Tuesday, January 31, 2012

On Italians

The state has no meaning to us. Our sense of community ends when we reach our doorsteps. Indeed, the doormat – not to mention the apartment block staircase and the pavement – has become a no-man's land. We have been a country only for a century and a half. For 2,000 years, we have bowed down before dozens of invaders, obviously in a constant attempt to cheat them. We survived by locking ourselves away in our homes and branding all those in authority as usurpers – as well as foreigners.

Massimo Granellini, Italian stereotypes: yes, we are all individuals! (the Guardian)

Good advice. I once jokingly said that Italy is the place I'd like to ride out the collapse - good food, nice climate, shrinking population, and they've already been through at least one civilizational collapse.

Gregory Clark Gets It

Some important thoughts from economist Gregory Clark, author of A Farewell To Alms
For much of the past 200 years, unskilled workers benefited greatly from capitalism. Before the Industrial Revolution, for example, skilled construction workers earned 50 to 100 percent more than unskilled laborers; today, that premium has fallen to 33 percent in the United States. The era of the two world wars, 1914 to 1945, was one of particularly sharp gains for the wages of unskilled workers, relative to the rest.

Why have the unskilled fared so well? After all, machines -- whether steam engines, internal combustion engines or electric motors -- have replaced people as deliverers of brute force. But even today they cannot replace many of people's manipulative abilities, language skills and social awareness. The hamburger you eat at McDonald's is still put together and delivered to you by human hands; even a fast-food "associate" deploys an astonishing repertoire of spatial and language skills.

But in more recent decades, when average U.S. incomes roughly doubled, there has been little gain in the real earnings of the unskilled. And, more darkly, computer advances suggest these redoubts of human skill will sooner or later fall to machines. We may have already reached the historical peak in the earning power of low-skilled workers, and may look back on the mid-20th century as the great era of the common man.

I recently carried out a complicated phone transaction with United Airlines but never once spoke to a human; my mechanical interlocutor seemed no less capable than the Indian call-center operatives it replaced. Outsourcing to India and China may be only a brief historical interlude before the great outsourcing yet to come -- to machines. And as machines expand their domain, basic wages could easily fall so low that families cannot support themselves without public assistance.

With the march of technology, the size of a future American underclass dependent on public support for part of its livelihood is hard to predict: 10 million, 20 million, 100 million? We could imagine cities where entire neighborhoods are populated by people on state support. In France, generous welfare has already produced huge suburban housing estates, les banlieues, populated with a substantially unemployed and immigrant population, parts of which have periodically burst into violent protest.

So, how do we operate a society in which a large share of the population is socially needy but economically redundant? There is only one answer. You tax the winners -- those with the still uniquely human skills, and those owning the capital and land -- to provide for the losers.
Gregory Clark -- As Economic Disparity Grows, Higher Taxes May Be Only Solution (Washington Post)

The Unemployment Crisis

Davos 2012: Youth Unemployment Disaster (BBC)

The world, they say, is "sitting on a social and economic time bomb". The world is plagued by youth unemployment. The numbers are stark: In some countries of the Arab world, up to 90% of 16-24 year olds are unemployed. In the United States the youth unemployment rate is 23%. In Spain nearly 50%. In the UK 22%. Worldwide, some 200 million people are unemployed. 75 million are between 16 and 24 and every year about 40 million young people are entering the workforce.

One in ten people in the European Union are unemployed. One in five people in Spain is unemployed. As the article points out, the youth excluded from participating in the economy will never recover. This will have a permanent impact on the economy.

It’s a simple story – first workers got kicked out of agriculture, then they got kicked out of manufacturing. The remaining ‘service’ jobs were too scarce and too specialized to provide full employment, even as the fruits of automated agriculture and industry kept the population growing. The systematic imbalances between the number of people needing to work and the jobs available is causing capitalism to break down. Under the current system, the only way to procure the things needed is to sell one’s labor, since both land and means have production have consolidated into the hands of a relatively small slice of humanity. Thus, most people don’t own any means of wealth creation. Just as unusable goods pile up on shelves, unusable workers are piling up worldwide. Deprived of the means to earn a living and with nothing to lose, they’re tearing the world apart. More education doesn’t help, because the demand for even educated workers is finite. The story is told in this article and chart: Where did all the workers go? According to the article: “Manufacturing and agriculture employed one in three workers just after World War II. Today, those sectors employ only one in eight.” More from the article:

The big story about American jobs in the post-war period is this: The manufacturing/agriculture economy shrunk from 33% to 12%, and the services economy grew from 24% to 50%. I don't want to leave you with a facile explanation, but for the purposes of space, I think it's acceptable to say that as manufacturing and agriculture got more efficient, they required fewer American workers, while the services industry (which had slower efficiency gains since it has more person-to-person work) required more employees to keep up with the rising demand for consulting, nurses, teachers, computer technicians, and so on.

And an interesting feature of services is Baumol’s cost disease:

Both industries [health care and education] suffer from an ailment called Baumol’s cost disease, which was diagnosed by the economist William Baumol, back in the sixties. Baumol recognized that some sectors of the economy, like manufacturing, have rising productivity—they regularly produce more with less, which leads to higher wages and rising living standards. But other sectors, like education, have a harder time increasing productivity. Ford, after all, can make more cars with fewer workers and in less time than it did in 1980. But the average student-teacher ratio in college is sixteen to one, just about what it was thirty years ago. In other words, teachers today aren’t any more productive than they were in 1980. The problem is that colleges can’t pay 1980 salaries, and the only way they can pay 2011 salaries is by raising prices. And the Baumol problem is exacerbated by the arms-race problem: colleges compete to lure students by investing in expensive things, like high-profile faculty members, fancy facilities, and a low student-to-teacher ratio.
From the Atlantic article:

Closing thought: Why isn't anybody talking about the tragic decline of agriculture? The industry's share of workers has fallen by 80 percent in the last 60 years. Nobody seems to think that's much of a tragedy, but we do consider it tragic that manufacturing has lost 60 percent of its share over the same period. Are we being hyperbolic about the decline of manufacturing, in particular, or are we being way too stoic about the greater loss in agriculture employment?

Of course a centralized authority could find work for people to do, but “government” jobs are considered somehow “fake” and government workers are derided as lazy. Such things are considered wasteful, but consider how our drive for efficiency has sidelined much of the world’s workers. If the government employs workers directly, there is a fear among the elites that this will lead to socialism, which was supposedly vanquished by the fall of the Soviet Union. Hence the drive for ‘austerity’ which are sidelining much of the world’s workers.

This trend seems unavoidable, embedded as it is in the current paradigm. Part of it is the nature of work itself. It is so highly specialized, that once you get laid off, you may never work again. For proof of this, see this article: Old Techies Never Die; They Just Can’t Get Hired as an Industry Moves On.

I like this quote from the BBC article:

"Universities are just too slow," said one industrialist. "If I tell them that I need graduates with different skills, it takes them two years or more to change their courses. By then technology will be changing yet again."

What’s amazing is that the problem is never the economy – it’s always with the workers themselves. They just somehow are never good enough, no matter what they do. In other words, humans must conform to the needs of the economy, not the other way around. Why does no one ever question this ridiculous thinking? More truthful is this quote:

However, another boss warned that "a good education does not guarantee you a good life anymore."

Finally, someone tells the truth. Kind of flies in the face of "more education" as a solution, doesn't it? Welcome to Capitalism 2.0, where nothing you do guarantees you a good life anymore (except, maybe choosing your parents wisely).

The problems are structural. Tinkering around the edges will do not good. So where will all those workers go?

Here: Rise of the shadow economy, the second largest in the world.

Is it any wonder even the elites at Davos now see the world turning into a dystopia?

BONUS: Latest Congressional Budget Outlook For 2012-2022 Released, Says Real Unemployment Rate Is 10% (Zero Hedge). Will anything reverse this trend? If so, what?

Monday, January 30, 2012

Should We Follow Japan's Example?

Less people living longer, healtheir lives. More resources to go around and less pressure on natural resources on an overcrowded island. What's not to like? Well, our Ponzi-scheme infinite growth economy doesn't like it:

The Japanese population is expected to shrink by one third in the next half century, a government report says. The Health and Welfare ministry estimates that 40% of the population will be of retirement age by 2060. It says that life expectancy - already one of the highest in the world - will continue to rise.

The government report says that by 2060, Japan will have 87 million people, down from today's 128 million. The proportion aged 65 or older is expected to double to 40%.

At the same time the national workforce - comprising people aged between 15 to 65 - will shrink to about half of the total population, estimates released by the National Institute of Population and Social Security Research say.

The research says that Japan's population will keep declining by one million people every year in coming decades
What if the whole world followed Japan's example? How many problems would be solved?

Japan population to shrink by one-third by 2060 (BBC)

Young Japanese 'decline to fall in love' (BBC)
Japan leads the way in sexless love (The Guardian)

BONUS: Pregnant, and pushed out of a job (New York Times). Why would anyone interested in self-preservation have a child in America anymore?

Sunday, January 29, 2012

Just Finished Reading 1493

By Charles Mann. One of the two "must read" books that came out last year. I'm currently reading the other one - Debt: the First 5,000 Years by David Graeber. Here are two interesting sections from 1493:
Hong Liangji was born in 1746 near the mouth of the Yangzi, into a family that slowly went on the skids after the unexpected death of his father...Sometime in 1793 Hong Liangji thought of an idea that may never have occurred to anyone else before. After finally winning a place in the Qing bureaucracy at the age of forty-four--Hong had failed the civil service exam four times--he was sent as an education inspector to Guizhou Province, in the southwestern hinterland. Essentially a sloping, heavily eroded limestone shelf, the province is a humid jumble of steep gorges, protuberant hills, and long caverns. It was another target for Qing occupation, thronged with migrants from central China who were pushing out its original inhabitants, the Miao. The newcomers were climbing up the hills, planting maize, and beginning families. Hong wondered how long the boom could last.

"Today's population is five times as large as that of thirty years ago," he wrote, with perhaps pardonable exeggeration, "ten times as large as that of sixty years ago." He imagined a man with "a ten-room house and 100 mu [about seventeen acres] of farmland." If the man married and had three adult sons, then eight people--the four men and their wives--would live on the parents' farm.

Eight people would require the help of hired servants; there would be, say, ten people in the household. With the ten-room house and the 100 mu of farmland, I believe they would have just enough space to live in and food to eat, although barely enough. In time, however, there will be grandsons who, in turn, will marry. The aged members of the household will pass away, but there could still be more than twenty people in the family. With more than twenty people sharing a house and working 100 mu of farmland, I am sure that even if they eat very frugally and live in crowded quarters, their needs will not be met.

Hong conceded that the Qing had opened up new land to support China's population, But the amount of farmland had

only doubled or, at the most, increased three to five times, while the population has grown ten to twenty times. thus farmland and houses are always in short supply, while there is always a surplus of households and population...

Question: Do Heaven-and-earth have a way of dealing with this situation? Answer: Heaven-and-earth's way of making adjustments lies in flood, drought, and plagues.

Five years later, in England, a similar notion came to another man: Rev. Thomas Robert Malthus. A shy, kindly fellow with a slight harelip, Malthus was the first person to hold a university position in economics--that is, the first professional economist--in Britain, and probably the world. He was impelled to think about population growth after a disagreement with his father, a well-heeled eccentric in the English style. The argument was over whether the human race could transform the world into a paradise. Malthus thought not, and said so at length--55,000 words, published as an unsigned broadside in 1798. Several longer version followed. these were signed; Malthus had become more confident.

"The power of population," Malthus proclaimed, "is definitely greater than the power of the earth to produce subsistence for man." ...Every effort to increase the food supply, Malthus argued, will only lead to an increase in population that will more than cancel out the increase in the food supply--as state of affairs today known as a Malthusian trap. Forget Utopia, Malthus said. Humanity is doomed to exist, now and forever, at the edge of starvation. Forget charity too: helping the poor only leads to more babies, which in turn produces increased hardship down the road. No matter how big the banquet grows, there will always be too many hungry people wanting a seat at the table. The Malthusian trap cannot be escaped.

The reaction was explosive...Hong, by contrast, was ignored. Unlike Malthus, he never developed his thoughts systematically, in part because he devoted his energy to criticising the corrupt officials whom he believed were looting the Qing state. Appalled at the government's brutal, incompetent reaction to a rebellion by starving peasants in Sichuan and Shaanxi, Hong quit his job in 1799. On his way out, he shot off a rambling but remarkably blunt letter to the crown prince, who passed it to the Jiaqing emperor. The angered emperor sentenced Hong to life in exile, silencing him.

The lack of recognition was unmerited; Hong apparently captured the workings of the Malthusian trap better than Malthus (I use the hedge word "apparently" because he never worked out the details.) The Englishman's theory made a simple prediction: more food would lead to more mouths would lead to more misery. In fact, though, the world's farmers have more than kept pace. Between 1961 and 2007 humankind's number doubled, roughly speaking, while global harvest of wheat, rice and maize tripled. As population has soared, in fact, the percentage of chronically malnourished has fallen-contrary to Malthus's prediction. Hunger still exists, to be sure, but the chance that any given child will be malnourished has steadily, hearteningly declined. Hong, by contrast, pointed to a related but more complex prospect. The continual need to increase yields, Hong presciently suggested, would lead to an ecological catastrophe, which would cause social dysfunction--and with it massive human suffering. (emphasis mine-CH)

Exactly this process is what researchers today mean when they talk about the Malthusian trap. Indeed, once way to summarize today's environmental disputes is to say that almost all boil down to the question of whether humankind will continue to accumulate wealth and knowledge, as has been the case since the Industrial Revolution, or whether the environmental impacts of that accumulation--soil degradation, loss of biodiversity, consumption of groundwater supplies, climate change--will snap shut the jaws of the Malthusian trap, returning the earth to pre-industrial wretchedness. China provides an example of the latter, at least in part. In the decades after American crops swept into the highlands, the richest society in the world was convulsed by a struggle with its own environment--a struggle it decisively lost.
from 1493: Uncovering the New World Columbus Created by Charles Mann, pp.177-180.
Today scholars often describe the "Green Revolution" after the Second World War--the combination of high-yield crops, agricultural chemicals, and intensive irrigation--as the moment when humankind triumphantly escaped, at least for a while, the limits set by small-scale farms and local resources. But as the Amherst College historian Edward D, Melillo has argued, the arrival of guano ships in Europe and the United States marked an earlier, equally profound Green Revolution, the first in a series of technological innovations that transformed life across the planet.

Before the potato and maize, before intensive fertilization, European living standards were roughly equivalent with those today in Cameroon and Bangladesh; they were below Bolivia or Zimbabwe. On average, European peasants ate less per day than hunting-and-gathering societies in Africa or the Amazon. Industrial monoculture with improved crops and high-intensity fertilizer allowed billions of people--Europe first, and then much of the rest of the world--to escape the Malthusian trap. Incredibly, living standards doubled or tripled worldwide even as the planets' population climbed from fewer than 1 billion in 1700 to about 7 billion today.

Along the way guano was almost entirely replaced by nitrates mined from vast deposits in the Chilean desert. The nitrates in turn were replaced by artificial fertilizers, made in factories by a process invented and commercialized in the early twentieth century by two Nobel-winning German chemists, Fritz Haber and Carl Bosch. No matter what their composition, though, fertilizers remain just as critical to agriculture, and through agriculture to contemporary life. In a fascinating study of factory-made nitrogen, Vaclav Smil, the University of Manitoba geographer, estimated that two out of every five people on earth would no be alive without it.
from 1493: Uncovering the New World Columbus Created by Charles Mann, pp. 219-220

The Problem Is Scale

There is a post by the always interesting professor Ugo Bardi on his blog reviewing a book about why biofuels are a bad idea. The article was also featured on Energy Bulletin. These two paragraphs from the review very succinctly make the point about why biofuels will never be able to be swapped out for fossil fuels to run an economy of the type we have now (emphasis mine):
Biofuels are a complex matter and Giampietro and Mayumi use almost 300 pages to eviscerate it in all its aspects. The main point of their analysis is based on fundamental physics: the efficiency of photosynthesis is low and the result is that the areas needed for cultivation are large. If we are thinking of amounts of biofuels comparable to the present needs for transportation, the task is simply unthinkable: there would be no space left for food production. As the authors flatly state at page 128 of the book, "Full substitution of fossil energy with agro-biofuels is impossible."

The large area needed is only one of the problems with biofuels. More in general, agriculture is a good technology for producing food, but it is terribly expensive in terms of the resources it requires. It needs land, water, fertilizers, pesticides, mechanical work; all supplies that normally come from fossil fuels. Taking all that into account, the EROEI (energy return for energy invested) of biofuels is generally low; unless the invested energy is supplied by low cost human labor, as it is the case for Brazilian sugar cane. Apart from Brazil, the need of an energy subsidy in the form of fossil fuels makes biofuels unable to deliver their promise of being a "sustainable" technology. They can't help us in reducing our dependency on fossil fuels nor in reducing the emission of greenhouse gases in the atmosphere.
If we wanted to produce enough solar panels, windmills, wave-motion generators, nuclear facilites, hydroelectric plants, ethanol factories or hydrogen plants to keep our economy at the present enormous scale, we need fossil fuels. This becomes even more imperative if we need to keep the economy growing in perpetuity. This simply cannot be done.

It's worth noting that nothing we do with fossil fuels cannot be done some other way - from biofuels, to celluose-based plastics to hydroelectric electricity; even factories can be powered by the sun. The problem is entirely one of scale. If we don't deal with scale, we aren't really dealing with the problem at all. That's why Peak Oil and economic reform are joined at the hip.

Cassandra's Legacy: Why biofuels are not a good idea.

ADDENDUM: Do The Math blog comes to a similar conclusion (emphasis in original):
Another way to highlight how daunting a full-scale embrace of biofuels would be, consider that global oil consumption amounts to 6 TW of power (30 billion barrels per year, or 1000 barrels per second, at 6 GJ per barrel). This is about 12 times the human metabolic dietary intake—largely derived from agricultural lands. We’re not about to give up eating, so in the simplest analysis, we would have to find an additional cropland approximately ten times the area of our current cropland.

For scale, Earth’s land totals about 140 million square kilometers. About 50 million are classified as agricultural (includes permanent grazing land), and 13 million as arable. On what planet would we find enough land for sufficient biofuel crops?

Friday, January 27, 2012

Fossil Fuel Subsidies

One thing that gets lost in green energy is the fact that fossil fuels are highly subsidized: David Sirota in Salon:
Listen to the typical conservative rhetoric about energy being thrown around on talk radio or in Republican presidential debates, and you’re likely to hear that our government primarily uses its regulatory and financial power to create a destructive green energy boondoggle — one that enriches a few politically connected Solyndra executives, appeases a bunch of wild-eyed tree huggers, but hides the fact that renewables supposedly can’t stand on their own in the private sector.

In the face of catastrophic climate change and dwindling fossil fuel resources, this cartoonish narrative has gained traction because it invokes the moment’s most powerful political metonyms, from implicit allegations of crony capitalism to hippie-themed epithets about environmentalists to “free market” fundamentalism. The underlying idea — which will only be more amplified in the wake of the Obama administration’s pipeline decision Wednesday — is that fossil fuels are being persecuted by the American government.

But the reality, of course, is something wholly different. Indeed, this mythology is a perfect example of Orwellian Newspeak in which the reverse of the rhetoric is true. As recent news highlights, the government is doing exactly the opposite of what conservatives say: It is aggressively favoring the fossil fuel industry in ways that give that industry a special economic advantage over clean energy.
Matt Yglesias in Slate:
What if I told you that we could obtain half the reduction in carbon emissions needed to stave off climate disaster not with new government interventions in the economy but simply by removing existing interventions?

Fatih Birol, chief economist of the International Energy Agency is telling you exactly that. In data released this month as part of the IEA’s latest World Energy Outlook report, he shows that in 2010 the world spent $409 billion on subsidizing the production and consumption of fossil fuels, dwarfing the word’s $66 billion or so of subsidies for renewable energy. Phasing fossil fuel subsidies out would be sufficient to accomplish about half the reduction in greenhouse gas emissions needed to meet the goal of preventing average world temperatures from rising more than 2 degrees Celsius.

You don’t hear as much about this as you should largely because the biggest offenders are far from our shores. Still, the scale and scope of the issue is worth dwelling on if only because these subsidies are so wrongheaded.
It's similar to the problems with our food system. We don't need to spend more money, all we have to do is stop subsidizing the bad stuff to improve the situation. Too bad it's not likely to happen in either case. All our dysfunctional policies are based on entrenched interests.

Tankless Toilets


The 'Burbs

I was amazed when I saw the following statistics about suburbia embedded in a BBC article:
The Hofstra Suburban Survey, which periodically polls 1,000 US suburbanites, has revealed growing division within suburbs, like both Levittown, PA and its sister city, Levittown, NY, each long saddled with its own stubborn myth of uniformity and prosperity.

In 2011, 40% of survey respondents reported living "paycheck to paycheck" most or all of the time. Twenty per cent had lost a job since the last election, and 59% more knew someone who had. Thirty-eight percent knew someone who had lost their home to foreclosure.
Suburban residents are far from a monolithic voting block These rates are marginally better than those of cities and rural areas. Yet given the size of the suburbs, the absolute number of distressed suburbanites dwarfs their urban and rural counterparts, and absolute numbers win states.
On a related note: Slumburbia:

LATHROP, Calif. — Drive along foreclosure alley, through new planned communities that look like tile-roofed versions of a 21st century ghost town, and you see what happens when people gamble with houses instead of casino chips.

Dirty flags advertise rock-bottom discounts on empty starter mansions. On the ground, foreclosure signs are tagged with gang graffiti. Empty lots are untended, cratered with mud puddles from the winter storms that have hammered California’s San Joaquin Valley.

Nobody is home in the cities of the future.

How To Erect a Yurt

The nomadic people of Mongolia don't stay in one place for long. That's why they live in gers (which American's know by the Russian name, yurt), a home that is fast and easy to assemble and disassemble. Putting up a ger (pronounced gair) is fast and easy, but its best done by an entire family. This ger was moved by the family of Shagdarsuren Herelchuluun, on the east side of Lake Hovsgol, in northern Mongolia, not far from the Russian border.

Thursday, January 26, 2012

Soulless, or Why Americans Love Vampires.

One pejorative adjective I often hear used about Americans is “soulless.” “They don’t seem to have a soul" is something that people I know say about other Americans, and I’ve made this same observation myself. But this is a very slippery, hard-to-define concept. What does it mean to say someone has no soul? Well, to give some pertinent observations; most Americans seem to be automatons, sleepwalking around in the pursuit of the next promotion, the bigger (And more distant) house, the newer car, and the latest Xbox. They care about nothing else but their place in the hierarchy, and as long as there is someone below them that they can feel superior to, they care not one whit about concepts like “social mobility” or “justice”. They live to work, and work to consume ever more stuff. There is no soul-searching, no self-reflection, about why they are here on this planet and what is really important in life, except to get that plum job, that next promotion, that new automobile, that fancy degree, and to make sure that one’s offspring are placed well enough to stay in the same class (e.g. moving to the exclusive suburbs to get into the “good schools” and so on). There is no questioning, no curiosity, only a desire to live in comfort and protect what one has. There is an incuriosity about the world, with no desire to ask larger questions or learn anything besides immediately relevant vocational skills. People just push whatever button or pull whatever lever is required to get their reward – no questions asked. People only have relationships to the extent that they can get something from the other person. Real, genuine human emotion based on compassion and selflessness is virtually absent. Climbing the ladder is all that matters in life, no matter who you have to step on. Getting ahead is all that matters, and the devil take the hindmost. It’s worth noting that the more “soulless” one is, the higher their place in the hierarchy (I bet your boss fits this category). It also feels like it’s getting worse. In fact, studies show that empathy is literally declining among college students.

Lately I’ve been listening to a number of interviews with the sociologist Morris Berman. Berman’s critiques help give an actual vocabulary to these concerns. People feel deep down that something is wrong with American society, but what? Berman finally gives a voice and a vocabulary expressing these concerns. There is something “different” and very wrong with life in America, he claims; we don’t notice it because we’re so embedded in it. Why do things feel so wrong? Because many things about American society are fundamentally inhuman, he asserts. His arguments are essentially value-based qualitative arguments about the American lifestyle, and they sound so different from the usual pro-America arguments that center around the size of our economy, our GDP, and the fact that everyone has indoor plumbing, a TV, a car and an iPod. Berman’s arguments, by contrast, are fundamentally rooted in arguments about the quality of life that we just don’t ever hear or consider. I would say they are in the realm of the spiritual, which is why they fall on deaf ears to Americans who are not used to thinking in these terms, despite our religious pretensions.

Berman’s observation is that from the original settling of country back in the sixteenth century, people have come to America to exploit the frontier and to get rich. Berman defines this as the “hustling” way of life, and says it is embedded into our cultural DNA. America, he states, drawing on the work of earlier sociologists, is a “fragment culture”, one that takes only one aspect of an earlier foundational culture, and becomes a one-dimensional society based on that aspect. In America’s case, it was England’s aspirational, pragmatic, entrepreneurial “hustling” get-rich now aspect, divorced from all other elements of society. Thus, making a quick buck is all that defines American culture; there is no other purpose – no art, no literature, no mythology, no sense of social relationships or shared heritage – none of the other things that define a well-rounded three-dimensional human culture. American English, he points out, is alone among world languages in having hundreds of synonyms for “swindle”.

This entrepreneurial “hustling” attitude, combined with America’s seemingly boundless natural resources and Enlightenment-inspired government institutions propelled America to a preeminent place in the world’s economy. But now that we’ve reached the apogee of economic expansion and production, it’s tearing the country apart. We recoil at any attempts to act collectively, and any sense that we have “enough” is instantly dismissed in favor of indistinct rhetoric about the next round of “growth” and “innovation”, as if those will solve all the problems they have not solved to date.

Berman’s ideas dovetail nicely with those of a neuroscientist named Peter Whybrow, who published a book some years ago called “American Mania.” Dr. Whybrow’s insight was that there is a genetic basis for novelty-seeking and addictive cravings, what Berman might call “hustling”, specifically the D4-7 allele which regulates dopamine reward pathways. And Americans, because of their immigrant character, have these genes overrepresented in their citizens, leading to the highly-addictive, frenetic “more-more-more” attitude so common here. Americans are people whose ancestors wrenched themselves out of a social context that they had been embedded in for generations, turning their backs on the stable, relatively sclerotic traditions to go to an unknown, often savage, faraway place in hopes of “making it”, that is, getting rich and moving up the hierarchy. That is, they self-selected. “The streets are paved with gold” was a common refrain told to aspirational immigrants, and in fact, as Berman points out, such messages about America were preeminent all the way back to the late 1500’s! You can imagine what sort of people such messages attracted. Thus, there may be literally a genetic difference between the people in America and people in the rest of the world.

Combine these theories and you get a great insight into a lot of attitudes in America that seem pathological, e.g. if you don’t hustle you deserve to fail and die in a ditch; the rich are the “fittest” in a Darwinian social struggle and deserve everything they get no matter how excessive; any attempt to restrain the behavior of elites is “penalizing success”; CEO’s are “great men” who make society function while their workers are merely parasites, that anyone in poverty has only themselves to blame for it, that rewards are always based on merit, etc. You also explain one of the most distinctive traits that outsiders always tend to remark on – American “optimism”. No matter what the survey is, you can be assured that Americans will be optimistic and bullish about the future. Of course anyone who pulled up their roots and moved thousands of miles to a foreign land where they had no family ties, knew no one, possibly didn’t speak the language, and had no guarantee of a job, had to be optimistic. Most likely these “Pollyanna” genes were passed down, and it’s likely optimistic people were likely to have more children as well, amplifying this gene. This may be why the minority of more realistically-minded people in America can’t seem to understand why their fellow citizens are unable to perceive what’s going on around them. It also explains why pabulum like “you create your own reality” is so popular here, and why the “reality based community” is more and more likely to be liberal nowadays (and why conservatives are happier than liberals). Like hustling, optimism can have advantages for a nation, but blindly holding onto it even as your society literally crumbles around you is not optimism – it easily crosses the fine line into delusion.

All of this explains why the poor are more likely to meekly accept their plight here than anywhere else in the world. We’ve been expanding all of our history. If you cannot grab your piece of the pie, the thinking goes, it’s your own failure for not working hard enough. No one is to blame but you (America’s Calvinist heritage plays a role here too). America is an equal meritocracy, with fluid social mobility. And even if you’re poor, just pump out a bunch of kids whose future is guaranteed to be better than yours. All of it is rubbish, of course, but those narratives sell here thanks to a combination of history (which Berman describes), and self-selection (which Whybrow describes).

The problem is, this type of society drives people crazy. The proof is here – one in five Americans needs to be treated every year for psychiatric disorders! A society that we might expect from people genetically predisposed to hustling and optimism is exactly the society we see today – an extremely wealthy society where most people are poor, where “redistribution” is seen as a crime, and where people on the apex of society who already have more than they can spend or use in a thousand lifetimes are willing to break any rule and rig the game to get even more, even at the cost of tearing the social fabric apart. A country based on little more than hustling in a world of limits slowly eats itself, and that is exactly what we’re seeing as documented so well in real-time collapse blogs like The Downward Spiral and The Economic Collapse blog. This is why Berman’s book is titled Why America Failed (failing might be more apt). When the guiding credo of your culture is “every man for himself,” your society turns into simply a war of all against all (bellum omnia contra omnes), based solely on the principle of “might makes right.” The fundamental question becomes, how can such a society survive? I think the answer is, of course it cannot.

A common refrain I hear from people is “yes, but it’s bad everywhere.” Yes, that’s sadly true, as we see in the case of Greece, and yes, Peak Oil will affect the whole world, but there’s a crucial difference. When you have a society that’s only ever known increasing prosperity and expanding living standards, it has no idea how to function without those things, unlike most of the rest of the world’s cultures. Other cultures have the necessary tools to adapt to a world with limits; they’ve been there before. America has not. As conservative politicians are so fond of saying, character matters. America’s character of greed is the reason the U.S. will tear itself apart in the years ahead. Americans are fundamentally different on a genetic level, and will never stop spending, gobbling up resources, or take the steps to construct a stable and just society, no matter what. America’s rich are like the scorpion in the tale of the turtle and the scorpion.

The story goes like this: A scorpion wishes to cross a river, and entreaties a nearby turtle to ferry him across on his back. The turtle knows the scorpion is deadly, but figures that as long as the scorpion is dependent upon him to cross the river, he will not be stung, which would result in both their deaths. Halfway across the river, the turtle feels the sting of the scorpion in his neck. As they sink under the water, the turtle pleadingly asks the scorpion “why”? “It’s in my nature” is the scorpion’s reply.

Which explains why America’s rich grab ever more even as society crumbles around them. It’s in their nature. The will grab ever more, even at the cost of their own fundamental well-being because it’s simply “in their nature”. They can’t stop themselves, even if it means their own demise and the demise of their entire society. They are compelled by their very core natures, the very natures that made them rich in the first place, to be rapacious to the point of suicide, and nothing will cause them to retreat from this course, even self-preservation. And Americans cultural narratives and genetic predisposition will ensure that they will be able to do exactly that.

This is why I hold out some hope for the rest of the world but none for America. America is different. In discussion of emigrating, occasionally you hear someone saying that leaving would be “giving up”, and that you need to stay and “save” America and take it back from those who “stole It. But nobody stole it, Americans don’t want to be saved; they are getting exactly what they want. Berman’s analysis is a splash of cold water on those who think that way – where we are not is not an accident, but our destiny from the very beginning. Berman’s fundamental message is that the seeds of our decline are embedded in our very DNA. The only question is, do you want to stay on the sinking boat or get the hell off.

In the end, I’m glad I finally have a real vocabulary to describe exactly what’s wrong on a societal level with the country, and exactly why you have a population that seems so soulless*. I only wish I knew what to do about it.

For a good, direct visceral confirmation of the amoral nihilism of the capitalist hustling life in America, see this post - http://www.businessinsider.com/grant-cardone-dont-be-a-little-b--and-get-out-of-the-middle-class-now-10x-rule-2012-1

The middle class is diminishing quickly and if you're in that income bracket, better find some strategic ways to get out immediately or drown with the rest of them. Or so says Grant Cardone, sales expert, host of National Geographic's "Turnaround King" and author of The 10X Rule: The Only Difference Between Success and Failure. And don't blame your financial struggles on the economy — it's all happening because you're not taking responsibility of your mindset. "This [economy] is for real people, real products and real actions, so don't be a little bitch. Don't scream and cry and moan and make excuses. It doesn't change anything. It's a waste of energy. We're in a kill what you eat economy now. If you don't kill it, you're probably not going to eat it."

Get out of the middle class (and into the upper) or prepare to drown. Welcome to America’s endgame. In conclusion, if you know in your heart that something’s wrong, and you don’t know quite why, read Berman’s work.

Dark Ages America – Morris Berman’s Blog
The summary of the book:
Peter Whybrow’s Web site.

* In my opinion, people feel this at a fundamental level, which explains the popularity of vampires and zombies in popular culture.

BONUS: Extreme Optimists Only Learn From Good News (Future Pundit). The most optimistic have frontal lobes that want nothing to do with bad news. Proof there is a biological basis for optimism.

Wednesday, January 25, 2012

The State of the (Soviet) Union

One of the recurring themes here on The Hipcrime Vocab has been how much the modern-day United States resembles the old Soviet Union, and, to a large extent, modern-day Russia. In the eighteenth century, many people pointed out the similarities between the two growing empires, one in the Western hemisphere, and one in the Eastern Hemisphere. Many felt that conflict was inevitable – and so it was for much of the twentieth century.

I think the problems stem from something I noted in an earlier post on the work of Leopold Kohr – bigness seems to be a central problem in both cases. When governments get too big, they tend to become oligarchies in control of a small elite (for an ancient example, see Rome). In terms of bigness, the U.S. has the world’s largest economy, and is up there in terms of land area and population. In terms of Russia, it is the largest in land area, and large in population and natural resources. The only other countries in this league are India and China, and possibly Brazil, although their economies are much smaller (Canada and Australia have large land areas, but relatively small populations). We've seen many of the same problems of a small oligarchy of rich running things, massive poverty for the masses, and governmental corruption in those other countries as well. For now, the promise of "development" using the last of the world's finite resources keeps those latter countires complacent. The trend, not the circumstances, are what people are paying attention to.

In the end, it seems everything degenerates into Wild West conditions – naked struggles for power and a war of all against all. Maybe that’s all “society” and the human condition is – a Darwinian struggle of the fittest. It’s a cynical view, but looking at the social decay of large countries in the face of industrial capitalism, it's hard not to come to that conclusion. Anyway, on that theme, here's a blog post by Adam Curtis about the political climate of the late U.S.S.R. and modern-day Russia. As usual, his post reads like his documentaries, with all sorts of multimedia:

The Years of Stagnation and the Poodles of Power
Everybody is always remarking about how stuck our society feels these days. The music doesn't change, the political parties are all exactly the same, and films and TV dramas are almost always set in the past.

We are also stuck with an economic system that is not delivering the paradise that it once promised - but is instead creating chaos and hardship. Yet no-one can imagine a better alternative, so we remain static - paralysed by a terrible political and cultural claustrophobia.

I want to tell the story of another time and another place not so long ago that was also stifled by the absence of novelty and lacking a convincing vision of the future. It was in the Soviet Union in the late 1970s and 1980s. At the time they called it "the years of stagnation".

There are of course vast differences between our present society and the Soviet Union of thirty years ago - for one thing they had practically no consumer goods whereas we are surrounded by them, and for another western capitalism was waiting in the wings to fill the vacuum. But there are also echoes of our present mood - a grand economic system that had once promised heaven on earth had become absurd and corrupted.

Everyone in Russia in the early 1980s knew that the managers and technocrats in charge of the economy were using that absurdity to loot the system and enrich themselves. The politicians were unable to do anything because they were in the thrall of the economic theory, and thus of the corrupt technocrats. And above all no-one in the political class could imagine any alternative future.

In the face of this most Soviet people turned away from politics and any form of engagement with society and lived day by day in a world that they knew was absurd, trapped by the lack of a vision of any other way.
And here’s a comment on the Decline of the Empire blog.
"Virtual Politricks" is what we have here in America. Read this quote from an interview with an investigative reporter who spent a considerable amount of time in Russia and then came back to America:

"In Russia you have rich oligarchs funding these fake political movements, virtual politics is what they call it, and then using their minions in the media to push it forward and attack anybody who tries to expose it. I didn't realize when we put out this article in 2009 - you know we were attacked pretty seriously by people from the 'Atlantic Monthly' and so on who later turned out to have ties to the Koch brothers - I didn't realize how far down the road to a sort of Russian Oligarchy we had already gone. When you spend a lot of time in Russia, you understand how cynical oligarchs and the rich, especially when they get involved in politics, can be. One of the huge differences though is that Russians themselves have become very cynical and skeptical, but Americans are still pretty trusting and gullible, and so they keep getting hoodwinked and lead to believe that the tea Party was this completely spontaneous outbreak of protest. In fact the whole thing was guided by rich people to push their buck."


 Interestingly, the same thing ended up happening to post-Soviet Russia at the end of Curtis' blog - so-called "opposition" parties were set up by the Kremlin itself to give an illusion of opposition:
...Surkov created a modern and innovative way of managing the new democratic system - but in a way that his critics say has sidelined the mass of the people and completely diminished real democracy.

To do this Surkov created a constantly shifting political tableau. As well as being one of the architects of Putin's own party, United Russia, Surkov also allegedly helped to set up opposition parties the Kremlin could then use for their own purposes.

Surkov believes that the truth is that the idea of democracy will always be an illusion, that all democracies will always be "managed democracies" whether east or west. So the solution is for a strong state to manipulate people - so that they feel they are free, while they are really being managed.
So it looks like the Koch Brothers and Dick Armee took a page from Russia when they created the Tea Party. And notice that in both countries, when a true people's opposition emerged - Occupy in the U.S. and the marches in Russia following the sham election - they were both ruthlessly supressed by state power.

I recommend reading the DOE post too. Once you get over the illusion the "the people" who ever that is, has any sort of control over what's happening, you can make better decisions about your life. And speaking of sham democracy, here's a taste of what's going on here in Wisconsin:
MADISON, Wis. (AP) — Wisconsin's polarizing governor is fighting attempts to recall him with money from out-of-state donors, who helped him bring in more than $12 million since last year.

An Associated Press analysis of campaign finance reports Republican Gov. Scott Walker filed Monday showed 61 percent of the $4.1 million he raised during the five-week reporting period came from out of state.

Many of the contributions came from big donors, including $250,000 from conservative Texas financier Bob Perry and a total of $750,000 from three people in Missouri. More than half of Walker's money came from people who donated $20,000 or more, such as Michael Bidwill, president of the NFL's Arizona Cardinals, who gave $25,000.

Walker's latest efforts take advantage of a state law that allows targets of a recall to ignore the usual $10,000 per-donor cap and raise unlimited amounts until an election is set. Walker has been traversing the country raising money and speaking at gatherings of conservatives from Texas to New York and Tennessee.

"We haven't seen anything like this before," Mike McCabe, director of the government watchdog group the Wisconsin Democracy Campaign, said Tuesday. His group's analysis of Walker's latest fundraising totals, which covered Dec. 11 through Jan. 17, showed that 33 donors gave between $20,000 and $250,000 for a total of $2.3 million.
In fact, just four reactionary rich people  have donated over a million dollars. But here's the best part:
Walker's campaign spokeswoman Ciara Matthews said the level of donations shows Walker's message is resonating with voters.
Have you stopped laughing yet? His "message" is resonating with somebody all right, but I don't think most Wisconsin voters have $20,000 to contribute to Walker's relection, especially nearly half of Americans couldn't come up with 2,000 in an emergency.
Unlike Walker's donors, most of those funding Democrats — 67 percent — live in Wisconsin.

Democrats, who are bound by the state's campaign donation limits, have said they don't expect to keep up with Walker's fundraising.

"We will be outspent three or four to one," state Democratic Party Chairman Mike Tate said.
And if you're wondering who is going to call the shots in Wisconsin the next few years (assuming a Walker victory), here they are (hint: they don't live in Wisconsin):

Walker has spent $9.8 million over the past 54 weeks, with much of it going toward television advertising that started the night before those gathering signatures on recall petitions hit the streets. He reported having $2.6 million in cash left.

Some of Walker's biggest backers are well-known conservatives.

Bidwill is a frequent donor to Republican candidates across the country. Perry, a Texas home builder, helped pay for the Swift Boat Veterans ads that attacked Sen. John Kerry during the 2004 presidential campaign. Perry has a total of $500,000 to Walker's campaign.

The three others who gave Walker $250,000 each during one week this month were Missouri residents David C. Humphreys and his sister Sarah Atkins, both of Tamko Building Products, and Stanley M. Herzog of Herzog Contracting.

Members of the Humphreys family are some of the largest Republican donors in Missouri.
Yup, Walker's message is sure resonating with ordinary voters, isn't it? Aren't you glad you live in democracy?

UPDATE: According to the Journal Sentinel, Walker is outpolling most challengers.

Tuesday, January 24, 2012

1848 Again

Last year I (and many others) likened the Arab Spring to the revolutions of 1848 in Europe. Consider the similarities:

- A massive population increase, particularly of young people (thanks to new agricultural techniques).
- Economic disruptions caused by industrialization.
- Youth unemployment and radical philosophies (Marxism).
- Traditional ways of life under assault. Rapid technological change
- An increasing level of participation in the civic sphere, driven by increases in literacy and education.
- A demand for civil rights for ordinary citizens, including the right to vote.
- Authoritarian regimes where political participation is impossible. Monarchies are common.
- Repression of citizen uprisings by heavy-handed military by autocrats
- New communications technologies (the telegraph, sophisticated printing press, road networks).
- Mixed results (some success, some failure). A counterreaction from conservative forces.
- Short-term failures followed in the succeeding years by longer term fundamental changes in politics and economics.

A lot of these map onto the current Middle East quite nicely. In his latest column, James Howard Kunstler summarizes 1848, making the point that ideas tend to spread mysteriously when their time is due:

The spring of that year was an inflection point when discontent over the changes sweeping through European society broke into open insurrection in France, Prussia, Austria, Italy, Poland, South America, and other places all seemingly at once - despite the absence of television and the internet. However, the upheavals of 1848 occurred not long after the first practical installation of a telegraph line from Annapolis, Maryland, to Washington, DC (and then in Europe). It was also a time when the first railroad networks were linking up.

In February that crucial year, the liberal "Citizen King" Louis-Philippe of France was driven off the throne after an 18-year-reign characterized by tranquility and prosperity compared to the decades that preceded it. In March, street protests and violence spread through the grab-bag of kingdoms, dukedoms, and obscure principalities (Prussia... Saxony... Hesse... Fulda...) that would eventually make up the super-state of greater Germany. The Austrian empire began its slide into senility as its constituent states rioted. Even the people in Switzerland went batshit. And so on. Enter, stage left, Marx and Engels with a new political theory, for the excellent reason that the industrial revolution was reaching its stride and the conditions of daily life were changing very rapidly. Country people left farms for factory jobs all over the continent, and the ill-effects of the new wage-slavery drove them into solidarity. The uproar of 1848 was widespread and left many changes in its wake. But it was short and it produced odd instances of right-wing reaction.

In France, for instance, Louis-Philippe was sent packing (to England), and a new republic was established - but the president it elected was Napoleon Bonaparte's nephew, Louis Napoleon who, in a matter of months declared himself president-for-life, and then Emperor. He was not at all a bad ruler, as things turned out. Among other achievements, he presided over the massive physical renovation of Paris that produced the "city of light" beloved today. But he was driven off his throne twenty-odd years later from the ill effects of the opera bouffe known as the Franco-Prussian War.

In any case, the main point is that so many people across a continent got the same idea in the first weeks of a particular year, and then set about expressing themselves violently. More to my point is how things worked out in America. You have no doubt realized by now that there was no uprising in the USA in 1848 (though we did prosecute a war with Mexico). Yet, in the best Fourth Turning sense of history, a new generation had come of age and was producing the revolution in ideas that included Emerson and Thoreau's Transcendentalism, and the abolition movement, dedicated to ending slavery. This combination of broadly-held idealistic notions boiled away for another decade and led to the "mumuration" that precipitated the biggest bloodbath of the civilized world in the 19th century: the American Civil War. The Revolution of 1848 expressed itself most horrifically in the place that thought itself most specially insulated from its effects.
And by coincidence, the latest In Our Time podcast from the BBC also covers Europe’s year of revolutions: 1848: Year of Revolution. A good overview if you don't want want to wade through an entire book on the subject. The Wikipedia article is also a good summary.

The revolutions of 1848 were sparked by the disruptions that the birth of the industrial regime caused. It's likely that new revolutions will occur as the globalized industrial regime becomes unstable and collapses. One good comment to the Kunstler post linked 1848 with Britians Chartism movement, which seems to have some similarities to Occupy.

Monday, January 23, 2012

Happy Chinese New Year

Since it's Chinese New Year, I thought I'd post this link:

China: A Country Where No One is Secure (Caixin)

When a population is deprived of opportunity, disappointment abounds and people from all classes suffer the consequences

Sunday, January 22, 2012

Graphs to Ponder

In the long term, industrial civilization is a blip on the radar. Its internal contradictions are already tearing it apart.

And a quote to ponder, from Edward Abbey:

It should be clear to everyone by now that crude numerical growth does not solve our problems of unemployment, welfare, crime, traffic, filth, noise, squalor, the pollution of air, the corruption of our politics, the debasement of the school system (hardly worthy of the name ‘education’), and the general loss of popular control over the political process—where money, not people, is now the determining factor.

From this post, excellent, throughout:
The Faustian Bargain that Modern Economists Never Mention (Our Finite World)
The Faustian bargain goes something like this: Thanks to the discovery and exploitation of fossil fuels, humans (really just a small minority of them) are able to live richer lives today than even the queens and kings of yore could have dreamed of.

Furthermore, we’ve used some of those finite resources to increase food supplies and to expand the human population, which provides the economic system with both more workers and more consumers, a necessity to keep the economy growing under our current economic model. The world’s population increased from 1.6 billion in 1900 to 7 billion today, and we add about 80 million more each year. Humans have quickly become the most numerous megafauna on the planet.

The other side of the bargain, the side hidden from view and never mentioned in economics texts is this: At some undetermined time in the future, one that creeps ever closer, this economic system, fed by energy and other resources at ever increasing rates at one end and spewing out waste products at rates that cannot be absorbed by Earth’s ecosystems at the other, is unsustainable. What that means is simple enough: Industrial society as we know it cannot go on as it has forever—not even close.

Our economic system must exist within Earth’s finite limits, so recent and current generations have sold their soul to the devil for temporary riches, leaving the Devil to collect his due when the system falls apart under its own weight and the four horsemen of the apocalypse ride again across the world’s landscapes. None of this will happen tomorrow or this week or this year, but our economic system is faltering at both ends.

For many, if not most, of the world’s population life may become more difficult, incomes lower, and uncertainty greater. It does not mean the end of the world, as some predict for 2012, but it will mean that future generations probably will not live like current ones. Rather than admit that the current system cannot be sustained, the affluent and powerful will do everything possible to maintain the status quo.
Graph originally published in this article:
The Future Needs an Attitude Adjustment (Do The Math)

Saturday, January 21, 2012

Losing Democracy

People around the world are starting to realize that our economic system is incompatible with democracy. Around the world, democracy is being taken away, and governments are being turned over to creditors to be dismantled. Thus, we see that democracy was just a convenient fiction to mollify the people, but when push comes to shove, democracy gets shoved aside, and the real leaders take over. Case in point:
When the state stepped in to take over financially struggling Central Falls in 2010, Rhode Island's smallest city lost something fundamental: its democratic government.

Mayor Charles Moreau would be forced to give back his key to City Hall, and the City Council was relegated to advisory status — unsure for months whether it was even allowed to convene.

"They're being governed without elected representation," state Sen. Elizabeth Crowley said of Central Falls' 19,000 residents. "That flies in the face of the democratic principle that our country is founded on, not only our little city. Maybe we should have a tea party and dump some tea in the Blackstone" River.

Crowley, a Democrat and lifelong Central Falls resident, uses a twist on Abraham Lincoln's Gettysburg Address to describe government there, under a state-appointed receiver, these days: "of the receiver, by the receiver and for the receiver."

That receiver, former state Supreme Court Justice Robert G. Flanders Jr., is often criticized for sweeping like a dictator into a city he doesn't know, where he doesn't live and where, with the state's blessing, he unilaterally decides matters that go far beyond the fiscal.

The General Assembly passed the "Fiscal Stability Act" in direct response to Central Falls' financial crisis — giving the receiver authority to file for bankruptcy, which city officials did not have. It allows him not only to "exercise the powers of the elected officials" on fiscal issues but says his powers supersede theirs.
Troubled RI City in Receivership Loses Democracy

I like the last line of the article: "We may be in bankruptcy, but as far as I remember, I didn't lose my citizenship," she said. "Let's be very cautious about the rights that you're taking away from the governed." I wonder, how many cities are going to "lose democracy" in the decades ahead? Already the entire nations of Greece and Italy are being governed by similar unelected regimes, euphemistically (and incorrectly) termed "technocratic". And "democratic" cities around the country are becoming ever more repressive towards their citizens. Case in point: Chicago. I remember when Obama's chief of staff and former investment banker Rahm Emmanuel announced he was running for Chicago mayor. Well, "running" wasn't really accurate - it seemed to me like it was considered by all observers to be a fait accompli, with the actual election merely a formality. Why go through the trouble? And now former democratic strategist Rahm is implementing policies demanded by the financial elite, who are taking over the city for one of their conferences where decisions that affect us all are really made.

It's almost as if Rahm Emanuel was lifting a page from Naomi Klein's Shock Doctrine – as if he was reading her account of Milton Friedman's "Chicago Boys" as a cookbook recipe, rather than as the ominous episode that it was. In record time, Emanuel successfully exploited the fact that Chicago will host the upcoming G8 and Nato summit meetings to increase his police powers and extend police surveillance, to outsource city services and privatize financial gains, and to make permanent new limitations on political dissent. It all happened – very rapidly and without time for dissent – with the passage of rushed security and anti-protest measures adopted by the city council on 18 January 2012.

Sadly, we are all too familiar with the recipe by now: first, hype up and blow out of proportion a crisis (and if there isn't a real crisis, as in Chicago, then create one), call in the heavy artillery and rapidly seize the opportunity to expand executive power, to redistribute wealth for private gain and to suppress political dissent. As Friedman wrote in Capitalism and Freedom in 1982 – and as Klein so eloquently describes in her book:

"Only a crisis – actual or perceived – produces real change. When the crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function … until the politically impossible becomes politically inevitable."

Today, it's more than mere ideas that are lying around; for several decades now, and especially since 9/11, there are blueprints scattered all around us.
Read the whole sad story here: Outlawing dissent: Rahm Emanuel's new regime. On the pretext of policing upcoming G8 and Nato summits, Chicago's mayor has awarded himself draconian new powers (The Guardian)

On a related note, Treehugger's Sami Grover makes a good point here - when listening to a report about the economy, it listed the overthrow of brutal dictators who rammed through the neoliberal economic agenda as a setback!:
"The economy seems to be recovering, despite blips caused by the Arab Spring and the Fukushima Earthquake."

I almost missed the disturbing absurdity of this statement as I was listening to the radio the other day. Did I really just hear that the march of democracy is a threat to our economy, comparable to that of a horrific natural disaster? Sure, a giant earthquake that destroys communities, claims countless lives and disrupts supply chains can (and should) be seen as a major economic disruption. But a popular uprising against a murderous and brutal regime?

If the economy is supposed to be a measure of our well-being and development, we have a serious problem.
If the Economy Tanks When Democracy Advances, We Have a Serious Problem (Treehugger)

So are democracy and capitalism even compatible? In America, we've always been taught in a Pavlovian way to link freedom, democracy and capitalism. But they are unrelated. In fact, some would say they are antithetical! That's why I use the term authoritarian capitalism - there is nothing that says capitalism, especially the highly centralized corporate variety that straddles the world today - has to be under a democratic government. And now we're seeing democracy chucked out the window in the examples above. How long could our economic system last under actual democracy? And when are we going to stop pretending we have it?

Related: Why Are We Forced to Worship at the Feet of 'Mythical' Financial Markets Controlled by the Elite? (AlterNet)

Urban Focus

Freetown Christiania is a collectivist semi-autonomous settlement in of the world's major capitals where capitalism is rejected. It was created by squatters on a military base in 1971.
COPENHAGEN — Last summer, the Danish state offered to sell a good chunk of the 80-odd-acre former military base at the edge of downtown Copenhagen to Christiania, the alternative community whose residents had been squatting there illegally for four decades. For the residents, who fundamentally reject the idea of landownership, this presented an ideological quandary.

“Christiania has offered to buy it,” said Risenga Manghezi, a spokesman for the community. “But Christiania doesn’t want to own it.”

To resolve the contradiction, Mr. Manghezi and a handful of others decided to start selling shares in Christiania. Pieces of paper, hand-printed on site, the shares can be had for amounts from $3.50 to $1,750. Shareholders are entitled to a symbolic sense of ownership in Christiania and the promise of an invitation to a planned annual shareholder party. “Christiania belongs to everyone,” Mr. Manghezi said. “We’re trying to put ownership in an abstract form.”

Since the shares were first offered in the fall, about $1.25 million worth have been sold in Denmark and abroad. The money raised will go toward the purchase of the land from the government.
Free-Spirited Enclave’s Reluctant Landowners Fear Capitalism’s Harness (New York Times)

Also from the Times - Dismantling Detroit:
Detroit lost 25 percent of its population between 2000 and 2010, and now, broke, finds itself on the verge of a possible state takeover. Yet visual reminders of a better time both haunt and anoint the residents here. The past is achingly present in Detroit, and the way its citizens interact with the hulking, physical remnants of yesterday is striking.

A few years ago, there was a rash of power outages in Detroit, caused by people illegally cutting down live telephone wires to get to the valuable copper coils inside. The Detroit police created a copper theft task force to deter the so-called “scrappers,” young men who case old buildings for valuable metals, troll cemeteries to steal copper grave plates and risk their lives to squeeze any last dollar out of the industrial detritus.

One freezing evening we happened upon the young men in this film, who were illegally dismantling a former Cadillac repair shop. They worked recklessly to tear down the steel beams and copper fasteners. They were in a hurry to make it to the scrap yard before it closed at 10 p.m., sell their spoils and head to the bar.

Surprisingly, these guys, who all lacked high school diplomas, seemed to have a better understanding of their place in the global food chain than many educated American 20-somethings. The young men regularly checked the fluctuating price of metals before they determined their next scrap hunt, and they had a clear view of where these resources were going and why. They were the cleanup crew in a shaky empire. Somebody’s got to do it.
I imagine that this is just a preview of what the majority of urban areas in the United States will look like in twenty years' time. As William Gibson famously said - the future is already here, it's just evenly distributed yet:
A new report released Wednesday, to coincide with a U.S. Conference of Mayors gathering in Washington D.C., finds that only 26 of the nation’s 363 metropolitan areas had recovered the jobs lost during the recession by the end of last year.

Michael Cooper reports on the bleak outlook found in the study commissioned by the Conference, "It will take at least five years for the 80 hardest-hit areas to recover the jobs they lost."

The report comes as the country's mayors -- Democrat and Republican -- grow increasingly frustrated that the Federal Government, rather than providing cities with tools to improve their economies, have in fact cut many of the programs that cities have come to rely on to fund operations and improvements.

"Not only has Congress failed to overcome partisan gridlock to agree on a way to created much-needed jobs by spending more money on infrastructure, mayors said, but even the small sources of federal support that cities rely on — whether the Community Development Block Grants that were devised by Republican administrations in the 1970s or more recent federal programs that help struggling cities pay for more police officers or firefighters — are being scaled back as Washington has made cutting the deficit a priority."
Few Cities Have Regained Jobs They Lost, Report Finds (New York times)

Oh, and that's on top of thirty years' worth of deindustrialization and shrinking jobs. I suspect that many urban areas will never be developed, and some may even be depaved - dismantled and turned back into soil. As I wrote in this post, it's likely something similar happened after Rome's fall. One can imagine marble stripped from buildings and heated in ovens to produce soil amendments. In Cuba, abandoned urban lots were extensively depaved to create urban gardens. Another face of collapse:
Urban areas are great for increasing density and reducing collective resource use, but they're not quite perfect. The asphalt that covers so much of cities retains heat and is impermeable; it leads to stormwater pollution and is bad for air quality. Not to mention that every block of pavement is a block where plants can't grow.

Yet all over American cities, there are abandoned parking lots and public spaces that could be a lot more pleasant, and healthier, if it weren't for the layer of asphalt covering them. But one group is slowly taking back the land in an effort to create more green space and improve the local environment, by ripping up unwanted asphalt.

Depave is a Portland-based non-profit that organizes volunteer "depaving
Urban Depavers Return Parking Lots to Paradise (Treehugger)

Meanwhile, in Asia, the world's most populous country is now more urban that rural. How much longer can we keep cramming people into cities and depopulating the countryside?
Just over 680 million now live in cities – 51.27 per cent of China's entire population of nearly 1.35 billion.

Most have moved during two decades of boom in search of economic opportunities, and the historic mass migration from fields to office and apartment blocks ends the country's centuries-long agrarian status.

But the rapid modernisation and demand for improved living standards is piling extra pressure on society and the already blighted environment, experts claim.

With 75 per cent of Chinese expected to be living in cities within 20 years, the demand for more transport, energy, water and other vital infrastructure is set to test resources and city planners.

"Urbanisation is an irreversible process ... It will have a huge impact on China's environment, and on social and economic development," Li Jianmin, head of the Institute of Population and Development Research at Nankai University told reporters.
China's urban population exceeds rural for first time ever (Telegraph)

One quibble...urbanization is irreversible? So, people can't move back, ever? Does he know what's happening in Greece right now? Meanwhile, back in the U.S., affordable housing seems to be a faded memory:

Decline of affordable housing has many causes (Washington Post)

Reading such an article is maddening. It seems the economics of putting a roof over people's heads just don't pencil out. How is it that the magical "free market" can make a pencil with no guiding hand, but fail to provide the most basic of human necessities? Maybe the free market isn't the well-oiled machine we're all supposed all believe it to be. When millions of houses sit empty in a land ravaged by homelessness, I have a hard time believing resources are being allocated correctly.

Union Busting

You can kiss unions goodbye in America...along with any sort of worker rights.
UNLESS something changes in Washington, American workers will, on New Year’s Day, effectively lose their right to be represented by a union. Two of the five seats on the National Labor Relations Board, which protects collective bargaining, are vacant, and on Dec. 31, the term of Craig Becker, a labor lawyer whom President Obama named to the board last year through a recess appointment, will expire. Without a quorum, the Supreme Court ruled last year, the board cannot decide cases.

What would this mean?

Workers illegally fired for union organizing won’t be reinstated with back pay. Employers will be able to get away with interfering with union elections. Perhaps most important, employers won’t have to recognize unions despite a majority vote by workers. Without the board to enforce labor law, most companies will not voluntarily deal with unions.

If this nightmare comes to pass, it will represent the culmination of three decades of Republican resistance to the board — an unwillingness to recognize the fundamental right of workers to band together, if they wish, to seek better pay and working conditions. But Mr. Obama is also partly to blame; in trying to install partisan stalwarts on the board, as his predecessors did, he is all but guaranteeing that the impasse will continue. On Wednesday, he announced his intention to nominate two pro-union lawyers to the board, though there is no realistic chance that either can gain Senate confirmation anytime soon.
Crippling the Right to Organize (New York Times)

That's an old story from last year. I don't remember hearing about it in any other forum, ESPECIALLY televised "news". You would think the end of the right to bargain collectively would be sort of newsworthy, wouldn't ya? Guess not to the people that run the media. Meanwhile, at the state level:
Republican leaders in Indiana on Monday declared as their top legislative priority making Indiana a “right to work” state, setting the stage for a new battle over union rights that has already consumed many states. The proposal would prevent unions from negotiating contracts that would require workers to pay union dues.

The notion instantly set off objections from the state’s union leaders, who said the true aim was to weaken labor unions, and from Democratic lawmakers, some of whom had left the state for more than a month early this year in an effort to block similar provisions.

With an election year approaching, the Republican leaders’ decision to revisit the question places Indiana squarely in the center of a volatile political debate already playing out elsewhere. In Ohio, voters this month overwhelmingly repealed a law limiting collective bargaining for public sector workers, and in Wisconsin, a fight over bargaining rights has led critics of the state’s Republican governor to begin collecting signatures in the hope of recalling him from office.

“We must remove the last barrier to job creation in Indiana,” said Representative Brian C. Bosma, the Republican speaker of the Indiana House, who said the legislation would probably be considered when lawmakers met in January. “Time and again, those charged with bringing new jobs to Indiana have given us very specific evidence that at least a third to a half of businesses looking for where to move take Indiana off the table because we’re not a right-to-work state.”
Republicans in Indiana to Seek Law Limiting Unions (New York Times)

Last year the Tea party "revolution" that was funded by the Koch brothers decided en masse to smash unions at the state level, as evidenced by the battle against state employee unions here in Wisconsin (the recall effort is underway). It is often claimed that Nazi and Soviet regimes also smashed unions. In fact, they smashed independent trade unions. "Official" trade unions were allowed, so long as they were under the government's control. Even the great dictatorial regimes of the last century did not preside over a populace foolish enough to voluntarily accept lowered living standards by effectively eliminating the rights to collectively bargain entirely. No population has been that stupid until the modern-day United States. Then again, we were were stupid enough to stand by and watch as our entire industrial base was dismantled and shipped to China. I'm sure the corporate elites think they can get away with anything after that. The sad thing is, they're probably right.

Thursday, January 19, 2012

The Consumer Economy on the Verge?

Is the "Consumer Society", where people need to work ever harder to buy ever-more stuff to keep the economy "growing" losing it's appeal around the world?

Lloyd Alter:

Shopping malls are in trouble all over North America, as retailers fail, shrink or flee to the cheaper freestanding box stores. Many are changing from shopping to entertainment and services. One expert is quoted in the Montreal Gazette: “People are spending more on experience and service and less on stuff. The world is awash in ‘stuff’.”

Shopping Malls Changing or Closing Because "The World Is Awash In Stuff"

Naomi Wolf:
NEW YORK – As turmoil stalks America’s financial markets and protests fill its streets, Americans’ lifestyle choices are evolving in a telling way: once seen by the rest of the world as an exuberant teenager – the globe’s extrovert, exporter of rock ’n’ roll and flashy Hollywood movies – Americans are now becoming decidedly withdrawn, or at least inward-looking. Trends in leisure activities reflect that change: frugality and making do are in; gaudy consumerism is out.

This change is due to the fragile economy, of course, but I believe that it is also psychological. After two wars and a half-dozen undeclared conflicts in the past decade, America has entered a period of unprecedented cultural hibernation.

Gardening, scrapbooking, knitting, and cooking have all become newly, shabbily chic. In the urban neighborhoods to which the young and hip are moving, city garden plots and heirloom tomatoes grown in window boxes have replaced Lexuses and Priuses.

Other young hipsters have moved farther out into the country in search of an idyllic new narrative fantasy. The young couple – he with a beard and she in a sundress and rubber boots – are homesteading in the Hudson River Valley with a flock of chickens, or in New Mexico in an ecofriendly straw-bale house. They have replaced the young couple of five years ago – he with the hedge fund, she with interior decorators – in a McMansion in Westchester County.

The food sections of urban newspapers that, five years ago, would have covered the latest fusion cuisine, now run dreamy profiles of the guy with the Ivy League degree who has stepped off the grid, and done fine for himself by starting a line of homemade pickles. Farmers’ markets, wood stoves, solar panels, and Agway farm-supply stores are the new focus of aspirational dreams for people who not long ago were high on boundless credit, consuming luxury brands scaled down for the middle class, and fantasizing about the kind of life on display in glossy magazines.
Naomi Wolf: The American Hangover (Project Syndicate)

Rick Bookstaber:
And one notable area of consumption that by definition differentiates the classes, that of conspicuous consumption, is going by the wayside. Yes, I believe we are seeing the twilight of the era of conspicuous consumption. Not that Gucci and Chanel are going to go out of business, but for most people that sort of status statement is increasingly becoming irrelevant. No matter what you are wearing and driving, a far better picture of you and your status is just a few clicks away. You don’t have to drive a Ferrari to let everyone know you are rich and successful. If you are driving a Ferrari, what it will convey is that you – who as everyone who cares to Google you knows is running a hedge fund and is worth tons of money – must like a Ferrari.
The Bifurcated Society (Credit Writedowns)
Japanese companies are worried that herbivorous boys aren't the status-conscious consumers their parents once were. They love to putter around the house. According to Media Shakers' research, they are more likely to want to spend time by themselves or with close friends, more likely to shop for things to decorate their homes, and more likely to buy little luxuries than big-ticket items. They prefer vacationing in Japan to venturing abroad. They're often close to their mothers and have female friends, but they're in no rush to get married themselves, according to Maki Fukasawa, the Japanese editor and columnist who coined the term in NB Online in 2006.

[...]But it was the bursting of Japan's bubble in the early 1990s, coupled with this shift in the social landscape, that made the old model of Japanese manhood unsustainable. Before the bubble collapsed, Japanese companies offered jobs for life. Salarymen who knew exactly where their next paycheck was coming from were more confident buying a Tiffany necklace or an expensive French dinner for their girlfriend. Now, nearly 40 percent of Japanese work in nonstaff positions with much less job security.

"When the economy was good, Japanese men had only one lifestyle choice: They joined a company after they graduated from college, got married, bought a car, and regularly replaced it with a new one," says Fukasawa. "Men today simply can't live that stereotypical 'happy' life."

Yoto Hosho, a 22-year-old college dropout who considers himself and most of his friends herbivores, believes the term describes a diverse group of men who have no desire to live up to traditional social expectations in their relationships with women, their jobs, or anything else. "We don't care at all what people think about how we live," he says.
The Heribvore's Dilemna: Japan panics about the rise of "grass-eating men," who shun sex, don't spend money, and like taking walks (Slate)

Wednesday, January 18, 2012

Facts to Ponder

Via Marginal Revolution:

The U.S. median wage for 2010 was $26,363.

The average health care insurance premium today is over $15,000 and by 2021 it may be headed to $32,000 or so (admittedly that estimate is based on extrapolation).

Health care premia rose 63% over the last seven years.

Monday, January 16, 2012

Corporations and Wealth Concentration

I have some posts in the kitty, but I haven't felt like writing lately - and in particular right now because I've got my first epic head cold of the winter season. I saw this comment for this article and thought it was interesting. I have not confirmed the factual accuracy, however.

In 1860 the U.S. had the broadest distribution of wealth in history despite 10% being slaves. We went to war to fix that. Yet 25 years after a successful outcome to the war, wealth was more concentrated ever. Why? The invention of the limited liability corporation in 1862. Corporations are ownership collectives that massively shift bargaining power away from Employees. That gap narrowed only with collective bargaining. Collective bargaining withered in the 1980s.

The corporate structure makes it easy to concentrate wealth. With the rise of global corporation like WalMart, local economies were decimated in favor of corporations who could ship goods from all around the world. These underlying causes of wealth inequality are rarely discussed. On a related note, see this: Business leaders of today are not capitalists.
Let’s talk about the market economy, by John Kay, Commentary, Financial Times: ...Karl Marx never used the word capitalism. But after the publication of Das Kapital, the term came to describe the system of business organization which had made the industrial revolution possible. By the mid-19th century ... individuals or ... a small group of active partners ... built and owned both the factories and plants in which the new working class was employed... The economic and political power of business leaders derived from their ownership of capital and the control that ownership gave them over the means of production and exchange.

The political and economic environment in which Marx wrote was a brief interlude in economic history. ... Legislation passed in Marx’s time permitted the establishment of the limited liability company, which made it possible to build businesses with widely dispersed share ownership. ...

So the business leaders of today are not capitalists in the sense in which Arkwright and Rockefeller were capitalists. Modern titans derive their authority and influence from their position in a hierarchy, not their ownership of capital. They have obtained these positions through their skills in organizational politics, in the traditional ways bishops and generals acquired positions in an ecclesiastical or military hierarchy. ...

People do not know who owns their work tools because the answer does not matter. If your boss pushes you around, exploits you or appropriates your surplus value, the reasons have nothing to do with the ownership of capital..., ownership of the means of production and exchange matters very little.

Sloppy language leads to sloppy thinking. By continuing to use the 19th-century term capitalism for an economic system that has evolved into something altogether different, we are liable to misunderstand the sources of strength of the market economy and the role capital plays within it.