fpb: (Athena of Pireus)
From now I shall use a new word. The kind of people who argue against a minimum wage are neither conservative (how DARE they?) nor libertarian. They are starvationists. Remember the word: STARVATIONISTS.
fpb: (Default)
For at least thirty years, most Western countries - Italy least of all, because capitals shortage has long been a national problem - have effectively been transferring the power to decide and direct public policy to what are commonly called "the markets". These "markets" have grown enormously in capitalization and in autonomy. Even the authorities that controlled them - the Stock Exchanges of New York, London, Frankfurt, etc - have been largely privatized and frequently been objects of mutual takeover efforts. Whether or not these were successful, they were the public evidence that the public power - the state - did not wish to have any role of control or even of supervision over these boiling, rabid oceans of ill-controlled money.

The reason Greek philosophers, and their successors until the Enlightenment and beyond, treated democracy with nervousness if not with contempt is that they dreaded mob rule. Ancient democracy, such as prevailed in Athens, was based on the assembly of free citizens, and was constantly in danger - unless managed by a strong and respected politician such as Pericles - of reverting to mob rule. And in mob rule, the philosophers dreaded not so much the element we think of most easily - the unleashed violence of the mob, street murders in revolutionary Paris or lynchings in the old South - but its fecklessness, its inability to settle on any goal and achieve it, its being, politically speaking, quicksand. Mob rule means the lack of any sense of public direction, of any boldness or moral authority, and of any ability to say yes or no.

Well, the unrestricted power of the markets is mob rule, and mob rule with a terrible refinement - it is ultimately not human. A mob made of human beings is at least susceptible to human influences; classical accounts are full of crazed mobs brought to their senses by some respected individual, an Aristides or a Memenius. And that is not only a matter of ancient legends: we have seen, in our lifetimes, an instance of the most terrible of all mobs - an armed mob of soldiers - stopped in their track by the moral authority of three people. But the current "markets" are a cyber-mob, trained to mindlessly follow the buy or sell orders automatically issued by their number-crunching machines - like the damned sheeple in Dante, who, having never shown any personality of their own at all, were condemned to pursue for all eternity a meaningless rotting rag instead of a flag.

Now we have come to the last pinch of the vise. Having devoured all sense of public authority, having insulated themselves against any kind of control, having, indeed, grown by means that no legitimate authority would tolerate - one estimate claimed that as much as 20% of the capital swilling around the world's market was of illegal origin; as good a reason as any to legalize the drugs trade - the markets now discovered that without the voice of authority, the titles and deeds and capitals they trade are worth nothing. And so they yelp for the very authorities whose authority they have devoured to save them from the logic of their machines, hammering their own stocks with mechanical persistence; at the same time as they reject each successive attempt by the public authorities to impose some control as inadequate and not credible.

Ultimately, this is connected in various ways with the disastrous series of decisions that have entrenched debt at the centre of modern economies and privatized everything that was not nailed down and plenty of things that were. To tease out the various ways in which these things are interdependent would take more time than I have right now, but I may return to the subject.
fpb: (Default)
...it doesn't take genius to see that anyone who invests in good, sound Japanese companies now, while the market is in a panic, will either make a killing or have acquired durable assets cheap.
fpb: (Default)
(Note: I rushed to complete this and publish it because, as I am about to leave, I risked losing it.)

I have been skimming - not really reading - some seventeenth-century English history. One half-remembered feature drew my attention: in England in the sixteen hundred there used to be regular riots, because, even in times of public hunger, large amounts of wheat were exported from the country.

That the people rioted is hardly surprising. These were not beggars, but artisans, employed men, even farm labourers, and their wives; and in times when they knew they could not eat and must watch their children starve, they saw wagon trains loaded with good grain, leaving their counties, making their way to the coast. What was going on?

What was happening was something that many people today will not be able to imagine: the buyers in England were unable to compete with those of the Conntinent - and thus to pay for their own grain - because they had no money. That is not to say that they were poor: they were simply very imperfectly inserted in the money economy. They were industrious workers; but a good deal of what they did wass for barter. Worse still, their main contact with the money economy was the payment of rents, taxes and fines. The money they received went out of their hands again. A man might even have a considerable amount of what would ordinarily be called wealth - own his farm and land outright - and still not only be unable to accumulate capital, but barely be able to conceive of it.

In some parts of the world, this is a recent memory - or still going on today. When my mother was a baby, her parents were considerable landowners in the most fertile area of Italy's deep South, Puglia. And she once told me that there never was any problem with anything that could be grown from the farm - mounds of grain, hills of beautiful oranges - but when it was a matter of buying a pair of shoes - drama!! The whole cycle of life tended to go on with small amounts of money, if any.

I say this because it is important to place our situation as westerners in context. The free availability of money is not natural, but something of a privilege. It is a result of the accumulation of centuries of production reckoned into money, and of the access to structures - in particular, banks and insurance companies - that systematize that access. And it gives us possibilities that our fathers never dreamed of; in particular, to budget for our future. Hesiod's farmer, hard-working and hard-headed though he is, cannot see beyond the next harvest; of old age, he only knows that it is odious and defenceless, and certainly looks forward to going on working for his bread until he is physically incapable. We, on the other hand, can plan ahead.

Loooking around me, in this wasteland of debt public and debt private, in which both nations and individuals have lived their lives according to the amount of money they could borrow, I simply find myself wondering whether a clearer understanding of the privilege of being fully within the money economy - even where you are poor - could not have kept us from quite so many follies.
fpb: (Default)
No central planning-type guru is as smart at allocating scarce resources as a free market pricing mechanism.
(David Limbaugh, Townhall.com, 6 January 2009)

The market in drugs is not free. But in so far as it is free at all - that is, in so far as the prohibition can be dodged - enormous amounts of resources are allocated to drugs; large enough to pay for mighty criminal armies in Latin America and for colossal illegal businesses in the First World. Even so, the trade in illegal drugs is small in volume compared to the trade in legal drugs, specifically spirits, which have no other purpose than intoxication. The free market allocates enough resources to them to support the GDP of several countries. The market in pornography is for all practical purposes free - and in fact it extends to businesses not normally conceived of as pornographic, such as advertising and most of the daily press - and it is large beyond reckoning. The immensely rational and inconceivably smart invisible hand of the free market allocates enough resources to the wholly irrational goal of intoxication and self-abasement that, if it were removed, the result would be economic catastrophe around the world.


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