Wednesday, February 27, 2013

Italy's elections and the Five Star Movement

David Seaton's News Links
The "Grillini": this time the revolution won't be televised
The election that made Beppe Grillo, an anti-establishment blogger-comedian, leader of the largest parliamentary force in terms of votes cast was an election that passed a damning verdict on Italy’s corruption-infested political party system. The election that Europe hoped would reaffirm Italy’s commitment to the gruelling economic policies required to stabilise the eurozone was an election that, for the first time in the nation’s post-1945 history, produced a legislative majority disinclined to bow to Europe’s demands.(...) Corruption in politics, business and state administration feeds more poison into the system, clotting the arteries that might supply the blood of reform to the nation’s heart and brain. It was an election that exposed discontent with austerity but also illustrated that the road to economic salvation must pass through a decontamination and renovation of Italian politics. Financial Times
I wonder if the Italian political class (or Europe's or America's or the world's for that matter) have yet metabolized the message that Beppe Grillo's Five Star Movement has sent them.... Which in demotic Italian is simply "vaffanculo".
They had better.
The Grillini have received 25% of the vote without external financing or the backing of any communications group... just with Internet, Twitter and the street.... While the traditional pols were on TV, the Grillini filled the piazzas and the streets... This is called "populism" which seems to be a dirty word when pronounced by "serious" people, however this is not some illiterate rabble, in fact, they are to a great extent, young, college educated and female.
Some commentators are comparing Grillo to Mussolini, but one of the best things you can say about the 5 star movement is that except for moving the masses, it doesn't resemble Mussolini's fascisti at all. It is not racist, xenophobic or ultra-nationalist. But, this is the first serious challenge to the "democratic deficit" anywhere... Will it dissolve in "left wing infantalism" or will it succeed in changing democratic politics in the age of Internet? Stay tuned.
Americans who view the rise of the Five Star Movement either wistfully or fearfully can despair or take comfort in knowing that our political system was deliberately designed by men of property, many of them slave owners, to make it impossible for any similar outcome to ever occur in the United States. In this they were eminently successful.
The only direct descendents of Thomas Jefferson, who penned the lines, "All Men are Created Equal" are also the descendents of the slaves that he exploited sexually. The entire story of democracy in America is the sometimes bloody and always herculean effort to breathe some life into those lines of Jefferson's and also the bit about "government by the people, of the people and for the people".
Today's America, with its revolving door, extractive lobbies is easily as corrupt as today's Italy, but the chances of anyone in the United States ever giving the "good and the great" such a fright as Signor Grillo is giving their Italian counterparts is practically nil. DS

Thursday, February 14, 2013

Capitalism: is we is or is we aint?

David Seaton's News Links
Read carefully the two quotes below as if they were a Zen koan on the order of "what is the sound of one hand clapping?" or "does a dog have Buddha nature?", and see if you notice the cognitive dissonance they produce.
Consumer spending is not only the key to economic recovery in the short term; it’s also necessary for balanced growth in the long term. If our goal is to repair our damaged economy, we should bank on consumer culture — and that entails a redistribution of income away from profits toward wages, enabled by tax policy and enforced by government spending. James Livingston - New York Times

"For capitalism is abolished root and branch by the bare assumption that it is personal consumption and not enrichment that works as the compelling motive."
Karl Marx - Das Kapital - Vol. II, Ch. IV, p. 123
Meditating on the above, first, on the the need for carefree consumer spending in order to avoid an even deeper recession, and then on the essential capitalist virtues of thrift and capital accumulation, sound fiscal policies and solid currency, I began to get some understanding of where we are and the dangers we may be facing.
We are being urged to drastic cost cutting and thin-lipped austerity in order to manifest the capitalist virtues of thrift and the sacrifice of immediate gratification, with a view to accumulation, which when manifested will paradoxically lead to even greater economic hardship, certainly in the short term... and as Maynard Keynes said, "in the long run, we are all dead".
For some reason, known only to my neurons, the following simile occurred to me:
In cities such as Beirut and Cairo, a sophisticated middle class lives in a liberated, western style in the midst of a deeply conservative, Arab society, where all men, Christian and Muslim alike expect to marry virgins. In consequence, the best plastic surgeons in Europe are charging rich, young, Arab women high fees to perform Hymenorrhaphy or hymenoplasty, the surgical restoration of the hymen. This relatively simple operation is perfectly safe when performed by a skilled professional under hygienic conditions, and is, of course, performed with the patient under anesthetic.
What conservative economists are asking western consumers, the motor of the world's economies, to do right now, is to restore our capitalist "virginity"... but instead of being in the hands of competent surgeons, we are being asked to undergo surgery performed with dull knives by incompetent, butcher-quacks, with dirty hands (politicians etc)... and without anesthetic.
Once this ordeal has been undergone and our "virtue" restored, it is hoped that we, thus painfully re-cherry-ed, will soon return to our former libidinous lubricity.
The question would be: is this trip really necessary?
For many years, people have been getting jobs, owning a home, getting an education, paying their medical bills, all because of easy credit. Now, it seems to me, that having a job, owning a home, getting an education, paying medical bills, are basic human needs that almost all human beings rightfully aspire to, and rightfully demand. The system provided all those things, therefore the system was considered "good".
Now the credit has been shut off and humans no longer can get a job, own a home, get an education and pay the doctor, therefore the system is "no good" and should be changed so that people can return to owning a home, getting an education and paying the doctor.
But what was our system really? "Personal consumption" and not "enrichment" was the compelling motive that moved the economy, and that according to Karl Marx, who knew a thing or two about it, is not capitalism.
As the quote from Marx at the top of the post indicates, our economy had long ceased to be classic capitalism and had become, what for want of a better word, I would call "consumer socialism". The state printed money and practically gave it away at absurdly low interest and every obstacle to lending it, such as credit worthiness, was removed and people had jobs, owned homes, got an education and paid the doctor.
If we really are going "tighten our belts", there is a very real chance of our entering into a full blown depression similar to the 1930s and we would be well advised to remind ourselves that only two countries avoided the Great Depression of the 1930s, to wit, Hitler's Germany and Stalin's Russia and the United States only climbed out of the depression by entering World War Two and creating a command and control economy with unlimited public debt, severe price controls etc. Thus, during the war the American economy came to resemble those of Nazi Germany and the Soviet Union and after the Second World War, the Cold War soon began, which established the Military-Industrial Complex as a continuation of America's sui generis wartime "corporate state", which was the beginning of America's legendary prosperity.
So now, at the this late date, we are expected to apply classic, capitalist "fundamentals", when history shows us the result? DS

Sunday, February 10, 2013

Droned if we do, etc

David Seaton's News Links
It’s insane how vulnerable we’ve made ourselves, like drunks failing to look around as they walk into traffic. Hackers could shut down the way we live, and if they hacked into drones or nuclear codes, determine the way we die. If you think it through, which most of us avoid, the prospect of Techmaggedon is terrifying. On Thursday, at John Brennan’s confirmation hearing to be C.I.A. director, some senators took a stab at thinking it through on the smart, sleek, robotic machine that dominates our political debate. (Drones, not Obama.) Maureen Dowd - New York Times
What a can of worms! Drone killings are one of those, "it seemed like such a good idea at the time", deals that comes back to haunt the people that dream them up.... like getting the Saudis to finance the war against the USSR in Afghanistan, for example.
Parking all moral considerations and constitutional guarantees for a minute, another major downside is that the technology involved isn't rocket science.... radio controlled airplanes and helicopters are even on sale in toy stores in developed countries.
Stop and think how easy it would be to use a toy helicopter, with an incendiary grenade attached to it, in as "target rich" an environment as the Isle of Manhattan. Then just think how disruptive it would be for normal life there if they had to jam all the junk-band radio frequencies used to operate RC models (and so many other devices) in order to prevent such an attack.
For a country as potentially vulnerable as the USA to use this technology as a primary weapon system is like telling children not to put beans up their noses: it is putting ideas in the heads of people without much technology or money to spend.
It is really time for a wide ranging discussion about how we got here and how to go in another direction, as difficult as that might be.
What bothers me a lot too, is that Obama is doing all this. With Bush, what you saw was what you got... But Obama is so opaque, so ambiguous, so mysterious... After four whole years I still don't feel I know who he is... Better than Romney would have been for sure, but having said that... What a can of worms! DS

Wednesday, February 06, 2013

What might a revolution look like?

David Seaton's News Links
I finished up my last post saying:
(...) simply by nationalizing Monsanto and Walmart we would have a perfect, planned economy… in other words we are all dressed up and waiting for Lenin.
And several people have since asked me what I meant by that.

It comes in two parts the "planned economy" part and the "Lenin" part.

I use the word "Lenin" very loosely, what I mean by it is a signifier for someone or more probably something, which changes everything. Used like this digital photography played "Lenin" to Kodak's Romanov. More about this later.

The idea of a nationalized Walmart being a “planned economy” is based on the idea that the new technologies, which the soviets never mastered, would make it possible.

The idea simply assumes that Russians are bumbling incompetents and that with “American know how” making it tick, and with the American genius for logistics once applied to it, the whole thing would work smoothly. The centralization is already there, the question is only of ownership, not execution.
One of the great paradoxes in all this is that who actually owns the great corporations of today is not very clear. For example a man named J.P. Morgan no longer owns JP Morgan, it is a publicly traded company and no one institution or individual owns more than 4.00% of this financial mastodon. More on this ownership question later.

Actually what it appears we have now is a sort of socialism of the rich. Losses are socialized and profits are privatized. We have a great centralization of economic power of unclear ownership tied by lobbies to political power enabling the corporate managers to craft laws to the benefit of all concerned: lobbyists, their clients and the politicians, but not to the benefit of the public (sanitized name for “The People”). If we look at the control that is accumulated in this system we see that we already have a “planned economy”, but not exactly planned for our benefit. There is even a "nomenklatura" of the previously mentioned, highly paid managers, who run everything, and often move from corporation to corporation and even from industry to industry or from public "service" to the "private" sector.

The idea, for the moment, merely amusing, is that by the state simply taking control of a few corporations, as might happen during a war, they would instantly possess a "ready to wear", planned, socialized (if not socialist) economy.

Where is the "Lenin" for all of this? Could there be a "revolution"?

Understand that for a steak on a grill being turned over to be cooked on its other side constitutes a revolution. In that sense yes, Virginia, revolution is possible... more on that later.

An American Pol-Pot leading the masses to take Capital Hill and liquidating the enemies of progress? Not very likely. In the case of the United States, because of its enormous size, ethnic diversity and institutional solidity (petrification?) I think that capitalism will just have to take its own sweet time to rot.

At bottom, Americans are practical people and if something doesn’t work, they either fix it or throw it out and get something new, preferably the second option.
I think that if the capitalist era is ever to end it will happen in the USA, because America is the vanguard of capitalism, its most complete expression. And I don’t see it happening violently, but in the same way Americans passed from horses to Model-T Fords, from Wang word processors to PCs and from cassette players to Walkmen to Iphones. America is just one revolution after another, if you think about it... and plus ça change, plus c'est la même chose. Revolution is part and parcel of the American way of life.

Americans are really famous all over the world for being practical and innovative and when and if the system spins off its wheels as old Karl predicted, I think that those qualities would surely come to the fore. But given how well the system is vertebrated, it would be traumatic or it wouldn't be.

What could cause our present system to spin off its wheels and self-destruct?
Thinking it over, I imagine if would have to be some sort of "black swan". A lot of people think immediately of a terrorist attack like a dirty bomb in New York, but I think that if something like that happened, God forbid, it would tend to solidify and petrify the system even further.

No, the easiest "revolutionary" black swan that I can imagine is a great worldwide pandemic like the "Spanish Influenza" at the end of World War One or even on the scale of the 14th century, "Black Death", which killed from 30 to 60 percent of Europe's population. With globalization and its disappearance of time and distance and the ensuing promiscuity of the sophisticated with the primitive, such a plague is perfectly possible and many experts think its arrival is only a matter of time.

Something like this would be terrible anywhere, but in countries with more ethnic and social homogeneity and simpler and easier logistics, less distance and less logistical and monopolistic agricultural centralization than the USA, the effects might not change the relations of the societies as profoundly as I think they might change America's.

We have talked about centralization, Walmart, corporate ownership and the nomenklatura. Let us look at what effect our black swan of a pandemic might have on the relation of these elements to each other.

Very few Americans eat food grown anywhere near them, it may come from almost anywhere in the world at the end of a wonderfully efficient and complex logistical system that depends in turn on enormous and usually remote farms owned by great corporations known as "agribusinesses" that depend in their turn on sophisticated machinery and techniques to produce masses of specialized produce. Imagine how a pandemic with 14th century death rates would disrupt all of that: beginning on the farm, then to the transport system, but most significantly to the nerve centers of corporate headquarters, concentrations of human beings that wise survivors among the nomenklatura would want to avoid like... the plague.

Once the local Walmart had been looted, what would people eat? Obviously what remained of the government and armed forces would have to take all these systems in hand. MBAs might be drafted and forced to unlock the inventories and discover where food was stored and find ways of getting that and medicine to the survivors and to help them bury their dead. And as Katrina and Sandy have shown us, today's America doesn't do disasters particularly well, but such a struggle as I am imagining would call forth a solidarity which I am sure the survivors would look back on with nostalgia the rest of their days.
As we have seen the ownership of this very centralized system is spread out to the point of being gaseous and a dying off of the proportions I am talking of would make finding out who owned/owns what next to impossible, so when the pandemic remitted re-privatizing this orphaned, centralized system of uncertain parentage, might be impossible... think of all the dead lawyers.

So that is how I see a possible "revolution": the massive disruption of a highly centralized system of decentralized ownership leading to its nationalization in a climate of solidarity among survivors. DS