One of my pleasures over the holiday period has been reading The Baffler‘s third book-length collection of articles, No Future For You. (I read the first one, Commodify Your Dissent in the early 2000s, but missed the second one.) For those new to The Baffler: it is a radical American magazine, published three times a year, that has mostly been going since 1988. The list of authors in this latest collection is impressive, from Baffler founder Thomas Frank to Susan Faludi, Evgeny Morozov, Rick Perlstein, Barbara Ehrenreich, and David Graeber. The collection of subjects ranges wide across the sociopathies of our late Potemkin-capitalism, from gentrification to LinkedIn, to Vice, NewsCorp and the Washington Post, to Sheryl Sandberg and the Waltons, to Fifty Shades of Grey and Prometheus to all of the President’s biographers. I bought the book to have a print copy of David Graeber’s magisterial essay “Of Flying Cars And The Declining Rate of Profit” on the failure of innovation in the digital age.
If there is a theme that binds these different authors and their disparate subjects, it is that The Baffler has a sharp eye for hucksters and hucksterism. And more: that in our present era of late capitalism, with its “morbid symptoms” manifested by a failed order desperately trying to keep itself and its privileges afloat, hucksterism is the latest, or last, symptom of therentier economy.
“The most annoying thing about most of the commentary on the European elections is that it is dominated (as usual) by people who are only interested in elections, and entirely uninterested in what is actually going on”, John Naughton observed in an excellent post this week. Actually, that splits into two, reinforcing problems. Politicians are too interested in people who vote, and not those who don’t, and the media is too interested in events, and not sufficiently interested in causes. As a result, you get lots of heat and precious little light.
And it’s pretty clear that what we saw last week was one of the continuing shock waves rolling out from the financial crisis, a crisis that almost certainly has another decade or so to go.
There’s a moment in this interview with Paul Krugman about Thomas Piketty’s book Capital In The 21st Century where Bill Moyers asks Krugman this question:
Moyers: Do you agree with [Piketty] that we’re drifting towards oligarchy?
And Krugman gives him this reply:
Krugman: Oh yes. There’s no question of that.
And watching it I realised that the next political phase of the campaign started by Occupy is now starting to emerge.
Here’s an extract about the country’s economic prospects:
“While the last three decades tell us that it’s unwise to bet against China fixing its problems, there are some big questions.
“One is about the effectiveness of the transition to a consumer economy, which needs significant institutional change if it is to work. This leads to a second question, of whether China’s market institutions are robust enough and trusted enough to support such a transition; this is almost certainly one factor behind the country’s anti-corruption drive. An important issue in this is openness: despite its huge internal market there will be doubts about how effectively China can modernize or innovate while it shuts off its internet from the world. The cost of managing its “Golden Shield” is said to be $1.6 billion to date.
“A third question is about the cost of unwinding or writing off stranded assets, whether they are ghost cities or the government’s cotton mountain, bought at prices well about the world market. There are also questions about the overall levels of Chinese debt, and whether a combination of asset bubbles, shadow finance, and bad debts throughout the country’s banking system could prompt a financial crisis. Finally, there are signs that the “Chimerica” system, under which Chinese savings bought American debt, and Americans then bought Chinese goods, is coming to an end.
“As Robert Gottliebsen argued recently in Australia’s Business Spectator:
China does not want to fund further US deficits and the US wants to reduce its deficits. And so the US-China model that has dominated the world is changing and Chinese consumers must be stimulated to replace the Americans. … The Chinese leadership understands this but changing the model will not be easy, particularly as the population is ageing. Japan tried a similar switch and failed.”
The image at the top of this post is from Wikimedia, and is used here, with thanks, under a Creative Commons licence.
A few years ago I wrote a set of scenarios – with Joe Ballantyne and Andy Sumner – on the prospects for the world economy to the early 2020s. In one of the scenarios we saw the “West” regenerate itself by a combination of public investment and by bringing home its high value manufacturing. After I’d drafted this post, David Cameron popped up at Davos to promote the idea of “re-shoring”, even if he seems less keen on the notion of public investment. And according to a recent report in The Conversation by some Birmingham University researchers, there are signs that re-shoring is starting to happen, that British businesses are bringing it back home.
So, by way of a thought experiment: what if London is about to peak? The reason would be the way housing provision and housing regulation had destroyed the economic balance of the city, and there are some serious warning signs. Recently, there’s also been a wave of commentary on this. But first, let’s just roll back to the ’70s.
Britain’s high speed train project, HS2, is something of an enigma wrapped in a mystery. The projected costs are spiralling, currently at £50bln and counting; the line antagonises voters in every constituency it is planned to run through, and could cost the government seats in the next election; and pretty much every credible transport expert says that if you’re going to spend that much money on rail infrastructure you’re better linking regions together rather than creating a faster funnel into London. And yet the project stays afloat, buoyed up, it seems, by the claims of its supporters. (more…)
I spotted this in a review by the critic Terry Eagleton:
Bertolt Brecht tells the tale of a king in the East who was pained by all the suffering in the world. So he called his wise men together and asked them to inquire into its cause. The wise men duly looked into the matter, and returned with the news that the cause of the world’s suffering was the king.
I’m indebted to a letter in The Guardian for this account by J K Galbraith of the history of the American economy between 1929′ the year of the Crash, and 1932, the last year of the Hoover administration:
“Gradually interest rates were brought down. The rate at which banks could borrow was 1.5%, hardly a usurious charge. Bonds were bought on a considerable scale and the resultant cash went out to the banks. Soon the banks were flush with lendable funds.
“All that remained was for customers to come to the banks. Now came a terrible discovery. The customers wouldn’t come. Even at the lowest rate they didn’t think they could make money. And the banks wouldn’t lend to those who were so foolish as to believe that they could.”
And people say that history never repeats itself.
The image is a 1932 cartoon mocking Hoover for asserting that prosperity was just around the corner. It is from the Princeton Alumni Weekly, and is used with thanks.
Mrs Thatcher’s only been in Hell for 30 minutes, and already she’s closed three of the furnaces and another three are on strike.
It wasn’t on Twitter, or on a political blog, but on the listserv of some football fans – fans, as it happens, of a club in a former mining area in the north of England. As Hugo Young said in his posthumously published piece on her (he died in 2003) in Tuesday’s Guardian, “Thatcher was a naturally, perhaps incurably, divisive figure.”
For my part, I think you need only one chart to understand her influence on Britain, which shows the step-change in inequality during her time in power. I’ve published this here before, when I blogged on the 30th anniversary of her first election victory: