Friday, February 27, 2009

पोस्ट कैपितालिस्म a

POST CAPITALISM AND THE SHAPE OF THE ANGST TO COME.

John Locke, 1689: “God gave the World to Men in Common; but since he gave it to them for the benefit, and the greatest conveniences of life they were capable to draw from it, it cannot be supposed he meant it should always remain common and uncultivated. He gave it to the use of the Industrious and Rational (and Labour was to be his Title to it); not to the Fancy or Covetousness of the Quarrelsome and Contentious.”


Locke’s eloquence notwithstanding, the foregoing is but a sententious justification of the greed that justified man’s inhumanity to man and his criminal neglect of the environment
that gave us so much and finally landed us in the unpredicted mess whose deleterious
impact is as destructive as any world war. It is an example of the artificial logic that made crass capitalism, and an un Christianly individualism acceptable to an otherwise reasonable humanity. It ushered in quite smoothly the desacralization of much of human
pursuit including knowledge. And man began to worship at the alter of materialism as he became over impressed by his own creations.


On cat feet, in crept the very worst of times. It came rather like a thief in the night, unheralded, unpredicted, and unexpected; never before had the world seen the loss of so much so quickly, nor seen such world wide loss of confidence set about by crises so comprehensive and confounding that few are able to be objective in the face of it. Countries that had paid so much lip service to Market Forces and Globalism began to falter in their ranks; and rancor and dissent overtook them. The European Union which had taken all of forty five years to knock together, began to fall apart in a few weeks of collapsing markets, imploding automobile industries and the first whiff of a recession.


The spectre of Protectionism once again threatens to rent asunder the house that Free Enterprise built.


In spite of the Obama phenomenon, (have greater expectations by so many ever before
been placed upon the shoulders of one man?), and the promise of solutions to the ailments that presently plague the world, this summer promises to be a particularly gory one as the riots and near anarchy that exploded in Greece reverberates throughout Europe. The rest of us will get a chance to observe the ogre that exists just beneath the veneer of the “well mannered”, “even tempered”, civilized European; much like the one beneath the veneer of us all. It will be the summer of riots, violence, suicides, strikes, plummeting oil and gas prices, even the English will be hard put to disguise regicidal tendencies. The rest of us will not be spared: Globalism will come home to roost with exacting and grim vengeance.


The autumn that follows the Summer of Anger of 2009 will usher in a post capitalist, post existentialist, post socialist, world; an alien world of the New Angst. Brows will furrow; some from fear, others from thought, for many it will be from confusion but they will all be The many faces of The New Angst. And as Angst sets in and confidence in Western panaceas begin to erode, protectionism, regionalism, parochialism and xenophobia will set in. The recent and destructive declaration of “British jobs for the British” is exactly the kind of cant that can tip us over into dark times.



In The Trouble With Interest Tarek El Diwany suggests that…“in order to meet the high real rates of interest occasionally thrust upon it, enterprise tends to increase the rate of resource extracting by boosting the productivity of physical capital. It might be argued that, in the twentieth century, advances in technology have presented this solution to developed societies on a plate, but technological advance may delay the day of reckoning. However long this delay proves to be, and it may be a very long delay indeed, (our) earlier argument foretells the dire consequences that productivity can have on the entropic Earth-bound system. Polluted river, festering rubbish tips and resource-depleted seas may be just the first installment of the price that is paid.”


El Diwani was talking specifically about the futility of humans, or capitalists, entering into a race with compound interest. Nevertheless, his prediction, published, in 1997, well before the economic crisis threatening to engulf the whole world, speaks eloquently to us, not only about the Compound Interest Predicament, but also about The Crisis.
The trouble with Capitalism is that it has been so utterly successful: in enslaving human
Enterprise. Consequently, it has ushered in a new Dynamic in the Free Market equation (The Asian Equation?).



It must be recalled that there was a time when “World Markets” referred to a dynamic that was essentially a “continued (western) postcolonial primacy of relationships of the colonial era”. The dynamic upheld the supremacy of all that was good in Adam Smith and all relativist interpretations of the Invisible Hand, that ensured that fundamental Christian morals and ethics, were not to be seen to be subverted by the baser inclinations of man in his pursuit of free market enterprise; inclinations that were to lead to the child labour that Charles Dickens was reacting to when he created his memorable cast of characters in Oliver Twist, and caused Max and Engels to write The Manifesto. These inclinations also gave us the modern slavery that blighted Africa . These (un)subverted inclinations, therefore, meant that The Gospel of Free Market Enterprise appeared to promise the Greatest Good for the greatest number. The problem, however, was the unstated fact that the greatest number referred to, was primarily, the greatest number of the privileged in the West. The truism that one gained at the expense of another was conveniently consigned to apocrypha.



Free Market Enterprise gave rise to many offsprings, one prodigal was Laisse Faire, which became so autocratic a monopolist that governments had to step in to protect hapless citizens from the ogre; another offspring was Reagan’s Supply Side Economics that was predicated on the deficit spending that actually insidiously sowed the seeds of the cataclysmic financial implosion we are witnessing today. That implosion heralds the end of the global market, as we hitherto knew it to be. It is a catastrophe; but it is a Western catastrophe, which for the rest of us is a historic interlude of momentous opportunity. It has to be restated that while Western nations slide into a predictable and predicted recession, to the rest of us this is simply a glitch along the way as we emerge into productivity and greater relevance amongst the comity of nations.



As the virus of recession spreads through out the world, we will observe that some of the most fragile emerging markets may remain somewhat inured to it. Asia is contending
with dampened growth expectations, not recession. China ’s growth is expected to slow, as many as four points, down to eight from twelve percent. Almost all Western nations, by contrast are experiencing negative growth. The Middle Eastern counties have enough Petrodollars to float through the crises. Intra-trade within ASEAN (Alignment of South East Asian Nations) countries will ensure the continued demand for oil and gas that will aid their relentless march to modernity.


Even five percent growth rate in England , Germany , or the US , would’ve been heralded as roaring growth. What is wrong with this picture then? Everything, if you happen to come from any of these countries who have for long trumpeted the virtues of free enterprise without realizing that when the rest of the world awakes to the need to engage in the market space, it would indeed herald the dawn of a new, more dynamic world which would not accept that “some animals are more equal than others”, or, at least, that animals other they, are more equal than others! It would be an era in which the hitherto powerful and privileged would share Capital Space or Market Space with the rest of the emerging (productive) nations.


This would mean a REDUCTION for the West and a GAIN of Capital or Market Space for the rest. This as difficult to adjust to as it was to adjust to the loss of space whether in schools, in the electorate, in the market place or in the political space, as women, (and blacks in the US ) for instance demanded more.



The emergence of so many unto the global stage of relevance ushers in multilaterality that must necessarily mean the end of Capitalism as we know it and the dawn of Neo or Post Capitalism. The financial tumult unfolding presently should be seen as birth pangs that bring forth something new. And for the survival of all we must adopt new strategies that are predicated on the very opposite of what brought us thus far and that is a Non Zero Sum Policy. What is Non Zero Sum? It is a dynamic that jettisons confrontation in favour of Consensus and even conviviality. It is about multilaterality. It is not about Communications Minister, The Honourable, David Mark, in the 1980s, who, mimicking the Indian Communication Minister, C.M. Stephen, who “declared in Parliament in the 1970s that telephones were not a luxury, not a right, and that any Indian (Nigerian) who was not satisfied with his telephone service could return his phone-since there was an eight year waiting list of people seeking this supposedly inadequate product” (culled from Kishore Mahbubani’s The New Asian Hemisphere). It is certainly about celebrating and encouraging a situation where increased teledensity has exploded capacity in the job/entrepreneurial sector. Instead of a winner takes all situation, we can adopt win win strategies that move everybody along. This is already happening amongst the many that capitalists have adopted philanthropy as a New Age religion. We now urge that hitherto secular states consider this option in the formulation of their strategies and policies.



Basil Davidson, in the Black Man’s Burden, says, “Colonial frontiers had been carved through ancient zones of regional trade and men had naturally found ways of evading their obstruction.” The problem facing humankind today is that we are presently at the extremes of a world pecking and “ancient zones of regional trade” order which has foundations and an architectonic based on lines of military conquest. However, as Mutually Assured Destruction reduces Ancient/traditional conflicts, first with Low Intensity Conflict (LIC) and then with Industrial/economic/ warfare and ideological/religious warfare, we find conquerors of ancient times reacting in the face of the dawn of a new post industrial era in which an altogether different dynamic is at play.



The world over, populations that had previously struggled haplessly with Peasantry and Poverty, are coming into the empowering strata of the middle class and in doing so, are competitively vying for more capital (physical and financial), more goods, and a greater socio-economic space which apparently is not limitless- The Challenge of this New Age is how to expand the socio-economic space, Globally, to accommodate the newer, younger and more vibrant peoples around the, hitherto, deprived corners of the world.


To some degree, at present, the short-term solution is for the mega-rich, the Oligarchs, to yield some socio-economic space so that the rest may wrest some comfort for themselves, but this is a short term solution at the best.


Henry Ford created a modern economic revolution when he built the Model T Ford. He a chieved various things simultaneously, e.g. Division of labour; which made mass employment possible, and therefore masses’ migration from rural to urban centres became the demographic portrait of industrialization; mass transportation, the steel industry, labour unions, and consequently unionism; the urban centre as The Concrete Jungle, all became immediately possible with the energies released by the Division of labour and the automobile.



The liberation of the individual as he experienced an unprecedented and unbelievable dominion over time and space, unshackled the imagination and made space travel and exploration possible. There followed a proliferation of goods and services and the multiplication of providers and the consumers for these goods and services. The net result was the quick and impressive expansion of the socio-economic space. So that by the 1920s, Americans especially could sing it that the good times “are here again”. Those were the roaring twenties.



With the demystification of the processes of production, the magical impact of the novel automobile has begun to wane. With robotics, the ubiquity of production centers, automobile production can no longer have the incredible impact it once did on the socio-economic space.

The world that Ford built is imploding. And Ground Zero for the implosion that is occurring is the US .



It is against this background that, with the improbable name of Obama, the implausible cause of Real Change, and the impossible dream of attaining the Presidency of the United States of America, that one man came upon the world stage with a mandate to bring change to the US and indeed, by implication, the rest of the world.


The task will be onerous for him, as for us; as we attempt to chart the course of this NEO CAPITALIST world.



OPIUM WARS CONTUA

Man has laboured prodigiously to overcome an overwhelming limitedness; his ignorance and his fears, and has done much to uplift himself to better befit this awesome earth which has remained his sole dwelling place and his most humbling inheritance.

Much profit has come from such keen and earnest labouring. Impressive cultures, cities, and market places have been constructed. And the means of producing goods and services that it pleases man to consume have been improved to levels that must be nearing perfection; so much so that cities can be erected, in no time at all, in places formerly considered inaccessible and unfit for human dwelling.

The dictum that there is dignity in labour first became a mantra, then dogma and then it became the opiate of the masses that captivated and held captive man in such productive thralldom that man has now come to a happy, and what really should have been an easily predictable end: The Age Of The Glut.

We are presently living in a time when the all the walls of modern citadels; market places and all places of financial hocus pocus are tumbling down with apocalyptic haste. It is an implosion in every sense but it is also a deflation occurring with the rapidity that befits our jet age.

All the materiel of Middle Class existence are now so well and so quickly made that the traditional means by which Westerners, formerly such invincible Masters of The Universe that they succeeded in achieving a first; the Industry of enslaving and domesticating his fellow man. This they managed at commercial volumes so great that only the management skills of the Nazis as they shepherded Jews to death in their implementation of The Final Solution of the Nazis has bested it.

So much earnest industry has created a glut of products that very soon it will be cheaper to give goods away than to attempt to sell them, or to recycle them than to warehouse them. Germany , for instance, is in the process of taking old vehicles and paying for this with new vehicles. The old, working vehicles are scrapped. It doesn’t take a leap of imagination to realize that in the coming era of potential protectionism, and unprecedented levels of unemployment, it would pay, not only the German government, to put people to work by producing matériel for the public(military )sector, where we may not so easily have a products glut.
The Glut has wreaked much havoc already. The first was the destruction of the process by which value was ascribed to things. The process by which we bought our way, first into the bourgeoisie and then into that exclusive and mythical class of the elites. Chinaware, for instance, was enjoyed only by Royalty, and a few very privileged persons. But today the once esoteric art of firing porcelain is so exoteric that almost every working class family the world over boasts of China Tea Sets and serving plates of very fine quality; ditto with Silverware. Ditto with exclusive luxury goods were those a mythical gap between expensive goods and their cheap or “clone” counterparts. The Asian producers have wiped out that gap because the so-called clones are so well made mainly because they are made by the same producers who make the unaffordable items. Why, many wonder, pay, say $100US for a YSL shirt, when you can pay $10US for a TSL shirt, or even a YSL shirt that looks and feels the same as the $100US item? We have the same dilemma with cars, micro wave oven and even homes.

Before this begins to seem like an enumeration of trivia, I wish to mention Generic Drugs and the fact that having demystified and proliferated the means of production, knowledge has become similarly demystified and access points likewise proliferated to a point where it becomes considerably cheaper to preserve lives with the production of so called generic drugs that are a much as 90% cheaper.

It must be said that our Masters Of the Universe, who once solely held the reins of production are not particularly over the moon about this pass that we’ve come to. As they challenged South Africa’s bid to procure affordable Retroviral drugs so that her poor and hapless citizens may survive, they will challenge China’s right to come to the market place with all manner of generics and India’s right to access intellectual property and offer outsourcing services that are channeled without due consideration for political propriety.

Deng Xiaoping bequeathed to his people his famous twenty eight -characters and it is moot here to excerpt numbers 1 to 7: culled from K. Mahbubani, The New Asian Hemisphere, (1) lengjing guacha- observe and analyze (developments) calmly; (2) chenzhuo yingfu- deal [with changes] patiently and confidently; (3) Wenzhou Zhen Jiao- secure [our own] position; (4) taoguang yanghui-conceal [our] capabilities and avoid the limelight; (5)shanyu touchuo- be good at keeping a low profile; (6) juebu dangtou - never become a leader; (7) yousuo zuowei-strive to make achievements. As the world laments the credit crunch as though some form of metaphysical black whole has swallowed all our money, let us remember that less than a year ago China announced to the world that it has crossed the 1 trillion dollar mark in its foreign reserves. The operative term here is: “crossed”. The Chinese are a race so utterly and inscrutably conservative, as can be seen from the above, that “crossed” is crucial to better appreciate that the world’s cash has simply moved to China .

This would not be the first time a deficit of this nature in trade with China is occurring. In the early 1800s the English had become so addicted to tea and found much to their growing consternation that the Emperor would accept none other payment for the much needed tea and silk, than silver bullion that so much silver was transferred to the Emperor that The Bank of England suffered a complete and crippling loss of silver bullion. Whereas the loss led to an increase in the value of, and demand for, silver; it was with dismay that the English noted that even though Chinese women used a little silver as trinkets, the rest was simply a hoard over which the men, or Emperor simply gloated!

It took the Opium Wars to redeem this intolerable state of trade relations. With the subsequent stupefaction of a generation of Chinese, the bullion was returned to the its proper home, for the good of all Christians, all those soon to be Christians, and all those yet to become so saved by The Good News. And for a hundred years Hong Kong became a British fiefdom and an excellent Christianizing market for a lucky few.
And for anyone who might think that the British have ever needed other than pecuniary reasons for attacking a foreign country, or that the invasion of Iraq is a rare departure from noble norm; here are the words of Thomas Arnold to W.W. Hull, on 18th March 1840, a conscientious objector to the first Opium War, waged by the British against China for criminal reasons:

“This war with China … really seems so wicked as to be a national sin of the greatest possible magnitude… I really don’t remember, in any history, of a war undertaken with such combined injustice and baseness. Ordinary wars of conquest are…far less wicked, than to go to war in order to maintain smuggling, and that smuggling consisting in the introduction of a demoralizing drug, which the government of China wants to keep out, and which we, for the lucre of gain, want to introduce by force; and in this quarrel are going to burn and to slay in the pride of our supposed superiority.”


Much of the Chinese Trillions will come to Africa in a hurry- before the second scramble for Africa begins. The question we have to ask ourselves is, the nature of the relationship we wish to have with the ASEAN TIGER. I propose that before mortgage our lives and those of our progeny to the highest bidder, we should consider that in this era of high unemployment we would do better to negotiate for infrastructural developments and transfer of technology, than cash payments. They can afford the payments but they would give a premium to put their people to work in Africa ; that is to say that where we were meant to get X value for our raw materials, for instance, we could XYZ if we negotiated for Development rather than Payment. Especially because we are giving or selling both our raw materials and employment to their millions.

The problem, of cause, with cash payments, is that it’s a two-step tango to disaster; first you get paid and then you turn the money right around and purchase goods and services; the money therefore goes right back whence it came. With payment in infrastructural development and transfer of technology, however, you develop capacity and then turn around and sell goods and services. In the process of this non- pecuniary payment, value is added, and since value gained is already far and above the pecuniary value that would have been paid in the first place, there’s a compounding of the quantum of value received. Additionally, our politicians would have far less success stealing capital assets, than the moneys that they find it impossible to keep them hands off, its difficult to stash a fly-over in your drive-way however grandiose.

We really should enact laws in Africa that compel our leaders to accept approximately 30% payments in financial instruments and the remainder in asset/infrastructural development and transfer of technology.

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