By Jon Ronnquist
December 08, 2008 “Information Clearinghouse”
Many have quite rightly argued that the forces which drive the sink-or-swim free market economy are beyond any conventional means of containment. Like a cancer which fights for its own survival at all costs, including eventually the host itself, so does the free market economy feed without consideration for the clear boundaries of sustainability, tolerance and fairness.
This is exacerbated by the universal debt based system of finance, which narrows considerations of profit into ever shorter time spans, thus creating antipathy towards long term visions and factors beyond profit, such as negative impact and future repercussions. For those who have understood this all along, the current economic implosion is not only understandable, but inevitable. Any parasite which draws more from its host than the host can sustain, will eventually kill it, and so we have what we have today. In this case the host is the working man, upon whom the burden of debt has been allowed to grow beyond his ability to manage, thus forcing a collapse at the very base of the pyramid.
Continuing this analogy of disease, we can see something of considerable interest with regard to our current situation. Any disease could be said to be parasitic, in so far as it can only live and grow within the infected host. And all disease is ultimately terminated in one of two ways. Either the host, through its own agents or with the help of medicine or surgery, is expelled or killed. Or when such efforts fail, the host dies and the disease with it. Looking at the economy this way, we can quite easily compare it to a life threatening illness, a cancer of the nation so to speak. And here we are at the end of the cycle. Prudence, oversight, consideration and even public solidarity, could all be said to have failed. And now we find ourselves at a cross roads, which I for one, do not believe is anywhere near as clear cut as our trusted men of office might have us believe. Looking at the current course being taken by governments across the world, we seem to be racing to rebuild the very thing which brought about this disaster. And they are right in a limited sense. If we want to start the process all over again, credit must be made available again at all costs.
But is that what we really need? Even if a large majority of existing debt were simply wiped out, which it theoretically could be when you consider that the money borrowed never existed in the first place, it would not guarantee against a repetition of the cycle now coming to an end. If we start borrowing again, we will simply buy ourselves a little more time. Borrowing is as short sighted a solution as the desperate profit frenzy it predisposes us to. The fact that borrowing has been institutionalised among working people in the last few decades, does not mean it is either wise or prudent. Very few of the millions whose lives have been ruined by the burden of debt will insist they are better of for it. And as that number begins to increase dramatically, the true nature, and perhaps even intent, of large scale money lending is revealed. Debt is a trap, and like any trap, it was set in place by those who would profit to see it walked into. It is no coincidence that there isn’t anywhere near enough money, or even arbitrary value, in the world to pay all existing debts. And with the collapse of Wall Street and the billions in false value they have created over the years now disappearing like the smoke and mirrors it has always been, there is even less. A vast majority of those who owe, are stuck with their debt as a mathematical fact. And many more must rely on the continued borrowing of their debtors and clientèle to pay their own debts.
The idea that an object or institution can sky rocket in value without fundamentally changing, is a fallacy, albeit one which has made many people rich in the years of false optimism leading up to the current crisis. And the proof of that fallacy is the equally illogical way in which that value has now disappeared. How can the worth of a single stake in GM go from over $90 in 2000, to just under $4 in 2008, while the quantity, quality, usefulness, dependability and economy of its product remains effectively the same? The answer is that it can’t. At least not in reality. But as has been proven, cut throat capitalism and reality have very little in common. I myself have never bought stock for this simple reason, I find the gloating optimism of those who see their shares increase in value just as annoying as their mind numbing whimpering when it crashes. People who bought their house in the eighties love to brag about the difference between what it cost them and what it’s now worth, and seem oblivious to the fact that the house is no better or worse than it was and people who were unlucky enough to be born in the twenty first century have to sell their souls to get a home of their own. What we do see is home owners gambling with their new magically created “wealth” by borrowing against it while their incomes remain the same.
And what is the real effect of all this on the ground? Well, from where I’m standing, it looks like the number of people who aren’t too busy to stand up and do something about it is growing smaller everyday. If hypocrisy means blaming others for problems to which you yourself are a party, even if indirectly, then the list of hypocrites will soon dwarf those who are left standing at the picket lines or marching on the capital. And is all this just the luck of the draw? I think not. Bankrupt people are primarily useful in that they tend to introvert and feel voiceless and powerless. When it comes to gaining control, the thing to bankrupt is governments. And what do we see now? Just about every country in the developed world is being plunged into a whole new level of debt, as they borrow to save the very institutions that have colluded in the systemic strangulation of our economies, an act of propitiation and cowardice that should leave even the sceptics asking questions about who is really calling the shots.
The real problem is that those who have been riding the wave and now see the party ending, will instinctively want to keep the music on and the champaign flowing. If the average consumer was savvy enough to see the folly of this, we wouldn’t be in this mess in the first place. I wholeheartedly believe we should let the system die, hook line and sinker. Those who have bought into the false economy with the most reckless abandon will undoubtedly suffer. Many of the victims will be fundamentally innocent, guilty only of ignorance and perhaps turning a blind eye to that itch of the conscience which over indulgent consumers and borrowers do so well, myself very much included. But is misery really too high a price to pay for a chance at a future, if not for ourselves, than at least for our children and theirs? Or should we stake the entire future on a chance for a few more years of easy credit and false optimism? And let’s not forget that our fear of letting go of this daydream we have been living may be no more justified than our naïve belief that it was taking us somewhere worthwhile in the first place. The things upon which this society is built, the factories, the roads, the working man and woman, the minds that dreamed it all up, are not going anywhere. The technology to pull man out of whatever dark age a total collapse of the current system might create, exists and has existed for years, heavily suppressed by the vested interests which have fought so hard to maintain the status quo.
I would rather spend the next five years ploughing fields with an ox, than haggle with my bank over terms and conditions, if at the end of it I was dependant only on the rays of the sun, the rise of the tide, the blowing wind and a hard days honest work for my livelihood. If we could replace money as the catalyst of human endeavour with conscience, a few years without my plasma TV and MP3 player might just be worth it. Hell, I’ll just read more. Truth be told, much of what makes us happy, including technology, could be as easily, if not more so, available if it is removed from under the shadow of profiteering powers. The idea that financial profit is the catalyst of human advance is probably one of the most sardonic myths of the modern world. The creators of this world are not driven, only curtailed, by considerations of money. The great minds of these times, and others, were almost unanimously driven by higher and more honourably motives. Our current dependence on the system we have is such that any radical departure from it will almost inevitably lead to temporary chaos of one kind or another. Some cancers are too far spread to be removed at no cost. And yet to continue living with it is a guarantee of a slow and painful death, from which no recovery will be possible.
The environment for one, is at it’s peak of tolerance for the rape it has suffered under successive generations of profit driven plunder. Even a short resurgence of the system as it now exists would almost certainly mean irreversible damage, if that is not the case already. The standard of living to which the Western world has in most part become accustomed is not very high and is not remotely as egalitarian as existing technology would allow, and yet it is grossly above our means within the framework in which it is being provided, both in financial and environmental terms. Many, if not most, falsely believe that current unsustainable methods and sources will be phased out by technology in the hands of contemporary industry and government, but if this were true, much of it would have happened a long time ago. The drastic advances and the infrastructure they require will not be made at the behest of human needs or environmental concerns, but only as a consequence of non profitability, as resources become prohibitively scarce. The problem is that by the time that day comes, it will be too late and any chance of making the necessary changes will be gone. It is time we take our future out of the hands of those who see only tomorrow and place it in our own hands and our vision of a better century. One of the ways to do so is to resign yourself to the need for some things as we know them to end, even some we have come to regard as indispensable, and in our arrogance, ours by rights. If we cannot do that, then perhaps we will get what we rightly deserve. Although in all likelihood, it is our kids who will be footing the bill, perhaps even with their lives.
FAIR USE NOTICE: This blog may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.
Pingback: Obama stimulus boosts markets « Dandelion Salad
Pingback: Capitalist Fools by Joseph E. Stiglitz « Dandelion Salad
Great analogy and thoughtful analysis.
Pingback: Debit, credit, banco! By Rudo de Ruijter « Dandelion Salad