A Confederacy of Dunces
Friends
YET again it has become apparent, through the words of Professor Paul Krugman, that the so-called Nobel prize for economics is tantamount to a crime against humanity.
In his latest hallucinogenic reverie entitled “Debunking the Austerity Myths”, Mr Krugman provides a stilted but psychedelic explanation as to why throwing money at things is the way forward in resolving the world economic debacle. The essence of the ideas being put forward are that attempts at fiscal discipline are fanciful and that pumping in as much financial liquidity into an economy is the way to jump start things.
These ideas are part of the jaded and proven-to-be-catastrophic neo-classical economic ideas that have led us to the mess we are all in. No amount of juggling and unholy incantations from current economic theory with its sleazy manipulating of interest rates, taxes and government expenditure is going to give us any form of genuine recovery.
The point is that in a system that is stacked against the good of the planet, welfare of all forms of life and well being of any decent human being, whatever money that is strewn around -- even with best of intentions -- inevitably ends up in the hands of those who have been controlling the economic and behind-the-scenes levers in the first place.
The rest of us are always at the short end of a very sharp stick that is now finally being redirected to chasing out the money changers from our societies: or at least, one prays.
It is really quite clear that we have to sit some of these professors down, like Alex in A Clockwork Orange, and force them to watch a clip of Lady Gaga repeatedly explaining:
“Dear Bozos,
If you play a game of Monopoly* and expect to win and survive that game as it is played by its rules, then inevitably no matter what technique you use the only way to win the game is by bankrupting everyone else and being the sole monopolist on the game board. The entire purpose of the game is to wipe out the 'competition' and beggar your fellow human beings. It is designed to finally end once you own everything and have impoverished everyone else, so that there's no one left to play the game.
Similarly, when you extend this to society at large what happens is you tend to outsource your work for pittance -- and/or pay other workers you bring in much lower wages -- to sell your products at higher profit margins to....ah, we forget, you consumers are out of money so we need to increase credit/loans and get money siphoned into the system again otherwise we will not be able to repeat the whole cycle of crushing you back into poverty. Rock on.”
In the end, what Mr Krugman wants is what President Franklin Roosevelt succumbed to after introducing his New Deal measures to fight the Great Depression. It seems that getting involved in World War II was a good way to churn money about as massive spending is required when a country gears up for global military involvement.
Professorio Krugman doesn’t ask how exactly did America and so much of the world today get into the current economic rut in the first place. Perhaps excessive use of military involvement as an economic strategy to boost expenditure, and the use of fiat currencies that can be printed freely by governments have a lot to answer for.
It is no surprise that both Britain and the US want to exit from trouble spots their militaries are embroiled in, and that President Obama has cannily remarked that the world cannot depend on America buying everything up from their economies because it is time for fiscal discipline.
Be assured, sooner than later we will all return to a new gold standard which not only gives genuine value to a state’s currency but automatically results in fiscal discipline and, unsurprisingly, less military adventurism all round.
A close examination of ordinary people’s comments on how they survived the Depression in the US points to Roosevelt’s social security policies, the social resilience of the people, and to the fact that some people had enough savings for rainy days that turned into floods.
What most countries should do is not to take a populist approach of having a lax social security savings scheme while encouraging governmental spending binges. Nor should there be a regimen of zero interest rates to the point you just give away money and hope all will be well. This is precisely the kind of thing that will have disastrous consequences with significant devaluation of the currency, or inflation, that would leave many of us with a shredded safety net and money that is so utterly worthless since you cannot even recycle it as paper to write notes on.
Fiscal discipline and a new way of doing things among ourselves as in helping one another through difficult times, is the way forward. Some of these ideas for a new paradigm are explored in many of the earlier posts on this site.
Following the advice of Mr Krugman, who does not admit to the World War II spending scenario that is the underlying narrative of his rhetoric against so-called austerity measures, is like asking those on trial at Nuremberg to explain their point of view.
But World War II was their point of view. And some of us have had enough of that.
* Wikipedia states that “Monopoly is a redesign of an earlier game "The Landlord's Game" first published by political activist Elizabeth Magie. The purpose of that game was to teach people how monopolies end up bankrupting the many whilst giving extraordinary wealth to one or few individuals.”
“ ‘Whether it can be altered or not, whether it’s right or wrong landlordism is one of the causes of poverty…Poverty is not caused by men or women getting married, it’s caused by machinery; it’s not caused by “over-production”; it’s not caused by drink or laziness; and it’s not caused by “over population”. It’s caused by Private Monopoly. That is the present system. They have monopolised everything that it is possible to monopolise; they have got the whole earth, the minerals in the earth and the streams that water the earth. The only reason they have not monopolised the daylight and the air is that it is not possible to do it. If it were possible to construct huge gasometers and to draw together and compress within them the whole of the atmosphere, it would have been done long ago, and we should have been compelled to work for them in order to get money to buy air to breathe. And if that seemingly impossible thing were accomplished tomorrow, you would see thousands of people dying for want of air – or of the money to buy it – even as now thousands are dying for want of the other necessities of life. You would see people going about gasping for breath, and telling each other that the likes of them could not expect to have air to breathe unless they had the money to pay for it. Most of you here, for instance, would think so and say so. Even as you think at present that it’s right for a few people to own the Earth, the Minerals and the Water, which are all just as necessary as is the air. In exactly the same spirit as you say: “It is Their Land,” “It’s Their Water,” “It’s Their Coal,” “It’s Their Iron,” so you would say “It’s Their Air,” “These are Their gasometers, and what right have the likes of us to expect them to allow us to breathe for nothing?” [And even while he is doing this the air monopolist will be preaching sermons on the Brotherhood of Man; he will be dispensing advice on “Christian Duty” in the Sunday] magazines; he will give utterance to numerous more or less moral maxims for the guidance of the young. And meantime, all around, people will be dying for want of some air that he will have bottled up in his gasometers. And when your are all dragging out a miserable existence, gasping for breath or dying for want of air, if one of your number suggest smashing a hole in the side of one of the gasometers, you will all fall upon him in the name of law and order, and after doing your best to tear him limb from limb, you’ll drag him, covered with blood, in triumph to the nearest Police Station and deliver him up to “justice” in the hope of being given a few half-pounds of air for your trouble.’ ”
Owen opened his dinner basket and took from it two slices of bread, but as these were not sufficient, he requested that anyone who had some…give it to him.
‘These pieces of bread represent the raw materials which exist naturally in and on the earth for the use of mankind; they were not made by any human being, but were created by the Great Spirit for the benefit and sustenance of all, the same as were the air and the light of the sun.’…
‘Now…I am a capitalist; or…I represent the landlord and capitalist class…all these raw materials belong to me…the only thing that matters now is the admitted fact that all the raw materials which are necessary for the production of the necessaries of life are now the property of the Landlord and Capitalist class. I am that class…’
…‘Now you three represent the Working Class: you have nothing – and for my part, although I have all these raw materials, they are of no use to me – what I need is – the things that can be made out of these raw materials by Work: but as I am too lazy to work myself, I have invented the Money Trick to make you work for me. But first…These three knives represent – all the machinery of production; the factories, tools, railways, and so forth, without which the necessaries of life cannot be produced in abundance. And these three coins…represent my Money Capital.’
…Owen proceeded to cut up one of the slices of bread into a number of little square blocks.
‘These represent the things which are produced by labour, aided by machinery, from the raw materials. We will suppose that three of these blocks represent – a week’s work. We will suppose that a week’s work is worth – one pound: and we will suppose that each of these ha’pennies is a sovereign.
…‘You say you are all in need of employment, and as I am the kind-hearted capitalist class I am going to invest all my money in various industries, so as to give you Plenty of Work. I shall pay each of you one pound per week, and a week’s work is – you must each produce three of these square blocks. For doing this work you will each receive your wages; the money will be your own, to do as you like with, and the things you produce will of course be mine, to do as I like with. You will each take one of these machines and as soon as you have done a week’s work, you shall have your money.’
The Working Class accordingly set to work, and the capitalist class sat down and watched them. As soon as they had finished, they passed nine little blocks to Owen, who placed them on a piece of paper by his side and paid the workers their wages.
‘These blocks represent the necessaries of life. You can’t live without some of these things, but as they belong to me, you will have to buy them from me: my price for these blocks is – one pound each.’
As the working class were in need of the necessaries of life and as they could not eat, drink, or wear the useless money, they were compelled to agree to the kind Capitalist’s terms. They each bought back and at once consumed one-third of the produce of their labour. The capitalist class also devoured two of the square blocks, and so the net result of the week’s work was that the kind capitalist had consumed two pounds worth of the things produced by the labour of the others, and reckoning of the squares at their market valued of one pound each, he had more than doubled his capital, for he still possessed the three pounds in money and in addition four pounds worth of goods. As for the working classes…having each consumed the pound’s worth of necessaries they had bought with their wages, they were again in precisely the same condition when they started work – they had nothing.
After a while…the kind-hearted capitalist, just having sold a pound’s worth of necessaries to each of his workers, suddenly took their tools – the Machinery of Production – the knives – away from them, and informed them that as owing to Over Production all his store-houses were glutted with the necessaries of life, he had decided to close down the works.
…‘I’ve paid you your wages, and provided you with Plenty of Work for a long time past. I have no more work for you at present…[and the necessaries of life?]
…‘I shall be very pleased to sell you some.’
…‘Well, you can’t expect me to give you my goods for nothing! You didn’t work for me for nothing, you know. I paid you for your work and you should have saved something: you should have been thrifty like me. Look how I have got on by being thrifty!”
…and then the three unemployed started to abuse the kind-hearted Capitalist, demanding that he should give them some of the necessaries of life that he had piled up in his warehouses, or to be allowed to work and produce some more for their own needs; and even threatened to take some of the things by force if he did not comply with their demands. But the kind-hearted Capitalist told them not to be insolent, and spoke to them about honesty, and said if they were not careful he would have their faces battered in for them by the police, or if necessary he would call out the military and have them shot down like dogs…
‘Of course…if it were not for foreign competition I should be able to sell these things that you have made, and then I should be able to give you Plenty of Work again: but until I have sold them to somebody or other, or until I have used them myself, you will have to remain idle.’ ”
[At the end of all this the listeners all sing “For he’s a jolly good fellow,” and ask the kind hearted Capitalist if they can elect him to Parliament – or Congress, etc]
