Wednesday, December 31, 2014

2015 - I can't breathe... Can you?

My clearest reading of 2014's tea leaves is "instability": worldwide instability and in my opinion this instability has its origins at the heart of the most developed economies of the western world. The causes? We are undergoing a technological revolution and process of globalized outsourcing, combined with a reduction of the welfare state that is severely degrading the middle class in developed countries and converting them slowly, but surely into working-poor. Anyone who has read a bit of history could tell you how dangerous that is.
I will stand on that this year too and I think things are going to get worse, perhaps much, much worse. The Reuters year end wrap gives a rather useful shopping lists of potential disasters.
"Normally after a year like this you might expect things to calm down," said John Bassett, former senior official with British signals intelligence agency GCHQ now an associate at Oxford University. "But none of these problems have been resolved and the drivers of them are not going away." The causes are varied - a global shift of economic power from the West, new technologies, regional rivalries and anger over rising wealth gaps. Reuters
I would add to that the possibility of an airborne pandemic, a sort of sneezing "Ebola", which is going to happen sooner or later in today's interconnected world... or (much more likely if the US-EU pressure doesn't let up) some very, very nasty surprise from Russia, because as Dimitri Orlov says,  "The Russians don't threaten, they act".

But as I stressed a year ago, at the heart of everything is the ongoing collapse of the middle class in the most highly developed countries. This is something that is destabilizing precisely those countries whose role has always been to stabilize the rest. That is the multiplier of all the other instabilities.

Here is a comment from a conservative commentator.
The great middle-class fear today is that the connection between personal aspirations and societal opportunities is breaking down.(...) The middle class is thinning. Belonging is a matter of self-identity, and fewer Americans buy into its defining presumptions. Robert Samuelson - Washington Post
After you read something like that, from someone like that, news about the militarization of urban American police forces begins to look like the "good and the great" are getting ready for some serious, social unrest on the order of "urban warfare".
During the Obama administration, according to Pentagon data, police departments have received tens of thousands of machine guns; nearly 200,000 ammunition magazines; thousands of pieces of camouflage and night-vision equipment; and hundreds of silencers, armored cars and aircraft. New York Times
The federal government shipped nearly 4,000 more assault rifles to local law enforcement agencies in the three months following the Ferguson riots, marking a huge surge in the amount of lethal firearms being doled out to police and sheriff’s offices.(...) The Los Angeles School Police Department decided it didn’t need grenade launchers, but did figure it should keep the M-16 rifles and the armored vehicle it had previously received. Washington Times
Eric Garner, a harmless man, who was strangled to death by a brutal police officer, has given me a simple answer to a question that other Americans have often asked me over the years, "why do you live abroad?". 

When people ask me why, being American, I don't like living in the USA, I usually find myself launching into some cumbersome, wordy-nerdy explanation, filled with dangling clauses and so forth... but now poor Mr. Garner has given me a three word answer that says it all... When I'm in the USA (or even think about being in the USA) I can't breathe. DS

Sunday, December 21, 2014

The Sony hack... (warning: pure speculation to follow)

The FBI said technical analysis of malware used in the Sony attack found links to malware that "North Korean actors" had developed and found a "significant overlap" with "other malicious cyber activity" previously linked to Pyongyang. Reuters
It's obvious that North Korea is behind the attack on Sony in retaliation for making "The Interview"...

In fact it is so obvious that it makes me suspicious.

The North Koreans say they didn't do it... I believe them.
Much of North Korea’s hacking is done from China. And while the attack on Sony used some commonly available cybertools, one intelligence official said, “this was of a sophistication that a year ago we would have said was beyond the North’s capabilities.” Fareed Zakaria - Washington Post
I think they have been set up for the fall by a much more sophisticated attacker, one who doesn't want to take "credit" for the attack. There are two prime suspects in that case: China and Russia.  In my opinion it was the Russians. Here is a recent report of their work:
Russian state-backed cyber spies are behind coordinated, sophisticated digital attacks in the past two years against sensitive political and military targets, including Nato, the EU and government ministries, according to a security analyst. “Up until now the focus has been on China – but Russia is really the far more advanced player. Russia has been more effective at integrating cyber espionage into a geopolitical grand strategic campaign – not just a military one, but economic and political. They are more tactical too. More targeted in the institutions they go after . . . and more accomplished.” Financial Times - October 28, 2014
For me the Sony hack shows a very deep knowledge of the American economic and social system's weak points, where the celebrity culture intersects with the insurance/financial/complex and the communication infrastructure that supports it... and the rest of corporate America. I believe the Russians accumulated this kind of "reverse-Kremlinology" during the decades of the Cold War and that neither the Chinese or especially the North Koreans, would know how to touch so many of America's raw nerves simultaneously.
Why would the Russians pin it on the North Koreans?

They would for the same reason that Sony made the film: the North Koreans are comic book villains that are seen as crazy enough to do anything and it's precisely the the craziness that has made this incident so viral, where the comments about Angelina Jolie's possible insanity take precedence over the plus $90,000,000 that Sony stands to lose by pulling the film or the uncountable, confidential, corporate information, now in hostile hands. Russia certainly wouldn't want to provoke a hostile confrontation with the United States over something so "comic bookish", but the "comic bookishness" is an essential part of the incident's power. An attack on JP Morgan is probably much more serious than the Sony hack, but that would never grab the public's attention in the same way.

That leads us directly to the following questions:

What has the attack achieved? What would Russia have to gain by this attack?

The answer to the first question is the answer to the second.

The Sony hack has shown the fragility of America's complex system in a way that even the least technical person can understand it and because of the celebrity gossip involved the entire country, ladies and gentlemen and children of all ages have seen it and talked about it.
And what if the next target for the cyber attackers is not a film corporation but an electricity grid, or gas suppliers, or water pumping stations? Then what? Call this a comedy? I'm not sure there is much to laugh about. BBC
Russia is at this moment under tremendous pressure from the "West"; it would even appear that the Obama administration is bent on "regime change" in Moscow. The logic of the Russians acting under the cover of the wackos of Pyongyang would be the following: in the light of the Sony hack and seeing the damage that puny North Korea could do to a major corporation, the "good and the great", the "serious" people in corporate America might pause to ask themselves: if Kim Jong-un could cause such havoc, what might Vladimir Putin be able to do, it sufficiently backed into a corner? DS

Tuesday, December 02, 2014

Is Revolution Necessary... Is it Possible?

A June 2013 Gallup poll revealed that 70% of Americans hate their jobs or have “checked out” of them. Life may or may not suck any more than it did a generation ago, but our belief in “progress” has increased expectations that life should be more satisfying, resulting in mass disappointment. For many of us, society has become increasingly alienating, isolating and insane, and earning a buck means more degrees, compliance, ass-kissing, shit-eating, and inauthenticity. So, we want to rebel. However, many of us feel hopeless about the possibility of either our own escape from societal oppression or that political activism can create societal change. So, many of us, especially young Americans, rebel by what is commonly called mental illness. Salon

If it was conventional wisdom that a bunch of unelected bankers looking out for rich people were the reason everyone was out of work, politicians would be forced to explain to angry voters why we had this crazy system and might actually consider doing something about it.
The late Aaron Swartz


Revolution against what?


"Capitalism" like "Communism" is a word so overused, that like "awesome", it has become nearly meaningless. Let us instead just refer to our "Present, Global, Economic System" (PGES).
There is no other system, so for want of anything better, "PGES" will do just fine. It is morphing constantly so some "one size fits all" can morph with it.

Which bring us to the question, does life really, "suck any more than it did a generation ago"?

I would say, "yes", it does, wouldn't you?


Because we are being "optimized" by the new technologies beyond the dreams of the pioneers of PGES.

What is "optimization"?

Ask any battery chicken or your average pig... it's true they can't talk, but they are experts on the subject of optimization.

Seriously, since Frederick Taylor, invented "Scientific Management", managers have found more and more ingenious ways of optimizing the work force so that it produces as efficiently as the battery chickens lay eggs, but with computers their ability to do this has grown geometrically. To make it more onerous those who hold the levers that control this system give the impression that they no longer even breathe the same air as the rest of humanity.

To be brief, let us say that at this point in time we find ourselves writhing helplessly in the hands of an itinerant, universal, cosmopolitan, extractive, managerial oligarchy of no fixed abode, totally out of the control of any democratically elected institution, with no clear accountability for, or title to, the unimaginable wealth that passes through, and more often than not, sticks to their hands.

What has happened to a system that was always callous, but which didn't seem so insanely "out of control"?

Under the title, "Have US Corporations Renounced Citizenship?", which I recommend reading in full, William Pfaff gives a very serviceable explanation of many of the factors.  Among other things Pfaff writes:
Part of the reason for the dramatic change that has taken place in American business opinion obviously is globalization of business and production. A second is the onset of globalization-induced opportunities for tax minimization or sheer tax evasion. A third, as I have noted before, is the shift of corporate control from owners, now frequently powerless, even collectively, to opportunistic professional management. The most important reason, however -- in my opinion – has been the profound change that has taken place in economic ideology. Both monetarism and market theory remove from economic management voluntarism, political intelligence, and moral responsibility, by describing economic function as objective and automatic. Thus the customer always makes the most advantageous choice, so the market presents a perfect and efficient mechanism dictating the choices that must be made by businesses, while always tending towards perfect competition. Labor is a mere commodity, and unions and wage demands obstacles to the free function of markets. Governments by nature are obstacles to economic freedom. William Pfaff
To bring this down to the ground, where the rubber meets the road, where it connects with everyday life, I thought that this quote from an article from Time that I used to illustrate a piece on the fast food workers strike, would better give the rank flavor of the economic ideology that Pfaff analyzes.
A living wage would have more long-lasting effects on the industry than just the price of its menu items. Lichtenstein says it would likely create permanent employment in the industry, meaning more of its workers would stay for two to three years, likely leading to further demands on working conditions. “From the company’s point of view, if they know their employees are going to be there for three years, then there’s also this informal pressure on the managers to accommodate the workers,” he says, citing the possibility of wage creep and further increased labor costs for employers. “Managers then can’t just move people around all the time. Firing gets more difficult. So they don’t want a permanent workforce.” Time Magazine
The classic late 19th early 20th century image of work

Charlie Chaplin's "Modern Times"

This is how work looked by the 1950s

Jack Lemmon's office in "The Apartment"

A big office might still look quite similar today, but the difference would be that one computer might be handling much more data than the entire office of the '50s did... multiply that by the workstations you see in the picture and you'll get an idea of the pressure created.

We should ask ourselves:

Do our societal institutions promote:
  • Enthusiasm—or passivity?
  • Respectful personal relationships—or manipulative impersonal ones?
  • Community, trust, and confidence—or isolation, fear and paranoia?
  • Empowerment—or helplessness?
  • Autonomy (self-direction)—or heteronomy (institutional-direction)?
  • Participatory democracy—or authoritarian hierarchies?
  • Diversity and stimulation—or homogeneity and boredom

Of course all of this is aggravated by ours being a consumer society, where capitalism's foundational virtues such as patient suffering in the present for a better future tomorrow, sacrifice and the postponement of gratification are anathema and if followed would be the final coup d´grace for the wounded economy... Just ask Angela Merkel. According to the canons of marketing, people are supposed to be happy, they "deserve" being happy, but at the same time they never should be satisfied. This construction is obviously insane, but at the same time we are constantly being told, "there is no alternative".

Summing up you could say that
Global capitalism is a complex process which affects different countries in different ways. What unites the protests, for all their multifariousness, is that they are all reactions against different facets of capitalist globalisation. The general tendency of today’s global capitalism is towards further expansion of the market, creeping enclosure of public space, reduction of public services (healthcare, education, culture), and increasingly authoritarian political power.  Slavoj Žižek - London Review of Books
The big question: who is ever going to bell the cat? DS