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'Global Trumpism': Bailouts, Brexit and battling climate change | CBC Radio
[Also here:
https://www.cbc.ca/radio/ideas/global-trumpism-how-rogue-code-writers-became-the-authors-of-our-politics-1.5321199
https://www.cbc.ca/listen/live-radio/1-23-ideas/clip/15741291-global-trumpism-bailouts-brexit-and-battling-climate-change ]

“How did the middle class end up in perpetual debt? Why is there ‘no money’ for infrastructure or social programs, but there is for waging war? And what does all this have to do with Donald Trump, or Brexit, or climate change?

If you’re mystified about any of the above, then author and Brown University professor Mark Blyth can clarify things for you. He says it’s helpful to use a computer metaphor to describe the economy.

In his lecture at McMaster University as part of their Socrates Project, Blyth compared capitalist economies to laptops: different makes, but similar in appearance. He argues these computers run just fine for a while — say, about 30 years . But all the while, there are bugs in the software that eventually causes the system to crash. Then you rebuild the hardware, fix the software, and reboot.

System breakdown
That’s what happened in the 1970s and 1980s, when labour costs and inflation became a problem. The ‘system rebuild’ included less powerful unions, more global trade, and central bankers who were put in charge of setting interest rates.

But this new system generated bugs of its own, among them, a runaway culture of lending, and a lack of wage growth among the middle classes, who did a lot more borrowing than they could afford.

Mark Blyth says this borrowing wasn’t just driven by rampant consumerism.

“How do you get by when … everybody tells you there’s no inflation, yet the cost of everything that matters is actually going up? Education, health care, all that sort of stuff,” Blyth said in his lecture.

“And the only way you can fill in the gap is to borrow more money.”

Cue the 2008 financial crisis
However this time, Blyth says there was no rebuild. Instead, the United States Federal Reserve led a bailout of the big banks, domestically and internationally. The rich got much richer, the middle class got perpetual low interest rates to keep carrying their debts, and the poor had their social programs cut in the name of austerity.

Blyth contends this dynamic is what lit the fuse of global populism: the rise of leaders who appeal to public outrage, alienation, and lack of trust toward career politicians and traditional political parties.

“Your debts are too high…you can’t pay them off, but you can roll them over. They’re not going to be eaten away by inflation, and the people who brought you here have zero credibility,” said Blyth.

[video: https://www.youtube.com/watch?v=KGuaoARJYU0 ]

Blyth compares populist leaders to ‘rogue code-writers’, hacking into the software of a system that was never properly rebuilt after the crisis of 2008. This is not necessarily a bad thing, especially if it strengthens democracies.

“[Populism] is now part of the furniture … It’s already changed, so just get used to it. And let’s remember historically that 100 years ago, the people who were the populists then, the people that everyone was afraid of, became the established parties in many cases,” Blyth told IDEAS host Nahlah Ayed.

“So every now and again you have to have a little revolution, and that’s what’s happening now.”

Populism is springing up on the right and the left, said Blyth. The difficult choices that need to be made about climate change could come from a left-wing populist movement, not unlike the so-called ‘Green New Deal’ proposed by younger American Democrats like Alexandria Ocasio-Cortez.

Looking at how things may unfold in the not-too-distant future, Blyth speculates “right populism wins round one.”

“But ultimately, left populism wins round two, because left populism is the only one that takes climate change seriously,” he concludes.”
2019  markblyth  economics  inequality  brexit  donaldtrump  trumpism  fragility  greatrecession  2007  2008  policy  democracy  personaldebt  debt  taxes  wealth  income  climatechange  bailouts  finance  recessions  recession  oligarchy  popularism  berniesanders  banking  global  financialcrisis  inflation  productivity  consumerism  stockmarket  ipos  wages  middleclass  capitalism  us  uk  canada  caymanislands  delaware  arizona  isleofman  austerity  nahlahayed  latecapitalism  federalreserve  priorities  centralbanks  monetarypolicy  politics  alangreenspan  economists  loans  creditcards  spending 
4 weeks ago by robertogreco
Lingua Franca - February 2001 | Cover Story: The Ex-Cons
"The only thing that arouses Luttwak's ire more than untrammeled capitalism is its elite enthusiasts—the intellectuals, politicians, policy makers, and businessmen who claim that "just because the market is always more efficient, the market should always rule." Alan Greenspan earns Luttwak's special contempt: "Alan Greenspan is a Spencerian. That makes him an economic fascist." Spencerians like Greenspan believe that "the harshest economic pressures" will "stimulate some people to...economically heroic deeds. They will become great entrepreneurs or whatever else, and as for the ones who fail, let them fail." Luttwak's other b'te noire is "Chainsaw Al" Dunlap, the peripatetic CEO who reaps unimaginable returns for corporate shareholders by firing substantial numbers of employees from companies. "Chainsaw does it," says Luttwak, referring to Dunlap's downsizing measures, "because he's simpleminded, harsh, and cruel." It's just "economic sadism." Against Greenspan and Dunlap, Luttwak affirms, "I believe that one ought to have only as much market efficiency as one needs, because everything that we value in human life is within the realm of inefficiency—love, family, attachment, community, culture, old habits, comfortable old shoes.""



"Although Luttwak writes in his 1999 book Turbo-Capitalism, "I deeply believe...in the virtues of capitalism," his opposition to the spread of market values is so acute that it puts him on the far end of today's political spectrum—a position that Luttwak congenitally enjoys. "Edward is a very perverse guy, intellectually and in many other ways," says former Commentary editor Norman Podhoretz, one of Luttwak's early champions during the 1970s. "He's a contrarian. He enjoys confounding expectations. But I frankly don't even know how serious he is in this latest incarnation." Luttwak insists that he is quite serious. He calls for socialized medicine. He advocates a strong welfare state, claiming, "If I had my druthers, I would prohibit any form of domestic charity." Charity is a "cop-out," he says: It takes dignity away from the poor."

[via: https://twitter.com/jonathanshainin/status/907983419413381120
via: https://twitter.com/camerontw/status/908176042182950914 ]

[from the responses to the tweet above:

"reminds me of kurt vonnegut on buying an envelope"
https://twitter.com/okay_dc/status/907991703184912386

"[When Vonnegut tells his wife he's going out to buy an envelope] Oh, she says, well, you're not a poor man. You know, why don't you go online and buy a hundred envelopes and put them in the closet? And so I pretend not to hear her. And go out to get an envelope because I'm going to have a hell of a good time in the process of buying one envelope. I meet a lot of people. And, see some great looking babes. And a fire engine goes by. And I give them the thumbs up. And, and ask a woman what kind of dog that is. And, and I don't know. The moral of the story is, is we're here on Earth to fart around. And, of course, the computers will do us out of that. And, what the computer people don't realize, or they don't care, is we're dancing animals. You know, we love to move around. And, we're not supposed to dance at all anymore."

http://blog.garrytan.com/kurt-vonnegut-goes-to-buy-an-envelope-profund
https://news.ycombinator.com/item?id=9299135 ]

[also from the responses:

"Excellent. Nicholas Carr http://www.roughtype.com/?p=4708 "
https://twitter.com/BrianSJ3/status/908022365128462337

"Pichai doesn’t seem able to comprehend that the essence, and the joy, of parenting may actually lie in all the small, trivial gestures that parents make on behalf of or in concert with their kids — like picking out a song to play in the car. Intimacy is redefined as inefficiency."
http://www.roughtype.com/?p=4708 ]

[Cf: "The automated island"
http://crapfutures.tumblr.com/post/161539196134/the-automated-island

"In his frankly curmudgeonly but still insightful essay ‘Why I am Not Going to Buy a Computer’ (1987), Wendell Berry lays out his ‘standards for technological innovation’. There are nine points, and in the third point Berry states that the new device or system ‘should do work that is clearly and demonstrably better’ than the old one. This seems obvious and not too much to ask of a technology, but how well does the automated entrance at Ponta Gorda fulfill that claim?

Berry also has a point, the last in his list, about not replacing or disrupting ‘anything good that already exists’. This includes relationships between people. In other words, solve actual problems - rather than finding just any old place to put a piece of technology you want to sell. Even if the scanners at Ponta Gorda did work, how would eliminating the one human being who is employed to welcome visitors and answer questions improve the system? In Berry’s words, ‘what would be superseded would be not only something, but somebody’. The person who works there is a ‘good that already exists’, a human relationship that should be preserved, especially when her removal from a job would be bought at so little gain."]
2001  efficiency  capitalism  policy  politics  alangreenspan  edwardluttwak  freemarkets  humans  humanism  love  family  attachment  community  culture  canon  inefficiency  economics  slow  small  coreyrobin  charity  poverty  markets  welfarestate  dignity  normanpodhoretz  karlmarx  marxism  johngray  conservatism  thatcherism  ronaldreagan  elitism  kurtvonnegut  nicholascarr  parenting 
september 2017 by robertogreco
Why capitalism can’t survive without socialism - Vox
"Sean Illing

This raises a thorny question: The kinds of skills this technological economy rewards are not skills that a majority of the population possesses. Perhaps a significant number of people simply can’t thrive in this space, no matter how much training or education we provide.

Eric Weinstein

I think that's an interesting question, and it depends a lot on your view of education. Buckminster Fuller (a prominent American author and architect who died in 1983) said something to the effect of, "We're all born geniuses, but something in the process of living de-geniuses us." I think with several years more hindsight, we can see that the thing that de-geniuses us is actually our education.

The problem is that we have an educational system that's based on taking our natural penchant for exploration and fashioning it into a willingness to take on mind-numbing routine. This is because our educational system was designed to produce employable products suitable for jobs, but it is jobs that are precisely going to give way to an economy increasingly based on one-off opportunities.

Sean Illing

That’s a problem with a definable but immensely complicated solution.

Eric Weinstein

Part of the question is, how do we disable an educational system that is uniformizing people across the socioeconomic spectrum in order to remind ourselves that the hotel maid who makes up our bed may in fact be an amateur painter? The accountant who does our taxes may well have a screenplay that he works on after the midnight hour? I think what is less clear to many of our bureaucrats in Washington is just how much talent and creativity exists through all walks of life.

What we don't know yet is how to pay people for those behaviors, because many of those screenplays and books and inventions will not be able to command a sufficiently high market price, but this is where the issue of some kind of hybridization of hypercapitalism and hypersocialism must enter the discussion.

“We will see the beginning stirrings of revolution as the cost for this continuing insensitivity”
Sean Illing

Let's talk about that. What does a hybrid of capitalism and socialism look like?

Eric Weinstein

I don't think we know what it looks like. I believe capitalism will need to be much more unfettered. Certain fields will need to undergo a process of radical deregulation in order to give the minority of minds that are capable of our greatest feats of creation the leeway to experiment and to play, as they deliver us the wonders on which our future economy will be based.

By the same token, we have to understand that our population is not a collection of workers to be input to the machine of capitalism, but rather a nation of souls whose dignity, well-being, and health must be considered on independent, humanitarian terms. Now, that does not mean we can afford to indulge in national welfare of a kind that would rob our most vulnerable of a dignity that has previously been supplied by the workplace.

People will have to be engaged in socially positive activities, but not all of those socially positive activities may be able to command a sufficient share of the market to consume at an appropriate level, and so I think we're going to have to augment the hypercapitalism which will provide the growth of the hypersocialism based on both dignity and need.

Sean Illing

I agree with most of that, but I’m not sure we’re prepared to adapt to these new circumstances quickly enough to matter. What you’re describing is a near-revolutionary shift in politics and culture, and that’s not something we can do on command.

Eric Weinstein

I believe that once our top creative class is unshackled from those impediments which are socially negative, they will be able to choose whether capitalism proceeds by evolution or revolution, and I am hopeful that the enlightened self-interest of the billionaire class will cause them to take the enlightened path toward finding a rethinking of work that honors the vast majority of fellow citizens and humans on which their country depends.

Sean Illing

Are you confident that the billionaire class is so enlightened? Because I'm not. All of these changes were perceptible years ago, and yet the billionaire class failed to take any of this seriously enough. The impulse to innovate and profit subsumes all other concerns as far as I can tell."



"Sean Illing

I suppose that’s my point. If the people with the power to change things are sufficiently cocooned that they fail to realize the emergency while there’s still time to act, where does that leave us?

Eric Weinstein

Well, the claim there is that there will be no warning shots across the bow. I guarantee you that when the Occupy Wall Street demonstrators left the confines of Zuccotti Park and came to visit the Upper East Side homes of Manhattan, it had an immediate focusing on the mind of those who could deploy a great deal of capital. Thankfully, those protesters were smart enough to realize that a peaceful demonstration is the best way to advertise the potential for instability to those who have yet to do the computation.

“We have a system-wide problem with embedded growth hypotheses that is turning us all into scoundrels and liars”
Sean Illing

But if you're one of those Occupy Wall Street protesters who fired off that peaceful warning shot across the bow six years ago, and you reflect on what’s happened since, do have any reason to think the message was received? Do you not look around and say, “Nothing much has changed”? The casino economy on Wall Street is still humming along. What lesson is to be drawn in that case?

Eric Weinstein

Well, that's putting too much blame on the bankers. I mean, the problem is that the Occupy Wall Street protesters and the bankers share a common delusion. Both of them believe the bankers are more powerful in the story than they actually are. The real problem, which our society has yet to face up to, is that sometime around 1970, we ended several periods of legitimate exponential growth in science, technology, and economics. Since that time, we have struggled with the fact that almost all of our institutions that thrived during the post-World War II period of growth have embedded growth hypotheses into their very foundation.

Sean Illing

What does that mean, exactly?

Eric Weinstein

That means that all of those institutions, whether they're law firms or universities or the military, have to reckon with steady state [meaning an economy with mild fluctuations in growth and productivity] by admitting that growth cannot be sustained, by running a Ponzi scheme, or by attempting to cannibalize others to achieve a kind of fake growth to keep those particular institutions running. This is the big story that nobody reports. We have a system-wide problem with embedded growth hypotheses that is turning us all into scoundrels and liars."



"Sean Illing

So our entire economy is essentially a house of cards, built on outdated assumptions and pushed along with gimmicks like quantitative easing. It seems we’ve gotten quite good at avoiding facing up to the contradictions of our civilization.

Eric Weinstein

Well, this is the problem. I sometimes call this the Wile E. Coyote effect because as long as Wile E. Coyote doesn't look down, he's suspended in air, even if he has just run off a cliff. But the great danger is understanding that everything is flipped. During the 2008 crisis, many commentators said the markets have suddenly gone crazy, and it was exactly the reverse. The so-called great moderation that was pushed by Alan Greenspan, Timothy Geithner, and others was in fact a kind of madness, and the 2008 crisis represented a rare break in the insanity, where the market suddenly woke up to see what was actually going on. So the acute danger is not madness but sanity.

The problem is that prolonged madness simply compounds the disaster to come when sanity finally sets in."
2017  capitalism  socialism  business  dystopia  history  seanilling  ericweinstein  economics  politics  policy  productivity  technology  inequality  revolution  dignity  creativeclass  creativity  repetition  ows  occupywallstreet  banks  banking  finance  ponzischemes  alangreenspan  timothygeitner  civilization  systems  systemsthinking  growth  society  science  automation 
august 2017 by robertogreco
All Watched Over By Machines of Loving Grace Episode 1 | varnelis.net
"But I had high hopes for this series. It had been some time since he had made a new one and I thought that by now he would have reworked his style and produced something of striking originality. I had hoped for a fresh take on network culture. After all, I will be the first with my hand in the air to accuse network culture of promoting elitism and individualism. Its influence on our society, particularly on the academy and the creative fields, has been pervasive and pernicious.

All Watched Over, alas, almost descends into self-parody. The first episode seems to loosely take Richard Barbrook and Andy Cameron's fifteen year old Californian Ideology article as a reference point (although he fails to mention that they coined the term in a critical essay and misses the point about the critical influence of the counterculture in forging Silicon Valley's libertarian mindset) but he veers off into a protracted discussion of Ayn Rand."
aynrand  kazysvarnelis  allwathedoverbymachinesoflovinggrace  adamcurtis  networkculture  networks  californianideology  andycameron  richardbarbrook  alangreenspan  wallstreet  chicagoschool  billclinton  geoffwaite  davidharvey  cyberculture  fredturner  thecenturyoftheself  2011 
june 2011 by robertogreco
YouTube - RSA Animate - Crises of Capitalism
"In this RSA Animate, radical sociologist David Harvey asks if it is time to look beyond capitalism towards a new social order that would allow us to live within a system that really could be responsible, just, and humane?"
davidharvey  capitalism  economics  politics  rsaanimate  homeownership  us  culture  germany  greece  policy  banks  finance  banking  canon  housing  worldbank  imf  neoliberalism  liberalism  alangreenspan  marxism  instability  systemicrisk  capitalaccumulation  crisis  labor  capital  1970s  1980s  unions  offshoring  power  wagerepression  wages  credit  creditcards  debt  personaldebt  2010  limits  greed  profits  industry  london  uk  latinamerica  wealth  india  china  inequality  incomeinequality  wealthinequality  hedgefunds 
june 2010 by robertogreco
Pension funds chasing highest returns on investment force behind recession | Business | The Guardian
"These savers have racked up trillions of dollars over the last 30 years and own much of the wealth created during that period. Their power is vast. They own the homes, the stock markets and they lent their cash to the banks, governments and companies and as we know to our cost, there were plenty of them.
rcession  greed  2010  greatrecession  investments  pensions  risk  europe  us  uk  california  retirement  savings  alangreenspan 
april 2010 by robertogreco
Joseph E. Stiglitz on capitalist fools: About Us: vanityfair.com
"Behind the debate over remaking U.S. financial policy will be a debate over who’s to blame. It’s crucial to get the history right, writes a Nobel-laureate economist, identifying five key mistakes—under Reagan, Clinton, and Bush II—and one national delusion."
josephstiglitz  bubbles  finance  crisis  2008  georgewbush  alangreenspan  billclinton  us  markets  deregulation  bailout  regulation  business  history  economics  politics  capitalism  meltdown  banking 
december 2008 by robertogreco
Simon Caulkin: Guess what? Self-interest is bad for the economy | Business | The Observer
"When Alan Greenspan told the House Oversight Committee 'I made a mistake in presuming that the self-interests of organisations, specifically banks and others, were such that they were best capable of protecting their own shareholders and their equity in the firms', the effect was the same as Frodo and Sam casting the Ring of Power into the fires of Mount Doom at the end of The Lord of the Rings: the edifice of 21st-century management shook to its foundations.
via:preoccupations  alangreenspan  economics  capitalism  self-interest  management  policy  markets  corporations  2008  crisis 
november 2008 by robertogreco
Greenspan - I was wrong about the economy. Sort of | Business | The Guardian
"The former Federal Reserve chairman, Alan Greenspan, has conceded that the global financial crisis has exposed a "mistake" in the free market ideology which guided his 18-year stewardship of US monetary policy. A long-time cheerleader for deregulation, Greenspan admitted to a congressional committee yesterday that he had been "partially wrong" in his hands-off approach towards the banking industry and that the credit crunch had left him in a state of shocked disbelief. "I have found a flaw," said Greenspan, referring to his economic philosophy. "I don't know how significant or permanent it is. But I have been very distressed by that fact." It was the first time the man hailed for masterminding the world's longest postwar boom has accepted any culpability for the crisis that has engulfed the global banking system."
alangreenspan  finance  crisis  banking  2008  business  money  economics  politics  capitalism  creditcrunch  neoliberalism  deregulation  via:cityofsound 
october 2008 by robertogreco

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