Tuesday, January 22, 2008

A Better Country

We woke up this morning to that whooshing sound of money being lost. Most of the world's capitalists markets were selling yesterday while the markets in New York were closed for MLK Day. So yesterday, there was an emergency meeting of the Fed which reduced the interest rate by 3/4 s of a percent to 3.5 percent from 4.25 percent. It was the first such extraordinary action by Bernanke and the first since 911.

Last night at dinner when someone predicted that the market would drop today, I responded that "no, they will throw everything they have at it" to stop the momentum of the sell off. An overnight rate decrease may not be everything, but it is unprecedented. And even though the American markets opened with a precipice, they have recovered reasonably well through the day.

I remarked as we hopped out of bed how silly this all is. The system would have us believe that the problem is us. We don't spend enough. It's like telling a 400 pound man that the reason his heart is failing is because he doesn't eat enough. It's truly remarkable that we fall for it.

The problem with the economy is not the fear that consumers will stop hawking their homes to buy more Chinese goods and electronic doo dads. It is not the interest rates. It is not the way our banking system creates money and capital. (even though that's one of the least understood aspects of the system ).

No the problem is this. The whole system is based on growth. And, if it doesn't grow, it contracts, and when it contracts, all kinds of bad things happen. Good hard working people lose their jobs. Then they lose their houses, their savings, their sanity.

Nobody wants that to happen, so we spend spend spend to keep the economy healthy. All the while, we deplete our finite resources, and fill our biosphere with carbon with hardly a calculation to the ramifications of our actions.

I mentioned this morning, as we listened to NPR, that humankind is a very long way from realizing what a crock of crap it all is, that we are galaxies away from seeing not only how silly and cruel the current economic system has become, but how relatively easy it would be to fix it. I opined that most of us can't seem to imagine a Bucky Fuller world where the earth's resources provide quite well for us all.

I googled alternative economic system and basically got nothing. Then, I thought about Oscar Wilde and his writings. Here is a piece from his Soul of Man:

"Up to the present, man has been, to a certain extent, the slave of machinery, and there is something tragic in the fact that as soon as man had invented a machine to do his work he began to starve.

This, however, is, of course, the result of our property system and our system of competition. One man owns a machine which does the work of five hundred men. Five hundred men are, in consequence, thrown out of employment, and, having no work to do, become hungry and take to thieving.

The one man secures the produce of the machine and keeps it, and has five hundred times as much as he should have, and probably, which is of much more importance, a great deal more than he really wants. Were that machine the property of all, every one would benefit by it. It would be an immense advantage to the community.

All unintellectual labour, all monotonous, dull labour, all labour that deals with dreadful things, and involves unpleasant conditions, must be done by machinery. Machinery must work for us in coal mines, and do all sanitary services, and be the stoker of steamers, and clean the streets, and run messages on wet days, and do anything that is tedious or distressing.

At present machinery competes against man. Under proper conditions machinery will serve man.

There is no doubt at all that this is the future of machinery, and just as trees grow while the country gentleman is asleep, so while Humanity will be amusing itself, or enjoying cultivated leisure - which, and not labour, is the aim of man - or making beautiful things, or reading beautiful things, or simply contemplating the world with admiration and delight, machinery will be doing all the necessary and unpleasant work.

The fact is, that civilisation requires slaves. The Greeks were quite right there. Unless there are slaves to do the ugly, horrible, uninteresting work, culture and contemplation become almost impossible. Human slavery is wrong, insecure, and demoralising. On mechanical slavery, on the slavery of the machine, the future of the world depends.

And when scientific men are no longer called upon to go down to a depressing East End and distribute bad cocoa and worse blankets to starving people, they will have delightful leisure in which to devise wonderful and marvellous things for their own joy and the joy of everyone else.

There will be great storages of force for every city, and for every house if required, and this force man will convert into heat, light, or motion, according to his needs. Is this Utopian? A map of the world that does not include Utopia is not worth even glancing at, for it leaves out the one country at which Humanity is always landing. And when Humanity lands there, it looks out, and, seeing a better country, sets sail.

Progress is the realisation of Utopias."

We can organize ourselves quite differently from the way
we presently manage our wellbeing.

But it won't occur to us until humanity looks out,

and seeing a better country,

sets sail.


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Anonymous Anonymous said...

from costofwar.com

$275 million per day
$4,100 per household
Almost 4,000 U.S. soldiers killed and more than 60,000 wounded
700,000 Iraqis killed and 4 million refugees

I am so tired of the BLAME THE VICTIM rouse our govt, news media, etc blather out. The problem with the US economy is the HUGE debt caused by the Bush war in Iraq. Our economy has turned inside out.

So they blame the mortgage meltdown, people over buying real estate. We don't go to Walmart enough, or Disneyworld.

The reason for the mortgage meltdown is the inversion of capital caused by war debt spending causing, as OZ says -- the necessity of a growth econony that outruns itself in foreign markets until everyone is looking for the pea in the shell game at the same time -- so they have to notice it's not there anymore.

Thanks for this one OZ.

The fix will be temporary -- the real one will have to do with creating a new energy job initiative.


12:30 PM  
Anonymous Anonymous said...

January 22, 2008

Reflections on a Better World

Today's Earthfamilyalpha blog is worthy of reflection on several accounts but primarily for reassuring us that the absurd is indeed absurd and that we know in our heart of hearts that spending, spending and spending will neither make us rich nor happy. Yet the
economic wise men insist on this maxim with religious fervor. So entrenched is this idea in the Wall street psyche that we are urged
to spend all that we have and when that runs out borrow against our future wages and spend that now, and if our future wages have all been drawn down , we are urged to borrow anyway even if we don't know how we will ever pay it back. And if we have become entirely broken as a credit risk so that even the loan sharks shun us, then the government will give us some money if we will just promise to spend it immediately! Most believe that merely spending will save the country from financial ruin while others believe that
the spending must be accompanied by magical incantations that pay homage to the god of the free market.

There are still others that want to take us out of the loop for fear that we may hoard some of the windfall money that federal government hopes to be distributing by the billions in a month or two. They would send a billion or two directly to the toy sellers or computer manufacturers or auto makers provided they take their goods directly to the landfill by-passing the consumer entirely, but the objection to this is that the economy would have to forego selling the energy needed to wear out these often unneeded items if they went directly from the manufacturer to the dump.

The argument against sticking pins in a doll to effect an outcome is not so much that it doesn't work, but that there is no accepted scientific theory to back it up. Economic theories do not even have the apparent causes and effects enjoyed by voodoo. If taxes are cut
and revenue increases then it is said that it is axiomatic that cutting taxes increases revenue and of course if taxes are entirely eliminated then government revenue will be maximized. If taxes are cut and revenue falls then it is said that more tax cuts are needed to make it work and if more tax cuts do not increase revenue nor stimulate the general economy then it is said that without the tax cuts things would have been worse and on and on. Since there is absolutely no consistent consensus among economists then it boils down to a matter of spin. Big tax payers have big spinners who are given big money to influence law makers of small ethics.

The point is that this isn't even good voodoo. It is raw power having its way and talking out of both sides of its mouth. When Bush first
got to be president he urged tax cuts to stimulate the economy and later urged tax cuts to keep the economy from being over stimulated.

The notion that machines could be the property of all will be assailed as left wing, socialist, communism and against freedom and democracy. A quick revue of the CIA and their predecessor shows that since1945 there primary business has been to strangle in the crib any such ideas. We like social security, and we like to have to be treated if we are injured and have no money, but we hate socialism down to the core of our being. We don't want our kids to eat lead paint or the wheels to fall off the car we are driving, but we hate government regulation and say that we believe free market competition will keep us safe, protect our jobs , etc., etc. Somehow there is a disconnect between what we know and what we say we believe.


4:00 PM  

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