been privatised. The NHS should not be opened to 'any willing provider'. Strategic
industries should have had more protection. The housing market should not have been globalised
etc etc etc. Most of us know well who is most responsible for these failing policies.
A child could figure out that neo liberalism wouldn't work for most people. I did when I was 11.
But the super elite will always be willing to take a punt only an ideology tailor-made to make
them richer while oppressing us more. Then all they have to do is get the slimey politicians who
work for their interests to sing the anthem and get their little pay off.
Aditya is writing cracking article after cracking article these days. I thought that the one about
Boots was riveting as well as disheartening.
We've had 40 years of relentless propaganda about private = good and public = inefficient or downright
bad.
well it's surely true that private is good if you're making something like an iPhone or a Tesla,
you need entrepreneurs driven by a fanatic obsession with perfection and the profit motive.
It's surely not true if you're trying to provide public housing, electricity, gas, water, rail
or the prison system etc..
We've seen how groups of private individuals have been trusted to do right by society when their
remit was always to do right by themselves and by their shareholders. How could it have been otherwise?
It's no use having a privatised utility and then blaming it for cutting costs and raising prices.
The problem is a political one.
Leave what is best done by private individuals and companies to them, but get them totally out
of our public commons. And regulate the financial industry so that it cannot trade with the certain
knowledge that it will be bailed out by the politicians it has totally bought.
What killed neoliberalism ultimately was hubris. It worked very hard to eliminate every political
obstacle, the left, trade unions, regulation, until it was squarely able to shoot itself not just
in both feet, but in the head too.
Got to hand it to the neoliberalists for keeping it going for 40 odd years
"You'll love it, we get filthy rich and we chuck a few quids down to you!"
"Don't say that, say trickle-down effect"
"Ok, you'll love it, the trickle-down effect will make everyone better off!" Over 40 years
"Are you still here? I told you, it's great because of the trickle-down effect"
"Where's the trickle-down effect, it's not happening"
*silent* "Fuck right off, I don't want you snooping around my offshore trust funds, not illegal,
go on piss off"
A neoliberal will seriously argue that despite real median incomes stagnating in the US for forty
years and in the UK for almost a decade and a half that we're all better off because nearly everybody
can afford a smartphone and washing machines are cheaper.
It's not Neoliberalism that is crashing, it's Capitalism! They got too greedy and tunnel visioned
with their 'market knows all' dream in a system that favours and rewards what used to be considered
corruption and now they looting are putting in repressive and restrictive measures to control
the devastation they have caused. They are floundering about trying to work out how to stop the
major crash coming and keep their ill gotten gains and gravy train for the legions of self serving
enablers as I call them!
Prof Richard D Wolff a Marxist economist, here's this weeks talk, 1 hour. Based on US news
topics but in the second half he talks about the Neoliberal god... 'the market' or rather the
use of (or not) markets in economic systems. Krugman and Uber get mentions in the first half.
Markets from 30.00 http://www.democracyatwork.info/eu_listen_prof_krugman
Free markets without state interference invariably drift towards feudalistic monopolies. They
end up exactly where communism also ends up. A small elite controlling the economic fate of the
masses. A "market" where supply and demand no longer play any part, because any small competitor
can be bought or liquidated at will by the monopolist.
For capitalism to work the state needs to be both, strong and accountable to the people, not
the vested interests. In a global marketplace this control needs to come from a global organisation,
like the UN.
A t present the global corporations play the nation states against each other in a race to the
bottom (the end game in this game is to make the UK the Bangladesh of the North, which it was
in the 18th and 19th century). At some point we will turn the corner; the question is just whether
it is done with or without armed conflict.
This might not be the 'in depth' analysis some would like, but I think that Chakrabortty is correct
that there has been a big change in the background. The majority of politicians don't see this,
from Boris Johnson to Jean-Claud Juncker, they are clueless and out of touch, but Chakrabortty
makes an astute observation that:
...policymaking elite [claims it was doing] ... merely doing "what works". But you can only
get away with that claim if what you're doing is actually working.
Today you can read Ben Bernankes PhD thesis and see that it is wrong, you can see that the
IMF/EU Greek 'Bail Out' failed 3 times in a row, you can see that Osbourne has missed every single
economic target he set himself, you can see that 'trickle-down' economics never worked, etc.,
etc.
Meanwhile
Steve
Keens open source economic simulator works rather well, and explains why the the UK, USA,
Europe and Japan are very unlikely to ever recover if they keep on with the current economic policies.
All political systems fall under thier own weight. The infamous bread v guns can still be applied
to nation states but not obviously economic systems. The workers or any other outside group can
never change economic systems (they can only protest through populist politicians who will bend
to the system when in power), only insiders can do that. You have to hope that the change they
come up with is an improvement but it is unlikely given that almost all will want the status quo
maintained.
It was clear in the 80s the Thatcherite experiment wouldn't work and it was widely discussed and
most of the reasons put forward why it wouldn't work, have proved correct.
But we all have the evidence of privatisation. Britain has effectively been asset stripped
by the Tories, aided and abetted by New Labour but where are all the promised tax cuts? As a nation
we pay about the same in taxes as Germany, yet Germany owns the most state assets of any country
in Europe. It is what ideological neoliberal call socialist but it does better than us. Meanwhile,
for all the privatisation in the UK, our taxes are still high and on top of that, the privatised
services and utilities and businesses are more expensive, more inefficient and more unreliable
and we have to pay for much of them, on top of our already high taxes!!!
The biggest joke came when the nationalised East Coast Line came in as the most cost efficient
mainline in the country, which had the Tories desperate to privatise if as quickly as possible
to get rid of a sample of state run trains being more efficient than privatised trains. Well,
we just have to look at many European countries to see most state railways are more efficient
than privatised ones. In Holland when rail was privatised, it more or less collapsed and had to
be effectively renationalised and then partly privatised again but the trains still are useless
compared to what they were when they were completely state run.
Neoliberalism was always a corrupt ideology with corruption conscious;y at its heart. Neoliberalism
has normalised corruption to the point where the establishment and our political masters don't
even try to hide corrupt practices, they are every day work and business practices. The biggest
question is, why we aren't rioting on the streets like the French. Why are we British so damn
passive when we are being ripped off and abused? Our we really like an abused wife or child, who
has grown used to abuse and can't imagine life without it?
Economics has long been practiced at the level of a voodoo cult - light the candle and chant a
mantra.
This was apparent in 2007 when Northern Rock went bankrupt having been handing out mortgages 120%
over the value of over valued property thus accelerating a house price bubble and instantly putting
mortgagees into a position of negative equity.
It was most apparent when China kept announcing, cheered on by a chorus of economists, a 10%
growth rate whilst it tipped 70% of the world's concrete into non viable mega projects, produced
a mountain's supply of cheap steel that far exceeded any demand and pumped out clouds of gaseous
pollution and lakes of poisonous waste to the detriment of the global environment (uncosted)
Since then, well it seems that most of that extra money that was pumped into the unregulated
money markets got invested in London's luxury property market and fracking - both unsustainable,
environmentally damaging and unnecessary.
I am afraid that a mass extinction event will be the only solution.
The quantity of capital needed just to stay in the game nowadays is so gobsmackingly vast that
62 individuals now control more personal wealth than 3.5 billion of the world's poorest. This
is a level of concentration of wealth and power that the absolutist monarchies of yore could not
even have dreamed of. Corporate cartels and monopolies dominate and charge their monopoly prices
snuffing out not just their competitors but production in general as others have to charge below
value whilst the monopolists charge way above. The financial structures that kept this situation
going for the past 30 years has now collapsed owing several times the national debts of the nations
that hosted them and which liabilities they have now assumed. Even the smallest percentages of
growth require such vast amounts of capital but there is no room for further concentration or
state support for it as they are bankrupt. US-sponsored globalization and all the institutions
built upon it as a result of the death of capitalism is unraveling at an alarming rate. Globalization
behind the greatest discreet political power the world has ever seen was as far as capitalism
could take us and it has to be said that a lot of the `development' of the last half-century has
been purely destructive and will have to be reversed before we can once again go forward. Which
brings us to the second reason for the impossibility of capitalism. The political necessity of
growth, without which capitalism as a political economic system is finished, is obstructed not
just by sclerotic monopolisation and bankruptcy but by the fact that every tiny percentage of
growth requires transforming huge swathes of the nature on which we depend into useless product
and nature does not have anything left to give on this basis. Catastrophic global warming is upon
us along with a myriad of other environmental catastrophes such as the death of our oceans. It
is as it was prophesied that it must eventually be a matter now of socialism or barbarism. Socialism
or a New Dark Ages from which are species is unlikely to emerge or survive. We either transcend
capitalist globalization, neo-liberal bourgeois internationalism, through world proletarian revolution
and a world commonwealth of nations or we die with capitalism.
The authors even defend privatisation as leading to "more efficient provision of services"
and less government spending – to which the only response must be to offer them a train ride across
to Hinkley Point C.
Or try to get anywhere in the Netherlands by train when fallen leaves or an inch of snow completely
paralyses our privatised rails.
Privatisation is a total bullshit served in a very expensive sandwich to the taxpayers.
I would have like to see the author consider the role of power in this situation. With absolute
power comes also the ability to determine "reality" - distorted or not. If the emperor wields
absolute and devastating power, well who's to tell him he is naked and should abdicate?
So it, vital to note that a huge change our societies at this moment is the increasing militarisation
of civil society, erection of an unprecedented surveillance machiney, reallocation of resources
from human development to the military state under many guises, along with a close collaboration
of military and business.
In short, basically anything the author is saying is already in a scenario painted by the likes
of Rand Corp - and accounted for in the current state of affairs. There are many disguises for
all this including supposedly "threat" of migrants.
Honestly I don't think there is any stopping this train on its way to a crash.
Except the military as a whole haven't exactly benefitted from austerity. That said, as Iraq demonstrated
yet again, senior military personnel who go to Whitehall soon adopt the political drive and beliefs
of their masters.
"Austerity" in the west applies to human development programs. Not to the machinery of warfare
- or internal policing - or domestic surveillance. All of which are also essential pillars of
neoliberalism.
Issued by the Heads of State and Government participating in the meeting of the North Atlantic
Council in Wales
05 Sep. 2014 - | Press Release (2014) 120Issued on 05 Sep. 2014 | Last updated: 31 Jul.
2015 09:05 14. Allies currently meeting the NATO guideline to spend a minimum of 2% of their Gross Domestic
Product (GDP) on defence will aim to continue to do so. Likewise, Allies spending more than 20%
of their defence budgets on major equipment, including related Research & Development, will continue
to do so.
Allies whose current proportion of GDP spent on defence is below this level will:
halt any decline in defence expenditure;
aim to increase defence expenditure in real terms as GDP grows;
aim to move towards the 2% guideline within a decade with a view to meeting their NATO Capability
Targets and filling NATO's capability shortfalls.
Allies who currently spend less than 20% of their annual defence spending on major new equipment,
including related Research & Development, will aim, within a decade, to increase their annual
investments to 20% or more of total defence expenditures.
If you think the western neo cons will go with a whimper like the ussr me thinks you are mistaken.
The Chinese new yuan is gold backed and has the support of Japan Russia and France as the new
international currency. If every American paid 100% tax it wouldn t cover the federal expenditure
annually. Without the hall mark of international exchange the dollar is paper. And you think these
old east European ideologues led by Kessinger are gong to let their vision of hell go quietly
into the night?
This newspaper long ago bought into neo-liberalism. A few individual journalists allowed to write
here know what a social-conscience is, but they are "tokens"to present a fig-leaf of social values
and justice.
We see no genuine outrage anymore, no campaigning for the truth or justice, just a resigned,
brow-beaten shrug and "what can we do?"
On the whole the Graun is a paper aimed at the middle-class, professional who wants to talk
as if they care, but in the end will scurry over to the side of whoever will look after their
investments and protect them from becoming one of those whose situations they wring their hands
over...
Neoliberalism hasn't delivered economic growth – it has only made a few people a lot better
off.
Neoliberalism isn't an ideology, it is not even a doctrine - it is a legalized thievery, a
plundering of public resources aided and abetted by corrupt politicians.
It is pre-revolutionary France situation all over again, is it possible that the human race
cannot invent a working political-economic system that could effectively keep greedy, egotistical
psychopaths at bay?
The trend varies slightly country by country, but the broad direction is clear," says Adair
Turner, a former British banking regulator .... "Across all advanced economies, and the United
States and the U.K. in particular, the role of the capital markets and the banking sector in funding
new investment is decreasing." Most of the money in the system is being used for lending against
existing assets such as housing, stocks and bonds....To get a sense of the size of this shift,
consider that the financial sector now represents around 7% of the U.S. economy, up from about
4% in 1980. Despite currently taking around 25% of all corporate profits, it creates a mere 4%
of all jobs. Trouble is, research by numerous academics as well as institutions like the Bank
for International Settlements and the International Monetary Fund shows that when finance gets
that big, it starts to suck the economic air out of the room. In fact, finance starts having this
adverse effect when it's only half the size that it currently is in the U.S. Thanks to these changes,
our economy is gradually becoming "a zero-sum game between financial wealth holders and the rest
of America,"... from
http://time.com/4327419/american-capitalisms-great-crisis
/
Assuming financialisation continues
...In the United States, for example, "trickle down" economic policies that support tax cuts for
the rich with the aim of boosting economic growth and jobs have led to a $2 trillion annual redistribution
of wealth from the bottom 99 percent of earners to the top 1 percent over the last 30 years...If
the trend continues, by 2030, the top 1 percent of Americans will earn 37 to 40 percent of the
country's income, with the bottom 50 percent getting just 6 percent...
Europe won 't be much different as the richest 1% are global so we are heading to a plutocracy
where the 1% will own pretty much everything making government a waste of time. Ownership is the
real power. Politics is BS.
The economy is working well for the 1% so they will not be interesting in changing it. There may
be rising dissension throughout the West but that's not their problem to even care about. Any
alternative means them getting a smaller cut of the cake - not gonna happen.
Neoliberalism = wealth-stripping countries to pad the nests of the executive class.
Neoliberalism = granting more and more legal protection to those who already have greater power
over their fellows on account of private wealth.
Neoliberalism = Blair not in prison for war crimes.
Neoliberalism = sweetheart tax deals, privatisations, a bust and back-broken NHS, shut libraries
if not enough pensioners can be guilt-tripped into sitting there all dya giving a pretence of
business as before.
neoliberalism = horsemeat in the savoury pancakes.
Really, such a foul and ugly construct should have died YEARS ago. For the sake of basic national
wellbeing and human decency. Except this paper has been doing what it can to conflate it with
Labour (and with "moderates"!!!!), defend it and perpetuate it.
"Neoliberalism = wealth-stripping countries to pad the nests of the executive class.
Neoliberalism = granting more and more legal protection to those who already have greater power
over their fellows on account of private wealth."
Those first two are also prevalent in other regimes - North Korea or Venezuela for example.
And last time I looked neither of those were exponents of Neo-Liberal economics.
Funny how the ideology of freedom once run its course winds up in the exactly same position as
all the other despot systems, with a grossly undeserving wealthy elite making the rules to preserve
their reign over everyone else. We have less freedom now than we did before neoliberalism. We
live under a financial tyranny.
Yes, they are prevalent in far more nakedly barbaric and cruel ways to run countries.
Neoliberalism is the professional-seeming way of enabling the rape of resources and the demolition
of social structures by means other than military dictatorship or brainwashing the people into
drooling at the cult of the god-ruler.
I do hope that "North Korea do something similar too" wasn't supposed to be a subtle defence
of neoliberalism!
Good stuff from Chakrabortty again. However, it's important to stress that the IMF article operates
within the same paradigm as the agenda it critiques and so is quite limited in many respects.
By far the most surprising and important aspect of the paper is symbolic, in that it uses the
word neoliberalism. The IMF (and most 'serious' people) tend to think of neoliberalism as a term
employed by Rage Against the Machine fans whose economic knowledge extends to having thumbed through
a copy of The Shock Doctrine in a hostel on their gap year.
In terms of the detail, there's actually not much new in the paper. It sounds a lot like Latin
American ideas from the 1990s, some of which later appeared in diluted form within the World Bank
and which are still basically grounded in neoliberal logic. Essentially: markets are the gold
standard for optimal distribution of resources, but they don't always function perfectly in the
real world and so it is the task of the state to ensure they do work properly, using strong, efficient
institutions and efforts to boost competitiveness (education etc.).
It's basically the same adaptation (but not abandonment) of the old structural adjustment logic
that the World Bank made in the mid 1990s, in the face of mounting evidence that adjustment wasn't
working (because they'd stripped away the capacity of govt. to even implement the favoured reforms).
..." in the face of mounting evidence that adjustment wasn't working (because they'd stripped
away the capacity of govt. to even implement the favoured reforms)."
You may ve surprised how quickly and easily this capacity, supposedly "stripped away," can
be reasserted as soon as that's what those in power agree they should do.
Well, that depends what you mean. I was talking about the paring down and then reorientation and
partial reassembling of many developing countries' administrative structures under the direction
of the World Bank and IMF in the 80s and 90s. Those sorts of organisations wouldn't countenance
a return to anything like the state of play prior to the 1980s.
However, if you are talking about security, then this is one area where developing countries
are very much encouraged to build state capacity as far as is possible (given the 'development=security'
mantra now adopted by DFID and the like).
I question whether Aditya Chakrabortty has actually read the article in question. Chakrabortty
claims that "The results [of the neoliberal agenda], the IMF researchers concede, have been terrible"
In reality the article says:
There is much to cheer in the neoliberal agenda. The expansion of global trade has rescued
millions from abject poverty. Foreign direct investment has often been a way to transfer technology
and know-how to developing economies. Privatization of state-owned enterprises has in many
instances led to more efficient provision of services and lowered the fiscal burden on governments.
The IMF writers actually address three specific failings of recent neoliberal policy, rather
than gives a critique of newliberalism in general:
An assessment of these specific policies (rather than the broad neoliberal agenda) reaches
three disquieting conclusions:
• The benefits in terms of increased growth seem fairly difficult to establish when looking
at a broad group of countries.
• The costs in terms of increased inequality are prominent. Such costs epitomize the trade-off
between the growth and equity effects of some aspects of the neoliberal agenda.
• Increased inequality in turn hurts the level and sustainability of growth. Even if growth
is the sole or main purpose of the neoliberal agenda, advocates of that agenda still need to
pay attention to the distributional effects.
Like I say, it appears that Chakrabortty has not actually read the IMF article and is actually
discussing what he would have liked to have been in the article.
One article in one magazine does not mark a shift so no, nothing has yet changed in terms of rampant
globalisation and neoliberal economic policy. What I do see changing though is the growing realisation
that nearly forty years since Thatcher and Reagan set us on this path (with their wealthy supporters
urging them on) we're finally getting some realisation that it's a failed model - the trickle
down doesn't happen, the elites still gain more, workers and middle classes stagnate ... I don't
believe for one minute though that those at the top of the pyramid will give up easily. What next
though?
It doesnt matter what the IMF research "actually said". Neoliberalism doesnt work - if by "work"
you mean benefit the majority of people rather than a small minority - and it's delusional to
suggest otherwise.
It's an extreme form of neoclassical economics, most of whose assumptions - required to make its
bizarre assertions even remotely plausible - would cause the average person to fall about laughing.
Except of course its practitioners are careful to ensure that the average person never does confront
its absurdities head on, partly by hiding its doctrines away, partly by disguising them in false
platitudes like the "law" of supply and demand and the definition of the economic problem as matching
scarce resources and unlimited wants (resources arent scarce and wants are not unlimited).
Think yourself lucky that it's only Aditya you have to contend with. He seems unaware of the vast
amount of work being done by genuinely good economists who have carried on from Keynes and his
model of a monetary production economy (hint: most of those claiming to be Keynesians - such as
Paul Samuelson - are nothing of the kind).
I am not so optimistic that this article signals the end of neoliberalism. As AC says, it is a
description of a process, or way of thinking that is supposedly non-ideological( and therefore
'does not exist'. The term is a kind of denial, in itself.
It is about the supremacy of technology and technical systems, but only partly so, because there
is always the impression that there is a wilfulness to the decision making process which is used
as a screen to obscure the malicious undercurrents of 'pragmatic' decision making -where certain
economic elements are defined as having an inevitable quality akin to the enthalpy of energy changes-'we
cannot resist the (economic ) laws of nature' is the
siren call of these duplicitous money-grubbers-while all the time their simplistic nostrums ignore
the subtler importances of the entropy of the system, leading to ever greater disorder and ever
greater human costs.
One of the most interesting aspects of living through the "Thatcher' era , when she and her acolytes
were promoting this simplistic 'revolution in thinking-the supremacy of the market idea ' - leaving
behind the failures of statism the forlorn social contract and the established principle of seeking
out complex, negotiated accommodations of conflicting interests, was the clear impression that
behind all that quasi- philosophical/right wing ideological stuff was a simple deep desire to
rip off the dupes (the wider public) who had no idea what was really happening under their noses.
It was nothing more than a considered cynical position to take advantage of the money making opportunities
offered by public systems that had been heavily invested in over decades, and were therefore available
for carpetbagging capitalism.
Essentially it was the use of insider knowledge and trading. The elevation to a philosophical
perspective was simply a cover for the criminal activity and insider plundering.
Essentially we saw the identical pattern emerge after the collapse of the Soviet Union where
serendipity, desperation and ruthless gangsterism coincided to create the squalor of what we now
see being enacted in the west-end property casino of London.
What should be remembered is the Yeltsin era, when, to all intents and purposes. western 'scrap
metal' dealers or their agents were snuffling around the wreckage, looking for the quick profits
of (the equivalent of) ruthlessly ripping out the copper pipes and plumbing of that empire.
What did we get? We got a regression into the Putin (orderly and systematic theft) statist despotism,
and the lurch into a competing despotism, which we see in places like the Ukraine, being fascist
puppet operated for the convenience of malignant interests in the west.
No political party or country can stand up to neoliberalism and decide to go their own way. Sooner
or later the guys with the baseball bats, probably German, will pay them a visit.
It's pessimistic but like global warming, things will only change after a catastrophe hits
really close to home. We may have more information than we had in the past but the deadening comforts
of western middle class living has left us dull and unable to respond.
Galbraith had seen this. He said that neoliberalism was like feeding the finest oats to the
stallion in the hope it would generate some undigested droppings on which the sparrow could feed.
It seems that the sparrows now want more of the oats and not from the droppings. Corbyn and
Bernie Sanders-phenomena that Blair purports not to understand- are symbols of dissatisfaction
of the increasing and disenchanted young people denied opportunities. They do have plans to put
in place of neoliberalism. Let us hope that this uncaring world changes.
The Stock Exchange, once an instrument to raise capital for investment is now nothing more than
a casino.
German family owned businesses are the backbone of the German economy, in the UK companies listed
on the Stock Exchange are the fiches on the casino table.
Just look where it all 'ends', huge pharma (Pfizer) companies buying up the competition, not for
research, not for the good of the employees but as a way to embark on tax dodging.
Chakraborty one of the best in this news medium
Reminds me of the old joke. My father died peacefully in his sleep....unlike the passengers on
his bus who went screaming to their deaths. Better if neoliberalism's demise were to be assisted
by a viable alternative economic theory. If not, it'll take us all with it, over the cliff into
oblivion. So, anyone got a plan?
We will rely more and more on machines and AI to make a plan. They can play chess and maybe they
can come up with a plan. The machines of the first industrial revolution were daft, nowadays these
machines start to become smart. This is a huge difference.
My 2012 paper "Saving the Euro" describes an economic model of Europe that replicates the GFC
monetary crisis and then tests the effect of a range of policy options on the model. Some policy
options have positive effects. The paper is available at: buoyanteconomies.com/SavingTheEuro.pdf
The remarkably naive idea that any market could be free, and that some god called 'market forces'
would always take care of things, is awfully primitive, but also very human. Time to get heads
out of sand, however, and face facts. We are never going to have the ideal anarchist state; we
are never going to see real communism (as opposed to state capitalism) work; and neo-liberalism
was dead in the water from the start.
There are ways to make economies work, but they involve much more thinking and work, and much
less knee-jerk spouting of opinion.
I just hope we survive the mess left by the last 35 years' mismanagement of everything.
There are ways to make economies work, but they involve much more thinking and work, and
much less knee-jerk spouting of opinion.
If you read the report that's pretty much what it concludes.
This is the second piece in as many days that completely travesties a reports (Z WIlliams article
on pregnancy advice is the other).
I would suggest as a rule of them that whenever you see the word "report" in a Guardian
opinion column you go looking for it on the internet, because what you are about to read will
have very little to do with the research, rather a projection of the author's own views onto it.
What's sad about his is not just the level of misinformation being spread about but how resistant
the views even of intelligent and articulate people are to evidence and research. They read the
reports, and just say what they were going to say anyway.
Quite right. A lack of what used to be called 'reason' or 'rationality' has been dominant for
decades now, and it seems to be getting worse.
It should have been clear from the start that Thatcher, Reagan, et al. were wrong. A more equitable
distribution of wealth, and hence a more healthy economy, will involve all sorts of things at
which both left-wing and right-wing conservatives (by that I mean those on both sides of the political
spectrum who cling to old ideas) will scream bloody blue murder. One could start with the complex
of environmental concerns, for example.
Another insightful article from Chakrabortty, who, along with John Harris continues to provide
welcome sense, in contrast to a host of Westminster bubble hacks that get regularly aired in the
Guardian (my personal frustration list includes Behr, Freedland and Rawnsley).
I don't, however, yet think we can be sanguine about a lessening grip from this destructive
ideology. It has a grip in higher education economics departments, where it seems to take the
Jesuits approach to grabbing them whilst young and impressionable. It also has a grip on what
passes for media in many western countries, where it continues with its poisonous propaganda in
which symptoms morph into causes.
Read any of the articles in this paper in which the EU referendum is mentioned, and see the
blaming of immigration for everything from zero hour contracts and pressure on housing and services
to the weather (OK, I made the last one up, but you get the drift). A classic is the article on
Stephen Hawkings views on Trump and the referendum where btl is infested with all sorts of crap
about how he 'doesnt get it because he's not working class'.
Neo-liberalism is and has been the establishments ideology for a few decades now, and whilst
it's cheer leaders and supporters continue to exert their influence over the media and HE it could
stagger on a while longer yet.
You don't need globalisation to make shoes with robots.
If cheap labour is out of the equation then robots will most likely return production to local
markets, as shipping will be an unnecessary cost.
And Adidas have been using evil sewing machines for decades, also naughty electricity: how
far do you want to roll back this particular "race to the bottom"?
Automation is terrible in neo-liberalism. But Guy Standing, Paul Mason, David Graeber, Yanis Varoufakis
and Robert Reich make clear that you can have automation and still have social cohesion and security.
Universal Basic Income is step one on the road to Postcapitalism.
Yes; lots of valid points - although you left out that the report didn't say neoliberalism was
all bad - nothing lasts thirty years in a democracy if it's entirely sh*t. We all voted for more
cheap tellies, cheap clothes, cheap holidays, cheap nannies etc etc.
The question is not even 'How do we adapt to the death of neoliberalism?" It's 'How much can
we even afford to let neoliberalism die?' No politician who wants to stay in the job for ten minutes,
is going to tell the electorate what the future of globalized free trade (which means globalized
free movement of labour units) really looks like - so they keep filtering the whole thing through
the old meaningless panto of "left and right."
Farage and Trump are punting exactly the same "hard-left" protectionism that the likes of Arthur
Scargill once fought for, yet the media (and politicians) still shriek about them being "right
wing," while Sanders and Corbyn have an internationalist view that George Soros would happily
endorse.
We've already had the mainstream begin to adapt - eg; Hillary Clinton faking concern about
neoliberalism's excesses in order to see off the threat from Saunders, while the Conservatives
had to concede an EUref to UKIP. And while it's (on balance) a welcome death - we'd better hope
that it's a reasonably gentle one that acknowledges what works, not the kind of infantilized 'pull-up-the-drawbridge'
populist crap that Trump spoon-feeds his demographic. The faster the mainstream adapts, the better.
Neoliberalism necessarily impoverishes. Its object is to produce goods and services more cheaply,
ie reduce wages. Unfortunately, workers are also consumers, so reducing wages means reducing consumption,
which in turn means reducing production.
A pleasanter system may be to separate production (by machines) from consumption (by humans),
hence the interest in helicopter money and citizens income- methods by which individuals are paid
by their society to consume.
The simpler, and so perhaps more likely scenario, is war and pestilence, to create shortages.
Universal Basic Income yes, helicopter money no. Helicopter money is the last bullet of neo-liberalism.
Printing and dumping cash in the hopes that people will spend or invest it. It's the ultimate
act of can kicking.
Last year the rich countries' thinktank, the OECD, made a remarkable concession. It acknowledged
that the share of UK economic growth enjoyed by workers is now at its lowest since the second
world war. Even more remarkably, it said the same or worse applied to workers across the capitalist
west.
I wonder if these bastions of economic probity, the IMF and the OECD, will ever apologise for
supporting neoliberalism. I wonder if they will ever take any responsibility for advocating a
system which has resulted in the rich geting so much richer whilst most of the rest see little
or no improvement in their lives, and now increasing numbers of the poor become destitute. I wonder,
but I doubt
Yes, it's dying, but not dead yet. It's as much a social doctrine as it is an economic ideology.
DBS checks and criminal registers are still very much alive, and these are beacons of neoliberal
philosophy. But creating environments where the masses destroy each other-and the rich few prosper-
is not a new thing. For years Christianity advocated a similarly dogmatic stance. The biblical
"meek shall inherit the earth" has been catastrophically and deliberately misrepresented by those
with a vested interest in doing so. You think there is absolute truth and morality? Think again,
the market defines what is and is not moral, always has done, always will do. The only thing that
neoliberalism changed was the moral goalposts. Instead of blasphemy it uses sexual deviancy as
it's antithesis. Oh the myopic masses.
All the problems we face today have their roots in the neoliberal ideology. It created a monster
that now stamps across the world crushing any country with independents from the grip of this
corporate elite. They use financial weapons to destroy economies that don't give into their way
of doing things. It breaks up communities to make workers vulnerable, drives wages down, reduces
the tax on their profits, sells off all state assets the taxpayer built to made to modern world
possible... at rock bottom prices. The list of destructive aspects that can be attributed to neoliberalism
is long. Here are a couple of biggies we won't be able to recover from for generations to come.
Intergenerational theft by it's approach to the housing market used to prop up the decreasing
wages and create and illusion we were all getting richer. All it was doing was stealing from their
children to enrich themselves in the present. Then the problems now with care in the community,
a result of the break-up of communities to exploit labour. This could turn into an extremely long
post if I was to just name all the major problem but Pensions and the privatising the utilities
have left the lives of the children of today blighted. Oh and then there is the climate, another
problem exacerbated by neoliberalism. Its control of media outlets means the public will never
be properly informed about this issue or any issue that might challenge the neoliberal agenda.
I think we can now say after this debacle that the most productive cohesive and successful period
the west has had was under socialist democratic control after the WW2.
The Achilles heel of neo-liberalism was that it over emphasized the supply side. Costs had
to be driven down by emasculating Trade Unions, curbs on workers bargaining power were introduced
and salaries plummeted, government services had to be cut with direct consequences on jobs and
quality of life and, taxes to the rich were simultaneously cut exacerbating income inequality.
Some of us have been saying this for sometime, that if you create unemployment in the name
of efficiency and drastically reduce the salaries of those already in employment who is going
to buy the goods and services which were now being produced "efficiently" under neo-liberalism.
You can not get growth under this scenario, ultimately you have to reckon with question of decline
in aggregate demand and the concomitant income in equality caused by neo-liberalism. What the
proponents of neo-liberalism thought was the holy grail of economics turned out to a be a veritable
cul-de- sac. The rising tide that was supposed to lift all boats has turned out to the whirl pool
that threatens to suck all of us to the bottom of the sea.
The only death here is in the acknowledgement of neoliberalism's essential failure to deliver
a fair and equitable society.
Soviet state socialism lied, because it pretended to be a necessary step on the way to
common ownership of the means of production: but instead fell into the hands of uncompromising
thugs. It failed because the neoliberal capitalist system is a far more efficient way for uncompromising
thugs to run things.
Unfortunately, unlike soviet state socialism, there is no practical alternative to neoliberalism,
since all the institutions that opposed it or ameliorated it have been destroyed or suborned.
Consequently, neoliberalism no longer needs to pretend that it is an ideology committed to fairness
or equality.
This is not the death of neoliberalism. It is neoliberalism beginning to shed a false skin,
coming out of the closet.
It is neoliberalism coming to life, and walking the streets unashamed of its true nature.
The only death is the death of its pretence to be a system that benefits all: and this results
from an arrogance that considers all alternatives, such as socialism or Islam, to have been consigned
to the dustbin of history.
These lying ideological bastards have destroyed millions of lives and dented the hopes and aspirations
of millions more. Their warped gurus, Hayek and Mitford et al are economic illiterates who have
been peddling their failed filth for years, buttressed by soulless politicos such Reagan, Thatcher
and Blair. They and their failed experiment based on greed rather than need should be confined
to the dustbin of history.
Interested to read the comment about the fact that UK workers no longer enjoy a share of economic
growth. I'm 50 and have one 48-year-old sibling. As we grew up as children in the 70's and 80's,
our father's salary as a department manager in a major high street supermarket chain was more
than enough for us to have a very comfortable childhood. For children today to have the same experience
would require both parents to work - and much longer hours.
The fable 'you never had it so good' is a blatant lie.
We can't turn back the clock and even if we could I have no desire to return to the strikes
and conflict of the 1970s. Yet at the same time it is abundantly clear that as a people we are
being squeezed until the pips squeak... Today it is zero hours contracts and "If you don't like
it, quit, and I'll hire a migrant on half your salary"... This isn't freakonomics, it's fearonomics
- and it's far too effective to go away any time soon.
the real irony being that capitalism is driven and sustained by demand, while neo-liberalism privileges
supply, which increases inequality.
This becomes a problem as capitalism is also dependent upon the poorest half spending for its
health. Neo-liberalism is, in essence, economic Anorexia Nervosa.
No where in their bag of tricks did they try the one that would actually work, increase the
spending power of the lower half, but that is anathema to neo-liberal philosophy.
The real advantage for neo-liberalism is that they've already made off with most things of
value that weren't legislatively nailed to the floor.
The state has been militarised to such an extent armed revolution is all but impossible. What
really terrifies them is that we will simply ignore them and create our own alternatives. Take
Argentina in 2001 as an example. It was the only country in history to default on it's debt due
to popular revolt. The revolt in question centered on people forming alternative social and economic
services in their own communities around the rallying cry of "Que se vayan todos" or they can
all go to hell. There are a few books published under that title about it that are free online.
Similarly, have a look at this vid from David Graeber. You can start at 2:56 for a direct answer
but it's worth watching the whole thing: https://youtu.be/mU1pQIMv8_A
It acknowledged that the share of UK economic growth enjoyed by workers is now at its lowest
since the second world war.
When the economy crashed in 2008 they labelled it credit crunch. The explanation was, and still
is, that lenders ran out of credit to carry on lending. But all along they knew that they needed
credit primarily to cover their ever mounting losses and carry on business as usual. If their
loanees were keeping up payments, not a single lender would crash because of lack of credit.
Quite basically neoliberal capitalism bit off the same finger that fed it. By going for eternal
suppression of wages, forever reducing taxes, and forever shrinking states, they set up a system
that helped them to keep more and more proceeds of growth for themselves. Sounds great until you
realise that demand has disappeared from the economy. That is what happened in 2008. There was
never a credit crunch. If there is real demand, credit would be found somewhere. Central banks
can make credit available to meet real demands.
If the economy is to start growing again, there has to be a fairer distribution of the proceeds
of growth. It means higher and fairer wages, higher taxes, a more robust state (the state has
always been a major redistributor of wealth). This would bring back demand into the economy. These
changes go against every principle of neoliberalism. But then that's why it died,
Neoliberalism isn't an ideology, it's about class interests. Neoliberal principle is turned on
its head whenever that's in the interests of the economic elite - witness the nationalisations
and state aids during the banking crisis.
Neoliberalism isn't an ideology, it's about class interests.
Why can't it be an ideology that is organically linked to class interests? The fact that an
ideology involves an internal, situational gap between official rhetoric and policy substance,
is not enough to disqualify it as an ideology. It just means that the ideology is more complex
than its surface suggests.
We live in the Breshnev era of neoliberalism. The ideology is utterly discredited, and all around
is stagnation and despair, but the more it fails in fact, the more it is enshrined in law. TTIP
is one example, the Berlin-Brussels determination to "constitutionalise" neoliberalism in the
EU by outlawing alternatives is another. If anyone does not know what I'm talking about, I refer
them to the Fiscal Compact, and to the ongoing assault on Greek democracy.
The tragedy is that the Soviet example demonstrates that such zombie systems can continue for
decades. The post-mortem phase of the Stalinist system was of much greater duration than its brief
pre-mortem era (if it ever was alive for more than 5 minutes). Metaphorically speaking, the embalmed
corpses of Thatcher and Merkel may be inspecting parades in Red Square for years to come, as one
wasted generation gives way to another.
I hope you are wrong, and there is hope that you are. One of the big ones is me being able to
talk to you from here in Angola where I am currently working. The internet.
Nothing like that existed in Russia, or anywhere else in the world. They could only go by word
of mouth as nothing was written to give an alternative. People were isolated, they lacked credible
information, yet today we are awash with more information than any of us can handle. The job today
is to sort the wheat from the chaff.
2008 woke up the people when they found out what the banks have been up to, but that was also
as the internet was growing exponentially. Even granny is on Facebook today. The best bit is governments
cannot control it in the same way they could control the media before.
...what you're witnessing amid all the graphs and technical language is the start of the
long death of an ideology.
The start ?
Y'know I could swear I remember both the IMF and the World Bank officially donning hair shirts
and admitting what research had clearly shown: that the imposition of neoliberal policies as preconditions
for financial aid packages had generally proved totally disastrous for those they were supposed
to help.
That was back in the 1990s... In practice very little has changed--except that nowadays an
article such as the one we're commenting on may include journalists--in this case TV correspondents
--in the list of those who continue to reassure us, regardless of any evidence to the contrary,
that neoliberal policies really are working.
Thus the delectably cynical modern definition of a journalist: one who is paid by the rich
to tell the middle classes to blame the working classes.
It all feels a bit late. Growth figures have become meaningless. It doesn't matter what the state
of the economy is, because all most of us see is zero hours contracts and zero public services.
The result has been Trump, the rise of the far right, and the probable break-up of the EU (and
possibly UK as well). Our political elites are still asleep on the job. I genuinely don't know
where this is taking us.
From the IMF paper:
"Austerity policies not only generate substantial welfare costs
due to supply-side channels, they also hurt demand-and thus
worsen employment and unemployment. The notion that fiscal
consolidations can be expansionary (that is, raise output and
employment), in part by raising private sector confidence and
investment, has been championed by, among others, Harvard
economist Alberto Alesina in the academic world and by former
European Central Bank President Jean-Claude Trichet in
the policy arena. However, in practice, episodes of fiscal consolidation
have been followed, on average, by drops rather than by
expansions in output. On average, a consolidation of 1 percent
of GDP increases the long-term unemployment rate by 0.6 percentage
point and raises by 1.5 percent within five years the Gini
measure of income inequality (Ball and others, 2013)."
And here in Australia, the Liberal government is trying to sell us a $50 billion reduction
in company tax, and an even larger, unspecified reduction in government spending to return to
budget surplus as a "plan" for "jobs and growth".
This sucker went down in 2008. What has happened since has been a nightmare. The money-printing,
giving that money to the rich, economic 'growth' based on immigration has rewarded those that
brought 08 about, whilst punishing it's victims again. Hopefully either Trump, Corbyn, Brexit
or Russia re-exerting it's power can finally drive a stake through the neolib heart.
" Global Financial Crisis Coming – Japan Warns of "Lehman-Scale" Crisis At G7
Japanese Prime Minister Shinzo Abe warned his Group of Seven counterparts on Friday that
the world may on the brink of a global financial crisis on the scale of Lehman Brothers."
This quote from an article on zerohedge.com this morning.
Yet most of humanity remains in the dark, continuing their lives without thought of what is
about to happen - a financial crash of such enormity, life will never be the same again. Hardly
anyone is preparing and even if they do, it will be to no avail because apart from the elite who
will disappear into fortified underground bunkers, we shall be left to fight for our lives by
whatever means possible.
Too bleak a picture? Food riots going on in Venezuela should be enough to demonstrate what
can happen. And the US is partially to blame, labelling Venezuela a threat to their security.
That Venezuela will pushed into using the dollar for trade is one way of protecting the petrodollar
and the reason behind such a stance. Is there no end to the hegemony of a would be slavemaster?
Indeed, as per the ending of the book Red Plenty "What kind of socialism is that? What
kind of shit is that, when you have to keep people in chains? What kind of social order? What
kind of paradise?"
Yes; it's dying from within. It was theory, and scholars are abandoning it. But those who put
the theory into practice are still there, and they're clinging to their ideology as much as to
their seats.
Neoliberalism is bankrupt in every sense of the word but that doesn't stop the EU, in particular,
from imposing its destructive "remedies" - read poison - on member states. And the problem is
that we can't remove either the Commission or the bureaucrats, no matter how much they fail. The
EU is not a democracy but a kleptocracy. Once you're in, you're in for good. The high-placed bureaucrat
who fears for his/her job doesn't exist. Elections are a sham. Nobody - absolutely nobody - votes
for a European party or a European platform. The minority that goes to the voting booths uses
their ballot as a way to express approval or disapproval of national governments.
And so we are stuck with neoliberalism, just as the Soviet Union was stuck with communism under
Breznev and Andropov. It wasn't working, but the bureaucrats and leaders had a vested interest
in keeping it going.
"Two British examples, suggests Will Davies – author of the Limits of Neoliberalism – would
be the NHS and universities 'where classrooms are being transformed into supermarkets'. "
The dominant neoliberal, market fundamentalist order must, like any competent cult, enforce
its authority by doubling down each time its worldview is threatened. This is accomplished by
identifying and monetizing regions of social life that had hitherto been neglected or underutilized.
In the latest sting, the student is reduced to the status of a consumer whose actions and decisions
are governed purely by the market algorithm. The reduction must be so complete that the student-consumer
identity should appear obvious and unquestionable.
"Since the crash, central bankers, politicians and TV correspondents have tried to reassure
the public that this wheeze or those billions would do the trick and put the economy right
again."
The financial crash of 2008 was the biggest and latest bursting in a series of asset bubbles,
following on the footsteps of the 2000 bust of the Dotcom bubble. Taking the long view over the
last thirty years, the blowing and bursting of one asset bubble after another has served as a
means of vacuuming up the social wealth, as the top economic tiers have been successively bailed
out at the expense of the majority of the population.
To express it in the precise language of physics, the bubble-burst-bail cycle is the pump'em-fleece'em-blame'em
game that the economic elite perpetrate on the unsuspecting commoners.
The captured organs of government managed to again bail out the big speculators and players,
privatizing their gains during the expansion of the bubble and socializing their losses during
its bust. In other words, a smooth operation of radiating risk from high-stakes gamblers and scammers
to the society at large. However, the ripple effects of the latest crash have not been completely
damped out and, if anything, the magnitude of the shock waves keeps increasing after each manifestation
of discontent and protest against the neoliberal machine.
A cascading series of cracks are beginning to appear in the illusion of the steady-state equilibrium
of the world, fracturing the end-of-history narrative that the neoliberal order has been energetically
maintaining for the past three decades. Nevertheless, the this-can't-go-on-but-it-will-go-on state
of affairs seems to be sputtering and not going on as smoothly as before. Occupy Wall Street,
Corbyn, Sanders, Syriza, Podemos, etc., are the fissures through which the pent-up and inchoate
frustrations of various social forces are periodically finding an outlet to the surface.
The dangers of the ever-increasing extreme inequality and the instability it can cause are
explored by various scholars including
Acemoglu and
Turchin . The latter
applies a dynamical system approach to estimate political stress pressures that could lead to
crises. According to his analysis we are on the cusp of one such instability. The increasing instability
of the neoliberal order implies the shifting of the ground beneath it. The previous givenness
of the passive citizenry is becoming less so, and critical junctures might approach fast and unforeseeably.
It's reaching end game in the US. The global elite now control most of the world's wealth. Congress
is corrupt as hell. TTIP will grab any jewels the people own, like the NHS.
But communism fell internally when the people didn't want it. one way to stop the global elite
is to tax them properly, including their corporations, like Facebook and Google. The French are
at least taking Google to court for extra tax. And these damned tax-shelters need to be closed
down and firms outlawed from sending their money their.
Even Luxenbourg is a parasite. It offers these company's a nice low tax rate ( in the EU!) and
their citizens have the highest standard of livening in the EU for doing zero.
Please, do not keep equating the Russian dictatorships to Communisim.
It isn't, never was and never could be.
The USofA demonised the concept of true socialism by using the excesses of the USSR as a blind
in order for its wealthy ruling elite to further mislead the general population.
As Rolly said, USSR was neither socialist nor communist. It was a torture chamber with a red flag
and social welfare. There are multiple paths to a communist society, to the tragedy of the people
who lived under it that was not one of them. The Spanish anarchists have it a fair go and did
particularly well given the circumstances. I don't know if I would follow any of these ideologies
as a way out but alternatives do at least exist.
Yes, it's certainly too soon to add bunting and balloons to the shopping-list and, as the Straw
Man says in The Wizard of Oz, it will probably get worse before it gets better, with those who
truly, madly and deeply believe in the ideology or cult of neoliberalism exercising and inflicting
it more savagely and ruthlessly in the years to come.
Neoliberalism is a heist of wealth from those who create it at the bottom to those who plunder
and squander it at the top.
It is forever aided and abetted by useful idiots, who think that earning a few multiples of
the average wage or having a few thousand in the bank puts them on a level which is closer to
Carlos Slim or Warren Buffet than the sanctioned, hardworking, wage-free supermarket shelf-stacker
and charity food-bank shopper.
The cheerleaders and shills who swarm like flies around shit.
Excellent article. I particularly enjoyed 'fiscal waterboarding'.
This is one of Spufford's crucial insights: that long before any public protests, the insiders
led the way in murmuring their disquiet.
... what you're witnessing amid all the graphs and technical language is the start of the
long death of an ideology.
Well, we live in hope. I'm sure I'm not alone in wishing neoliberalism dead and buried. Unfortunately,
it's clear that the key word in each of those quotes is 'long'. The relatively few who are benefiting
from the neoliberal model won't give it up without the mother of all power struggles.
"The relatively few who are benefiting from the neoliberal model won't give it up without the
mother of all power struggles."
Yeah - thats the nub. They are not going to give up their huge power and privilege merely because
the system it relies on is screwing everybody else. Intellectual critques will get nowhere without
change being forced by unrelenting pressure from mass movements of ordinary people - strike, occupy,
demonstrate, boycott and organise.
What is remarkable is how long it has taken for institutions like the IMF to state what has been
obvious to most populations for many years. The contrast with the rise of rewards at the top and
food banks at the bottom should have been a red rag to a bull for any organisation which supposedly
has the whole of the worlds population to consider. The lies about 'public bad and private good'
have led to whole sectors of teachers, doctors and other public servants to be alienated.
I find the difficulty of voting to stay in an obviously neoliberal Europe or a probably more neoliberal
UK a difficult choice. My gut feeling at the moment is to vote out and hope the more extreme neoliberal
policies of Redwood and Johnson will quickly alarm the British public and we may get back to electing
a socially minded government and not have to endure this lying 'caring conservatism' which voting
remain will entrench for many years.
It seems that the political arm of the IMF which supports Bremain is at odds with the research
arm which is more ambivalent about the excesses of neoliberalism.
The "Free market" is a non-sequitur: A free market ends up in monopoly.
Inevtitably.
That's why all free market economies have at their root a mechanism for preventing monopolies
working.
Economist is fundamentally illogical based on the basic fact that economics deals in "Value",
and that value is something essentially illogical. It is not possible to objectively give a value
to a kilo of potatoes, much as economists have tried, not elast Marx who was a clever person.
This need to prevent monopolies originates in that, in various tortuous and complicated labyrinthine
ways.
The reality is that a "free market" only exists where there are numerous buyers and numerous sellers.
Once supply is consolidated in the hands of the few (i.e. almost every commodity in our modern
world) then the market is distorted and no longer free.
Whereas states previously had powers to prevent monopoly power in their own country there is
no such mechanism to regulate at a global level.
But the fundamental reality of a market is the basis of human society.
What is that supposed to mean exactly?
"...Lessons of October (156k) written only shortly after Lenin's death in 1924, issued a serious
warning to workers about the mistakes and inadequacies of the clique already forming around Stalin.
It obliquely draws lessons from the failure of the German revolution, "a perfectly exceptional
revolutionary situation of world historic importance," due in part to the failure of leadership
of Stalin himself, which left the Russian revolution isolated.
But it is Trotsky's In Defence of October which is most recommended to the new reader. Trotsky
concludes this remarkable explanation of the ideas of Marxism (as developed by Lenin and Trotsky)
with the words:
"The historic task of our epoch consists in replacing the uncontrolled play of the market
by reasonable planning, in disciplining the forces of production, compelling them to work together
in harmony and obediently serve the needs of mankind."
(In Defence of October)
In a popular piece that recently appeared in Foreign Affairs magazine, headlined, "The Future of
History", Francis Fukuyama pointed out that, despite widespread anger at Wall Street bailouts, there
has been no great upsurge of support for left-wing political parties. Fukuyama attributed this –
rightly, I believe – to a failure of ideas.
The 2008 financial crash revealed major flaws in the
neoliberal view of capitalism, and an objective view of the last 35 years shows that the neoliberal
model has not performed well relative to the previous 30 years. This is in terms of economic growth,
financial stability and social justice. But a credible progressive alternative has yet to take shape.
What should be the main outlines of such an alternative?
A progressive political economy must be based on a firm belief in capitalism – that is, on an
economic system in which most of the assets are privately owned and markets largely guide production
and distribute income. But it must also incorporate three defining progressive beliefs: the crucial
role of institutions; the need for state involvement in their design in order to resolve conflicting
interests and provide public goods; and social justice, defined as fairness, as an important measure
of a country's economic performance.
It was a great mistake of neoclassical economists not to see that capitalism is a socioeconomic
system and that institutions are an essential part of it. The recent financial crisis was made far
worse by profound institutional failures, such as the high level of leverage that banks were permitted
to have.
Empirical research has shown that four sets of institutions have a major impact on the performance
of firms and, therefore, on a country's economic growth. These include the institutions underpinning
its financial and labour markets, its corporate governance arrangements, its education and training
system and its national system of innovation (the network of public and private institutions that
initiate and diffuse new technologies).
Another defining belief of progressive thinking is that institutions do not evolve spontaneously,
as neoliberals believe. The state must be involved in their design and reform.
In the case of institutions underpinning labour and financial markets, as well as corporate governance,
the state must mediate conflicting interests. Likewise, a country's education and training system,
and its national system of innovation, are largely public goods, which have to be provided by the
state.
It should be clear that the role for the state that I have been describing is an enabling or market-supporting
one. It is not the command and control role promoted by traditional socialists or the minimalist
role beloved by neoliberals.
The other defining belief of progressive thinking rejects the neoliberal view that a country's
economic performance should be assessed solely in terms of gross domestic product (GDP) growth and
freedom. If one is concerned with a society's wellbeing, it is not possible to argue that a rich
country in which the top one percent holds most of the wealth is performing better than a slightly
less wealthy country in which prosperity is more widely shared.
Moreover, fairness is a better measure of social justice than equality. This is because it is
difficult to devise practical and effective policies to achieve equality in a market economy.
In addition, there is a real tradeoff between equality and economic growth, and egalitarianism
is not a popular policy even for many low-income people. In my experience, trade unions are much
more interested in wage differentials than in a simple policy of equal pay for all.
These are the core principles that I believe a new progressive political economy should embrace.
I also believe that Western countries that do not adopt this framework and instead cling to a neoliberal
political economy, will find it increasingly difficult to innovate and grow.
In the new global economy, which is awash with cheap labour, Western economies will not be able
to compete in a "race to the bottom", with firms seeking ever-cheaper labour, land and capital, with
governments seeking to attract them by deregulating and shrinking social benefits.
The only way Western economies will be able to compete and improve their standard of living is
by seeing themselves as being involved in a race to the top. That is, firms must improve their value
added through innovation in existing industries and by developing the capability to compete in new
and more sophisticated industries, where value added is generally higher.
Companies will be able to do this only if governments abandon the belief that they have no role
to play in the economy. In fact, the state has a key role to play in providing the conditions that
enable dynamic companies to innovate and grow.
"... ...In many ways, it is remarkable that candidates who speak against free trade the way Sanders and Trump have have had significant traction this primary election season. But the signs have been there over the past few years. Wendy Brown, a political scientist at the University of California, notes that the Occupy movement was among the first to point out the dangers of the neoliberal economic system. ..."
"... I expect there will be a struggle between the free market fundamentalists and a broader, vastly more numerous base spanning both blue and white collar working and middle classes. Inequality will be one driver but there will be others. We have to shake 18th century economics, 19th century industrialism and 20th century geopolitics - the forces that spawned globalism. These modes of organization are antiquated and no longer retain much utility. They were conceived during and designed for a much different world with a far smaller overall population, a surfeit of cheap resources and a far lower rate of consumption. ..."
Fortune magazine ponders whether neoliberalism in its home country - the United States - can
survive the November elections.
Neoliberalism ...is an economic principle. It refers to the belief that markets should be frictionless
and unfettered by things like regulation or organized labor. Neoliberalism has its roots in the Chicago
School of economics pioneered by Milton Friedman in the 1970s. The concept found its footing in the
1970s and 80s, with champions like Chile's Augusto Pinochet, Ronald Reagan, and Margaret Thatcher.
It then evolved into a basic economic outlook for major political parties in much of the Western
world. Neoliberalism's stature reached new heights in the 1990s, when President Bill Clinton signed
the North American Free Trade Agreement and British Prime Minister Tony Blair created the "New Labour"
movement, moving the Labour Party away from its trade union roots.
This is the world that British journalist Paul Mason addresses in his book Postcapitalism:
A Guide to Our Future, Mason ...argues that the current iteration of capitalism, neoliberalism -
prevalent mostly in western democracies - is sick and dying.
But the go-go 1990s feels like a distant memory today. And in his book, Mason suggests a way
forward, drawing on classical Marxist theory that's been updated for the information age.
Mason argues for what he calls a postcapitalist society. Such a system would include universal
basic income; a socialized finance system; increased collaborative work; and increased regulation
to prevent the growth of low-wage, low-growth jobs. Imagine if we could all enjoy the benefits that
sharing economy companies like Uber offer its participants but companies also paid enough taxes to
pay for programs that support those workers.
...So, how does all of this tie in to the 2016 presidential election? It starts, of course,
with Bernie Sanders and Donald Trump, both of whom have channeled voters' frustration and anger with
an economic world that, they feel, has left them behind.
In an interview from London, Mason was quick to dismiss Trump, calling him "a showman and a charlatan
and a racist." He claims that the rise of Trump is proof that neoliberalism is broken. With people
left as adrift as they are, he says, "it's no surprise that an empty can rises like flotsam."
...In many ways, it is remarkable that candidates who speak against free trade the way Sanders
and Trump have have had significant traction this primary election season. But the signs have been
there over the past few years. Wendy Brown, a political scientist at the University of California,
notes that the Occupy movement was among the first to point out the dangers of the neoliberal economic
system.
Republicans, of course, would never go for Mason's suggestions; just this month, John Kasich called
for the "Uberization" of the federal government. Uber, with its limited rights and benefits for drivers,
is in many ways the poster child for the neoliberal dream.
Mason's book offers a stark portrait of a potential future in which inequality grows to unimaginable
heights, leading to social unrest. "I can see within a century the end of the market system as we
know it," Mason says.
That may sound a bit extreme. But in a world where more and more people feel like the economy
has flat out left them behind, it would be foolish to disregard what should come next.
I expect there will be a struggle between the free market fundamentalists and a broader, vastly
more numerous base spanning both blue and white collar working and middle classes. Inequality will
be one driver but there will be others. We have to shake 18th century economics, 19th century industrialism
and 20th century geopolitics - the forces that spawned globalism. These modes of organization are
antiquated and no longer retain much utility. They were conceived during and designed for a much
different world with a far smaller overall population, a surfeit of cheap resources and a far lower
rate of consumption.
We're running into walls, one after another, and these walls are boxing us in, eliminating or
narrowing options and choice. Our obsolete modes of organization, the foundations of neoliberalism
and globalism, have no settings to deal with overpopulation, over-consumption or climate change.
That much is apparent from the manner in which they're based on perpetual, exponential growth. On
a finite biosphere, our Spaceship Earth, the limits of growth are sharply defined and yet, instead
of organizing ourselves accordingly, we keep resorting to sleight of hand, parlour tricks, that lead
to deforestation, desertification, the collapse of major fisheries, the draining of our groundwater
resources - on and on and on.
What I fear most is that the failure of our leadership to acknowledge and respond to these
issues will lead to mass unrest and a population that's easy prey for the first charismatic despot
to come along and feed off their discontent. The fact is that happens more often than not and it
only makes a difficult situation enormously worse.
Thanks for that good post. I look
forward to reading Mason's book. In the UK they have Corbyn, in the US they have Sanders, when
are we going to produces a leader who actually talks about redistribution and fair taxation instead
of towing the neo-liberal line like Mulcair?
Within it is another link "Abundance" - another good read.
Technology may end up speeding-up the destruction of our current form of capitalism. Most don't
understand what's happening until it hits them in the face (like Uber and taxi cabs).
A guaranteed minimum income with corporations forced to pay their fair share of taxes is a
start. Looking forward to a "Star Trek world".
I just looked on Amazon, Kirby, and it's available but seems a bit pricey. You can get the ebook
for about $14. I'll wait until it shows up on Abebooks next year.
@ UU4077 - I did a post the other
day on Galbraith's "The End of Normal" that focused on the chapter dealing with "creative destruction."
This expands upon some of the points made in your links. Galbraith writes of, " new ways for the
information-processing device to perform tasks that used to be carried out by someone else for
money; new ways to kill off activity elsewhere; new ways to devalue somebody else's skill" as
the inevitable result of our rampaging technology.
It's almost never mentioned that Adam Smith,
in his 1776 "The Wealth of Nations," foresaw that the Ponzi scheme that today's capitalism has
become would have a shelf life of about 200-years. Give or take half a century it seems he was
right. From Wiki: "A central theme of the book is the desirable consequences of each person pursuing
self-interest in the marketplace. He theorized and observed that people trading in open markets
leads to production of the right quantities of commodities, division of labor, increasing wages,
and an upward spiral of economic growth. But Smith recognized a limit to economic growth. He predicted
that in the long run, population growth would push wages down, natural resources would become
increasingly scarce, and division of labor would approach the limits of its effectiveness."
After this period, Smith concluded civilization would enter a 'steady state economy' not because
it was particularly desirable or superior but because there would be no other option. It seems
ridiculous to even argue the point but we live on a finite world and the limits of this world
prescribe that the economy must be a subset of that environment. I think we may be on the verge
of discovering that immutable law of nature but possibly much too late.
"... Second, one would have to be extraordinarily naïve to believe that the neoliberal project has been about establishing 'free' markets in the first place, although this myth has been assiduously perpetrated by social democratic parties who, eager to disguise their own capitulation to neoliberalism, emphasize their opposition to the marketisation of all social relationships, even though no-one – except perhaps the followers of Ayn Rand – seriously imagines this is either possible or desirable. ..."
"... There are two foundational aspects of capitalism: the 'horizontal' competition between capitals and the 'vertical' conflict between labour and capital. The role of the capitalist state is to impose a dual social order determined by these two processes: over competing capitals so that market relations do not collapse into 'the war of all against all', and over the conflict between capital and labour so that it continues to be resolved in the interest of the former. Beyond this, states also have to establish 'general conditions of production', which individual competing capitals would be unwilling or unable to provide, including some basic level of technical infrastructure and welfare. These functions are mainly 'internal' to the territory of nation-states, but they must also represent the collective interests of the 'internal' capitalist class 'externally' in relation to other capitalist states and classes, up to and including the conduct of war. ..."
"... Joseph Schumpeter yielded to no-one in his admiration for the heroic entrepreneur, but also noted during the Second World War that, with the possible exception of the United States, the bourgeoisie was so incapable of self-rule that it required a non-bourgeois group as a 'master'. ..."
"... In the case of the UK the regime began, not with Margaret Thatcher's General Election victory in 1979, but around half-way through the preceding Labour Government of 1974–9 and it persists, with variations, to this day, whatever the bleating from Polly Toynbee and others on the liberal left about the supposedly fundamental differences between the two main parties. ..."
"... The answer is in the way in which neoliberalism has reconfigured politics.The necessary distance between the state and capital (or between state managers and capitalists) that Smith, Marx and Schumpeter from their different political perspectives all regarded is being essential for the health of the system, is being minimised. In particular, the regime adoption of timescales associated specifically with the profit-maximising drives of financial capital is important as it indicates the short-termism involved. Three factors are important in producing this tendency. ..."
"... Ironically, one reason for the rise of neoliberalism in the US was a paradoxical outcome of the successful demand for greater democratic accountability during the 1960s and 1970s. This led to the weakening of both congressional committees and party structures, and produced a new breed of 'entrepreneurial politicians' interested in highlighting issues popular with specific audiences which would provide them with a stable following. ..."
"... For all practical purposes then, members of the ruling class in the West are now united in accepting neoliberalism as the only viable way of organising capitalism as an economic system, but they are divided in relation to how capitalism should be organised as a social system. They may all be neoliberals now, but they are not all neoconservatives. ..."
"... Defence of the system is always the principle objective of the bourgeoisie, even at the expense of temporary system malfunction. In a situation where economic desperation was leading to mounting disorder, far-right parties would be brought into play to direct attention from the real source of social anguish onto already-identified scapegoats, no matter what price they exacted in terms of policy. ..."
The neoliberal era can be retrospectively identified as beginning with the
economic crisis of 1973, or, more precisely, with the strategic response of state managers and employers
to that crisis. Previous eras in the history of capitalism have tended to close with the onset of
further period of systemic crisis; 1973, for example, saw the end of the era of state capitalism
which began in 1929. The neoliberal era, however, has not only survived the crisis which began in
2007, but its characteristic features are, if anything, being further extended and embedded, rather
than reversed.
Yet, although neoliberalism has massively increased the wealth of the global capitalist
class, has it also restored the health of the system itself? The crisis which gave rise to neoliberalism
was, after all, caused by the end of the unprecedented period of growth which characterised the post-war
boom, and the consequent accelerating decline in the rate of profit, unimpeded by the countervailing
tendencies – above all arms spending – which had held it in check since the Second World War. These
levels of growth were never resumed, but it would be wrong to claim that capitalism experienced no
recovery after 1973. The boom from 1982 to 2007 was certainly uneven and punctuated by particularly
sharp financial crises and recessions in 1987, 1991, 1997 and 2000; but these were normal expressions
of the business cycle and only a misplaced fixation with using the unique and unrepeatable period
between 1948 and 1973 as a comparator could justify treating these as symptoms of crisis. When crisis
did return in 2007–8, it simply proved that neoliberalism was no more capable of permanently
preventing this than any other mode of capitalist regulation.
Neoliberalism does, however, represent a paradox for capitalism. Its relative success
as a ruling-class strategy, particularly in weakening the trade union movement and reducing the share
of profits going to labour, has helped to disguise that some aspects of this mode of regulation are
proving unintentionally detrimental to the system. Serving the interests of the rich is not the same
– or at least, not always the same – as serving the interests of capital and may, in certain circumstances,
be in contradiction to it. Simply doing what the rich want is unlikely to produce beneficial results
for the system as a whole, although it may help increase the wealth of individual capitalists. For
not only are capitalists generally uninterested in the broader social interest, which we might expect,
but they are also generally incapable of correctly assessing their own overall collective
class interests, which might seem more surprising – although as we shall see, it is a long-standing
phenomenon, observed by many of the great social theorists from late eighteenth century onwards.
As a result, capitalist states – or more precisely, their managers – have traditionally acted to
make such an assessment; but in the developed West at least, neoliberal regimes are increasingly
displaying an uncritical adherence to the short-term wishes of particular business interests. This
is not the only emergent problem: the increasingly narrow parameters of neoliberal politics, where
choice is restricted to 'social' rather than 'economic' issues, has encouraged the emergence of far-right
parties, usually fixated on questions of migration, which have proved enormously divisive in working-class
communities, but whose policies are in other respects by no means in the interests of capital.
The self-destructive nature of neoliberal capitalism has nothing necessarily to do
with the removal of restrictions on markets. The rise of neoliberalism made it fashionable to refer
to Karl Polanyi's The Great Transformation, the assumption being that neoliberalism is in
the process of realising Polanyi's nightmare: reversing the second part of his 'double movement'
– the social reaction against markets – and unleashing the mechanisms that he saw as being so destructive
of society and nature.
Leaving aside the fact that capitalism was always capable of producing social atomization,
collective violence and environmental destruction, even in periods when the state was far more directly
involved in the mechanisms of production and exchange then it is now, there are two problems with
this position. First, rhetoric apart, capitalists no more favour untrammelled competition today than
they did when monopolies and cartels first appeared as aspects of the emerging system in the sixteenth
century. Second, one would have to be extraordinarily naïve to believe that the neoliberal project
has been about establishing 'free' markets in the first place, although this myth has been assiduously
perpetrated by social democratic parties who, eager to disguise their own capitulation to neoliberalism,
emphasize their opposition to the marketisation of all social relationships, even though no-one –
except perhaps the followers of Ayn Rand – seriously imagines this is either possible or desirable.
In what follows I will mainly draw on the experiences of the UK and the US, since these were the
first nation-states in which neoliberalism was imposed under democratic conditions – unlike Chile
or China, for example – and where it has in many respects gone furthest. To understand the real nature
of the difficulties inadvertently caused for capital by neoliberalism we have to begin with the role
of capitalist states 'in general'.
How did capitalist states operate before neoliberalism? There are two foundational
aspects of capitalism: the 'horizontal' competition between capitals and the 'vertical' conflict
between labour and capital. The role of the capitalist state is to impose a dual social order determined
by these two processes: over competing capitals so that market relations do not collapse into 'the
war of all against all', and over the conflict between capital and labour so that it continues to
be resolved in the interest of the former. Beyond this, states also have to establish 'general conditions
of production', which individual competing capitals would be unwilling or unable to provide, including
some basic level of technical infrastructure and welfare. These functions are mainly 'internal' to
the territory of nation-states, but they must also represent the collective interests of the 'internal'
capitalist class 'externally' in relation to other capitalist states and classes, up to and including
the conduct of war.
In order to maintain links to capital in all its multiple incarnations, the state must
partly mirror capital's fragmentation. As this suggests, not every action carried out by the state
need necessarily be in the direct collective interest of the ruling class – indeed, if it is to give
the appearance of adjudicating between different class and other interests then it is essential that
they are not, so long as these actions are ultimately subordinated to ruling class interests.
Nevertheless, the capitalist state has nevertheless tended not to be run by capitalists themselves.
Why not?
The earliest social theorists to concern themselves with the emergent capitalist system
– which they tended to refer to as 'commercial society' – were unambiguous in their assessment of
how narrow business interests were. Since Adam Smith is – quite unfairly – treated as the patron
saint of neoliberalism is may be worth reminding ourselves of his still-refreshingly candid views
about the capacity of business interests for deception and oppression, and their inability to see
beyond their own immediate interests. Nearly a century later in the 1860s, Smith's greatest successor,
Karl Marx, was able to point in Capital to the example of the British Factory Acts as an example
of how the state had to intervene to regulate the activities of capital in the face of initial opposition
from the capitalists themselves. Reflecting on the entire legislative episode, Marx noted the way
in which it took Parliamentary legislation to force capital to accept regulation of the length of
the working day. Indeed, the most irreconcilable positions were expressed not by employers but by
their ideologues, the most important of whom was Herbert Spencer, who saw – and here we can detect
the genuine ancestry of contemporary neoliberalism – the spectre of socialist slavery in any form
of state intervention.
The thesis concerning bourgeois incapacity was not only restricted to critical supporters
of capitalism like Smith or opponents like Marx. Joseph Schumpeter yielded to no-one in his admiration
for the heroic entrepreneur, but also noted during the Second World War that, with the possible exception
of the United States, the bourgeoisie was so incapable of self-rule that it required a non-bourgeois
group as a 'master'. Without the kind of constraints provided by this pre-capitalist framework,
the more sober instincts of the bourgeois would be overcome by the impulse towards what Schumpeter
called 'creative destruction'. The delegation of power to the state therefore exists because of the
inaptitude of the capitalist class compared to other ruling classes in history: feudal lords combine
an economic and political role; capitalists perform only the former – although the necessity for
capitalists to devote their time to the process of accumulation and their own multiple internal divisions
also militate against their functioning directly as a governing class.
Schumpeter was, however, too pessimistic: from the First World War in particular, the
pre-capitalist classes which had acted as the shepherds of capital were increasingly replaced by
state managers: the professional politicians and civil servants respectively responsible for the
legislative and executive wings of the state. At the most fundamental level, the common interest
between capitalists and state managers stems from their common class position: both are part of the
bourgeoisie. If we visualise the bourgeoisie as a series of concentric circles, then the capitalist
class as such (actual owners and controllers of capital) occupies the centre and a series of other
layers radiates outwards, with those closer to the periphery being progressively less directly connected
to the core economic activities of production, exploitation, and competition, and more involved with
those of the ideological, administrative, or technical aspects, which are nevertheless essential
to the reproduction of capitalism. The incomes that state managers are paid from state revenues ultimately
derive from the total social surplus value produced by the working class, as are the profits, interest,
and rent received by different types of private capitalist. And this applies not simply to the source
of their income but also to its level, since the relatively high levels of remuneration, security,
and prestige enjoyed by these officials depend on the continued exploitation of wage labour. At that
level the interests of state managers and capitalist are the same.
These groups have a shared ideological commitment to capitalism, but their particular
interests arise from distinct regions of the totality of capitalism, in its various national manifestations.
A shared background in institutions like schools, universities, and clubs helps to consolidate a
class consciousness that articulates these interests, but a more fundamental reason is that the activities
of states are subordinated to the accumulation of capital. In the British case, the state may not
do this as successfully as the capitalist class might wish, but that is an indication of the problems
of managing long-term relative decline, not that the state managers have different goals. Regardless
of their class origins, state managers and capitalists are drawn together into a series of mutually
supportive relationships. The former need the resources provided by individual national capitals,
principally through taxation and loans, in order to attend to the needs of the national capital as
a whole; the latter need specific policy initiatives to strengthen the competitive position of their
sector of the national capital within the global economy. There have nevertheless always been tensions,
above all the fear on the part of capitalists that states – which they regard as Weberian autonomous
entities with their own interests – will either restrict or abolish their right to private property.
What gives these fears plausibility is precisely the fact that state managers have both to facilitate
the process of capital accumulation and ameliorate its effects on the population and environment,
returning us to the Factory Acts and capitalist responses to them described by Marx in 1867.
Has the neoliberal era seen the capitalist class finally succeeding in 'binding Leviathan',
to quote the title of an early British neoliberal text by William Waldegrave? We need to be clear
that it is not the nature of capitalist states themselves that has changed: they still need to perform
the core functions described at the beginning of this section. There is no 'neoliberal state', but
there are 'neoliberal regimes'. In the case of the UK the regime began, not with Margaret Thatcher's
General Election victory in 1979, but around half-way through the preceding Labour Government of
1974–9 and it persists, with variations, to this day, whatever the bleating from Polly Toynbee and
others on the liberal left about the supposedly fundamental differences between the two main parties.
What has changed is that the relationship between neoliberal regimes and capital since
the 1970s has prevented states from acting effectively in the collective, long-term interest of capitalism.
Neoliberal regimes have increasingly abandoned any attempt to arrive at an overarching understanding
of what the conditions for growth might be, other than the supposed need for lowering taxation and
regulation and raising labour flexibility. Apart from these, the interests of the total national
capital is seen as an arithmetical aggregate of the interests of individual businesses, some of which,
to be sure, have rather more influence with governments than others. In so far as there is a 'strategic
view' it involves avoiding any policies which might incur corporate displeasure, however minor the
inconveniences they might involve for the corporations, which of course includes regulation. These
developments have, not unexpectedly, led to complete incomprehension among remaining Keynesians of
the liberal left such as Ha-Joon Chang and Will Hutton, but they are not beyond explanation. The
reason is not simply because of successful lobbying and PR on behalf of individual businesses or
industries, pernicious and pervasive though these increasingly sophisticated activities undoubtedly
are. But corporations have always done this: why are state managers now so predisposed to respond
positively to their efforts? The answer is in the way in which neoliberalism has reconfigured
politics.The necessary distance between the state and capital (or between state managers and capitalists)
that Smith, Marx and Schumpeter from their different political perspectives all regarded is being
essential for the health of the system, is being minimised. In particular, the regime adoption of
timescales associated specifically with the profit-maximising drives of financial capital is important
as it indicates the short-termism involved. Three factors are important in producing this tendency.
The first is the depoliticization of the political wing of the state managers through
the delegation of functions away from the government in office to ostensibly 'non-political' bodies,
the introduction ostensibly 'objective' assessments of the effectiveness of policy and imposition
of binding 'rules' which restrict the range of actions which politicians can take. In relation to
the latter in particular, each successive phase of the neoliberal experiment saw the incremental
abandonment of the repertoire of measures through which governments had traditionally influenced
economic activity, beginning with Geoffrey Howe's abandonment of exchange controls in 1979 and concluding
(to date) with Gordon Brown's transfer of the power to set interest rates from the Treasury to an
unelected committee of the Bank of England.
As a consequence of their heightened 'managerial' function, politicians have increasingly
become a professional caste whose life-world is increasingly remote from any other form of activity,
economic or otherwise, and therefore more autonomous, while simultaneously becoming more committed
to capitalist conceptions of the national interest, with business as an exemplar. Consequently, most
discussion of politics – in the developed world at least – is devoted to expending more or less informed
commentary and speculation on essentially meaningless exchanges within Parliaments and other supposedly
representative institutions. Debates therefore have the quality of a shadow play, an empty ritual
in which trivial or superficial differences are emphasised in order to give an impression of real
alternatives and justify the continuation of party competition. To understand why, we have to focus
on the weakening of the labor movement, since one of the inadvertent roles which it historically
played was to save capitalism from itself, not least by achieving reforms in relation to education,
health and welfare. These benefitted workers, of course, but also ensured that the reproduction of
the workforce and the conditions for capital accumulation more generally took place. In this respect
social democracy occupied a similar place to the pre-capitalist elites identified by Schumpeter as
necessary to rule on behalf of a congenitally incapable capitalist class. But with the weakening
of trade union power and the capitulation of social democracy to neoliberalism, there is currently
no social force capable of either playing this reformist role directly or by pressurizing non-social
democratic state managers into playing it.
The second factor, opposed to the depoliticization of politicians, is the politicization
of the non-political wing of the state managers: the civil servants. As the political parties became
less distinct from each other, the officials required to implement their increasingly similar policies
are required to turn themselves more completely into extensions of the parties themselves. In the
US, the politicization of the civil service has always been a more significant factor than in the
UK, but even there the neoliberal era saw a heightening of the existing tendency. The permeability
and lack of technocracy of the US state bureaucracy compared to the French or British may have some
advantages for capital, but generally hinders the separation of policy making from political considerations
and leads to the politically motivated choice of budget projections. These tendencies were exacerbated
by the Civil Service Reform Act of 1978 which further weakened the autonomous basis of the government
bureaucracy. In the UK, following hard on the heels of the United States as always, there has been
since 1979, and especially since 1997, a more generalised influx of private-sector appointees into
the civil service, to the point where it has been effectively subject to a corporate takeover. But
even in relation to the permanent home civil service, the expectation that senior civil servants
in particular will not attempt to point out the difficulties involved in governmental policies or
even consider alternative ways of delivering policies, but simply present arguments to justify them,
regardless of the empirical data.
The third and final factor in producing chronic short-termism in neoliberal regimes
is the de-politicization of the electorate. Except it is not so much de-politicization as abstention
by sections of the electorate who no longer have any parties for whom to vote. Many of those electors
still involved in casting their vote do so – appropriately enough – on a consumer model of political
choice, where participation is informed by media-driven perceptions of which result will be to their
immediate personal benefit. Unsurprisingly, the numbers prepared to carry out even this minimal level
of activity are declining. This can be reversed, as was demonstrated in the popular insurgency
for a Yes vote during the 2014 Scottish independence referendum, where 97 percent of population registered
to vote and 85 percent actually did; but under 'normal' conditions, those who vote are more likely
to belong to the middle-classes, who tend to have a more focused view of their material interests
and deploy more interventionist strategies for maintaining them than those bearing the brunt of austerity.
Ironically, one reason for the rise of neoliberalism in the US was a paradoxical outcome of the
successful demand for greater democratic accountability during the 1960s and 1970s. This led to the
weakening of both congressional committees and party structures, and produced a new breed of 'entrepreneurial
politicians' interested in highlighting issues popular with specific audiences which would provide
them with a stable following.
A model for 'returning power to the people' along these lines was built early on in
the neoliberal experiment, in the US. The most fully developed version can be found in California.
Since the mid-1970s, politics in the world's fourth biggest economy have been characterised by a
combination of falling voter participation among working class and minority groups, and a targeted
use of local referendums on 'propositions'. The latter have been designed to defend property values
by blocking integrated schooling and urban development, and by preventing progressive taxation. Proposition
13 was passed in 1978 and signalled the commencement of the neoliberal era in the US by capping taxes
on property, even though house values were rising. As a result, the burden of taxation fell disproportionately
on income tax, even though for most worker's salaries and wages were stagnant or falling – and even
increasing income tax requires a two thirds majority in both Houses of the State Legislature.
It is the self-interested behaviour of a mobilised middle-class that has brought California
to fiscal crisis in 2009, after which the usual remedies of cutting public services, including child
health care, were now being offered as a solution to the structural inability of the state to raise
the necessary levels of taxation. The paralysis of California may foreshadow the future of US politics
as a whole and, in turn, the US may foreshadow the future of politics in the rest of the world, a
development for which there are, unfortunately, historical precedents.
The entire neoliberal project was premised on the irreversibility of the process: the
abolition of regulatory mechanisms, dismantling of welfare programs, ratification of international
treaties for which there are no formal mechanisms allowing them to be either amended or annulled,
and so on – all these could be reversed, but it would require new legal and administrative structures
which would in turn require planning and a political will to do so which has not existed since the
beginning of the neoliberal era. For all practical purposes then, members of the ruling class
in the West are now united in accepting neoliberalism as the only viable way of organising capitalism
as an economic system, but they are divided in relation to how capitalism should be organised
as a social system. They may all be neoliberals now, but they are not all neoconservatives.
In the US both Democrats and Republicans are openly committed to capitalism, but there are also
real divisions of opinion between them concerning, for example, gay rights or environmental protection.
Electoral support for the far-right in these circumstances is based on the apparent
solutions it offers to what are now two successive waves of crisis, beginning respectively in 1973–4
and 2007–8, which have left the working class in the West increasingly fragmented and disorganised,
and susceptible to appeals to blood and nation as the only viable form of collectivism still available,
particularly in a context where any systemic alternative to capitalism – however false it may have
been – had apparently collapsed in 1989–91. The political implications are ominous. The increasing
interchangeability of political parties, discussed above gives the far-right an opening to appeal
to voters by positioning themselves as outside the consensus in ways which speak to popular appetites
for destruction fostered by capitalism itself.
The potential problem for the stability of the capitalist system is however less the
possibility of far-right parties themselves coming to power with a programme destructive to capitalist
needs, than their influence over the mainstream parties of the right, when the beliefs of their supporters
may inadvertently cause difficulty for the accumulation process. Take an important area of Republican
Party support in the US. Since the late sixties Republicans have been increasingly reliant on communities
of fundamentalist Christian believers, whose activism allows them to be mobilised for voting purposes.
But this religious core vote, or at any rate their leadership, naturally also demand the implementation
of policies in return for their support. The problem for the Republicans is not, however, only that
the extremism of fundamentalist Christianity may alienate the electoral 'middle-ground' on which
the results of American elections increasingly depend. What is perhaps interesting here is less the
consciously oppositional elements of right-wing populist ideology, which tend to be directed against
the socio-cultural views of one (liberal) wing of the ruling class, and more what I referred to earlier
as outcomes which might be unintentionally 'detrimental' to capital. In other words, politicians
may be constrained from undertaking policies which may be necessary for American capitalism, or be
forced into taking decisions which may harm it.
But it is not only religious belief which can cause difficulties for US capital; so
to can overt anti-migrant racism. One concrete example of this is the Tea Party-inspired Beason-Hammon
Alabama Taxpayer and Citizen Protection Act – HB56 as it is usually known – which was passed by the
State legislature in June 2011, making it illegal not to carry immigration papers and preventing
anyone without documents from receiving any provisions from the state, including water supply. The
law was intended to prevent and reverse illegal immigration by Hispanics, but the effect was to cause
a mass departure from the many of the agricultural businesses which relied on these workers to form
the bulk of their labour force. But the effects went deeper. Before the laws introduced it was estimated
that 4.2 percent of the workforce or 95,000 people were undocumented but paying $130.3 million in
state and local taxes. Their departure from the state or withdrawal to the black economy threatened
to reduce the size of the local economy by $40 million. Moreover employers had to spend more money
on screening prospective employees, on HR staff to check paperwork, and on insuring for potential
legal liabilities from inadvertent breaches of the law. In an earlier era, social democratic reforms
were usually intended to enable the system as a whole to function more effectively for capitalists
and more equitably for the majority, however irreconcilable these aims may be in reality. But far-right
reforms of the type just discussed are not even intended to work in the interests of capitalists,
nor do they: they really embody irrational racist beliefs which take precedence over all else.
The British Conservative Party has encountered similar problems to the Republicans
in relation to Europe. The imperial nationalism unleashed by the Conservatives before 1997 in relation
to 'Europe', was not because the EU was in any sense hostile to neoliberalism, but as an ideological
diversion from the failure of neoliberalism to transform the fortunes of British capital. The nationalism
invoked for this purpose now places a major obstacle for British politicians and state managers who
want to pursue a strategy of greater European integration, however rational that may be from their
perspective. A 2013 British Chambers of Commerce poll of 4,387 companies showed only eighteen percent
agreeing that full withdrawal from the EU could have a positive impact, while a majority of sixty-four
percent supported remaining inside the EU while repatriating some powers: unsurprisingly, the real
source of anti-EU feeling is small business. The key beneficiary of the anti-European hysteria has
been UKIP and its success has in turn emboldened the right within the Conservative Party, even though
the policies associated with both are incoherent. But these contradictions may not matter in terms
of the political struggle for power. The narrowly-won Swiss referendum vote in 2014 to introduce
quotas on migrants from the EU, passed against the wishes of local capitalists and ruling classes
of Europe and potentially bringing retaliation from Brussels, gives a small indication of what might
follow.
If I am right that certain aspects of far-right politics are counter-productive in
relation to the needs of capital, it does not follow that the increased chaos consequent on the implementation
of these policies would necessarily be of benefit, even indirectly, to the left. Defence of the
system is always the principle objective of the bourgeoisie, even at the expense of temporary system
malfunction. In a situation where economic desperation was leading to mounting disorder, far-right
parties would be brought into play to direct attention from the real source of social anguish onto
already-identified scapegoats, no matter what price they exacted in terms of policy.
What we see emerging is a symbiotic relationship between one increasingly inadequate
regime response to the problems of capital accumulation and another increasingly extreme response
to the most irrational desires and prejudices produced by capital accumulation. In Descent,
the most recent novel by the Scottish science fiction author, Ken McLeod, the author imagines a situation
in the near future where the ruling classes of the world take coordinated legal and military action
in a passive revolution ('the Big Deal') to smash the dominance of financial capital, restore that
of industrial capital and essentially put an end to the neoliberal era. This aspect of the novel
is far more incredible than the alien encounters that occur elsewhere in its pages. Clearly, in situations
of absolute, immediate crisis, short-term emergency measures would be introduced in the same way
as the effective nationalisation of banks and other financial institutions took place in both the
US and UK during 2008. But these were minimal interventions to prevent outright collapse, save the
institutions (and the practices which brought them to the point of crisis in the first place) without
using them for any coherent strategic end, let alone any broader social purpose; and of course on
the basis that they would be re-privatised as soon as possible.
Let me clear what I am not saying. I am not suggesting that it should be the work of
socialists to propose solutions to the crisis of capitalism. It is always necessary to argue for
reforms, of course, but the idea that the application of Keynesian solutions would restore the Golden
Age of the post-war welfare state is simply illusionary and underestimates the extent to which those
years were the result of a unique set of circumstances. Booms will continue to occur, as they did
between 1982 and 2007, but the beneficiaries will become fewer and fewer. Consequently, I am not
predicting that developments discussed here mean that capitalism will simply collapse under the weight
of its own internal contradictions either. Scenarios of this type, from those of Rosa Luxemburg onwards,
have been proved false in the past and there is no reason to suppose that they will be any more accurate
in the future. Indeed, a collapse not brought about by the conscious intervention of the oppressed
and exploited would not be to their advantage in any case, but simply a step towards the barbarism
to which Marxists from Engels onwards have seen as the consequence of failing to achieve a socialist
society. And this is no mere slogan: the condition of central Africa and parts of the Middle East
today indicates the presence of actually existing barbarism as the daily reality for millions. Events
in the developed world are unlikely to take this form, at least until environmental catastrophe becomes
irreversible, but rather involve a gradual and, for all but the very poorest, almost imperceptible
worsening and coarsening on their conditions of life.
What I am suggesting is that neoliberalism as a strategy has almost been too successful
as a method of capitalist regulation. It has finally brought about the situation that Schumpeter
feared, where creative destruction has no limits or boundaries. Both Engels and Benjamin envisaged
capitalism as a runaway train heading for destruction. It appeared, within less than a decade of
the latter's suicide in 1940, that forces within capitalism itself were capable of 'pulling the hand
break'; it now appears that his initial intuition was right and that revolution is all stands in
the way of the disaster that otherwise awaits.
Neil Davidson lectures in Sociology with the School of Social and Political Sciences
at the University of Glasgow. He is the author of The Origins of Scottish Nationhood (2000), the
Deutscher-Prize winning Discovering the Scottish Revolution (2003), How Revolutionary Were the Bourgeois
Revolutions? and Holding Fast to an Image of the Past (2014). His latest book, We Cannot Escape History,
will be published in July. Davidson has co-edited and contributed to Alasdair MacIntyre's Engagement
with Marxism (2008), Neoliberal Scotland (2010) and The Longue Durée of the Far Right (2014). He
is in the editorial board of rs21. Davidson is a member of International Socialists Scotland and
a supporter of the Scottish Left Project.
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No one asks these questions because they seem absurd. Yet, no one can escape
them either. Until the onslaught of the global economic crisis, the motto of
so-called "neoliberalism" was TINA: "There Is No Alternative!"
No alternative to "neoliberal globalization"?
No alternative to the unfettered "free market" economy?
What Is "Neoliberal Globalization"?
Let us first clarify what globalization and neoliberalism are, where they
come from, who they are directed by, what they claim, what they do, why their
effects are so fatal, why they will fail and why people nonetheless cling to
them. Then, let us look at the responses of those who are not – or will not
– be able to live with the consequences they cause.
This is where the difficulties begin. For a good twenty years now we have
been told that there is no alternative to neoliberal globalization, and that,
in fact, no such alternative is needed either. Over and over again, we have
been confronted with the TINA-concept: "There Is No Alternative!" The "iron
lady", Margaret Thatcher, was one of those who reiterated this belief without
end.
The TINA-concept prohibits all thought. It follows the rationale that there
is no point in analyzing and discussing neoliberalism and so-called globalization
because they are inevitable. Whether we condone what is happening or not does
not matter, it is happening anyway. There is no point in trying to understand.
Hence: Go with it! Kill or be killed!
Some go as far as suggesting that globalization – meaning, an economic system
which developed under specific social and historical conditions – is nothing
less but a law of nature. In turn, "human nature" is supposedly reflected by
the character of the system's economic subjects: egotistical, ruthless, greedy
and cold. This, we are told, works towards everyone's benefit.
The question remains: why has Adam Smith's "invisible hand" become a "visible
fist"? While a tiny minority reaps enormous benefits from today's neoliberalism
(none of which will remain, of course), the vast majority of the earth's population
suffers hardship to the extent that their very survival is at stake. The damage
done seems irreversible.
All over the world media outlets – especially television stations – avoid
addressing the problem. A common excuse is that it cannot be explained.[1] The
true reason is, of course, the media's corporate control.
What Is Neoliberalism?
Neoliberalism as an economic policy agenda which began in Chile in 1973.
Its inauguration consisted of a U.S.-organized coup against a democratically
elected socialist president and the installment of a bloody military dictatorship
notorious for systematic torture. This was the only way to turn the neoliberal
model of the so-called "Chicago Boys" under the leadership of Milton Friedman
– a student of Friedrich von Hayek – into reality.
The predecessor of the neoliberal model is the economic liberalism of the
18th and 19th centuries and its notion of "free trade". Goethe's assessment
at the time was: "Free trade, piracy, war – an inseparable three!"[2]
At the center of both old and new economic liberalism lies:
Self-interest and individualism; segregation of ethical principles and economic
affairs, in other words: a process of 'de-bedding' economy from society; economic
rationality as a mere cost-benefit calculation and profit maximization; competition
as the essential driving force for growth and progress; specialization and the
replacement of a subsistence economy with profit-oriented foreign trade ('comparative
cost advantage'); and the proscription of public (state) interference with market
forces.[3]
Where the new economic liberalism outdoes the old is in its global claim.
Today's economic liberalism functions as a model for each and everyone: all
parts of the economy, all sectors of society, of life/nature itself. As a consequence,
the once "de-bedded" economy now claims to "im-bed" everything, including political
power. Furthermore, a new twisted "economic ethics" (and with it a certain idea
of "human nature") emerges that mocks everything from so-called do-gooders to
altruism to selfless help to care for others to a notion of responsibility.[4]
This goes as far as claiming that the common good depends entirely on the
uncontrolled egoism of the individual and, especially, on the prosperity of
transnational corporations. The allegedly necessary "freedom" of the economy
– which, paradoxically, only means the freedom of corporations – hence consists
of a freedom from responsibility and commitment to society.
The maximization of profit itself must occur within the shortest possible
time; this means, preferably, through speculation and "shareholder value". It
must meet as few obstacles as possible. Today, global economic interests outweigh
not only extra-economic concerns but also national economic considerations since
corporations today see themselves beyond both community and nation.[5] A "level
playing field" is created that offers the global players the best possible conditions.
This playing field knows of no legal, social, ecological, cultural or national
"barriers".[6] As a result, economic competition plays out on a market that
is free of all non-market, extra-economic or protectionist influences – unless
they serve the interests of the big players (the corporations), of course. The
corporations' interests – their maximal growth and progress – take on complete
priority. This is rationalized by alleging that their well-being means the well-being
of small enterprises and workshops as well.
The difference between the new and the old economic liberalism can first
be articulated in quantitative terms: after capitalism went through a series
of ruptures and challenges – caused by the "competing economic system", the
crisis of capitalism, post-war "Keynesianism" with its social and welfare state
tendencies, internal mass consumer demand (so-called Fordism), and the objective
of full employment in the North. The liberal economic goals of the past are
now not only euphorically resurrected but they are also "globalized". The main
reason is indeed that the competition between alternative economic systems is
gone. However, to conclude that this confirms the victory of capitalism and
the "golden West" over "dark socialism" is only one possible interpretation.
Another – opposing – interpretation is to see the "modern world system" (which
contains both capitalism and socialism) as having hit a general crisis which
causes total and merciless competition over global resources while leveling
the way for investment opportunities, i.e. the valorization of capital.[7]
The ongoing globalization of neoliberalism demonstrates which interpretation
is right. Not least, because the differences between the old and the new economic
liberalism can not only be articulated in quantitative terms but in qualitative
ones too. What we are witnessing are completely new phenomena: instead of a
democratic "complete competition" between many small enterprises enjoying the
freedom of the market, only the big corporations win. In turn, they create new
market oligopolies and monopolies of previously unknown dimensions. The market
hence only remains free for them, while it is rendered unfree for all others
who are condemned to an existence of dependency (as enforced producers, workers
and consumers) or excluded from the market altogether (if they have neither
anything to sell or buy). About fifty percent of the world's population fall
into this group today, and the percentage is rising.[8]
Anti-trust laws have lost all power since the transnational corporations
set the norms. It is the corporations – not "the market" as an anonymous mechanism
or "invisible hand" – that determine today's rules of trade, for example prices
and legal regulations. This happens outside any political control. Speculation
with an average twenty percent profit margin edges out honest producers who
become "unprofitable".[9] Money becomes too precious for comparatively non-profitable,
long-term projects,
or projects that only – how audacious! – serve a good life. Money instead
"travels upwards" and disappears. Financial capital determines more and more
what the markets are and do.[10] By delinking the dollar from the price of gold,
money creation no longer bears a direct relationship to production".[11] Moreover,
these days most of us are – exactly like all governments – in debt. It is financial
capital that has all the money – we have none.[12]
Small, medium, even some bigger enterprises are pushed out of the market,
forced to fold or swallowed by transnational corporations because their performances
are below average in comparison to speculation – rather: spookulation – wins.
The public sector, which has historically been defined as a sector of not-for-profit
economy and administration, is "slimmed" and its "profitable" parts ("gems")
handed to corporations (privatized). As a consequence, social services that
are necessary for our existence disappear. Small and medium private businesses
– which, until recently, employed eighty percent of the workforce and provided
normal working conditions – are affected by these developments as well. The
alleged correlation between economic growth and secure employment is false.
When economic growth is accompanied by the mergers of businesses, jobs are lost.[13]
If there are any new jobs, most are precarious, meaning that they are only
available temporarily and badly paid. One job is usually not enough to make
a living.[14] This means that the working conditions in the North become akin
to those in the South, and the working conditions of men akin to those of women
– a trend diametrically opposed to what we have always been told. Corporations
now leave for the South (or East) to use cheap – and particularly female – labor
without union affiliation. This has already been happening since the 1970s in
the "Export Processing Zones" (EPZs, "world market factories" or "maquiladoras"),
where most of the world's computer chips, sneakers, clothes and electronic goods
are produced.[15] The EPZs lie in areas where century-old colonial-capitalist
and authoritarian-patriarchal conditions guarantee the availability of cheap
labor.[16] The recent shift of business opportunities from consumer goods to
armaments is a particularly troubling development.[17]
It is not only commodity production that is "outsourced" and located in the
EPZs, but service industries as well. This is a result of the so-called Third
Industrial Revolution, meaning the development of new information and communication
technologies. Many jobs have disappeared entirely due to computerization, also
in administrative fields.[18] The combination of the principles of "high tech"
and "low wage"/"no wage" (always denied by "progress" enthusiasts) guarantees
a "comparative cost advantage" in foreign trade. This will eventually lead to
"Chinese wages" in the West. A potential loss of Western consumers is not seen
as a threat. A corporate economy does not care whether consumers are European,
Chinese or Indian.
The means of production become concentrated in fewer and fewer hands, especially
since finance capital – rendered precarious itself – controls asset values ever
more aggressively. New forms of private property are created, not least through
the "clearance" of public property and the transformation of formerly public
and small-scale private services and industries to a corporate business sector.
This concerns primarily fields that have long been (at least partly) excluded
from the logic of profit – e.g. education, health, energy or water supply/disposal.
New forms of so-called enclosures emerge from today's total commercialization
of formerly small-scale private or public industries and services, of the "commons",
and of natural resources like oceans, rain forests, regions of genetic diversity
or geopolitical interest (e.g. potential pipeline routes), etc.[19] As far as
the new virtual spaces and communication networks go, we are witnessing frantic
efforts to bring these under private control as well.[20]
All these new forms of private property are essentially created by (more
or less) predatory forms of appropriation. In this sense, they are a continuation
of the history of so-called original accumulation which has expanded globally,
in accordance with to the motto: "Growth through expropriation!"[21]
Most people have less and less access to the means of production, and so
the dependence on scarce and underpaid work increases. The destruction of the
welfare state also destroys the notion that individuals can rely on the community
to provide for them in times of need. Our existence relies exclusively on private,
i.e. expensive, services that are often of much worse quality and much less
reliable than public services. (It is a myth that the private always outdoes
the public.) What we are experiencing is undersupply formerly only known by
the colonial South. The old claim that the South will eventually develop into
the North is proven wrong. It is the North that increasingly develops into the
South. We are witnessing the latest form of "development", namely, a world system
of underdevelopment.[22] Development and underdevelopment go hand in hand.[23]
This might even dawn on "development aid" workers soon.
It is usually women who are called upon to counterbalance underdevelopment
through increased work ("service provisions") in the household. As a result,
the workload and underpay of women takes on horrendous dimensions: they do unpaid
work inside their homes and poorly paid "housewifized" work outside.[24] Yet,
commercialization does not stop in front of the home's doors either. Even housework
becomes commercially co-opted ("new maid question"), with hardly any financial
benefits for the women who do the work.[25]
Not least because of this, women are increasingly coerced into prostitution,
one of today's biggest global industries.[26] This illustrates two things: a)
how little the "emancipation" of women actually leads to "equal terms" with
men; and b) that "capitalist development" does not imply increased "freedom"
in wage labor relations, as the Left has claimed for a long time.[27] If the
latter were the case, then neoliberalism would mean the voluntary end of capitalism
once it reaches its furthest extension. This, however, does not appear likely.
Today, hundreds of millions of quasi-slaves, more than ever before, exist
in the "world system."[28] The authoritarian model of the "Export Processing
Zones" is conquering the East and threatening the North. The redistribution
of wealth runs ever more – and with ever accelerated speed – from the bottom
to the top. The gap between the rich and the poor has never been wider. The
middle classes disappear. This is the situation we are facing.
It becomes obvious that neoliberalism marks not the end of colonialism but,
to the contrary, the colonization of the North. This new "colonization of the
world"[29] points back to the beginnings of the "modern world system" in the
"long 16th century", when the conquering of the Americas, their exploitation
and colonial transformation allowed for the rise and "development" of Europe.[30]
The so-called "children's diseases" of modernity keep on haunting it, even in
old age. They are, in fact, the main feature of modernity's latest stage. They
are expanding instead of disappearing.
Where there is no South, there is no North; where there is no periphery,
there is no center; where there is no colony, there is no – in any case no "Western"
– civilization.[31]
Austria is part of the world system too. It is increasingly becoming a corporate
colony (particularly of German corporations). This, however, does not keep it
from being an active colonizer itself, especially in the East.[32]
Social, cultural, traditional and ecological considerations are abandoned
and give way to a mentality of plundering. All global resources that we still
have – natural resources, forests, water, genetic pools – have turned into objects
of utilization. Rapid ecological destruction through depletion is the consequence.
If one makes more profit by cutting down trees than by planting them, then there
is no reason not to cut them.[33] Neither the public nor the state interferes,
despite global warming and the obvious fact that the clearing of the few remaining
rain forests will irreversibly destroy the earth's climate – not to mention
the many other negative effects of such actions.[34] Climate, animal, plants,
human and general ecological rights are worth nothing compared to the interests
of the corporations – no matter that the rain forest is not a renewable resource
and that the entire earth's ecosystem depends on it. If greed, and the rationalism
with which it is economically enforced, really was an inherent anthropological
trait, we would have never even reached this day.
The commander of the Space Shuttle that circled the earth in 2005 remarked
that "the center of Africa was burning". She meant the Congo, in which the last
great rain forest of the continent is located. Without it there will be no more
rain clouds above the sources of the Nile. However, it needs to disappear in
order for corporations to gain free access to the Congo's natural resources
that are the reason for the wars that plague the region today. After all, one
needs diamonds and coltan for mobile phones.
Today, everything on earth is turned into commodities, i.e. everything becomes
an object of "trade" and commercialization (which truly means liquidation, the
transformation of all into liquid money). In its neoliberal stage it is not
enough for capitalism to globally pursue less cost-intensive and preferably
"wageless" commodity production. The objective is to transform everyone and
everything into commodities, including life itself.[35] We are racing blindly
towards the violent and absolute conclusion of this "mode of production", namely
total capitalization/liquidation by "monetarization".[36]
We are not only witnessing perpetual praise of the market – we are witnessing
what can be described as "market fundamentalism". People believe in the market
as if it was a god. There seems to be a sense that nothing could ever happen
without it. Total global maximized accumulation of money/capital as abstract
wealth becomes the sole purpose of economic activity. A "free" world market
for everything has to be established – a world market that functions according
to the interests of the corporations and capitalist money. The installment of
such a market proceeds with dazzling speed. It creates new profit possibilities
where they have not existed before, e.g. in Iraq, Eastern Europe or China.
One thing remains generally overlooked: the abstract wealth created for accumulation
implies the destruction of nature as concrete wealth. The result is a "hole
in the ground" and next to it a garbage dump with used commodities, outdated
machinery and money without value.[37] However, once all concrete wealth (which
today consists mainly of the last natural resources) will be gone, abstract
wealth will disappear as well. It will, in Marx's words, "evaporate". The fact
that abstract wealth is not real wealth will become obvious, and so will the
answer to the question of which wealth modern economic activity has really created.
In the end it is nothing but monetary wealth (and even this mainly exists virtually
or on accounts) that constitutes a monoculture controlled by a tiny minority.
Diversity is suffocated and millions of people are left wondering how to survive.
And really: how do you survive with neither resources nor means of production
nor money?
The nihilism of our economic system is evident. The whole world will be transformed
into money – and then it will disappear. After all, money cannot be eaten. What
no one seems to consider is the fact that it is impossible to re-transform commodities,
money, capital and machinery into nature or concrete wealth. It seems that underlying
all "economic development" is the assumption that "resources", the "sources
of wealth",[38] are renewable and everlasting – just like the "growth" they
create.[39]
The notion that capitalism and democracy are one is proven a myth by neoliberalism
and its "monetary totalitarianism".[40]
The primacy of politics over economy has been lost. Politicians of all parties
have abandoned it. It is the corporations that dictate politics. Where corporate
interests are concerned, there is no place for democratic convention or community
control. Public space disappears. The res publica turns into a res privata,
or – as we could say today – a res privata transnationale (in its original Latin
meaning, privare means "to deprive"). Only those in power still have rights.
They give themselves the licenses they need, from the "license to plunder" to
the "license to kill".[41] Those who get in their way or challenge their "rights"
are vilified, criminalized and to an increasing degree defined as "terrorists"
or, in the case of defiant governments, as "rogue states" – a label that usually
implies threatened or actual military attack, as we can see in the cases of
Yugoslavia, Afghanistan and Iraq, and maybe Syria and Iran in the near future.
U.S. President Bush had even spoken of the possibility of "preemptive" nuclear
strikes should the U.S. feel endangered by weapons of mass destruction.[42]
The European Union did not object.[43]
Neoliberalism and war are two sides of the same coin.[44] Free trade, piracy
and war are still "an inseparable three" – today maybe more so than ever. War
is not only "good for the economy" but is indeed its driving force and can be
understood as the "continuation of economy with other means".[45] War and economy
have become almost indistinguishable.[46] Wars about resources – especially
oil and water – have already begun.[47] The Gulf Wars are the most obvious examples.
Militarism once again appears as the "executor of capital accumulation" – potentially
everywhere and enduringly.[48]
Human rights and rights of sovereignty have been transferred from people,
communities and governments to corporations.[49] The notion of the people as
a sovereign body has practically been abolished. We have witnessed a coup of
sorts. The political systems of the West and the nation state as guarantees
for and expression of the international division of labor in the modern world
system are increasingly dissolving.[50] Nation states are developing into "periphery
states" according to the inferior role they play in the proto-despotic "New
World Order".[51] Democracy appears outdated. After all, it "hinders business".[52]
The "New World Order" implies a new division of labor that does no longer
distinguish between North and South, East and West – today, everywhere is South.
An according International Law is established which effectively functions from
top to bottom ("top-down") and eliminates all local and regional communal rights.
And not only that: many such rights are rendered invalid both retroactively
and for the future.[53]
The logic of neoliberalism as a sort of totalitarian neo-mercantilism is
that all resources, all markets, all money, all profits, all means of production,
all "investment opportunities", all rights and all power belong to the corporations
only. To paraphrase Richard Sennett: "Everything to the Corporations!"[54] One
might add: "Now!"
The corporations are free to do whatever they please with what they get.
Nobody is allowed to interfere. Ironically, we are expected to rely on them
to find a way out of the crisis we are in. This puts the entire globe at risk
since responsibility is something the corporations do not have or know. The
times of social contracts are gone.[55] In fact, pointing out the crisis alone
has become a crime and all critique will soon be defined as "terror" and persecuted
as such.[56]
IMF Economic Medicine
Since the 1980s, it is mainly the Structural Adjustment Programs (SAPs) of
the World Bank and the IMF that act as the enforcers of neoliberalism. These
programs are levied against the countries of the South which can be extorted
due to their debts. Meanwhile, numerous military interventions and wars help
to take possession of the assets that still remain, secure resources, install
neoliberalism as the global economic politics, crush resistance movements (which
are cynically labeled as "IMF uprisings"), and facilitate the lucrative business
of reconstruction.[57]
In the 1980s, Ronald Reagan and Margaret Thatcher introduced neoliberalism
in Anglo-America. In 1989, the so-called "Washington Consensus" was formulated.
It claimed to lead to global freedom, prosperity and economic growth through
"deregulation, liberalization and privatization". This has become the credo
and promise of all neoliberals. Today we know that the promise has come true
for the corporations only – not for anybody else.
In the Middle East, the Western support for Saddam Hussein in the war between
Iraq and Iran in the 1980s, and the Gulf War of the early 1990s, announced the
permanent U.S. presence in the world's most contested oil region.
In continental Europe, neoliberalism began with the crisis in Yugoslavia
caused by the Structural Adjustment Programs (SAPs) of the World Bank and the
IMF. The country was heavily exploited, fell apart and finally beset by a civil
war over its last remaining resources.[58] Since the NATO war in 1999, the Balkans
are fragmented, occupied and geopolitically under neoliberal control.[59] The
region is of main strategic interest for future oil and gas transport from the
Caucasus to the West (for example the "Nabucco" gas pipeline that is supposed
to start operating from the Caspian Sea through Turkey and the Balkans by 2011.[60]
The reconstruction of the Balkans is exclusively in the hands of Western corporations.
All governments, whether left, right, liberal or green, accept this. There
is no analysis of the connection between the politics of neoliberalism, its
history, its background and its effects on Europe and other parts of the world.
Likewise, there is no analysis of its connection to the new militarism.
NOTES
[1] Maria Mies and Claudia von Werlhof (Hg), Lizenz zum Plündern. Das Multilaterale
Abkommen über Investitionen MAI. Globalisierung der Konzernherrschaft – und
was wir dagegen tun können, Hamburg, EVA, 2003 (1998), p. 23, 36.
[2] Johann Wolfgang von Goethe, Faust: Part Two, New York, Oxford University
Press, 1999.
[3] Maria Mies, Krieg ohne Grenzen. Die neue Kolonisierung der Welt, Köln,
PapyRossa, 2005, p. 34.
[4] Arno Gruen, Der Verlust des Mitgefühls. Über die Politik der Gleichgültigkeit,
München, 1997, dtv.
[5] Sassen Saskia, "Wohin führt die Globalisierung?," Machtbeben, 2000, Stuttgart-München,
DVA.
[6] Maria Mies and Claudia von Werlhof (Hg), Lizenz zum Plündern. Das Multilaterale
Abkommen über Investitionen MAI. Globalisierung der Konzernherrschaft – und
was wir dagegen tun können, Hamburg, EVA, 2003 (1998), p. 24.
[7] Immanuel Wallerstein, Aufstieg und künftiger Niedergang des kapitalistischen
Weltsystems, in Senghaas, Dieter: Kapitalistische Weltökonomie. Kontroversen
über ihren Ursprung und ihre Entwicklungsdynamik, Frankfurt, 1979, Suhrkamp;
Immanuel Wallerstein (Hg), The Modern World-System in the Longue Durée, Boulder/
London; Paradigm Publishers, 2004.
[8] Susan George, im Vortrag, Treffen von Gegnern und Befürwortern der Globalisierung
im Rahmen der Tagung des WEF (World Economic Forum), Salzburg, 2001.
[9] Elmar Altvater, Das Ende des Kapitalismus, wie wir ihn kennen, Münster,
Westfälisches Dampfboot, 2005.
[10] Elmar Altvater and Birgit Mahnkopf, Grenzen der Globalisierung. Ökonomie,
Ökologie und Politik in der Weltgesellschaft, Münster, Westfälisches Dampfboot,
1996.
[11] Bernard Lietaer, Jenseits von Gier und Knappheit, Interview mit Sarah
van Gelder, 2006,
www.transaction.net/press/interviews/Lietaer 0497.html; Margrit Kennedy,
Geld ohne Zinsen und Inflation, Steyerberg, Permakultur, 1990.
[12] Helmut Creutz, Das Geldsyndrom. Wege zur krisenfreien Marktwirtschaft,
Frankfurt, Ullstein, 1995.
[13] Maria Mies and Claudia von Werlhof (Hg), Lizenz zum Plündern. Das Multilaterale
Abkommen über Investitionen MAI. Globalisierung der Konzernherrschaft – und
was wir dagegen tun können, Hamburg, EVA, 2003 (1998), p. 7.
[14] Barbara Ehrenreich, Arbeit poor. Unterwegs in der Dienstleistungsgesellschaft,
München, Kunstmann, 2001.
[15] Folker Fröbel, Jürgen Heinrichs, and Otto Kreye, Die neue internationale
Arbeitsteilung. Strukturelle Arbeitslosigkeit in den Industrieländern und die
Industrialisierung der Entwicklungsländer, Reinbek, Rowohlt, 1977.
[16] Veronika Bennholdt-Thomsen, Maria Mies, and Claudia von Werlhof, Women,
The Last Colony, London/ New Delhi, Zed Books, 1988.
[17] Michel Chossudovsky, War and Globalization. The Truth Behind September
11th, Oro, Ontario, Global Outlook, 2003.
[18] Folker Fröbel, Jürgen Heinrichs, and Otto Kreye, Die neue internationale
Arbeitsteilung. Strukturelle Arbeitslosigkeit in den Industrieländern und die
Industrialisierung der Entwicklungsländer, Reinbek, Rowohlt, 1977.
[19] Ana Isla, The Tragedy of the Enclosures: An Eco-Feminist Perspective
on Selling Oxygen and Prostitution in Costa Rica, Man., Brock Univ., Sociology
Dpt., St. Catherines, Ontario, Canada, 2005.
[20] John Hepburn, Die Rückeroberung von Allmenden – von alten und von neuen,
übers. Vortrag bei, Other Worlds Conference; Univ. of Pennsylvania; 28./29.4,
2005.
[21] Claudia von Werlhof, Was haben die Hühner mit dem Dollar zu tun? Frauen
und Ökonomie, München, Frauenoffensive, 1991; Claudia von Werlhof, MAInopoly:
Aus Spiel wird Ernst, in Mies/Werlhof, 2003, p. 148-192.
[22] Andre Gunder Frank, Die Entwicklung der Unterentwicklung, in ders. u.a.,
Kritik des bürgerlichen Antiimperialismus, Berlin, Wagenbach, 1969.
[23] Maria Mies, Krieg ohne Grenzen, Die neue Kolonisierung der Welt, Köln,
PapyRossa, 2005.
[24] Veronika Bennholdt-Thomsen, Maria Mies, and Claudia von Werlhof, Women,
the Last Colony, London/New Delhi, Zed Books, 1988.
[25] Claudia von Werlhof, Frauen und Ökonomie. Reden, Vorträge 2002-2004,
Themen GATS, Globalisierung, Mechernich, Gerda-Weiler-Stiftung, 2004.
[26] Ana Isla, "Women and Biodiversity as Capital Accumulation: An Eco-Feminist
View," Socialist Bulletin, Vol. 69, Winter, 2003, p. 21-34; Ana Isla, The Tragedy
of the Enclosures: An Eco-Feminist Perspective on Selling Oxygen and Prostitution
in Costa Rica, Man., Brock Univ., Sociology Department, St. Catherines, Ontario,
Canada, 2005.
[27] Immanuel Wallerstein, Aufstieg und künftiger Niedergang des kapitalistischen
Weltsystems, in Senghaas, Dieter: Kapitalistische Weltökonomie. Kontroversen
über ihren Ursprung und ihre Entwicklungsdynamik, Frankfurt, Suhrkamp, 1979.
[28] Kevin Bales, Die neue Sklaverei, München, Kunstmann, 2001.
[29] Maria Mies, Krieg ohne Grenzen, Die neue Kolonisierung der Welt, Köln,
PapyRossa, 2005.
[30] Immanuel Wallerstein, Aufstieg und künftiger Niedergang des kapitalistischen
Weltsystems, in Senghaas, Dieter: Kapitalistische Weltökonomie. Kontroversen
über ihren Ursprung und ihre Entwicklungsdynamik, Frankfurt, Suhrkamp, 1979;
Andre Gunder Frank, Orientierung im Weltsystem, Von der Neuen Welt zum Reich
der Mitte, Wien, Promedia, 2005; Maria Mies, Patriarchy and Accumulation on
a World Scale, Women in the International Division of Labour, London, Zed Books,
1986.
[31] Claudia von Werlhof, "Questions to Ramona," in Corinne Kumar (Ed.),
Asking, We Walk. The South as New Political Imaginary, Vol. 2, Bangalore, Streelekha,
2007, p. 214-268
[32] Hannes Hofbauer, Osterweiterung. Vom Drang nach Osten zur peripheren
EU-Integration, Wien, Promedia, 2003; Andrea Salzburger, Zurück in die Zukunft
des Kapitalismus, Kommerz und Verelendung in Polen, Frankfurt – New York, Peter
Lang Verlag, 2006.
[34] August Raggam, Klimawandel, Biomasse als Chance gegen Klimakollaps und
globale Erwärmung, Graz, Gerhard Erker, 2004.
[35] Immanuel Wallerstein, Aufstieg und künftiger Niedergang des kapitalistischen
Weltsystems, in Senghaas, Dieter: Kapitalistische Weltökonomie. Kontroversen
über ihren Ursprung und ihre Entwicklungsdynamik, Frankfurt, Suhrkamp, 1979.
[36] Renate Genth, Die Bedrohung der Demokratie durch die Ökonomisierung
der Politik, feature für den Saarländischen Rundfunk am 4.3., 2006.
[37] Johan Galtung, Eurotopia, Die Zukunft eines Kontinents, Wien, Promedia,
1993.
[38] Karl Marx, Capital, New York, Vintage, 1976.
[39] Claudia von Werlhof, Loosing Faith in Progress: Capitalist Patriarchy
as an "Alchemical System," in Bennholdt-Thomsen et.al.(Eds.), There is an Alternative,
2001, p. 15-40.
[40] Renate Genth, Die Bedrohung der Demokratie durch die Ökonomisierung
der Politik, feature für den Saarländischen Rundfunk am 4.3., 2006.
[41] Maria Mies and Claudia von Werlhof (Hg), Lizenz zum Plündern. Das Multilaterale
Abkommen über Investitionen MAI. Globalisierung der Konzernherrschaft – und
was wir dagegen tun können, Hamburg, EVA, 2003 (1998), p. 7; Maria Mies, Krieg
ohne Grenzen, Die neue Kolonisierung der Welt, Köln, PapyRossa, 2005.
[42] Michel Chossudovsky, America's "War on Terrorism," Montreal, Global
Research, 2005.
[43] Michel Chossudovsky, "Nuclear War Against Iran," Global Research, Center
for Research on Globalization, Ottawa 13.1, 2006.
[44] Altvater, Chossudovsky, Roy, Serfati, Globalisierung und Krieg, Sand
im Getriebe 17, Internationaler deutschsprachiger Rundbrief der ATTAC – Bewegung,
Sonderausgabe zu den Anti-Kriegs-Demonstrationen am 15.2., 2003; Maria Mies,
Krieg ohne Grenzen, Die neue Kolonisierung der Welt, Köln, PapyRossa, 2005.
[45] Hazel Hendersen, Building a Win-Win World. Life Beyond Global Economic
Warfare, San Francisco, 1996.
[46] Claudia von Werlhof, Vom Wirtschaftskrieg zur Kriegswirtschaft. Die
Waffen der, Neuen-Welt-Ordnung, in Mies 2005, p. 40-48.
[47] Michael T. Klare, Resource Wars. The New Landscape of Global Conflict,
New York, Henry Holt and Company, 2001.
[48] Rosa Luxemburg, Die Akkumulation des Kapitals, Frankfurt, 1970.
[49] Tony Clarke, Der Angriff auf demokratische Rechte und Freiheiten, in
Mies/Werlhof, 2003, p. 80-94.
[50] Sassen Saskia, Machtbeben. Wohin führt die Globalisierung?, Stuttgart-München,
DVA, 2000.
[51] Michael Hardt and Antonio Negri, Empire, Cambridge, Harvard Univ. Press,
2001; Noam Chomsky, Hybris. Die endgültige Sicherstellung der globalen –Vormachtstellung
der USA, Hamburg-Wien, Europaverlag, 2003.
[52] Claudia von Werlhof, Speed Kills!, in Dimmel/Schmee, 2005, p. 284-292
[53] See the "roll back" and "stand still" clauses in the WTO agreements
in Maria Mies and Claudia von Werlhof (Hg), Lizenz zum Plündern. Das Multilaterale
Abkommen über Investitionen MAI. Globalisierung der Konzernherrschaft – und
was wir dagegen tun können, Hamburg, EVA, 2003.
[54] Richard Sennett, zit. "In Einladung zu den Wiener Vorlesungen," 21.11.2005:
Alternativen zur neoliberalen Globalisierung, 2005.
[55] Claudia von Werlhof, MAInopoly: Aus Spiel wird Ernst, in Mies/Werlhof,
2003, p. 148-192.
[56] Michel Chossudovsky, America's "War on Terrorism," Montreal, Global
Research, 2005.
[57] Michel Chossudovsky, Global Brutal. Der entfesselte Welthandel, die
Armut, der Krieg, Frankfurt, Zweitausendeins, 2002; Maria Mies, Krieg ohne Grenzen.
Die neue Kolonisierung der Welt, Köln, PapyRossa, 2005; Bennholdt-Thomsen/Faraclas/Werlhof
2001.
[58] Michel Chossudovsky, Global Brutal. Der entfesselte Welthandel, die
Armut, der Krieg, Frankfurt, Zweitausendeins, 2002.
[59] Wolfgang Richter, Elmar Schmähling, and Eckart Spoo (Hg), Die Wahrheit
über den NATO-Krieg gegen Jugoslawien, Schkeuditz, Schkeuditzer Buchverlag,
2000; Wolfgang Richter, Elmar Schmähling, and Eckart Spoo (Hg), Die deutsche
Verantwortung für den NATO-Krieg gegen Jugoslawien, Schkeuditz, Schkeuditzer
Buchverlag, 2000.
"... Monbiot is the best journalist the Guardian has, he can actually make a logical fact based argument unlike the majority of Guardian journalist. ..."
"... Monbiot suggests that a coherent alternative to the current situation needs to be developed but disappointingly fails to give any clues as to what it might look like except, of course, that it must have some type of environmental context. ..."
"... A coherent alternative has to be proposed. For Labour, the Democrats and the wider left, the central task should be to develop an economic Apollo programme, a conscious attempt to design a new system, tailored to the demands of the 21st century ..."
"... The trade union package, gave us meal breaks, holidays, sickness benefits, working hours restrictions, as opposed to the right wing media agenda ..."
"... Yes, a high priest of neo-liberalism, Lord Freud, was given only 13 weeks to investigate and reform key elements of the the UK's welfare system, it hasn't worked and Freud is now invisible. ..."
"... Failed neoliberalism and not restricting markets that do not benefit the majority are the cause and we stand on the brink of falling further should the Brexiter's have their way. If there's one thing the EU excels at it's legislating against the excesses of business and extremism. ..."
John Harris is wonderful too. The only guy on the staff who can write about
the working class with clarity, respect and understanding. But Monbiot is
also the biscuit.
'The Invisible Hand' is not an ideology or dogma. It's just a metaphor to
describe those with problems grasping abstract concepts: when there are
a large number of buyers and suppliers for a good, the 'market finds a price'
which is effectively the sum of all the intelligence of the participants,
their suppliers, customers etc..
The Socialists, who have difficulty grasping this reality, want to 'fix'
the price, which abnegates the collective intelligence of the market participants,
and causes severe problems.
Capitalism is freedom, Socialism is someone's ideology.
'The Invisible Hand' is... a metaphor to describe those with problems
grasping abstract concepts: when there are a large number of buyers
and suppliers for a good, the 'market finds a price' which is effectively
the sum of all the intelligence of the participants
You clearly haven't read Wealth of Nations. The only mention of an invisible
hand is actually a warning against what we now call neoliberalism. Smith
said that the wealthy wouldn't seek to enrich themselves to the detriment
of their home communities, because of an innate home bias. Thus, as if by
an invisible hand, England would be spared the ravages of economic rationality.
Your understanding of the 'invisible hand' is a falsehood perpetuated
by neoliberal think tanks like the Adam Smith institute (no endorsement
or connection to the author, despite using his name).
'The Invisible Hand' is not dogma.
You definitely know a lot about dogma (and false dichotomies):
Capitalism is freedom, Socialism is someone's ideology.
This is an interesting academic piece but the reality is that we don't have
anything like neo-liberalism in this country as defined by Hayek and it
has become a term of abuse by people who really ought to know better. The
strongest abuse of course is linked to the Blair Government, a period, of
course, when, with substantial success, the size and reach of the state
increased quite substantially, ie the complete opposite of neo-liberalism.
In fact, suggesting that the UK is neo liberal is not that much different
for suggesting that Russia had communism as defined by Marx.
Whether it is a good or bad thing that we don't have neo-liberalism is
open to academic debate but is not of much use in real life.
Monbiot suggests that a coherent alternative to the current situation
needs to be developed but disappointingly fails to give any clues as to
what it might look like except, of course, that it must have some type of
environmental context.
A coherent alternative has to be proposed. For Labour, the Democrats
and the wider left, the central task should be to develop an economic
Apollo programme, a conscious attempt to design a new system, tailored
to the demands of the 21st century
All very well, but how? Did anyone hear the screams of rage when Sanders
started threatening Hillary, or when Corbyn trounced the Blairites? The
dead hand of Bernays and Goebbels controls everything.
The failure to describe reality in a way that concurs with what ordinary
people experience has driven off much support and reduced credibility.
There is no credible model for investment and wealth creation.
The focus on social mobility upwards rather than on those who do not
move has given UK leftism a middle-class snobby air to it.
Those entering leftist politics have a very narrow range of life experience.
The opposition to rightist politics is cliched and outmoded.
There is a complete failure to challenge the emerging multi-polar plutocratic
oligarchy which runs the planet - the European left just seeks a comfy accommodation.
There is no attempt to develop a post-socialist, holistic worldview and
ideology.
The trade union package, gave us meal breaks, holidays, sickness benefits,
working hours restrictions, as opposed to the right wing media agenda,
that if you aint getting it nobody should, pour poison on the unions, pour
poison on the public sector, a fucking media led race to the bottom for
workers, and there were enough gullible (poor )mugs around to accept it.
You can curse the middle class socialists all you like, but without their
support the labour movement would never have got off the ground.
Okay, so you've described the 1950's through to the 1980's. So what have
the unions done for us isn the last two decades ? Why is it all the successful,
profitable and productive industries in the Uk have little or no union involvement
?
Why is it that the least effective, highest costs and poorest performing
structures are in the public sector and held back by the unions ?
Here's a clue - the unions are operating in the 21st century with a 1950's
mentality.
During the industrial revolution, profitability and productivity were off
the scale because the workforce were just commodities, Unionisation instigated
the idea that without the workforce, your entrepreneurs can't do anything
on their own, Henry Ford wouldn't have become a millionaire without the
help of his workforce. 'Poorest performing structures' Guess what! some
of us are human beings not auto- matrons. I hope you dine well on sterling
and dollars, cause they're not the most important things in life.
It's the only way. It's not perfect but it achieves the best ( not ideal
) possible result. What if in the end there's no where left to go ? What
if the highest possible taxes, zero avoidance / evasion and high employment
still equals deficits and increasing national debt ?
What if the highest possible taxes, zero avoidance / evasion and
high employment still equals deficits and increasing national debt ?
The paragraph written above neatly describes the post WW2 years, where
the UK was pretty much in perpetual surplus. High employment does not equate
to national debt/deficit. Quite the opposite, the more people in gainful
employment the better. Increasing unemployment, driving wages down while
simultaneously increasing the cost of living is a recipe for complete economic
failure.
This whole economics gig is piss easy, when the general mass of people
have cash to spare they spend it, economy thrives. Hoard the cash into the
hands of a minority and starve the masses of cash, economy dies. It really
is that simple.
Public deficits exist to match the private surplus created by the rich enriching
themselves. To get rid of the deficit therefore we need to get rid of the
private wealth of the rich through financial repression and taxation
I read, cannot remember where, that with neo liberalism the implementation
is all that matters, you do not need to see the results. I suppose because
the followers believe when implemented it will work perfectly.
I think it's supporters think it is magic and must work because they believe
it does.
Yes, a high priest of neo-liberalism, Lord Freud, was given only 13
weeks to investigate and reform key elements of the the UK's welfare system,
it hasn't worked and Freud is now invisible.
Hopeful this is the start for change through identifying issues and avoiding
pitfalls. Failed neoliberalism and not restricting markets that do not
benefit the majority are the cause and we stand on the brink of falling
further should the Brexiter's have their way. If there's one thing the EU
excels at it's legislating against the excesses of business and extremism.
Let's make a start by staying in the EU.
"... But if the alternative is to try and elect leaders from the centre who will do nothing to confront these great issues, and will instead cut spending, accept stagnation and wait for the next financial crisis, is it any wonder that many people would rather take their chance with someone different? ... ..."
"... Rather than celebrating the enthusiasm and interest of the many young people that have recently joined (even if they regard some of their aspirations as naive), and who will be vital in future election campaigns, this overtly anti-Corbyn group seem to regard them as a threat. ... ..."
We have not met, but I have talked to your former colleague Gordon a few times and I did some
academic work on his 5 tests for Euro entry. I saw a
report that you were mystified by the popularity of Jeremy Corbyn and Bernie Sanders. I have
an
article today in The Independent that might help you understand your puzzle.
I know you find it strange that people that appear to you like those your predecessor Neil
Kinnock did battle with over the future of the Labour Party in the 1980s are now running the party.
It must also seem strange that in the US where socialism once seemed to be regarded as a perversion,
large numbers should be supporting a socialist candidate. You suggest some explanations, but you
do not mention the power of finance, inequality and the senselessness of austerity. You say that
these new leaders will not be electable. But if the alternative is to try and elect leaders
from the centre who will do nothing to confront these great issues, and will instead cut spending,
accept stagnation and wait for the next financial crisis, is it any wonder that many people would
rather take their chance with someone different? ...
There are many Labour MPs and left leaning journalists who seem to share your puzzlement, and
have decided that they have to fight again the battles of the 1980s by doing everything to undermine
their new Labour leadership. ...
Rather than celebrating the enthusiasm and interest of the many
young people that have recently joined (even if they regard some of their aspirations as naive),
and who will be vital in future election campaigns, this overtly anti-Corbyn group seem to regard
them as a threat. ...
Please tell them to stop. I fear they need someone they respect like you to point out the foolishness
of their actions.
"... A political society endures when it seeks, as a vocation, to satisfy common needs by stimulating the growth of all its members, especially those in situations of greater vulnerability or risk. ..."
"... All of us are quite aware of, and deeply worried by, the disturbing social and political situation of the world today. Our world is increasingly a place of violent conflict, hatred and brutal atrocities, committed even in the name of God and of religion. ..."
"... We are asked to summon the courage and the intelligence to resolve today's many geopolitical and economic crises. Even in the developed world, the effects of unjust structures and actions are all too apparent. ..."
"... If politics must truly be at the service of the human person, it follows that it cannot be a slave to the economy and finance. ..."
"... At the risk of oversimplifying, we might say that we live in a culture which pressures young people not to start a family, because they lack possibilities for the future. Yet this same culture presents others with so many options that they too are dissuaded from starting a family ..."
Each son or daughter of a given country has a mission, a personal and social responsibility. Your
own responsibility as members of Congress is to enable this country, by your legislative activity,
to grow as a nation. You are the face of its people, their representatives. You are called to defend
and preserve the dignity of your fellow citizens in the tireless and demanding pursuit of the common
good, for this is the chief aim of all politics. A political society endures when it seeks, as
a vocation, to satisfy common needs by stimulating the growth of all its members, especially those
in situations of greater vulnerability or risk. Legislative activity is always based on care
for the people. To this you have been invited, called and convened by those who elected you.
... ... ...
All of us are quite aware of, and deeply worried by, the disturbing social and political situation
of the world today. Our world is increasingly a place of violent conflict, hatred and brutal atrocities,
committed even in the name of God and of religion. We know that no religion is immune from forms
of individual delusion or ideological extremism. This means that we must be especially attentive
to every type of fundamentalism, whether religious or of any other kind. A delicate balance is required
to combat violence perpetrated in the name of a religion, an ideology or an economic system, while
also safeguarding religious freedom, intellectual freedom and individual freedoms. But there is another
temptation which we must especially guard against: the simplistic reductionism which sees only good
or evil; or, if you will, the righteous and sinners. The contemporary world, with its open wounds
which affect so many of our brothers and sisters, demands that we confront every form of polarization
which would divide it into these two camps. We know that in the attempt to be freed of the enemy
without, we can be tempted to feed the enemy within. To imitate the hatred and violence of tyrants
and murderers is the best way to take their place. That is something which you, as a people, reject.
...We are asked to summon the courage and the intelligence to resolve today's many geopolitical
and economic crises. Even in the developed world, the effects of unjust structures and actions are
all too apparent. Our efforts must aim at restoring hope, righting wrongs, maintaining commitments
and thus promoting the well-being of individuals and of peoples. We must move forward together, as
one, in a renewed spirit of fraternity and solidarity, cooperating generously for the common good.
The challenges facing us today call for a renewal of that spirit of cooperation, which has accomplished
so much good throughout the history of the United States. The complexity, the gravity and the urgency
of these challenges demand that we pool our resources and talents, and resolve to support one another,
with respect for our differences and our convictions of conscience.
In this land, the various religious denominations have greatly contributed to building and strengthening
society. It is important that today, as in the past, the voice of faith continue to be heard, for
it is a voice of fraternity and love, which tries to bring out the best in each person and in each
society. Such cooperation is a powerful resource in the battle to eliminate new global forms of slavery,
born of grave injustices which can be overcome only through new policies and new forms of social
consensus.
...If politics must truly be at the service of the human person, it follows that it cannot
be a slave to the economy and finance. Politics is, instead, an expression of our compelling
need to live as one, in order to build as one the greatest common good: that of a community which
sacrifices particular interests in order to share, in justice and peace, its goods, its interests,
its social life. I do not underestimate the difficulty that this involves, but I encourage you in
this effort.
... ... ...
The fight against poverty and hunger must be fought constantly and on many fronts, especially
in its causes. I know that many Americans today, as in the past, are working to deal with this problem.
It goes without saying that part of this great effort is the creation and distribution of wealth.
The right use of natural resources, the proper application of technology and the harnessing of the
spirit of enterprise are essential elements of an economy which seeks to be modern, inclusive and
sustainable. "Business is a noble vocation, directed to producing wealth and improving the world.
It can be a fruitful source of prosperity for the area in which it operates, especially if it sees
the creation of jobs as an essential part of its service to the common good" (Laudato Si', 129).
This common good also includes the earth, a central theme of the encyclical which I recently wrote
in order to "enter into dialogue with all people about our common home" (ibid., 3). "We need a conversation
which includes everyone, since the environmental challenge we are undergoing, and its human roots,
concern and affect us all" (ibid., 14).
In Laudato Si', I call for a courageous and responsible effort to "redirect our steps" (ibid.,
61), and to avert the most serious effects of the environmental deterioration caused by human activity.
I am convinced that we can make a difference and I have no doubt that the United States – and this
Congress – have an important role to play. Now is the time for courageous actions and strategies,
aimed at implementing a "culture of care" (ibid., 231) and "an integrated approach to combating poverty,
restoring dignity to the excluded, and at the same time protecting nature" (ibid., 139). "We have
the freedom needed to limit and direct technology" (ibid., 112); "to devise intelligent ways of .
. . developing and limiting our power" (ibid., 78); and to put technology "at the service of another
type of progress, one which is healthier, more human, more social, more integral" (ibid., 112). In
this regard, I am confident that America's outstanding academic and research institutions can make
a vital contribution in the years ahead.
... ... ...
...At the risk of oversimplifying, we might say that we live in a culture which pressures
young people not to start a family, because they lack possibilities for the future. Yet this same
culture presents others with so many options that they too are dissuaded from starting a family.
"... 1.TiSA would "lock in" the privatization of services – even in cases where private service delivery has failed – meaning governments can never return water, energy, health, education or other services to public hands. ..."
"... 2.TiSA would restrict signatory governments' right to regulate stronger standards in the public's interest. For example, it will affect environmental regulations, licensing of health facilities and laboratories, waste disposal centres, power plants, school and university accreditation and broadcast licenses. ..."
"... 3.TiSA would limit the ability of governments to regulate the financial services industry, at a time when the global economy is still struggling to recover from a crisis caused primarily by financial deregulation. More specifically, if signed the trade agreement would: ..."
"... 4. TiSA would ban any restrictions on cross-border information flows and localization requirements for ICT service providers. A provision proposed by US negotiators would rule out any conditions for the transfer of personal data to third countries that are currently in place in EU data protection law. In other words, multinational corporations will have carte blanche to pry into just about every facet of the working and personal lives of the inhabitants of roughly a quarter of the world's 200-or-so nations. ..."
"... 5. Finally, TiSA, together with its sister treaties TPP and TTIP, would establish a new global enclosure system, one that seeks to impose on all 52 signatory governments a rigid framework of international corporate law designed to exclusively protect the interests of corporations, relieving them of financial risk and social and environmental responsibility. In short, it would hammer the final nail in the already bedraggled coffin of national sovereignty. ..."
"... So, not to be snarky or anything but when does the invasion of Uruguay begin. ..."
"... In the US, corporations largely have replaced government since WWII or so, or at least pretend to offer the services that a government might provide. ..."
"... Neoliberalism that we have now as a dominant social system is a flavor of corporatism. If so, it is corporations which now represent the most politically powerful actors. They literally rule the country. And it is they who select the president, most congressmen and Senators. Try to ask yourself a question: to what political force Barak "change we can believe in" Obama serves. ..."
"... "And the banks - hard to believe in a time when we're facing a banking crisis that many of the banks created - are still the most powerful lobby on Capitol Hill. And they frankly own the place" ..."
"... This is such a huge, huge, vital issue. Privatisation of public assets has to rank as one of the highest crimes at the government level. It is treason, perhaps the only crime for which i wouldn't object capital punishment. ..."
"... What's more, we now have some 40 years of data showing that privatisation doesn't work. surely, we can organise and successfully argue that privatisation has never worked for any country any time. There needs to be an intellectual assault on privatisation discrediting it forever. ..."
Often referred to as the Switzerland of South America, Uruguay is long accustomed to doing things
its own way. It was the first nation in Latin America to establish a welfare state. It also has an
unusually large middle class for the region and unlike its giant neighbors to the north and west,
Brazil and Argentina, is largely free of serious income inequality.
Two years ago, during José Mujica's presidency, Uruguay became the first nation to legalize marijuana
in Latin America, a continent that is being ripped apart by drug trafficking and its associated violence
and corruption of state institutions.
Now Uruguay has done something that no other semi-aligned nation on this planet has dared to do:
it has rejected the advances of the global corporatocracy.
The Treaty That Must Not Be Named
Earlier this month Uruguay's government decided to end its participation in the secret negotiations
of the Trade in Services Agreement (TISA). After months of intense pressure led by unions and other
grassroots movements that culminated in a national general strike on the issue – the first of its
kind around the globe – the Uruguayan President Tabare Vazquez bowed to public opinion and left the
US-led trade agreement.
Despite – or more likely because of – its symbolic importance, Uruguay's historic decision has
been met by a wall of silence. Beyond the country's borders, mainstream media has refused to cover
the story.
This is hardly a surprise given that the global public is not supposed to even know about TiSA's
existence, despite – or again because of – the fact that it's arguably the most important of the
new generation of global trade agreements. According to WikiLeaks, it "is the largest component of
the United States' strategic 'trade' treaty triumvirate," which also includes the Trans Pacific Partnership
(TPP) and the TransAtlantic Trade and Investment Pact (TTIP).
TiSA involves more countries than TTIP and TPP combined: The United States and all 28 members
of the European Union, Australia, Canada, Chile, Colombia, Costa Rica, Hong Kong, Iceland, Israel,
Japan, Liechtenstein, Mexico, New Zealand, Norway, Pakistan, Panama, Paraguay, Peru, South Korea,
Switzerland, Taiwan and Turkey.
Together, these 52 nations form the charmingly named "Really Good Friends of Services" group,
which represents almost 70% of all trade in services worldwide. Until its government's recent u-turn
Uruguay was supposed to be the 53rd Good Friend of Services.
TiSA Trailer
TiSA has spent the last two years taking shape behind the hermetically sealed doors of highly
secure locations around the world. According to the agreement's provisional text, the document is
supposed to remain confidential and concealed from public view for at least five years after being
signed. Even the World Trade Organization has been sidelined from negotiations.
But thanks to whistle blowing sites like WikiLeaks, the Associated Whistleblowing Press and Filtrala,
crucial details have seeped to the surface. Here's a brief outline of what is known to date (for
more specifics click
here,
here and
here):
1.TiSA would "lock in" the privatization of services – even in cases where private service
delivery has failed – meaning governments can never return water, energy, health, education or other
services to public hands.
2.TiSA would restrict signatory governments' right to regulate stronger standards in the public's
interest. For example, it will affect environmental regulations, licensing of health facilities and
laboratories, waste disposal centres, power plants, school and university accreditation and broadcast
licenses.
3.TiSA would limit the ability of governments to regulate the financial services industry,
at a time when the global economy is still struggling to recover from a crisis caused primarily by
financial deregulation. More specifically, if signed the trade agreement would:
Restrict the ability of governments to place limits on the trading of derivative contracts
- the largely unregulated weapons of mass financial destruction that helped trigger the 2007-08
Global Financial Crisis.
Bar new financial regulations that do not conform to deregulatory rules. Signatory governments
will essentially agree not to apply new financial policy measures which in any way contradict
the agreement's emphasis on deregulatory measures.
Prohibit national governments from using capital controls to prevent or mitigate financial
crises. The leaked texts prohibit restrictions on financial inflows – used to prevent rapid currency
appreciation, asset bubbles and other macroeconomic problems – and financial outflows, used to
prevent sudden capital flight in times of crisis.
Require acceptance of financial products not yet invented. Despite the pivotal role that new,
complex financial products played in the Financial Crisis, TISA would require governments to allow
all new financial products and services, including ones not yet invented, to be sold within their
territories.
4. TiSA would ban any restrictions on cross-border information flows and localization requirements
for ICT service providers. A provision proposed by US negotiators would rule out any conditions for
the transfer of personal data to third countries that are currently in place in EU data protection
law. In other words, multinational corporations will have carte blanche to pry into just about every
facet of the working and personal lives of the inhabitants of roughly a quarter of the world's 200-or-so
nations.
As I wrote in
LEAKED: Secret Negotiations to Let Big Brother Go Global, if TiSA is signed in its current form
– and we will not know exactly what that form is until at least five years down the line – our personal
data will be freely bought and sold on the open market place without our knowledge; companies and
governments will be able to store it for as long as they desire and use it for just about any purpose.
5. Finally, TiSA, together with its sister treaties TPP and TTIP, would establish a new global
enclosure system, one that seeks to impose on all 52 signatory governments a rigid framework of international
corporate law designed to exclusively protect the interests of corporations, relieving them of financial
risk and social and environmental responsibility. In short, it would hammer the final nail in the
already bedraggled coffin of national sovereignty.
A Dangerous Precedent
Given its small size (population: 3.4 million) and limited geopolitical or geo-economic clout,
Uruguay's withdrawal from TiSA is unlikely to upset the treaty's advancement. The governments of
the major trading nations will continue their talks behind closed doors and away from the prying
eyes of the people they are supposed to represent. The U.S. Congress has already agreed to grant
the Obama administration fast-track approval on trade agreements like TiSA while the European Commission
can be expected to do whatever the corporatocracy demands.
However, as the technology writer Glyn Moody
notes, Uruguay's defection – like the people of Iceland's refusal to assume all the debts of
its rogue banks – possesses a tremendous symbolic importance:
It says that, yes, it is possible to withdraw from global negotiations, and that the apparently
irreversible trade deal ratchet can actually be turned back. It sets an important precedent that
other nations with growing doubts about TISA – or perhaps TPP – can look to and maybe even follow.
Naturally, the representatives of Uruguay's largest corporations would agree to disagree. The
government's move was one of its biggest mistakes of recent years,
according to Gabriel Oddone, an analyst with the financial consultancy firm CPA Ferrere. It was
based on a "superficial discussion of the treaty's implications."
What Oddone conveniently fails to mention is that Uruguay is the only nation on the planet that
has had any kind of public discussion, superficial or not, about TiSA and its potentially game-changing
implications. Perhaps it's time that changed.
So, not to be snarky or anything but when does the invasion of Uruguay begin. Wondering:
don't they want to pay $750.00 per pill for what cost $13.85 the day before? Aren't they interested
in predatory capitalism? What is going on down there?
Jim Haygood, September 23, 2015 at 12:17 pm
Most symbolic is that the eighth round of multilateral trade negotiations under GATT (now WTO)
kicked off in Punta del Este, Uruguay in Sep. 1986.
It went into effect in 1995, and is still known as the Uruguay Round.
susan the other, September 23, 2015 at 1:21 pm
And will international corporations issue their own fiat; pass their own laws; and prosecute
their own genocide? Contrary to their group hallucinations, corporations cannot replace government.
And clearly, somebody forgot to tell them that capitalism, corporatism, cannot survive without
growth. The only growth they will achieve is raiding other corporations. They are more powerless
and vulnerable than they ever want to admit.
hunkerdown, September 23, 2015 at 8:13 pm
And will international corporations issue their own fiat; pass their own laws; and
prosecute their own genocide?
Sure. There's prior art. Company scrip, substance "abuse" policies, and Bhopal (for a bit
different definition of "prosecute").
In the US, corporations largely have replaced government since WWII or so, or at least
pretend to offer the services that a government might provide.
likbez, September 24, 2015 at 10:54 pm
They are more powerless and vulnerable than they ever want to admit.
You are dreaming. Neoliberalism that we have now as a dominant social system is a flavor
of corporatism. If so, it is corporations which now represent the most politically powerful
actors. They literally rule the country. And it is they who select the president, most congressmen
and Senators. Try to ask yourself a question: to what political force Barak "change we can
believe in" Obama serves.
As Sen. Dick Durbin (D-Ill.) aptly noted:
"And the banks - hard to believe in a time when we're facing a banking crisis that
many of the banks created - are still the most powerful lobby on Capitol Hill. And they
frankly own the place"
gordon, September 23, 2015 at 9:03 pm
The TISA has a history. It's really just a continuation of the MAI treaty which the OECD failed
to conclude back in the 1990s.
What I don't get is why all those countries want to sign up to these agreements. I can see
what is in it for the US elites, but how does it help these smaller countries?
likbez, September 24, 2015 at 10:43 pm
Elites of those small countries are now transnational. So in a way they represent the fifth
column of globalization. That explains their position: own profit stands before interests of
the country.
vidimi, September 24, 2015 at 4:19 am
This is such a huge, huge, vital issue. Privatisation of public assets has to rank as one
of the highest crimes at the government level. It is treason, perhaps the only crime for which
i wouldn't object capital punishment.
What's more, we now have some 40 years of data showing that privatisation doesn't work.
surely, we can organise and successfully argue that privatisation has never worked for any country
any time. There needs to be an intellectual assault on privatisation discrediting it forever.
The analogy with Trotskyism, which is also a secular religion here are so evident, that they can't
be missed. And that explains why it is so tenacious: all cults are extremely tenacious and very difficult
to eradiate.
Notable quotes:
"... As the neoliberal revolution instigated by Reagan and Thatcher in the 1980 has spread, however,
Polanyi has been rediscovered. His great book – now republished with a foreword by Joseph Stiglitz –
has attracted a new generation of readers. ..."
"... The cult of free market fundamentalism has become so normative in our times, and economics
as a discipline so hidebound and insular, that reading Polanyi today is akin to walking into a stiff
gust of fresh air. We can suddenly see clear, sweeping vistas of social reality. Instead of the mandarin,
quantitative and faux-scientific presumptions of standard economics – an orthodoxy of complex illusions
about "autonomous" markets – Polanyi explains how markets are in fact embedded in a complex web of social,
cultural and historical realities. ..."
"... Markets can only work, for example, if political and legal institutions contrive to transform
people, land and money into assets that can be bought and sold. Polanyi calls these "fictional commodities"
because people, land and money are not in fact commodities. People and land have their own existence
and purposes apart from the market – and money is a social institution, even if many pretend that gold
is a self-evident medium of value. ..."
"... Block and Somers point to a closed and coherent ideational scheme that knits together several
key belief systems. The first is the idea that the laws of nature govern human society, and thus the
workings of the economy are seen as a biological and evolutionary inevitability. A second theme is the
idea of "theoretical realism," a belief that the theoretical schema is more true and enduring than any
single piece of empirical evidence, and thus one can argue from the claims of theory and not from facts.
..."
"... Finally, a "conversion narrative" enables free marketeers tell to neutralize and delegitimate
any contrary arguments, and enabling them to introduce its alternative story. This approach is routinely
used to re-cast the reasons (and blame) for poverty. ..."
"... What makes The Power of Market Fundamentalism so illuminating is its patient, careful reconstruction
of these recurring and deceptive polemical patterns. The wealthy invoke the same rhetorical strategies
again and again over the course of hundreds of years in extremely different contexts. With their mastery
of an enormous contemporary literature, Block and Somers document the remarkable parallels and show
just how deep and durable Polanyi's analysis truly is ..."
One of the great economists of the twentieth century had the misfortune of publishing his magnum
opus, The Great Transformation, in 1944, months before the inauguration of a new era
of postwar economic growth and consumer culture. Few people in the 1940s or 1950s wanted to hear
piercing criticisms of "free markets," let alone consider the devastating impacts that markets tend
to have on social solidarity and the foundational institutions of civil society. And so for decades
Polanyi remained something of a curiosity, not least because he was an unconventional academic with
a keen interest in the historical and anthropological dimensions of economics.
As the neoliberal revolution instigated by Reagan and Thatcher in the 1980 has spread, however,
Polanyi has been rediscovered. His great book – now republished with a foreword by Joseph Stiglitz
– has attracted a new generation of readers.
But how to make sense of Polanyi's work with all that has happened in the past 70 years? Why does
he still speak so eloquently to our contemporary problems? For answers, we can be grateful that we
have The Power
of Market Fundamentalism: Karl Polanyi's Critique, written by Fred Block and Margaret R. Somers,
and published last year. The book is a first-rate reinterpretation of Polanyi's work, giving it a
rich context and commentary. Polanyi focused on the deep fallacies of economistic thinking and its
failures to understand society and people as they really are. What could be more timely?
The cult of free market fundamentalism has become so normative in our times, and economics
as a discipline so hidebound and insular, that reading Polanyi today is akin to walking into a stiff
gust of fresh air. We can suddenly see clear, sweeping vistas of social reality. Instead of the mandarin,
quantitative and faux-scientific presumptions of standard economics – an orthodoxy of complex illusions
about "autonomous" markets – Polanyi explains how markets are in fact embedded in a complex web of
social, cultural and historical realities.
Markets can only work, for example, if political and legal institutions contrive to transform
people, land and money into assets that can be bought and sold. Polanyi calls these "fictional commodities"
because people, land and money are not in fact commodities. People and land have their own existence
and purposes apart from the market – and money is a social institution, even if many pretend that
gold is a self-evident medium of value.
Notwithstanding these realities, capitalist societies ahve created these fictional commodities.
People have in effect been transformed into units of "labor" that can be bought and sold in the market,
and discarded when their value is depleted. Land, too, is treated as a market asset that has no connection
to a larger, living ecosystem or human community. Inevitably, people and users of land (and ecosystems
themselves) rebel against their treatment as raw commodities. The result is a permanent counter-movement
against those who insist upon treating people and land as commodities.
Unlike Keynes, who was willing to accept some of these economic illusions in order to have political
impact, Polanyi rejected them as a recipe for a dangerous and unachievable utopianism. That is in
fact what has emerged over the past several generations as business ideologues have advanced quasi-religious
visions of free market fundamentalism. The planet's natural systems and our communities simply cannot
fulfill these utopian dreams of endless economic growth, vast consumption of resources and the massive
social engineering. And yet it continues.
Polanyi was courageous enough to strip away the pretenses that the economy is a "force of nature"
that cannot be stopped. The economy, he said, is an "instituted process," not a natural one, and
it can only survive through massive governmental interventions and cultural regimentation. The free
market system is hardly autonomous and self-executing. It requires enormous amounts of government
purchasing, research subsidies, legal privileges, regulatory agencies to enhance fairness and public
trust, military interventions to secure access to resources and markets, and the sabotage of democratic
processes that might threaten investments and market growth. The 2008 financial crisis revealed in
outrageous detail how financial markets are anything but autonomous.
So what accounts for the insidious power of market fundamentalism and its illusions? Why do its
premises remain intact and influential in the face of so much contrary evidence?
Block and Somers point to a closed and coherent ideational scheme that knits together several
key belief systems. The first is the idea that the laws of nature govern human society, and thus
the workings of the economy are seen as a biological and evolutionary inevitability. A second theme
is the idea of "theoretical realism," a belief that the theoretical schema is more true and enduring
than any single piece of empirical evidence, and thus one can argue from the claims of theory and
not from facts. Free market narratives assert their own self-validating claims to what is true;
epistemological categories trump all empirical challenges.
Finally, a "conversion narrative" enables free marketeers tell to neutralize and delegitimate
any contrary arguments, and enabling them to introduce its alternative story. This approach is routinely
used to re-cast the reasons (and blame) for poverty. Instead of acknowledging institutional
or structural explanations for why many people are poor, the free market narrative boldly attacks
government for making people poor through aid programs. Government programs supposedly have
a perverse effect, aggravating, not aleviating poverty. The poor are cast as morally responsible
– along with government – for their own sorry circumstances. Thus, a higher minimum wage is perverse,
say free market champions, because it will hurt the poor rather than help them.
What makes The Power of Market Fundamentalism so illuminating is its patient, careful reconstruction
of these recurring and deceptive polemical patterns. The wealthy invoke the same rhetorical strategies
again and again over the course of hundreds of years in extremely different contexts. With their
mastery of an enormous contemporary literature, Block and Somers document the remarkable parallels
and show just how deep and durable Polanyi's analysis truly is .
"... Note the adjective " unfettered ". Anything that is not sanctioned by the rule of law is not good for anyone. The challenge today is extractive capitalism. Some of this can be addressed by tax policy. Bankruptcy law needs to be changed to hold liable those executives who take out excessive amounts of funds from an enterprize. Personal property needs need better protection. Existing environmental laws need to be enforced. ..."
"... My understanding is that Pope Francis (I am not Catholic) has spoken about the inherent unfairness of "unrestricted" capitalism. He has not denounced capitalism. His words are painstaking, accurately stated & precise. ..."
"... I like his moves, promoting climate change, making a point in visiting the poorest countries on Earth, and naming Capitalists as members of a greedy system, not capable of taking on the role of providing goods and services to the Needy, and of course, the Pontiff heaps religious obscenities upon the War Mongers, mainly in the West. I am going to give my Bible another chance, here's hoping . ..."
"... He seems to be pointing out a few realities. Which, as others have pointed out is causing much wriggling by those who have complete faith by the dollar in the sky. ..."
"... "The US government gives the Vatican nothing...". Not quite. The US Government gives the Church tax-exemption. ..."
"... Of course all the corporate politicians both Republican and Democrat are going to oppose the Pope. Forget the politicians and let's see how the American people react. I expect the Pope will be warmly received as a man of empathy and humanity who shows concern for the poor. I hope that when he addresses congress he does not pull any of his punches. ..."
I do not mean to misquote him. Pope Francis is a good man, but before he lectures the US on
capitalism, he needs to remember that the Vatican bank has been embroiled in their own banking
scandals. I was raised Catholic. I do not have a good impression of the men who run the church.
They spend a lot of time asking for money, and I always wonder if they are spending it hiring
lawyers for pedophile priests. I like the Pope though. He seems better that the rest of the lot.
I think the tax exemptions for religions should be stopped. Religions spend too much time discriminating
against certain segments of society. I think they are wolves in sheep's clothing.
RoachAmerican 13 Jul 2015 20:19
Note the adjective " unfettered ". Anything that is not sanctioned by the rule of law is
not good for anyone. The challenge today is extractive capitalism. Some of this can be addressed
by tax policy. Bankruptcy law needs to be changed to hold liable those executives who take out
excessive amounts of funds from an enterprize. Personal property needs need better protection.
Existing environmental laws need to be enforced.
William Brown 13 Jul 2015 20:05
I imagine The Pope will say something about an 'eye of a needle'
brianboru1014 13 Jul 2015 19:52
Wall Street via the New York Times and the WS Journal is well on the way to denigrating this
man. Even though most Americans support him, these publications will do everything to belittle
him.
The US government gives "only" tax exempt status. On the other-hand, citizens of the US very
likely raise more money for the Catholic Church than the citizens of any other country.
Ken Barnes -> LivinVirginia 13 Jul 2015 19:30
My understanding is that Pope Francis (I am not Catholic) has spoken about the inherent
unfairness of "unrestricted" capitalism. He has not denounced capitalism. His words are painstaking,
accurately stated & precise. It helps no one in a discussion to change what another has said
& then attempt to debate the misquote.
Greenshoots -> goatrider 13 Jul 2015 19:29
And a shedload of other "purposes" as well:
The exempt purposes set forth in section 501(c)(3) are charitable, religious, educational,
scientific, literary, testing for public safety, fostering national or international amateur sports
competition, and preventing cruelty to children or animals. The term charitable is used in its
generally accepted legal sense and includes relief of the poor, the distressed, or the underprivileged;
advancement of religion; advancement of education or science; erecting or maintaining public buildings,
monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating
prejudice and discrimination; defending human and civil rights secured by law; and combating community
deterioration and juvenile delinquency.
Richard Martin 13 Jul 2015 19:20
Francis really follows in the footsteps of the First Fisherman, radicalised in God's format
.
I like his moves, promoting climate change, making a point in visiting the poorest countries
on Earth, and naming Capitalists as members of a greedy system, not capable of taking on the role
of providing goods and services to the Needy, and of course, the Pontiff heaps religious obscenities
upon the War Mongers, mainly in the West. I am going to give my Bible another chance, here's hoping
.
John Fahy 13 Jul 2015 19:16
He seems to be pointing out a few realities. Which, as others have pointed out is causing
much wriggling by those who have complete faith by the dollar in the sky.
goatrider -> LivinVirginia 13 Jul 2015 19:01
As it does every other religion----
TerryMcGee -> Magali Luna 13 Jul 2015 19:00
Up until this pope, I would have agreed with you. But this pope is different. In one step,
he has taken the papacy from being a major part of the problem to a major force for good. We can't
expect him to fix all the problems in the church and its doctrines - that's not the work of one
generation. But if he can play a major part in fixing the two massive world problems he has focussed
on - climate change and rampant capitalism - he will have done enough for one lifetime.
And I get the impression that he's only warming up....
LivinVirginia -> goatrider 13 Jul 2015 18:34
"The US government gives the Vatican nothing...". Not quite. The US Government gives the Church tax-exemption.
David Dougherty 13 Jul 2015 18:13
Of course all the corporate politicians both Republican and Democrat are going to oppose
the Pope. Forget the politicians and let's see how the American people react. I expect the Pope
will be warmly received as a man of empathy and humanity who shows concern for the poor. I hope
that when he addresses congress he does not pull any of his punches.
Cooper2345 13 Jul 2015 17:59
I like the gift that Morales gave to the Pope, the crucifix over the hammer and sickle. It
shows the victory of Christianity over Soviet communism that one of Francis' predecessors helped
to shepherd. It's a great reminder of a wonderful triumph and reason to be thankful for the genius
of St. John Paul II.
"... By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Jointly published with http://neweconomicperspectives.org " rel="nofollow">New Economic Perspectives ..."
"... New York Times ..."
"... New York Times ..."
"... laissez faire. ..."
"... The Gospel According to St. Lloyd Blankfein ..."
By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate
professor of economics and law at the University of Missouri-Kansas City. Jointly published with
http://neweconomicperspectives.org" rel="nofollow">New Economic Perspectives
A New York Times
article entitled "Championing Environment, Francis Takes Aim at Global Capitalism" quotes a conventional
Harvard economist, Robert N. Stavins. Stavins is enraged by Pope Francis' position on the environment
because the Pope is "opposed to the world economic order." The rage, unintentionally, reveals why
conventional economics is the most dangerous ideology pretending to be a "science."
Stavins' attacks on the Pope quickly became personal and dismissive. This is odd, for Pope Francis'
positions on the environment are the same as Stavins' most important positions. Stavins' natural
response to the Pope's views on the environment – had Stavin not been an economist – would have been
along the lines of "Pope Francis is right, and we urgently need to make his vision a reality."
Stavins' fundamental position is that there is an urgent need for a "radical restructuring" of
the markets to prevent them from causing a global catastrophe. That is Pope Francis' fundamental
position. But Stavins ends up mocking and trying to discredit the Pope.
I was struck by the similarity of Stavins response to Pope Francis to the rich man's response
to Jesus. The episode is reported in Matthew, Mark, and Luke in similar terms. I'll use Matthew's
version (KJAV), which begins at 19:16 with the verse:
And, behold, one came and said unto him, Good Master, what good thing shall I do, that I may
have eternal life?
Jesus responds:
And he said unto him, Why callest thou me good? there is none good but one, that is, God: but
if thou wilt enter into life, keep the commandments.
The young rich man wants to know which commandments he needs to follow to gain eternal life.
He saith unto him, Which? Jesus said, Thou shalt do no murder, Thou shalt not commit adultery,
Thou shalt not steal, Thou shalt not bear false witness,
Honour thy father and thy mother: and, Thou shalt love thy neighbour as thyself.
The young man saith unto him, All these things have I kept from my youth up: what lack I yet?
The young, wealthy man is enthused. The Rabbi that he believes has the secret of eternal life
has agreed to personally answer his question as to how to obtain it. He passes the requirements the
Rabbi lists, indeed, he has met those requirements since he was a child.
But then Jesus lowers the boom in response to the young man's question on what he "lacks."
Jesus said unto him, If thou wilt be perfect, go and sell that thou hast, and give to the poor,
and thou shalt have treasure in heaven: and come and follow me.
We need to "review the bidding" at this juncture. The young man is wealthy. He believes that Jesus
knows the secret to obtaining eternal life. His quest was to discover – and comply – with the requirement
to achieve eternal life. The Rabbi has told him the secret – and then gone well beyond the young
man's greatest hopes by offering to make him a disciple. The door to eternal life is within the young
man's power to open. All he needs to do is give all that he owns to the poor. The Rabbi goes further
and offers to make the young man his disciple. In exchange, the young man will secure "treasure in
heaven" – eternal life and a place of particular honor for his sacrifice and his faith in Jesus.
Jesus' answer – the answer the young man thought he wished to receive more than anything in the
world – the secret of eternal life, causes the young man great distress.
But when the young man heard that saying, he went away sorrowful: for he had great possessions.
The young man rejects eternal life because he cannot bear the thought of giving his "great possessions"
to "the poor." Notice that the young man is not evil. He keeps the commandments. He is eager to do
a "good thing" to gain eternal life. He has "great possessions" and is eager to trade a generous
portion of his wealth as a good deed to achieve eternal life. In essence, he is seeking to purchase
an indulgence from Jesus.
But Jesus' response causes the young, wealthy man to realize that he must make a choice. He must
decide which he loves more – eternal life or his great possessions. He is "sorrowful" for Jesus'
response causes him to realize that he loves having his great possessions for his remaining span
of life on earth more than eternal life itself.
Jesus offers him not only the means to open the door to eternal life but the honor of joining
him as a disciple. The young man is forced by Jesus' offer to realize that his wealth has so fundamentally
changed him that he will voluntarily give up his entry into eternal life. He is not simply "sorrowful"
that he will not enter heaven – he is "sorrowful" to realize that heaven is open to him – but he
will refuse to enter it because of his greed. His wealth has become a golden trap of his own creation
that will damn him. The golden bars of his cell are invisible and he can remove them at any time
and enter heaven, but the young man realizes that his greed for his "great possessions" has become
so powerful that his self-created jail cell has become inescapable. It is only when Jesus opens the
door to heaven that the young man realizes for the first time in his life how completely his great
possessions have corrupted and doomed him. He knows he is committing the suicide of his soul – and
that he is powerless to change because he has been taught to value his own worth as a person by the
extent of his great possessions.
Jesus then makes his famous saying that captures the corrupting effects of great wealth.
Then said Jesus unto his disciples, Verily I say unto you, That a rich man shall hardly enter
into the kingdom of heaven.
And again I say unto you, It is easier for a camel to go through the eye of a needle, than
for a rich man to enter into the kingdom of God.
The remainder of the passage is of great importance to Luther's doctrine of "justification by
faith alone" and leads to Jesus' famous discussion of why "the last shall be first," (in which his
anti-market views are made even more explicit) but the portions I have quoted are adequate to my
purpose.
Pope Francis' positions on the environment and climate are the greatest boon that Stavin has received
in decades. The Pope, like Stavins, tells us that climate change is a disaster that requires urgent
governmental action to fix. Stavins could receive no more joyous news. Instead of being joyous, however,
Stavins is sorrowful. Indeed, unlike the wealthy man who simply leaves after hearing the Rabbi's
views, Stavins rages at and heaps scorn on the prelate, Pope Francis. Stavins' email to the New
York Times about the Pope's position on climate change contains this double ideological smear.
The approach by the pope, an Argentine who is the first pontiff from the developing world,
is similar to that of a "small set of socialist Latin American countries that are opposed to the
world economic order, fearful of free markets, and have been utterly dismissive and uncooperative
in the international climate negotiations," Dr. Stavins said.
Stavins' work explicitly states that the "free markets" he worships are causing "mass extinction"
and a range of other disasters. Stavins' work explicitly states that the same "free markets" are
incapable of change – they cause incentives so perverse that they are literally suicidal – and the
markets are incapable of reform even when they are committing suicide by laissez faire.
That French term is what Stavins uses to describe our current markets. Pope Francis agrees with each
of these points.
Pope Francis says, as did Jesus, that this means that we must not worship "free markets," that
we must think first of the poor, and that justice and fairness should be our guides to proper conduct.
Stavins, like the wealthy young man, is forced to make a choice. He chooses "great possessions."
Unlike the wealthy young man, however, Stavins is enraged rather than "sorrowful" and Stavins lashes
out at the religious leader. He is appalled that an Argentine was made Pope, for Pope Francis holds
views "that are opposed to the world economic order [and] fearful of free markets." Well, yes. A
very large portion of the world's people oppose "the Washington Consensus" and want a very different
"world economic order." Most of the world's top religious leaders are strong critics of the "world
economic order."
As to being "fearful of free markets," Stavins' own work shows that his use of the word "free"
in that phrase is not simply meaningless, but false. Stavins explains that the people, animals, and
plants that are the imminent victims of "mass extinction" have no ability in the "markets" to protect
themselves from mass murder. They are "free" only to become extinct, which makes a mockery of the
word "free."
Similarly, Stavins' work shows that any sentient species would be "fearful" of markets that Stavins
proclaims are literally suicidal and incapable of self-reform. Stavins writes that only urgent government
intervention that forces a "radical restructuring" of the markets can save our planet from "mass
extinction." When I read that I believed that he was "fearful of free markets."
We have all had the experience of seeing the "free markets" blow up the global economy as recently
as 2008. We saw there, as well, that only massive government intervention could save the markets
from a global meltdown. Broad aspects of the financial markets became dominated by our three epidemics
of "accounting control fraud."
Stavins is appalled that a religious leader could oppose a system based on the pursuit and glorification
of "great possessions." He is appalled that a religious leader is living out the Church's mission
to provide a "preferential option for the poor." Stavins hates the Church's mission because it is
"socialist" – and therefore so obviously awful that it does not require refutation by Stavins. This
cavalier dismissal of religious beliefs held by most humans is revealing coming from a field that
proudly boasts the twin lies that it is a "positive" "science." Theoclassical economists embrace
an ideology that is antithetical to nearly every major religion.
Stavins, therefore, refuses to enter the door that Pope Francis has opened. Stavins worships a
system based on the desire to accumulate "great possessions" – even though he knows that the markets
pose an existential threat to most species on this planet and even though he knows that his dogmas
increasingly aid the worst, most fraudulent members of our society to become wealthy through forms
of "looting" (Akerlof and Romer 1993) that make other people poorer. The result is that Stavins denounces
Pope Francis rather than embracing him as his most valuable ally.
Conclusion: Greed and Markets Kill: Suicide by Laissez Faire
The old truths remain. The worship of "great possessions" wreaks such damage on our humanity that
we come to love them more than life itself and act in a suicidal fashion toward our species and as
mass destroyers of other species. Jesus' insight was that this self-corruption is so common, so subtle,
and so powerful that "It is easier for a camel to go through the eye of a needle, than for a rich
man to enter into the kingdom of God." Today, he would probably use "economist" rather than "camel."
Theoclassical economists are the high priests of this celebration of greed that Stavins admits
poses the greatest threat to life on our planet. When Pope Francis posed a choice to Stavins, he
chose to maintain his dogmatic belief in a system that he admits is suicidal and incapable of self-reform.
The reason that the mythical and mystical "free markets" that Stavins worships are suicidal and incapable
of self-reform even when they are producing "mass extinction" is that the markets are a system based
on greed and the desire to obtain "great possessions" even if the result is to damn us and life on
our planet.
Adam Smith propounded the paradox that greed could lead the butcher and baker (in a village where
everyone could judge reputation and quality) to reliably produce goods of high quality at the lowest
price. The butcher and baker, therefore, would act (regardless of their actual motivations) as if
they cared about their customers. Smith observed that the customer of small village merchant's products
would find the merchant's self-interest a more reliable assurance of high quality than the merchant's
altruism.
But Stavins makes clear in his writing that this is not how markets function in the context of
"external" costs to the environment. In the modern context, the energy markets routinely function
in a manner that Stavins rightly depicts as leading to mass murder. Stavins so loves the worship
of the quest for "great possessions" that he is eager to try to discredit Pope Francis as a leader
in the effort to prevent "mass extinction" (Stavins' term) – suicide by laissez faire.
(No, I am not now and never was or will be a Catholic.)
The Pope's recent comments stirred an old memory from when I was a child, for some reason.
Growing up in England in the 1980's, it didn't escape even my childish notice that the series
"Dr. Who" was often a vehicle for what would now been deemed outrageously left wing thinking and
ideas.
One such episode was
The Pirate Planet. The plot's premise was that a race had created a mechanism for consuming
entire planets at a time, extracting mineral wealth from the doomed planet being destroyed in
the process and using energy and resources for the benefit of a tiny ruling elite with the remnants
being offered as trinkets for the masses.
A small subset of the evil race was subliminally aware of what was happening. One of the lines
spoken by a character really stuck in my mind, when he said after the reality of their existence
was explained to him "so people die to make us rich?"
At the time, it was intended I think more as an allegory on the exploitation of South African
gold miners under apartheid than as a general critique of capitalism by the prevailing socialist
thinking in Britain in that era (it seems impossible now for me to believe how left wing Britain
was in the late 1970s and even into the very early 1980s, but that is indeed the case; it feels
like it was a completely different country. Perhaps it was ). No wonder the Thatcher government
aggressively targeted the BBC (who produced the show), seeing it, probably rightly, as a hotbed
of Trotskyite ideology.
But the point the show was trying to make is as valid now as it was then and is the same point
the Pope Francis is making. A great deal of our material wealth and affluence is built on others'
suffering. It is wrong. And the system which both perpetrates the suffering and the people who
benefit from it needs to change. Us turkeys are going to have to vote for Christmas.
Nice post, Clive. But I thought Brits ate goose at Christmas, and Americans eat turkey at Thanksgiving
;-)
Yes, where have all the leftists gone? Is Cornel West the only one "left" in America? Forty
years ago I was moving to the Right, in reaction to the Left. The Cold War was still on, patriotism
et al.
The current paradigm is insane so nature will not allow it to continue much longer. G-d not
so much. The US today is qualitatively different than it was in the 70s.
Trotsky was one of the first people to understand Hitler. Stalin not so much. Our current crop
of elder pundits of Neoliberalism originally were Jewish trotskyites back in the 60s. Neoliberalism
was perhaps pragmatic back then, but has outlived its usefulness.
The overweening arrogance of the Thatcherites and the neoclassical ideologues that are in evidence
at Harvard is their insistence that what they peddle is not a set of values, but a "science",
and that their set of values is the only set of values even worth considering (TINA). The Pope's
job is to remind us all of another possible set of values and organizing principles. No one said
you have to believe in them. But they have a right to be on the table when we collectively chose
what kind of world we want to live in.
"All he needs to do is give all that he owns to the poor." Bill Black
No. He is to sell all he owns but Jesus does not say that he is to then give away ALL the money.
The rich guy's problem is his possessions, not money. Note that Matthew, another rich guy, did
not give away all his money yet he was a disciple of Jesus.
As for "free markets", what is free market about government-subsidized/privileged banks?
something didn't read right about this piece to me. hard to put my finger on it, but it came
across as a bit hypocritical and a lot bitter. apart from that, the style is eclectic and the
thoughts are scrambled all over the place. more a rant than a coherent argument.
It all began when I arrived. After travelling some 48 hours from South Africa to Southern
California, carrying films and books for the conference, I was not even met at the airport.
So I took a taxi. But nobody met me at the place where I was supposed to stay. I stood on the
street for more than one hour.
in this passage he sounds like he suffers from affluenza. in those poor but righteous third
world countries, he is treated like a rockstar. in the rotten US, he is dismayed at the lack of
attention. although no doubt he has a point, it smacks a bit of entitlement.
not vltchek's best work, but then again, he did admit to writing most of it on the plane.
it seems impossible now for me to believe how left wing Britain was in the late 1970s
and even into the very early 1980s, but that is indeed the case; it feels like it was a completely
different country.
True. And greed, as described by Bill Black. has no limits.
"Theoclassical economists are the high priests of this celebration of greed that Stavins
admits poses the greatest threat to life on our planet. When Pope Francis posed a choice to
Stavins, he chose to maintain his dogmatic belief in a system that he admits is suicidal and
incapable of self-reform. The reason that the mythical and mystical "free markets" that Stavins
worships are suicidal and incapable of self-reform even when they are producing "mass extinction"
is that the markets are a system based on greed and the desire to obtain "great possessions"
even if the result is to damn us and life on our planet."
This is an extremely important point. We cannot combat neoliberal ideology as if it were simply
a set of rational assumptions, albeit flowing from flawed premises. No, it is a religious
dogma of greed, set up to combat all of the more communitarian and gentle schools of
religious thought– including the Christianity of Pope Francis, or the environmentalism of St.
Francis, the patron saint of ecologists.
Good to see that someone else pulls out the "rich young man" bit occasionally. Not many Christians
I've talked to seem to be aware of it, much less of the implications. Good on ya'.
fundamentalists like to take things in the bible literally, but they know that jesus
didn't mean it when he said that "It is easier for a camel to go through the eye of a needle,
than for a rich man to enter into the kingdom of God"
Maybe he didn't realize that his possessions owned him, but the rich young man knew that *something*
was wrong. For all his virtue and good works, he could feel things weren't right inside himself.
Pope Francis probably hasn't read The Gospel According to St. Lloyd Blankfein. If
he had read it, he would know that investment bankers are doing God's work.
"... Senior Catholic figures in the US and UK have said the Pope's central message is: what sort of world do we want to leave for future generations? ..."
"... Kurtz deflected criticism from Republican president contenders such as Jeb Bush that the Pope was straying from the pulpit into political terrain. "I don't think he is presenting a blue print for saying this is exactly a step by step recipe," Kurtz said. "He is providing a framework and a moral call as a true moral leader to say take seriously the urgency of this matter." ..."
The Pope
has warned of an "unprecedented destruction of ecosystems" and "serious consequences for all
of us" if humanity fails to act on climate change, in his encyclical on the environment, published
by the Vatican on Thursday.
Senior Catholic figures in the US and UK
have said the Pope's central message is: what sort of world do we want to leave for future
generations?
The UN secretary general, the World Bank president, plus the heads of the UN climate talks
and the UN environment programme have all welcomed the encyclical, along with scores of charities
and faith groups.
Church leaders will brief members of Congress on the encyclical on Thursday, and the White
House on Friday on the encyclical. "It is our marching orders for advocacy,"
said Joseph Kurtz, the president of the US Conference of Catholic Bishop
Cardinal Peter Turkson, the pope's top official on social and justice issues, flatly rejected
arguments by some conservative politicians in the US that the pope ought to stay out of science.
"Saying that a pope shouldn't deal with science sounds strange since science is a public domain.
It is a subject matter that anyone can get in to," Turkson said at a press conference on Thursday.
The pontiff's upcoming document is being hailed as a major intervention in the climate change
debate – but what exactly is an encyclical?
In an apparent reference to comments by Republican presidential contender Jeb Bush, who said
he did not take economic advice from the pope, Turkson said that politicians had the right to
disregard Francis's statement, but said it was wrong to do so based on the fact that the pope
was not a scientist.
"For some time now it has been the attempt of the whole world to kind of try to de-emphasise
the artificial split between religion and public life as if religion plays no role," he said.
Then, quoting an earlier pope, he said the best position was to "encourage dialogue between faith
and reason".
The secretary-general welcomes the papal encyclical released today by His Holiness
Pope Francis which
highlights that climate change is one of the principal challenges facing humanity, and that it
is a moral issue requiring respectful dialogue with all parts of society. The secretary-general
notes the encyclical's findings that there is "a very solid scientific consensus" showing significant
warming of the climate system and that most global warming in recent decades is "mainly a result
of human activity".
Ban called on governments to "place the global common good above national interests and to adopt
an ambitious, universal climate agreement" at the UN climate summit in Paris this December.
There are shades of the Pope's own language there. In the encyclical, he says: "International
[climate] negotiations cannot make significant progress due to positions taken by countries which
place their national interests above the global common good".
US church leaders said they saw the message as an urgent call for dialogue
and action – one they intend to amplify on social media and in the pulpit.
"It is our marching orders for advocacy," Joseph Kurtz, the president of the US Conference of
Catholic Bishops and the Archbishop of Louisville. "It really brings about a new urgency for us." Church leaders will brief members of Congress on Thursday, and the White House tomorrow on the
encyclical.
Kurtz deflected
criticism from Republican president contenders such as Jeb Bush that the Pope was straying from
the pulpit into political terrain. "I don't think he is presenting a blue print for saying this is exactly a step by step recipe,"
Kurtz said. "He is providing a framework and a moral call as a true moral leader to say take seriously
the urgency of this matter."
Here's a selection of some more US faith group reaction: Most Reverend Stephen E. Blaire, Bishop of the Catholic Diocese of Stockton:
This document written for all people of good will challenges institutions and individuals to
preserve and respect creation as a gift from God to be used for the benefit of all.
Rabbi Marvin Goodman, Rabbi in Residence, Jewish Community Federation and Endowment Fund, San
Francisco:
I'm inspired and grateful for the Pope's high profile leadership and commitment to environmental
justice.
Imam Taha Hassane, Islamic Center of San Diego:
Local and National Muslim Leadership support policies that both halt environmental degradation
and repair that which has already occurred. We stand with any leader, secular or spiritual,
who is willing to speak out against this issue.
Cardinal Vincent Nichols in the UK has echoed
US Archbishop Joseph Edward Kurtz in his view of what the Pope's central message is: what sort
of world do we want to leave for future generations to inherit? The Press Association reports:
Speaking at Our Lady & St Joseph's Catholic Primary School, in Poplar, east London, against the
backdrop of the skyscrapers of Canary Wharf, Cardinal Vincent Nichols said one of the key messages
of the document was asking "what kind of world we want to leave to those who come afterwards".
The pope's message challenged the idea that infinite material progress was possible, with more
goods and more consumption, that "we have to have the latest phone", said the cardinal, who is
head of the Catholic Church in England and Wales.
The US House of Representatives'
Sustainable Energy and Environment Coalition says – in an apparent reference to climate denial
on the US right – that "the political will of many is still askew" when it comes to tackling global
warming. It hopes the Pope's encyclical might change that:
For those unmoved by the science of climate change, we hope that Pope Francis' encyclical demonstrates
the virtue and moral imperative for action. Today's announcement further aligns the scientific
and moral case for climate action, yet the political will of many is still askew. The time to
act on climate is now, and failure to do so will further damage the planet, its people, and our
principles.
Pope Francis's guidance as a pastor and a teacher shines a light on the moral obligation we all
share to address the climate crisis that transcends borders and politics. This Encyclical underscores
the need for climate action not just to protect our environment, but to protect humankind and
the most vulnerable communities among us. The vision laid out in these teachings serves as inspiration
to everyone across the world who seeks a more just, compassionate, and healthy future.
In case you don't have enough time to read the 100+ page encyclical itself (the length varies depending
on the language and font size of the versions kicking around),
Some more reaction from UK charities on how governments meeting in Paris later this year should listen
to the Pope.
Adriano Campolina, chief executive of ActionAid International, said:
The Pope's message highlights the important links between climate change, poverty and overconsumption.
They are part of the same problem and any lasting solution to climate change must tackle these
fundamental issues.
The powerful truth in Pope Francis' message reaches far beyond the Catholic
Church or climate campaigners. Action on climate requires both environmental and social justice.
As negotiators work on a climate deal for Paris, our leaders must show the same moral and political
courage that Pope Francis has.
Christian conservation group A Rocha said: "national governments should follow the Pope's example
and take 'meaningful action' on climate change".
One of the most senior figures in the US Catholic church, Joseph Edward Kurtz, Archbishop of Louisville,
has been speaking at a US press conference. He said that that perhaps the central message of the
encyclical is: what kind of world do we want to leave to those who come after us?
Here are some
highlights from Kurtz:
It's really a very beautiful and very extensive treatment of what Pope Francis has called our
common home.
...
The Pope over and over again says that care for the things of this Earth is necessarily bound
with care for one another and especially those who are poor. He calls it an interdependency.
...
He speaks on very indivudal choices as well as the public sphere
...
Over and over again he talks about the world as a gift
...
He uses a phrase he's used very often: to reject a throwaway culture.
...
He talks about very specific things, about slums in which people are forced to live, the lack
of clean water, about the consumerism mentality.
And that perhaps this is the centre of his message: what kind of world do we want to leave
to those who come after us?
...
Our pope is speaking with a very much pastor's voice and with a deep respect for the role of
science.
Three essential areas that our Catholic community is being called to being involved in:
1) to advocate, a local, national and global level, to advocate for the common good. We know
that faith if done well, actually enriches public life. And we know that technology tells us what
we can do, but we need moral voices that tell us what we should do
2) [the video cut out at this point so I'm afraid I missed his second point]
3) The use of our resources, in whole we build buildings, should honour the Earth
Here's the Pope himself on that issue of what we leave future generations:
Leaving an inhabitable planet to future generations is, first and foremost, up to us. The issue
is one which dramatically affects us, for it has to do with the ultimate meaning of our earthly
sojourn.
We may well be leaving to coming generations debris, desolation and filth. The pace
of consumption, waste and environmental change has so stretched the planet's capacity that our
contemporary lifestyle, unsustainable as it is, can only precipitate catastrophes, such as those
which even now periodically occur in different areas of the world. The effects of the present
imbalance can only be reduced by our decisive action, here and now.
Summary
The Pope
has warned of an "unprecedented destruction of ecosystems" and "serious consequences for all
of us" if humanity fails to act on climate change, in his encyclical on the environment, published
by the Vatican on Thursday
The
pontiff said that the world should phase out coal in favour of gas, while renewable energy
technology scales up
The heads of the
UN climate talks and the
UN environment programme have said the Pope's intervention should act as a "clarion call"
for governments meeting in a bid to work out a climate change deal at a summit in Paris later
this year
Today's release of Pope Francis' first encyclical should serve as a stark reminder to all of us
of the intrinsic link between climate change and poverty. We know the scientific, business and
economic case for action to combat climate change and I welcome the pope's emphasis on our moral
obligation to act.
He added:
The pope's encyclical comes at a pivotal moment in the lead up to December's Paris meeting on
climate change.
The World Council of Churches welcomes Pope Francis' encyclical which catalyses what churches
and ecumenical organizations have been doing for decades on caring for the earth and climate justice
issues. By affirming human induced climate change and its impacts on the poorest and most vulnerable
communities, the Encyclical is an important call to urgently act as individuals, citizens and
also at the international level to effectively respond to the climate crisis.
Dr. Steven Timmermans, executive director of the Christian Reformed Church in North America, said:
We affirm Pope Francis' moral framing of the threats posed by climate change. We have too many
brothers and sisters around the world living on the edge of poverty whose livelihoods are threatened-and
too many little ones in our congregations set to inherit a dangerously broken world-to believe
otherwise. For too long the church has been silent about the moral travesty of climate change.
Today, the Pope has said, 'Enough is enough,' and the Christian Reformed Church welcomes his voice.
Sister Pat McDermott, president of the Sisters of Mercy of the Americas, said:
We welcome Pope Francis' critique of the current, dominant economic model that prioritizes the
market, profit and unharnessed consumption and regards Earth as a resource to be exploited.
Rev. Mitch Hescox, president of the US-based Evangelical Environmental Network, which lobbies American
politicians on environmental issues, welcomed the Pope's encyclical. He
said:
It's time to make hope happen by fuelling the unstoppable clean energy transition, stopping the
ideological battles, and working together.
Creating a new energy economy that benefits all and addresses climate change is not about a
political party but living as a disciple of Jesus Christ. We urge all people of good will, especially
fellow Christian conservatives to read and study these timely words from Pope Francis.
The New York Times' Justin Gillis says (fairly, in my opinion) that the Pope is more cautious on
the science behind climate change than many scientists.
...amid all his soaring rhetoric, did the pope get the science right?
The short answer from
climate and environmental scientists is that he did, at least to the degree possible in a religious
document meant for a broad audience. If anything, they say, he may have bent over backward to
offer a cautious interpretation of the scientific facts.
For example, a substantial body of published science says that human emissions have caused
all the global warming that has occurred over the past century. Yet in his letter, Francis does
not go quite that far, citing volcanoes, the sun and other factors that can influence the climate
before he concludes that "most global warming in recent decades is due to the great concentration
of greenhouse gases" released mainly by human activity.
The world's most authoritative body on climate science, the UN's Intergovernmental Panel on Climate
Change, found in
its landmark report last year that global warming is "unequivocal" and humanity's role in causing
it is "clear".
In some places, cooperatives are being developed to exploit renewable sources of energy which
ensure local self-sufficiency and even the sale of surplus energy. This simple example shows that,
while the existing world order proves powerless to assume its responsibilities, local individuals
and groups can make a real difference.
Bob Perciasepe of US thinktank Center for Climate and Energy Solutions,
has blogged on the unique role the Pope can play in the climate change arena and how he might
influence American minds:
Scientists, environmentalists, politicians, business executives, and military leaders have all
raised concerns for years about the real risks of climate change. But few individuals are as influential
as the pope. By calling on people to act on their conscience, Pope Francis provides a powerful
counterpoint to what has become a largely ideologically-driven debate, especially here in the
United States.
The publication of the Pope's encyclical is of enormous significance. He has shown great wisdom
and leadership. Pope Francis is surely absolutely right that climate change raises vital moral
and ethical issues. It is poor people around the world who are most vulnerable to the impacts
of climate change, such as an intensification of extreme weather events. And the decisions that
we make about managing the risks of climate change matter not only for us, but also for our children,
grandchildren and future generations.
He added:
Moral leadership on climate change from the Pope is particularly important because of the failure
of many heads of state and government around the world to show political leadership.
And here's what the Pope himself says about world leaders' failure to act on climate change and
environmental problems:
Many of those who possess more resources and economic or political power seem mostly to be concerned
with masking the problems or concealing their symptoms, simply making efforts to reduce some of
the negative impacts of climate change.
The pope's effort to sever the link between population growth and environmental deterioration
should not, however, detract from the importance of what else he has to say. This is the first encyclical
to be devoted entirely to environmental issues, though it is certainly not the first time a pope
has spoken out on the destruction of the environment.
As the encyclical notes, Paul VI first raised the issue as long ago as 1971, describing it as
a "tragic consequence" of uncontrolled human activity. Saint John Paul II and his successor, Benedict
XVI, inveighed against mankind's ill-treatment of nature – or as they viewed it, creation.
Far more explicitly than his predecessors, however, Francis heaps the blame on to the part of
humanity that is rich. He accepts that the poorer nations should "acknowledge the scandalous level
of consumption in some privileged sectors of their population and combat corruption more effectively."
They ought also to develop less pollutant sources of energy.
The Pope suggests that you can't care about nature and support abortion, which the Catholic church
strongly opposes:
Since everything is interrelated, concern for the protection of nature is also incompatible with
the justification of abortion. How can we genuinely teach the importance of concern for other
vulnerable beings, however troublesome or inconvenient they may be, if we fail to protect a human
embryo, even when its presence is uncomfortable and creates difficulties?
The other elephant in the room is birth control and overpopulation, though the Pope seems to have
anticipated criticism on that. He takes the line,
supported by many environmentalists, that consumption is the problem, not overpopulation. The
encyclical says:
To blame population growth instead of extreme and selective consumerism on the part of some, is
one way of refusing to face the issues.
The head of the UN's environment programme, Achim Steiner, has echoed
the UN's climate chief in saying today's text should be a clarion call for action.
This encyclical is a clarion call that resonates not only with Catholics, but with all of the
Earth's peoples. Science and religion are aligned on this matter: The time to act is now.
We
(UNEP) share Pope Francis' view that our response to environmental degradation and climate change
cannot only be defined by science, technology or economics, but is also a moral imperative. We
must not overlook that the world's poorest and most vulnerable suffer most from the changes we
are seeing. Humanity's environmental stewardship of the planet must recognise the interests of
both current and future generations.
Each year sees the disappearance of thousands of plant and animal species which we will never
know, which our children will never see, because they have been lost for ever. The great majority
become extinct for reasons related to human activity.
...
a sober look at our world shows that the degree of human intervention, often in the service
of business interests and consumerism, is actually making our earth less rich and beautiful, ever
more limited and grey, even as technological advances and consumer goods continue to abound limitlessly.
We seem to think that we can substitute an irreplaceable and irretrievable beauty with something
which we have created ourselves.
On GM
It is difficult to make a general judgement about genetic modification (GM) ... The risks involved
are not always due to the techniques used, but rather to their improper or excessive application
... This is a complex environmental issue
On water quality
One particularly serious problem is the quality of water available to the poor. Every day, unsafe
water results in many deaths and the spread of water-related diseases, including those caused
by microorganisms and chemical substances.
On fossil fuels
We know that technology based on the use of highly polluting fossil fuels – especially coal, but
also oil and, to a lesser degree, gas – needs to be progressively replaced without delay. Until
greater progress is made in developing widely accessible sources of renewable energy, it is legitimate
to choose the lesser of two evils or to find short-term solutions.
At the Vatican press conference, Peter Turkson, a Ghanian cardinal of the Catholic church, says US
climate sceptics are entitled to their view.
"The other big thing about Republicans and presidential figures saying they will not listen to
the Pope is that is their freedom, their freedom of choice," he said, in an apparent reference to
Jeb Bush (see
11:21).
He said "it's easy to say because the Pope is not a scientist he shouldn't talk about science",
and said "I would not attach much credibility" to those criticisms.
The pontiff included a personal handwritten note in his communication. It ended with a plea for help:
"United in the lord, and please do not forget to pray for me."
One recurring motif throughout the encyclical is a general scepticism or outright hostility to
technological solutions to environmental challenges, and to the role that big business should play
in tackling climate change.
For example:
Technology, which, linked to business interests, is presented as the only way of solving these
problems, in fact proves incapable of seeing the mysterious network of relations between things
and so sometimes solves one problem only to create others
...
To seek only a technical remedy to each environmental problem which comes up is to separate
what is in reality interconnected and to mask the true and deepest problems of the global system.
He doesn't like carbon trading either. In this passage he seems to be referring to the only current
global carbon trading scheme, the
CDM:
The strategy of buying and selling "carbon credits" can lead to a new form of speculation which
would not help reduce the emission of polluting gases worldwide. This system seems to provide
a quick and easy solution under the guise of a certain commitment to the environment, but in no
way does it allow for the radical change which present circumstances require. Rather, it may simply
become a ploy which permits maintaining the excessive consumption of some countries and sectors.
And some sections sound like they could have been ghostwritten by Guardian columnist George Monbiot:
Is it realistic to hope that those who are obsessed with maximizing profits will stop to reflect
on the environmental damage which they will leave behind for future generations?
The Pope isn't just concerned about climate change. He has some very colourful turns of phrase about
other environmental problems, such as pollution and waste:
The earth, our home, is beginning to look more and more like an immense pile of filth. In many
parts of the planet, the elderly lament that once beautiful landscapes are now covered with rubbish.
The Pope makes reference to the huge body of work by national science academies and international
bodies such as the IPCC on climate science:
A very solid scientific consensus indicates that we are presently witnessing a disturbing warming
of the climatic system.
He warns of serious consequences if we don't act on climate change:
If present trends continue, this century may well witness extraordinary climate change and an
unprecedented destruction of ecosystems, with serious consequences for all of us.
As many studies have already pointed out, the Pope notes that the world's poor are expected to
suffer most from global warming:
It [climate change] represents one of the principal challenges facing humanity in our day. Its
worst impact will probably be felt by developing countries in coming decades. Many of the poor
live in areas particularly affected by phenomena related to warming, and their means of subsistence
are largely dependent on natural reserves and ecosystemic services such as agriculture, fishing
and forestry.
The message brought an outpouring of support from environmental groups, climate scientists, and
leaders of all religions, eager to counter a series of pre-emptive attacks on the Pope from conservatives.
The response was a first glimpse of a vast and highly organised mobilisation effort around the
letter visit, and a papal visit to the US in September.
The Pope will get an another chance to exhort leaders to act – this time in person – when he addresses
both houses of Congress.
With that high profile visit in mind, campaigners argued the Pope's intervention had re-set the
parameters of the discussion surrounding climate change, from narrow political agenda to broader
morality. The Pope's message was above religion, they said.
"The Pope's message applies to all of us," said Rhea Suh, president of the Natural Resources Defense
Council. "He is imploring people of good will everywhere to honour our moral obligation to protect
future generations from the dangers of further climate chaos by embracing our ethical duty to act,"
she said.
Cafod, the Catholic charity went so far as to suggest that that was the Pope's design all along.
"The Pope has deliberately released the encyclical in a year of key UN moments that will affect
humanity," said Neil Thomas, director of advocacy. "He is reading the signs of his times and telling
us that the human and environmental costs of our current way of life are simply too high."
Ray Bradley, the climate scientist, said: "He has no political agenda. He speaks from the heart
(not the Heartland) with unimpeachable moral authority. Who else can address this issue without the
taint of politics? Moreover, Pope Francis has a particular responsibility to those without a voice
at the centres of power in affluent countries.
But the Pope's message is expected to resonate most strongly among the environmental campaigners
operating within the Church.
For activist priests and nuns, who have lobbied oil companies and called on their own parishes
to divest, the encyclical puts the Vatican's stamp of approval on years of effort, often at the sidelines.
That on its own has galvanised campaigners, said Sister Joan Brown, a Franciscan in New Mexico
who has worked on climate change for more than 20 years.
"I've never seen anything like this in the faith community or otherwise," she said.
The pope's message set off a flood of new activity that has been more than a year in the planning.
In deference to the Pope, mainstream environmental groups will be operating in the background.
"We've been asking environmental groups to hold back on this...so that the message isn't one that
would maybe cause more polarisation, rather than less," Sister Joan said.
But the Catholic church – and activist wings among other religious communities – are jumping in
to try and amplify thePope's message and build momentum for action on climate.
The archbishop's office in Atlanta signed up scientists and engineers to help parishes, and parishioners,
reduce their carbon footprint. The Bishop of Des Moines is planning to hold a press conference at
a wind farm.
The Evangelical Environmental Network also came out strongly behind the Pope.
More than 300 rabbis signed on to a letter calling on Jewish institutions and individuals to divest
from "carbon Pharaohs" or coal-based electric power, and buy wind power instead.
As Pope Francis reaffirms, climate change is an all-encompassing threat: it is a threat to our
security, our health, and our sources of fresh water and food ... I applaud the Pope for his strong
moral and ethical leadership. We need more of such inspired leadership. Will we see it at the
climate summit in Paris?
The Pope is right – climate change is a problem for all of humanity that is hitting the world's
poorest hardest. His words could and should add real urgency to efforts to protect people and
planet. World leaders meeting at the UN climate talks in Paris later this year should be in no
doubt that the world expects them to put aside short-term national interest and move us all closer
to a safer and more prosperous future.
Andrew Steer, president and chief executive of the US-based World Resources Institute:
The pope's message brings moral clarity that the world's leaders must come together to address
this urgent human challenge. This message adds to the global drumbeat of support for urgent climate
action. Top scientists, economists, business leaders and the pope can't all be wrong.
The encyclical is unimpressed by those who deny the science of climate change:
regrettably, many efforts to seek concrete solutions to the environmental crisis have proved ineffective,
not only because of powerful opposition but also because of a more general lack of interest. Obstructionist
attitudes, even on the part of believers, can range from denial of the problem to indifference,
nonchalant resignation or blind confidence in technical solutions.
The pushback from Republican and the rest of the US right, where climate scepticism is a badge
of honour, has already begun. Jeb Bush, the Republican presidential candidate,
said yesterday: "I hope I'm not going to get castigated for saying this by my priest back home,
but I don't get economic policy from my bishops or my cardinal or my pope."
And as our US environment correspondent Suzanne Goldenberg found out last week at a gathering
of US climate sceptics, the Pope's encyclical is at the top of their list of concerns.
Suzanne Goldenberg visits the Heartland Institute's conference in Washington, an annual gathering
of climate sceptics, to hear what delegates – including US senator James Inhofe and blogger Marc
Morano – think about the Pope's encyclical on the environment and climate change
Christiana Figueres, the UN's climate chief, says the Pope's intervention should act as a "clarion
call" for a strong deal at Paris:
Pope Francis' encyclical underscores the moral imperative for urgent action on climate change
to lift the planet's most vulnerable populations, protect development, and spur responsible growth.
This clarion call should guide the world towards a strong and durable universal climate agreement
in Paris at the end of this year. Coupled with the economic imperative, the moral imperative leaves
no doubt that we must act on climate change now.
Christiana Figueres. Photograph: Martin Godwin/Martin Godwin
But the Pope isn't very impressed by more than 20 years of UN climate talks. He says the annual
summits have produced "regrettably few" advances on efforts to cut carbon emissions and rein in global
warming. The encyclical says:
It is remarkable how weak international political responses have been. The failure of global summits
on the environment make it plain that our politics are subject to technology and finance. There
are too many special interests, and economic interests easily end up trumping the common good
and manipulating information so that their own plans will not be affected.
John Schellnhuber, Angela Merkel's climate adviser and a leading climate change scientist, is punning
his way through a presentation at the encyclical's launch, "praying" his Powerpoint will work.
Of the encyclical, he said:
it is very unique in the sense that it brings together two strong powers in the world, namely
faith and moral and on the other reason and ingenuity. It's an environmental crisis but also a
social crisis. These two things together pose an enormouse challenge. Only if these two things
work together, faith and reason, can we overcome it
A spokesman for the Vatican told a packed press conference in the Vatican audience hall this morning
that in his 25 years there he has worked there, he has never seen as much prolonged, global and intense
anticipation for a single document, AP reports.
The press conference is being live-streamed on YouTube:
The more-than-100 page text is wide-ranging,
majoring on climate change, but also touching on pollution, biodiversity loss, the oceans, man's
modern relationship with nature, the dangers of relying on the markets and technology, and overconsumption.
The more than 190 countries involved in the international climate change will be keenly watching
the text too – it could have a big impact on the talks ahead of a
major summit in Paris later this year.
"... "Humanity is called to recognize the need for changes of lifestyle, production and consumption, in order to combat this warming or at least the human causes which produce or aggravate it," he adds. ..."
Pope Blames Markets for Environment's Ills. Pontiff condemns global warming as outgrowth of global consumerism. Pope Francis said human activity is the cause of climate change, which threatens the poor and
future generations.
ROME- Pope Francis in his much-awaited encyclical on the environment offered a broad and uncompromising
indictment of the global market economy, accusing it of plundering the Earth at the expense of the
poor and of future generations.
In passionate language, the pontiff attributed global warming to human activity, blamed special
interests for holding back policy responses and said the global North owes the South "an ecological
debt."
The 183-page document, which Pope Francis addresses to "every person living on this planet," includes
pointed critiques of globalization and consumerism, which he says lead to environmental degradation.
"The Earth, our home, is beginning to look more and more like an immense pile of filth," he writes.
The encyclical's severe language stirred immediate controversy, signaling the weight the pontiff's
stance could have on the pitched debate over how to respond to climate change.
"Economic powers continue to justify the current global system where priority tends to be given
to speculation and the pursuit of financial gain," he writes. "As a result, whatever is fragile,
like the environment, is defenseless before the interests of the deified market, which become the
only rule."
The Vatican published the document, titled "Laudato Si" ("Be praised"), on Thursday. The official
release came three days after the online publication of a leaked version by an Italian magazine.
The Vatican spokesman, the Rev. Federico Lombardi, had described the leaked Italian text as a
draft, but the final document, published in eight languages, differed only in minor ways, while the
pope's main points were identical. An encyclical is considered one of the most authoritative forms
of papal writing.
In the encyclical, Pope Francis wades into the debate over the cause of global warming, lending
high-profile support to those who attribute it to human activity.
A "very solid scientific consensus indicates that we are presently witnessing a disturbing warming
of the climactic system," contributing to a "constant rise in the sea level" and an "increase of
extreme weather events," he writes.
"Humanity is called to recognize the need for changes of lifestyle, production and consumption,
in order to combat this warming or at least the human causes which produce or aggravate it," he
adds.
While acknowledging natural causes for climate change, including volcanic activity and the solar
cycle, Pope Francis writes that a "number of scientific studies indicate that most global warming
in recent decades is due to the great concentration of greenhouse gases (carbon dioxide, methane,
nitrogen oxides and others) released mainly as a result of human activity."
The pontiff goes on to argue that there is "an urgent need" for policies to drastically cut the
emission of carbon dioxide and other gases and promote the switch to renewable sources of energy.
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On Global Warming, Pope Francis Is Clear but U.S. Catholics are Divided
Scientists Back Pope Francis on Global Warming
In a slight digression from the usual pure market-based discussions of Jeremy Grantham's perspectives, the fund manager
addresses what is potentially and even more critical factor for the markets. As he writes, we are in a race for our lives,
as our global economy, reckless in its use of all resources and natural systems, shows many of the indicators of potential
failure that brought down so many civilizations before ours. By sheer luck, though, ours has two features that
might just save our bacon: declining fertility rates and progress in alternative energy.
Our survival might well depend on doing everything we can to encourage their progress. Vested interests, though, defend the
status quo effectively and the majority much prefers optimistic propaganda to uncomfortable truth and wishful thinking rather
than tough action. It is likely to be a close race.
Via GMO,
The Fall of Civilizations
The collapse of civilizations is a gripping and resonant topic for many of us and one that has attracted many scholars over
the years. They see many possible contributing factors to the collapse of previous civilizations, the evidence pieced together
shard by shard from civilizations that often left few records. But some themes reoccur in the scholars' work: geographic
locations that had misfortune in the availability of useful animal and vegetable life, soil, water, and a source of energy;
mismanagement in the overuse and depletion of resources, especially forests, soil, and water; the lack of a safety margin or
storage against inevitable droughts and famines; overexpansion and costly unnecessary wars; sometimes a failure of moral spirit
as the pioneering toughness and willingness to sacrifice gave way to softer and more cynical ways; increasing complexity of a
growing empire that became by degree too expensive in human costs and in the use of limited resources to justify the effort,
until the taxes and other demands on ordinary citizens became unbearable, so that an empire, pushed beyond sustainable limits,
became vulnerable to even modest shocks that could in earlier days have been easily withstood. Probably the greatest
agreement among scholars, though, is that the failing civilizations suffered from growing hubris and overconfidence: the belief
that their capabilities after many earlier tests would always rise to the occasion and that growing signs of weakness could be
ignored as pessimistic. After all, after 200 or even 500 years, many other dangers had been warned of yet always they had
persevered. Until finally they did not.
The bad news is that as I read about these varied scenarios – and I have missed listing several – they all appear plausible
and each seems to be relevant to several earlier collapses of empires and civilizations both large and small. Very recently, one
of these scholars, William Ophuls, wrote a new book, Immoderate Greatness (a quote from Gibbons's Decline and Fall
of the Roman Empire), with the subtitle Why Civilizations Fail. It is a straightforward summary and synthesis of
all of the ways to fail in 70 small pages, yet with extensive notes and references. It is written in remarkably accessible,
simple language and divides the causes of failure into six categories. Unfortunately, all six seem to apply to us today in
varying degrees, and where one factor might be manageable – although often has not been – he makes the chances of our managing
all six seem slight. It is persuasive and needs to be read. It takes about two hours.
William Ophuls's conclusion is that we will not resist the impressive list of erosive factors and that, in fact, we
are in the fairly late stages of our current civilization's race for the cliff edge with nothing much to head us off.
His study of history leads him to believe that civilizations are actually hard wired to self-destruct: programmed to be
overconfident, to keep on pushing for growth until limits are overstepped and risks accumulated to the breaking point. His offer
of good news is that after the New Dark Ages, when civilization again rears its head, presumably with a much smaller population,
we will have acquired the good sense to be less overreaching, less hubristic, a lot humbler about growth and our use of
resources, and more determined to live in balance with the natural energy we receive from the sun and the heat, food, and water
with which we can sustainably be provided.
I have just two comments about our current problems. First, that there is one particular pressure this time
that seems particularly serious: aversion to bad news. The investment business has taught me – increasingly as the years have
passed – that people, especially investors (and, I believe, Americans), prefer good news and wishful thinking to bad news; and
that there are always vested interests to offer facile, optimistic alternatives to the bad news. The good news is obviously an
easier sell. Good news in investing in particular is better for business; good news on resource limitation is better for the
suppliers of resources; and good news on climate change – that it basically does not exist and is even a hoax – is better for
energy companies, among the biggest and most profitable of all companies. Historians have pointed out the bias against the need
for change: there are always clear beneficiaries of the current state of affairs but the benefits of a changed world in contrast
will look vague and uncertain to the likely beneficiaries. That is always the case. What is less common, although not unique in
history, is what we have today: the near complete control of government by the powerful beneficiaries of the current system.
The second point is that although I find Ophuls's argument well-reasoned and although I must acknowledge the strong
possibility of a very negative outcome, I feel it is too pessimistic (which, sadly, is a rare occurrence for me on this topic).
Yes, we are taking extreme risks with resource depletion and with the environment, especially concerning climate damage
and ocean acidification.
Yet I believe the case for the near certainty of our running off the cliff misses the existence of two extraordinarily lucky
(and, one could argue, undeserved) gifts that were not available to any prior stressed civilization. They may arrive like the
U.S. Cavalry, just in time to turn us away from the cliff edge. But at best, as Wellington is famously paraphrased as saying
about the Battle of Waterloo, it will be a "damn closely run thing." It will be the race of our lives.
Our Last Best Hopes: Declining Fertility and Improving Technology for Renewable Energy
Declining Fertility
The first of the two incredibly fortunate factors that might enable our current world to avoid at least partial collapse is
declining fertility. Malthus correctly analyzed the main problem of our then history (in 1800): population had always
kept up with food supply, leaving even successful societies only a few bad growing seasons away from starvation. He
predicted that this would always be the case and he was wrong on two counts. The first is a short-term factor – only existing
for 200 or 300 years and therefore irrelevant for the longer term of our species – and that is the increased ability to extract
previously stored energy in the form of coal and oil. This hydrocarbon interlude will end either when that share of hydrocarbons
that can be extracted economically is used up, or more likely when the tyranny of the second law of thermodynamics imposes its
will: enough of the higher forms of convenient compact energy like coal and oil will have been converted into heat, waste, and
especially carbon dioxide to ruin our climate in particular and our environment in general.
Malthus, however, completely missed declining fertility, a potentially very long-term and hence much more critical
factor to the survival of our species. Neither he nor anyone else before 1960 even dreamed that we would voluntarily
decide to have fewer children even as we became richer. In his day and until the early twentieth century, rich families
routinely had eight or more children. Ironically, it has turned out that the same instincts that bring us the problems of
excessive consumption and unnecessarily rapid resource depletion have also brought us the attitude that children are
inconvenient and desperately expensive. Improved medical services that further allowed populations to explode now allow the
confidence to have smaller families. Increased farm technology lowers the significance of the labor from many children. The most
obvious drivers of lower birth rates, though, are the improved education of women and advances in birth control methods. The net
effect of these factors is a change so profound that just a hundred years ago it was not even guessed at, and indeed population
growth and fertility continued to rise until about 1960 – just the other day.
The following exhibits show the remarkable and promising data. The dashed horizontal line at 2.1 in Exhibits 1 through 4 is
the fertility level required to have a stable population in the modern world under normal conditions. Exhibit 1 shows the
remarkable drop in fertility in the richer East Asian countries, including China, with almost a fifth of the world's population.
Exhibit 2 shows the drop in the larger and wealthier countries to an average level just below replacement,
with the very latest update for U.S. fertility in 2012 dropping below replacement.
Exhibit 3 shows selected important and sometimes spectacularly unexpected examples. At the top of the
unexpected list is Iran, which has dropped from a fertility rate of 7 – children per woman! – in 1960 to an almost unbelievable
1.6 today. Another remarkable example of a large Islamic country is Bangladesh, which has also fallen from 7 in 1960 to 2.2.
This is extraordinary given their extreme poverty. The particularly important India, with its 1.2 billion people, has fallen
from 6 to 2.6. This is quite remarkable in absolute terms, but given the previous two examples and given India's pressure from
overpopulation, it's almost a disappointment.
Exhibit 4 shows the more serious disappointments. Yes, the rates have dropped in these countries, but their populations are
still growing rapidly and most of them have intermittent food problems already. They are almost all in Africa.
Unless they and the world are lucky and they improve (perhaps with appropriate help from rich countries), we are
likely to end up looking to the students of long-term civilizations as if we have had two separate systems: one in
Africa, with failed states, poverty and malnutrition, and rapid population growth, probably having been left increasingly to
cope on their own; the second in the rest of the world, with substantial and still growing affluence and with fertility below
the replacement rate, forming a single market for resources and global trade in general, and trading as if they comprised one
gigantic old fashioned imperial economy.
This remarkable decline in fertility is our last best hope, both from our civilization's point of view as well as for
the well-being of all of the life on our planet. Exhibit 5 summarizes the past data and projects the more optimistic
end of the U.N. data for future global population. The world's population is shown peaking around 2050 at just over 8 billion
and then declining to near 6 billion by 2100. Ex-Africa, it reaches just under 6.5 billion in 2040 and declines to below 4
billion in 2100, back to where it was in about 1978. Africa is shown growing from about 250 million in 1950 to well over a
billion today and, even under this relatively favorable outlook, continuing to expand to over 2.3 billion by 2100. The U.N.'s
more pessimistic end of the range (not shown) has a continuing rise in population, but at a slowing rate, to 11 billion and
beyond. At that level the stresses on global food and on global law and order, especially in Africa, will almost certainly be
too great and Ophuls's prediction will likely be correct. The lower population track, in contrast, holds out a strong hope of
survival – that is, of maintaining a reasonably stable global civilization and continuing to improve the quality of the average
life.
The return, therefore, to helping encourage a lower population everywhere is incredibly high. Yet little is done at an
international level and indeed the issue is treated like a hot potato even by usually well-meaning NGOs. But we can do
it, and my guess is that we will indeed succeed on this front. In the meantime it would be encouraging if economists, The
Economist
(not to pick on them but I tend to hold them to higher standards than others), and economic discussions in general would
look out a few more years and stop discussing lower population growth as if it were a dire economic threat rather than our last
best hope. Of course, as growth rates drop rapidly and populations quickly age, there is an added burden to workers of carrying
more non-workers for one generation as the changes flow through the system. Then things stabilize again. This cycle can
be ameliorated enormously by having older people extend their contributions and by facilitating the full participation of women
in all countries. The ruinous alternative is to have an ever-growing population run off the cliff collectively. The
economics industry has indeed done a particularly inadequate job on long-term sustainability in a world of finite resources. It
is a good time for them to wake up to the problems we face on this front. Fortunately, individual decisions on fertility might
well get the job done anyway, without any help from a potentially less blinkered and longer-term economic theory.
Renewable Energy
This brings us to the second remarkable gift, which involves a branch of the "cornucopian" optimism that I usually
deplore: that the infinite human brain combined with technology will solve all problems. Yes, this is the same brain
that brought us World War II, several thousand years of soil erosion, and the collapse of endless empires. An obvious generic
weakness in this cornucopian argument is that it ignores our massive dependence on cheap energy. Trains and coal, cars and gas,
and electricity and air conditioners and refrigerators in turn drove forward economic activity and the feeling of well-being
(try being in Sydney on January 18, at 114.4°F, the hottest day in that seaside city's history, without air conditioning!), but
each came with a cost – an increased wave of energy use, almost all of it from our irreplaceable stores of oil and coal. Yet
now, finally, there is an example of a great technological leap that for the first time is accompanied by less energy use – the
technologies of solar, wind power, and other alternatives as well as electric grid efficiencies and improved energy storage.
For once, all of the innovations, corporate start-ups, and risk taking – the best part of the capitalist system – work
to decrease our use of depleting hydrocarbons and therefore to increase our chance of stabilizing our civilization before the
cliff edge is reached. Exhibit 6 shows in orange the truly remarkable decline in the cost of electricity from photo-
voltaic cells. The only thing to compare it to is the Moore's Law decline in the price of semiconductors.
That would indeed be a happy comparison, for perceived physical limits to semiconductor progress have been overcome time and
time again. If the physical limits on photovoltaic efficiency, and hence its price, are similarly maneuvered in future decades,
then the price of photovoltaic energy would guarantee us cheap and plentiful energy forever. Wind power may also be vital in
less sunny zones, but there the cost reductions are, probably, mainly behind us. Exhibit 6 shows in green the early rapid
declines in the costs of wind power mainly as improved technology allowed for increases in size and therefore efficiency.
However, during the great leap in resource costs between 2002 and 2008, which I have been obsessing about for the last two
years, the price of steel, cement, and aluminum from which wind towers are built (and all of which are incredibly
energy-intensive), all rose from two to three times! Only the flat cost of human labor and improved turbines allowed for wind
costs to rise by only 40% during this period. Our exhibit allows for only modest reductions in future wind costs, so that even
by 2025 wind costs are estimated to be still higher than 2000, before the great surge in material prices. The remaining
component of Exhibit 6 is the cost of coal-fired electricity.
For future estimates we have made a range. The lower end represents a modest 1% a year increase in coal prices and the upper
end 4% a year, which is still a little less than the 5% annual average price rise for coal of the last 10 years. As can be seen,
by 2025 to 2030 both solar and wind power are likely to be cheaper than coal. All of these comparisons, of course, are made
without charging coal for "externalities" – those ills that the coal industry inflicts that we the people have to pay for:
mountain tops ripped off and mountain streams polluted, acid rain, and particulate matter damaging health. Even more serious in
the long run, the CO2 that is released by burning coal imposes the increasing costs of rising global temperatures: unstable
weather for crops and rising costs of more extreme weather-related events. Coal is likely to be a hopeless choice for
electricity generation in 20 years, as its price rises and those for alternatives fall, but fully costed for externalities it is
an uneconomic choice today. Any potential investors today in a new coal-fired utility should ask some tough questions about
"stranded assets" – cost-ineffective assets that will not have had the time to make a positive return on their investment before
they will have become uncompetitive or illegal, caught between the falling costs of alternative energy and the rising costs of
controlling for "externalities" – pollution and climate damage – that were once passed on as public costs but that will become
steadily the responsibility of the emitter.
We have the time, technology, and money to completely replace nonrenewable energy in 30 to 50 years and, on average,
in that time period such replacement will be economic (less so in the earlier years but by a wide margin later). As we
do it, we will increasingly have much lower marginal costs, for what is often forgotten in these comparisons is that the high
cost component in our two main alternatives, solar and wind, are up-front capital costs. Once constructed, the marginal costs of
merely operating the wind and solar farms is far, far lower than the marginal costs of digging and shipping coal, even without
those other health and environmental costs borne by the general public. You should be aware that when we calculate the costs of
alternative energy projects, a high corporate discount rate is used to reflect the idea that to a corporation a dollar spent
today to build a wind power project needs to be offset by a dollar and 10 or even 14 cents next year, or $8 or so in 18 years,
to pay for the current loss of the use of money and to jump over the corporation's hurdle rate for attractive investments.
The required investment return (hurdle rates) for alternative energy investments is often higher than for traditional corporate
investments partly because of unnecessary uncertainties still surrounding these projects: erratic government policies,
rapidly changing technologies resulting in most projects having new features, and general unfamiliarity to providers of capital.
But what of the social benefits of these alternative energy projects? Personal average wealth and income has
been rising by only 1% to 3% a year for the last 30 years, not 10% or 14%! Solving our long-term energy problems may not only be
the most critical economic problem, it may also, as I argue here, be one of two most critical inputs into our future viability
as a civilization. A discount rate that would reflect this significance should obviously, in a reasonable world, be far less
than the 10% or 14% return needed by a corporation for such projects. I could make a case for a zero social return hurdle in
this extreme case, but let us merely settle for a lower-than-average corporate hurdle rate – say, 5%. At a 5% real return
(which, by the way, compares to an average delivered 7% real return on all corporate capital in the past), these wind and solar
projects would have a much lower levelized cost of energy (the cost that reflects both operating and capital costs) than they
would have at higher corporate rates – up to 40% lower. At those lower capital costs typical wind power projects would have a
lower "levelized cost" than a typical coal-fired plant and be far ahead in 10 years. Solar farms would still need 10
years at the current rate of progress in cost reductions to catch up with wind power (although roof-top solar is
getting to retail rates as we speak). The point to remember is that once the capital is found and the project is built, a wind
or solar farm delivers far cheaper energy than a coal-fired utility plant, at around one-third of the marginal cost of coal
(about 1¢ per kilowatt hour at a minimum of 3¢ for coal).
The impressions the average businessman carries in his head tend to be a moving average of the last five years'
information. Life is too busy to keep up with everything and usually five years is recent enough. But when there is a
sudden shift in a year or two, average opinion is left sometimes far behind and that is exactly what has happened to solar
energy and to a lesser extent to wind power. The current issue of Prospect magazine in England carries a story of an
energy expert who invested three years ago in heavily subsidized home solar panels in the U.K. because doing so more or less
guaranteed a 7.5% return (tax-free because the benefit comes in the form of lower bills), which for a low-risk investment was
and is far better than anything else these days. You might suspect, the author argued, that the recent two-thirds drop in
subsidies would end that game, but he points out that the installation costs of panels (adjusted for increased efficiency) have
also dropped from £6,000 to £2,000 for a typical home in just over two years so that homeowners still receive a handsome return.
You can just imagine how much easier it is to get a handsome return, without subsidy, at these new lower prices in areas where
the sun actually shines – say, California, which receives almost twice the sun of London. (I'm stinging from a totally grey
month in London.) At the other end of the spectrum, Duke Power was reported in Bloomberg as stating that the cost of solar
panels to them had dropped by 75% in two years. These are truly remarkable shifts and now even modest steady progress from here
will get the job done. Meanwhile in wind, the very latest large-scale wind farm in Australia was announced as having levelized
costs lower than recent coal plants. All in a world where the cost of coal has doubled and oil quadrupled since 2000. This is
not the same game that it was just three years ago.
Energy Storage
Energy storage is now the Holy Grail of environmental progress. The bad news is that progress in the past has
been slow. The good news is that there are now scores, if not hundreds, of research teams working on this. Before wind and solar
reach a large percentage of total electricity production, it is extremely likely in my opinion that some real cost progress will
be made in storage (halving or so), especially at the retail level where a storage device, unlike a car battery, can be heavy,
bulky, and relatively inefficient as long as it is cheap. Cheapness would deliver to the household electric market the
potential for grid independence. However, let it be admitted that lack of expected progress in energy storage could
materially slow down the rate at which alternative energy is adopted. It is therefore an area that particularly needs
encouragement and good fortune.
Smart Grid
Over several decades, modernizing the grid to allow much wider and more efficient transfer would dramatically reduce
storage needs. Reaching into homes and using temporary electric car battery and refrigerator adjustments, etc., (all by
agreement and for a discount) would also reduce the problem. As back-up, natural gas electric generation is the ideal technology
with perhaps some use of bio mass and urban waste. Coal for electricity generation is just not necessary today in the U.S., and
the last coal plants anywhere may be built in the next 20 years.
Chinese Cavalry to the Rescue
On this topic, I have high hopes of China setting a brilliant example. They are embarrassingly long capital,
accused of wasting much of their 50% of GDP capital investments on subway stops in the middle of farm fields, empty cities, and
redundant regional airports. We, in contrast, are embarrassingly short capital, with capital spending having fallen to 16% of
GDP and federal debt owed to the public having accumulated to over 70% of GDP and currently increasing at 6% of GDP per year.
China could smooth out their potentially dangerous transition from 50% capital spending to a more reasonable 35% over the next
20 years or so by managing a giant program of alternative energy, including the smartest-yet national grid and
broad-based research into storage, and all sources of renewable energy, including fusion. (As with the U.S., natural gas from
fracking would help in the transition.) Such a massive broad- based program would potentially give them global dominance in the
most important industries of the future and would relieve them of their greatest single worry: energy security. It would also
relieve them of what will surely become their greatest societal irritant: the incredible air pollution of their major cities,
which must already be reducing life expectancy in those cities by several years, as well as substantially increasing health
costs. Best of all for them, it would leave them as the low-cost energy player in global trade, and if that, added to their
lower labor costs, rising educational standards, rapidly improving infrastructure, and capital deepening, does not put the fear
of God into U.S. capitalists, then it should.
It would be a blessing in disguise for the developed world and the U.S. in particular if China announced a 25-year
program of alternative energy (enough of these paltry five-year plans!) that embodied a Manhattan project level of
commitment. Within just a handful of years of watching them execute this program, we would calculate the competitive
consequences and would be forced defensively to emulate them. We would surely discover that we are in fact still wealthy and can
afford worthy projects with long-term payoffs and that our perceived poverty is more about leadership and perceptions than it is
about reality. The U.S. is, after all, richer than it has ever been and is still the richest large country in the world. I have
made a part of this point before. I am repeating it because: a) it's very important; and b) the Chinese government has
inexplicably failed to snatch up my idea. It would be a lay-up for them if they did. (Dear Chinese translator, a "lay-up" means
"an easily achievable goal.") In a world lacking U.S. leadership in energy sustainability, a truly major Chinese effort might be
the difference between collective global success and failure. In this case it would be the Chinese cavalry heading us off at the
cliff edge, but I'll take any cavalry we can get.
(Postscript: recent, several leading Chinese cities recorded disastrous levels of pollution. On a scale where 30 is the
barely safe limit, they hit over 300 several times. The Chinese government responded almost immediately, which was not a bad
idea, because yearly reoccurrences of dangerous pollution will pretty soon guarantee that some smart but critical people will
move out of these worst cities. Wouldn't you? They upped their current target [already very aggressive by U.S. standards] for
installed solar generation capability in just three years by 65%! Astonishing by any standard and currently politically
impossible outside China. This new target means that they will have the equivalent in solar power of seven or so giant
coal-fired plants, a very large absolute number anywhere except in China, where it is still dwarfed by coal plants. But, it is a
down payment.)
Epilogue
The two favorable factors described, with luck and some improved effort and leadership, may buy us enough time to
completely retune our agricultural system, for it will take many decades to change attitudes and build the
infrastructure, training, and research to move to complete agricultural sustainability. That in turn would allow us time in a
stable environment to address the problem that will no doubt take the longest time of all: addressing our failing supplies of
metals. Yes, we are blessed with large supplies of aluminum and iron ore, although, like agriculture and civilization itself,
their usefulness to us is completely dependent on the availability of cheap energy. More to the present point, affordable
supplies of most other metals, some very useful, will run low this century and must be replaced by organic alternatives, which
process will need all the time and research that success with the other factors might be able to deliver.
Suspended over this close horserace between destructive and regenerative forces are the wild cards of rising
temperatures, slowly rising sea levels, ocean acidifi cation, and, above all, destabilized weather for farming. Even if
the cavalry arrives in time to prevent the main disaster – a rolling collapse of much of civilization – much damage is being
done and will definitely continue to be done to the environment and biodiversity as global temperatures continue to rise. But
with improved behavior, we may well buy enough time to save our own species and most of what we really value. In my opinion, all
of the other factors in this mix are reasonably susceptible to data and analysis. The scary part of the climate issue is that by
its nature there can be no precision on extent or timing and, consequently (as I have mentioned before), scientists, in their
desire to avoid being seen to exaggerate, end up systematically underestimating the case.
The January 23 New York Times science section, for example, had an article on rising sea levels that said that the
authors – scientists all – "share an emerging consensus that the increase in ocean level in this century will probably be on the
order of three feet, perhaps as much as six feet," requiring many millions to evacuate. "But many scientists," they add
"are plagued by a nagging fear… that their calculations will turn out to have been too conservative, and social stability will
eventually be threatened." "At every point as our knowledge increases," Dr. Raymo, the leader of the project, is quoted
as saying, "we've always discovered that the climate system is more sensitive than we thought it could be, not less." [Emphasis
added.] To be perhaps a little cruel, a statistician might suggest that after serial underestimations, expectations might be
adjusted.
The bottom line is that if we put our minds to it we can overcome normal inertia and abnormally powerful vested
interests that oppose necessary change. Our population is likely to start declining in a few decades, slowly but
surely, and the fertility rate of 1.8% or less would allow global population to fall back more or less gracefully by 2200 to a
probably sustainable level of 4 billion, particularly if we sensibly encourage its decline. Important progress in alternatives
is certain. Other scientific progress, especially in computing power will also help. Whether we can move fast enough on these
fronts and at the same time reduce the output of greenhouse gases to avoid going off the cliff is simply not knowable for
certain, but every minute saved and improvement made, betters our odds. Let the race begin.
Correction: Natural Gas Forecast
I am bullish about the longer-term price of natural gas and in my personal account I am long the futures several years out. At
five years out, the implied price is $4.50 mcf. However, in the Q&A section of a talk I gave recently I was quoted as saying
that in five years the price "would have tripled." This implies a price, then, of $12. This is either a misquote or a misspeak.
What I intended to say and have said before was that from the low last year the price would be likely to triple in 5 years: that
is to about $6 or $7 mcf, far above the assumed $4.50 then, but far below the number in the quote.
In my review of John Quiggin's Zombie Economics
I started to develop a theme about the nature of neoliberalism that goes beyond his focus on a set of flawed economic ideas and
their application:
So why do market liberal ideas persist despite being disproved in practice? Quiggin suggests a mixture of the influence of
vested interests and institutional inertia among economists. Both are true, but they overstate the independent power of the
ideas he is critiquing. His description of the history of policy responses to the crisis of the 1970s exposes a rapidly
shifting theoretical terrain, more consistent with a desperate and pragmatic search for a solution to recession on capital's
terms. So under "really existing neoliberalism" the state never removes itself from economic life, it rather acts more
aggressively for elite interests. Market mechanisms don't get applied neutrally but to increase the exploitation of workers
and increase profitability at ordinary people's expense. And behind every mystification within neoliberal ideology is the
drive to make the majority class pay for the restoration of the minority ruling class's power and wealth.
Quiggin ends with a modest program for mainstream economics, one that is necessarily lacking in hubris because he doesn't
claim to have "the answer". Yet he strongly implies that the ideas of market liberalism will eventually die out as a result of
their practical failure (currently for him they exist mainly in reanimated, "zombie" form, hence his title).
In their recent paper
"Postneoliberalism and its
malcontents", Jamie Peck, Nik Theodore and Neil Brenner argue that the nature of the neoliberal project is unlikely to have
a "Berlin Wall" moment of final collapse, of the sort prophesised by everyone from
Eric Hobsbawm
to
Kevin Rudd. They acknowledge "the free-market project is on the ropes", but that this is not the same as there now being a
simple path towards some clear new arrangement. They argue this is for three main reasons, related to the nature of the dynamic
process of "neoliberalisation".
First, attempts at post-GFC economic policy reconfiguration have seen "flamboyant denunciations of the follies of
laissez-faire, delivered from right stage as well as left, coincide with desperate efforts to reboot some reformed version of
the same system". This is because neoliberalisation is a variegated and decentred process. It is also about managing crisis,
displacing and postponing risk rather than eliminating its destructive effects.
Second, unlike the crises of state capitalist (Keynesian or Stalinist) growth models that opened the way to neoliberalisation,
this time there is no alternative elite economic ideology awaiting its chance to take centre-stage. Instead responses have been
largely pragmatic, aimed at defending and extending capitalist interests but without any clear endpoint in mind: "The crisis
managers seem effectively to be flying blind, and occasionally will confess as much." Indeed, the very same layer of technocrats
who brought us the GFC are entrusted with fixing the mess, using largely the same toolkit and with no coherent ideological
alternative to challenge their hegemony. The lack of alternatives can be seen not only with Quiggin, but in
All That's Left, a recent
collection of essays on directions for the ALP. While claiming a postneoliberal orientation, it mostly fits the picture of "a
harder-edged form of the revisionist accommodations and centrist triangulations fashioned by the likes of Blair, Clinton and
Schroder during the 1990s."
Finally, the authors see neoliberalisation as a "hegemonic restructuring ethos, as a dominant pattern of (incomplete
and contradictory) regulatory transformation, and not as a fully coherent system or typological state form". In some ways it
cannot exist except in relation to the structures and policies it seeks to break apart and obliterate, developing as a "mongrel
phenomenon" rather than being divided from them by an iron curtain. In this sense the current crisis might leave market liberal
ideology discredited, but its practical (rather than theoretical) aspect may be what really survives in zombie form, most likely
in as many different and specific permutations as it did before the GFC.
Does this crisis signal the end of neoliberalism? My answer is that it depends what you mean by neoliberalism. My
interpretation is that it's a class project, now masked by a lot of rhetoric about individual freedom, liberty, personal
responsibility, privatisation and the free market. That rhetoric was a means towards the restoration and consolidation of
class power, and that neoliberal project has been fairly successful.
Formulating an alternative to neoliberalisation, then, must start by penetrating its form of appearance in terms of ideology
and policy choices. As valuable as critiques like Quiggin's are, the solution is not an alternative repertoire of economic
levers but a focus on the class nature of neoliberalisation. Such an approach implies the development of an alternative class
project, a hegemonic practice from below.
Thanks to
Gareth Dale
for keeping me excited about zombie metaphors and for pointing me to the paper by Peck et al.
The contradictions of "national" and "international" now defines the "post neoliberalism" epoch that started in 2008.
This article was written before the author understood the dangers' of neoliberalism. Has mostly historical interest.
Notable quotes:
"... Just as bringing stability to the American economy in the last century required stronger national institutions, bringing social balance to the global economy in this century will require stronger global political institutions to regulate global markets. Already, many such institutions exist–such as the World Bank, World Trade Organization (WTO), and International Monetary Fund (IMF). But in make-up and in culture, they are dominated by those who own and manage large concentrations of internationally mobile capital, whose goal is to escape market regulation and break free of obligations to stakeholders other than the global corporate investor. In the politics of the global market, these institutions are dominated by a single party: Call it the Party of Davos, after the Swiss resort where several thousand global corporate CEOs, government leaders, and their assorted clientele of journalists, academics, and an occasional nongovernmental organization (NGO) or trade union head have the equivalent of their party convention every winter. ..."
"... The politics of the New Deal and social democratic analogues across the world rested on a new understanding of how national economies worked. The British economist John Maynard Keynes and his American followers showed that in a modern economy the worker/consumer was as important an actor in the market drama as the investor/manager. The government therefore had an obligation to pump income into the economy during downturns to assure that workers continued to buy the products they had made. Although many of America's business elites resisted the egalitarian implications of the New Deal, the smartest of them understood that Franklin Roosevelt and Keynes had saved them from much worse, namely, Marx's prediction of inevitable class warfare. When Dwight Eisenhower's nominee for secretary of defense, Charlie Wilson, said, "What's good for General Motors is good for America," liberals snickered, but the country – and the United Auto Workers – thought he was right. By 1971, Richard Nixon could claim, with some justification, that "we are all Keynesians now." ..."
"... Keynes – whose ideas inspired the IMF and what eventually became the WTO – was no protectionist. Yet he cautioned nations to limit their foreign trade, because he believed it weakened a democratic government's ability to maintain the economic growth needed to keep social peace. ..."
"... if a large share of consumer demand went for imports, government deficit spending to overcome a recession would stimulate production in the exporting country rather than at home. And where growth depended heavily on exports, reducing wages to become more competitive would take priority over raising incomes to stimulate domestic consumption. ..."
"... As Renato Ruggiero, the first director-general of the WTO, observed, "We are no longer writing the rules of interaction among separate national economies. We are writing the constitution of a single global economy." ..."
"... A more accurate description of how the new world economy is governed comes from Anne-Marie Slaughter, dean of Princeton's Woodrow Wilson School of International Affairs, who in her book The New World Order describes informal networks of global bureaucrats and business-people that bypass traditional governments. ..."
"... "We are all the same–people who come and go through the [World] Bank, the [International Monetary] Fund, and Finance Ministries and Central Banks of Latin American countries. We all studied at the same universities; we all attend the same seminars, conferences " we all know each other very well. We keep in touch with each other on a daily basis. There are some differences, such as between those who studied at Harvard and those who studied at the University of Chicago, but these are minor things." ..."
"... The Party of Davos is no monolith. It has its factions, competing ambitions, and interests. And because the world's economies, while globalizing, are far from being completely globalized, important concentrations of economic power are still rooted in national economies. Corporations in China and Russia, for example, are constrained by a state apparatus that is decidedly nationalist. But it is only a matter of time before these national connections erode, too; meanwhile, the concentrations of private capital that have their roots in Europe, the Americas, and large parts of Asia have a shared agenda in weakening the power of national governments to restrict the freedom of capital in both rich and poor countries. As one prominent member of the Party of Davos blurted out at a conference at the Council of Foreign Relations, "When we negotiate economic agreements with these poorer countries, we are negotiating with people from the same class. That is, people whose interests are like ours. ..."
All markets have a politics, reflecting conflict among economic interests over the rules and policies that determine–as the American
political scientist Harold Lasswell once famously put it–"who gets what." And when markets expand, so do their politics. Thus, in
the nineteenth century, driven by improvements in transportation and communication technologies, commerce spilled across state borders
beyond the capacity of states to regulate them. The power of large corporations went unchecked, generating bitter and violent class
conflict. Fortunately, the democratic framework of the U.S. Constitution permitted popular challenges to the excessive concentration
of wealth and influence. Ultimately, through the Progressive and New Deal eras, the United States developed a national politics that
imposed a social contract–a New Deal that provided workers, as well as business, with enforceable economic rights. Over time, the
contract was extended to racial minorities, women, and others who had been previously excluded from expanding economic opportunities.
Today, markets have expanded again, beyond national borders–and beyond the capacity of the world's nation-based political institutions
to manage them. As a result, the global economy is sputtering. Witness the collapse of the Doha Round of trade negotiations, popular
hostility to the "Washington Consensus" of development in Latin America and other underdeveloped regions, and the spread of social
tensions over immigration and foreign-wage competition in both rich and poor countries. The current pattern of globalization is undercut-
ting the social contract that national governments, in developed and in many less-developed countries, had imposed over the last
century in order to stabilize their economies and protect their citizens from laissez-faire's brutal insecurities. Even as the world
grows more tightly knit, it still lacks a common politics for managing its integration.
Just as bringing stability to the American economy in the last century required stronger national institutions, bringing social
balance to the global economy in this century will require stronger global political institutions to regulate global markets. Already,
many such institutions exist–such as the World Bank, World Trade Organization (WTO), and International Monetary Fund (IMF). But in
make-up and in culture, they are dominated by those who own and manage large concentrations of internationally mobile capital, whose
goal is to escape market regulation and break free of obligations to stakeholders other than the global corporate investor. In the
politics of the global market, these institutions are dominated by a single party: Call it the Party of Davos, after the Swiss resort
where several thousand global corporate CEOs, government leaders, and their assorted clientele of journalists, academics, and an
occasional nongovernmental organization (NGO) or trade union head have the equivalent of their party convention every winter.
We are therefore faced with a catch-22: a global economy that is both prosperous and fair requires strong global institutions,
but given the lack of a constitutional framework for democracy on that scale, strengthening existing global institutions is unlikely
to generate a better distribution of global income and wealth. Indeed, under the present structure, as the world's markets become
more integrated, world inequality grows.
This fundamental contradiction cannot be resolved by unruly demonstrators at the entrance to the World Bank or the IMF. Nor will
it be resolved in polite public policy seminars with proposals for globalization's winners to share their gains with the losers;
that is not what winners voluntarily do. Serious reform will only come from the development of a cross-border politics that challenges
the cross-border power of the Party of Davos. Pulling together a worldwide movement is a utopian goal, but doing this in a region-by-region
process is not. In fact, American progressives could begin the process right here in North America by transforming the North American
Free Trade Agreement (NAFTA) into an instrument for continent-wide social progress. A redesigned NAFTA, in turn, could serve as a
critical building block in constructing a global economy that is more equitable, more stable, and more democratic.
The Politics of Expanding Markets
The politics of the New Deal and social democratic analogues across the world rested on a new understanding of how national economies
worked. The British economist John Maynard Keynes and his American followers showed that in a modern economy the worker/consumer
was as important an actor in the market drama as the investor/manager. The government therefore had an obligation to pump income
into the economy during downturns to assure that workers continued to buy the products they had made. Although many of America's business
elites resisted the egalitarian implications of the New Deal, the smartest of them understood that Franklin Roosevelt and Keynes
had saved them from much worse, namely, Marx's prediction of inevitable class warfare. When Dwight Eisenhower's nominee for secretary
of defense, Charlie Wilson, said, "What's good for General Motors is good for America," liberals snickered, but the country – and the
United Auto Workers – thought he was right. By 1971, Richard Nixon could claim, with some justification, that "we are all Keynesians
now."
Shortly afterward, the slow fusion of the U.S. economy with the rest
of the world accelerated. Between 1969 and 1979, the share of the U.S.
Gross Domestic Product (GDP) represented by foreign trade rose from 10
to almost 20 percent, and the trade balance shifted from a surplus to
deficit. By 2005, trade was 26 percent of our economy, and the
relentlessly rising trade deficit was at 6 per- cent of our GDP. Along
the way, the American industrial base–from apparel to steel to
high-technology products–has been dramatically eroded, wages have
stagnated, and the economic security of the typical American worker has
been systematically undercut. Economists will always debate the exact
numbers, and globalization is not the only factor driving the erosion
of American economic security, but by now few can doubt that it is a
major cause.
Keynes – whose ideas inspired the IMF and what eventually became the
WTO – was no protectionist. Yet he cautioned nations to limit their
foreign trade, because he believed it weakened a democratic
government's ability to maintain the economic growth needed to keep
social peace. For example, if a large share of consumer demand went for
imports, government deficit spending to overcome a recession would
stimulate production in the exporting country rather than at home. And
where growth depended heavily on exports, reducing wages to become more
competitive would take priority over raising incomes to stimulate
domestic consumption.
He was right to worry. Whatever else one might want to argue about
the last 25 years of globalization, there is little question that it
has undermined the New Deal–era social contract that rests on the
mutual dependence of workers and employers. As companies become global,
they increasingly find their workers and customers in other nations,
loosening the economic bonds of shared self-interest that previously
connected them with their fellow citizens. Indeed, for the last two
decades, CEOs of major "American" multinationals have openly
acknowledged that their future no longer depends on the prosperity of
their fellow nationals. In the 1980s, Carl Gerstacker, chairman of Dow
Chemical, said that he yearned to put his headquarters on an island
where it would be "beholden to no nation or society " rather than being
governed in prime by the laws of the United States." A decade later,
Alex Trotman, chairman of Ford Motor Company, observed bluntly: "Ford
isn't even an American company, strictly speaking. We're global. We're
investing all over the world " Our managers are multinational. We teach
them to think and act globally."
As American industry went global, the political lines over trade and
globalization began to be redrawn. In the past, workers and employers
in the same industry were, for example, on the same side on the
question of raising or lowering tariffs, depending on the industry's
competitiveness. After World War II, which had eliminated much of
America's industrial competition, both capital and labor became
champions of free trade. But as American companies began to transform
themselves into global corporations, free trade agreements have become
a way for them to shift production to places where labor was cheap. The
1993 debate over NAFTA, the first major political battle of the new
global economy, reflected this new division: American workers on one
side, investors and executives on the other.
A similar division over NAFTA occurred in Mexico and Canada, whose
working classes also anticipated the loss of bargaining power. Their
fears were justified. A decade later, in all three nations, the gap
between what workers produced and what they were paid grew
dramatically. In the United States, labor productivity in manufacturing
rose 80 percent, while real wages rose only 6 percent. In Mexico,
productivity rose 68 percent, while real wages rose 2 percent. In
Canada, the numbers are 34 and 3 percent, respectively. As Jorge
Casta"eda, former foreign minister of Mexico, observed at the time,
NAFTA was "an agreement for the rich and powerful in the United States,
Mexico, and Canada, an agreement effectively excluding ordinary people
in all three societies." It is not surprising that the rich and
powerful in all three nations gained most of the benefits while the
"ordinary people" paid most of the costs. The relentless tide of
Mexicans desperately crossing the border for work–a dozen years after
NAFTA's promoters predicted substantially reduced illegal
immigration–is just one sign of the agreement's failure to deliver on
its promises.
The fallout from NAFTA echoes the current pattern of globalization
generally. As capital becomes both more internationally mobile and more
protected, its bargaining power over domestic labor is strengthened.
Offshore outsourcing expands, and the threat to outsource becomes more
credible, forcing workers to agree to work for less and local
governments to weaken regulation. The result is rising global
inequality of income and wealth–and the inequality in political power
that follows.
The Garbled Language of Globalization
As globalization relentlessly reorders American
economic and political life, the policy debate remains mired in an
obsolete paradigm that clouds our under - standing of what is happening.
On the one hand, pundits like the New York Times' Thomas Friedman tell
us that the global economy has obliterated borders, making government
irrelevant. On the other hand, the discussion of policy remains trapped
in the language that defines globalization as competition among
sovereign Westphalian nation-states, in which the conflicting interest
of domestic politics stops at the water's edge. Thus, for example,
politicians and journalists speak of economic competition between
"China" and "America" as national rivalries. Yet the business news
channels are replete with celebratory segments on the profitable
integration of U.S. and Chinese firms. Indeed, the "China threat" is
actually a business partnership between local commissars who provide
the cheap labor and American and other transnational capitalists who
provide the technology and financing. Similarly, while analysts frame
the discussion of world poverty in terms of rich and poor countries,
they ignore the reality that there are poor people in rich countries
and rich people in poor countries, leading to foreign-aid programs that
are merely an inefficient transfer of resources from the former to the
latter.
Most confusing and damaging to the debate is the wide use of "free
trade" as a synonym for globalization. Leaving aside the theoretical
issues, simple liberalized trade among sovereign nations does not
describe how the world's economy is evolving. The process is rather
global economic integration, which aims at imposing a universal set of
rules and policies on all nations. As Renato Ruggiero, the first
director-general of the WTO, observed, "We are no longer writing the
rules of interaction among separate national economies. We are writing
the constitution of a single global economy."
That an integrated global economy should be regulated by universal
rules is obvious. The problem is that the "constitution"–which includes
the policies of the international financial agencies as well as
so-called trade agreements–protects and supports just one category of
citizen, the global corporate investor. The interests of other
stakeholders–workers, communities, civil society, and others whose
hard-fought rights were finally established in democratic national
societies–have been excluded. Even among sophisticated policy
intellectuals, the political implications of economic integration are
ignored by stuffing them safely back into the nation-state, whose
citizens are assumed to have suffered no loss of power. One of many
examples is economist Jagdish Bhagwati, a prominent proponent of
global laissez-faire economics, who writes that "moral suasion,"
"democratic politics," and "judicial activism" at the national level
are sufficient safeguards for labor, human rights, and environmental
protections. Although goods and capital are acknowledged to flow and
commingle in borderless markets, the class conflicts that markets
inevitably generate are not. Yet these are global political conflicts
that befit a global economy. By confining them to the nation-state box,
the popular cross-border politics needed to countervail the
cross-border power of private wealth is suppressed.
Thus a disconnect emerges between the theoretical notion of
"national interest" and its actual promotion on the international
stage. The conventional wisdom implicitly assumes that while tactics
and style may differ according to which party is in power, a nation's
representatives to the IMF or the WTO are assumed to be furthering the
"national interest," a phrase frequently referenced but rarely
specified. One of the few foreign policy commentators to address, even
in passing, the question of how to define the national interest is
Harvard's Joseph Nye, Jr. As he wrote in The Paradox of American Power,
"In a democracy, the national interest is simply what citizens, after
proper deliberation, say it is " If the American people think that
our long-term shared interests include certain values and their
promotion abroad, then they become part of the national interest.
Leaders and experts may point out the costs of indulging certain
values, but if an informed public disagrees, experts cannot deny the
legitimacy of their opinion."
The description of U.S. foreign policy being driven by the
citizenry, with leaders and experts passively "pointing out the costs,"
would be suspect under any circumstance. The Iraq war, to cite one
obvious example, was hardly initiated by a spontaneous grass-roots
movement in America demanding Saddam Hussein's head. But in the context
of the global economy, where cosmopolitan elites have more in common
with peers in other countries than they do with people who simply share
their nationality, it is stunningly na've.
A more accurate description of how the new world economy is governed
comes from Anne-Marie Slaughter, dean of Princeton's Woodrow Wilson
School of International Affairs, who in her book The New World Order
describes informal networks of global bureaucrats and business-people
that bypass traditional governments. According to Slaughter, this
"disaggregated" state has the speed and flexibility to "perform many of
the functions of a world government -- legislation, administration, and
adjudication -- without the form." The most advanced part of this virtual
state is the networks of people who run, manage, and regulate
international finance. Political scientist Judith Teichman, a less
enthusiastic analyst of cross-border networks, quotes a senior IMF
official who manages its Western Hemisphere portfolio: "We are all the
same–people who come and go through the [World] Bank, the
[International Monetary] Fund, and Finance Ministries and Central Banks
of Latin American countries. We all studied at the same universities;
we all attend the same seminars, conferences " we all know each other
very well. We keep in touch with each other on a daily basis. There are
some differences, such as between those who studied at Harvard and
those who studied at the University of Chicago, but these are minor
things."
Slaughter, for her part, believes these networks bring
accountability back to the people. "We need more [global] government,"
she writes, "but we don't want the centralization of decision-making
and the coercive authority so far from the people actually to be
governed." But, far from solving the globalization paradox, Slaughter's
networks are likely to transfer more power from ordinary people to the
hands of international technocrats whose career paths, like those of
their domestic counterparts, depend on those with financial–and
therefore political–influence. The WTO, one of its officials told the
Financial Times in a moment of candor, "is the place where governments
collude in private against their domestic pressure groups." The comment
reveals both contempt for democracy and disingenuousness about
political influence. In fact, the WTO's work is suffused with the
interests of domestic pressure groups with global business interests.
Corporate representatives dominate its many advisory committees and
working groups; its dispute settlement panels are chosen from pools of
experts who regularly work for transnational corporations; and business
even directly pays for the organization's expenses. In the last WTO
ministerial meeting held in America–scene of the famous "Battle of
Seattle" in 1999–business corporations, for instance, paid $250,000
each for special access to the trade ministers. The Office of the U.S.
Trade Representative is a well known revolving door of lawyers and
trade specialists (such as former Trade Representative Robert Zoellick,
now working at Goldman Sachs) whose next move is often to those
transnational corporate sector, where success comes to those who "think
and act globally"–and do so on behalf of those who are benefiting from
this global system.
The Party of Davos is no monolith. It has its factions, competing
ambitions, and interests. And because the world's economies, while
globalizing, are far from being completely globalized, important
concentrations of economic power are still rooted in national
economies. Corporations in China and Russia, for example, are constrained by a state apparatus that is decidedly nationalist. But
it is
only a matter of time before these national connections erode, too;
meanwhile, the concentrations of private capital that have their roots
in Europe, the Americas, and large parts of Asia have a shared agenda
in weakening the power of national governments to restrict the freedom
of capital in both rich and poor countries. As one prominent member of
the Party of Davos blurted out at a conference at the Council of
Foreign Relations, "When we negotiate economic agreements with these
poorer countries, we are negotiating with people from the same class.
That is, people whose interests are like ours."
There is no countervailing force at the level of global governance
to balance the Party of Davos's power. The International Labor
Organization (ILO), which is often erroneously thought of as the
worker's equivalent of the WTO or the IMF, is really a tripartite
structure in which labor, government, and business have equal voting
strength. More importantly, unlike the IMF, which has money, and the
WTO, which has trade sanctions, the ILO has no leverage over any nation
or company. A global capitalist class, of course, implies a global
working class. In response to the Party of Davos, international
cooperation among trade unionists on issues of collective bargaining
and organizing in specific industries is growing. But, by and large,
unions are too involved in fighting for survival in their national
economies to mount a global challenge to corporate power. And what
might be called (after the Brazilian city where it holds a
counter-Davos summit) the "Party of Porto Alegre"–the loose network of
dissenters and protestors that the media calls the "anti-globalization
forces," seen protesting at IMF meetings–is much more bark than bite.
It is too diverse, disorganized, and disdainful of power to get much
beyond demonstrations that make the nightly news but little else.
Next Steps for NAFTA
How then to reshape the politics–and power
relationships–of the global economy? A social contract did not come to
an expanded American economy until American workers became conscious of
their common interests. Similarly, one will come to the global economy
only when working families see that in a global labor market, they have
more in common with working families in other countries than they do
with those on the other side of the bargaining table. Yet in a world of
6.5 billion people in almost 200 separate countries–representing wide
differences in culture, living standards, and political consciousness–the prospect of seeing, to use an old phrase, "workers of the
world unite" enough to humanize the relentlessly interconnecting
markets seems hopelessly utopian. But if we begin to think of
establishing a global social contract as a step-by-step process, in
which political solidarity is built first among neighboring societies,
region by region, rather than some grand, all-embracing design, there
may yet be light at the end of this dark global tunnel.
Unlike global elites, who have easy access to global culture but
little connection to their hometowns, ordinary citizens in countries in
the same region tend to have more in common with one another than they
do with people half a world away. Culture and language are closer, and
trading relations are usually the strongest and most sustainable. True,
wars historically have been fought mostly among neighbors, but the
European Union (EU) demonstrates that at least among the more advanced
societies, the future need not necessarily be prisoner of such a past.
Moreover, regional integration would seem to be a much more promising
path toward the inevitable trial-and-error involved in building
competent and accountable institutions to manage cross-border economic
integration. American states were, and to some extent still are,
"laboratories of democracy" for the national government. In the same
way, the process of creating regional institutions that match expanding
regional markets might well produce "laboratories" for the construction
of a social contract that might eventually stretch to the range of the
global economy.
For all its slowness and the pain of its "two steps forward, one
step backward" process, the effort to build a "Social Europe" to match
the expanded European market offers the best real-world example of the
development of a politics around a cross-border social contract among
historically splintered neighbors. The future shape of Europe is
contested political terrain, and the conflicts between workers and
bosses, regulators and deregulators, and Europeanists and nationalists
reflect the inevitably messy way in which democracy is addressing this
historic experiment. The fragile democracies of the Mercosur countries
in the southern cone of South America are beginning a similar project
of economic integration that, if it continues, will inevitably involve
some political integration as well. A germ of the same idea also lies
in the economic collaboration among Southeast Asian nations.
This brings us back to the question of North America. Although NAFTA
failed to deliver on its promises, it succeeded in integrating the
three economies to the point of no return. Too many economic channels
have been redirected north-south to reverse the course of economic
integration. Every day, along with commingling labor markets,
intracontinental connections in finance, marketing, and production are
being hardwired for a seamless North American economy. We may not like
NAFTA, but there is no reversing its course.
But that does not mean that it's sacrosanct. Even those who designed
NAFTA to accommodate their own interests understand that it is an
inadequate instrument with which to govern this new political economy.
Revising NAFTA is already a topic of conversation among North American
business and political elites: The U.S. Council on Foreign Relations,
the Mexican Council on Foreign Affairs, and the Canadian Council of
Chief Executives have set up an ongoing "Task Force" to map out the
next steps. Their 2005 report called for a commonly administered
military security perimeter, common energy policies, and a modest
investment fund for Mexico. And Mack McLarty, former Clinton chief of
staff and now partner with Henry Kissinger in a consulting firm, has
called for planning an oil-for-infrastructure deal with Mexico to be
ready for the next U.S. president. But, while these and similar
proposals contain some sensible ideas, the framework is the familiar
one–an expanded market to feed global corporate ambitions–and gets us
no closer to solving the catch-22 of unaccountable governance.
Instead, we need to transform NAFTA into a set of rules that
recognizes the common economic future that now connects all of the
people of the three nations. It would need to include, at a minimum, a
"bill of rights" for citizens of North America, enforceable in all
countries, that would reestablish rights for people at least as strong
as the extraordinary privileges NAFTA gives to corporate investors.
They would include guarantees of freedom of association and collective
bargaining across borders, as well as an independent judiciary and
public transparency in government dealings with the private sector. A
new NAFTA would have to be a continental grand bargain in which Canada
and the United States commit substantial long-term aid to Mexico in
order to nurture higher and sustainable economic growth, while Mexico
commits to policies (independent trade unions, minimum wages, equitable
taxes, assistance to its depressed farm sector) that assure wages in
all three nations rise with their productivity. To that end, it would
require a North American customs union in which foreign trade would be
managed in the service of the needs of all three countries for greater
industrial self-sufficiency, resource conservation, and increased
investment in health and education. Such a new vision for NAFTA would
more strongly unite the three nations in a single competitive bloc that
provides all of the citizens of North America, not just its corporate
interests, an investment in its success.
North America is, of course, not Europe. It is easy to make the case
that the political and economic conditions that motivated and nurtured
the EU are quite unique. But at its conception, it was also easy to
argue that the EU would be still born. Indeed, in at least some
dimensions, a unified North American economy is a more credible idea.
There are only three languages (counting Quebecois French) to deal
with. All are relatively new countries. For at least two centuries
people have been moving, marrying, and interconnecting culturally. The
one time the United States and Canada fought was in the War of 1812,
while the Mexican-American War ended in 1848.
When the twenty-first century began, polls showed Americans,
Canadians, and Mexicans possessed highly favorable opinions of one
another. Asked in a 2000 World Values Survey poll if they would be
willing to form a new single country if it meant having a higher
quality of life, majorities in each country said yes. In the aftermath
of September 11, Canadians and Mexicans expressed massive solidarity
with Americans (although the invasion of Iraq, which they
overwhelmingly opposed, has rekindled some latent anti-Americanism).
Many on the U.S. side, when they still supported the war, resented that
Mexico and Canada refused to send troops. Still, the sense that–like it
or not–the three societies share a common future comes through in a
report of polls taken between 2003 and 2005, which shows support for
North American economic integration in all three nations, even though
people in each thought that NAFTA had been a "loser" for their country.
Moreover, gathering economic forces might actually force an
acceleration toward integration. At some point, the unsustainable rise
in the U.S. trade deficit will have to be reversed, threatening the
economies of Canada and Mexico, whose growth since NAFTA has depended
on the U.S. market. In order to avoid the political consequences (e.g.,
more illegal immigration from Mexico, less cooperation on national
security from Canada), the United States may well be forced to
establish a North American trading bloc anyway that protects its
neighbors' access to a U.S. economy that will be forced to reduce its
overall imports.
One thing is certain. The global economy will continue to undermine
both democracy and economic security until we develop the institutions
to support a social contract across borders. To do that, what better
place to start than in our own continental backyard?
The Last but not LeastTechnology is dominated by
two types of people: those who understand what they do not manage and those who manage what they do not understand ~Archibald Putt.
Ph.D
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