Wednesday, June 15, 2011

Humanity: up a tree, with no fireman in sight

Raghuram Rajan
“The ultimate reason for all real crises always remains the poverty and restricted consumption of the masses as opposed to the drive of capitalist production to develop the productive forces as though only the absolute consuming power of society constituted their limit.” [Marx - Capital, Volume III, Chapter 30]

“It is the end of cheap goods,” says Bruce Rockowitz. He is the chief executive of Li & Fung, a company that sources more clothes and common household products from Asia than perhaps any other.(...) China helped to keep global inflation in check. But that era is now over, (...) Nothing can replace the Chinese miracle. “There is no next,” says Mr Rockowitz. Prices will now start to rise by 5% or more each year, with no end in sight. And that may be optimistic. So far this year, Mr Rockowitz says, Li & Fung’s sourcing operation has seen price increases of 15% on average. Other sourcers of Asian toys, clothes and basic household products tell similarly ominous tales. Economist

“In the quest for growth, many countries have neglected to build a reliable system of social security that will help citizens buffer the market's volatility.(...) Democratic capitalism’s greatest problem is not that it will destroy itself economically, as Marx would have it — but that it may lose its political support.” Raghuram Rajan
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Marx's predictions of the system collapsing under the "enmiseration" of workers seem to have been foiled over and over again by the system's growing ability to produce and market ever cheaper and more abundant consumer goods and then, when incomes began to stagnate, to make available ever cheaper and more abundant credit with which to buy those goods: a form of consumption which used to be aptly known in England as "buying on the never-never". The role of the worker was replaced by the role of the consumer and the connection between the two roles became ever more tenuous.

Thus did the system square the circle: people could "own" their own home and consume just as if they were prosperous, despite stagnant or falling wages and to tide people over the rough spots, in most developed countries, there was a generous welfare state in place.  This formula for dynamic economies combined with social peace appears to be have run out of road. And in this financial crisis the "never" of never-never seems to have arrived.

In the video above, Chicago University professor and former (clairvoyant) chief economist of the IMF, Raguram Rajan lays great emphasis in improving education in order to prepare workers for a labor market demanding ever more sophisticated skills, as those without said skills, seem irredeemably doomed to Marx's "enmiseration". 

As much as I admire professor Rajan, and I admire him very much, I am skeptical about the possibility of training the mass of humanity, the grandchildren of homo habilis, in the skillful, rather obsessive, management of the abstract symbols and concepts which make up so much of the new technologies... This is a sort of skepticism I have been incubating for a long time. I remember even writing a poem when I was in my teens, with the lines:
On a rectangular plot of manicured grass,
Sits the man of tomorrow,
On yesterday's ass
My intuition tells me that we are quite a young species -- only about 200,000 years old -- and only living in permanent village-town-cities, that is to say, "civilized", for some 10,000 years. We belong to a species, which, by a quirk of evolution, is intelligent enough to have gotten itself into a situation which we are not intelligent enough to get out of... something like a kitten climbing a tree... Unfortunately, there doesn't seem to be a "fire department" to get us down from our "tree".

Let me give a simple, graphic, example of what I am trying to say. Look at today's epidemic of obesity, which I think is a perfect indicator of our dilemma. For almost all of our 200,000 years of existence as a species, right up till the very recent development of our advanced agricultural and distribution techniques, being able to gain weight quickly, when food was abundant, and lose it slowly, when food was scarce, was a vital plus for surviving frequent crop failures, droughts and other natural disasters. Suddenly, within a few generations, thanks to our logistics and food processing systems, a large percentage of the population finds itself waddling toward an early grave.  I think this will serve as metaphor for many observable phenomena today, you are welcome to make your own list.

Certainly most of humanity through most of its history and prehistory, survived and did useful work without having to manage abstract symbols and concepts and it seems to me as cruel as laughing at fat people  to make those abilities essential for living with any security and dignity today.

The challenge today is to allow the most average of people to have a decent life, with good health, as much education as they are able to absorb and a chance to work gainfully in occupations within their capacities and enjoy a dignified retirement. The person able to "re-invent" work, and make this possible would be the "Einstein" of today's world.  DS

1 comment:

Publius said...

David: If Prof. Rajan doesn't mention or talk about Peak Oil, he is deluded.
I agree with your analysis: it's even worse than that, though.
Even if the average salf-of-the-earth type could learn new technological skills, we still live on a finite planet.

Infinite growth on a finite planet is impossible, and our technological prowess has simply allowed the population overshoot to be even worse than it would otherwise be: worse than any other species has managed to overshoot.

The result of overshoot is well-known and obvious: die-off. This is a biological, ecological certainty, regardless of political ideologies, which become simply tools to figure out who to scapegoat.

The best we can do is try to organize our communities and families to survive and even thrive, in new ways that don't require economic growth and consumption, and hope we don't end up in an area that goes Mad Max, all-out-violent, die-off.

The weather weirdness going on in the USA already is of concern.

Nuclear plants will not survive the coming grid-wide blackouts.
Bleak... but we must make plans and organize.