A fellow ‘Twittererer’ wonders how he can get a handle on understanding modern economics. He used the expression, ‘Economics for Dummies’. My advice is simple: Forget understanding economic theories. Know what is right and just for the common good. After that most things fall into place.
Follow that principle and you come to the inescapable conclusion food banks are an abomination, their use now at a record high. You feel sick at learning the boss of an oil company has a salary of £14 million, both indication not of a caring society, but of a wealthy society that has lost its way.
I have the barest of expertise in modern economics. Then again – and this might come as a surprise – I share that lack of expertise with the UK’s Chancellor of the Exchequer. Yet, mysteriously, counter to all previous successful economic doctrines austerity is the ‘cure’.
The cure is, of course, getting robbed a second time, the first when craven politicians handed the nation’s funds to venal banksters. It’s a false doctrine, bereft of imagination and empathy for the poor and the vulnerable, a neo-con creation. It promotes the creed of sucking wealth from the grass roots to the top of the tree. The consequence is the tree dies off at the roots. It is brazenly based on greed.
Study some Scots philosophy
A grounding in philosophical ideas will bring the student to the great economist of last century, J.K. Galbraith, (of Scottish descent) and then to our own Adam Smith, and John Stuart Mill. At that point you perceive how far neo-liberal economists and their disciples have corrupted Adam Smith’s doctrines, thoroughly misrepresenting his theories for their own selfish ends. Were he around he’d be shocked at how his ideas are betrayed.
Milton Friedman, the late American economist, so loved by Reagan and Bush, expounded the lethal dogma that has all but bankrupted nations, killing thousands of people and placed millions more into poverty and perpetual debt, subjected to its brutal imposition.
Democracy is the casualty.
It will take a decade or more to rescue civil rights from the grasp of the power elite.
On my desk still to read is ‘And The Weak Suffer What They Must’ the latest book by today’s anti-austerity guru, Yanis Varoufakis. I doubt I’ll get to Thomas Piketty’s tomb, ‘Capital In the Twentyfirst Century.’ By all accounts the impact of the French professor’s book has annoyed the living hell out of lovers of laissez-faire economics and minimum regulation, that is, minimum constraints on the rich, maximum on the rest of us.
We take extreme capitalism as normality
If my guardian was alive today she’d be shocked to see how almost everything has been given a monetary value. We used to laugh at the tins of ‘Edinburgh Air’ sold to stupid tourists, (open and sniff) now almost everything has a price. Today, you can sell a place in a queue. Want to queue jump? Pay £100 more to jump to the head of the line.
Got a dim son or daughter and want them to have a university education? Pay inflated fees per term and your progeny will be chosen before a place is made available to a genuinely intelligent adolescent from a poor home. Want to shoot an endangered rhinoceros more than a common one? Pay the extra £150,000 and the animal is yours to kill, trophy photograph extra. Rent space on your forehead. That’s no joke. Air New Zealand paid thirty people to shave their heads and tattoo “Come to New Zealand”. If you have a space on your car use it to generate revenue. Want to insure your ailing mother? Pay the premiums, and collect the insurance when she dies, more if you state the year accurately.
Betting on death is calculated to generate an industry worth £25 billion a year.
Anything can be packaged and sold, even theories, street names, and debt. But sticking a price on anything and everything is corrosive. Our sense of values get skewed. We can even sell-on debt to another individual, and the person owing the debt is effectively cut off from the conditions he signed up to.
And the same items and commodities can be outsourced leaving your own country bereft of industry and services, and that means jobs. Think of the proliferation of for-profit schools, private security companies, private armies, and private hospitals. Private military contractors greatly outnumber US and UK military in Iraq. Private security in the UK is thought to rival the number of Bobbies on the beat.
In all cases the motivating reason is profit
Some of it you can put down to greed caused by the bonus culture. You get paid handsomely for the work you do but if you fake the figures, pretend you worked harder than normal, got better results than last month, you get paid a large bonus too.
Some of it is down to what bosses do naturally, what they’re paid to do, ignore the community, the environment, and go straight for the profit. You outsource to avoid unions and minimum wages and conditions. And we take it all for granted.
Margaret Thatcher called it the triumph of the market.
We know the malaise better in the saying, ‘Every man has his price.”
Not a market economy
We are no longer a market economy, returning profit to the community for the common good, we are a market society.
Want to be a composer, a jazz musician, a painter, a nurse, a teacher, or god forbid, an essayist! – and not do it for the money? Why, you must be mad, or scrounging off the state. Chill out. Forget it. You can buy art off the shelf in IKEA. Why encourage a budding artist to live in a garret studying colour and composition?
Putting a price on everything corrupts and degrades.
Humans used to have a monetary value. They were called slaves. It can’t be insignificant that in our age we have seen a massive resurgence of slavery in the form of women held against their will sold for sex or house cleaning, and men for labouring without any hope of escape. Slavery is with us again, and just as profitable, assuming you don’t get caught.
How did we reach this perilous state?
Studious, politically aware readers will know the origins of neo-liberalism. It began as neo-conservatism, (neo-con) when an Austrian Jewish exile, Friedrich Hayek and a few pals, determined that the welfare state was akin to nasty authoritarianism. They really believed it was a branch of communism, fascism and Nazism. (You can read the same crapology in basic form repeated daily on chat sites spouted by unionist trolls.) His ideas were taken up by an American novelist called Ayn Rand, of whom the more I read the more I am certain ought to have been certified. She coined the phrase “greed is good”.
Rand simply encapsulated our aggressive and acquisitive instincts and turned them into a pseudo-philosophy.
Until then neo-conservatism was no more than a sack of eccentric economic ideas. She dumped the altruistic motive. Economists could become morally devoid and not feel guilty. Let smart people make as much money as possible for it will enrich the rest of us. She removed virtue from civic pride and ascribed it to creating wealth. She was not interested in the noblest of human emotions.
Friend and disciple of the ludicrous Rand, Alan Greenspan was chairman of the US Federal Reserve, a man who looked after the US’s banks and investment houses, the man almost solely responsible for relaxing regulations on banks and finance institutions. Retired now, he enjoys a six figure pension.
What pension are you getting?
Greenspan thought bank staff so trustworthy, so honest, that freed of constraint they would stay on the straight and narrow. He removed the tight grip on speculation. The banking community worshipped him. They were free at last. They had spent over $300 million on convincing governments to remove their chains. Under his watch neo-conservatism was softened to become more palatable to the masses – neo-liberalism, by this point raised to a phony philosophy as espoused by the brutal economist, Milton Friedman, part of the Chicago School of Economics.
A fantasy system
In no time at all a fantasy economic system became the guiding doctrine of the IMF, the World Bank, and western society. The confidence trick of trickle-down economics was born. Then came the inevitable collapse of the banks in 2008.
Trickle down economics can be summed up as follows:
Feed best oats to a horse and hope what comes out the other end feeds the rest of us.
After the collapse of 2008, the US Federal Reserve invested more than $15tn to save the banks under the guise of monetary stimulation. Here in the UK, Gordon Brown and his successor as chancellor, the lickspittle Alastair Darling, stole tens of billions from the public purse to rescue our banks from their disasterous speculations.
Meanwhile, 80% of the population remain caught in an artificially created recession, exacerbated by vicious austerity policies of a neo-conservative government that would make Thatcher wince.
Poverty is at its highest level since the 1930s. Almost a third of all children live with families subsisting below the poverty level. Food banks proliferate. Millionaires and multi-million dollar corporations secrete their money in far off tax havens to dodge their civic duties, while thousands of tax inspectors chase a few welfare cheats.
What can we do to turn things around?
Whip banks back into a state of fear of sanction. Reinstate regulation. State categorically the maximum risk any bank can operate. Ensure banks keep a minimum emergency fund, and build for a secure future. Investor banks should have constraints on how much of their client’s money they can risk at any one time.
Split up banks that are speculating with depositor and government funds. Commercial banks should return to lending fairly and carefully to help create a foundation for future growth. Commercial banks should return to serving us the public, offering low-cost mortgages, and lend money at fair rates.
Courts should imprison corrupt and inept bank executives not just fine them.
That omission is the most acute reasons for the rapid decline in public trust of politicians. Company bosses should have their annual salaries docked. The bonus culture should be thrown out. You get a fair day’s pay for a fair day’s work. Tax havens should be closed down, or if not a British protectorate, given the US-Cuban treatment and blockaded.
Ensure you vote for a candidate that has NOT been bought and paid for by a company or corporation. Union levies for one particular political party should cease, and workers allowed to join any political party they so choose. All lobbying of government must be open and recorded for public scrutiny. Those tasks are enough to get started.
We have to stop inveighing against the greatest heist in human history, the power and political elite stealing the nation’s wealth that we have created. We have to tell our politicians they serve us, not themselves. We have to make clear to businessmen they are not gods, or super-clever, they are weak, greedy men who pay themselves gargantuan salaries. We need to teach them moral conviction.
The free market is a delusion. It has collapsed. Demand social justice and social democracy restored. We must strangle the rancid, pus-ridden doctrine, ‘everything is up for grabs’.