a new ecology

Philosophers at work

2011-12-23T19:51:00.000+08:00

Dear Friends

Have set up a site for ideas from thinkers, philosophers and activists on a post-capitalist world.

It is at: Philosophers for change

My most updated blog site is: lightnews

Peace be with you

“Work Will Set You Free”

2010-09-24T14:30:00.067+08:00

The sign over some of the concentration camps during the Nazi reign of terror was the infamous Arbeit Macht Frei eponymously reflected in this post’s title. What does not seem clear at the moment is the connection and logical extension of the current work paradigm the world over from the events and psychology of the concentration camp.

In other words, whatever a person’s ideological bent the work world or labour today has the characteristics in many ways of what could be found in a concentration camp.

Exaggerated you say, as you quickly whip out your iPhone to set up the next appointment and worry about getting a three month annual bonus or worse, whether your mollycoddling of your superiors will allow you a larger cubicle and perhaps your own office space; never mind those who are not sure what Skype is and are waiting to load the next lorry with rocks from a quarry wondering how long they can do this past 40 years of age: and so many of us continue in this vein of wage slavery until death finally makes us part from it all. So we hope.

But there is more to all of the above than meets the eye.

[However, it needs be clear that this post is meant mainly for those who are familiar with the issues in it. It is also meant for those who may be familiar with most of the earlier posts on this site. For those who are, for want of better expression, reading stuff like this for the first time, it is understandable if you find much here that stretches your credulity. Even for those who have thought through some of the ideas here, there may be some resistance to what is discussed. But if readers are impelled from here to start doing their own research and finding out for themselves the truths about the world we live in, then writing this post has been worthwhile.]

Most of the references in this post are made to a ground breaking book entitled The Order of Terror: The Concentration Camp by Wolfgang Sofsky, (English translation, 1999). When I first read this original book over 10 years ago, what overwhelmed me was not so much its courage and tremendous insights but the almost nauseating content due to its subject matter. It is well written and not exploitative at all as it is basically an academic (but highly readable) work. Yet despite the restrained disgust expressed by Sofsky and his clinical description and analysis of what took place in the concentration camps (CCs), one needs an intellectually strong stomach to endure reading it from beginning to end.

Needless to say, you cannot breeze through such a book as if a bestselling novel. I read it bit by bit with some trepidation of what else I would have to learn about human history. A lot of what I read -- I resisted -- and so didn’t quite absorb the ideas first time around. The book needed a second read but I did not have the strength to do so then. Ten years later and quite recently, I forced myself to read it again. It was still tough to go through but I was better prepared; and suddenly something clicked about what it said and the world we live in.

Also, we live in a world well versed with Abu Ghraib and its nefarious activities. Things like that prepare you better for reading through the horrors of the Nazi regime. Which brings me to one of the key ideas in this post: in a post-September 11 we-are-all surrounded-by-terrorists world, the need to re-visit the past to let it shed light on the present is not just a necessity, it is a duty.

I repeat – a duty.

If you have any doubt as to what happened at Abu Ghraib and what it stood for, read Philip Zimbardo’s fairly recent The Lucifer Efffect: Understanding How Good People Turn Evil which is not only well researched and documented but clearly, brilliantly, and honestly written yet just as hard to read as Sofsky’s work (due to the subject matter).

The use of doublespeak by those who choose to enslave us and spread darkness as much as possible is legion. But few can have the watermark of irony and terror revealed by the choice use of words in the Nazi concentration camps’ motto “Work shall set you free” and that of the CIA’s “the truth shall set you free”.

One thing is certain, if Conrad wrote his magnificent The Heart of Darkness today, the last words of Kurtz would not be “the horror, the horror’, but “the terror, the terror” and in that he would be much closer in vision to the grand and unsettling work of H.P. Lovecraft.

Yet, we can take it as self evident that what man turns into darkness he can return back to the light.

Skulls and Bones

The basic points that Sofsky raises in The Order of Terror, revolves around the organized, bureaucratized and, in a sense, industrialized nature of the CCs. That they were created and managed not just by those who were pathological but those who in most instances were intent on running as efficient a machinery of torture and death as possible.

It is no secret that prototype IBM computer systems, or business machines, were used in cataloguing and managing the data of the internees and victims of the camps. They would have been used to manage the data of the staff and officers of the camps as well. This point is not raised by Sofksy but it is mentioned to highlight the well thought through organized structure the CCs were operating under: and that is a point Sofsky is at pains to make.

We can only wonder at this stage what computer systems and machines were used for similar purposes at Abu Ghraib and Guantanamo -- though it can be imagined Apple users pointing one way and others saying, ‘Don’t look at me’. But no one can ever say that their products in data management are not tinged with blood. And most of us thought that the work of Terror was often an ad hoc thing – it isn’t. I don’t mean the crazies who go about blowing up things for a lark or a supposed Cause, I mean a systematic and systemic use of planning and calculation to unleash Terror on all of us.

In other words – organized Terror.

With all that is organized, the time factor of things cannot be ignored. So unsurprisingly, one of the things that Sofsky looks at is the manipulation of time at the CCs. In a section that deals with the management of time in the camps and its effect on prisoners, he writes (italics and bold mine):

“Social time is an objective, imposed standard time of organization, but power can arbitrarily expand, slow down, or accelerate it. Camp time was more than the external compulsion characteristic of all social time. Camp power permeated inner time-consciousness, sundering all the internal band that laces together memory, expectation, and hope. Absolute power far surpasses the familiar forms of organized temporal control. It is not satisfied simply with synchronization and coordination of events. It destroys the continuity of inner time and severs the ties between past and future, locking people into an eternal present. Far from being satisfied with controlling human bodies, it seizes hold of biographical time and the motions of the mind.” (p73 Sofsky)

Who would believe that what applies to a Nazi CC is consonant with what takes place in the working world for so many people. The situation of time being controlled in a work place scenario and countless others involving organizations, reflects power play. There may be issues of respect and hierarchy involved which may be reasonable, but the focus here and elsewhere is to what is unreasonable and a matter of imposing oneself on another as part of a power play that involves denigrating someone or a group of people or entire societies and even countries. This is also known as the zero-sum game of those who overtly or insidiously subscribe to an absolute power paradigm.

Again, while statements will be made from hereon about how people are treated under the jackboots of corporations and other controllers, please bear in mind that it is with empathy towards those of us who are reasonable and responsible members of society rather than just malingerers.

So, take the example of a job interview in many cases. The prospective employee is made to wait sometimes for quite a bit of time, before being brought before the august interview panel to whom must be shown all due deference (and more). The interviewee has to consciously ensure, unless it’s one of those jobs that want someone with an attitude, that they kowtow towards those who may deign to employ them and help them have access to a bread basket.

From the start of how the time is controlled at an interview, what is made apparent is the relation of control being imposed. The relationship is unequal in which those who choose to see you make it quite clear that they are doing you the favour…and when they let you go for whatever reasons (profit margin, need to maintain fat bonuses for greedy top executives, etc) it should not be forgotten that after all, it was not what you contributed to the firm that matters, but your tacit recognition from the start that you are a being that was afforded employment assistance/opportunity; so who do you think you are when you are disposed of like a spent object from your firm? Get real.

Before more is said on this, look at a sample of what else is quote worthy from that section on time (italics and bold mine):

“Planning is one of the tools of social power…Schedules mark beginning points, end points, phases, transitions, linear sequences or cyclic returns…The fuller the schedule, the less time that remains for unplanned incidents, deviations, the wasting of time. The more dense the temporal grid, the more intensive the use of time. Planning determines the smallest moment; it knows only maximum rapidity, precision, effectiveness. Schedules guarantee effectiveness and provide a criterion for its monitoring. In its factorylike organizational form, the camp resembles other disciplinary institutions that gain stability by regimenting everyday temporal sequences.

But absolute power has only a limited interest in a rigid institutionalization of time. It regularly departs from the standardized time tracks it has instituted. As in any formal system, the regulation of time is an effective technology of power;…[but] Terror alternates between planning and disorder; between regulation and assault…By reserving for itself the choice of deviations and special times, power secures its rule over time. The temporal law of absolute power is not calculability, but the free variation of tempo, the shift between duration and abrupt suddenness, hectic rush and waiting, rest and shock.” (p73-4 Sofsky)

These words give a clearer context on the manipulation of time by those who control or are in a position of power over others whatever the situation it may apply to. Simply witness the way, in many instances, it is built into an employment contract that people can be made or ‘asked’ to work longer hours and do more than is required. It may be necessary in certain cases to do so and employees may understand that sacrifices must be made, but how often is it the case that employers exploit, bully and treat miserably those who are working for them (apparently this aspect of the contract is written in invisible ink between the lines)?

The reason for this is because the employment and economic structure of the world is quite often one that is pyramidal in shape with an emphasis on a master-slave relationship. With computers, world wide communications and so-called globalization we have employers squeezing all arteries and veins of a person at any time of the day 365 ¼ days a year to make them serve the god-like corporation or boss man; or, to assuage their petty egos aspiring for some display of absolute power.

Your time is not your own. Once you sign the Faustian pact with your boss man you’ve in effect sold your soul to them, and they make you pay for it over and above what they pay you. In fact, soon you will have to try and be like them to rise up the ranks of the boss men and women so that you can exercise similar master-slave paradigm roles/ functions over the other lower beings in the food chain.

How many people actually live in fear of what they say and do at the work place? Is it a work place or a CC? What is in place in microcosm is an Order of Terror. Countless times in various work scenarios, I have been told by people/colleagues how if they do this or that (usually that which is reasonable) and worse, do what is right or a matter of principle, they’re putting their ‘livelihood on the line’; other memorable phrases include ‘putting my head on the block’, ‘taking a real risk’ (as opposed to just a ‘risk’), ‘exposing my back’, ‘this could be It for me’, ‘they will hang me out to dry’ or ‘I’ll be out on the streets’ (many of which make nice titles for songs, the latter phrase in particular would make a good chorus these days).

Does this really sound like a workplace, never mind a healthy and pleasant work environment? It sounds like…exactly, ‘Sieg heil’ boss man.

Before proceeding further, we need to be clear about some terms. If the word ‘terrorist’ is used, it would refer to the usual villains who take people hostage, blow up things and have a pathological tenacity in causing harm to others. But the term ‘Terror’ (with the capital ‘T’) signifies a higher order of rapscallions who are using brutal and often subtle and sophisticated means of control, and fear instilling methods over people; in that context those who perpetuate such Terror are Terrorists. They consciously, or otherwise, engender the Order of Terror.

Yet when the terrorists operate purposively or subconsciously as part of Terror, then they too are part of the network of the higher order Terrorists.

The Order of Terror, unless it appears as part of a quoted text, will be represented throughout as OT.

Work as Violence

The groundbreaking work by the late Studs Terkel, especially his books Hard Times and Working, makes it quite clear that work/labour in most cases is a form of violence. It is a daily and unremitting violence inflicted on us just as we, unfortunately, inflict it on others. In many cases, we can see that the terms ‘work’ and ‘labour’ that refer to employment are usually references to the arduous nature and terrors of the workplace. Never mind the politicking and backstabbing, the exploitation and abuse that are never ending undercurrents of the workflow; just the work effort involved daily when it is continuous and relentless, irrespective of whether it is not so physical or literally back breaking, is enough to wear out the strongest amongst us.

The violence of labour is not just the act of producing something tangible or intangible. The violence also comes in the form of the physical, mental and emotional stress it can unleash on the individual engaged in almost any form of work including what they impose on others as they try to manage their loads and stay afloat – sadly in many cases at the expense of others. Violence in labour seems in-built in the way we do things: we are led to believe it is a systemic nature of the beast called humanity and that its nature is one that is indeed brutish, nasty and short lived in good will.

But back to our man Sofsky and the CCs (italics and bold mine):

“The camp invented numerous senseless tasks that had only one purpose: to drain and emaciate individuals, to grind them down. Absolute power strips labour of its purposive structure, expanding it endlessly. It has no interest in products or results. It is oriented to the process of working itself, to the duration of the suffering. It transforms hard effort and strain into a deadly pressure for annihilation. The social relation of power overlays the objective relation of labour, shaping it almost totally. Violence is not a means of labour; labour is means of violence. The prisoners did not belong to a slave class of outsiders. They were part of the class of the expendable and superfluous, the wretched and lost.” (p 172, Sofsky)

There is a dual meaning to what Sofsky says that applies to what is explored here. On one level it is the violence that is implicit in labour (which can lead to ‘productive’ goals), and the other which is an expression of (absolute) power over others. In some cases the two are conflated. But it is no surprise to most that a lot of the deployment of labour is a power game and while not always reaching that pinnacle of the pyramid, it is an attempt in some form of trying to embody absolute power.

While it would appear often times that showing up or speaking up against the boss man is a variation of cocking-a-snook against power, the offence to the boss man usually lies at a deeper level which is the perceived antagonistic stance of the sniveling subordinate towards the boss man’s sense of absolute power.

In concrete terms what does this mean. It would include:

Instilling the sense of who is boss man or woman. This is not so much to maintain a semblance of stability in an organization with some kind of meaningful hierarchy, but just the obverse of absolute power. In an unobvious manner this could include a formal way of addressing someone. Some boss men are informal, but many want to see some form of humility if not subservience shown to them
Knowing that you should not argue with someone not because they have conclusively shown why your idea was idiotic or not as effective as theirs, but because the boss man shouldn’t be contradicted (especially in front of others). This involves the secret and not-so-secret meetings among the lesser human staff after the main meetings with the boss men; this is to clarify what the hell exactly boss man or woman wanted (absolute power usually reflects shrewd manipulative thuggery as opposed to actual natural intelligence and common sense). Not a good idea to disagree with boss man, especially in front of others, because it can be seen as a railing against absolute power (in case your mother didn’t tell you…)
Whatever is produced may have value, as in a safety feature for a car, but the act of the labour itself in its mechanized and industrialized form is devoid of value as it is devoid of human sincerity in it: it is an act of sheer manufacturing and fabrication. Once someone in an assembly line has become robotic and is ‘producing’ in a meaningless manner, they have been subjugated by the work flow and the boss men supervisors into a situation, as Sofksy says, of one that “overlays the objective relation of labour, shaping it almost totally” (a line that would have made Marx and Engels proud). So there may be an object produced through labour, but labour itself is ultimately valueless as it is mindlessly performed by a labour automaton exemplifying a power relationship of control and fear between worker and boss man and the work flow itself
Each time a person leads an overtly ‘productive’ life, through what is described in preceding paragraphs, they are a showcase for labour as violence. Take the teaching profession, where countless tasks of apparent quality control, mind numbing meetings (for the sake of holding them as a work plan for a boss man/ individual staff member/department who have a matrix of objectives that must be ticked in a box using Adobe Acrobat to show that you’re actually working). The filling of class time with dingbat activities for the sake of giving a sense of conforming to the rules of the boss man or work matrix, even if the class proper/lesson of the day is over. The constant electronic and paper form filling as part of the pretence of achieving work objectives; falsifying and exaggerating management, professional or instructional goals so as to justify one’s teaching record; mollycoddling students to ingratiate them into getting good feedback scores which shows how popular an instructor you are; assiduously providing grade inflation to pass as many as possible or make sure that there is a failure or two to fit into some form of ‘bell curve’ – euphemistically known as ‘moderation’. All this is endemic, with the necessary adjustments, to most modern forms of work these days.
What doesn’t seem apparent is that violence is being done to us and we are doing similar violence to ourselves and others too. In this process we become “expendable and superfluous, the wretched and lost” wherein we now have to endure spiritual distress over and above everything else. Even for the agnostics and atheists amongst us, the moment we forgo a moral and ethical dimension to our working world and our daily lives, we have begun the downward plunge into spiritual degradation. How many do we know whose health has been ruined by their work and work environment. This applies to not just those whose labour is potentially dangerous like the construction industry, but just being a check out girl at the supermarket, a food stall holder, an office executive or a telephone operator. All this adds to the stress that comes from the use and abuse of power (with intimations of absolute power) including what is transferred back by, let’s say, customers (who reflect back to others their own daily labour and spiritual trauma). So in numerous cases of such daily violence and unpleasantness, people end up succumbing to debilitating illnesses
How many have even died from the stress and unhealthiness of the work environment and the type of work they do. I have known people and ex-colleagues who contracted cancer from the anguish, angst, pent up rage and frustration of their daily grind (compounded by other personal issues). But the greater part of our lives is our work world and the serious illness that we procure in this way is largely a sign of our spiritual dysfunction. We have become separated from all that is meaningful, valuable, holy, humane and decent in our daily lives that make up the essence of each human being. No economy that claims to be robust is healthy when its workforce is unhealthy and undergoing torments of the kind we normally associate with the nether regions of the spiritual world.

The wretched of the earth are not just the obvious ones who have been exploited and treated as chattel throughout the ages, these wretched ones are in many cases those of us who look ourselves in the mirror while fine tuning the make up or straightening that new fangled polka dotted tie.

The Living Dead

The working men and women of the world are in many instances reduced to the walking dead. Sofsky tells that many of the inmates of the camps were reduced to nothing more than living corpses known as Muselmanner (bold and italics mine):

“It was no accident that the Muselmanner [‘walking/waking dead’] were reminiscent of the “living dead”. They were only shadows of their former selves. Their actions had sunk below the animal minimum for survival. They hardly heard or saw anything, and reacted only when shouted at or prodded. When action is extinguished, life implodes, contracting to mere existence. In action, people mark a beginning to some sequence, show who they are, express themselves, communicate to and with others. Action is the medium of identity and sociality. A person robbed of action is a nonentity, a no one...Like the pile of corpses, the Muselmanner document the total triumph of power over the human being. Although still nominally alive, they are nameless hulks...The Muselmanner is the central figure in the tableau of mass dying – a death by hunger, murder of the soul, abandonment; dead while still living.” (p199-200, Sofsky)

These are telling lines about our daily struggle to survive. Ask anyone who is living at subsistence level and just managing their loans and children’s education among a host of other things and it will be described as the struggle to survive. During difficult economic times as we are living in now many are just barely scraping by, if at all, and one has to wonder whether this is what being a human being is about.

Ask ‘how’s it going’ to those in the US which is supposed to have a rising class of poverty where one in seven people are poor. A country that despite the better inclinations of many of its citizens is busy going into further national indebtedness and still trying to play ‘soldier-soldier’ in some parts of the world. It is almost as if a nation that promoted democracy and freedom has been hijacked by those intent on using it for their own purposes to control the world as much as possible, and run everything including the host body (America) this ghastly virus (the controllers) has inhabited into the ground leaving the world itself as a monument to the living dead.

So many of us just do not have the time to think through many things, nor sit down and have a decent, or intelligent, conversation with anyone about the issues of the day that in effect determine our lives. We have abrogated our abilities as human beings to fulfill our potential by surrendering such important things to others, be it the government (who has some responsibility to cover this gap for people) or ‘intellectuals’ (usually those with a string of academic degrees), neither of whom can be relied on solely without a check and engagement from the populace.

The people on planet Earth are not in charge of their lives in so many ways, certainly not their societies, and sure as heck not their countries. The economic system of wage slavery which is the epitome of the capitalist structure has put some of the most dishonest, disgraceful, egomaniacal, bloody minded and immoral people on any planet in positions of so-called authority and, of course, power (all the time edging towards absolute control). We have given up in being able to actively engage the most important people in our lives like our loved ones, never mind our social and national responsibilities (unless it is fulfilling some task as part of the mindless muddling through of daily life as the living dead).

The common, and understandable, excuse most of us give about barely speaking up and taking part in the life of our communities, society and country is that we don’t have the time; how can we have the time when apart from personal and family issues we have to earn our daily bread with our faces forced into the grind stone? Our heads are sometimes so close to the ground eking out a living that we can become hostile to suggestions to look up and see what is being done to us, or be completely dismissive of alternatives and deliberately place ourselves in ignorance mode, rather than face what is truly happening around us.

True, some of us may be just lazy and not want to take the extra effort to confront what’s wrong in our world, but usually we ‘don’t have the time’, and how can we when we have – or rather allowed – our faces to be forced squarely into the trough and made to sound grunts of complaints or surrender to this-is-how-it-is scenario, and be just grateful to continue to see what we can find in the trough.

And how convenient this situation has been, is and will continue to be, and how much it would facilitate their attempts at control, for those who seek to dominate people and keep them at the base of a pyramid as they continue to exploit everyone by staying on top of it all.

Then there is the constant apprehension of workplace reprisal for doing what is ‘wrong’. Sofsky tellingly writes (bold and italics mine):

“Terrorstraffe (terror punishment)…Punishment is the final link in a chain of situations strung together via the social mechanism of sanction. This chain begins with a threat that forces the actors to decide among alternative paths for action: if they do what is demanded they incur no penalty; if they violate the required norm, they trigger a sanction in response…Absolute power operates in a quite different manner. It creates a “jungle of punishable offenses,” a condition of constant punishability, in which even obedience is no guarantee for avoiding sanctions, and power can intervene at will...To compound matters, many prohibitions had been kept nebulous so that supervisors could arbitrarily define what was an infraction. This absolute power to define the situation used another method: it made demands that could not possibly be met, extending the perimeters of threat to the point that behaviour in accordance with the prescribed norms was sheer impossibility.” (p215, Sofsky)

Most us would resonate with the accuracy of the words here on the use of fear tactics to ensure dominance over others in the workplace. In many contracts there are clauses that stipulate how things can be adjusted in terms of hours required, scope of work, where you are transferred to and how much responsibility can be piled upon you in a manner that is almost always in favour of the employer; and if it is ever in favour of John or Jane Doe there will be some way to circumvent that and insist that you sell your humanity to the corporation/employer for whatever pittance they pay you (pittance because your soul is priceless but there would be those who disagree).

If the boss man decides to promote you, he will. If he doesn’t want to, he will find some reason to justify it. You are entirely at the mercy of the boss men and they intend that you see it that way despite the pretence otherwise. Someone I know who has been with an organization for some years has been criticized for not doing enough or broadening the scope of his responsibilities and range of his work despite the boundaries he pushed, and the quality of his work. On the other hand, when he does well within the demands of the boss men/women (and the boundaries they create) he is criticized for having done things like a ‘well-oiled machine’ and not having messed up enough in his performance which would have shown that he was taking ‘risks’ and going beyond the comfort zone of his basic work load: you’re damned whichever way you look at it.

The point of this Kafkaesque situation is that you are right and doing well when the boss men tell you so. Not only is this a corollary of deciding arbitrarily what is an infraction, but also that the range of what is acceptable for you can never be determined other than what the boss men decide on a whim. This is, sometimes unbeknownst to the perpetrators, an attempt to exercise absolute power.

In case it’s still unclear, absolute power is essentially to try and have the ability to control you body, mind and soul…and destroy you one way or another if controllers so desire.

In fact, the bizarre world of Kafka’s The Trial and The Castle is far from strange considering that it is a reflection of our everyday world. It is recorded that when Kafka read drafts, or parts of the works mentioned, to his friends/co-workers (if I recall rightly) they burst out laughing knowing full well that it was also a satirical take on the bureaucratic world they existed in (as can be applied to almost any workplace).

A ridiculous bureaucracy with silly, contradictory and outright outrageous ‘rules’ and ‘decrees’ in many workplaces is but part of a system meant to exercise control over people. It is an attempt to reduce entropy through the misguided notion of many dictators and wannabes that they are in charge of the universe. That they can stop change and evolution of a person or a group of people as that change would render them, the controllers, obsolete. Then what would happen? Meaning, what would happen to them. If they can't have livelihoods as controllers, they would then have to starve as most exploiters rely on someone else’s efforts and lifeblood to survive on. They suck up the energies of others.

They are the vampires of our world and a stake needs to be driven through their ideas of edging towards absolute power before they turn more of us into the zombified living dead that they want so as to enhance their control.

This type of blood-sucking bureaucratic system is a parallel to that which pervaded the CC as Sofsky clearly points out.

It becomes clearer what Sofsky is trying to say: that not only was the whole CC idea carefully planned and executed as best as possible with bureaucratic ‘efficiency’, but that in order to systematically control, put fear into and organize mass torture and extermination, you need some form of bureaucratic control. The OT demands that there is a systematic structure of control, surveillance, monitoring and fear mongering and anxiety spreading everywhere that can be instituted and codified such that not only can you boss people around as atrociously as possible, but you dehumanize them and destroy whatever authenticity, decency or resistance they can possibly offer. This is the kind of Terror that becomes even more difficult to spot because you are indoctrinated and socialized into it from birth (some people call it being ‘normal’ or ‘the-way-things-are’).

It also becomes even harder to shake off this indoctrinated worldview of fear and need to appease controllers when the other nutcake (higher order synthesis of nut cases and fruit cakes) terrorists are busy blowing us and themselves up as part of their dramatic-statement pyrotechnics: the hyping of which allows many mainstream journalists to make a ‘living’ (through our dying).

If all this is still called ‘normal’, granted that it can be called ‘the-way-things are’, then we need to know what is the difference between this and being the living dead. George Romero’s Living Dead, day or night, is a tame reference to the world we call ‘normal’. We have been socialized into being workplace zombies, social Muselmanner, and decidedly non-vegan type consumers of our fellow beings to ‘survive’ in the world. In fact, that is what the so-called vision of a capitalistic driven world strives for: consumerism of the worst order. We consume everything, including the planet, ourselves and one another apparently to create ‘growth’; but all the while we are enacting acts of violence through our ‘productive’ activities that ensure a tragedy without the catharsis.

More importantly, we have been programmed and propagandized by most social strictures and structures with the abetment from much of the world’s mainstream media that engenders the undiscerning conformist mentality of ‘be-like-us’ through manufactured consent: where no one can defy being a zombie or show signs of being contrary to the Living Dead lifestyle (cell phone, obsession with TV, excessive social networking site usage, following the corporate diktats of advertising/marketing, etc).

Path to Perdition

The world has been fixated for decades in using GDP (gross domestic product) as measurement of economic growth thereby replacing all humane and spiritual values as a means of providing balance to what not only genuine growth is, but whether in the process we are leading even vaguely meaningful lives. The tendency to focus exclusively on the misguided notion of ‘productivity’ at all costs has led to the kind of ‘growth’ that is not only destructive all round but ruinous to our health as human beings.

Sofsky goes on to write about the extermination process of the CCs (bold and italics mine):

“A death factory is a work organization whose purpose is the annihilation of large numbers of human beings…Mass annihilation was organized on the basis of a division of labour. The process was integrated into a kind of assembly line, its stations coordinated in temporal sequence. Killing was mechanized by the installation of stationary gas chambers, into which hundreds of persons were lured and then poisoned by carbon monoxide or hydrocyanic acid fumes. The death factory was an apparatus that functioned smoothly, virtually trouble-free, working at a high capacity and speed. A death train arrived at the ramp in the morning; by the afternoon, the bodies had been burned, and the clothing brought to the storerooms.” (p259, Sofsky)

No doubt, ‘productivity’ can be applied to the above. No doubt efficiency and high volume of results are showcased by the quote. But to even ask at what ‘price’ belies the horror of what Sofsky’s words describe. Yet we have bought into this system where whatever the human, environmental and spiritual cost, there is the need to mindlessly churn out stuff to keep GDP ‘growth’ going. Never mind the non-monetary cost, anything that doesn’t add to the mechanized numerical increase of monetary measurement is just an externality (economists love this term). The human being and the whole world is an externality: so you have the dangerously ridiculous situation of mindless ‘production’ and ‘growth’ while destroying the planet and its life forms that sustain that ‘growth’ apparently for the good of the human species.

Therefore, many economists would be aptly represented as dangerous bozos.

Normally people who think like the above are clinically diagnosed with various mental issues, but up to now, we give them titles, degrees, Nobel prizes and call them ‘experts’, ‘leaders’ and ‘captains’ of industry. And so the term GDP, in honour of such illustrious ones, will be used here as gDp which signifies gross Destructive product as a more accurate way to depict their fantasy of 'growth'. [For more details on new ways of measuring growth and the blatant harmful nature of GDP as it transforms into gDp, please see the earlier posts at this site.]

While some of us struggle to bring across the facts to help the rest of the world to come to an understanding as to why GDP = gDp, a likely scenario that will develop increasingly is one where GDP as a measurement will be clung onto while different ways of measuring progress like the GPI, or Genuine Progress Indicator, may be used in tandem with it to provide ballast. But either the GPI or something similar will finally have to replace the GDP/gDp as a growth measure.

In the end, the way we destroy the natural world, its ecosystems and our selves with gDp is parallel to the death factories where we are in effect using the misguided notions of neoclassical economics meshed with fear and anxiety promoted by the controllers of the world to forge a world of Terror: maintain a system of production that creates inequality throughout the globe through exploitation of human and natural resources resulting eventually in a culling of the global population as a way of limiting population growth and further competition for resources.

The 20^th century has seen the ultimate attempt by the OT to assert its control over all of us by excessive mechanization and dehumanization of the entire planet (bold and italics). As Sofsky says:

“Along with the state monopoly on violence, rational bureaucracy, and organized work, modernity has also given rise to sites of discipline, surveillance, and conditioning. Modernity has confined human beings for life and trained them to be obedient, docile subjects. The manufacturing plant, industrial factory, and administrative office are the centres of bookkeeping and bureaucratic filing, economic exploitation and political rule. However, the military barracks, prison, penal colony, hospital, workhouse, and insane asylum – these total institutions are the laboratories of power. Here, far from the scrutiny of public surveillance, a special agenda is pursued: the transformation of human beings by other human beings…But in the concentration camp, no one was supposed to be healed, educated, or trained to obedience. Absolute power makes use of the technology of the disciplines, liberates them from their aims, and transforms them into instruments of terror. Its systematic nature is based on this transfer of the disciplines of control, on the coerced unification of action, its Gleichschaltung [“forcible coordination” or reorganizing all social, political, and cultural organizations to be controlled and run according to Nazi ideology and policy]; on minute, total surveillance and control.” (p277, Sofsky)

Again look at how our daily schedules and our entire lives have had all sequence of time come under fitting into the murderous Procustean bed of the work flow. Virtually every aspect and time frame of our existence has been absorbed and forced into the “forcible coordination” of survival, attending to material needs, and fear and trembling not only about our future and that of our loved ones, but the saturation of violence and mistrust bred across the world (played up to a scatological degree by the mass media).

The ultimate sign of victory for the “forcible coordination” of our existence to the capitalist structure of monetary growth and value is the belief that ‘time is money’ and phrases like ‘buying time’. We have lost all control of our lives when we are plugged into a system of control, like in the CC, where our entire value system and the way we ‘spend our time’ is crunched and assimilated into the living dead concept of money being the centre of gravity of the world. Space-time and gravity are no longer natural phenomena and part of cosmic laws, they have undergone with us the “forcible coordination” into adjusting to acknowledging and worshipping money and those who control it as the blasphemous multi-headed hydra at the centre of darkness.

Before examining how the OT has tried to control all of us, we need to look closer at what the ideology of control they have been carefully and successfully pulling across the globe. This may sound difficult to accept at first, but careful thought and researching and the willingness to suspend preconditioned thought will help give a different perspective to the world we are living in.

The ideology that the promoters of Terror have used to spread the gospel of hate, prejudice, destruction and domination is known to us today as ‘democracy’, not Democracy as we have a theoretical or intuitive understanding of, but ‘democracy’ as spread by major proponents of this ideology. This is why it is hard to spot and come to grips with it because it is like the most insidious of viruses – it masks itself as that which is ‘helpful’ to the individual/society but is in effect the start of a destructive consumption of life.

First, try this exercise: spend some time thinking of what you think genuine freedom and Democracy is for an individual and for a society, a nation, and the rest of the world. Write it down irrespective of whether it sounds ‘utopian’. Be honest about it as it is a private exercise. Compare what you have written (take your time with this) to what you will read further on. [Stop reading this post here, and try this exercise. After thinking through what you’ve written, then continue reading on. But, yes, I already here the objection: ‘who has the time….?’]

Below are some aspects of what ‘democracy’ as an ideology, masquerading as Democracy as a political philosophy or idea, has tried to do so as to enslave us:

Follow the ‘American’ way unconditionally according to the diktats of, for instance, the Bush-Cheney-Rumsfeld regime (you can look at this in the context of almost any US administration in living memory with arguably the exception of Kennedy’s). Bear in mind that both Bushes have openly declared that they have “hate” in their “hearts” towards their so-called ‘enemies’. This is a matter of public record, check it up. This was used at least in relation to North Korea and its nutty (no, not the lovely Thelonious Monk piece) leader. We would normally link those who call themselves ‘leaders’ and voice out hate openly for others as leaders of another sort, but certainly not of Democracy
This means: unimpeded access by the US and its so-called allies to (this is not in reference to the people of the countries but the network of controllers who secretly run the country, government, business, media, pharmaceuticals, etc) all countries and economies throughout the globe for what suits their own interests
Meaning: unimpeded access by the controlling cabal in the ‘US’ (what we term ‘America’ today is anything but America) to all natural resources of all kinds whether it is oil (which requires control of Middle East oil supplies) or any natural resource to promote ‘growth’ and GDP (gDp) at the expense of all life and human welfare
The ‘American’ way means a one superpower world and all those aligned to it who have as is possible complete corporate, financial, media control of the world. This is sometimes achieved through utilizing corruption and subversion of other governments elsewhere – especially those that resist the ‘American’ way openly – with the use of US fiat currency (which is worthless like any currency that is not backed by precious metals) as the dominant means of economic and political control, followed by black operations and military force. Interesting thing: if you listen to US military officers who speak their mind freely, they’ll mention that they get themselves and their men in ‘trouble spots’ largely due to the CIA’s shenanigans in various states, and their bamboozling politicians, economic bigwigs and defense department bureaucrats in US of A
The manipulation and control of world bodies like the UN, WTO (World Trade Organization) and World Bank which serves as a means to hold to ransom, debt, bondage and merciless exploitation people and resources of poorer states by the controllers who have ensconced themselves by hijacking a great nation like America with their viral ideology of ‘democracy’
Promotion of wars and the armament industry as a means of fuelling gDp and ensuring some form of global dominance. The best way is to keep the world divided through constant conflict as witnessed from wars throughout the third world and the criminal war in Vietnam which almost sent that state back into the stone age; never mind the wars with Iraq, Afghanistan and prodding of North Korea into a striptease nuclear brinksmanship
The need to curtail civil liberties in America which championed Democracy but has been usurped by the cabal as it spreads the ideology of ‘democracy’ via buying over politicians, corporate control of the media, suppression of anything in the media that nationally promotes spiritual learning, thinking and questioning the role of military might and imperialism or material obsession, and spread of capitalist ideology (and gDp)
Promote the idea that freedom means excessive and destructive individualism at the expense of everyone and everything else
Final solution to destroy the remnants of Democratic America’s civil liberties: creation of the Orwellian situation of permanent war, where spreading war is called spreading ‘peace’, the mind-numbing-soul-destroying promotion of double speak in spreading falsehood, false flag operations by the CIA that subverts many states and national interests by spreading ‘democracy’ and ‘freedom’ there as opposed to Democracy
To consolidate this in a one superpower world, you need to manufacture a massive attack on your soil: September 11^th, 2001. Create a tragic and horrific incident in which ‘two planes’ caused three high rise modern towers to collapse in a meltdown and in which, against all laws of probability, remnants of passport or identification papers were found among the wreckage belonging to the ‘hijackers’ (!)
Manipulation and aggravation of a permanent state of war between the Muslim states and others (all of whom also have the their fair share of fruitcase – one step above nutcake -- terrorists) as part of promoting the grander scheme of Terror
Further acts of terror within the US (remember those random sniper shootings of civilians post- 9-11?) to cause permanent state of siege that could possibly lead to a suspension of all civil liberties as well as the US Constitution; there is also the convenient establishment of CCs – yes, concentration camps – for US citizens (or any other ‘undesirables’) under the auspices of FEMA (Federal Emergency Management Agency): a search on the Net will provide visual evidence of these camps

First, reactions might be -- well this all very imaginative and not really new and things are not that bad. Really? Why is there a constant state of anxiety and terror being spread conveniently all over the world…where does all the funding come from. How convenient it is, that the state of ‘terror’ we have been put in has led to the rise of constant and heightened surveillance (understandable in some cases) of public spaces. It’s even worse for some private spaces. Paranoia is the order of the day. The Panopticon of observation keeps everyone on a macro and micro level under duress. The constant fear and anxiety spread at airports and modes of travel, and the work place fear of sabotage is very much like the war and fear mongering mentality spread through the time of WWII and most of the Cold War.

This is a most useful way of getting people mistrustful and fearful of one another and strangers. Not that there are no genuine security concerns etc. But the Terror being spread from 9-11 has been an attempt to drag humanity back to a state of wartime tension. Moreover, every surveillance camera is a reminder that things are not right and that people are not right and that the world is not right. The world and humanity may not be perfect as we well know, but there is a difference between that and being made to live under “forcible coordination” that it can never be otherwise. That is what the controllers want.

This state of tension if you like, then also encourages the other crazies to go about their business of terror. The media collaborates with them by highlighting their activities thereby ensuring that the best way to get a megaphone and ‘buy’ media time is to commit atrocities. Note: good and well being don’t often get much air time, but acts of violence and that which flirts with the prurient not only get air time, they get prime time advertising to boost it all.

Again, where does the money come from to keep supporting these groups of ‘terror’ and even terror. There are bigger players who want to keep terror groups up and running, their activities being media highlights right up to this moment and thrust upon people as part of “forcible coordination”. Terror, with its unchecked and unregulated international banking cartels and arrangements, and its abilities to print fiat currency money or debt currency as via the US Federal Reserve Bank, has ample resources to fund its pet projects.

Ask yourself, how is it that a state like North Korea which has been repeatedly stated to be bankrupt and has its population living in precarious conditions still manage to have access and maintenance of nuclear weapons coupled with haphazard saber rattling announcements. Who are the groups that are sustaining the North Koreans and keeping them from total collapse so that they can conveniently add to the potential destabilization of North East Asia and keep the world in nuclear angst ?

How is it that despite the global financial crisis, spiraling debt of the US, the never ending wars, and the rising unemployment world wide, the world financial system is still tottering but not collapsing yet: how is it being maintained, propped up and kept alive when it too seems to be turning into one of the living dead? If the global scene is not somehow manipulated and controlled by major players this system would have collapsed well before now, but it is still being controlled and puppeteered as it has always been.

Look past the curtain of current economic theory’s mumbo jumbo and see the controllers grappling over the levers behind the curtain of illusion drawn across the world from the land of Oz.

The New Slavery

On a macro scale the stage has been set to keep the world and all of us in debt through a debt based economy of fiat currencies, interest rates and squeezing every drop of labour from us till we drop dead. But on a micro scale, Terror must still be spread to dovetail with the global template of “forcible coordination” that major players are implementing through international institutions and power play.

As Sofsky unrelentingly continues (bold and italics mine):

“For its (modern terror) purposes, the small-time tormenter suffices: the conscientious bookkeeper, the mediocre official, the zealous doctor, the young, slightly anxious female factory worker. In order to spread fear and terror, all the personnel had to do was to apply the rules that had been set down. This orderly foundation of camp routine provided the soil conducive to the development of those behavioural patterns that spring from the tradition of quasi-military movements: esprit de corps, camaraderie, personal allegiance, the mentality of the emergency situation, corruption, and the lust for the kill.” (p278, Sofsky)

That last line sums up ‘American’ domestic and foreign policy for many a year and, unfortunately, much of the world has followed suit or allowed the virus from that kind of ‘democracy’ to spread to them.

What cannot be denied as well is the Kafkaesque bureaucratic nightmare of petty tyrants who impose meaningless rules and regulations to wield (absolute) power as best they can largely because the social and national atmosphere most people operate in permeates the same unto them. This system of bureaucratic control is spread on the macro level in turn by the controllers and serial invokers of ‘democracy’ who claim to be saving the world by using things like the UN, WTO, World Bank etc.

Total control by the cabal (controllers) and denizens of Terror require it to be practiced throughout all of society without exception as far as it is possible. It is part of the strategy of spreading “forcible coordination” globally. The best way is to instill a sense of fear and loathing in each layer of society, but primarily through the work place as it is the inevitable arena where we try to sustain ourselves.

To do this the cabalists of controllers need the Grand Poobahs and Great Panjandrums to exercise the diktats of control. And so Sofsky continues with (italics and bold mine):

“Without the supervisors, sentries, and administrative officials, the accomplices and accessories from the ranks of the inmates, camp terror would have been impossible. The face of modern systemic terror is not stamped by the all powerful and inviolable master, but by the unbridled actions of the sedulous servants of power. It is an inconspicuous face, quite mean and shabby, without the grimace of wild frenzy, the ecstasies of brutality, the passions of sovereignty...The triumph relished by the auxiliary was the laughter of the accomplices, the mortal anguish of the victims, the bottom line on the balance sheet of death.” (p278-9, Sofsky)

So absolute control is spread by the cabalists via set ups international and national, which is seen through by trickle down (and forced) indoctrination abetted by the mass media. The message transmitted daily and unremittingly is that people are not powerful and that the individual is not an empowered being.

The little Hitlers and Napoleans at the micro level of the work place go around determining control and spreading the gospel of the cabal through punitive sanctions and the constant threat of throwing one out of employment, or stymieing progress/promotion. We are born into the world and don’t know any better as we are imbibed with received deception (not wisdom) of control and subservience to the dark ideas of the cabal which we take as normal and the way of the world. [Under no circumstances is it being claimed that people do not choose wrong and evil themselves and that only the cabal/controllers are responsible for everything, but to qualify statements each time with this would be tedious and add to the meandering of an already lengthy post].

We learn further from Sofsky (bold and italics mine):

“Absolute power transforms deterrence into terror, terror into horror. It shapes space, time, work, and society into instrumentalities of itself, plunging its victims into the abyss of helpless anxiety. The destructive power of terror extends into the furthest corners of sociality, the deep structures of human subjectivity. It destroys not only by violence, but by starvation and misery, humiliation and murder of the soul. It is sheer destruction, pure and unadulterated…Terror concludes every struggle. It gets the job done. The reciprocity characteristic of all social power is shattered.” (p279, Sofsky)

Again on a micro level, just take a look at going from one place of employment to the next. The nihilistic philosophy of the cabalists to control, dehumanize, humiliate and disempower people pervades through almost everything. From every situation of authority (real or imagined) there is often an attempt to assert some aspect of absolute power; this is an ego based energy that seeks to use the pyramid structure of a disenfranchising hierarchy of control. Do as you are told, the boss man is always right, and we the cabal and its nether children of control can throw you out on the streets and let you starve unless you serve us as the slaves that you are.

The human power of reciprocity and responsibility towards one another through a web of connection with all life and compassion needed to give balance to the world, our societies and our lives is constantly crushed through the deleterious stamping of the OT imprimatur usually in the form of material and largely monetary (valueless fiat currencies) ‘rewards’ for selling and destroying your soul and those of others. These are the bargain basement prices of all the hells imaginable: save your skin, not your soul, by abetting the physical and spiritual destruction of others and life on the planet via the promotion of mindless monetary growth and as much as possible for sensual gratification. Reciprocity is made negative through the encouragement of an ‘eye for an eye’ way of the world, not one of mutual aid, support and nurturing to create cooperation and collaboration among people and countries.

We continue to chillingly learn (bold and italics mine):

“Terror separates labour from all production value and any moral rules. It intensifies compulsion and exploitation to the pitch of destruction; it transposes production into ravagement. The teleology of human labour is extinguished. The productive meaning of work, self-preservation of the species, is transformed into its opposite. Nowhere is human labour so directly linked with death as in the concentration camp. Here work does not secure life, it devastates it. This political economy of waste cannot be comprehended by following the principle of calculation and value enhancement. Absolute power overcomes the laws of production. It increases not wealth, but misery.” (p280, Sofsky)

Shocking as it may seem, the above is an apt description of our daily lives especially our so-called working lives. The entire economic and financial system that has been imposed on us by the cabal, and those sometimes quite unwittingly carrying out the worldview of the controllers, is one of mindless accumulation of wealth through making many things that are not needed and that have an in-built obsolescence in them; this in turn continues the destructive cycle of pure monetary ‘growth’ while destroying the planet, robbing it of life and natural resources and steadily allowing for the fear and anxiety based destruction of ourselves and our social relations. A political economy of waste.

We are usually alienated from what we do and the apparently productive processes we are involved in. So many times have employees deliberately gotten back or ‘sabotaged’ the system and the boss man by wasting time at work through idleness and Net surfing, and consuming office materiel and expenses for personal use and benefit. This is usually an act of rebellion and resentment for being pushed around and doing something we dislike and even hate but consider necessary to sustain our material needs. What is productive about this set up or the commodities that arise from it? A political economy of waste.

From the wasteful system of built in obsolescence and greed of the capitalist ideology to its mindless accumulation of money as a means of remuneration and definition of meaning to existence; and with the cat and mouse game between employer and employees who try every once in a while to monkey wrench the work place, we have a fine system of wastage and negativity. Yet another facet of a political economy of waste.

To maintain control over us, there is a need for a system of destructive sustenance that sees to it that (bold and italics mine):

“Society is permeated by the informers and accomplices of terror; the victims are driven to a life-and-death struggle for space, shoes, and bread. Although a good many examples of elementary solidarity have come to light, the extent of social indifference, mutual repulsion, and animosity in the camps was staggering. The dissociative strength of camp power shatters the basic rules of social intercourse, fundamental trust in the continued existence of the social world, the prospect of assistance, the certainties of social action, the continuity of time…The camp hurls human beings back into a primal state of nature: the struggle of all against all…The concentration camp is the modern facility of isolating and destroying the “dispensable”. The superfluous are searched out everywhere, seized, confined behind barbed wire, starved, murdered.” (p280-1, Sofsky)

What is supported throughout most societies and certainly in the economic framework of the cabal is the ‘state of nature’ scenario of ‘survival of the fittest’ and everyone struggling to stay alive through brandishing tooth and claw. We have fooled ourselves into buying into the so-called ‘free market’ myth (which is just a not-so-secret secret society code for greed, selfishness, monopoly, destructive ethos, etc as explored in an earlier blog entitled There is No Such Thing as a Free Market, which has laughably been seen as a sign of ‘freedom’.

Yet you cannot be free if you are a slave to unethical/immoral behaviour that often belies ‘market’ forces, a slave to pure monetary gain at the expense of everything else, and a slave to blind sensual drives while throwing any spiritual force within a human being off course.

And in case the message still hasn’t gotten through we are reminded that (bold and italics mine):

“Absolute power sunders the physical unity of the person, devastates spirit and soul, destroys the ability to act, drains all vitality. Prior to industrialized mass murder, it carries out a transmutation of human nature. The transformation of human beings into materiel and the fabrication of the Muselmanner, the waking dead, are its greatest triumphs. In sharp contrast with all earlier forms of power, absolute terror creates nothing. Its work is totally negative, a project of obliteration without a trace. It realizes its freedom in the complete and total annihilation of the human being.” (p281, Sofsky)

Through a system of control through the mass media, economic and financial institutions, the cabal has sought to keep us at each others’ throats through the perpetuation of fear and loathing, anxiety and obsession with destructive individual ‘rights’ which do not involve the reciprocation of duties to respect and honour the rights of others; it’s all about ‘I-me-mine’ as the advertising/marketing world keep reminding us (the destruction of reciprocity).

So some key points that can be raised from all this on the strategy of OT:

Use a feudal hierarchical pyramidal structure of top-down control
Institute capitalism as the primary economic model which leads to a system of senseless accumulation of wealth and material products maintained by the use of the media to promote consumerism and obedience to the fetishized ‘market forces’ established by the cabal’s global financial and political institutions
All ‘value’ is measured in terms of valueless fiat currency which is printed at whim to finance never ending wars and the creation of eternal debt
Keep the world and its peoples in a state of perpetual debt and wage slavery as they cannot rely on their spiritual values and ideas to build economic strength but must rely on ego and fear based energies of impending starvation from reprisals to their physical beings if they resist the cabalists structures (micro and macro)
Keep people busy with meaningless work, jobs and employment to just earn money to survive; keep them in debt-bondage and obsessed with sensual indulgence so that they are unable to turn away from the debilitating effects of the idiot-box-and-devices (TV and mobile phones); and turn them away from reading, thinking, and sharing intelligent ideas with one another. Counter serious examination of the state of the world and citizen participation in local, political, or any other sensible activity by a system of disenfranchisement
This system of disempowerment is boosted by ego driven cynicism of so-called social commentators as well as the worship of celebrities and mania over the frailties of their personal lives, and attempts to get the rest of us to be more concerned about who earns the most in business and Hollywood. In other words keep us distracted from improving and empowering ourselves through surrendering our attention to nut-cakey-fruity-case flakes and other such media-attention-grabbers
Obsession with material goods through the constant promotion of the latest fashion products and accelerate built-in used obsolescence in almost anything (example, computers) and mobile phones which require us to seek constant upgrading (and confuse that as ‘upgrading’ ourselves)
Derail us from thinking about why we are here and what is the purpose of life. Ensure that the mainstream media doesn’t focus on spiritual matters but things that engender hatred and negativity through the playing up of violence, war and dysfunctional behaviour. Constant prattling on the ‘weaknesses’ of human nature and never the strength of unity, reciprocity and challenging of absolute power and corporate controllers, that is, the media’s complicity with the agenda of the cabal to ensure that human beings are kept in a state of the living dead while thinking that the lives they are leading are supposedly ‘normal’
The constant disruption of time and sequencing of events in our lives due to the stress and anxiety created by the negative media reports and work place demands, coupled with personal/family ones, keeps us in a state of limbo and hectic behaviour that fits perfectly with the ‘forcible coordination’ of the controllers

But to ensure that control can be permanent and the market of global control has been cornered through a one superpower world, the cabal needs to institute a takeover by re-creating what the Nazi’s did in 1933 and 1938 (looked at in more detail below). The need to exercise absolute power by the cabal through the use of terror to establish once and for all OT. We are still living in the shadow of the the near successful attempt of using the 9-11 attacks on New York to suspend all civil liberties, and eventually establish openly the FEMA CCs as a step to turning the US into a launching pad for more war, and as a base for quickly consolidating and spreading world wide the ineluctable OT. For those who think what they are reading now is fanciful, be patient…it won’t be too long from your reading these words that even more stunning revelations will take place.

This is Not Democracy

There are no genuine democratic countries in the world today. ‘America’ has been hijacked by the cabalists and ‘democracy’ there is like a deadly virus they hope to spread everywhere. It is hard to determine when, in a long time, in human history there existed any genuine Democracy. The ‘democracy’ of today is but a sham in which people are enslaved to serving the diktats of OT. The cabalists have come close to winning their game, but they will not as many of us have started to awaken to their activities.

The cabal’s 9-11 attacks on America was a replay of creating similar conditions that allowed the Nazi’s an excuse to push for fascist control of Germany. The cabal ambitiously combined the 1933 burning of the Reichstag (German parliament) and the 1938 Kristallnacht in an attempt to assert control over the world’s sole superpower to initiate their agenda of an old world order of domination (typically these bozos call it a ‘new’ world order -- it’s the virus hiding itself in doublespeak).

Do some research on America’s so-called Patriot Act instigated conveniently by the 9- 11 ‘terror’/Terrror attacks, and what the Nazi’s initiated in those fateful years of the 1930s. The papers of the day in Germany described the attack on the Reichstag as a “most monstrous act of terrorism”. The fire was blamed on Communists whom the Nazi’s wanted to counter so as to gain a parliamentary majority and thereby start their plans for fascist domination of Germany. So the official account of the Reichstag burning played along the terrorist lines to stoke up fear among Germans and send them into the arms of the Nazis (italics mine):

“The burning of the Reichstag was intended to be the signal for a bloody uprising and civil war. Large-scale pillaging in Berlin was planned.... It has been determined that ... throughout Germany acts of terrorism were to begin against prominent individuals, against private property, against the lives and safety of the peaceful population, and general civil war was to be unleashed....” (this and the German newspaper quote above are from the Wikipedia)

Hitler, who was just made chancellor weeks before the fire, managed to coerce through the Reichstag Fire Decree which effectively curbed most civil liberties of the Weimar constitution, and the preamble of the act stated that (bold and italics mine):

“On the basis of Article 48 paragraph 2 of the Constitution of the German Reich, the following is ordered in defense against Communist state-endangering acts of violence:

Articles 114, 115, 117, 118, 123, 124 and 153 of the Constitution of the German Reich are suspended until further notice. It is therefore permissible to restrict the rights of personal freedom [habeas corpus], freedom of opinion, including the freedom of the press, the freedom to organize and assemble, the privacy of postal, telegraphic and telephonic communications. Warrants for House searches, orders for confiscations as well as restrictions on property, are also permissible beyond the legal limits otherwise prescribed.” (taken from Wikipedia)

Does this have a familiar ring in post- 9-11 ‘America’?

But this was the tip of the iceberg: what Hitler and his hooligans were aiming for was to get their Enabling Act through which would allow him and his chief thugs to make dictatorial laws without the approval of the Reichstag, thereby establishing a fascist state.

With the Enabling Act passed, Hitler would be given the control that developed into his dictatorial powers as he could do what he wanted through decrees that bypassed the Reichstag nor his having to discuss anything with other political players.

The 9-11 attacks were not a terror attack but a Terror attack by OT. It was hoped that this act of high treason would start the effective move of America away from civil liberties and the total undermining of the US Constitution and Bill of Rights (whatever is already left of it). This would place the cabalists in control of the world’s sole superpower and to do as they pleased anywhere. The FEMA CCs which thrive on the term ‘emergency’ -- which was what the Nazis also used to justify their tyrannical takeover of Germany -- is the logical extension of the cabal’s attempt to control things thereby giving them the leeway to target those they would prefer to get rid off/contain (including masses of people who could protest the eradication of their civil liberties).

Then there was the Kristallnacht of 1938. With the murder of a German diplomat in Paris that year by a Jewish youth (as reprisal to the over night expulsion by Hitler of thousands of Polish born Jews from Germany), the Nazis instigated a nation wide anti-Jewish pogrom. Jewish homes and businesses were ransacked and destroyed in the thousands which not only resulted in deaths but the start of mass deportation of Jews and other ‘undesirables’ to CCs. The ‘Night of Broken Glass’ was the staged vendetta of the Nazis against their opponents. It was also the first steps towards all the horrors associated with the Nazis and terrors of the CCs.

The transfer of people to CCs and the systematic mass destruction of human beings was all part of an organized wave of terror that merged with “forcible coordination’ as part of the overall concept of Terror.

This ideology of Terror is precisely what the cabalists of today also want to enhance throughout the world. Create the materiel you need for the material world and force a planned obsolescence of culling people so that the ‘wealth’ of plunder that comes from war and from the formulation of so-called lebensraum (Nazi thought is very much alive today) ensuring economic/political incursions into the sovereignty of other states for one group which results in the death/slavery of another. Zero-sum all the way.

So the current cabalists in a fit of ambition and, what to them must appear as use of the imagination, decided to combine the Reichstag burning and Kristallnacht through pulling off the 9-11 Terror attack. They launched perhaps the mother of all false flag operations in recent times to blame the destruction of the twin towers in New York on terror groups (who would form the kernel of the ‘enemy’s’ identity, that is anyone who is Muslim); this was the Reichstage fire aspect of things except that the cabal’s work that September day was far more violent.

The cabal ambitiously used 9-11 as a Kristallnacht too and (since Americans were also killed in the attacks) as a platform for reprisal against not just certain targets in the Muslim world (the nutcake Saddam being a prime example), but to initiate instability world wide through the move into Afghanistan and raising the general ire of Christians and Muslims around the world who saw this more as an extension of the old drawn out drama from the Crusades of yesteryear.

All this was dissonant music to cabal’s ear as spreading instability and creating a scenario of divide and conquer kept all of us even closer to the ground with faces shoved into the troughs of not only daily survival, but now fear, anxiety, loathing and anger against one another. Yet the cabalists wanted to go the whole hog this time, so they ‘imaginatively’ tried to go for the CC idea of their revived Nazi ideology by raising ethnic/religious issues within America.

Not long after 9-11 the Bush appointed Peter Kirsanow head of the U.S. Commission on Civil Rights nicely stated that “if there’s another terrorist attack and if it’s from a certain ethnic community or certain ethnicities that the terrorists are from, you can forget about civil rights in this country.” Kirsanow eloquently added that if there was yet another attack, there could possibly be internment camps (CCs) such as those built to hold Japanese Americans in World War II. But the man was on a roll, so he had to continue with, “Not too many people will be crying in their beer if there are more detentions, more stops, more profiling…There will be a groundswell of public opinion to banish civil rights.” Hell, yeah. (Quote taken from:here)

I ask you, not so bloody minded gentle reader, would a democracy (forget Democracy) have created CCs for its Japanese American citizens many of whom were just decent patriotic folk anyway?

Then just in case you thought this was all just a…coincidence with 1930s Germany, please bear in mind that there were deportations of Muslims, seizures and interrogations of American Muslims by the FBI, as well as thousands of American Muslims being told that their jobs in the US, particularly within the civil service couldn’t be guaranteed now that we know conclusively (it would appear) that it was a bunch of Muslims who did 9-11.

All this frenzied activity sounds a trifle, uhm,…terroristic upon ordinary people, won’t you say?

To think that some outstanding universities and institutes of learning exist in America – but wait, Germany had even more to offer like Beethoven, Goethe, Kant, Marx (ah, the fella was Jewish) – yet, all decent and rational thought was suspended in subservience to “forcible coordination”.

But let us not underestimate the cabalists; if you’re visionary you go all the way, so the cads came up with plans for a subsidiary of Halliburton KBR to be given a US$385 million contract by the (Right Honourable) Department of Homeland Security to build detention centres in America. These centres might be used for illegal immigrants, to house victims of disasters like Hurricane Katrina, or perhaps those who start protesting against the cabal if ever their plans were seen through (part of this could stem from riots breaking out due to the collapse of the cabalist capitalist economy).

So the whole idea of the CCs apart from taking care of ‘undesirables’ was to also boost the gDp by increasing expenditure on camps which would go to companies run by the cabal (yup, them Halliburton guys are it). This attitude of cannibalization and going into any part of the world using force or threats and getting whatever materiel needed to expand gDp, and to exercise control and spread ‘American democracy’ or “forcible coordination” is truly the bedrock of much ‘American’ foreign and trade policy today.

This is the zero-sum winner take all and death-and-damnation-to-all-else attitude that is also the skull and bones foundation on which all feudal and capitalist systems are based. The whole idea of such an approach is to ensure that humans see their existence as nothing more that an animated pile of dust that returns to the ashes that issues forth from crematoriums.

Our entire economic edifice is built on such a system at the moment that fits in with the cabal’s way of thinking. Just go through all the quotes from Sofsky mentioned here and you will see that the Terror promoted in the camps, and the sense of constant surveillance and control, fear and anxiety that such a system promotes is the extension of what the Nazis did in the 1930s to establish their OT.

Right till today, through political, economic and social control with the triumph of the will of materialism the cabal hoped to destroy anything of a spiritual nature in humans by creating their ultimate goal: the world as a concentration camp writ large. But they are not going to be able to do it as we have started to finally wise up.

It is almost a scenario out of H.P. Lovecraft where the cabal are like beings from another planet unleashing everything that we know is inhuman and inhumane, as they turn our world upside down. And it is no surprise that the Nazi idea of a ‘master race’, and many other practices and symbols used by them, have occult roots. Do some research to see how they used dark forces that seem to be the underlying template of Nazi ideology.

And in case there are still those who are recalcitrant in their beliefs that ‘America’ is a democracy and that there is Democracy on planet earth, please remind yourself about what took place at the Abu Ghraib and Guantanamo camps, and ponder if that is reflective of democracy. Whatever the excuses or rationalizations, the horrors of CCs worldwide throughout history may project many things, but they are not representations of Democracy. If you say that such instances cannot be helped because of the way things are, the response is: precisely, there is no democracy or Democracy today, and we have not in living memory have had any actual experience of it.

Delusional Democracy

What we call ‘democracy’ today is nothing close to any idea, much less an ideal, of Democracy that a decent person would like to see in the world. How can there be Democracy in a world that is at war with itself, under the constant threat of ‘terror’, real and imagined, and the sway of Terror (real, not imagined). We are stuck in a world where people are burdened by debt and meaningless work cycles of ‘productivity’ that seem to get us nowhere (for the vast majority) within an economic system of greed, exploitation and total non-sustainability. How can a world scenario like this ever give rise to Democracy?

What of the current system in so-called western ‘democracies’? By and large that system is represented by the image above this section. We have less developed countries (yes, they are responsible for their own problems too) which have been consistently exploited and kept in debt by inequality and coercion as represented by most world bodies of which the WTO and World Bank are prime examples. The commodities from poorer states are made through cheap and mercilessly exploited labour to support a silly and self indulgent lifestyle of people too busy to consider the morality of their actions, usually spending their leisure welded to their TVs and engaged in other mind and soul numbing activities like shopping for what you don’t need (but told is necessary by advertising and marketing), and voting in people who are beholden to big business and banking cartels.

Dwight Eisenhower’s farewell speech at the White House had the iconic reference to the military-industrial complex that is behind ‘America’. But some research will show that Eisenhower had wanted to mention Congress too, which would have been the devastatingly accurate statement that ‘democratic America’ was beholden to a military-industrial-congressional complex, and so it is (the US Federal Reserve was the missing link in the chain).

Kennedy famously talked about the secret government and the reprehensible idea of government by secrecy. He had plans to stop the US involvement in the burgeoning conflict in Vietnam as well as introduce a hard currency backed by precious metals (contra the useless fiat money of the US Fed) which were to be called US Treasury notes. These hard currency notes were conveniently recalled from circulation soon after JFK’s murder. It is no surprise, in retrospect, that he was eliminated before he could do further harm to the ‘democratic’ interests controlling ‘America’.

The entire structure of the state in so many ‘democracies’ is designed to protect those who run the corporate, financial, and war mongering apparatuses to keep the so-called voters mind-numbed through fear/anxiety saturation using unending world wide conflicts, the daily grind of work and constant debt/mortgage through an economic flow that promotes crazed credit expansion through borrowing beyond what you can pay. This entire rotten and crumbling ‘golden calf’ is supported gleefully by the media so that it can also sustain itself and the fluff work of not reporting the actual state of affairs of the world.

Sure, this is part of the actual state of affairs of the world: ‘a bomb has gone off in…”, “China has recalled its envoy from…”, “the newest strain of the H1N1 virus has led to the WHO asking…”. The second half of the news may include: “Tiger Woods says he’s sorry…again…”, “Stephen Hawking has decided that God doesn’t exist…”, “Is the hair of XYZ celebrity for real…?”

What you don’t hear, because it would throw the present disgraceful and immoral morass of a world economic system into its widely deserved grave, is “Steps to reconfigure the entire world banking systems are being unveiled, experts finally get off their a**e* to discuss how…”, “More and more Americans and people all over the world are demanding a reinvestigation as to whether the September 11^th attacks were a false flag operation – coming up after the break…other examples of possible false flag operations by major governments of the world…”, and how a couple strive to survive in these times through forming a cooperative with their close friends.

There can be more human interest stories that show how people overcome adversity or how the human spirit shines through normal daily activities, but the main items always play into the cabal’s hands to keep the world hostage to a self created drama of violence and mayhem. Of course, disasters must be covered and people given advisories etc about trouble spots, but the entire mainstream media is mostly aping and competing with one another to see who can be the most bloody minded in its reporting: and this poppycock reporting is given the misnomer journalism.

More people, including those who are asserting their discernment again in the US, have come to realize that most of the characters they vote into political office are serving interests other than that of the people. So many politicians in the sole superpower on earth tend to openly support the cabalists monstrous structure of deceit, greed, exploitation and violence .

How much longer is it going to be before people across the globe take back their power and the planet? We are indeed like the prisoners in Plato’s ‘Allegory of the Cave’ from his great work, The Republic. In his famous analogy, Plato explains how people are chained into a certain direction facing the wall of a cave and made to believe the shadows cast on it from objects and light behind them are real. From time to time, someone from the outside of the cave comes in and breaks a prisoner free, and drags him out kicking and screaming (he’s unwilling as he prefers his comfort zone of indoctrinated ‘truth’) to see the world outside.

There is pain of adjustment to the eyes as the newly freed prisoner turns his focus to the world outside of the cave and sees an incredible vista filled with the light of the sun and the objects as they are rather than their shadows. He rushes back to tell his fellow prisoners about this, and they of course think he is bonkers, and start to regard his claims as a threat to their comfort zone engendered by the slavery to the puppet masters casting shadows on the wall. Sometimes the prisoners are so incensed by the ‘nonsense’ of the guy who came back to help free them that they would rather kill him than face the truth about the false world they live in.

It is not that difficult to think of some spiritual and other leaders who have been murdered because they tried to do the same. The cabalists are the shadow masters who operate away from light and transparency; they thrive with cloaks and daggers. So many of us are still prisoners in the cave. But we can still make the journey out together with courage and effort and with the help of those who have slipped out of the cave – thinking through their ideas like those of Plato and Kant; heeding the examples like that of Gandhi, Mandela and Mother Theresa of Calcutta; and observing the leadership of some like the Brothers Kennedy.

We have to leave the shadow play behind on the wall of illusion and take on the difficult task and challenge of breaking free from what is considered ‘normalcy’. Our very survival and that of the planet rests on our forcing ourselves away from the delusional images we are coerced to watch on the wall of the cave (think mainstream media) glorifying fears, anxiety, violence and excessive self indulgence.

We have been force fed a homogenized genetically modified murderous diet to convince us that the world we live in is one of despair and that we are mainly material and negative beings who need control and who only can end up as a handful of dust. But this is where the cabal has seriously miscalculated. Because when the human species starts to wake up, it cannot be stopped, and we can all -- if we work collectively on this -- make it up the slope from the innards of the cave: back into the light from which all life originates.

What Needs to be Done

We have to throw away pre-conceptions and what we’ve been indoctrinated with from birth through most of our adulthood – that we are not spiritual beings and that material needs can never be met if we prioritize our lives by giving equal weight to our material and spiritual needs. Let each person decide for themselves who reads this what being a spiritual being means for them, and see if by extension some of the points raised below includes what is needed to provide for our material well being and spiritual growth thereby creating a balanced and sustainable world in which war, poverty and the slave-type labour of our working world imbued with “forcible coordination” can be finally eradicated.

We would be looking to achieve:

Move away from the largely capitalist driven mind set that growth = gDp which means mainly a monetary measurement for what is economic growth. With the premise that we are spiritual beings first who happen to have physical bodies that need support, we then need a measurement of growth that reflects this as part of our well being. We take the quality of life into serious consideration, not just the quantitative aspect of things. Some of these ideas have been explored in earlier posts at this site
That all living things should be respected including the Earth which is clearly a living entity. The Earth is alive because no life can be supported, nor would evolution occur, if the planet is but a large pile of dust. Life comes from life, not death-like inert matter despite the bizarre ideas of those who claim to be scientists (who are in fact promoters of occult beliefs that there are mysterious forces floating out there like ‘gravity’ that just happen to conveniently arrange themselves into ‘natural laws’). If the Earth is a living entity, then we must have a measurement of growth that respects this and includes this notion of protecting and enhancing its eco-systems thereby ensuring the survival of our own economic and social eco-systems, through ethical, responsible and sustainable living and production
This means channeling resources away from war and destruction (contra the aim of the cabalists) into positive ideas and green technology to forge a new way of energy creation, productive activities, and commodity exchange throughout the planet among different communities/societies/states. Some resources will be kept for security needs but if war can be lessened and the cabalists taken to task, peace can takeover the planet
End the idea of separation through language, religion and race and see the Oneness of all life. Whatever we do bear in mind the golden rule of doing unto others what we want others to do unto us: this implies a system of shared responsibility, tolerance, understanding, mutual support, help and respect – in a word, reciprocity
Reciprocity would entail a just and fair economic and political system which will lead us closer to the citizen empowerment that can help form the base and driving force that will help us not only recreate what Democracy means, but help us to try and finally realize a democratic system of citizen involvement, responsibility and consultation in local and national governance
Not to be sidetracked by the confusion that rights mean rabid individualism at all cost. All rights imply the duties of respecting the rights of everyone, that is, rights operate within the context of our duties to one another. For unless we have a duty towards others, or reciprocity, how on earth do we have a right to anything since nobody has a duty to respect the rights we claim for ourselves
Recognize the fact that we are co-creators of our world and reality. That every invention and commodity we bring out should reflect this for the betterment and highest good of all
A system of smaller and manageable businesses and economic enterprises that reflect a community base form (which can cross borders and will not be multi-nationals but multi-communals). No shareholders except those who are of the businesses and these entities, as far as possible, should be owned by all who are of the enterprise and have a transparent system of profit sharing that ensures growth (in a manageable way) and sustainability of the enterprise and all who work for it. Profit will be a term that will belong to the past where a win-lose scenario is envisaged. We are going here for a win-win situation at all times as far as is possible and one of sustainability
The complete reinvention and rejuvenation of the world financial and banking scene with community banks taking a leading role. This would work in tandem with the return to hard currency backed by gold and precious metals for all countries thereby giving real value for money
That money is seen as a resource that can be re-cycled back as donations and trusts after the death of mega wealthy individuals (e.g., Warren Buffet, Bill Gates who have decided so) to help the underprivileged and raise environmental consciousness
Have healthy competition that involves cooperation and collaboration among all towards support for all life as far as possible as the underlying principle of growth, not the destructive kind of competition that hinges on mindless profitability and unbridled exploitation, or zero-sum situations
The realization that the world is abundant in what it has to offer us if we channel our learning, science, technology and natural intelligence, not to mention common sense, to come up with ways to produce what we need to support us best we can while giving back to the Earth and maintaining the natural balance of its diverse and miraculous ecosystems
That we see ourselves mainly as caretakers of the Earth and caregivers to one another so that our education system starts with these premises and builds societal, regional, international and global responsibility towards one another. So we start with the initial conditions of education with the children outside of ‘the cave’ and get them used to the light soonest – they don’t need to be taught the shadow play we were stuck with but the way of light which is working with one another so that we all gain and benefit
A new and responsible media that highlights what is positive, what works for the well being of all and what brings us forward boldly into the new paradigm of getting things right. The so-called bad news will still be there, but balance it for what it is…the aberration in a world that is growing up and maturing into civility. This takes the sting away from those who remain from the cabal who may want to re-assert the old destructive ways
That the practice of calming and breathing exercises, meditation and connection to nature be a common aspect of life in schools and the work places. This would be the start of increasing trust, goodwill and even high work output among people. With fair and decent remuneration all round (as opposed to furthering excess and indecently high salaries), the daily work world can be transformed into one that a person can look forward and contribute to willingly and purposively
A work/economic paradigm that is successful as it is even joyful because what is being provided and created is for the benefit and highest good of all involved and the world at large
Understand and respect the sanctity of all life

Naturally, the nay-sayers will claim that this is not possible in many instances because of the ‘way things are’ (a motto of the cabal) and ‘human nature’ (the cynical view of which the cabal hopes will continue). If that is the case, then these people who claim this are supporters of a dismal determinism where there is clearly no free will; in which case they are already and always will be slaves even if they pretend they are not.

If there is free will, then we can choose. But the fact that we can indeed choose and have ideas of what is good and what isn’t, and that many of us see spiritual dimensions to things, is sign enough of a greater power at work than the limited and childish human ego. We need to start to learn to let go of our limitations and blinkers of controls that have been placed upon us, to create the new paradigm and history of the Earth.

The question then arises so what else can we do now to hasten the positive changes and get rid of the ungodly yoke of the cabal? Perhaps three basic things may be useful here: first, see the economic collapse that is upon us as a good sign and actively find ways to enhance new economic models that are green and people friendly, as mentioned above.

Next, do all we can (this applies to those of us who are not US citizens but affected by the cabal’s ‘American’ policies) to encourage Barack Obama to get going with the arrest of the cabalists behind 9-11 (email the guy, he needs to know that people everywhere are behind him: link). This is the thin end of the wedge that will bring about either simultaneously, or consecutively, the eradication of the US Federal Reserve which is the stronghold of the cabal and its worthless fiat money, as well as the bringing to justice of the key cabalists for Terror against humanity. This will get the ball rolling and the cabal’s operations will start to shut down and operatives throughout the world will be rounded up by various other governments and forces within them (not all are under control by the cabalists) who are waiting for the signal from ole Barry.

If it still isn’t clear, let me for the hell of it just say: we are all in this together, big time.

Finally, we all need to just commit acts of gratuitous kindness, decency, compassion and just plain civility in all situations at all times as is humanly possible. This above all is the start of the People of the world uniting and coming together as a gathering of light that will dispel the cabal’s Terror forever. There can be, if we create it, governments of the People, by the People, and for the People and the Planet that can never perish.

Also, the obvious should still be stated that this post is not the answer to all our problems; we are also creating solutions as we go along and react to events; rather, it is an energetic transfer to the ether and collective consciousness in support of other co-creators who want to see a new and blessed world for us and the next generation to live in.

To those who see how real and how much within our grasp most of the ideas here are that will allow us to create our own destiny, to those who have the courage to turn away from despair and see that there is Divine grace in all life and within ourselves to get rid of the cabal’s influence and create cities of light in a world of light, and for those who have decided that being human is a compliment to what is good in the universe, I can only say with the utmost gratitude:

Thank you for taking back your power.

And peace be with you.

End of Poverty interview

Plato’s ‘Allegory of the Cave’

There is No Such Thing as a Free Market

2009-12-16T10:45:00.175+08:00

“I always assumed …that the writers we were studying were always much smarter than I was. If they were not, why was I wasting my time…studying them? If I saw a mistake in their arguments, I supposed they [the philosophers] saw it too and must have dealt with it, but where? So I looked for their way out, not mine. Sometimes their way out was historical: in their day the question need not be raised; or wouldn’t arise or be fruitfully discussed. Or there was a part of the text I had overlooked, or hadn’t read.”

– John Rawls, “Some Remarks About My Teaching”

What does the great Sergio Leone’s brilliant “Dollars Trilogy” have in common with our idea of the so-called Free Market? Well, for a start the titles are enough to give most Capitalists a run for their money: A Fistful of Dollars, For a Few Dollars More and The Good, the Bad, and the Ugly. A careful look at these wildly entertaining films also reveal what most would agree the common idea of the Free Market brings – a great deal of competition to see who is the last man standing after as many Mexican standoffs as possible; who gets the cash at the end; how many bodies you must climb over to get to your cash heap; how much manipulation, lies and betrayal are necessary to make and keep you top dog; how to make as many enemies as possible; how to achieve a life of constant neurosis and paranoia, and a good deal of other niceties.

But there seems to be some whose idea of the Free Market may sheepishly try to avoid all that is described above. Unless you tell them they get to play Clint Eastwood, as that might change the equation somewhat.

This post will look at the common usages of the term the ‘Free Market’ to show that there is no consistent idea (in fact, no sensible one either) as to what this term means, as it is a free for all catch phrase to sum up an amorphous idea of a genuine misconception.

We will also take a look at the much maligned Scotsman Adam Smith and the crazily abused idea of the ‘Invisible Hand’. It will become apparent that Smith has little to do with what Capitalism and the ‘Free Market’ mean. That Smith was onto something else more subtle, accurate, and profound than the mumbo jumbo churned out through the ideological hijacking he has been sadly subjected to.

As the epigraph from Rawls suggests, this post will try to show in its own way that Smith was a far greater and consistent thinker than many have made him out to be.

To Market, to Market, to Buy a Fat Lie

So what does the hagiographical term ‘Free Market’ (FM) mean. The misuse and abuse of this term has led to so much of the world’s problems today. There are numerous definitions for FM but we will look at a rather all encompassing one.

According to the Wikipedia, the definition of FM includes:

A…market without economic intervention and regulation by government except to regulate against force or fraud. The terminology is used by economists and in popular culture. A free market requires protection of property rights, but no regulation, no subsidization, no single monetary system, and no governmental monopolies. It is the opposite of a controlled market, where the government regulates prices or how property is used

The theory holds that within the ideal free market, property rights are voluntarily exchanged at a price arranged solely by the mutual consent of sellers and buyers. By definition, buyers and sellers do not coerce each other, in the sense that they obtain each other's property rights without the use of physical force, threat of physical force, or fraud, nor are they coerced by a third party (such as by government via transfer payments)and they engage in trade simply because they both consent and believe that what they are getting is worth more than or as much as what they give up. Price is the result of buying and selling decisions en masse as described by the law of supply and demand.

Free markets contrast sharply with controlled markets or regulated markets, in which governments directly or indirectly regulate prices or supplies, which according to free market theory causes markets to be less efficient. Where government intervention exists, the market is a mixed economy.

In the marketplace the price of a good or service helps communicate consumer demand to producers and thus directs the allocation of resources toward consumer, as well as investor, satisfaction. In a free market, price is a result of a plethora of voluntary transactions, rather than political decree as in a controlled market. Through free competition between vendors for the provision of products and services, prices tend to decrease, and quality tends to increase. A free market is not to be confused with a perfect market where individuals have perfect information and there is perfect competition.

Free market economics is closely associated with laissez-faire economic philosophy, which advocates approximating this condition in the real world by mostly confining government intervention in economic matters to regulating against force and fraud among market participants. Some free market advocates oppose taxation as well, claiming that the market is more efficient at providing all valuable services of which defense and law are no exception, that such services can be provided without direct taxation and that consent would be the basis of political legitimacy making it a morally consistent system. Anarcho-capitalists, for example, would substitute arbitration agencies and private defense agencies.

In social philosophy, a free market economy is a system for allocating goods within a society: purchasing power mediated by supply and demand within the market determines who gets what and what is produced, rather than the state. Early proponents of a free-market economy in 18th century Europe contrasted it with the medieval, early modern, and mercantilist economies which preceded it.”

This sounds just about right. So what would be a summary of the key ideas here:

A FM is one in which there is no governmental intervention “except to regulate against force or fraud”. So no control by governments of any form of economic activity
A FM sees to it that the price mechanism operates within the law of demand and supply to ensure people get what they want. Trade is engaged in through consent and gain for everyone results from this
Any government intervention means lack of efficiency as opposed to the efficiency provided by the FM
The FM ensures the allocation of resources according to consumer satisfaction which is something political interference cannot do. The FM also makes certain that due to competition “between vendors for the provision of products and services, prices tend to decrease, and quality tends to increase”
The FM promotes the removal or minimization of taxation. It is also so efficient and brings about so much good that all sectors of a country can be left under the tutelage of FM forces including defence and the law
What is not mentioned in the above definition clearly is that many proponents of the FM believe that it is the subset of, if not the main cause for, personal freedom and liberty

Think about these ideas and see how they resonate with you.

And now take a look at what they mean under the scrutiny of common sense:

a. Take a look at (1). If the government is so useless and such a bore to the operation of the FM, why is it needed to “regulate against force or fraud”? If the FM is so effective and useful and powerful, how come it needs government help? For an entity to be able to ensure that the all powerful FM is protected against “force or fraud”, it must be more powerful than the FM in order to be able to so do.

But this is exactly what the FM is trying to avoid, but it needs its nemesis to ensure its survival because a genuine free for all system (which the FM implicitly seems to strive for) would ensure chaos and a cowboy town mentality that is not always conducive to consistent growth and wealth.

So an effective FM it seems always requires a powerful government. It is most unlikely that a powerful government would then sit by quietly and allow the FM to run things without ample kickbacks over and/or under the counter for itself. So (1) is patently absurd.

b. Take a look at (2). Price mechanisms work within the law of demand and supply. There is such a thing as pricing but ‘price mechanism’ is the infantile idea of neo-classical economists who have no idea what the world is about. And what on earth is the ‘law’ of demand and supply (DS)? There is a law of gravity to all intents and purposes, but demand and supply are completely arbitrary.

If demand and supply are a law then why is there always a mismatch between them because of either shortages or excess. The one thing you can be assured of is complete lack of consistency/regularity to this trumped up ‘law’. Pricing is also arbitrary depending on whether these are normal consumer items or luxury brands and goods. But unilateral price adjustments by suppliers and factors that influence them are regarded as interference in perfect market models of the neo-classical economists who claim that if it was not for branding, advertising, marketing, businessmen ascertaining prices, profiteering, people having irregular income flows, why, then you would see a ‘law’ for DS and this strange animal called ‘price mechanism’.

But, the proponents of the FM insist that their idea is different from the silly notion of a ‘perfect market’. But it is just as clear that the FM is based on some weak version of a ‘perfect market’ where apparently you can have the ridiculous situation of an all powerful government who decides to sit on its hands and protect the FM without daring to interfere in it (without considerable gain for itself from the situation).

People never get what they want from the FM because it constantly uses consumerism and all the unpleasantries supposedly avoided by a ‘perfect market’ like human egomania and delusionally driven advertising, marketing, media and banking hype to ensure that you are always dissatisfied with life and what you have. If, heaven forbid, you would actually find satisfaction and peace in life would you really want to be indebted and work for unreasonable bosses to get that X-box or I-pod?

Trade is not engaged for the benefit of everyone. What do these people claiming this know about colonialism and gunboat diplomacy or the so-called ‘free trade’ agreements of today which leave countries, governments and peoples indebted to corporatism and profit mongering?

If there is one New Year resolution for 2010, please recycle all your economic textbooks as they are written by the deluded using a lot of sound and fury signifying nothing.

c. Take a look at (3) and remember that if government interference causes inefficiency then why have the government try to protect the FM. Why not have the FM privatise government and then ensure the framework for the success of the FM. But does that make much sense? Why call it a Government if it has been privatised. In fact, why have any political entities at all, why not just have warring factions of corporations killing and robbing on another to see who survives the competition. (Yes, Leone has a visionary subtext in his “Dollars” films).

But would that really suit the FM? Best to have Government (under its influence and control as far as possible) to ensure that the killing and robbing is done within some form of stability and legitimacy thereby accentuating the ‘Free’ in FM, that is, allowing corporations and Capitalists to do whatever the hell it is they want. What kind of freedom is it if you’re not free to do harm to people around you and not have it legitimized thereby having the best of both worlds.

And how come the FM is more efficient than government? The FM as extolled by Capitalism and driven by the lust for profit has only resulted in massive waste of resources due to destructive competition, devastation to the environment and incalculable human misery. Look at the wastage of money, natural resources and human life that is needed to feed the Capitalistic drive for profits (whether it be the internationally renowned sweated labour of globalization, media hype promotion, inculcation of amorality and immorality, and dumping/destruction of excess goods to create high demand through artificial shortage so that high prices can be extorted).

In short, just look at the current economic and social mess the world is in and ask the proponents of the FM how much more Free Market-ness do they need?

The most remarkable thing is that they even give out a Nobel economics prize to ensure the further spread of economic instability.

d. Take a look at (4). Allocation of resources according to customer satisfaction is not always a good thing. Just think of all the negative products and issues societies have to deal with to realise that pleasing the customer in everything or giving in to unbridled human desire is not what we all need. That’s the kind of thing when advocated ensures the continued existence of laws, prisons, and the security services, not to mention Government -- which FM enthusiasts are supposedly wary of. In fact, it is this attempt to give in to as much as possible to untrammeled human wants that have led to so much of our problems and constant need for media and consumer watchdog agencies, that is, even more forms of monitoring and control (apparently to enhance freedom).

Common sense will show that competition may lead to some form of price decrease (at the expense of the welfare of people and the environment as wage cutting and environment bashing gets top billing), but that hardly correlates to an increase in quality of things. Often it is the case that quality runs short just as prices decrease. Bootleg/’pirated’ editions of things are a good example.

e. As for (5) what results are the unending attempts to avoid and minimize taxation so as to increase profits and satiate the greed of Capitalists/FM proponents. The consumer and the public are then left to carry all tax burdens through goods and services taxes/VATs, higher income taxes, higher interest rates, and/or the tax that comes in the form of inflation which erodes your earnings: just as Capitalists continue to fine tune every form of tax evasion. This has turned out more as an incentive for dishonesty and robbery of the populace than efficiency or effectiveness.

Part of (5) has also been responded to under (c). If defence and the law should be run by private interests then why bother with any government; however, that would result in a situation where no fixed entity with public backing can produce conditions which will allow the private enterprises to make their killings in the market.

f. Then we have (6), an important component of the FM myth. Let’s take a look again as to why this is an illusion. In some cases the only way to ensure the functioning of the FM as Capitalist fantasists have it is to have a powerful government in place. This is precisely why most FM fantasists and hard core Capitalists tend to support fascist regimes. A look at Nazi Germany and fascist Italy confirms the not so subtle role of Capitalists behind these regimes (not to forget global banking cartels owned by gangster bankers/banking mob, a.k.a. banksters).

One glance at the United Corporations of America (UCA) – formerly known as the USA or United States of America – shows how far gone the country is in the hands of Capitalist cabals and banksters (the UC/US Fed being a branch), and how much of the country has been subjected to near fascist control and fear mongering.

And at the end of the day all this so-called freedom of the FM creates a situation that is conducive to the creation of monopolies. These monopolies then grow larger and more powerful and then do their best to shut out all other competitors or gather together to form an oligopoly. All this is at the expense of the rest of society, but that’s the freedom of the FM to do whatever it wants at the expense of anyone whom it perceives stands in the way of profit.

We also need to look at this beast known as the Corporation as the key entity of the FM. If anything, the corporation exists because there is a legal and political framework that emanates from the government. This goes back to the points raised above that ironically the corporations under the auspices of the FM would be non-existent as such without a government to back it up, and a pretty strong one at that in order to protect corporate agendas and profit obsessions.

All this creates a perfect reductio ad absurdum where the FM and their beloved corporations cannot exist unless they put in place what they fear will interfere with their plans most. But as we know, one traditional way round this is for the FM and corporations to have fascist governments (or some form thereof) arise so that they can then have what they think is the best of both worlds: a guarantor of their interests as well as owning the governments it puts into place.

The only loser in all this is the people of a country and the rest of the planet from the shenanigans that arise from such a situation. It’s worth repeating: freedom to the FM and corporations means everything goes to hell except the satisfaction of their profit motive thereby removing the very stability and balance on the planet needed to allow the bad behaviour of the FM and corporations to take place in the first place.

Given the above situation created by the drive for have an apparent FM it is manifest that there is simply no such thing as a Free Market.

QED

It’s in the Way that You Use it

Dear Readers, contrary to popular mythology there is such a thing as a free lunch. It comes from people just being decent and charitable, or altruistic. But there are many who insist that they believe in a FM that is not typical of Capitalism and the negativity that goes with it. The term FM here is used in the most typical and common usage of the term.

Broadly, the main categories of the FM would include:

The Generic Meaning

The Capitalist Meaning

The Right Wing Ideologue Meaning

The Libertarian Meaning

The Accurate Meaning

A. The Generic Meaning

This has been covered by the Wikipedia definition delineated above. Essentially it means the unfettered operation of the market through the presumed law of DS and minimal government interference. The absurdity of this definition has been made obvious.

B. The Capitalist Meaning

This would take off from the Generic Meaning but emphasise the right of corporations and businesses (one paragon of how this works is the UC of A) to do what they want, how they want, whenever they want without interference from any form of government, citizenry, non-corporate entities or interest groups, any sense of morality, fairness or human decency. What is right is what greed, selfishness, violence and the profit motive dictates. The exception is a government that is in its corporate controlled form interfering to help corporations/capitalists at the expense of all others.

C. The Right Wing Ideologue Meaning

Using elements from the above, this definition would include that while any form of government interference may be unpleasant, the government ought to somehow ensure its non-interference and allow for the ascendancy of Capitalism, the profit motive and maximum consumer satisfaction. Anything that vaguely opposes this is anathema or smacks of Socialism/Communism or (anything that could possibly be) worse. And state sponsored violence or any form of force instituted by private enterprise is justified if it allows this ‘way of life’ to carry on. Any form of corporate sponsored state violence to support corporate and corporate linked interests, is perfectly normal and should even be extolled. This tends to be consonant with extreme religious and/or racial prejudice. At times certain fanatical religious elements seem to align themselves to this belief or claim that it in turn allows for their zealotry to exist.

D. The Libertarian Meaning

This is usually consistent with the belief in a form of individualism and independence from authority structures that allow for people to do as they please while respecting the rights of others to lead their own way of life. Hence, business models as in certain small business types tend to gravitate towards this interpretation of being economically successful without being driven by monopolists and big businesses that are solely profit driven and which tend to be destructive to communities. There is the belief that the FM offers self regulation as opposed to interference from anyone and that the law of DS takes care of itself.

E. The Accurate Meaning

All of the meanings cited have some form of ideological viewpoint that is projected on the term FM and it always comes out in a way that is skewered and, when pushed to its logical conclusion, inconsistent and contradictory to say the least or has elements that tend to its own undermining and that of the society it operates in. An accurate way of looking at this with minimal distortion in the lens is to realize that the whole of notion of the FM is a fantasy as it is held by most.

All forces of DS are arbitrary. There is no law in economics similar to that of gravity (or as in physics). The idea of imposing man made laws as explanations for human behaviour and motivation is part of the misguided sense of all attempts to mechanistically control human beings who are wholly organic entities.

The space in which commodities are exchanged or are bought and sold can be called ‘the market’. But DS are quite arbitrary. Due to constant mismatching of DS and consumerism and the use of the media to create lust for things there is a constant state of disequilibrium and misallocation of resources. The deluded neo-classicists, of course, then claim that this is due to distortions to the idea of a prefect market (which would allow DS to operate the way it’s meant to!). But it is the silly idea of a ‘perfect market’ that is the distortion of reality or the world as it is.

The realities of the world when open to the arbitrary forces of DS and the profit motive cause the out of sync boom and bust nature of 'economic forces'. There is no FM but arbitrary forces trying to control things to their advantage. This selfishness and greed and amorality which are not only the key to Capitalism but are the empty core of all neo-classical utilitarian principled ideas that revolve around sense satisfaction alone. This is what the market and DS mean.

Left by itself, the FM simply degenerates into monopolies and the quest for dominance, violence and that which is empty of any human value. Greed and profit obsession is expressed through monetary units and status, it has nothing to do with human value which is immeasurable.

Market ‘corrections’ merely mean the unforgiving ruthless forces of selfishness, greed and amorality that ensure the ‘survival of the fittest’ or rather the survival of the most harmful or toxic of entities and activities. This is why the world is largely in the state it is in today. When we say the result of the FM leads to this, it is not the FM per se because the FM as we have seen is a myth. What is meant here are the driving forces of selfishness underlying the so-called ‘FM’ as it exists in our world channeled through its vicious ‘corrective’ and punishing ethos to create a world of endless suffering and environmental desecration.

The term FM has, alas, been nothing more than a place holder for so much that is reprehensible in humanity.

Enter: Adam Smith

Perhaps one of the most misunderstood thinkers of any time has been Adam Smith. What has been done in the name of that man is as shameful as what has been done in the name of Marx. While Marx’s great Capital was partly a response to The Wealth of Nations (WN), he had a much better appreciation of what Smith’s work was about than many after him. Marx insisted that most who promoted Capitalism in Smith’s name had misrepresented what the good Scotsman was saying. And Marx was right on the money.

The many who are FM fantasists and hard core Capitalists often thump WN as if it were holy writ and claim the kernel of their beliefs lie in that tome. To say that the FM, as has been discussed, was proposed by Smith is to genetically modify his ideas into a Frankenstein monster that is in the process of destroying its creators through the economic crisis of our time

It is important to know that prior to writing WN, Smith had written The Theory of Moral Sentiments (TMS). While the former is his best known work, the latter is perhaps his greatest work. Smith was not, thank heavens, an economist. He was a professor of moral philosophy. Think about that: a professor of moral philosophy. Hence, a work entitled TMS.

The key ideas in TMS are worth noting. They are even crucial to a proper understanding of WN. To Smith, human beings have sympathy with their fellow humans as in understanding what joy and pain mean in others because they have experienced it themselves. But there is much more to this. People have a moral conscience and know what is right and wrong. Smith says that no man who is himself at ease can see another on the rack and avoid sympathy with the sufferer’s plight.

But contrary to those who adulterate Smith’s ideas, he clearly believes in Divinity. He regularly refers to the Deity and God in TMS. He even mentions that God looks after the Universe which is benign, and while God’s will is beyond man’s comprehension, man is responsible for doing what is right on earth.

Here is an important passage from TMS, VI.II.49:

The administration of the great system of the universe, however, the care of the universal happiness of all rational and sensible beings, is the business of God and not of man. To man is allotted a much humbler department, but one much more suitable to the weakness of his powers, and to the narrowness of his comprehension; the care of his own happiness, of that of his family, his friends, his country: that he is occupied in contemplating the more sublime, can never be an excuse for his neglecting the more humble department; and he must not expose himself to the charge which Avidius Cassius is said to have brought, perhaps unjustly, against Marcus Antoninus; that while he employed himself in philosophical speculations, and contemplated the prosperity of the universe, he neglected that of the Roman empire. The most sublime speculation of the contemplative philosopher can scarce compensate the neglect of the smallest active duty.

This is one of the clearest indications Smith gives of a moral centre to the universe with God’s Order behind it; where man has his own sphere of responsibility in discharging his duty on earth together with his fellow humans in alignment with what is right. This is the grounded viewpoint of Smith that fills not just TMS but is the basis for WN.

It is clear that Smith believes that there is a difference between self interest and selfishness. He praises the former and denigrates the obvious. In no uncertain terms does Smith condemn unbridled greed, social injustice, anger, hatred and all things associated with negative human attitudes and behaviour.

Self interested man looks after his own welfare and is always trying to achieve his highest good in a decent, fair and reasonable manner; but by doing so he in turn automatically, irrespective as to whether he is conscious of it or not, serves the greater welfare and good of his society.

Lest there still be any doubts as to Smith’s theistic views and the role of providence in his social and economic ideas, these passages from TMS VI.II.44-45 (bold and italics mine) should be of use:

Though our effectual good offices can very seldom be extended to any wider society than that of our own country; our good-will is circumscribed by no boundary, but may embrace the immensity of the universe. We cannot form the idea of any innocent and sensible being, whose happiness we should not desire, or to whose misery, when distinctly brought home to the imagination, we should not have some degree of aversion. The idea of a mischievous, though sensible, being, indeed, naturally provokes our hatred: but the ill-will which, in this case, we bear to it, is really the effect of our universal benevolence. It is the effect of the sympathy which we feel with the misery and resentment of those other innocent and sensible beings, whose happiness is disturbed by its malice.

This universal benevolence, how noble and generous soever, can be the source of no solid happiness to any man who is not thoroughly convinced that all the inhabitants of the universe, the meanest as well as the greatest, are under the immediate care and protection of that great, benevolent, and all-wise Being, who directs all the movements of nature; and who is determined, by his own unalterable perfections, to maintain in it, at all times, the greatest possible quantity of happiness. To this universal benevolence, on the contrary, the very suspicion of a fatherless world, must be the most melancholy of all reflections; from the thought that all the unknown regions of infinite and incomprehensible space may be filled with nothing but endless misery and wretchedness. All the splendour of the highest prosperity can never enlighten the gloom with which so dreadful an idea must necessarily over-shadow the imagination; nor, in a wise and virtuous man, can all the sorrow of the most afflicting adversity ever dry up the joy which necessarily springs from the habitual and thorough conviction of the truth of the contrary system.

Smith goes on to further emphasise this view in TMS II.II.19:

In every part of the universe we observe means adjusted with the nicest artifice to the ends which they are intended to produce, and admire how everything is contrived for advancing the two great purposes of nature, the support of the individual and the propagation of the species…[and studying this leads us to admire] the wisdom of man, which in reality is the wisdom of God.

This pursuance of self interest is expected of man, that is his destiny to the way he leads his life on earth but this in turn seems to align his activity to the moral centre of the universe or God’s will. Smith explains this by trying to account for the way things tend to naturally fall into place through a sense of balance as in laws of nature. So behaving in the right manner for oneself which inadvertently or otherwise benefit others, tends to be in line with the natural moral law of the Universe. Smith uses the corollary of showing that if a person does not look after his own welfare and his highest good as in trying to be a responsible and reasonable member in an economy or society he is not looked upon favourably as he may not doing what is right.

Smith does believe in altruism but he prefers to justify it via a grounded pragmatic approach in which people do not have to be motivated to do good for its own sake. People would be more easily swayed to be good citizens when they realize that helping themselves and a sense of self reliance is how they best serve society, and that in turn creates a society that best serves their own interest.

When you now turn to WN written after the bedrock of Smith’s ideas had been established in TMS, his economic opus starts to make a lot more sense. WN in itself is a sprawling work with such variety of observations in it that it is easy to take any passage out of context and say this supports a general view of the world based on a peculiar view of Smith’s.

But what can hardly be doubted is that while Smith reiterates man’s drive for self interest, he contrasts it to the negative effects of selfishness repeatedly throughout the WN. Smith clearly condemns those who tend towards greed and exploitation, and insists on people being treated decently and fairly. He states how grabby monopolists try to undermine the interests of all others as in WN Book I.11.264 (bold and italics mine):

The interest of the dealers, however, in any particular branch of trade or manufactures,is always in some respects different from, and even opposite to, that of the public. To widen the market and to narrow the competition, is always the interest of the dealers. To widen the market may frequently be agreeable enough to the interest of the public; but to narrow the competition must always be against it, and can serve only to enable the dealers, by raising their profits above what they naturally would be, to levy, for their own benefit, an absurd tax upon the rest of their fellow-citizens. The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.

The passage speaks for itself despite the attempts of the ignorant and willful obfuscationists to present Smith as a creature from their own black lagoon.

Furthermore, in what may be one of the most memorable passages in WN, Smith describes the ghastly system of division of labour in a pin making industry. While there seems some form of efficiency in this mechanization of human beings as cogs in an industry, the dehumanization of the process is duly noted by Smith. No doubt a great deal of mechanical productivity ensues in a way, but the human cost of this so-called productivity is questioned.

While Marx and Engels went the extra miles and were more impassioned and dramatic in their portraiture of human exploitation and suffering during the industrial boom of their time, it is hard to deny that Smith’s insistence on human decency in economic growth may have urged them to outdo him in what was wrong with Capitalism.

The humane aspect of Smith is something hardcore capitalists hardly mention if they are even aware of it. After considering the moral sentiments in his work, it becomes clear that Smith does not support the belief by FM fantasists and hard core capitalists that he is their guru.

We will finally ‘put paid’ to the false claims of Smith being the promoter of the FM and Capitalism in what follows next.

That Invisible Thingamajig

Perhaps a key weapon of FM fantasists and hardcore capitalists has been the misuse and abuse of arguably the most famous term in economics: the “invisible hand”. It is an understatement to say that lots have been said and written about it. But so much of it has been to fit ideological obsessions of so many that an actual close look at what Smith was saying reveals something quite different altogether.

There are many takes on the Invisible Hand (IH). Four main types of interpretations will be looked at. The generic meaning of the IH is what is most cherished by the hard core fantasists: that the IH shows that an unregulated market, (yes, baby, the FM) in which there is minimal or non-interference from anyone (especially governments) provides a system of automatic equilibrium and matching of DS which not only satisfies everyone but is for the highest benefit of all with the greatest wealth creation possible.

And anytime anyone says “FM-Capitalism good, all else bad”: they follow it up with the chant “Adam Smith-IH”! When you mention the social consequences of Capitalism, the response is “don’t be a communist/socialist”, ‘greed is good’, human cost etc are just ‘externalities’. And then to round it up again, the all conclusive bang on the head or bullet between the eyes: “Adam Smith-IH”! -- and they blow the smoke from their pistols.

Sadly, this pathetic trite falsehood of what Smith meant with the IH has been handed down generations via irresponsible economic instructors to hapless students. Despite that, there have been a number of useful contributions as to what the IH is supposed to mean. But there are three other interpretations which are quite interesting and deserve closer notice.

For the record, the IH in Smith appears only thrice in his works first in The History of Astronomy (HA), next in TMS and finally, in WN. These days, there seems to be a growing trend in economists trying to distance themselves from overt FM fanaticism and capitalist trumpery. So the current view among some economists seems to be that Smith’s use of the IH is more a passing phenomena that is interesting at best, or a baubley trinket at worst.

On to the three interpretations of which Gavin Kennedy’s Adam Smith and the Invisible Hand: From Metaphor to Myth sits happily in the extremity of its claims that the IH, if not just an example of Smith’s wry humour, is but a random term given undue attention. Kennedy starts off promisingly on how the IH is merely a metaphor and shows that it is quite possible that Smith only intended the term to emphasise a system that operates well on its own without interference including any invisible assistance emanating from a mystical or religious source.

Kennedy almost pulls off his escapade except that claiming the IH is pure metaphor for the obvious actions of self regulating human behaviour does not quite work (as will examined later); and that he forgets, after admitting the distinction, that there is a clear difference for Smith between self interest and selfishness.

There is the even more interesting reply to Kennedy by Daniel Klein In Adam Smith’s Invisible Hands: Comment on Gavin Kennedy. He prefers to see the “mystery” in Smith and not give in to the prosaic justifications of Kennedy. But Klein believes that the IH is more to do with explaining the self regulating, cooperative activity that takes place between people and which occurs naturally when tending to one’s mutual interests.

Klein thinks that Smith’s ideas take place within a spontaneous order of natural liberty that is unknowable in its particulars (part of the delectable mystery). He insists that teachers of economics make clear to students the wonder to be found within economic principles (while implicitly making clear that there is no Divine Order behind any of this). We will look at this closer later.

Klein then becomes like Kennedy in misreading Smith by stating that the IH in TMS is “a terrible muddle”. He strangely goes on to say that the IH occurrence in WN is less muddled but “not without its mysteries”. Neither is he sure if the IH is “a tag for the comparative merit of freedom”.

The only mystery here is how muddled economists are on what Smith said and in particular what was meant by the IH.

But the most fascinating piece is by Paul Oslington called Divine Action, Providence and Adam Smith’s Invisible Hand . After having myself subscribed to ideas as absurd as what has generally been said of Smith, a rethink was caused by Oslington’s insightful view.

Osilington starts off with how Isaac Newton’s ideas affected Smith who even wrote his HA due to this influence. Newton, perhaps more than Einstein, believed that God does not play dice with the universe and that providence allowed for natural laws to keep the universe in order. But irregular events in the universe were also taken care of by special providence in that it allowed for Divine adjustments to take place and keep the natural order of things. It is this aspect of special providence that is said to have been adopted by Smith.

In his HA Smith mentions how the regularity of natural events like the sun rising and setting is hardly questioned by men during early polytheistic times, but only irregular events are noted like meteor sightings. The IH of Jupiter (king of the Roman gods) was not, says Smith, seen as the influence of regular events (as they were taken for granted); but some otherworldly influence comes into play in order to explain irregular events (e.g., eclipses).

To Oslington what this shows is that Smith was developing an idea to explain how man comes to understand that all events, irregular or otherwise in the cosmos, have divine order attached to it. This Smith then goes on to develop more fully in his later works.

In TMS, Smith talks about how a rich landowner cannot hoard everything he has for himself without ensuring that those who serve him have enough to live on as well, so that they can go on serving him. This leads to the rich man sharing, led by the IH, what he has to ensure everyone gains something, so that despite himself, he has helped the rest of society.

Oslington explains it well as:

The hand here is working against the rapacity of the rich, levelling out consumption, and maintaining the stability of the system. Smith understands that the stability [of] a market economy depends on a modicum of justice and not too obscenely unequal a distribution of consumption. This is why the hand intervening to restrain the consumption of the rich serves to maintain the stability of the market system. In Smith’s providential scheme it is special providence, balancing the general providential force of self interest in markets. (p 9).

But to me, the passage below in TMS is central to understanding Smith and his IH and how it is meant to be understood in its famous occurrence in WN. Here is the passage almost in full and in context -- part IV Section 1 paragraphs 10-11 (bold and italics are mine):

And it is well that nature imposes upon us in this manner. It is this deception which rouses and keeps in continual motion the industry of mankind. It is this which first prompted them to cultivate the ground, to build houses, to found cities and commonwealths, and to invent and improve all the sciences and arts, which ennoble and embellish human life; which have entirely changed the whole face of the globe, have turned the rude forests of nature into agreeable and fertile plains, and made the trackless and barren ocean a new fund of subsistence, and the great high road of communication to the different nations of the earth. The earth by these labours of mankind has been obliged to redouble her natural fertility, and to maintain a greater multitude of inhabitants. It is to no purpose, that the proud and unfeeling landlord views his extensive fields, and without a thought for the wants of his brethren, in imagination consumes himself the whole harvest that grows upon them. The homely and vulgar proverb, that the eye is larger than the belly, never was more fully verified than with regard to him. The capacity of his stomach bears no proportion to the immensity of his desires, and will receive no more than that of the meanest peasant. The rest he is obliged to distribute among those, who prepare, in the nicest manner, that little which he himself makes use of, among those who fit up the palace in which this little is to be consumed, among those who provide and keep in order all the different baubles and trinkets, which are employed in the oeconomy of greatness; all of whom thus derive from his luxury and caprice, that share of the necessaries of life, which they would in vain have expected from his humanity or his justice. The produce of the soil maintains at all times nearly that number of inhabitants which it is capable of maintaining. The rich only select from the heap what is most precious and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species. When Providence divided the earth among a few lordly masters, it neither forgot nor abandoned those who seemed to have been left out in the partition. These last too enjoy their share of all that it produces. In what constitutes the real happiness of human life, they are in no respect inferior to those who would seem so much above them. In ease of body and peace of mind, all the different ranks of life are nearly upon a level, and the beggar, who suns himself by the side of the highway, possesses that security which kings are fighting for.

IV.I.11

The same principle, the same love of system, the same regard to the beauty of order, of art and contrivance, frequently serves to recommend those institutions which tend to promote the public welfare. When a patriot exerts himself for the improvement of any part of the public police, his conduct does not always arise from pure sympathy with the happiness of those who are to reap the benefit of it. It is not commonly from a fellow-feeling with carriers and waggoners that a public-spirited man encourages the mending of high roads. When the legislature establishes premiums and other encouragements to advance the linen or woollen manufactures, its conduct seldom proceeds from pure sympathy with the wearer of cheap or fine cloth, and much less from that with the manufacturer or merchant. The perfection of police, the extension of trade and manufactures, are noble and magnificent objects. The contemplation of them pleases us, and we are interested in whatever can tend to advance them. They make part of the great system of government, and the wheels of the political machine seem to move with more harmony and ease by means of them. We take pleasure in beholding the perfection of so beautiful and grand a system, and we are uneasy till we remove any obstruction that can in the least disturb or encumber the regularity of its motions. All constitutions of government, however, are valued only in proportion as they tend to promote the happiness of those who live under them. This is their sole use and end. From a certain spirit of system, however, from a certain love of art and contrivance, we sometimes seem to value the means more than the end, and to be eager to promote the happiness of our fellow-creatures, rather from a view to perfect and improve a certain beautiful and orderly system, than from any immediate sense or feeling of what they either suffer or enjoy. There have been men of the greatest public spirit, who have shown themselves in other respects not very sensible to the feelings of humanity. And on the contrary, there have been men of the greatest humanity, who seem to have been entirely devoid of public spirit. Every man may find in the circle of his acquaintance instances both of the one kind and the other. Who had ever less humanity, or more public spirit, than the celebrated legislator of Muscovy? The social and well-natured James the First of Great Britain seems, on the contrary, to have had scarce any passion, either for the glory or the interest of his country. Would you awaken the industry of the man who seems almost dead to ambition, it will often be to no purpose to describe to him the happiness of the rich and the great; to tell him that they are generally sheltered from the sun and the rain, that they are seldom hungry, that they are seldom cold, and that they are rarely exposed to weariness, or to want of any kind. The most eloquent exhortation of this kind will have little effect upon him. If you would hope to succeed, you must describe to him the conveniency and arrangement of the different apartments in their palaces; you must explain to him the propriety of their equipages, and point out to him the number, the order, and the different offices of all their attendants. If any thing is capable of making impression upon him, this will. Yet all these things tend only to keep off the sun and the rain, to save them from hunger and cold, from want and weariness. In the same manner, if you would implant public virtue in the breast of him who seems heedless of the interest of his country, it will often be to no purpose to tell him, what superior advantages the subjects of a well-governed state enjoy; that they are better lodged, that they are better clothed, that they are better fed. These considerations will commonly make no great impression. You will be more likely to persuade, if you describe the great system of public police which procures these advantages, if you explain the connexions and dependencies of its several parts, their mutual subordination to one another, and their general subserviency to the happiness of the society; if you show how this system might be introduced into his own country, what it is that hinders it from taking place there at present, how those obstructions might be removed, and all the several wheels of the machine of government be made to move with more harmony and smoothness, without grating upon one another, or mutually retarding one another's motions. It is scarce possible that a man should listen to a discourse of this kind, and not feel himself animated to some degree of public spirit. He will, at least for the moment, feel some desire to remove those obstructions, and to put into motion so beautiful and so orderly a machine. Nothing tends so much to promote public spirit as the study of politics, of the several systems of civil government, their advantages and disadvantages, of the constitution of our own country, its situation, and interest with regard to foreign nations, its commerce, its defence, the disadvantages it labours under, the dangers to which it may be exposed, how to remove the one, and how to guard against the other. Upon this account political disquisitions, if just, and reasonable, and practicable, are of all the works of speculation the most useful. Even the weakest and the worst of them are not altogether without their utility. They serve at least to animate the public passions of men, and rouse them to seek out the means of promoting the happiness of the society.

What in summary does this important passage say:

the rich and wealthy usually are more selfishly inclined than most and could hardly be bothered with the welfare of those less fortunate
but in order to stay their course they need to let their serfs survive as well and so inadvertently or otherwise ensure their serfs’ survival thereby benefiting the welfare of others
in making this distribution of things to those lower in the food chain, the rich are led into this by the IH
man proposes (as in the selfishness of the rich) but providence disposes, as in the balance that ensures some form of fairness to the less well off
all humans want happiness and all are equal in that respect of wanting peace and solace as well other than the illusory difference produced by status and the master-slave relationship thereof
with a touch of irony, Smith says even a beggar sunning himself seems to have as much, if not more, peace of mind than kings (who constantly worry about who is about to do them in, etc)
the balance and seemingly smooth operation of the IH behind the adjustments in society is the same kind of system that when it appears in the general governance of society appeals to a sense of order and artistry which humans have a bias for
when someone supports the idea of good governance and commerce in his society it is not always out of sympathy for his fellow man
people tend to be impressed with the smooth automatic functioning of a state and all that takes place within it as it resonates with a sense of balance, harmony and artistry in us
while we acknowledge that the purpose of government is to ensure citizens’ happiness, we tend to be more appreciative of the well oiled functioning of things rather than whether all of society benefits from this
a person is not so much concerned with what public policies etc are for the benefit of his fellow citizens as much as realizing the remarkable way his society functions and how it is something that is wondrous and (implicit in this) perhaps worthy of emulation by others: this makes him interested to ensure the well oiled functioning of his society
if the proper and effective operation of a country can be justified via just, reasonable and practicable ways, people may be inspired to seek the means of seeking the happiness of their society

It is important to note that in TMS Smith seems to be saying four things:

First, that through sympathy with his fellow man and through serving one’s self interest a person tends to serve, often times inadvertently, the interests of society.

Second, the above tends to happen because it is aligned to a force of balance that resonates with the moral centre of the universe which ensures regularity in human affairs. We usually don’t question this but take it as a given, knowingly or otherwise.

Third, and importantly, even if an irregularity occurs such as man serving his own selfish interests as opposed to his self interest, there is an IH that rebalances accordingly to ensure that there is some form of redress and justice in distribution to ensure that those exploited still manage to subsist.

Fourth, that people seem to be caught up more with the artistry and smooth functioning of things (that is, regularity and order) than whether society actually gains from this. And if this mode of smooth operation can be justified in a manner of justice and fairness, then people will buy into it and thereby, against their will at times, end up benefiting society at large.

In many cases, we have experienced situations where people compare one society and economy with another over an excellent transportation system, well maintained public amenities, health and educational facilities that are people friendly, etc. In most instances, we also wonder why we can’t have what works smoothly and well in other countries in our own, and are willing to ask or push for, or work towards manifesting this in our own societies. In this, Smith has given an accurate description of things which resonates with many of us today.

It is clear to me, that Smith has ideas here that both Immanuel Kant and John Rawls would have been fascinated by. More will be said of this, especially of the influence Smith has on Rawls.

The third point on how the IH comes in to readjust seeming irregularity in the general balance of things is consonant with what Oslington claims it does in terms of special providence. But Oslington does not mention clearly enough how the irregularity occurs: it occurs because even selfishness vis-à-vis self interest gets the touch of natural re-balancing to even things out a little. In all this, it appears Smith is far more consistent in his thinking on the IH than many thought him to be.

When it comes to WN, Oslington mentions that special providence also comes in again to ensure that despite greater profits available through trade abroad, the merchant paradoxically keeps capital at home thereby benefiting the home front. But as a close reading of that particular passage in WN shows, Oslington and others are not quite right about thinking that is how the irregularity appears. The irregularity in WN in relation to the IH arises from the ambiguity in what Smith says (we will look at this).

But in case there is still some doubt as to the moral core and Divine Order spiralling through Smith’s work, this brilliant passage with its take on capital punishment must be looked at in TMS Book 2.II.19-III.27 (bold and italics mine). It also reiterates with consistency the idea running through TMS and WN in relation to special providence acting through irregularities in the world as in the case of the IH:

Upon some occasions, indeed, we both punish and approve of punishment, merely from a view to the general interest of society, which, we imagine, cannot otherwise be secured. Of this kind are all the punishments inflicted for breaches of what is called either civil police, or military discipline. Such crimes do not immediately or directly hurt any particular person; but their remote consequences, it is supposed, do produce, or might produce, either a considerable inconveniency, or a great disorder in the society. A centinel, for example, who falls asleep upon his watch, suffers death by the laws of war, because such carelessness might endanger the whole army. This severity may, upon many occasions, appear necessary, and, for that reason, just and proper. When the preservation of an individual is inconsistent with the safety of a multitude, nothing can be more just than that the many should be preferred to the one. Yet this punishment, how necessary soever, always appears to be excessively severe. The natural atrocity of the crime seems to be so little, and the punishment so great, that it is with great difficulty that our heart can reconcile itself to it. Though such carelessness appears very blamable, yet the thought of this crime does not naturally excite any such resentment, as would prompt us to take such dreadful revenge. A man of humanity must recollect himself, must make an effort, and exert his whole firmness and resolution, before he can bring himself either to inflict it, or to go along with it when it is inflicted by others. It is not, however, in this manner, that he looks upon the just punishment of an ungrateful murderer or parricide. His heart, in this case, applauds with ardour, and even with transport, the just retaliation which seems due to such detestable crimes, and which, if, by any accident, they should happen to escape, he would be highly enraged and disappointed. The very different sentiments with which the spectator views those different punishments, is a proof that his approbation of the one is far from being founded upon the same principles with that of the other. He looks upon the centinel as an unfortunate victim, who, indeed, must, and ought to be, devoted to the safety of numbers, but whom still, in his heart, he would be glad to save; and he is only sorry, that the interest of the many should oppose it. But if the murderer should escape from punishment, it would excite his highest indignation, and he would call upon God to avenge, in another world, that crime which the injustice of mankind had neglected to chastise upon earth.

For it well deserves to be taken notice of, that we are so far from imagining that injustice ought to be punished in this life, merely on account of the order of society, which cannot otherwise be maintained, that Nature teaches us to hope, and religion, we suppose, authorises us to expect, that it will be punished, even in a life to come. Our sense of its ill desert pursues it, if I may say so, even beyond the grave, though the example of its punishment there cannot serve to deter the rest of mankind, who see it not, who know it not, from being guilty of the like practices here. The justice of God, however, we think, still requires, that he should hereafter avenge the injuries of the widow and the fatherless, who are here so often insulted with impunity. In every religion, and in every superstition that the world has ever beheld, accordingly, there has been a Tartarus as well as an Elysium; a place provided for the punishment of the wicked, as well as one for the reward of the just.

Nature, however, when she implanted the seeds of this irregularity in the human breast, seems, as upon all other occasions, to have intended the happiness and perfection of the species. If the hurtfulness of the design, if the malevolence of the affection, were alone the causes which excited our resentment, we should feel all the furies of that passion against any person in whose breast we suspected or believed such designs or affections were harboured, though they had never broke out into any action. Sentiments, thoughts, intentions, would become the objects of punishment; and if the indignation of mankind run as high against them as against actions; if the baseness of the thought which had given birth to no action, seemed in the eyes of the world as much to call aloud for vengeance as the baseness of the action, every court of judicature would become a real inquisition. There would be no safety for the most innocent and circumspect conduct. Bad wishes, bad views, bad designs, might still be suspected; and while these excited the same indignation with bad conduct, while bad intentions were as much resented as bad actions, they would equally expose the person to punishment and resentment. Actions, therefore, which either produce actual evil, or attempt to produce it, and thereby put us in the immediate fear of it, are by the Author of nature rendered the only proper and approved objects of human punishment and resentment. Sentiments, designs, affections, though it is from these that according to cool reason human actions derive their whole merit or demerit, are placed by the great Judge of hearts beyond the limits of every human jurisdiction, and are reserved for the cognizance of his own unerring tribunal. That necessary rule of justice, therefore, that men in this life are liable to punishment for their actions only, not for their designs and intentions, is founded upon this salutary and useful irregularity in human sentiments concerning merit or demerit, which at first sight appears so absurd and unaccountable. But every part of nature, when attentively surveyed, equally demonstrates the providential care of its Author, and we may admire the wisdom and goodness of God even in the weakness and folly of man.

It is even of considerable importance, that the evil which is done without design should be regarded as a misfortune to the doer as well as to the sufferer. Man is thereby taught to reverence the happiness of his brethren, to tremble lest he should, even unknowingly, do any thing that can hurt them, and to dread that animal resentment which, he feels, is ready to burst out against him, if he should, without design, be the unhappy instrument of their calamity. As, in the ancient heathen religion, that holy ground which had been consecrated to some god, was not to be trod upon but upon solemn and necessary occasions, and the man who had even ignorantly violated it, became piacular from that moment, and, until proper atonement should be made, incurred the vengeance of that powerful and invisible being to whom it had been set apart; so, by the wisdom of Nature, the happiness of every innocent man is, in the same manner, rendered holy, consecrated, and hedged round against the approach of every other man; not to be wantonly trod upon, not even to be, in any respect, ignorantly and involuntarily violated, without requiring some expiation, some atonement in proportion to the greatness of such undesigned violation. A man of humanity, who accidentally, and without the smallest degree of blamable negligence, has been the cause of the death of another man, feels himself piacular, though not guilty. During his whole life he considers this accident as one of the greatest misfortunes that could have befallen him. If the family of the slain is poor, and he himself in tolerable circumstances, he immediately takes them under his protection, and, without any other merit, thinks them entitled to every degree of favour and kindness. If they are in better circumstances, he endeavours by every submission, by every expression of sorrow, by rendering them every good office which he can devise or they accept of, to atone for what has happened, and to propitiate, as much as possible, their, perhaps natural, though no doubt most unjust resentment, for the great, though involuntary, offence which he has given them.

What Smith in essence is saying here is that most people while understanding why capital punishment was meted out to the sentry who falls asleep at his post, would still see it as an extreme measure. The same people would have a sense of outrage that would support a capital sentence on someone who commits a heinous crime like parricide, and in our time, mass murder. People can be so enraged that they may also believe such punishment to go beyond mortal realms to punishment in the after life as some form of universal retribution.

But Smith says that this apparent inconsistency or irregularity in views of people as to who deserves punishment is something that should be determined not from their thoughts but by their actions. He believes that if people were to judge others based on their thoughts and potential for thinking evil as opposed to someone caught in the act of enacting the thought, then there would be no end to inquisitions throughout society. (This would be equivalent to a type of ‘thought crime’ in Orwell’s great Nineteen Eighty Four).

Judgment of what happens in the human heart is not for man to make as it is in the province of the Divine. Humans can look at actions and determine the nature of them thereby making judgments on that. We can judge on actions, but not on thoughts or we will want accounting for every negative human thought even when it doesn’t result in any harm to anyone. The sentry, though his intentions were not based on malice, is judged based on the fact that his lack of alertness could have dire consequences for all.

If there appears any irregularity in this aspect of human judgment and thinking as to how people react to punishment, it is a good thing which prevents ‘witch hunts’ and allows for some semblance of order in society. To Smith this falling into place of things naturally despite the irregularity in response to, for instance, capital punishment, is due to the special providential adjustment of Divinity.

Smith is not proposing here a system of legal justice and how a judiciary should work. He is commenting on the moral and social nature of man in relation to the Divine and how we operate in our daily lives.

Then as is typical of Smith, he provides a countervailing view to show that there are instances of intention in humans that must be considered as in the case of someone who did not have intent to cause suffering to others but does so as in accidentally causing someone’s death. There is atonement that is necessary though he is not culpable for what happened. The sanctity of a human being and his innocence cannot be infringed upon under any circumstances especially via some form of revenge.

In doing this, as he does in many instances, Smith does his best to explore the complexities in human affairs and tries to show that they are consistently taken care of via a kind of natural balance, harmony and adjustment that takes place in the universe, world, and society which is the underlying Divine Order for the good of all.

In using this approach, Smith seems to be allowing for the rationalisation of how we act and react to things in line with the greater architectonic of Divine Order.

All apparent irregularities are Divine ways of adjusting the seemingly imperfect into perfection. That is principally the phenomenon of the IH. There is hardly a coincidence in Smith using the phrase “as upon all other occasions” relating to irregularity above from TMS with the mention of “as in many other cases” together with the operation of the IH in WN – as in the passage below.

In both cases, the occurrence of the IH as special providence making adjustments for the good of all is a regular and natural phenomenon.

Now take a detailed look at the passage where perhaps the most famous term in economics finally appears in WN Book 4 chapter 2 (bold and italics are mine):

IV.2.1

By restraining, either by high duties or by absolute prohibitions, the importation of such goods from foreign countries as can be produced at home, the monopoly of the home market is more or less secured to the domestic industry employed in producing them. Thus the prohibition of importing either live cattle or salt provisions from foreign countries secures to the graziers of Great Britain the monopoly of the home market for butcher's meat. The high duties upon the importation of corn, which in times of moderate plenty amount to a prohibition, give a like advantage to the growers of that commodity. The prohibition of the importation of foreign woollens is equally favourable to the woollen manufacturers. The silk manufacture, though altogether employed upon foreign materials, has lately obtained the same advantage. The linen manufacture has not yet obtained it, but is making great strides towards it. Many other sorts of manufacturer have, in the same manner, obtained in Great Britain, either altogether or very nearly, a monopoly against their countrymen. The variety of goods of which the importation into Great Britain is prohibited, either absolutely, or under certain circumstances, greatly exceeds what can easily be suspected by those who are not well acquainted with the laws of the customs.

IV.2.2

That this monopoly of the home-market frequently gives great encouragement to that particular species of industry which enjoys it, and frequently turns towards that employment a greater share of both the labour and stock of the society than would otherwise have gone to it, cannot be doubted. But whether it tends either to increase the general industry of the society, or to give it the most advantageous direction, is not, perhaps, altogether so evident.

IV.2.3

The general industry of the society never can exceed what the capital of the society can employ. As the number of workmen that can be kept in employment by any particular person must bear a certain proportion to his capital, so the number of those that can be continually employed by all the members of a great society must bear a certain proportion to the whole capital of that society, and never can exceed that proportion. No regulation of commerce can increase the quantity of industry in any society beyond what its capital can maintain. It can only divert a part of it into a direction into which it might not otherwise have gone; and it is by no means certain that this artificial direction is likely to be more advantageous to the society than that into which it would have gone of its own accord.

IV.2.4

Every individual is continually exerting himself to find out the most advantageous employment for whatever capital he can command. It is his own advantage, indeed, and not that of the society, which he has in view. But the study of his own advantage naturally, or rather necessarily, leads him to prefer that employment which is most advantageous to the society.

IV.2.5

First, every individual endeavours to employ his capital as near home as he can, and consequently as much as he can in the support of domestic industry; provided always that he can thereby obtain the ordinary, or not a great deal less than the ordinary profits of stock.

IV.2.6

Thus, upon equal or nearly equal profits, every wholesale merchant naturally prefers the home-trade to the foreign trade of consumption, and the foreign trade of consumption to the carrying trade. In the home-trade his capital is never so long out of his sight as it frequently is in the foreign trade of consumption. He can know better the character and situation of the persons whom he trusts, and if he should happen to be deceived, he knows better the laws of the country from which he must seek redress. In the carrying trade, the capital of the merchant is, as it were, divided between two foreign countries, and no part of it is ever necessarily brought home, or placed under his own immediate view and command. The capital which an Amsterdam merchant employs in carrying corn from Konigsberg to Lisbon, and fruit and wine from Lisbon to Konigsberg, must generally be the one half of it at Konigsberg and the other half at Lisbon. No part of it need ever come to Amsterdam. The natural residence of such a merchant should either be at Konigsberg or Lisbon, and it can only be some very particular circumstances which can make him prefer the residence of Amsterdam. The uneasiness, however, which he feels at being separated so far from his capital generally determines him to bring part both of the Konigsberg goods which he destines for the market of Lisbon, and of the Lisbon goods which he destines for that of Konigsberg, to Amsterdam: and though this necessarily subjects him to a double charge of loading and unloading, as well as to the payment of some duties and customs, yet for the sake of having some part of his capital always under his own view and command, he willingly submits to this extraordinary charge; and it is in this manner that every country which has any considerable share of the carrying trade becomes always the emporium, or general market, for the goods of all the different countries whose trade it carries on. The merchant, in order to save a second loading and unloading, endeavours always to sell in the home-market as much of the goods of all those different countries as he can, and thus, so far as he can, to convert his carrying trade into a foreign trade of consumption. A merchant, in the same manner, who is engaged in the foreign trade of consumption, when he collects goods for foreign markets, will always be glad, upon equal or nearly equal profits, to sell as great a part of them at home as he can. He saves himself the risk and trouble of exportation, when, so far as he can, he thus converts his foreign trade of consumption into a home-trade. Home is in this manner the centre, if I may say so, round which the capitals of the inhabitants of every country are continually circulating, and towards which they are always tending, though by particular causes they may sometimes be driven off and repelled from it towards more distant employments. But a capital employed in the home-trade, it has already been shown, necessarily puts into motion a greater quantity of domestic industry, and gives revenue and employment to a greater number of the inhabitants of the country, than an equal capital employed in the foreign trade of consumption: and one employed in the foreign trade of consumption has the same advantage over an equal capital employed in the carrying trade. Upon equal, or only nearly equal profits, therefore, every individual naturally inclines to employ his capital in the manner in which it is likely to afford the greatest support to domestic industry, and to give revenue and employment to the greatest number of people of his own country.

IV.2.7

Secondly, every individual who employs his capital in the support of domestic industry, necessarily endeavours so to direct that industry that its produce may be of the greatest possible value.

IV.2.8

The produce of industry is what it adds to the subject or materials upon which it is employed. In proportion as the value of this produce is great or small, so will likewise be the profits of the employer. But it is only for the sake of profit that any man employs a capital in the support of industry; and he will always, therefore, endeavour to employ it in the support of that industry of which the produce is likely to be of the greatest value, or to exchange for the greatest quantity either of money or of other goods.

IV.2.9

But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.

What in essence does the passage say:

domestic industries can be protected by trade tariffs on imports

that domestic monopolies may result due to this but government may be in cahoots with local industries in doing so to the disadvantage of citizens

that this tendency to profit taking via monopoly tends to reallocate resources to serve monopolistic interests and the benefit of which, to the country, is ambiguous

some form of interference can see to the reallocation of capital away from monopolistic tendencies but it is uncertain as to the benefit that arises from such moves

individuals who seem to pursue self interest in the way they allocate their capital may, in effect, actually be benefiting society without their knowing

merchants would on the whole prefer to keep capital at home because they can monitor its progress and gains better that way

this results in the home country of a merchant engaged in export trade to also having a variety of that produce sold there as long as some form of profit taking can be managed in the process

since most gain seems to arise from deploying capital within the home country there is a tendency for capital to be kept home which results in industry and employment growing and revenues rising

those who adopt this strategy will want to see that the produce of such industries be of the greatest value

in such a deployment of capital the merchant intends to gain the maximum profit he can

through such moves of maximizing profit the revenue in a country is increased and the motivation behind this is not related to society’s benefitting consciously or otherwise

by supporting domestic industry in this manner over foreign ones the merchant is only pursuing his own interest

via this mode of operation he seems to be led by an IH to promote an end which was by no means his original intention

he ends up promoting society’s interests more than he would have if his intention was to serve mainly society’s interests

not much good arises from commercial transactions that are solely for society’s good

It would be hard to prove that Smith does not here advocate keeping capital at home as opposed to investing it overseas. But there is more in all this than just that. This passage is one of many that are ambiguous in WN. Yet within the ambiguity lies the special providence that accounts for the irregularity that accompanies the use of the IH. How does this ambiguity work?

From (1) – (3) we see that merchants are quite happy to exploit cornering the domestic market to set up some form of monopoly aided by government tariffs on imports. This is consistent with the reading of selfishness (as opposed to self interest) of those tending toward monopolies. There is no doubt that Smith is against the selfishness that stems from monopoly and greed as shown earlier with the quote on the critical clash of interests in Book I.

But with (4) the transition to ambiguity begins as Smith says interference to regulate some of this monopoly is not always advantages. In (5) the ambiguity comes full circle as Smith implies that even with monopolistic ambition allocation of capital may be for everyone’s good. This is the ambiguous merger of selfishness and self interest which can sometimes describe what does happen in reality. The rest of the passage shows how the tendency to maximize profits through favouring domestic to foreign industries leads to greater produce, labour and revenue for the home country.

So even if the merchant is driven by selfishness or a mixture of self interest and selfishness -- hence the irregularity -- the special providence of the IH steps in to adjust things such that society gains even when the intention of such societal good wasn’t there in the first place. This is consistent with the irregularity of selfishness in the TMS that also sees the IH adjust things such that everyone gains all round.

Not much good arises from commercial ventures that work consciously to solely benefit everyone as an end in itself. So it becomes clear that there is a kind of teleology to Smith and a natural order to things in a Divinely guided universe with a moral center: that while self interest ensures smooth functioning of things in a society, the imbalance of selfishness is also readjusted into a kind of balance that is in the end for the good of all.

This does not imply that overtly destructive activities like rampant monopolies and the ills of capitalism as we know through hindsight, and still live through today, will have the IH come in and rescue everyone. There will be consequences for bad actions and they are inescapable just as the consequences of war result in unimaginable human suffering.

Yet under Smith’s scheme of things, the broad architecture of the universe with its Divine Order and moral center will still see a balance come into play, as life does go on albeit sometimes on quite a different paradigm.

Sergio Leone Does Adam Smith

Before looking at the issue of markets again and how the so-called Free Market has no relation to what Smith was talking about, it is worth looking at the relevance and application of the IH notion of adjusting irregularities as special providence. So far, Smith’s examples as used here may seem a little abstract but his ideas are far more potent for reasons beyond the claims of FM fantasists and hard core Capitalists.

Take look at A Fistful of Dollars. When Eastwood, or the man with no name, pits one rival faction against the other in the nihilistic town he visits, he is only interested in earning money. He amorally and immorally manipulates and shoots his way into earning his coins. But he decides to help the wronged woman kept as a mistress by the villain of the piece (Gian Maria Volonte) and unites her with her son and husband. In the process he kills her captors and even gives all the money he has to help and her family.

As a result Eastwood pays a terrible price; but on the mend from his punishment he invokes a revenge that brings down total destruction on the rival clans. As Smith says, when Eastwood pursues his own interest (mixed up with greed and a trigger happy style) he ironically -- against his own intentions -- ends up helping the woman and her family, starts a chain of events that rids the town of its corruption thereby playing an unwitting balancing force that allows the town to start anew.

It is almost like there is an IH that sweeps through the drama to provide some form adjustment via the irregularity of self interest and selfishness of the Eastwood character. Just as in Kurosawa’s original masterpiece Yojimbo on which Leone based his film, Leone’s “Dollars Trilogy” and the ones that follow it have a moral centre.

The other fascinating instance is in a Leone film called A Fistful of Dynamite, but now in its fully restored version is known as Duck, You Sucker. James Coburn plays a weary Irish Republican Army man running from his past who ends up teaming up with a notorious bandit, played by Rod Steiger, in Mexico. Though each pursues their self interest and in the case of Steiger, his greed: they both despite trying to avoid getting caught up in the Mexican Revolution end up doing just that. In the process they help the revolutionists fight the fascists of their time through set pieces of violence.

Again, in the most unlikely manner a balance is restored as the characters follow their interests and destinies to the end under the Direction of a greater force, as if by an IH.

Also, on a more personal note, I have rarely (in the Smithian sense) managed to persuade someone to a cause by telling them that it is for the good of humanity. But on explaining to them how this would be in their interest to do so, and that of their close ones, have managed to get people involved in good causes. In that process they bring others onboard and before long a virtuous cycle is created of getting done that which, in the medium to long term, benefits the environment, society and/or the underprivileged. This process happens automatically and adjusts itself accordingly almost as if guided, as in most other cases, by an IH.

And Justice For All

Let us come back to the so-called markets. As can be seen Smith was not promoting Capitalism. Neither was he promoting a so-called Free Market. The idea of the FM is not only a contradiction in terms but does not allow any notion of balance and fairness to come into play. By now we can see that Smith was more concerned with a social-economic system that promoted balance and harmony rather than the free-wheeling framework of wildly shifting disequilibriums promulgated by Capitalism and neo-classical economics.

Back to another passage in TMS, where Smith writes in I.I.36 (bold and italics mine):

To see the emotions of their hearts, in every respect, beat time to his own, in the violent and disagreeable passions, constitutes his sole consolation. But he can only hope to obtain this by lowering his passion to that pitch, in which the spectators are capable of going along with him. He must flatten, if I may be allowed to say so, the sharpness of its natural tone, in order to reduce it to harmony and concord with the emotions of those who are about him. What they feel, will, indeed, always be, in some respects, different from what he feels, and compassion can never be exactly the same with original sorrow; because the secret consciousness that the change of situations, from which the sympathetic sentiment arises, is but imaginary, not only lowers it in degree, but, in some measure, varies it in kind, and gives it a quite different modification. These two sentiments, however, may, it is evident, have such a correspondence with one another, as is sufficient for the harmony of society. Though they will never be unisons, they may be concords, and this is all that is wanted or required.

What this passage encapsulates is the sympathetic vibrations of energy people tend to set up in relation to one another in functioning together as a group of people or society. Emotions and thoughts are adjusted through conscious or unconscious effort when collaboration and consensus is being built to move things forward. A strident tone, no matter how justified, tends to lose support, hence, the need to “flatten…the sharpness” to get some form of harmony among people. Consensus building is a good thing.

This is radically opposed to the rampant egoistic obsessions that many ideas of Capitalism and the FM tend to promote. Smith’s ideas have to do with people getting along not through compromising of values, but by consensus building. Which also means it eschews insistence of things through the barrel of a gun (and the ideologies that go with it).

Smith, in always trying to keep things real, makes it clear that the process of consensus building and cooperative ventures do not create unisons so much as concords and that, indeed, is as good as it gets. It is analogous, in a way, to unity in diversity, or vice versa. Individual identities and ideas are kept but they are adjusted to see what in common can get things working. This somehow resonates with most people’s idea of democracy.

This does not imply being able to suddenly propose revolutionary ideas that can shift paradigms to a new level, but on a closer look this paradigm shift may be achieved through the use of persuasion, and convincing others of how it benefits them individually etc that result in ideas for the good of all.

This contrasts with the jaded and predictable manner that extremists and hard core Capitalists do things. It always has the use of force underlying it or overlaying it or pointed at you in the form a gun. Apparently, that’s a sign of freedom and the way to keep it going. Naturally, when you rob others’ land, property, livelihoods, families, life blood and consciences for the sake of selfishness and blind capital accumulation you have to do it through force and keep it via domestic and international violence.

But as Smith says, even such irregularities from what can be seen as regular peaceable behaviour between peoples is given balance and readjustment which sees a reordering of society. Hence, the current economic crisis sweeping the world which while causing so much problems for us, is the cleansing process which will bring down the old, corrupt, violence drenched past that will get us to work together inevitably to issue in a new age of peace, harmony and prosperity which may also have existed in other times not subject to the ‘officially’ promulgated history of the world.

This process of building ideas up to principles that can be used or applied throughout a society is a process of social constructivism that in a way is in concord with that of the moral constructivism of Kant and, almost without doubt, the political constructivism of Rawls. Smith’s social constructivism allows his economic constructivism to take place. The IH as a function of Divine teleology allows for social processes to be generated thereby creating situations for economic practices to be in concordance with them. Economic ideas come forward for the good of the individual and society, and are balanced, fair and just for all.

A more detailed look at this can be found in Justice as Fairness Revisited and The Awakened Eco-nomy. In the end this post too is just a blog, like any other, and it is hoped that those with sharper minds and a more intense passion will develop things from here to see where it can go.

End of the Reign of the Magicists

So where does this leave those Nobel prize winning ideas for economics and all other dandy econometric models and stuff taught at universities to churn out more intellectually misguided people (having partially suffered from this, I know whereof I speak)?

Hey, what about those Laws or Demand and Supply (DS), Say’s Law, Taylor Rules, NAIRUs (non-accelerating interest rate of unemployment) and those of the sublime perfect market which talk about Pareto optimatlity curves, (false) equilibriums where everyone has to use cost-benefit analysis to fight for scare resources to maximize utility. Everything else outside of this is that inconvenient thing called an ‘externality’.

Milton Friedman delusionally described the difference between ‘good’ and ‘bad’ externalities where being charitable would be a ‘good’ thing but aiming for so-called corporate social responsibility (another contradiction in terms) is a ‘bad’ thing which bucks (no pun intended) econometric models because it could undermine the sole reason for corporations existing which is, of course, profit making while the world goes to hell.

What this means is that if you ask a corporation or a capitalist to factor in human decency and fairness into a ‘law’ of neo-classical economics or its profit taking model, you are talking ‘externality’, man.

But my friends, what is this so-called Law of DS or equilibrium? Let’s go against what our schools and many tertiary institutions teach you not to do, let’s actually think a little and try a bit of common sense (no certificates awarded for this). Apparently there are these kind of push and pull factors which seem to be observed when wants for commodities are met with a flow producing them that intersect at the right price. What are these forces that create such wants and flows and intersections and push and pull like the tide of the sea?

What is optimum growth and equilibrium? Are these points of description of the most suitable or desired or needed form of growth in given circumstances as decided by curves, governments, societies or people’s feedback? Or are they what economists claim they should be? What is this idea of balance, and rising and falling of forces that produce new forms of things and energies? You have nothing but economic and social theories and models to explain this.

If you ask what gravity is, well it’s this force that’s composed of gravitons. How did this come to be? Well these are natural forces, just like DS or equilibrium or optimum growth that are codified by professors in academic ‘disciplines’ and don’t need anything else to explain them. If you ask what is behind gravity or equilibrium you are told that is not necessary to ask because the current theories are borne out by empirical observations and that sufficiently explain things.

So is there a giant squid at the centre of the earth whose suction causes gravity? Sure, possibly, but why do you need that when you have a law of gravity? The latter is a sufficient explanation so the squid can be left to Captain Nemo and his like. Is economic ‘equilibrium’ a sign of the IH, yes, in so far as it describes ‘economic forces’ and any notion of some other elements behind the IH is mysticism and irrelevant (‘economic forces’ being sufficient to let us sleep soundly each night). It is not scientific or modern nor a reflection of ‘enlightened’ reasoning to go beyond a ‘satisfying’ set of theoretical explanations.

But all these explanations are circular at worst or question begging at best for each time you ask what causes these phenomena like equilibrium, they are ‘economic’ forces and what are these forces….these are theoretical constructs to explain this that and the other…what is the basis of these constructs…observations backed by hypotheses or vice versa as tested against the world….that show that these forces are indeed at work…ah ha…back to square one with stunning clarity.

When pressed as to why they do not go beyond such silliness in their theoretical reasoning -- it’s to avoid mysticism. So what we are offered in effect is this: there are mysterious forces at work, just at Klein describes the IH and other things in Smith in a manner that would make Agatha Christie proud, but we have some ‘explanations’ that should do the trick. Aren’t you impressed by our intellectual sleight-of-hand; see how clever we are; we are the smartest of the species coming up with all kinds of reasons to explain and make more things convoluted and complicated so that we can progress onwards in a civilized manner devoid of mysticism.

The illusional, delusional, tricks-of-academia and intellectual-do-it-with-mirrors is just that – magic. In place of the genuinely mysterious, the mystical, and the miraculous we have Magicism. Magicists, like many economists and scientists, believe that things just happen to be. These are natural forces which coincidentally are what they, well, are! There is no reason why the whole universe, solar system with its bodies moving around without crashing into one another, and sudden life that evolves with spectacular biodiversity cannot be explained away by theories and constructs as one massive coincidence. In other words, magic. It all happens to be there, presto! Just like that.

This Magicism has no bearing on what we use to describe an extraordinarily beautiful sunset or a special moment with a loved one: that kind of magic is an analogue of the miraculous and has an alignment with a moral centre and Divine Order.

Magicists also denigrate religious or spiritual experiences as purely personal ones peculiar to an individual or if shared then part of mass delusion. There are countless theories to explain this…why all this supposedly occurs and why life, the world and humanity is the way it is…meaning, it is what it is: abracadabra. You just explain away anything that’s greater than the human ego and its obsession with itself and excessive sensual indulgence by theories and magic.

So the IH and market forces happen as a result of magic. If you want a spiritual explanation to things then you have to rely on mysticism. Smith as a FM proponent and glorifier of Capitalism cannot simply be subscribing to that, now, can he? Notice the circularity as to how Smith has been appropriated? If you want only reason and scientism to show you the way forward solely through ‘hard’ facts and math etc, then you have Magicism.

Not that you cannot have theories balanced by the spiritual and a moral centre to the world and the universe (e.g., Newton, perhaps Einstein, Kant, Smith and Rawls – though the latter would prefer not to bring in the spiritual overtly). But to do that is to slide into mysticism. Why do that when you can be inaugurated as high priest in Magicism and be a Magicisit cum laude at an accredited Institution of Learning, or be called an Expert and win International Prizes?

Then you have philosophers who are Magicists. They will talk about a metaphysical basis to things and when pressed beyond that will tell you either what they say is sufficient, or that they cannot or don’t see why they have to say what exactly it is behind the Metaphysics. This is a metaphysical smoke screen to hide their ill concealed Magicism.

Those that have a metaphysics and believe there is Absolute Mind behind it like Hegel or the World as Will and Idea as Schopenhauer, are partial Magicists. There is an Absolute but it is devoid of love, compassion and the miraculous. Such ideas sadly get misappropriated by ignorant and rascally elements who then turn them into an excuse for totalitarian ideas or mind bogglingly self defeating pessimism. So partial Magicism has its dangers too.

Or, there will be thinkers, writers or philosophers, eminently talented too, who opine that there is some ‘centre of life’ which, well, is a centre of like, all that is, etc…doesn’t necessarily mean Divinity, but there’s something out there…Magicism bordering on the occult or vice versa. At best one can ascribe partial Magicism to them.

In fact, if you take the trouble to look closely at the ideas of full blown Magicists, you will find that they are inadvertently (or otherwise) occultists. They will tell you that the truth (if it can be known and to what extent it can be know, etc, etc) comes via their full blown or partial Magicism, the ‘clarity’ of academic jargon, econometric models, theories that are constantly outdated/replaced, and formulas of politically correct commonality by the self serving media or politicized hype to show you why you ought to remain disempowered and beholden to their incantations and…Occultism.

Where does life come from, what happens at death, why do people believe in Divine Order/God/Supreme Being…well, here are the theories, degrees, and career paths to sort that out, and a whole lot of magic and occultism to boot. Why? Because, the spiritual like all else that matters in life like justice, fairness, and compassion are externalities.

When you bring in externalities into academia, science, the workplace or the corporation you ruffle feathers because it gets in the way of ego, material grasping, profits and whatnot. Magicists and occultists do indulge in a quick mention that there ought to be a balance between being reasonable and ‘getting the job done’ (because apparently being unreasonable is the way to really professionally effectively get things done). But here again, where does the notion of balance come from…magic.

We have reached that point when all that defines existence and human decency and social and planetary responsibility are externalities that are the adjunct of mysticism, while all else like profit margins, banksters (gangster bankers), big bonus freaks and greed and perpetual war are at least theoretically explained as part of the reality of life…a.k.a magic: because it just happens, that’s the way it is. Things being the way they are without much to explain for them (beyond egocentric opinions and selfishness or endless theories) are just an unsubtle code for: yes, you guessed it, Magicism.

But we are now at long last on the path to seeing the end of the reign of the Magicists and Occultists. People are finally, after being led to near global bankruptcy using useless paper fiat currency backed by printing presses and endless war, starting to wake up and say enough is enough. That there is a moral centre to life, to the world and to the universe and that we are not going to take this violence and ignorance and nonsense anymore.

The Fair Market

There are indeed natural forces at work in the Universe that govern all life on earth as well. This must be the truism of the millennium. All life is part of a natural force. As Dylan Thomas wrote “the force that through the green fuse drives the flower Drives my green age”, and “Time held me green and dying Though I sang in my chains like the sea”.

The only externalities are the Magicists promoting their Magicism. But like all else in nature that has had its time, the Magicist structures and mechanisms are starting to decay, fall apart, and will eventually be reabsorbed into the world as part of the cycle of things guided by forces more powerful than egomania, celebrity cultism, media manipulation et al.

Contrary to the dying exhortations of FM fantasists and hard core Capitalists, freedom doesn’t guarantee fairness. The well worn adage that your freedom to swing your arm ends where the other person’s nose begins still rings true. There is simply no unbridled freedom to do as you please because we live in society and have a responsibility; and if we want things to go well for ourselves, to also see that things go well for others. There are limits to freedom. Try jumping off a skyscraper to show that you can do anything you want with impunity and you will discover the parameters imposed by what we call gravity.

As part of all natural forces in the universe and our planet, everything is subject to parameters. That’s why there’s life in the first place. Given the conjunction of conditions at the right time and place the synchronous and miraculous happens. There are indeed natural laws that affect us all as there are moral laws that affect us all which help us to maintain sanity and balance in our lives thereby allowing us to create the society we dream of living in, if we so choose.

What is this moral centre? Just look into the human heart: there is a sense of right and good there. The mystery is how it came to be there and why virtually everyone resonates with it. But there is no befuddled mystery, as Smith would say, if we recognize the Divine Architect behind things. What we need to do is concentrate on doing what is right for ourselves and thereby others which is fulfilling that part of the plan on Earth.

But the human ego gets in the way. It gets in the way to cut off that Light and enhance the Darkness, and from that shadow world comes fear, doubt, scarcity, greed, envy, anger, hatred and resentment. From that sense of Darkness comes fear that unless you can be free to do whatever you want irrespective of the consequences you -- your ego -- will be harmed. Speak to anyone who claims to believe you can be free to do anything you want and to hell with everything else and/or who are hardcore Capitalists and they will show you the obverse side of Fear.

Bring out cooperation, collaboration, justice, fairness, compassion and decency and those who live in Fear will tell you why something might happen that leaves them at the mercy of others whom they despise and want to lord over because they judge that everyone else is like them. Naturally, in that case, the only option is to fight tooth and nail to support ego based desires, wants, fantasies and Fear.

Fairness, however, does allow for freedom. As Rawls points out, in order to be fair you would have to have these basic principles of liberty of allowing as much freedom to others as you allow yourself, fair and equal opportunities for all, and look after the interests of the least advantaged and certainly those of the disadvantaged. A mature democratic society would also be based on overlapping consensus and through ground up working of self interest creating the principles by which your society should be governed. There is a moral centre for Rawls because people intuitively have a sense of what is good and fair.

Smith goes beyond Rawls in believing there is a Divine force behind the moral centre. And in doing so, and has been discussed, believes not in a so-called FM or Capitalist way of doing things but in a Fair Market. All the ideas of Smith and those that resonate with him (and in his own way this would include Marx) are proponents of a Fair Market. A system where when most things are carried out in a fair and reasonable manner and aligned to a moral centre, will ensure balance and harmony not just for the individual but everyone.

Market corrections are the realigning of things as if by an IH, to be in resonance with a moral centre (which we intuitively are aware of when we are open to Divinity and the fact that God does exist). This is about balance and harmony.

What are termed ‘market corrections’ today is within the heartless framework that treats compassion as an externality thereby promoting the notion of punishment to set things right. The market or FM of today is a blind godless unforgiving system of punishment for what ‘delivers’ and what doesn’t because it is based on Fear. In new ways of doing business and having a natural flow of a community based nature of running society (as discussed in more detail in The Awakened Eco-nomy) we move away from Fear and all its concomitant horrors.

There is freedom for all human beings as we have been given the gift of free will and choice. But this is choice with an understanding of the reality that there are always parameters to everything: free will means the ability to choose between aligning oneself to the moral centre of Divinity or choosing not to align to it. The consequences are obvious and all around us as we can see the choices made which have resulted in a collective consciousness in the world which largely chose Magicism and the Fear, destruction and suffering it brings.

Fortunately, more of us are slowly coming to realize that we can choose the Fair Market, which allows for all of us being able to fulfill our positive potential to the highest.

In his own way Smith is in good ancient company, he is in effect promulgating a Tao of Economics: Yin-Yang balance that is the expression of the Creator in a Universe and world whose physicality we seem to experience most of the time without always being conscious of that beyond the immediate perception of our limited senses.

But when you open your heart, your mind will follow it to the moral centre within and align everything to the Source where all life comes from. When Fear drops away and the veil is lifted, a re-visioning of the world takes place and you can actually see that the Invisible Hand has been visible all along.

The Awakened Eco-nomy

2009-03-25T18:22:00.123+08:00

The Awakened Eco-nomy

Or, The End of Communistic Corporationist-Capitalism (CCC)

U2’s latest album No Line on the Horizon has a catchphrase that appears through most of the songs – “Let me in the Sound”. But the phrase that may appear in this post regularly is: “When will people finally wake up?” Not as graceful as U2s one liner, but no doubt either Bono or a George Harrison could turn up a good song to go with it.

But to the task at hand. A little effort and thinking will show that what is termed as Capitalism, “free enterprise”, “free market”, and “competition” under the guise of Democracy is only an insidious subtle subterfuge that has bamboozled billions of people for a longer period of time than the so-called Communists of yesteryear.

For detailed background information behind the ideas in this post please check out:

Interdimensional Economics (Part 1)

Interdimensional Economics (Part 2)

As is the case with all things that are part of the natural order of this organic universe, world and life forms it contains anything that is imposed, false, mechanistic and full of skull-and-bones-duggery finally gets shown up for what it is. So the current economic unraveling and Great Financial Reckoning we are in the midst of is a sign of better things to come as we rid the planet of not only toxic assets by banks, but the toxicity of the greed and duplicity of Capitalism.

The irony is that now that Communism is to all intents and purposes dead, we can see just how much Corporationist-Capitalism is just the reverse side of the coin of Totalitarianism and Communism. Far fetched, you think?

Take a close look at the key characteristics of the erstwhile Soviet Union’s Communism and our Communistic Corporationist-Capitalism (CCC) today. The USSR was known (in the Cyrillic alphabet) as the CCCP, so our CCCs are just a 'P' short since they do not declare themselves a political party. The CCCs prefer to manipulate political parties and systems armed with the ideology of Capitalism

In the case of the USSR, its Constitution (the 1977 version) reads like the most democratic document of all time. It guarantees all kinds of rights from freedom of speech, to assembly and to the most democratic of activities. It claims to take its strengths from the proletariat citizens that make up the State. Yet we know how diametrically opposed the USSR actually was to any genuine democratic concerns.

The USSR had a system of Communist Party officials who were elected (there were hardly any other candidates offering a real choice) through the Party Congress, to the Supreme Soviet (highest legislative body) through to the Central Committee and its Secretariat from which the Politburo emerged. The Politburo was the inner sanctum of power and it had a Chairman/General Secretary heading it. Through a system of internal elections and bloodcurdling power struggles it decided who ran what and who had their fingers on the nuclear buttons of the military arsenal. The USSR called this a democratic system.

Look at our very own CCC. They have a group of shareholders (Central Committee) who apparently choose a Board of Directors (Politburo) who also have a Chairman. Sometimes it is an executive Chairman and you also have the CEO (either of whom can pass for the General Secretary) who is supposed to be the chief executive of the Corporate Apparatus. The Board can also co-opt other Apparatchiks from elsewhere if they can contribute to the money making ventures of the Board.

There is nothing democratic about this. Democracy is an operative term that denotes people power. The USSR had no people power but Apparatchik power that controlled the people in the most undemocratic manner possible all in the name of being ‘Democratic’. This is also known as a reductio ad absurdum.

The Communists claim to be a 'dictatorship of the proletariat', exactly the kind that would have made Marx wish he had been cremated as Engels was (so that there would not be anything left to roll around).

[Point of Clarification: The idea of a dictatorship of the proletariat was first mentioned by Marx and Engels. But their idea of it was as a transition phase from capitalism masquerading as democracy into Communism where there was a 'withering away of the state' and proper democratic freedoms settled for all without any state coercion.

Lenin's idea of such a 'dictatorship' and end of state coercion followed similar lines and he was short on details as to what a Communist system would ultimately be. Lenin argued eloquently for his vision of the transitional 'dictatorship of the proletariat' in his seminal What is to Be Done and State and Revolution.

As Lars T. Lih brilliantly points out in Lenin Rediscovered: What is to Be Done in Context, Lenin was in all probability genuine in having a system free from all coercion and one that was just and fair for all, which involved a dictatorship of the proletariat being set up as an interim to his ideal political system (which he thought coincided with Marx's vision).

But the problem is that Marx did not live long enough to outline his ideal Communist system, and Lenin allowed things to slip out of his control. So while Lenin deserves credit (with Trotsky) for offering dynamic and visionary leadership, the sad fact remains that they also have to answer for what went wrong in the USSR and for having blood stained hands in allowing for the execution of political opponents, 'reactionaries' and the convenient massacre of the Tsar and his family. They were thereby responsible for the monstrosity that followed in the wake of Stalin.

But as I have been trying to show in the earlier posts called Interdimensional Economics and as I hope to explore in subsequent posts: the ideas of those like Marx, Engels, and Lenin can be realised in their highest form of good if taken to a different paradigm. This would involve taking a metaphysical basis to things as well as looking at what a real democracy looks like without resorting to dictatorships of any kind. But these would be ideas that Marx and Lenin would have objected to because for the former it involved 'metaphysics', and for the latter it involved 'democracy' which was a distasteful ideology for Lenin (who in turn ironically resorted to ideology to put forward his views).

The point being made here is that the Communist verision of the 'dictatorship of the proleteriat' as was known to the world was one of the worst forms of totalitarianism in human history]

The lovable CCC creates a dictatorship of selfishness, greed and egomania (We will come to the profit motive soon). Now here comes the revealed sleight of hand of the CCC after the demise of the Soviet bloc. Once the latter had collapsed economically and politically, and the West no longer had the opportunity to contrast their product of so-called western democracy against the so-called non-MBA trained Communist bloc, the CCCs could sell and effectively market its own agenda of world domination of markets and human beings under the guise of “free enterprise”, “freedom” and “democracy”.

With the major Communist competitor out of the way, the western democracies formed an Oligopoly. It was now a matter of seeing who won the game between themselves in creating a Monopoly.

(China poses special problems here because it is anything but a Communist state these days).

So all the so-called free enterprise CCCs came out of the woodwork and before long embarked on merciless and blatant mergers and acquisitions that made anti-trust laws seem heaven sent. While heralding wealth and prosperity for all (meaning the CCC Nomenklatura), the drive for aggression and domination created a whole system that is skewered against any form of financial or economic stability. The CCC lust for power and money fosters not market equilibrium but disequilibrium for that is the only way to be a monopoly.

The USSR had their power elites who cornered the ‘market’ of privilege and showed us the truth of Orwell’s prescient “Four legs good, two legs better” dictum. These happy folk were known as the Nomenklatura.

The CCCs have their own elites with all their privileges and private jets and indecent bonuses at the expense of all honest working men and women who are usually honest taxpayers too. The CCC nomenklatura seek to unduly influence decision makers, legislators, the media (which they largely own) to keep their ruling class in sovereignty over everyone else preferably as unjustly and unfairly as possible.

Some years ago when Microsoft was starting to really earn its reputation as a bully in the market, Bill Gates actually admitted that he was interested in biographies and, at that time, was deeply immersed in one on Stalin. He was not reading about Stalin to learn about better business practices, but probably on monopolizing control of things. So Comrade Stalin would have been a good fellow to study.

Just as the USSR sought to spread its ideology and control over the globe, that is exactly what CCCs have done in infiltrating and destabilizing the world and national economies all in pursuit of its own blinkered ideology: the profit motive. And they quote misguided neo-classical economists and their practitioners today to come up with the right kind of mumbo-jumbo to support corporate takeovers wherever and whenever possible with ruthless removal of all competition. Apparently that is what competition means – liquidating the other guy whenever feasible (pun fully intended).

Think about it. In a so-called democracy today, how is it that the entire economy, politics and lives of people are subject to the dictates of CCCs, what they do, whom they hire and who are part of their Politburo and Central Committee of shareholders? Not to mention allowing the world’s economic fate to be affected by what their nomenklatura desires.

So much of what we see that has happened in the entire economic cycle of inevitable booms, busts, currency devaluations, mass unemployment, poverty, human abuse, wars and conflicts have been caused by unelected apparatchiks who’s goal is the profit motive. There is nothing democratic, free or fair in business apparatchiks claiming to serve “democracy” when all they do is serve their greed and interests of their shareholder central committee members.

CCC elements buy and corrupt politicians to ensure that legislation is produced to serve the interests of their structure and apparatus. We are talking their politicians at home and abroad.
All this to serve the ideological God of the Profit Motive (the new name for Mammon of old, you remember him, surely).

As most of humanity is plugged into a system where their material needs are dependent on selling their labour power (since that is virtually all anyone has to sell) to make a living, nobody really questions this worship of Mammon-Profit Motive. In fact, this is usually not just out of ignorance but out of fear from the perception of what the CCC apparatus might do to them in terms of leaving them out in the cold to starve.

But these very activities of the CCC are now what is causing all the economic instability in the world, not to mention coming to terms to the incalculable damage done to the environment and our beloved planet.

When will people finally wake up…?

All attempts by CCCs to pay lip service to protecting human dignity, or the environment, is done so as to continue serving Mammon-Profit Motive. Let’s not be fooled here. Every tax incentive that is sought, every CCC loophole that is gained via manipulation of the media and politicians and connivance of banks is done at the expense of human beings and national interests. What is so ‘free and fair’ or democratic about a system that allows tax loopholes and privileges to be wrangled out by CCCs at the expense of the average tax payer (that is, the mass majority of respectable citizens). Somebody has to pay for all nomenklatura privileges of the CCC, and for some reason it seems it has to be you and me.

So tax payers continue to pay taxes, take on heavy loans and work themselves to near death while the CCCs and their top honchos continue to evade taxes so as to gain even greater bonuses for themselves. In other words, you get to support the CCC worship of Mammon-Profit Motive and also get to call your society a ‘democracy’: now that sounds like a two-in-one offer that’s hard to resist.

Bear in mind that the entire advertising, marketing, and media industry (with few exceptions) are honed to titillate the senses, negativity, fear, anxiety or the ego in service of Mammon-Profit Motive. Virtually all such industries in the media are under CCC control in one form or another, so they DO NOT serve the interests of the people but that of the CCC Politburo and Central Committee and careerists within the industry who hope to rise as Apparatchik.

Then we have the high priests of Mammon-Profit Motive, the Banking industry. The major banks are in absolute cahoots with Big Business and play a part in creating the distinctive self centered nature of the CCC beast. Essentially, all profits made from paying working people lower than they deserve in the productive process of commodities, is stashed away/invested in banks by CCC elements. The stash is then loaned out to all of us which we then have to repay plus interest.

So we are loaned the money we helped make and for which we now pay back with interest. Is there any wonder why the whole world is in debt? This is the gift of the CCC structure – a debt based economy. And when the loans are called in due to ‘toxicity’ of banking assets or otherwise, we all have to pay the price. Those who are in lower income groups or at subsistence level living bear the brunt of the economic crashes created by the CCC apparatus.

Take a break and watch these clips:

Capitalism 101

Capitalism Primer

Full Version

Capitalism Hits the Fan

Next comes a term that is well used within the USSR system, that of the interlocking directorate. Heed these words by Charles Timberlake:

"THE PARTY CONTROLLED THE GOVERNMENT. In fact, it functioned as THE LEGISLATIVE BRANCH OF GOVERNMENT. The “government” (described by the Constitution of 1936) functioned not as a legislative body the Constitution alleged, but merely as the EXECUTIVE AGENCY that implemented decisions made by some 12 to 13 people who composed the Political Bureau (Politburo) of the party. But, the people who held the most important government positions were also members of the party organ that made the decision. Having made a decision, party and government officials passed commands downward through parallel party and government hierarchies. At every administrative level, the party committee (which always included the head of government for the administrative region) met to discuss the command, and then passed the commands downward, through the same parallel party and government structures, to the party and government officials at the next administrative level below them. Thus, the Party Politburo adopted legislation. It then implemented those decisions through two parallel, hierarchical bureaucracies that had---at every administrative level—interlocking directorates. We may accurately refer to this relationship as 'the Bolshevik Party and its government.' ” (italics and highlights mine)

What this means is that CPSU members (Communist Party of the Soviet Union) who were in the Politburo, Central Committee and other organs of the party or state, had a wonderfully incestuous relationship via sitting in one another’s committees. So you would have members of the military who would be members of the CPSU, Central Committee, and Politburo, etc. This was a way to exert ideological thinking, control, as well as self-aggrandizement throughout the system. To say that this led to cronyism is to put it lightly.

Guess what? The CCC boasts of having an interlocking directorate system in which board members sit on other boards, which include politicians and people of influence. This is apparently in the interests of ‘democracy’, the ‘free market’ and ‘free enterprise’. While the rationale for such a notion was sold as being a way of maximizing synergy, it is really a way of cronyism, self aggrandizement and ideological control more than anything else. The CCC barons of today more than the dead Stalinists of yesterday, are the exemplars of Lenin’s dictum: “Who? Whom?”

This was an elegant expression for ‘who exercises power over whom’ in that the old school Communists, and the CCC exponents throughout history, are proponents of the master-slave set-up. Guess who fills in which roles? (When will people finally wake up…?)

The USSR had a system of summary executions (liquidation) of dissenters especially in its Stalinist heydays. The CCCs in the spirit of ‘free enterprise’ and ‘democracy’ summarily fire staff with only a day, or less, notice.

Many of us are aware, even as we read these lines, of layoffs by private firms that see to it that those relieved of work are sent down and out with their shoe box of personal items summarily in hand, and made to walk right through the front door without a chance to even say good bye to a single colleague (except the one who was laid off with you). The reason is that there is the fear that you may sabotage office equipment or cause dissatisfaction among staff etc if you are treated humanely and given a proper notice that you have been terminated. Worse, you may ‘steal’ stuff that can be used by a competitor!

And we do not even need to look into the arena of CCC politicking and backstabbing which may make some communist parties look anemic.

Mammon-Profit Motive serves self interest and involves the indubitable exploitation and theft of others’ effort and lifeblood to sustain untrammeled greed at the expense of all life forms and our planet itself. It promotes cynicism, doubt, and a nihilistic worldview.

If the state of humanity and the world as seen through events of the 20th century is insufficient testament to the effects of nihilism, just read any of the major novels by Dostoevsky to get an idea of what it is all about.

Incidentally, the nihilistic worldview of extremists like Nechayev had gone quite some way to evolving the kind of ruthlessness and brutality that stalked behind the likes of Lenin, Stalin and Trotsky.

So much for the Mammon-Profit Motive: if there ever was a system based on insecurity, fear, vindictiveness and sheer lack of integrity it is what we call capitalistic ‘private enterprise’ today.

Thought Experiment

Try this exercise. Imagine you have suddenly discovered, and see in the clear light of day, that you live in a world in which a group of people belonging to a set of ideological beliefs need to protect their interests above all else (try, perhaps it is difficult, but try).

It is a world in which technology has been used to control and influence your mind and that of others on the planet. Let’s say They can instill in you the desire for unbridled self indulgence, fear, anxiety, hatred, divisiveness, a sense of separateness from others, despair and anger so that you become a kind of automaton, a mechanized man, woman or youth subject to their manipulation.

This entire structure of control is created for the sole purpose of keeping the mass majority of people subservient to the dictates of a nomenklatura. And you either join the Controllers or you will be liquidated by them one way or another (or simply be worn out by ‘life’).

What would your reaction be? How long will you tolerate this subjugation of your loved ones, yourself, your friends or anyone for whom you had a shade of caring for?

Yet this is exactly the system of the CCC we have been connived into buying with the full and, in many cases, willing participation of the media. Communism ‘lost’ because something more subtle and soul destroying ‘won’. But like all mechanistic set-ups, it has run its course in an organic universe and world.

Nothing can beat the laws of Nature. The mechanized CCC clones are only finally realizing that the system they created is collapsing around their ears. There are NO laws in economics: it is one of the greatest frauds perpetuated on humanity.

There are only laws of Nature. There is not one theory of Mammon-Profit Motive that can beat the law of gravity. And the CCC tower of Babel is coming down, hard.

At the moment of this writing, the US Federal Reserve Chairman Ben Bernanke has said that unless insurance mega corporation AIG is bailed out via taxpayers $ a “global financial meltdown” may occur. Stop the press! Did he say “global financial meltdown”?

Now kind reader, please ask yourself how on earth did we get to a stage where some crummy firm holds the fate of the global economy? Is this kind of a situation a reflection of democracy and can it ever have been geared to protect the interests of the people? The CCC structure is so top heavy with the centre of gravity so stacked in an ungodly manner in favour of its nomenklatura that the toppling of this ungainly edifice causes the world economy to tumble as well.

If there are right thinking people left on the planet, they should be asking why does this situation exist at all.

A Social Kind of Economy

So where does that leave us? Actually, with good news all around if we choose to act on it. Where we need to go is towards a social kind of economy which is a community based one. This is not socialism or any other ‘-ism’. Do some research and you will find more than you imagined that is available out there on this. One such example of building sustainable communities is the Transition Town.

The key here is this – we move away from Mammon-Profit Motive to sustainability. So the basic rationalization of any commercial set up is one that is modeled like a social business in which its bottom line is sustainability, NOT profitability. It must be stated that the term "profit" when used in the context of a social business means "sustainability" not Mammon-Profit Motive.

But the difference between a social business and commercial venture of the Social Economy is that while a social business aims to cover costs and sustains itself and staff and can be perhaps seen as a welfare enterprise (e.g., eye clinics, providing basic food stuff, health and social insurance etc), a commercial enterprise in the Social Economy can aim for higher revenue as part of sustainability.

What this means is that it is not aiming for profit, but can aim for surplus sustainability. So such a firm would take whatever earnings it receives over and above its basic sustainability, that is, the bottom line of what would have qualified as a social business; and place that into a sustainability fund. This fund would be shared out equally or at a pre-arranged ratio (agreed to prior to setting up of the enterprise) among all those who work in the firm -- this means all workers/staff and managerial officers. The only owners in this firm are the workers, staff, executives and supervisors.

There is no need for bonuses or bizarrely high pay for anyone. Managers will earn as much as workers or perhaps more depending on the agreement by those who set up the firm. In the case of large firms the government, local governments and those who are part of the firm will be the shareholders. The entrepreneurial folk and banks are invited to join in and/or hired depending on how people want the set up to work.

There is voting at different levels of the community to ensure maximized democracy and a stake in the system and the commodities produced. This can be worked out according to each society to fit its needs and context so no gridlock of approval/voting need take place. What with the Internet, a lot of the choices made by people can be expressed via online procedures as well.

Please bear in mind that online voting procedures would refer to situations in developed democracies. In the case of poorer states, social businesses will take care of the needs of the underprivileged and those lacking in education etc.

All commodities and means of production will be aligned to what the country and its people determine as GPF solutions, that is, Green and People Friendly Solutions. The nature of the workweek, workday, relationship between colleagues and the relationship to what is produced for people within a country or for export, will be aligned towards respect for human dignity and the environment.

This is well within our reach if we put our hearts and minds into it.

Some of the changes that would be required would be:

Overhaul of national and international laws pertaining to the banking industry

Overhaul of national and international laws pertaining to firms and enterprises. No firms will be given the protection, loopholes or incentives that are currently in place which are manifestly against the interests of human dignity, lack all compassion, and desecrate the environment

A detailed study of what aspects of Islamic financial principles can be used effectively here (e.g., such principles can be applied in creating the sustainability fund mentioned, its contractual basis, as well as its operative procedures). The reason for looking into such principles is because the whole commercial enterprise in Islam is meant to have a system balanced with Divine Law, justice, fairness and compassion. It is also an effective way to make the Islamic world part of a revamped global economic enterprise. Islamic economics is taught at a number of universities worldwide and material on it is readily available everywhere

Removal of all interlocking directorates. There may be a situation that warrants, if at all, a person sitting in two firms holding an official post in each but it cannot go beyond that. This is to minimize cronyism, group think and corruption (to say the least)

Removal of stock exchanges and any semblance of gambling in the economic growth of nations or their currencies

When in doubt bring in members of the community etc to discuss and settle an issue through a vote. People who sit in on these groups are voted in by their communities as part of regular local elections. This allows for full accountability and transparency. It is also surprisingly democratic. This is what is meant by People Power: not that which is disruptive, but that which is constructive and aligned to the positive energy of GPF solutions

Communities are empowered to ban all forms of advertising, marketing and media. They can allow them in or create their own based on what suits their values. Creation of citizen journalists who report fairly, well researched and boundary pushing news with the welfare of the community and society at heart. No more answering to egos and CCC type dictates

The role of government is one of synergy and one that not only provides national leadership, but also complements and supplements the feasible and viable efforts of citizens in whatever projects and enterprises the citizens ask the government to come on board.

Also needed is a political system, at least in developed democracies based on the principles of Justice as Fairness as proposed by Rawls. John Rawls’s ideas of political constructivism allow for people to use their interaction and lessons learnt from an overlapping consensus created by state or society from which is derived the political principles that will govern their society or community.

Similarly, we can now have something called economic constructivism which allows for a similar process in which a society and communities allow for social economy type enterprises to flourish to sustain and support the citizens of a country as well as take part in synergistic regional and international trade devoid of practices meant to undermine the ‘competition’. The new type of competition promoted here is a just, fair, and compassionate one that allows each state, society, or community to build on strengths and advantages which allow the import and export of commodities which create a win-win situation for all concerned.

So rather that comparative or competitive advantage, we have sustainable advantage which allows nations to have a system of trade that allows for social economy firms and businesses to maximize their potential while allowing fair and beneficial exchange of commodities. Returning to the societal and community level, some aspects of the process of economic constructivism would lead to maximized creative endeavours which should lead to the creation of necessary and meaningful work that sustains an economy and society.

This would entail initiatives involving

local/complementary currencies (e.g., Time Banks)

barter exchanges

the really really free market type activities

volunteer based set ups and organizations that involve schools, youth and social economy businesses/firms, governmental organizations, and NGOs

There is no reason why the four aspects above cannot be applied to regional and international trade in an extended sense. All it takes is political will. But to do that it takes people electing the right type of leaders and holding them accountable in public office. Which means there is not much room for a slacker citizenry; People Power involves a fully participatory democracy of people who are mature, tolerant, and willing to accept responsibility for their decisions.

And from that point on, any blame for things that don’t work must be leveled at the source for that which has allowed things to happen in each society: the image in the mirror when you look into it.

Eco-nomics

In order for any system to survive in a healthy, balanced and sustainable manner, it would do best to mimic or be one with the organic nature of the universe, world and life on it. This means ecological balance.

The social economy proposed here is one of creating an economic ecosystem or Eco-nomy that fits into the way the world actually works according to the law of nature, and not some bizarre mechanistic imposition serving the fallen angels of Mammon-Profit Motive.

A system of empowered people and a decentralized economic web of being will allow for communities to fit into the national organism of state, and allow the latter to grow and live in harmony and balance with its communities and citizens. This is the true nature of a synergistic, collaborative, synchronistic and symbiotic relationship which may be possible in a society. Recycle all those irrelevant management textbooks as they serve Mammon-Profit Motive and we do not need them anymore.

With an eco-nomic system, we no longer have the unnatural high centre of gravity of the CCC hierarchy which leads to silly statements that the world economy is in peril because some lousy firms show just how lousy they really are. An eco-nomic system has a well spread out centre of gravity that provides for stability all round.

Just watch the give and take of nature and how balance can be maintained for the benefit of all. But you do need gardeners, which is why we need leaders who are just that -- not those who compel others to do what is against their own interest, but gardeners who nurture, cultivate, strengthen and beautify the garden politic.

The leaders we need today for tomorrow and beyond will be the Good Gardeners who tend to the Garden of State and maintain its balance, harmony and well being. Community based leadership and economic growth is a reflection of the kind of eco-nomic system we need for a just, fair and compassionate way of doing things. That’s why the notion of political and economic constructivism fits in perfectly.

We should look to creating an organic system of self adjusting principles and ways of doing things that allows for social, economic and political osmosis of ideas and goodwill between all people in a society and between nations.

We need to be like water: flexible, all encompassing, have miscibility (able to mix freely with all things), and have that special ability miscalled an ‘anomaly’. Water’s so-called ‘anomaly’ is this: that it reaches its maximum density as it approaches 4 degrees Celsius. This characteristic allows for the surface of large bodies of waters like lakes etc to freeze, while keeping that below in liquid form circulating within its internal convection cycle of well within 4 degrees Celsius: this is why fish can live below frozen lakes.

How is this possible, indeed. This is natural and cosmic law, not mumbo-jumbo economic ones. These are natural ecological parameters that allow for the sustenance of life. So an eco-nomy is one that corresponds to cosmic law: as above, so below.

Similarly, we need to learn from the flexibility, suppleness and cleanliness of water in allowing for the type of parameters within our societies which foster balance, freedom, fairness and compassion. We need to move away from the narrow, imbalanced and destructive concerns of the ego and look to the whole, thereby looking after the interests of all within it. This calls for a self adjusting, self regulating natural system of government and an open hearted way of doing things.

But empowerment comes at a price. It comes with waking up, getting real and growing up.

Then we will have started to create an Awakened Eco-nomy.

Live Long and Prosper!

Darkness Visible

2009-02-27T09:52:00.034+08:00

When Will People Finally Wake Up...?

Barack Obama is a good man, but his $250 billion bailout for banks is misguided. It is time for people to stop supporting such bailouts at their own expense. This comes in the wake of yet another announcement of yet another failed financial venture, the Royal Bank of Scotland (RBS). The RBS is reported to have loss an equivalent of $34 billion due to the unravelling debacle of the world financial crisis, and a badly timed takeover bid of Holland's ABN Amro.

But it gets better. Britain's government has, through an inspired move, decided to insure "toxic" assets worth about US$ 464 billion under its Asset Protection Scheme in order to cover 90 per cent of losses resulting from such deals.

Yet, the plot thickens, as there is no guarantee that banking moguls on both sides of the Atlantic or elsewhere will forego bonuses, or that the media will have the integrity to report and go after such robber barons (if they remember what investigative journalism means).

The famous banks of Switzerland have also agreed to go back to the age old formula of not disclosing clients' financial accounts lest the criminality and shenanigans that have been going on for decades will be made transparent. Apparently more secrecy in times like these is the best way to help the world.

But the Swiss banks have good reason to be secretive. Do some research to find out how the German government had created a 'secret' bank account for adorable Vladmir Ulyanov (a.k.a. Lenin) to help him finance the Bolshevik 'Revolution'. This was instrumental for the Financial Moguls who have tried repeatedly to control the world; they wanted to destabilise Russia and put in a puppet regime whom they could hold to economic and financial ransom. But they miscalculated badly with Stalin: this was before risk management became part of MBA programmes.

Check out how Adolph Hitler stashed away at least US$ 20 million (1930s value) in a 'secret' Swiss account from his runaway bestseller Mein Kampf which was faithfully translated into many languages. The Financial Moguls supported the Nazi's in Germany's takeover and probably thought that, because the guy looked like Charlie Chaplin, they could control Hitler. Another mistake.

Chaplin hit back with The Great Dictator (which Hitler reportedly watched in the final days in his bunker).

Yet, we have been brainwashed all these years to think that so much of what has happened has been the result of Democracy versus Totalitarianism and all that. Sure, there is truth to it. But this is the time for all those dark 'secrets' to come out on how the world's banks have been progenitors in creating the fiascoes that have caused this planet so much suffering right up to this very moment.

Imagine how many banks have had 'secret' accounts for war mongers, drug dealers and other sublime money laundering operations all in the name of the 'public good'...? Now the chickens have come home to roost, but they appear to be genetically engineered headless ones.

And the rest of the world's population for some perverse reason must pay the price for all this. That's the part that still doesn't make much sense.

How long will people sit down and moan and groan and watch how their future and that of their children continue to be mortgaged away through mammoth amounts of taxes that will have to be paid as a result of more bailouts of banks?

Perhaps banks do need to be controlled by communities and people and the government rather than capitalists intent on greed. The US Federal Reserve is not federal at all in that it is a private consortium that has long done damage to the US and the world through grasping men for whom the world is clearly not enough. They would colonize the moon for a theme park if they could.

What is to be Done?

It is time for people to sit down and form groups to create people power. There will be time enough when you are out of that job you're clinging on to and the banks shut down because another "toxic" account finally doesn't have more paper money to cover their unethical behaviour and 'secrecy'.

It is time to start writing to your governments and groups of influence to pressurise the start of removal of all such 'secrecy' to reveal the corruption that has held the world in captivity for centuries. It is better to act now than wait for the inevitable public disturbance that will happen when the whole system collapses on its head.

The best kind of revolution is still a bloodless one. And it is going to take a lot of strength to keep it peaceful.

Act now.

"But a usurer and money-glutton, such a one would have the world perish of hunger and thirst, misery and want, so far as in him lies, so that he may have all to himself, and every one may receive from him as from a God, and be his serf for ever more." Martin Luther, written in 1540

Capitalism 101

Capitalism Primer

The Full Version

Capitalism Hits the Fan

INTERDIMENSIONAL ECONOMICS (PART 1): THE ECONOMY OF 3D

2008-12-26T17:02:00.090+08:00

The Overdue Sunrise

Bailouts are not the answer. It is time to go beyond economics as usual and look into the metaphysical ideas which can take us out of the current economic quagmire. And we can get out of this mess.

For now, there seems to be no end to it. There seems no end to attempted bailouts for industries and attempts to fix a tail spinning US and world economy through lowering interest rates, and pumping in more money. The solution for banks, big businesses and governments (3BG) seems to be that when there is a problem, throw money at it and maybe it will go away. The ideas in this piece will look at how we got into this mess and a possible scenario of getting out of the quagmire.

The first part looks at our three dimensional economy (3D), which reflects the world as we live it. This analysis will be done under the auspices of Karl Marx’s ideas. This is not an apologia but a use of Marx’s ideas as a platform to bring forth my own.

The second part will look at what is termed a fifth dimensional (5D) economy. The 3D economy is an ego based one which we have been weaned onto since birth and have been led by the nose to believe is the only way to live. The 5D economy is a heart based one, in which we go beyond the claptrap that has held back the species and the planet all these years. In the latter, basic spiritual and metaphysical ideas will be looked at to help give a different perspective to where we can be heading, if we so choose, in our economy and our lives.

Please read this piece in order of Part 1 first and then Part 2, as the 5D ideas will sound like they are the product of hallucinogens that Coleridge may have used when writing Kubla Khan -- which they are decidedly not -- unless the reasons for the collapse of the 3D model have been examined.

The point of this piece is that we are not due for an apocalypse if we choose to create the reality that reflects the better angels of our nature.

The Economics of the Third Dimension

Marx has been misunderstood. Seriously. And I am convinced that he, above all other political thinkers, had seen right through the veil of ignorance of what a capitalist system based on its foundation of scarcity finally leads us to. Neither the hardcore capitalists nor diehard communists (those who are still alive) have any notion of what the Big M was up to. Marx was a philosopher who turned a devastatingly critical and accurate eye on what was happening around him.

Watch these wonderful films by the great Charlie Chaplin, and have an idea from film what Marx was on about: Modern Times, The Great Dictator, Monsieur Verdoux, A King in New York. In the first one you see man becoming a cog in the whole system of the assembly line of industrialization. In the second you see how industry and the vast maximization of capitalism works hand-in-hand with fascism. In the other two, see how trying to stay alive in the capitalist system means you have to live off the life of others (literally at times), and how the system is a natural bedfellow for all forms of dishonesty and hypocrisy. (The films are also very funny and entertaining.)

But does the world have to be this way? Chaplin gives some of his responses in his films, whereas Marx hits you with a velvet gavel via his great work. Most of the ideas in this piece are based on a reading of Marx’s major works: his biography written, and selected works edited, by David McLellan; Marx’s Grundrisse ("Foundations of the Critique of Political Economy"); his ineluctable Vol. 1 of Capital (and parts of Vol. 2 and 3); An Outline of the History of Economic Thought by Screpanti and Zamagni, and all major works of George Orwell.

Basically, what Marx was on about was this: that the neo-classical economists who come up with dandy ideas of supply and demand, and all those wonderful little curves and bizarre calculations have perpetrated one of the greatest frauds of all time (that was a euphemistic paraphrase of Marx). That notions of land, labour and capital as economic entities and products that, if juggled right, would lead us to utopia are what has gotten us, in many ways, into the rut we are in. Rather than focus on the unrealistic assumptions and nature of neo-classical economics, let’s look at the real thing.

Marx essentially claims that anything to do with the world of a human being has to do with human nature and human interaction with one another and the environment. The economy is a purely human affair because it has man in the centre, at the beginning and at the end. The whole purpose of an economy is to serve as a means for humans to deal with one another in a balanced and meaningful manner so as to lead fulfilling lives. So any aspect of an economy must be examined by its human relational aspect. This seems like common sense.

So the economy is all about how we relate to one another. The system of economic production used and the products that come from it are the result of human interaction; and how we relate to one another impacts how we lead our lives; that in turn coupled with the way we perceive the world etc determines our existence and the way the world operates. So it starts with man and ends with man.

However, the capitalist system is a different animal altogether. This is a system which with the connivance of 3BG has created a mechanistic behemoth of using land, people (labour) and capital as that which is turned into the cog of an industry (which includes the service industry) which then churns out a product that is thrown out for people to consume. This is then regurgitated back via income earned into more spending so that the whole glorious cycle can be repeated.

Some call this life, Marx calls it Capitalism, the rest of us call it the disaster unraveling all around us.

But Marx’s point was that when people as workers/labour are treated as a means to an end, as is what capitalism prides itself in doing, then there are consequences in terms of our relations to one another. Because what happens is that women and men who are supposedly born free to fulfill their destiny are now here to fulfill the destiny of capitalist production.

When the economic perspective is framed by capitalism then this is what occurs: all aspects of production, including human beings, are mere instruments for production for that which is meant for consumption. But this is a process that allows for labour (people) to be treated as instruments and dehumanized by the bosses/superiors/capitalists as functional tools in an industry (media, food, cars, education, health, military, etc).

Taking a different tack: I have taught at tertiary/college level institutions where teachers/instructors are told that they are hired to produce a product for the consumer/client/customer, that is, the student. If this is the attitude of education in many places today, do we still wonder why the world is where it is at? Many of the students I have taught say they wanted to go into ‘business’ (the ‘business’ of ‘business’ being ‘business’), or the ‘medical business’, or the health and education ‘business’ or the media ‘business’. When asked why they chose these fields, most honestly said: to make a lot of money -- the kind that today you can use as a substitute currency in your Monopoly game.

And as Marx rightly points out, what happens is that as in the education ‘industry’ or ‘business’ the relations between students and teachers change due to their mode of production. So I was told by my superiors back then to deliver a product (lessons) to my customers (students), and fill in forms to satisfy bureaucratic structures and feedback mechanisms as to how the product delivery went. The only thing missing here was the Ford motor assembly line.

In other words put on the work apron, and to hell with the students, their welfare and whether they learn anything, much less if they become ‘educated’ (what on earth does that mean today?); just churn out the stuff, make sure it meets the industrial ISO standards, do and say the right things to get my capitalist-inspired bonus for churning out as many courses, lesson plans, extra school/curricula activities, and (if I can be popular with the students at the same time) perhaps get some good feedback from my customers.

This has led to teachers becoming indifferent to their students, and simply seeing them as a means to an end, that is, their salary or rather their wage. There is hardly any concern for what happens to the student than a guy doing the rivets for a car in an auto manufacturing plant (those that are still open) cares for who owns and drives the eventual vehicle made, or how it is used.

But it cuts both ways for I have heard many students in the past complain to me about their other teachers and say that they do their readings or assignments because they choose to do so and depending on whether they like a teacher (!). And that the teacher should adapt to them, and not them to whatever ideas (which may be demanding) the teacher is trying to bring across because they pay the teachers’ wage/salary via their tuition fees.

Look at your own workplace and environment and see how working conditions and attitudes from this capitalist system makes people unreasonably competitive, confrontational, unforgiving and egomaniacal. This is the price we pay for an ego based system of reality that Marx warned us about.

For the capitalist system, it is not about people, our societies or the world, it is about our egos. And what would 3BG do without it. The cornerstone of the capitalist system is the feeding of egos, creation of scarcity, fear mongering, and enslaving of labour (people) in order to create more and more capital. For further insight into this please see The Economy of Scarcity.

Capital begets capital and all human relations are force fed into this structure of production which creates havoc among people relating to themselves and others. This in turn creates class, in which people seek to belong to a controlling situation or position which allows them to exercise power over others. This has little to do with putting a good person in charge to does things competently, fairly and reasonably. For Marx, the need for capital accumulation and results can change a decent person into a megalomaniac.

But this does not mean that no good ever came out of capitalism. It has provided great material wealth, and in modern societies many have acquired this material wealth. But capitalism’s unending, unthinking, knee-jerk reaction of continuing to voraciously expand itself via greed and the need to sustain itself has reduced humans to being desensitized to acts of violence between themselves.

The Capitalist Grind Mill

How exactly is the worker/woman/man/child dehumanized by the process of capitalism. Marx shows that labour loses out twofold via unjustified surplus value extraction and theft of the product of labour. A person is paid a wage that is sufficient for him to live and reproduce himself (as in supporting a family).

This is a minimal or necessary wage. The wage system is a reminder to a person that he has sold his labour power to someone who gives him money in return. This is like being paid to lick stamps in that your bodily fluid (for Marx labour power) of saliva has been sold for a service provided. This is a process of alienation for the individual from his human essence when he parts with something that he was born with and is to all intents and purposes sacred, but has been de-sanctified because it can be purchased and traded for money.

And people have been led to believe that this is the only way to live. The capitalist system as Marx keenly points out is really a snazzy version of feudalism, which for us means some credit cards and mobile phones thrown in.

The feudal lord owns the land and he determines who does what for whom and how, for what it is worth. The serfs, peasants, tenants or what you will, serve at his pleasure. He in turn is supposed to ensure their welfare in that they have enough to get themselves and their family through the day and reproduce themselves; this is important because the class of serfs must be maintained and kept in their place to continue serving the ruling class of landlords.

Bring all this forward to the industrial and information revolution and see how the feudal system of production has been reproduced in the form of capitalism which we have been indoctrinated to believe from birth is how the world is. Marx’s point, and that of any clear thinking individual, is that it is not the way it is or has to be, but how we have been brainwashed into accepting to keep the status quo.

Remember, when you a born, you come into a flow of time and activity which has preceded you in this master-slave relationship and your parents, family, society, and government all take it as a natural progression of things mostly out of ignorance. But the manipulators of the world know that the only way to keep the master-slave class structure is to control the financial and banking industry and buy over support through coloured paper that is printed willy-nilly as fiat currency.

That is why we need a comic genius like Chaplin to show how funny and ridiculous we are in accepting the agenda of manipulators and dictators.

Democracy today by any name is largely a capitalist master-slave relationship. We have been conned into accepting it by the illusion of material wealth that provides us and the world anything but peace, security and happiness. Because as Marx points out, the capitalist mode of production of alienation of our labour and labour power through a system of wages, takes away most people’s creative drive and sacred core by making them serve capital accumulation so as to accelerate it even further. Can this really be living?

Now we can take a closer look at the two fold deception that capitalism has used on us as Marx would put it. A person is made to work long hours and over time, as far as possible, to squeeze the maximum out of his time and effort thereby allowing for maximum product creation that can then be sold for as much profit as possible. This has got nothing to do with leading a balanced and fulfilling life.

First, there is the profit made from the surplus value of labour as explained by Marx. After all the costs of production are deducted including the wage paid, the capitalist makes a profit based on value gained from labour power, that is, the surplus value of labour. This means the exploitation of what labour can produce via a minimal wage paid to abstract its profit creating output. This is the only way for the capitalist to make a profit through the exploitation of variable capital, that is, labour. Labour is variable because it is born, can grow sick, old and die and needs constant reproducing to keep the machinery of production humming.

Most people are also eminently suited for manipulation (variable) and can be made to do more for less. It is hard to make a profit if labour is paid fairly for what it is worth for it needs exploitation to ensure value from which profit can be drawn.

Another classic example of surplus value extraction is the use of domestic maids. Take a situation of a maid coming from a third world country who will be paid in a currency of a richer country for her services. She comes to a household and, depending on how she is treated, in effect comes under a master-slave relationship with her employers. The maid is caught in a 24 hour cycle of being at the beck and call of her employers.

She not only cleans the home, she markets for them, washes the car daily, waters the plants, does baby sitting, cooks, washes up, endures the baiting of badly brought up kids, looks after the family invalid, and is taken to the employer’s business or relative’s home to do even more work.

Hey, maximization of the buck.

Now if different people were hired to do all this work, imagine the cost: in other words the fair wages that would have to be paid. But for a fistful of dollars, and a few dollars more thrown in as an annual Christmas bonus, the master-slave relationship ensures that the surplus value of the maid is exploited to the hilt thereby making it a profitable enterprise for her bosses.

Rank capitalism in a nutshell.

Sure, more people today are enlightened in their treatment of maids, but only after human rights groups caused government intervention in many instances of abuse. [This does not in anyway exonerate maids/employees who themselves have been guilty of nefarious conduct while at work]

Also look at the busy executives of today. Many have the favour returned for the way they treat their subordinates. The person is on call a lot of the time via email or mobile phones. There is an almost 24 hour work cycle to produce things. All technology produced is but a tool to impinge on labour in producing products for capital, since the nature of capital is to keep growing insatiably until its own collapse -- as is happening now.

Virtually everyone is exploited in one way or another as it is the nature of the capitalist beast to do so. So time and effort of labour is stolen to maximize production, hence, surplus value. The so-called ‘market pay’ (not that of top CEOs) for most people are usually less than what they are worth, and if they get what they think they deserve, they are worked to the bone to get every drop of surplus value out of them to maximize their firm’s production and profit margin.

Second, the product made by labour is in effect stolen from it. Here Marx uses his concepts of use and exchange values to explain how this sleight-of-hand is pulled off. Anything manufactured under capitalism is considered a product if it has a use value. So widget X is a product because it can do Y number of things deemed useful.

Exchange value is what is given in return for something, namely, wages paid to labour are an exchange for its labour power in production. So when the capitalist pays the minimum amount it can get away with (a.k.a ‘market rates’) to labour to produce, it has bought labour power to produce something. This is the transfer of cause and effect -- you buy something in return for something.

But, Marx points out, earnings that come from the sale of the produce of labour is a separate thing altogether. The sale of widget X for profit is not only sloughing off from surplus value, but getting paid for something for its use value. So the product of/from labour has exchange and use value, but while the capitalist provides some compensation in terms of wages for labour’s time and effort via wages (exchange value), he steals the product of labour for widget X (use value) by selling it for his own gain and profit.

It is testament to the great propaganda and brainwashing that we have undergone that most people -- never mind the economists who justify and perpetrate this scam -- will say ‘Wait a minute, but that’s how it works. The boss pays you, you work the machines, computers, phones and paper to get widget X out and he sells it, and gets his keep from it.”

No, not at all, says Marx. And he is spot on. Widget X could not be created if not for labour. You can get all the machines, and capital together, throw in a few MBA types and then say “Wallah!” But guess what, no widget X! To get the latter you need people/human beings/homo sapiens to put in their power to create widget X by working the capital and resources. And in most cases, people have surrendered without blinking an eyelid their product to the capitalist, which is the direct result of their time and effort and slaving away. This is a consistently ego based good thing for the capitalist.

What this means is that while the capitalist is entitled to some form of remuneration for his so-called work in getting everything together to ‘make it happen’ so to speak, he no more owns the produce of labour which he sells (widget X), than does the line manager who supervises production. Only the people who put their shoulders to the wheel can rightly say that widget X is the product of the sweat of their brow, everyone else just played a supporting role.

It needs to be said again and again: Widget X cannot exist without labour power, and if the capitalist claims neither could it without his role thrown in, then he is welcome to put his shoulder to the wheel and see what widget comes out of it. The workers/people can always till the land and grow things to eat and sell and survive as was done since time immemorial, or form a cooperative venture of their own to create a just and equitable system of work, and profit sharing based on their own use of their surplus value for themselves without exploitation.

But the list goes on. Marx further explains that labour in this system becomes alienated (as discussed above) by the capitalist system of production which is simply designed for a utilitarian result oriented approach irrespective of the harm it does to the individual, families, societies, the environment or the world. It is about making and accumulating things never mind how and what the consequences are.

Marx makes the powerful but subtle point that people are born, live their lives and die based on the capitalist and industrial demands of how they should fit into the world, follow a wage system that inordinately rewards greed, and the excessive and wasteful bonuses of ‘managers’ who have not done an honest day’s work in their life in the sense someone says of his parent: ‘my mom or dad wasn’t very rich, but she/he was an honest hardworking nurse or postal worker’; as opposed to ‘my dad works the politicians, nightlife, golf course, stock markets and earns tons for making sure that everyone else who supports that fat cat life of his continues to live on a minimal amount’ (hey, someone’s got to make those profits to give back to shareholders, man!).

People are alienated in their work and their lives. They clock in, clock out, and pay their bills and wonder what it’s all about: welcome to capitalism.

Man’s alienation from his work, from his colleagues and the class structure set up in making him jump to everything the boss says is a sign of a human being who has abrogated his or her right to be just that, a human being. The capitalist system of production produces relations that denigrate a person’s dignity to living in subservience, and fear with an entire legal system and state structure supporting it, thus spake Marx.

Not only because the system may not know better, but it’s a means of controlling people. The capitalist system of scarcity mongering, unhealthy competition, confrontation and instilling the fear of losing work and being unable to survive unless you are cog in the machine earning a ‘market decided’ wage is the reductio ad absurdum of undermining what it was meant to serve – human interest.

And this is done, as Marx pointedly notes, by having a large reserve army of unemployed out there to ensure that the system can throw out those who demand what is fair, and hire those who are more accommodating and willing to accept a lower wage, produce more, create more surplus value from which to abstract more profit: look and behold the wonders of globalization!

But the more capitalism exploits people to keep wages low, profits high, and CEOs and shareholders’ returns stratospheric, the more it creates problems in having consumers who increasingly end up joining the ranks of the unemployed reserve; and people become ravaged by the system, and they soon can no longer afford the products they once made.

This in turn leads to more fiat currency churned out via low interest rates, sub-prime lending mortgages, and credit card promotions to increase borrowing and spending. And if industry needs a hand, just give a billion dollar bailout and add that to the taxpayers bill. So in addition to all this, labour/people are saddled with currencies that fluctuate in value and taxes that sooner or later have to be paid, all in the name of capitalism.

Which brings me to one of the final insults to all decent people -- that labour, after its shortchanging, gets paid in funny money that is debt based in which the currency is backed by nothing other than a dollar that is but an IOU for nothing (no gold backs it to give it any value). And you can tell its funny money because its value changes all the time. Please see New Money to End All Money: Part 1 and Part 2.

And it does not stop there.

The Formula that has Brought us to the Brink

With his characteristic trenchant insight Marx describes beautifully how the general formula for capital works. There is, first, the process of C-M-C in which commodities are produced in exchange for money which is in turn used to acquire more commodities. This is the natural process of a healthy economy in which, e.g., crops are grown which are then sold and the money gained from that is used to get seed, fertilizer, animal feed etc. It is a sustainable process that keeps the economic cycle going.

But the capitalists opt for M-C-M in which money is used to gain commodities so that their sale can generate more earnings in dollars. So the economic cycle in capitalism is one that ensures that what was a means of exchange – money -- is used to create commodities for the sole purpose of accumulating more money. The focus of an economy is no longer on the production of commodities that best suits people as much as a means of churning out goods and services to materialize more money out of thin air (and banks abet in this activity with alacrity), so as to lead to even more money being produced.

The sole purpose of an economy becomes one in which the financial markets, speculation, manipulation of interest rates, faulty and shady loan and investment schemes bubble up from the cauldron of greed which has thrown into it: human dignity, sanctity of life and respect for the environment stirred into a witch’s brew of capital accumulation and financial meltdown. If this sounds bewitchingly familiar, it is because that is exactly where we are at.

Marx was prescient in saying that why even bother with having the C in the M-C-M formula, one might as well as remove the C and just look for M being created to generate even more M. And this is, sadly, precisely what has happened with the capitalist system of interest rates and fiat currencies. If in doubt in a capitalist system:

a. lower interest rates

b. lower it even further

c. find if it’s possible to just print and give out money, don’t bother paying it back because we ‘need to jumpstart the economy’

d. cut taxes to increase spending (especially for corporations and high income earners)

e. multibillion dollar bailouts that mean injecting more money to chase more money around (somehow the idea of more effective and meaningful production of commodities seems secondary)

f. forget Gresham’s law of bad money chasing out good money, you now have money chasing its own tail until it collapses from fatigue-neurosis and results in massive currency devaluation (a.k.a. inflation)

g. if necessary start another war, a great way to ‘jumpstart’ spending and create bombs and, even better, employment for people by sending them out to fight; and a little population control from this would even make Malthus proud – keep excessive human growth in check, after all balance is everything.

Today the inversion of Marx's dictum holds: a capitalist is a miser gone mad and a miser is but a rational capitalist.

When will we start to wake up?

Interlude: Reverse Engineering

Let us still hold on to the idea of the ego based self-first-everyone-else-last-approach-of-capitalism’s 3D economy. Even within the 3D system, we can see a way to stem the downward spiral and turn things around. Look at the C-M-C formula again. This is the approach that is needed. This starts with a massive restructuring of the monetary system and cold-turkey cure out of the addiction caused by the M-C-M drug.

The C-M-C approach is one which promotes commodity generation as opposed to $ generation as the purpose of an economy is to provide things of use and value for people, not hoard money as a means of greed, domination and manipulation of others. So every monetary transaction, as Marx explains, is a circuit that starts with the sale of C and ends in the purchase of C. The M is given to one person who gives it to another. That is the end of the transaction.

In the C-M-C approach, money is part of a transactional process, it cannot be used as a basis to generate further fictitious amounts by lending institutions or banks that leads to hoarding and speculation of it on financial markets.

If $100 is out there for something, then it returns back as $100 and remains as such. It started out as $100, it remains $100. It does not become $1000 from the vagaries and shenanigans of fractional reserve banking.

What is recommended here is that any investment made should be dealt with in a green friendly and win-win manner which will be looked at in the later section. In other words, honesty is the policy of the day (and for every other one after that).

What does this mean in concrete terms. It means looking seriously at creating a four tiered monetary system and the use of local/complementary currencies as explained in New Money to End All Money: Part 3.

What else would follow from this:

a. establish a gold standard (or something similar) for national currencies

b. use international and regional currencies that involve the use of (a) but are convertible into a basket of natural resources and social commodities which bring wealth back to people, societies and the environment

c. local or complementary currencies (as explained in link on “New Money” above)

d. international and governmental policies that see to it that ideas, resources and effort are channeled into production to ensure Green and People Friendly (GPF) solutions (see Genuine Progress Indicators for details)

e. establishment of interest free-ethical banks (see JAK Bank of Sweden) and those that use innovative methods and ethical policies (see the UK Cooperative Bank for details). It is also useful to have a look at Islamic banking guidelines which disallow the charging of interest and insist on an ethical framework for doing business.

f. no more financial markets (essential in removing the M-C-M equation from the system) but have saving and investment opportunities involving GPF activities with yields in terms of gold backed national currencies or local currencies. The yields/rewards from these investments can also be in term of points that can be transferred or created into local currencies.

g. creation of local, community, national and international job banks and data centres (which will also create employment opportunities) to facilitate transnational job placements for people and families (where necessary). This would be in line with GPF solutions that will also ensure a smooth and legal fast track in clearing immigration matters for qualified people on the move. This is NOT globalization, but global realization of a fair and just system of employment (to be looked at in later section). Governments and people will have to grow up and get past paranoia and prejudice to get things rolling on this score.

This is well within our grasp. It is time for people to wake up, get real, take their lives into their own hands and pressurize their governments to start in this direction. There is really no need to wait till some ‘doomsday’ scenario kicks in before we kick ourselves into action.

INTERDIMENSIONAL ECONOMICS (PART 2): THE ECONOMY OF 5D

2008-12-26T16:40:00.062+08:00

Metaphysical Interlude

What, you may ask, ever happened to the 4th dimension in all this? We shall leave that to dreamtime, astral projections and emotional energy and their stuff. The fifth dimension as used generically in spiritual terms is about the energy of the heart. So as we move from the Interlude above to where we are heading in after this section, a dash of metaphysics will come in handy.

If we are to leave the old paradigm of an ego based reality of 3D, then we have to look to creating and living in the new paradigm of a heart based reality of 5D. The confrontational mindset of me-and-mine-first attitude of 3D’s ego reality is sublimated by we-and-ours-first attitude of 5D.

One of the basic metaphysical principles of the universe in that all is mind, the universe is mental. Mind is indeed the forerunner of all things. Thinking makes it so. Marx, who tried to avoid metaphysics as best he could, may not agree with what follows but that is because he had his own ‘metaphysics’ known as the materialist conception of history in which the environment determined man and vice-versa. However, it must be said that Marx was far more spiritual in his ideas than many whom he criticized if only because he was a great humanist.

The reasons for Marx staying away from the term ‘metaphysics’ was because first, he was reacting against the ideas of the great philosopher Hegel (whose mode of thought he used anyway!); second, he had enough of institutionalized religion which supported the class and economic structure of the injustice of capitalism; third, he did not want people to rely on abstract ideas to save them when the problem was right in front of them, that is -- the machine, the capitalist and the way people were turned into machines, etc.

Marx’s ideas themselves seemed inherently contradictory at times not because they are inconsistent in themselves but because he was also using a kind of thinking in which something was either true or false, that is, a binary system of logic. The 3D reality seems suited for this. Anything that could be both true and false, or a variation of the two seems not to ‘make sense’ to most people. “You are either for me, or against me”, “It’s either Yes or No”, “Now or Never”, “If you do this, you can’t do that”. This is really a limitation imposed on the mind by a 3D way of thinking which involves structure, format, templates, a matrix, and way of thought that tends to aim for a mechanistic kind of certainty.

Marx’s idea of a Communist state was an ideal one but built on an ego based reality of what people should do that is good for all in order to benefit from a system free of abuse and manipulation. But that only begs the issue, in the end, of human nature. For as Marx well knew, the source of so many problems is precisely the ego and its clinging on to things out of fear and greed, and the need to assert itself over everything. Any attempts at Communism as history has shown us, inevitably ends up as the reverse side of Capitalism on the coin of human abuse – a currency that is fast falling in value.

Communism was not ever going to create the kind of future society Marx envisioned without bringing back the problems of greed and fear that are the basis of capitalism. And it is no surprise that Marx never gave a clear outline of what this future society was to be like because he would have been aware, that in order to have what he really envisioned he would have to dip into the dreaded area of ‘metaphysics’. Worse, he would have to say things that he criticized organized religion of saying/doing to hide the hypocrisy of its own self interest.

But his vision can be completed here even if The Man would not have quite approved of it. The way to get out of the 3D rut is to look at it from a larger, more inclusive perspective, and one that breaks though and transcends usual channels and structures of thought patterns.

Let's, first, take a look at how intention and the mental aspect of reality is implicit in Marx’s ideas. The fact that everything in an economy depends on human relations, means that it all depends on human perception and thinking. It is exactly because Marx says the mode of production determines how people act and think, and in turn determines how things continue to be done, that it goes to show mental acts shape our reality. Intention is everything.

Use value is there because people think a commodity has use. Exchange value is determined by human ideas and thought. Fear, hunger, greed and affection are realized and acted upon via the mind. The capitalist system shapes people into thinking that they can only exist and subsist in a modern feudal master-slave set up. But we all know that if you change your attitude and thinking, you change the way you see and experience the world and in effect create your own reality.

The man who walks away from an accident cursing the day he was born has a different world view from the man who walks away being thankful that he can still walk away from it. The first man’s reality, or that mental and virtual reality he lives in, is probably strikingly different from the guy who dusts off his shirt and tells his friends that he was really lucky that time. This is similar to the person who wonders how anyone could say “Good Morning” when in their minds it is “What the hell is so good about it?”, while there is another guy who says “I’ve seen worse mornings, and this one is a good one!”

Now imagine a situation where the mind of a person is centred on the heart, that is, the person’s world view, mindset and intentions are based on love, compassion, understanding, empathy and forgiveness. This changes everything. This changes the relations between people, the way they do things, and the entire setting of the home, friendship, work place and international relations. A change in this kind of mindset leads to radical changes in economic processes which then in turn react to change human thinking and so forth upwards in a virtuous cycle.

The universe is mental. If it can be thought and imagined, then it can be done. And as astrophysicists are apt to tell us there are dimensions beyond our 3D ego based linear form of thinking trapped in duality (separateness between ourselves and others). They say that the known universe (nevermind the unknown one/or parts) is composed of 4% matter, 23% dark matter, 73% dark energy: what is now known as ‘scientific’ is really more ‘metaphysics’. The scientists are beginning to grow up.

Dark energy, dark matter and light from stars and suns streaming in. Scientists use the term 'dark' simply because the human eye cannot perceive it nor can our current blunt instrumentation quite capture it; but its power and effect is inescapable. The term 'dark' here really means the absence of the 'light' of perception. It is no more 'dark' than the colours of the rainbow are dark just because the human eye cannot see them in 'white' light unless there is refraction. So what is 'dark' here may be mind-bogglingly full of light containing a spectrum of colours beyond the most hallucinatory of imaginations.

It is just that we have not got the right angle of refraction in which to produce that stunning vision. But that does not mean we cannot do so for we are aware of its influence and existence.

Which brings us to another great principle, that of polarity.

The cosmos is based on the polarity of dark and light, what we term ‘positive/negative’, ‘good/evil’, ‘life/death’, ‘male/female’, ‘up/down’, ‘depression/elation’, ‘bust/boom’. But there is a whole range in between. The 3D ego based mind sees duality of one extreme or the other, but fails to see that actually polarity can be transcended by balance and harmony into a state that puts it into a higher paradigm of light. The principle of Yin/Yang embodies this. Light prevails or there would be chaos. Light is the underlying reality of all (including mind) and we can bring ourselves to reside in that state of illumination.

Dark is the absence of light. You cannot get light from dark. Hate is the absence of Love. You cannot get love based on hate. But we certainly can reverse the polarity of any negative situation into a positive one. That is a mental act based on the heart. From there we can develop our progress into a natural state of balance if we choose to make it so. This is the sublimation of the dialectic that Hegel and Marx were on about but failed to push to its conclusion because they did not go beyond into the fifth dimension.

The 3D ego is stuck into thinking that duality and separation and multiplicity of identity is the truth. It thinks the physical world is all that there is, but Science now tells us that the physical is about 4% of the whole deal! There are dimensions and realities beyond limited 3D perceptions obscured by the ego's web of illusion. So imagine dimensions beyond the 3D body, imagine a dimension existing over and around the 3D heart (that somehow conveniently keeps pumping to keep us alive without any effort on our part). Think about it.

Imagine tapping into this dimension of the heart to go into 5D and create a reality that is heart based transcending the framework of what we perceive as the 3D world of matter and duality. We can create systems of thought and economic activities that emanate from this. We can move beyond the ego based illusion of separateness to the 5D one of Oneness. This is called the Law of One. The universe and all life in it is One, but it is perceived and experienced as being separate by the 3D ego. You cannot get One from multiplicity, you can get multiplicity from Oneness. You cannot get an Ocean from a wave, but you do get waves on an Ocean.

The Transition to the Heart

So let us take Marx’s ideas and where we were going in those interludes above to see where this goes from here. When a 5D reality exists, the economic relations of production change radically. You can be sure that in most cases any system of production, hiring, discharging from work, sharing of profits, treatment of the individual, welfare schemes, financial growth and banking will be based on a just, fair and equitable system of trust and understanding.

The quality of life will shoot up. Money is just a tool of exchange that will not keep people away from the enthusiasm of getting to work and being creative. When a product is made and exchanged based on 5D you know where it is coming from, and you want it to go where it can make a difference. An ethical approach to all commerce, societal and political relations will develop from this. It is no more about creating Widgets A to Z for profit maximization.

We now have a trickle up effect. The people make the difference. It slowly but surely becomes government of the people, by the people, for the people and will always remain so. It can finally and aptly be called Democracy.

With a situation like this there will be a trend towards global realization of Oneness. Whatever is done will reflect the justice and fairness in the life of the individual and community up towards national, regional and international issues. Individual interest is aligned to community interest which is aligned to national interest. National interest is aligned to regional interest. Regional interest is aligned to international interest. International interest is about the world's interest. And the whole chain works in reverse again.

Please see The Economy of Abundance.

Briefly, based on the proposals above a 5D reality would reflect:

a. A four tiered type of monetary system with the return to something similar to the gold standard

b. Active use of local/complementary currencies

c. Thereby more community based projects and economic activity which is modeled on C-M-C. This helps ensure that economic production is balanced into useful commodities being exchanged for M which is transacted for more useful commodities, because that’s what economic creation is about.

d. Abolition of the golem of money markets, or M-C-M, which has bedeviled us for eons.

e. To avoid surplus value exploitation, there must be a fair and reasonable share of profits that come from sale of products that are made from the combination of labour/people and capital. Example, a 50-50 split of profits so there are no stolen products by capital anymore. But if banks join in with interest free loans (using credit/reward ideas that stem from banking examples given above like the JAK Bank and Islamic financial practices) they can, with shareholder/investors, come out with a fair and equitable system of sharing between investors, labour and management in which labour gets the lion share everytime. This is no longer capitalism. This is a social economy founded on GPF (Green and People Friendly) solutions.

f. Shareholders are rewarded as above. No stock markets or speculation exists anymore as financial markets belong to virtual museums and libraries only. Gambling means gin rummy or mahjong, not the economic system of the world or a country.

g. No overproduction of commodities but reasonable amount of stockpiling is acceptable. Due to a more decentralized economic and political system that develops from this, accurate feedback loops that lead to sufficiency are created for what is needed to support the best interests of people. Where necessary, governments at home and abroad can cross boundaries to be of help to one another and their communities.

h. Mutual support, help and reciprocity is the driving force of nations and the world.

i. This in turns means that most ventures would be cooperative based including the financial organizations that grow and support this.

j. This entire system would work in tandem with Rawl’s idea of Justice as Fairness. This means that communities, societies, nations and the world work together on a political constructivist approach of reciprocity and overlapping consensus free from ideology. A heart based reality is a perfect fit for Rawl’s notion of justice as fairness.

k. The UN is there to ensure that just and fair practices exist and are sustained throughout the world. There will be less time for war and less resources needed for the military-industrial complex. The peacemakers will be the main guardians of the planet. About time too.

All these ideas formulated on a 5D system of heart based intentions also mean letting go of past hatreds, land grabs and whatnot. If a system of recompense for people and individuals for being exploited needs to be made through some system of finance or kind to get some form of redress and balance, then so be it. If the recompense is financial, then it would be done within the framework of money in a fixed exchange rate system, as no more fiat currencies would exist anymore.

This approach will also help the survival of and our balanced symbiosis with the environment. A heart based reality can only be real if there is respect for all life and that includes our obviously living and breathing planet. The earth is our home and it should be treated with unconditional love and respect and caring. We did not create it, but we certainly need to pass it on to other generations intact, richer and more beautiful: this is our duty as a species.

Not Endgame: the End of the Game

The ideas here are not, by the greatest stretch of any imagination, the be-all and end-all. They are only a platform on which people with better and sharper ideas and minds can take things to the next stage of formulation and, most importantly, implementation.

What we all need to do is to start speaking out, writing petitions and putting pressure on governments to start getting their act together to begin immediately on a new 5D paradigm of doing things. As I write this the IMF, and other such luminaries on the international scene, have announced that the world is headed towards a second great depression.

But this is really a phase of planetary detoxification that we are undergoing and any process of cleansing is uncomfortable at first. Yet we need to be clear on what this means and realize that we have to now start planning and working on ways of making a permanent change for a healthier and balanced lifestyle for all.

There is no going back and thank goodness for it. There is only a going forward to finally creating that reality which is the birthright of the human race and all beings on this planet. Switch off the mobile phones and TVs and try this exercise: do some deep breathing and centre yourself, and try to look at things as they really are.

a. We are a species on a planet with infinite life forms

b. There are dimensions and life forms beyond our current 3D knowledge

c. Time is not linear it is multidimensional. For instance, that is why we have wormholes in space and possible alternate realities/time lines which are fact rather than fiction.

d. We can shift our sense of time and thinking into many time frames at once and can live them simultaneously: we can have a conversation now, think of the past evoking emotions from that time, and anticipate the future and create a sense of excitement at the same time

e. So our reality is multidimensional if we choose to explore and realize it

f. We are on a planet hurtling around with other planets also going around the sun and miraculously not crashing into one another

g. There are infinite galaxies out in the ‘known’ universe, so just imagine the ‘unknown’ parts

h. Capitalism, greed, selfishness, excessive sensual indulgence, war and egomania is sort of out place in this expansive scheme of things. It is more like the attitudes of a spoilt and ridiculous kid who insists on playing with the toys of brathood when he has actually gone well past middle age

i. This is no longer a zero sum game of winners and losers, or of checkmate. This is the end of the ‘Endgame’ because it is the end of the game of polarity from which we have to awaken

j. We need to take the lessons from the game of polarity we have been playing and move on to the next phase of reality as a species

k. We need to start waking up to the reality that quite soon, we have to act like adults and take on the responsibilities of a galactic human race

l. We are not alone

m. We have never been alone

o. We will never be alone

p. The Light always prevails

Welcome to the (R)evolution

A new kind of economy: the economy of scarcity (part 1)

2008-08-13T17:10:00.013+08:00

That's the Way it Goes

Things seem to fall apart, and the centre cannot hold. The economy is going into a shambles, exploitation in all fields of life still goes on, violence and mistrust among people and governments are rampant. Somehow, this is what we have come to create as we have come to believe what we have been indoctrinated to believe among many things, such as the ‘free market' and that Capitalism is God.

But Capitalism has turned out to be the God that has failed.

This piece will look at how we have come to be hoodwinked and have tragically bought into the myth of Scarcity and what this means as current economic events unfold inexorably before us. It will also look at a possible scenario for the future, if we so choose to take that route, which can be described as the path towards Abundance.

The first thing we need to do is take a look at the Triumvirate of Trouble, meaning interest rates, fiat currency, and a closer look at the surplus value of labor (henceforth, referred to as the Triumvirate).

The first two have been dealt with in these posts (as well as posts embedded within them) and for those who would like an in-depth look at those notions, these are good starting points.

The two links are:

GPI

Money the beginning of the End: Part 1

But a little should be said about the first two aspects of the Triumvirate before more is said on the third aspect: the surplus value of labor (SV).

It is the Triumvirate that has led us to believe in what the capitalist system has done for us: apparently great material wealth, money all around, high growth, military and political power, and well, what more could you ask for?

Yet not all is well. Throughout history and over the last century in particular, abuse and violence domestically and internationally has seemed the norm. Poverty has been the defining characteristic of many in so-called poorer states at the end of the last century and the beginning of the current one. Now, poverty and uncertainty are fast becoming the hallmarks of even more countries including some of the most developed ones.

What has gone wrong? Naturally, there will be numerous theories and reasons for this. But one aspect of the situation that cannot be ignored anymore is the abject failure of the capitalist system. The Triumvirate in seeking to carve up the known world into areas that it can govern indefinitely has inevitably led to creating the contradictions that are now coming home to roost, big time.

Some of the major culprits in this game of debt and deceit are Big Businesses, Banks and Governments affectionately known as 3BG. Through ignorance and willful manipulation, the Triumvirate has been the ruling façade for many 3BGs.

Interest rates on money loaned are usually nothing short of usury which has been frowned upon by virtually every major religion in the world. Simply making money out of lending money has been a traditional way of forcing people to compete among themselves for even more money to pay off the interest on loans. A useful story to look at on how this works is the one on "The Eleventh Round" here:

The parable of the Eleventh Round

As for fiat currencies (see link on A new kind of money to end Money above), they have been the bane of economies in creating currency devaluation, unstable money, and constant inflation. A useful example is one taken from Ellen Brown's The Web of Debt.

Here we have an example of how 30 cents can get you a dozen eggs, but due to the currency fluctuations of fiat currency, the next day your 30 cents is actually worth 5 cents in purchasing power. But, does it mean that a dozen eggs are now transformed into 2 eggs (worth what 5 cents should be able to buy)? This is the price of not having a type of fixed exchange rate, but one that moves wildly depending apparently on the ‘free market'.

Thirty cents should be worth 30 cents, not 5 cents the next day. Twelve eggs are just that, not two. Yet that is the system we have bought into. We have allowed the manipulation by the US Federal Reserve and many other banks to issue currency based on nothing more than double accounting and a pyramid scheme with interest to boot. This is a system in which we are taxed in every sense of the word to sustain the interests of 3BG.

Think about it, a game of Monopoly has more stability built into it than the fiat currency system which we have taken to be as ‘normal'. In a game like Monopoly you get the same $200 dollars when you pass Go, you know what the fee for getting out of jail is etc. But in the game world of our current lives, we have allowed 3BG to determine the impossible, that is, we allow them to morph 12 eggs into 2 eggs overnight via the fiat currency system of arbitrary finance.

Does this make sense? Does it accord with any sense of reality? Does this sound like a just and fair system? Does this sound like what capitalism promised? Is there even a vague semblance to what democracy is supposed to be about? Who actually gains and is enriched by this? Look at your current economic situation and bank accounts and see part of the answer there. Think about this for a moment.

Let us take a look at a concept that is regaining prominence and use as a means of analyzing what has been happening around us, the surplus value of labor.

The Economics of Scarcity

We have been led to believe by neo-classical economists that there are limited resources for which we have to compete to create a sound economy. We have been led to believe in things called ‘factors of production' and how income comes from these factors; and that via the use of money and productivity we create growth. But pause for a moment and ask ourselves how we have come to believe such myths, which in the end increasingly hold no more credence than the story of Cinderella or Sleeping Beauty in the minds of many.

Simply this, that there has been an unprecedented amount of material growth and so-called wealth created since the start of Industrialization from the late 19th century onwards. We have bought these products, and seen many of them on TV, and are convinced that they ought to be sought after by media, marketing and advertising. A system that can deliver all this stuff and then some, surely WORKS. Communism has also failed (meaning the USSR and its brand of ideology) and remaining Communists (e.g. China) seem quite capitalistic these days. And yet, the housing crash in the US and the upcoming demise of Fanny Mae and Freddie Mac, and all that this is symptomatic of this tells of a different narrative.

To the surprise of many, Marx is coming back into intellectual fashion. It is also worthwhile looking at his notion of surplus value of labor (SV). My interpretation is an extrapolation of the ideas from the key works of Marx, including some brilliant expositions of his ideas in the form of David Harvey's The Limits to Capital and Resnick and Wolff's New Departures in Marxian Theory.

Basically, one of Marx's many conceptual breakthroughs in understanding how the economy, and capitalism in particular, works is his idea of SV. What we term as profit is basically skimmed off the value gained from what is produced by labor or all the rest of us working stiffs (irrespective of whether you sit in front of a computer...).

To simplify, when we pay labor X amount and sell its product for X + n amount and after cost deductions we have P as profit. The reason for that P is due to the fact that we have paid labor less than what it should have been paid for in the first place. It is exploitation plain and simple that allows for profit and, thereby, capital to grow.

What we think of as income that comes from various ‘factors of production' like land, labor and capital is essentially skimmed off SV that is recycled back into the economic system. So that the wages we receive are also from SV taken not only off our backs, but the backs of others.

Marx, of course, has a whole body of work to show this in all its complex and myriad forms. And most frightening of all, he not only largely makes sense these days, he seems to be well on the way to being proven right about capitalism in the way we are experiencing it today with all the hindsight and bloodbath of history to support it.

The thing is Marx has captured the essence of the way we live our lives in a world of duality. Because we believe we are all separate and are not One, we naturally fall into economic belief systems that lend ourselves to support the system of belief of 3BGs that convince us we live in Scarcity. There is a need to scramble for things and fight even more to keep them, and keep on fighting even much more to get more of them. It is Us against Them. The whole class structure to Marx is predicated on SV.

As long as one group of people live off and profiteer from the SV of others, they are the class of capitalists. So you can have people who profit from SV in the common work place or offices, and you can see the class structure there immediately: in the form of conspicuous consumption - the larger office, the bigger PC (or newest mobile phone), the car, the private secretary, the jet, the etc, etc. And due to duality we have been ingrained into thinking that it is what we should be aiming for as well. So we need to compete more (thinking that means being more productive), to move up the scale (class) so that we can be on the higher end of the food chain (SV exploitation), and finally we can then be the ones others kow tow to (success).

And yet we are so unhappy about many things, and the economy is falling around our ears. The thing is this, as Marx wonderfully points out, the whole capitalist system of duality leads to contradictions. Capital takes on a life of its own. In order for the system to sustain itself, it must create more capital. This leads inevitably to devaluation and the destruction of capital.

Capital has to insist on more 'productivity', more innovation to increase 'productivity', more markets, lower salaries (meaning ‘competitive') for most in the work force so that SV can be increased, and this can also be recycled as big bonuses for corporate bosses and shareholders (rewards).

The workers in the firms and those who buy the products are mere cogs in the system: the whole purpose of the engine of capitalism is to create more capital ad infinitum.

Just talk to those you know in the corporate world and those who run large companies and they inevitably tell you about answering to the board of directors about growing markets and raising profits, and answering to shareholders. Where in all this is the welfare of their staff and the quality of products that they are churning out?

It is all about profit and SV (even if they are worried about the quality of their products). The more the drive for SV ratchets up, the greater the need for even more capital accumulation. Couple this with interest on loans and fiat currencies and you begin to see why most people seem to be working harder, and yet not knowing how they are going to afford to retire in peace (if at all).

But it gets better.

You see, there is a terrible price to pay for all this capital accumulation -- it devalues. This is part of the contradiction that sets in. And in order to prevent and counter the devaluation yet more capital must be produced, more people and markets must be squeezed as even more devaluation sets in.

Among the many aspects of the price of devaluation:

Currency devaluation (inflation) and collapses due to excess fiat money being created.
Economic bubbles start and burst as in the Asian currency crisis in the mid 90s and the current housing collapse in the US.
More manipulations of financial markets to counter devaluation which leads to more financial and banking problems (as in Europe). The current shocks to the banking industry are a prime example of capital devaluation of playing the SV game in an unbridled manner. And there will be more to follow.
Globalization and the discontent this seems to be bringing to many. Not only does capital need newer markets to expand in, but cheaper labor to skim SV from, or how else does capital sustain itself and pay CEOs their fat salaries and shareholders their ‘hard earned' bonuses? And many in the West are wondering why they are facing unemployment as jobs flow to other places where it is easier to gain the edge on SV through much lower wages there than in the capitalists' home countries.
The ultimate form of devaluation: war. This also comes from the need to grab more resources (which we are constantly told are scarce) and expand markets to keep Capital alive and kicking. Also, when you have that much capital there's nothing like expanding your military, testing its equipment and munitions, and doing some population control at the same time.
Devaluation of human life which has become a means to an end, because people become capital. An entire matrix of politics and economics is created through the mythology of ‘free markets', ‘democracy' and ‘freedom' to allow capital and the 3BGs to gain from this (and those who hope to gain from this by aligning themselves to this class structure). People are there to fit into GDP figures and fight wars.
Alienation of humanity from doing any form of meaningful work or leading their lives the way they think they should be able to lead it. To many people, work is ‘just a job', it ‘puts food on the table' and it doesn't have to mean much more than feeding the three headed hydra of the Triumvirate and trying to stay alive.

One of the things Marx also introduced, especially in the path breaking volume 1 of Capital is to show that there are three basic ways of placing values on things, that is, we have value, use value and exchange value. The question Marx was aiming at but never seemed to quite ask and answer (though he may have done so in a way that was not clear enough to me at least) is what exactly is the value of something, or a product?

Recently, I asked a friend of mine who is a CEO of a company that is part of a multinational conglomerate what he thought was the value of a glass tumbler on the table we were sitting at. I told him discount the water in it, just consider the value of the tumbler itself.

He answered, as we all have been trained, that depending on the market and where it was sold the value of it would vary. This would depend on how useful it was (use value), and what its value was ($ amount). So I asked him, what did he think the so-called $ value of it was. He said that it could range from $5 per piece to even $50 depending on how it was marketed and what kind of demand there was.

So here it is, the ‘free market' and so-called 'demand and supply' are quite arbitrary. It does seem that the whole field of neo-classical economics has grown from this mythology in working out fantastical realms of ‘perfect markets' with ‘perfect equilibriums' while all those wonderful marginalist theories and intricate calculations are there to show that you can just charge what you want for a product if someone wants to pay that amount. There is no value as such, it is an arbitrary amount we place just like our fiat currency, that is, today $10 is worth so much, tomorrow thanks to manipulation or poor policies emanating from 3BGs, it's worth something else, more or less.

What this proves is that there is no way to actually ascertain a value of a thing. Without being too metaphysical, its value is, in all honesty, immeasurable (or im0). If it was not the case, then how is it possible for such wildly fluctuating prices to be given to a glass tumbler depending on ‘the market' and ‘demand and supply'?

Unless we want to insist that it has no value: now that takes us into even deeper waters which we shall stay out of here.

Because everything is im0 we can assign whatever value we want to it, including the failing fiat currency money value based on mythical theories of economic equilibrium (when in reality we are in a constant state of Disequilibrium).

[In due course, a piece will be done on how faulty the neo-classical concepts of economics are and possible ways to work round it and undo the damage it has done to us all. Fortunately there are pioneers in this, and it is a matter of taking the trail up from them.]

But this is the point I am trying to make: if an inanimate object is im0 how much so a human being? Can value actually be placed on humans in terms of $ and their output etc? This is what I believe Marx and many others, who see the severe problems of neo-classical economics, are trying to point out in their own ways.

A slight detour on this: just take a look at the wage system that has been introduced. This is what we believe to be ‘normal' and which we all live by largely because ‘we have no choice', etc. Peter Linebaugh in his The London Hanged provides some interesting insights on how capital punishment in English history (specifically in the 18th century) was a means of punishment by Capital.

That the landed interests of capital introduced and supported the gory mass killings of those who stole and defied the authority of the ruling class as a means of keeping people in their places.

The wage system is a means of telling everyone to know their proper place and not rock the boat and the structure of 3BGs so that everyone gets what they are told they are worth, take it or leave it. If you challenge this, then there will be laws that will deal with you. That seems to be one of the messages from Linebaugh's book.

When you can put a price on a person's head, literally or otherwise, it is easy to take the next step in the commodification of a human being: which is killing them.

Of course, it can be argued by many that severe crime needs to be punished and that psychotic murderers should not be able to walk freely, and many would agree to that if only to preserve some sense of order and sanity.

But the subtle point being made by Linebaugh, for instance, is that many laws and punishment (especially of the capital variety) are a form of punishing many who have come to their ways of crime because of the way capital accumulation and its devaluating effects have shaped people. When you live in duality, it is easy to harm or steal from someone else because after all it is robbing someone else and it is for your 'own self interest and is that not what society teaches we have look out for first and foremost...?'

Coming back to the point on value: the moment we place $ value on a person and his output and relegate this to ‘market' forces which are subject to the dictatorial vagaries of the Triumvirate and the self interest of 3BG, we begin to see why we are to a large extent in the situations we are all currently in around the world.

The cornerstone to this is our sense of duality in which we live in fear of scarcity of products, and $ (even though there is a lot of it, it is just not distributed evenly enough), anxiety over health, family and many other issues. After all, the other guy is out to get us (not that there is never any truth in this). It is this paradigm of scarcity, doubt and fear that lends us to control by 3BG and others. Greed is not good, manipulation of others for personal gain is not the high point of existence.

So where do we go from here? Perhaps, as a form of a thought experiment, we can look at one of many different possibilities. One such modality I would term the new Economy of Abundance.

a new kind of economy: the economy of abundance (part 2)

2008-08-13T16:15:00.029+08:00

The Economics of Abundance

If duality seems to be a central problem of human nature, how are we exactly going to change that? It seems that we may have little choice but to deal with changing it or at least making a serious effort at it. The current problems of the economy, apparent shortage of fossil fuels and environmental issues coming to the fore will necessitate, it does seems, an entire re-look at how we intend to lead our lives.

Some assumptions need to be made here. That the inability to squeeze more oil out of where we choose to squeeze it out from is going to lead to more scientific research on alternative energy sources, which is happening right now. For instance, perhaps the means will be found to harness not just solar and wind power, but the power that comes from the tides that rise and fall all the time. Turbines under seas and means of converting, storing and transferring such power could provide a serious alternative to fossil fuels.

Also let me further clarify what I mean by Scarcity and Abundance. The term scarcity was used in an economic sense earlier, but the mention of duality was meant to focus on a more esoteric sense of the term. With duality and a sense of mistrust we build among ourselves, we convince ourselves of lack and scarcity which is only reflected in our economics. This is not to say that fossil fuel is limitless and we can go on using it forever. This certainly doesn't seem to be the case. But when we live in a state of competition with everyone around us thanks to the Triumvirate among other things, we live in scarcity of what we can gain from life around us.

Abundance here means a mindset change that will lead to a change in the way we do economics which should lead to an economics that focuses on abundance. And that is looking at what is not only immeasurable in the im0 sense of the term, but what is truly Immeasurable or Im0.

Let's ask ourselves, what exactly is the value of the earth, the water, the plant and animal kingdom, and the human life on it? Is there really a $ value to this? Whose currency are we using? Is this a fiat currency whose value is less stable than that provided by the game money of a Monopoly set? Does this value vary? Can it ever be fixed? Who gave us this planet anyway? Are we just here by accident and so we can do whatever we want, to whomever we want, however we want? Does the concept of stewardship and passing on the world from one generation to another in better condition, or just as good a one, from when we inherited it make any sense?

What is being suggested is to look at one possible scenario. As more of these ideas come to the surface it is easier to interface with them and to put it this way: a more community driven approach is what is needed, and that is probably what we will be forced into anyway.

Part of this involves looking at a new currency system as mentioned in posts recommended above. It would also mean a way of looking after people and societies belonging to low income groups in a sustainable manner, as opposed to just giving aid or charity, or hoping they will die off with as little inconvenience as possible. One direct link to this concept of social businesses can be found here:

Social Business

This will also call for greater use of local/new/complementary currencies. Another direct link:

Complementary Currencies

This would take place within a broad political framework as envisioned by the great political philosopher John Rawls. His vision is for a political conception of justice in democratic societies. A link to help see more of Rawls's ideas in detail:

Justice as Fairness

What these ideas allow for is to try to lessen the view of duality of ourselves and to see ourselves as One. This is a hard call, but no less difficult than problems we are heading into. My point is, for those who don't believe in altruism and the like, learn to accept the fact that we may not have a choice but to work with one another closely, which may be bad news for the cynics out there.

It is interesting to note that a film like The Dark Knight addressed some of these issues. For those who saw the film, you will remember the ending when different boats of people (one full of convicts) had the choice to blow the other up so as to save themselves from all being blown up by the Joker (played magnificently by Heath Ledger).

Sorry for the spoiler here, but duality and the mentality of scarcity almost led each boat to blow the other up, yet somehow neither did so. And Batman, of all people given his issues and complexes, says that people are capable of much more than just survival instincts that have been ingrained into them.

But going beyond the movie, there needs mention of the ideas from a fascinating thinker -- Georges Battaile. In his masterpiece The Accursed Share, Battaile talks about how economies are driven by exuberance and waste. A rich economy or the very wealthy exemplify this by being wasteful and extravagant to show that they can afford to destroy surplus. The ultimate capital accumulation devaluation as Battaile himself concludes is the destruction of humans via war (for example), and that is because that ‘surplus' human being can be ‘wasted'; hence, that particular human is becomes the accursed share.

This resonates with Marx's notion of how capital leads to the contradiction of devaluation and destruction of itself and all that it requires to keep itself going. This in turn rests on the fundamental view of duality between us and others that engenders the exploitation of the world and one another.

Battailes raises another important point. If there is scarcity around, how is it that we have population explosions or life coming into being. There is, if anything, a great deal of energy and exuberance around the planet and in life forms. There is plenty. There is abundance.

We simply choose to believe otherwise and to live in duality from others. With the belief of scarcity and competition (reinforced by 3BGs) we exploit, abuse and waste resources as a result of following a system of capital accumulation and devaluation

What we need is balance.

If, as this thought experiment goes, we do see ourselves as One. Then in a community form of living within the context of our larger society, country, regional grouping, the world, we will start trying to build collaboration and trust. Some of these ideas are eloquently explained in Deep Economy: The Wealth of Communities and the Durable Future by Bill McKibben.

In terms of the new kind of money we can use, there are complementary currencies used in the form of time banks. For instance, people do services and give things to others in exchange for other services based on the time they log in which is generated into a form of points/currency. So some people may car pool and someone does the groceries for a neighbor, in return for someone doing their laundry or cooking a meal.

In terms of straight forward barter, a couple I know in England exchange the local produce from their backyard for produce from their local grocer.

As things in themselves are im0 and in the greater scheme of things Im0, barter exchanges, time banks, and complementary currencies as means of value, use value, and exchange value make complete sense, and are non-exploitative. There is no surplus value being skimmed off, as what is being done is largely from goodwill and cooperation.

But many have questioned this idea of goodwill, and one person told me that goodwill is not the answer because in the ‘Real World' that's not how things work.

Well, we are all still awaiting for someone who actually is the expert on the ‘Real World' to help solve the world's problems. My counter query to the ‘Real World' exponent was if he fell down on the street and needed help to get up because he was injured, would he ask for help? Or did he think that in the ‘Real World' no one would bother?

The answer was since it had not happened to him, he could not know but he knew many instances when people wouldn't bother to help others (presumably because they were answering to the dictates of the Triumvirate)...and that's in essence the ‘argument of the Real World'.

Yet, everyday, we manage to get by with our difficulties because many times people just decide to try and be decent about things. Amazing, but true. A community that sees itself as One, and a society and world that see itself that way, can slowly but surely edge past the Triumvirate which is in its state of final decline and move onto a new paradigm.

Perhaps, to the ‘Real World' enthusiasts they may grudgingly accept that if for no other reason than to survive, we will have to make a move towards community living and use different ways to measure progress.

This will make us see that if we do not rush and want MORE all the time, that there is such a thing as enough, that there is such a thing as balance; and that people who have had enough of the way 3BGs have been doing things will take advantage of the coming economic difficulties to demand from their leaders that things have to be done differently, and a new way of thinking can be brought into place if only it is given a chance.

It will be rightly pointed out that perhaps I have not given enough details here about what this Abundance really is and I would humbly agree to that. Perhaps we are still some way off from things like genuine trust, neighborliness, mutual respect and consensual agreements in deciding things; where people and the environment are given a priority and go beyond mere $ measurement, because the human species and the planet it lives on is Im0 in value. Pehaps that's because we are in the process of creating it and we haven't gotten there yet.

But I would also point out this parallel. Many never could have imagined the depths of suffering and horror that people could live and survive through. Yet the species has gone through innumerable wars, concentration camps of all types and tortures of the vilest sorts.

Is it so hard to imagine a human resilience in a reverse situation that goes onto a different paradigm where the horrors are a thing of the past and, while there will still be some fighting and differences among people over various issues, we start to live with a sense of justice and fairness, of balance, of community; and in the good that comes from this a mindset of Abundance, and an economy that finally reflects it.

To all the nay sayers I have only this to add for now.

Has it ever striked you as strange that we live on a planet, in a solar system, in a galaxy in constant motion in a Universe that is Im0 (which may be just one of multiverses as science now reluctantly admits), while many still think that the purpose of the human race is to make more Coca Cola and bombs?

It takes a certain kind of Ego to think the Universe revolves around us.

The Copernican revolution was meant to show us how wrong we have been, and we still are.

It is time for us to try something different.

justice as fairness revisited

2008-07-09T07:06:00.014+08:00

THIS IS A SHARED PATH
Cyclists, dog walkers and pedestrians
please show consideration to
those using the path with you

The words above were copied down from a sign over a path that diverged from a walk that connected Kingston-Upon-Thames to Richmond in England. From my recent observation, people seem to instinctively understand the value of following these words that call upon their sense of mutual respect and reciprocity.

In fact, these words capture the essence of the ideas of John Rawls: surely the finest political philosopher of the twentieth century.

The hard core socialists may say of the above sharing of the path, that everyone can use it because it belongs to everyone; those who do not necessarily believe in anything particular in their political views may think that anyone should be able to use it unless a sign says that you should not; the hard core capitalists may think that you do not trespass on anything unless you own it, and if you do then there is no reason not to make a profit from allowing people to walk on it if you want.

The person who understands justice as fairness will probably think that if you walk on a path, then you give the same respect to those using the path that you would also expect from them.

This post is a re-look at some of Rawl's key ideas based on an interpretation of central concepts from his key works like A Theory of Justice (Revised Edition), Political Liberalism (Second Edition), Justice as Fairness: A Restatement, The Law of Peoples: with "The Idea of Public Reason Revisited", Lectures on the History of Moral Philosophy, Lectures on the History of Political Philosophy, and a continuing foray into the Collected Papers.

There are an increasing number of introductory works on Rawls and, personally, believe that the best primer is Samuel Freeman's Rawls (Routledge Philosophers). There are of course various Net resources that can be looked up as well. Links and some resources are provided at the end of this piece.

Rawls's ideas are for a well ordered state that is generally a developed society with democratic traditions. There are three main ideas that a society that subscribes to justice as fairness will incorporate:

The two principles of justice, overlapping consensus, and public reason.

Many of these ideas, it must be stated, have been revised by Rawls over the many years of his fruitful work.

One of the assumptions Rawls makes is that people are capable of a sense of right and wrong, as well as a sense of justice.

And in a well ordered society these two principles of justice will be generated:

a. Each person has an equal claim to an adequate scheme of basic liberties, and fair political value.

b. That there are fair and equal economic opportunites for all. And that social and economic inequalities are to be arranged to the greatest benefit of the least advantaged members of society, which leads to the difference principle:

c. that is, arrangements in society that look after the interest of the least advantaged in society.

(There is also the Just Savings principle in which each generation adds to the wealth of a society to pass on to the next generation, and so forth)

This provides the basis for a society to balance freedom, opportunity and duties. The principles are also to take a lexical priority in their enactment meaning that there must be a satisfaction of the principle of liberty first, before it can lead to a proper satisfaction of free and fair economic opportunites and access to public/official posts, and before proper attention can be given to those whose interests need attention as the most disdadvantaged in society.

It must be noted that in the case of the difference principle, Rawls is appealing to working citizens who are in the most disadvantaged positions. It is taken as a given that the interest of those who are handicapped and have special needs etc, will be taken care of by societies in their own manner in accordance with a sense of justice. Rawls in his political conception of justice is looking to basically establish a political framework for a just and fair society which will, naturally, have to be tweaked to suit the society in question.

Rawls makes it quite clear that his ideas are NOT an ideology, they are a set of guidelines and principles that will be adapted accordingly by different societies. That it why he introduces the idea of reflective equilibrium and political constructivism.

Reflective equilibrium essentially refers to an individual or society reaching a point of understanding and balance for all its differing views which can be translated into a social contract with the government of the day on how a country should be run. Based on one's/society's reaction on the ground to issues and different views of people, the set of one's principles are adjusted to accommodate these ground realities. In fact, new ways to interpret and enact one's ideas come into play because of such readjustments and fine tuning of ideas in practice.

Political constructivism would follow from this in the sense that the political institutions of a state and in particular the leaders concerned help construct the political framework of a society based on adjustments made with action and reaction from the body politic.

This makes it impossible for an ideological approach to anything to take hold for long.

The process in which this occurs is via Overlapping Consensus which applies in particular to multicultural democracies (which is increasingly the trend of most democracies). The consensus comes about through the reaction of different people bringing in political judgments based on their upbringing, values, cultural and religious influences which shape their perceptions. But in the political construct in which the consensus occurs the sense of justice and political actuality shapes the views that a society can accept in reality.

We need to bear in mind that this has nothing to do with expedience, but rather in doing what is right in a fair and just manner.

People can bring in arguments as to why a certain policy must be issued or interpreted in a certain way based on, for eg, religious grounds but with the Proviso that its justification when brought in is discussed in a manner that can satisfy all concerned in a multifaceted society.

This process of interaction to ascertain such ideas and policies and ways to enact them as described above is also known as the process of public reason.

An example: abortion in many societies is a controversial issue. In a multicultural democracy the way a just and fair political decision is made (and the ensuing laws put into motion) would be done in the context of public reason and the consensus that allowed for it.

So there will be many who are pro or anti abortion based on their cultural, religious and personal views of the matter (of course many may just be indifferent for various reasons as well) known as burdens of judgment. But the decision made on the matter, while reflecting all these views and been tested against the principles of justice, must be one that also allows for mutual respect and reciprocity.

Rawls is really big on being reasonable. That is the trait of civilised societies, at any rate.

Therefore, those who are against abortion do not have to undergo it, can call for proper measures to ensure that the practice is not taken lightly, and would want to exercise their claim to protest against it.

But just as they want to be able to do the above, they must realise on this shared path of democracy they are on, that those who want to have access to legalised methods of abortion for their own reasons are entitled to do so. And the pro abortionists would also make claims to being able to state their views, campaign etc.

Naturally, this is far too complex an issue to be dealt with summarily but it should, hopefully, make clearer some of the ideas expressed here.

At any time, when people insist on one point of view without proper regard for that of others and aim to stifle it because they believe they have a monopoly of the truth, then they are not only making it difficult for justice as fairness to operate, but will be making it difficult for general principles of democracy, as most of us understand them, to operate as well.

The bottom line for Rawls is really balance.

A true ecology in politics of avoiding extremes and trying to find that point of equilibrium which, naturally, is always shifting to reflect the dynamics of a society.

To some it is like the Aristotelian golden mean, to others it is like mentioning the old Edwardian family table-saying, "I have reached an elegant sufficiency and anything additional would be superfluous."

So often, people's ideas of justice mean what they say goes, and fairness means things going according to their interests. Unfairness, is when others have things go their own way instead.

But if we drop our obssession with our egos and learn to conquer inner foes and look towards balance, fairness and a sense of right and wrong, we will realise that first, after looking to our own faults which may be in dire need of cleansing, we should look to living in peace, balance and harmony with everyone else as far as that is humanly possible.

Needless to say, Rawls's ideas have not been popular among hate and fear mongers.

Arrogance has never gotten anyone or any society very far without generating equally severe enemies.

Unsurprisingly, Rawls himself was man of great humility.

Some starting points for discovering more about Rawls:

Guardian Obituary

London Review of Books

New York Review of Books

Stanford Encyclopedia of Philosophy

Robert F. Kennedy

2008-06-05T14:15:00.042+08:00

In Memoriam: 40 Years to the Day

"Death closes all: but something ere the end,
Some work of noble note, may yet be done,
Not unbecoming men that strove with Gods.
The lights begin to twinkle from the rocks:
The long day wanes: the slow moon climbs: the deep
Moans round with many voices. Come, my friends,
'Tis not too late to seek a newer world

-- Ulysses, Tennyson

RFK on Vietnam War

In His Own Voice

Eulogy by Ted Kennedy

Money: the beginning of the end: thesis (part 1)

2008-05-30T12:10:00.009+08:00

"The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in inequity and born in sin . . . . Bankers own the earth. Take it away from them but leave them the power to create money, and, with a flick of a pen, they will create enough money to buy it back again. . . . Take this great power away from them and all great fortunes like mine will disappear, for then this would be a better and happier world to live in. . . . But, if you want to continue to be the slaves of bankers and pay the cost of your own slavery, then let bankers continue to create money and control credit."

-- Sir Josiah Stamp, director of the Bank of England,
speaking at the University of Texas,1927

Money to end all Money

This piece will look at the new money that is coming into being and which will replace Money as we know it. Money will still be in use, but it will be of a nature that reflects the social relations between people as one that engenders cooperation and mutual respect. As such, I will not traverse more familiar territory that has been explored and expressed better than I could ever do. What I will do, is look at three stages in the move from today’s crumbling debt based monetary system, to the transition and establishment of complementary currencies (CC) holding sway: this would signify the end of Money as we have known it.

For those of you who may not have heard much about CCs/new money before and how they are the part of the wave that is cresting and which will move with us right into the future, then I would suggest some excellent starting points. To have a good acquaintance with the current crisis in money and credit and to get a better perspective of what follows please check out the following:

Reality Sandwich blog entries on “The End of Money?” at http://www.realitysandwich.com/end_money by Daniel Pinchbeck and “Money: a New Beginning, parts 1 and 2” by Charles Eisenstein at http://www.realitysandwich.com/money_a_new_beginning and http://www.realitysandwich.com/money_a_new_beginning_part_2
The other site that is recommended strongly is Eisenstein’s “The Currency of Cooperation” which is an excellent primer on what the new money is about.

For those not familiar with CCs/new money, and who have not taken the time to look at the above sites, I humbly absolve myself for any boggled minds in what follows which may start of as a familiar language, then turn to one of only verbs or nouns, and finally metamorphose into hieroglyphics.

The Three-Step Move

The three stage move I am looking at towards new money is descriptive as it is prescriptive. The first stage will involve a move to a new gold standard due to the impending collapse of the US dollar (USD) and other major fiat world currencies. The dollar will still be in use in the future of course, but it will collapse mainly as a global trading currency and in being used as a reserve currency by national banks of some countries. The second stage involves the rise and enhancement of social businesses as envisaged by Nobel Peace laureate Dr Muhammad Yunus. The third stage will see the establishment of CCs/new money as the prime form of value exchange, relegating national currencies to a limited role.

We need to be clear in understanding that national currencies will not just disappear. The role of CCs is that of complementing other forms of currencies. What will transpire in the years ahead will be the rise of a highly sophisticated system of barter with decentralized sources of new money taking centre stage thereby relegating national currencies to a disciplined and specific role.

The current credit crisis the world is facing is a result of an untenable debt based system of monetary expansion. This is primarily due to the effect of central banks like the US Fed which expand the money supply through the banking system via a pyramid scheme of expanding money which does not actually exist. This comes about by a system of double entry book keeping and expansion of credit. To get a good idea of how this works, check out the wonderful The Creature from Jekyll Island by Edward Griffin.

This pyramid method of expanding money supply has been possible largely due to the use of floating fiat currencies, meaning money that has been unhinged from the gold standard and subject to being printed whenever it is convenient for it to be cranked out. This is soft money that has no tangible backing. A gold backed currency is a hard currency. The US only went off the gold standard in 1971 thanks to President Nixon thereby forcing other nations, by 1973, to all have full floating currencies as well. The reason for Nixon’s move was manifold, partly due to a misunderstanding of how the gold standard works and also, as is sometimes mentioned, the need to print more money to finance the Vietnam War.

Politicians tend to veer away from the discipline of the gold standard because it forces them to stay within the base money supply and ensure convertibility of their national currency into gold. This makes it difficult for self serving political projects and what are now known as earmarks (of the pork barrel kind) to be fully put into play unless there are lots of cash swirling about. But too much money in the system tends to lead to devaluation and eventually inflation which is devastating especially to low income people and the middle classes. Ron Paul’s latest book The Revolution: A Manifesto touches on this specifically.

Please do check this out for greater insight into the matter:

http://www.lewrockwell.com/paul/paul319.html

The fact is the gold standard has long been a preventive cure for unnecessary wars. That is because politicians cannot just print cash to justify their next act of international ambition. It may be of interest that as this is being written, USD has fallen to almost $1,000 per ounce of gold. This is just the beginning. This fall in USD value is a massive vote of no-confidence in the politicians at Washington, politicos at the Fed and chieftains of the banking industry.

Recent headlines are the rising of oil prices to USD135 per barrel. What is not fully explained by the media pundits is that this is due not to a shortage of oil as such, but to the devaluating USD. There is far more money in the system than demand for it, which is the classic cause of inflation as we know it. So calls for oil from strategic reserves to be used, and trashing the arctic and other areas for even more oil is NOT the answer.

Fiat currencies are among the principal causes for misdiagnosing problems and leading to even worse ones. A similar spike occurred in oil prices, as research will show, in the early 70s after Nixon wrenched the US off the gold standard. Yes, there were problems in the Mid East (when were there never?) but the surge in quantity of fiat USD was central to the rise in energy prices.

But the monetarists and the neo-classical economists that are largely responsible for the economic rut we are in are great believers in fooling around with the money supply. It not only, they think, gives us lots of “moolah” but allows the economy to expand. Yet, what it does do instead is lead to bubbles and booms and busts. Money becomes a tool manipulated via interest rates by unelected super bureaucrats at various central banks.

For instance, check out a recent book by one-time Fed governor-general Laurence H. Meyer in his A Term at the Fed during the crucial years of 1996-2002. He states that the key things the FOMC (Federal Open Market Committee) were interested were NAIRU (Non-Accelerating Inflation Rate of Unemployment) and the Taylor rule. What this basically means is that Fed gurus would manipulate rates based on economic theories of the Phillips curve and what the acceptable rate of unemployment was before inflation would kick in; and also when GDP would move away from expected/estimated GDP growth: all this would make it necessary to raise/drop rates based on projections. How effective do you think these people can be within the constraints of the highly charged political framework they operate in? Look around you for the results.

Also, it is worth checking out Bonner and Wiggins’s book Empire of Debt to see why the USD cannot last as it is the way it is going. How can the world’s greatest debtor nation with trillions of dollars of debt carry on by increasing expenditure, lowering rates, and not a sign of increasing taxes on the horizon? How much of this money that is being pumped in can stay the course without leading to severe devaluation? Is there productivity to match this artificial influx of cash into the economy? To what extent can you tell a drunk that the way to get over his inebriate state is to drink another bottle of vodka 75 proof? Who will pay for all these debts (or clean up after the drunk for that matter)?

What is happening now is similar to Americans who go to a diner, have a meal and tell the cashier to pass the check to their grandchildren. The future generation will have to pay for all the current debt. It looks like there is going to be a massive devaluation of the USD coming up (best way to settle debts is to lower the value of what you owe too) and, alas, record hyperinflation. At the first sign of this, or something to this effect, states like Japan and China are going to throw their US bonds in saying “Give me the money!” When that happens there will quite likely be a run against the dollar world wide, and then my friends, financial meltdown takes on a new meaning.

Money: the beginning of the end: antithesis (part 2)

2008-05-30T12:09:00.008+08:00

All that Glitters is Sometimes Gold

"It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."
-- Henry Ford

That is why the historical move as practiced in the past will be the viable return to gold. It has been tried, it has been tested, it leads to economic growth and expansion because it is stable money and brings along low taxes. But we will also have been so badly bitten by fiat currencies, that CCs and new money will be the answer whether anyone likes it or not. If you do some research you will find that even Marx advocated a gold backed currency.

We will finally come to see the need to move beyond the blinkered cost-benefit analysis of neo-classical economics to a new kind of economics. Part of that involves going back to basic human values, of older ways of life, of ancient spiritual teachings and practices, and an ecological approach to economics. Part of this process involves going back to mutual trust and reciprocity between people and to the system of barter represented by CCs. Part of this also involves going back to what has worked for millennia, the gold standard.

A new gold standard does not mean 100% reserves of gold backing a currency hiding in a vault somewhere. The new gold standard would be something as advocated by Nathan Lewis in his outstanding Gold: the Once and Future Money. Basically, how it works is that all the currency in a nation will be backed by a value of gold per ounce. What Lewis suggests for the US is a range of USD 360-380 per ounce of gold (lots of USD will have to be recalled and done away it).

The issue of convertibility comes in when the government authorizes banks to give back gold certificates (representing the gold) to those who want to cash the USD for gold. The use of gold certificates is how gold is bought and sold today, nobody goes around lugging nuggets and bars anymore (as some critics think). The banks will hold enough gold as reserves to provide for conversion if required, but this will not happen often as long as the money supply stays disciplined to the value of gold at the fixed exchange rate.

This is where the value of convertibility comes in. Convertibility ensures that the Fed/Treasury maintains and adjusts the base money supply to allow for the demand and supply of USD based on people’s use of Money aligned with the backing in gold. This calls for financial discipline and an end to fiat money 100%. If the supply of money exceeds the gold backing, and that leads to people trading in cash for gold, the Treasury sells gold to banks and takes in cash. If and when the opposite occurs, the Treasury buys gold back and provides cash accordingly. This is a self regulating mechanism akin to what Adam Smith envisioned. The interest mongering monetarists will no longer be the uber bureaucrats controlling fluctuating rate mechanisms and swinging currency values.

The range of movement for gold prices will be minimal. One reason is because only 2% of gold is mined worldwide every year and there is only limited use for it. Apart from dental work, limited industrial use and jewelry, gold is a singularly useless metal. Apart that is from being used as an ultimate Monetary measurement – its sole purpose of existence. And anyone deluded enough to try to hoard gold is going to find that he is going to need cash sometime and will have to, well, trade the gold in back for gold backed currency. With the rise of CCs and new monies, there is hardly going to be a scarcity of national currency. This will also spell the death of the money markets as we know it. In itself, when the gold standard is in play, the gold does nothing for hoarders because the national currency is now as good as gold.

The system would work the same on the international level and unlike what Nixon feared was happening, countries that move back to gold and trade with the US are not going to start throwing USD back and say “Send me the bullion, dude!” They will have the same process in exchange for gold certificates as individual users of currency. What matters is that as long as the US money base is not inflated (as per fiat currencies), the strict discipline and convertibility of USD to gold means they do not need gold to be shipped to them. When they know they can convert USD to gold and trust has been sealed on this, they simply exchange the gold certificates again to buy back the very stable and clearly guaranteed USD. Also, in all this exchange the gold does not physically ship away; what happens is as was done in the post Bretton Woods period, the gold is shifted to an account of the country in the secure vaults of a bank.

So now we have a stable money system backed by gold. There is a fixed exchange rate that ensures this. Gone are the days of currency speculation and falling USDs. But wait, shout the final coterie of monetarists out there, how are we going to create money now that the Fed has been reinvented, and since fiat money and its printing presses cannot just operate to satisfy the political whims of those in charge: how are we going to create jobs, they scream.

Well, by being actually productive for a change and not via the so-called productivity of the wild speculative frenzy of money markets. Interest free banks will operate (some research will show that they exist) and the pyramid scheme of double-accounting-money- expansion will be replaced by the rise of social businesses and CCs. We do not need so much money to make things work. National currencies backed by gold will serve the purpose of official government transactions and trade, while the new system of money will complement this and start a new productive and healthy drive to creating genuine wealth.

A Marxist way to be Capitalist?

Then comes stage two of the Three Step Move. In order to lessen the burden and need for national currencies, the social business model will start to play a prominent part around the world. This idea is an extension of what was put forward and practiced by Dr Muhd. Yunus who won the Nobel Peace prize for his idea of the Grameen Bank which gave microcredit to the world’s poor. In his latest book, Creating a World Without Poverty: Social Business and the Future of Capitalism, Yunus explains that a social business is an enterprise quite different from a cooperative or a charity. It is essentially a business set up to provide necessities for the poor like drinking water, food or healthcare.

In Yunus's own words on social businesses from the book:

"...a business designed to meet a social goal...a business that pays no dividends. It sells products at prices that make it self-sustaining. The owners of the company can get back the amount they've invested in the company over a period of time, but no profit is paid to investors in the form of dividends. Instead, any profit made stays in the business -- to finance expansion, to create new products and services, and to do more good for the world."

So companies or people put in capital to set up the business and provide low cost products for the poor. Once the money invested is earned by the initial investors, all other money that comes in goes towards financing the business itself. Hence, this becomes an exemplar of a self sustaining enterprise. This is a non-profit, non-loss business which does not answer to shareholders in providing them great returns on equity, just the basic sum they put in for that equity. The example looked at in detail in the book is how French corporate giant Danone provides daily yogurt cups which cost 6 euro cents (9 cents US) for the Bangladeshis.

Check this out for more:

http://www.youtube.com/watch?v=M_xlYHm_BEs

http://www.danonecommunities.com/?page_id=145

This will ensure that the poor and even those belonging to low income groups and not necessarily classified as the poor, can also have similar set ups working in their favour all over the world. This concept is spreading throughout many developing countries even as of now. So in the long term, the need for national currencies when such businesses are up and running will be for a limited period. Money given as aid and charity will be lessened as more of such social businesses take centre stage. And these businesses can also eventually, operate under the auspices of CCs and the new money, which leads to even less of a demand and strain in siphoning off national currencies to meet the needs of commerce, etc. The days of scarcity of national currencies will slowly become a thing of the past, and so will all the negative competition that this process engenders.

Money: the beginning of the end: synthesis (part 3)

2008-05-30T12:04:00.008+08:00

Money like you have never seen it

"Only when the last tree has died,
the last river has been poisoned,
the last fish has been caught will we realise that we cannot eat money."

-- 19th century Cree Indian saying

Here we will look at CCs briefly and in the context of what they are and how they operate according to the ideas of Bernard Lietaer, former senior Central Bank executive of Belgium and someone who has proposed a new money called the Terra. The ideas that follow will be based on and evolved from those of Lietaer’s. What will be proposed as a CC that can be used in conjunction with the Three Step Move, is a currency that I call the Indigo.

For some more info please watch:

http://www.youtube.com/watch?v=vjYDhuLWUnE

http://www.youtube.com/watch?v=uQehEGGwy0Q

Briefly, a CC is one that involves the use of private money or scrips as distinct from national currencies which are national legal tender. As Dr Gill Seyfang says in her important “Bartering for a Better Future? Community Currencies and Sustainable Consumption”, a CC “is the generic term for a wealth of alternative types of money which are springing up in communities throughout the world to address social, economic and environmental needs.”

Seyfang goes on to elaborate on three main types of CCs. These include Local Exchange Trading Schemes/Systems (LETS) which aim to “rebuild local economies through cashless exchange; Time Banks [that] promote volunteering, civic engagement and mutual self-help by rewarding unpaid work in the community; the…NU-card, a mainstream ‘green loyalty point’ currency piloted in the Netherlands which incentivises sustainable consumption.”

The focus here will be on the CCs which would fall under the LETS type of new money or what Lietaer would also classify as the Terra new money. According to Lietaer in his influential The Future of Money, there is a four-tiered monetary system for the future. People and businesses will routinely and comfortably deal in this multiple currency system, just as we today use all kinds of value cards, air miles, vouchers, credit and debit cards and virtual currencies in the course of our lives.

The first tier of this monetary structure would be a ‘global reference currency’, which is not linked to nation states as such. This currency, which is what the Terra is supposed to evolve into, is there to provide a steady reliable type of money that can be used for international trade. The Terra will be based on internationally traded items like gold, copper, and wheat. It appears that Lietaer believes that this kind of new world currency could morph into being from various corporate scrips used in cashless trade between businesses today.

Apparently, in the US, 400,000 businesses are linked to about 700 barter exchanges, which results in $8.5 billion in cashless trade. It seems that this kind of trade rips along at 15% a year, three times the speed of dollar commercial exchanges.

A second tier in this monetary structure would be, for example, certain multinational currencies utilized by what would be deemed as geopolitically-close countries. This could include say the NAFTA dollar, the Euro, and an ASEAN (the 10-member Association of Southeast Asian Nations) currency.

On the third level, we have some remaining national currencies which run within or outside the multinational currency regions. But this time, individual states no longer have the monopoly in issuance of currency.

At the fourth level, we have CCs/new money as has been discussed. To Lietaer, these CCs could have an expanded role and greater influence, as they may be widely used and exchanged through community internet clearing houses. The Terra, as it is envisaged now, would have evolved from this category. What we need to look at in some detail is what the Terra is and how this may affect its future as a world reference currency.

The Terra is a CC that would be issued by a nation’s central bank. As outlined by Lietaer in his seminal “A ‘Green’ Convertible Currency”, what we will have is a “commodity-based currency, [for ] a…New Currency backed by a basket of from three to a dozen different commodities for which there are existing international commodity markets. For instance, 100 New Currency could be worth 0.05 ounces of gold, plus 3 ounces of silver, plus 15 pounds of copper, plus 1 barrel of oil, plus 5 pounds of wool.”

This CC/new money is therefore backed by the valuation of the commodities in the basket at the value of the national currency of the society it originates from. So in the US, the value of the basket, in terms of USD, will determine the exchange rate between those trading in USD for the Terra in America.

Once again, we need to understand that the Terra works in tandem with the national currency and is not a new money that supplants everything else in its wake. As the Terra TRC (Trade Reference Currency) White Paper by Takashi Kiuchi, Chairman of The Future 500, states:

“The Terra is designed as a complementary currency operating in parallel with national currencies. Therefore, everything that exists today as monetary and financial products or practices continues to exist. The Terra mechanism is only one additional option available for those international economic actors who voluntarily choose to use it.”

Of course, this may advance into the more generic realm of the four tiered monetary structure put forward by Lietaer. So the Terra would be used as a complement in international trade alongside national currencies. The idea being to not only provide an alternative, but wean nations away from relying on conventional currencies which are fiat money subject to the swings of money markets and the designs of central banks and politicians.

But herein lies a problem. The nub of the issue is that the valuation of the Terra basket is done in the US, for e.g., in terms of USD. At this point, all hell may break loose due to the unreliability of fiat currencies. That is why the Three Step was proposed to overcome the problem of the Terra’s system of backing and help move it further onto the path of its contribution to the world.

Moving the Terra back to Firma

The trouble is how stable can the value of the Terra basket be when based on a valuation of what the source of the problem of our monetary system is: floating fiat currencies. Given the vagaries of the floating currency, anytime a disruption occurs, like the impending crisis coming for the USD as discussed earlier, the value of the Terra basket is going to be affected severely.

So I put this question to Lietaer himself and in a recent email (received only just as I was starting to write this piece), he says in effect that, yes, the components of the basket are quoted in whatever national money as they are today. But, however, the Terra instability I mentioned “is the one reflecting changes in value of those national moneys, not of the Terra. If there is a drop in value of the US$, that would simply mean that the Terra /in US$ /becomes more expensive. The real measure of value is the basket of the Terra itself...”

But it seems to me that it begs the issue of what is the value of the Terra, that is, it is measured in the national currency; but that currency is unstable due to its floating fiat nature and in the case of USD…potentially worse is yet to come. And it gives rise to another exchange rate problem of the falling currency of the USD, say, and the now ever more expensive Terra. This seems like it is back to Money as we still know it today.

Which is where gold comes in: once a national currency (e.g. USD) is on a fixed real value exchange to something truly stable and reliable like gold, the problem vanishes completely. Now we have a Terra basket valued solidly to commodities valued solidly to a currency fully backed by the value of gold. No more exchange rise and fall fiascos associated with fiat currencies.

This stable CC of the Terra then goes onto its next phase, which is the process of demurrage that comes in thanks to the genius of Silvio Gessel.

please watch

http://www.youtube.com/watch?v=hxdPIOUTd2k

The currency in true ecological fashion, has built in entropy that allows it to depreciate at the rate of say 10% a month, which means that if it is not used in 10 months time it will be worth nothing.

This is where the value of this type of CC becomes apparent as it forces the use of the currency in productive enterprises and not in hoarding or speculation of money markets. This inevitably leads to the kind of stimulus to productivity that standard Money can never equate. As seen in practice throughout history, the demurrage of this kind of new money or scrip leads to rapid growth and it does not place a strain on national currencies, nor create the harmful economic competition that national currencies foster. In fact, with a shift back to gold, the CC will truly be a complementary currency in every sense of the term as it comfortably complements the use of stable non-inflationary national Money guaranteed by gold.

The use of the Terra as shown in the Terra TRC White Paper involves a TRC Alliance that issues out the TRC to an oil company producing barrels of oil. The value of barrels of oil for sale is then translated into Terras through a currency conversion. The Terra is then used among those allied to the TRC network, as the demurrage takes effect. The demurrage takes place over the period of a year.

Indigos and Terra Firmas

With all this in place, I will look at a specific type of CC, the Indigo, that can be used within a LETS framework of a community and which is a parallel prototype of the Terra. This is the kind of currency that can be used before long and can evolve to the type envisioned in the form of the Terra (with the use of a commodities basket). The following way of creating the Indigo is an analogue of Terra creation adapted accordingly from the TRC White Paper.

Let us say we take a community of several municipalities or a province. This would provide a framework for a healthy dose of activity and business. These steps would follow in the creation of Indigos for a community of 50,000:

a. Let’s say the population of 50,000 has a median income of $24,000 a year (this national $ is backed by the new gold standard).

b. we take one-third the median income (as the rest of the income will be for other use, savings, insurance, etc) and multiply that by 50,000 so we get $8000 x 50,000 = $400 000 000

c. the basket of commodities for the Indigo includes the value of selected areas in townships like property value of public housing, areas of green spaces and/or agricultural land, community playgrounds, and healthcare centres. Choice of items and areas can be changed or rotated. So let us say that the value of this basket comes to $500 (figures chosen are for simplicity to get the calculation going).

d. we now have $400 000 000 divided by $500 = 800 000 Indigos

e. the Indigo has a 1:1 exchange with the $ (national currency). So this amount within a year is available from banks in the area. People buy them and this paper and virtual currency system (which will have a proper system of accounting) starts with its demurrage from the moment of purchase.

f. the rate of demurrage is 8.3% per month, which means that the Indigo will be worth almost zero right at the end of the time period of the year from its issuance. This would come to about 0.27% depreciation of the Indigo per day.

All national money used to purchase the Indigo goes to the community fund of the area/province it operates in. This fund will also keep the difference from Indigo cash-ins for national $. The cash-in difference earned by the community fund comes from factoring in the demurrage for cashed-in Indigos against $ reimbursements. At the end of the year, the community fund is recycled into community projects, etc.

So, anyone can cash-in on the Indigo at the bank at anytime for an equivalent $ exchange which would be less than initial purchase due to the demurrage. The difference from loss in $ value from the cash-in (thanks to demurrage) goes into a fund that various municipalities or communities will redistribute as funding for community projects. These recipients from the cash-in fund are designated each year by each local government (for e.g.). This is gleaned from the practice of demurrage used in certain north European townships where the cash-in ‘loss’ goes to various good causes.

What happens to Indigos cashed-in early? Well, they are up for sale to others. They are still bought at the 1:1 ratio with national $. So if the Indigos are reacquired say 6 months before their expiry, then the demurrage that kicks in will be twice the official one. That is because the money is not an infinite value store nor like the pyramid scheme expansion of current Money. That is one of the reasons for the demurrage, to eradicate pyramid schemes for money and an obsession in it as an end in itself.

So the reacquired Indigos with a shorter life span simply lead to more intense usage of the Indigo which is all the better in promoting growth. Also, if there are further cash-ins for reacquired Indigos then the cash-in difference goes back as usual to the community fund. People who acquire cashed-in indigos would be aware of this and would participate wholeheartedly in what is a community currency.

This process only emphasizes the natural and ecological nature of the Indigo and such CCs or new money. It is meant to decay and rejuvenate again when the next batch is issued for the following year based on renewed calculations for the Indigo currency basket. This is ecological money.

This reinvestment cycle from the use of the Indigo is a great way to improve community wealth. This in turn adds to societal growth. In the end, it is about the community, not the money per se. This in turn ensures that anyone buying and selling Indigos thinking they can ‘profit’ or make a ‘killing’ in exchanges with the $ are genuinely mistaken. They have to spend the new money or they will simply lose its monetary value. So when they realize this and cash-in, the difference from this goes back to the community, yet again. The purpose of the new money is always to promote growth, mutual trust and reciprocity, and more $ actually put back into the community.

This is a complete virtuous cycle meant to move forwards and upwards with communities gaining more and more each time. It is win-win in the best sense of the term. At an international level, the Indigo could transform into a firmer version of the Terra. Now we can have a Terra used by individual states backed not just by commodities, but by a nation’s value of national natural land areas, and high end human spaces. Cash-ins would be given to the state treasury for reinvestment into communities and/or national areas in need of assistance or development.

Or let us take it a step further. If the world’s nations have generally moved back to a gold standard, then a new world currency could develop backed by an international basket of swathes of the Amazon, arctic wildlife areas, world cultural icons, commodities like rice and wheat, solar and wind farms, etc. The basket would be measured in this case against the value of gold. So when this new world reference currency comes into play, called the Terra Firma, we actually finally have a stable world currency which can be cashed in any country because the equivalent in national $ will be given back with ease since everything is now measured in terms of stable gold value.

So a Terra Firma worth say 10 ounces in gold may be cashed in (after demurrage sets in), for the national currency in its country of use depending on that national currency’s gold value. The difference from the cash-in goes to a national fund of the country which reinvests into either needful areas in that country or split into reinvesting at an international level as well (that is, the reinvestment is handled by, for e.g., a new and reinvented UN backed International Monetary Fund). Since the basket involves world heritage areas and resources, a UN type body can supervise reinvestment into similar areas. This needs further clarification for as of now, international law is such that the natural green areas of the world, for e.g., would fall under the jurisdiction of the nation state it is in. In the end, the plan is for the world community to gain from this, and it reduces again competition for national currencies.

There will be a national CC fund from which countries participating in the Terra Firma Alliance will buy their new money from. The fund will also handle reimbursements and keep the difference from cash-ins. All the money earned here will be recycled into community/national community projects as designated by national government in consultation with some local governmental entities, at year end. Similarly at the international level, a UN body (IMF) would look to the reinvestment process from money earmarked for it from the relevant national CC funds.

One objection that tends to arise is would people start to rush to change national $ for Terras or Terra Firmas? Why would they when there would be a four tier world currency system and a whole host of CCs and new money all over the world among different communities to use? Terra Firmas are but the top layer of a multi-tier monetary environment. This decentralized use of money ensures we will relate to and use money in completely new and sophisticated ways different from the way it is used and viewed today.

What if people horde this new money and try to create shortages? Please go ahead and watch the demurrage eat away at your ‘golden hoard’. Again, there is such a choice for the new money in a multilayered monetary system which makes hoarding quite meaningless. There is the assumption, I must admit, that in the years ahead there will be a fundamental shift in human nature. And that shift would be complemented by CCs (proving its complementariness yet again) and that will ensure the growth, success and meaningfulness of the new money.

How it all hangs…

So, my friends, at the end of this experiment in ideas for CCs and new money, the Three Step move is of use because the crash of floating fiat currencies is in the works whether any of us like it or not. The USD, which some countries are rethinking as use as a reserve currency even as you read this, is going through the calm before the Great Debt Unraveling. When this happens, the natural recourse of nations, as has been done throughout the ages will be to return to the stable form of money that it has always used in such times: gold.

The advent of a new gold standard will see to a stabilization of the world monetary system. This will also allow for the flourishing of innovative forms of business like social businesses and CCs and the possible advent of the Terra. Examples of use of CCs linked to stable national money would be the Indigo, which can be fine tuned and improved by those better experienced in the operation of CCs. This in turn could lead to the Terra Firma, a real world reference currency.

These will be the first moves in serious decentralization of power from central governments, and to a more democratic participation of people in their communities and countries. Whichever way one wants to see this, it cannot but bode well for all of us in the long run by returning to what matters more than all the money in the word: human values.

Be well and happy.

three for the road

2008-05-29T12:45:00.002+08:00