Perry Anderson asked of the Left, during the end of the last century, that it accept what the eighties and nineties were about: the undeniable consolidation of neoliberalism. He spoke of this consolidation both economically and politically and pointed out more than once that, though history was far from over, certain present facts could not be ignored simply because it would (supposedly) make Uncle Karl upset.
I do wonder what the Right's main thinkers will ask of its political wing ten to twenty years from now. It's a question worth asking because orthodox economics is not without merit, and certainly did bring about some positive changes. The attempt at integrating the world economically that has been taking place since the nineties has undeniable benefits, such as an increase in the standard of living for certain sectors of Third World society, or the increase in globalized knowledge that we all have of each other, of one another's countries, cultures, and problems.
Globalization as it stands, however, the orthodox economics that have been put into play since the seventies, carried a danger that many only now begin to acknowledge. The danger of a major financial crisis was some thirty years in the making, clear as day, as entire economies became financialized, as the middle class in the developed world began to see its living standards decrease, as we saw the gap between rich and poor in the First World widen. The danger of leaving business people to regulate their affairs unchecked was apparent from day one, but, since Freedom was supposedly at risk, those who call the shots decided we should try it anyway.
So we get what we have now. First off, there's the inability to use a crisis (say, Enron) as a learning tool; instead, we use the unbridled faith we have in one of our many modern deities, Friedrich Von Hayek, to justify anything we want, from tickle-down economics and trillions of dollars in foreign adventures to making countries like Brazil veritable delivery services of quick and sexy financial returns, as illustrated by Leda Paulani. And yes, it is total faith in folks like Hayek or Milton Friedman, because proving that market forces do work, and that the ever-sexy Invisible Hand can masturbate anyone to eternal glory, is nigh impossible.
Except when you wish to prove that which you wish to see. The Left did this for years after the Second World War, building socialist economies like that of Britain and India without giving a flying fart for nuisances like inflation or people's wish to enterprise without having to file seven forms just to bang your next door colorful friendship. Folks like Friedman correctly predicted later on in the sixties that the kind of central planning you saw around the world (in some countries more than others) would lead to what came to be known as stagflation. They were on the money, and the parts of the Left that insisted that good intentions would eventually help during economic downturns were left at times with their dicks in their hands, looking dumbfounded.
But power, when first tasted, just tastes too damn good. It became common place, given the failures of central planning (and they were undeniable), to point to the bevy of millionaires popping up in the US and Britain during the eighties and say, "Look!, it works, Unfettered Free Enterprise works!!!" That living standards were falling, that growth in the economy was, in the best of times, artificial, that so much of the money that circulated in the markets was, to be honest, bullshit money; this was all irrelevant, for Grenada and the Falklands had been conquered, the Berlin Wall fell, and us Third World niggers were finally learning how to play the game.
And so here we are, October, 2008. The financial elite's reluctance to have its actions checked (and the willingness of many governments to simply look the other way for twenty-odd years) has taken it's toll: credit-based economies are tumbling and their populations are looking at the barrel of a gun as recessions with the potential for lasting some two years stare them in the eye. What's worse, we see governments like that of the United States shamelessly socializing losses, telling the taxpayer it is in their interest that the lenders be saved, but not the borrowers. It is also amusing to see so many telling themselves this is not socialism for the rich, that saving these banks and insurance companies is exactly what should be done, without considering that it would be economically and ethically interesting to perhaps bail out the taxpayer. And it's not like this crisis is a complete surprise, since there have been economists warning against that which we see happening right now.
This is perhaps the part where it is valid to note that the Right and the Left (or parts of them, anyway) share some similar goals: both exalt freedom; both seem to search for ways to better the world in which we live. The Right espouses that this will come about through economic freedom, and the Left seems to believe social justice will do the job (it is even argued by some, including noted Brazilian economist Luis Carlos Bresser Pereira, that Socialism was not so much a mode of production as it was a system for theorizing the concept of Social Justice). And it is fair to note that, since 1945, both sides of the spectrum have had the opportunity to practice what they preach, sometimes with brilliant results on both ends. What is depressing about what we see right now is that the current discussion keeps concentrating, on the part of the Left, on how we can't leave the economy to greedy whores on Wall Street, and on the part of the Right... well, the Right isn't saying much right now.
I don't doubt that giving a den of unhumanity such as Wall Street complete control over the economy is a bad idea: going unchecked, people are obviously going to do exactly as they please, without fear of consequence; at most, a few scapegoats, guilty or not, go to jail and a few companies go under, but the structure stays the same, and the freedom to fool yourself as well as your customer (the very definition of ninja loans) goes unchallenged. We had this behavior in centrally planned economies, and it was assumed by government technocrats that no one was more suited to run the general populace's affair than government technocrats. Needless to say, these economies were the same dens of senseless greed that we see on Wall Street. In many cases, though, after shunning the centrally planned state, all we did was move from State Communism to Corporate Communism; we changed the word public to private and called it a day.
Perhaps the conversation should now focus on two fronts. First, it might be safe to assume we've seen enough of both sides of the political economy pendulum since the late nineteenth century, so that we may finally focus on a formula that uses both State and Private tools to help us achieve a more desirable society. Secondly -and, I believe, more importantly- it is time to discuss, really discuss, Power. It is high time we realize that the difference between giving people's houses to private firms that are allowed to freely cook their books, and giving it to government officials that inflate bureaucracy so as to be above the law, is exactly the same thing. Actually, if we are to be honest, we can quickly realize countries like the Soviet Union were capitalist, that all they did was take the economy and give it to gentlemen in KGB uniforms instead of gentlemen in Armani wear that write successful self-help books. The KGB privately owned the USSR; its member had business which they ran -supposedly for the State, but, in actuality, for themselves. The difference between these gentlemen and the heads of AIG, Lehman Brothers, and so many other institutions that are going under, was one of terminology and semantics. More importantly, they answered and answer to no one, and, in the American case, it would seem that some of these apparatchiks are walking away with bonuses after having run their companies under.
If we do not begin discussing the power relationships that society's most important institutions have with its citizens, we're doomed to a new financial fiasco such as the present one in another generation or so. If we're going to build, by Left or Right, a world that's even remotely admirable, we have to be sure that we are honest about what can and cannot be done through the institutions we build for ourselves. Corruption, in the long run, State- or Corporate-run, is too much of a burden for any society to handle (just look at Brazil: we keep missing every historical opportunity under the sun because our elite can't stand to lose an inch of its power). And this burden can only grow heavier if the society we envision for ourselves is to have smaller and ever more artificial borders, if we are to truly live in some global way.
I do wonder what the Right's main thinkers will ask of its political wing ten to twenty years from now. It's a question worth asking because orthodox economics is not without merit, and certainly did bring about some positive changes. The attempt at integrating the world economically that has been taking place since the nineties has undeniable benefits, such as an increase in the standard of living for certain sectors of Third World society, or the increase in globalized knowledge that we all have of each other, of one another's countries, cultures, and problems.
Globalization as it stands, however, the orthodox economics that have been put into play since the seventies, carried a danger that many only now begin to acknowledge. The danger of a major financial crisis was some thirty years in the making, clear as day, as entire economies became financialized, as the middle class in the developed world began to see its living standards decrease, as we saw the gap between rich and poor in the First World widen. The danger of leaving business people to regulate their affairs unchecked was apparent from day one, but, since Freedom was supposedly at risk, those who call the shots decided we should try it anyway.
So we get what we have now. First off, there's the inability to use a crisis (say, Enron) as a learning tool; instead, we use the unbridled faith we have in one of our many modern deities, Friedrich Von Hayek, to justify anything we want, from tickle-down economics and trillions of dollars in foreign adventures to making countries like Brazil veritable delivery services of quick and sexy financial returns, as illustrated by Leda Paulani. And yes, it is total faith in folks like Hayek or Milton Friedman, because proving that market forces do work, and that the ever-sexy Invisible Hand can masturbate anyone to eternal glory, is nigh impossible.
Except when you wish to prove that which you wish to see. The Left did this for years after the Second World War, building socialist economies like that of Britain and India without giving a flying fart for nuisances like inflation or people's wish to enterprise without having to file seven forms just to bang your next door colorful friendship. Folks like Friedman correctly predicted later on in the sixties that the kind of central planning you saw around the world (in some countries more than others) would lead to what came to be known as stagflation. They were on the money, and the parts of the Left that insisted that good intentions would eventually help during economic downturns were left at times with their dicks in their hands, looking dumbfounded.
But power, when first tasted, just tastes too damn good. It became common place, given the failures of central planning (and they were undeniable), to point to the bevy of millionaires popping up in the US and Britain during the eighties and say, "Look!, it works, Unfettered Free Enterprise works!!!" That living standards were falling, that growth in the economy was, in the best of times, artificial, that so much of the money that circulated in the markets was, to be honest, bullshit money; this was all irrelevant, for Grenada and the Falklands had been conquered, the Berlin Wall fell, and us Third World niggers were finally learning how to play the game.
And so here we are, October, 2008. The financial elite's reluctance to have its actions checked (and the willingness of many governments to simply look the other way for twenty-odd years) has taken it's toll: credit-based economies are tumbling and their populations are looking at the barrel of a gun as recessions with the potential for lasting some two years stare them in the eye. What's worse, we see governments like that of the United States shamelessly socializing losses, telling the taxpayer it is in their interest that the lenders be saved, but not the borrowers. It is also amusing to see so many telling themselves this is not socialism for the rich, that saving these banks and insurance companies is exactly what should be done, without considering that it would be economically and ethically interesting to perhaps bail out the taxpayer. And it's not like this crisis is a complete surprise, since there have been economists warning against that which we see happening right now.
This is perhaps the part where it is valid to note that the Right and the Left (or parts of them, anyway) share some similar goals: both exalt freedom; both seem to search for ways to better the world in which we live. The Right espouses that this will come about through economic freedom, and the Left seems to believe social justice will do the job (it is even argued by some, including noted Brazilian economist Luis Carlos Bresser Pereira, that Socialism was not so much a mode of production as it was a system for theorizing the concept of Social Justice). And it is fair to note that, since 1945, both sides of the spectrum have had the opportunity to practice what they preach, sometimes with brilliant results on both ends. What is depressing about what we see right now is that the current discussion keeps concentrating, on the part of the Left, on how we can't leave the economy to greedy whores on Wall Street, and on the part of the Right... well, the Right isn't saying much right now.
I don't doubt that giving a den of unhumanity such as Wall Street complete control over the economy is a bad idea: going unchecked, people are obviously going to do exactly as they please, without fear of consequence; at most, a few scapegoats, guilty or not, go to jail and a few companies go under, but the structure stays the same, and the freedom to fool yourself as well as your customer (the very definition of ninja loans) goes unchallenged. We had this behavior in centrally planned economies, and it was assumed by government technocrats that no one was more suited to run the general populace's affair than government technocrats. Needless to say, these economies were the same dens of senseless greed that we see on Wall Street. In many cases, though, after shunning the centrally planned state, all we did was move from State Communism to Corporate Communism; we changed the word public to private and called it a day.
Perhaps the conversation should now focus on two fronts. First, it might be safe to assume we've seen enough of both sides of the political economy pendulum since the late nineteenth century, so that we may finally focus on a formula that uses both State and Private tools to help us achieve a more desirable society. Secondly -and, I believe, more importantly- it is time to discuss, really discuss, Power. It is high time we realize that the difference between giving people's houses to private firms that are allowed to freely cook their books, and giving it to government officials that inflate bureaucracy so as to be above the law, is exactly the same thing. Actually, if we are to be honest, we can quickly realize countries like the Soviet Union were capitalist, that all they did was take the economy and give it to gentlemen in KGB uniforms instead of gentlemen in Armani wear that write successful self-help books. The KGB privately owned the USSR; its member had business which they ran -supposedly for the State, but, in actuality, for themselves. The difference between these gentlemen and the heads of AIG, Lehman Brothers, and so many other institutions that are going under, was one of terminology and semantics. More importantly, they answered and answer to no one, and, in the American case, it would seem that some of these apparatchiks are walking away with bonuses after having run their companies under.
If we do not begin discussing the power relationships that society's most important institutions have with its citizens, we're doomed to a new financial fiasco such as the present one in another generation or so. If we're going to build, by Left or Right, a world that's even remotely admirable, we have to be sure that we are honest about what can and cannot be done through the institutions we build for ourselves. Corruption, in the long run, State- or Corporate-run, is too much of a burden for any society to handle (just look at Brazil: we keep missing every historical opportunity under the sun because our elite can't stand to lose an inch of its power). And this burden can only grow heavier if the society we envision for ourselves is to have smaller and ever more artificial borders, if we are to truly live in some global way.
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