'The Rich and the Great Recession'

Mark Thoma extracts from 'The Rich and the Great Recession'.

Our results suggest that the standard narrative of the Great Recession may need to be adjusted. Housing played a role, but so did financial assets, which actually accounted for the bulk of the loss in wealth. The middle class played a role, but so did the rich. In fact, the rich now account for such a large share of the economy, and their wealth has become so large and volatile, that wealth effects on their consumption have started to have a significant impact on the macroeconomy. Indeed, the rich may have accounted for the bulk of the swings in aggregate consumption during the boom-bust.

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This is one of the consequences of the concentration of wealth. The other is the paucity of ideas within the ruling class.

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Dead ends or building blocks?

Chris Dillow writes that policies can be either Dead ends or building blocks?.

We are not going to get a liberal socialist society merely by electing the right government: the Independent's otherwise fascinating "If I were Prime Minster" series misrepresents the nature of politics. But it is possible to gradually — perhaps even imperceptibly shift towards one. We've got ourselves a plutocratic managerialist society without consciously choosing one. Maybe we can get ourselves a socialist one the same way.

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Dillow is wrong to think the plutocracy was an unconscious choice. It is a consequence of the Laws of Motion for Capitalism: wealth is concentrated in the hands of the more successful Capitalists.

We cannot create a Socialist society through stealth: the Capitalists are too smart for that to happen. Let's not forget that they are very successful class warriors. They do not depend on luck for their success. They are very conscious of what drives a Capitalist society and the political processes that support it.

The only proven way to advance to Socialism is through the development of the political and cultural consciousness of the working class—not just the vanguard. We must realise ou potential to accept the responsibility of creating a freer society.

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A bird in search of a cage

Seth Godin writes that we tend to be A bird in search of a cage.

So much freedom, so much choice, so many opportunities to matter.

And yet, our cultural instinct is to find a place to hold us, a spot where we are safe from the responsibility/obligation/opportunity to choose. Because if we choose, then we are responsible, aren't we?

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This is one of the main cultural road-blocks that we must overcome in order to advance to a Communist society. We need people to accept the responsibility that freedom brings.

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Syria: Why Rojava is different

Jemma Nott explains Why Rojava is different.

With the odds stacked against them, the YPG and YPJ have taken back 20 towns from the IS in the past year — which is a greater achievement than the Levant Front, Hazzm Movement and Al-Nusra put together. What sets Kobane apart from other fighting militias is that their fight is more ideological than it ever will be physical — a fight not just for the liberation of Kurdistan or Syria but a fight for human liberation.

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A superior politcal and economic system has a good chance of prevailing over an inferior one because the former is able to mobilise and deploy resources is a better and more focused manner.

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Give the people what they want

Seth Godin says not to Give the people what they want.

Or you can dig in, take your time and invest in a process that helps people see what they truly need. When we change our culture in this direction, we're doing work worth sharing.

But it's slow going. If it were easy, it would have happened already.

This is want the political work of a Communist party is all about. It is getting people to see a new and different way of organising society, instead of just making changes to the existing Capitalist system.

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Anti-business

Chris Dillow argues that we should all be Anti-business.

But why do bosses have such influence? Partly, it's because politicians have so little credibility. But there are also two other reasons.

One is that the media — and the BBC is as guilty as anyone — sets up bosses as being general purpose experts: their opinions on the wider economy are often reported as authoritative in the way that others are not. This, though, misses the point that businessmen are at best experts only at running their own businesses — or in Stefano Pessina's case, inheriting them — and often not even that. As fans of many football teams will tell you, an ability to run one business often doesn't imply an ability to run another.

Also, bosses have managed to mythologize themselves as heroic, risk-taking leaders. But as we saw when Citylink collapsed, this is a fiction: it is workers and small contractors who bear risk, not big businessmen.

"Business leaders" are rather like corrupt medieval clergymen: they use an ideological fiction as a means of extracting wealth and power. What we need is a Martin Luther or Thomas Cromwell.

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This is all part of the ideological superstructure of Capitalism: the creation and maintainance of the myth about the importance and relevance of business leaders to the health of the economy and politics.

As we have found out in Australia, we have a buffoon called Clive Palmer who tried to buy himself into politics. Here is a billionaire who thought he could take over the Australian government by spending money lavishly. But he ended up with one (1) member in the lower house (himself) and three (3) senators. One of these has since become independent because she started thinking for herself.

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Nestles Has First Ever Negative Interest Corporate Bond; Privilege of Lending Gone Mad

Mike Shedlock is aghast that Nestles Has First Ever Negative Interest Corporate Bond; Privilege of Lending Gone Mad.

Yes indeed folks, you can can now pay Nestles for the privilege of lending it money.

What madman suggested that Capitalism was rational?

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Speak out against assassination attempt on Batay Ouvriye’s Yannick Etienne!

Stephanie McMillan asks everyone to Speak out against assassination attempt on Batay Ouvriye’s Yannick Etienne!.

The Rapid Response Network stands in solidarity with our sister, who has been a steadfast and courageous organizer for decades, at great personal risk and sacrifice. Batay Ouvriye is a rarity in this world: a genuinely autonomous and combative workers organization, and we will not stand by and allow collaborationist thugs to harm its militants!

Yannick belongs to the struggle, belongs to the entire international working class. Anyone who faces her with violence, will have to face all of us!

We Stand in Solidarity with the International Working Class!

We exhort our friends and sympathizers to also denounce this act internationally, and put CNOHA on notice that they will not get away with harming Yannick!

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Workers need to be actively mindful of the international struggle going on.

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Is democratic Keynesianism possible?

Chris Dillow asks Is democratic Keynesianism possible?.

In this sense, I read Simon as making a very radical claim — one which is more Marxian than Keynesian. "Democratic" policy-making cannot serve the public interest, because it is subverted by capitalists' interests. This represents a challenge to naive social democracy, which thinks that governments can do the right thing if only they have the will and courage.

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Dillow is correct in saying that the state exists to serve the interests of the ruling class. Under Capitalism, the ruling class consists of Capitalists. Thus, the Capitalist state serves and protects the interests of the Capitalists.

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Is ISIL’s ‘Shock and Awe’ more Awe-ful because One Victim?

Juan Cole asks Is ISIL’s ‘Shock and Awe’ more Awe-ful because One Victim?.

I think a lot of the ‘destroyed’ troops were burned up alive.

The purpose of the bombing was to terrify Iraqis into submitting. That is, it was a form of state terrorism. Iraq had not attacked the US. There was no casus belli or legitimate legal grounds for war. The UN Security Council, despite wooing and arm-twisting by Bush officials, declined to authorize the use of force. It was an illegal act of unadulterated aggression with no obvious provocation that led to the deaths of hundreds of thousands of Iraqis, the wounding of millions, and rendered four million of the 25 million Iraqis homeless over time (many of these remain displaced to this day; some have thrown in with Daesh as a result).

The US shock and awe campaign failed to shock or awe. The Iraqi military turned guerrilla and harried US troops for 8 1/2 years, then many of the ex-Baath officers and trained soldiers deserted secular nationalism, turned to al-Qaeda-type ideologies, formed Daesh and took over western and northern Iraq and eastern Syria.

The ex-Baath officers learned from seeing their colleagues and troops burned up by the Bush fireworks. According to that doctrine, you want to shock the enemy with your brutality and destructiveness, and awe him into submission by your crazed irrationality. But the Daesh commanders also took the lesson that dropping 15,000 pound bombs in the dead of the night away from cameras isn’t very effective, since the populace is insulated from the horror. Burning up even one captured enemy pilot alive on video, in contrast, would be broadcast by the internet and by Rupert Murdoch to the whole world, and a few thousand thugs could arrange for themselves to take on global importance and appear truly menacing to Jordan and even to the city of Rome (so they claim). All this publicity and fear accomplished not with billions in military spending but a smartphone camera, a single captive, and a few psychopaths with matches.

Now that is Shock and Awe. Shocking in its fierce savagery, awing in its wanton inhumanity. But we shouldn’t forget that that was also what Bush was going for in 2003 when he inadvertently started the process of creating Daesh as a backlash to his own monumental ruthlessness.

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When the US military burns people alive with their bombs (conventional and nuclear), flame-throwers, and depleted uranium shells, they claim that it is justified. The victims just become a statistic to be forgotten as “collateral damage”.

Both ISIL (Daesh) and the US military are monsters. One cannot be morally acceptable while the other is a pariah.

The answer is, of course, based on the fact the US military protects the Capitalists. Thus, all actions of the US military are morally justified from that point of view.

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Socialists and World War I: Turn the imperialist war into a civil war

Doug Enaa Greene writes about Socialists and World War I: Turn the imperialist war into a civil war.

And as opposed to fellow revolutionaries such as Trotsky, Bukharin, Rosa Luxemburg and Karl Radek, Lenin was able to see the potential for anti-colonial national liberation movements to bring capitalism to its knees. Lenin scoffed at those revolutionaries who saw the revolution where “one army lines up in one place and says, “We are for socialism”, and another, somewhere else and says, “We are for imperialism”, and that will be a social revolution!”

Rather, Lenin had a much more dialectical view of the possibilities for revolution. He believed that revolution would not strictly confined to workers against capitalists in the heartlands of capitalism, but that:

The revolutionary movement in the advanced countries would actually be a sheer fraud if, in their struggle against capital, the workers of Europe and America were not closely and completely united with the hundreds upon hundreds of millions of 'colonial' slaves who are oppressed by capital.

And too many sections of the left, even those who proclaim fidelity to Lenin forget these words:

To imagine that social revolution is conceivable without revolts by small nations in the colonies and in Europe, without revolutionary outbursts by a section of the petty bourgeoisie with all its prejudices, without a movement of the politically non-conscious proletarian and semi-proletarian masses against oppression by the landowners, the church, and the monarchy, against national oppression, etc.—to imagine all this is to repudiate social revolution.

This perspective of Lenin would guide the Bolshevik Party during the Russian Revolution of 1917 — which was not just the overturn of Tsarist Absolutism and feudalism along with being the world's first socialist revolution — one of history's most successful anti-war movements.

Lenin, and other socialists and communists, were in a minority in their opposition to World War I — they were imprisoned, denounced and killed by the imperialist rulers and their social democratic lapdogs. Yet we should remember this — it was Lenin, Liebknecht, Luxemburg, and all the others who were proven right. They were correct to not only oppose the war, but to expose the system that spawned the slaughter and to organise to bring capitalism down. On this centennial of the First World War, we should remember their struggles, sacrifices and lessons.

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We, workers, should not be dogmatic about how a social revolution develops; but, rather, be open to anyone who agitates against the current system.

However, there is definitely a problem of working with avowed racists, sexists, xenophobes, and homophobes. For these people, by their nature, are not for an inclusive society of equals.

On the other hand, working with people who are ignorant of their racism, sexism, xenophobia, and homophobia, enables an open discussion about such issues when they interfere with political action and debate.

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Who’s Unreasonable Now?

Paul Krugman asks Who’s Unreasonable Now?

OK, so as I understand the latest from the new Greek government, Yanis Varoufakis is saying that he and his colleagues don’t care what happens to the headline value of the debt — if you want to claim that there has been no write-off, OK. What they want instead is substantive but not outrageous relief from the burden of running primary surpluses (surpluses ex interest payments), reducing the amount of resources transferred to creditors from 4.5 to 1-1.5 percent of GDP; they also want flexibility to achieve these surpluses with a mix that includes more revenue and less spending austerity.

This is a dastardly ploy by those left-wing radicals. You see, it’s completely reasonable.

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What was reasonable for a Capitalist economist to propose last century is now considered to be radical now. This is how far the politics of Capitalism has drifted to the right.

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Obama’s new Cuba policy: McDonald's in Old Havana?

Marce Cameron examines Obama’s new Cuba policy: McDonald's in Old Havana?

What is clear is that restoring US-Cuba diplomatic relations and lifting the blockade will not, in and of itself, allow US corporations to dominate Cuba once again. Nor will it trigger a wave of privatisations of Cuba’s socialist state property, or an end to Cubans’ constitutional right to health care and education at all levels free of charge.

That would require the demolition or degeneration of two institutional pillars of the revolution: the Cuban Communist Party and the socialist state it leads. That is precisely what the blockade has failed to achieve.

The failure of the blockade to destroy the revolution — and Obama’s decision to act on the recognition of this failure — should be seen for what it is: a triumph of Cuba’s working people over half a century of brutal siege by the mightiest empire in history. Rather than recognise this inconvenient truth, Obama repeated the myth that the blockade has failed to bring about Iraq-style regime change because it has “provid[ed] the Cuban government with a rationale for restrictions on its people.”

The myth that the revolution is propped up by the blockade is widespread among both liberal critics and admirers of socialist Cuba. In reality, the blockade has failed to bring about regime change for two fundamental reasons: millions of ordinary Cuban citizens remain deeply committed to the revolution’s core principles; and the calibre of Cuba’s communist leadership. Obama wasn’t going to congratulate his adversaries.

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Capitalists regard their system as superior to all others. They think that people turn to Socialism, Communism, or Anarcharism out of simple ignorance. They cannot comprehend that communal control of the means of production is even possible, let alone superior to Capitalism despite the mounting evidence.

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Anti-feminist actor sparks protests by pop culture community

Leela Ford writes that Anti-feminist actor sparks protests by pop culture community.

[Adam Baldwin] has continued to use the hashtag [(#gamergate)] for other tweets promoting the idea that feminism is trying to destroy male gaming culture, among other things. The hashtag became popular among sections of the gaming community who were taking up the cause of a movement that Baldwin claims is about "ethics in games journalism".

However, the movement turned very quickly into a misogynistic attack on women in the gaming industry after a number of feminist critiques were released exposing sexism in the industry.

Baldwin proceeded to tweet personal information of Quinn and another game developer Brianna Wu, which was used by his supporters to send threats to the women. Baldwin then accused Wu of lying about being driven from her home amid safety concerns. He also accused another woman, Anita Sarkeesian of being hysterical after receiving messages threatening violence and rape.

Wu has publicly supported the petition by spreading the link on twitter while calling Adam Baldwin a “sexist bully”. She also tweeted her own feelings on the issue saying: “Something geek culture is struggling with is making the culture open to women. I think Adam Baldwin is the complete opposite of this goal.”

Baldwin is a self-professed conservative who prides himself on speaking up against what he believes are “social justice liberals” trying to silence his “dissent” and “destroy [his] personhood”. In another one of his Twitter crusades last year, he said that gay marriage would lead to incest for tax benefits.

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Feminism is a credible threat to to the patriarchy as it should be. Exposing sexism is a vital task for feminists. Without debate around what constitutes sexism, feminism cannot advance.

Those who derive their identity from the patriarchy are rightly threatened by this exposure. Thus, they respond by the only means they know how: threats of rape and other violence. Then they are dismayed when their apparently “normal” behaviour is called out as vile and reprehensible. This is how the patriarchy has always responded.

Again I reiterate my thesis as expounded in “I am not Charlie Hebdo”—freedom of speech is not an absolute right. Those, like Baldwin and the rest of the #GamerGate community, do not have freedom of speech because they are using speech to threaten and oppress others. While those, like Wu and Sarkeesian, do have the right to free speech because they are fighting against the oppression of the patriarchy.

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Massive swing to ALP in cliffhanger Queensland election result

Margaret Gleeson writes that Massive swing to ALP in cliffhanger Queensland election result.

Two of the newly elected ALP members are indigenous, one being the first indigenous woman elected to the Queensland Parliament.

Voters sent a clear message to the LNP and the ALP that privatisation of public assets will not be tolerated. Since assuming office the Newman Government has been plagued by community and union campaigning against privatisation and cuts to government services. Anna Bligh's Labor government lost to the LNP three years ago on this issue. The electoral backlash against privatisation led to the ALP being reduced to a rump of seven in Parliament — which by-elections later increased to nine.

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This is the danger of democracy for the Capitalists—the people oppose the plans of the Capitalists. Here, privatisation was supposed to be a bonanza for the Capitalists, but the people have other ideas.

The same thing happened in Greece: austerity was supposed to save the Capitalists, but the Greeks saw the horrendous effects and wanted nothing to with austerity.

There is definitely a rupture between the interests of the people and the interests of the Capitalists.

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Micro efficient, macro inefficient

Chris Dillow discussees whether Capitalism Micro efficient, macro inefficient, or not.

One might add that Marxists' main complaint against capitalism is that it is macro inefficient rather than micro inefficient. Their beef isn't so much that capitalism produces too much of one one good and not enough of another, but rather that it had a tendency towards crises; that it is exploitative and alienating; and that it has unpleasant cultural effects, for example by leading us to regard others with greed or fear which, Cohen says (pdf), "are horrible ways of seeing other people." These are all macro problems, not micro ones.

Again, this is not to claim that capitalism is wholly micro efficient; leftists believe that markets over-supply finance, weapons and pollution and under-supply more caring occupations - though whether these are state failures or market failures is moot.

All this poses a question. What sort of economic system does the idea of micro efficiency but macro inefficiency lead to?

We can discount the social democratic option. We know now — as Keynes did not — that macroeconomic policy within market capitalism is not sufficient to create full employment, perhaps for reasons identified by Kalecki or perhaps because capitalists capture the state; still less does it solve the faults alleged by Marxists. Nor am I attracted to the participatory planning of the sort advocated by Robin Hahnel; it seems like using a sledgehammer to crack a nut. This leaves some form (pdf) of market socialism and economic democracy. 

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We know the forces of production, under Capitalism, are stupendous. The amount of goods and sevices produced is staggering.

Yet, we still have starvation even though we throw away 40% of the food. We have homelessness even though buildings are empty. We have run-away climate change even though renewable energy sources exist and work. We have unemployed people even though the employed are stressed out over being over-worked. We have poverty in the midst of great wealth.

Capitalism is great at production, but lousy at distributing the benfits.

The central question is who controls the means of production? If a minority does, then the minority benefits. If the people, as a whole, controls it, then the people, as a whole, benefits.

The actual mechanism, by which we achieve the latter, is still under intense discussion.

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