George Osborne and David Cameron are feeling quite pleased with their economic policy these days, now that Britain's economy is showing signs of clear growth. The Conservatives are now able to claim, using figures to back them up, that the economy is improving.
Yes, things are improving, at least on the surface. Unemployment is down. GDP is up. Housing prices are up. But at the same time, credit consumption is escalating, and living standards are at their lowest for decades. Also, the lack of investment by banks into businesses is becoming the norm. If this is a recovery for the country, why doesn't it feel like it?
Britain is being run like a developing country
The basic answer to this question is that because the government has learned nothing from the financial crisis. As Adtiya Chakrabortty makes clear in this excellent article, Britain's economic model is no different from any in the developing world. The Conservatives are giving living proof to the concept that it is possible to have increasing GDP in a country at the same time as a decreasing standard of living.
This is the frightening reality for many people in Britain. And here's why: GDP is a simple calculation of averages. If the wealth of the top quarter of earners (for example) has sky-rocketed, while the wealth of those in the bottom half has declined in real terms, you still get an increase in GDP. This is basic maths, but it also paints a distorted view, as any average sum can. So relying on GDP in this situation is not helpful to finding out the reality on the ground; in fact, it can be positively deceptive.
The Conservatives either are too dim to understand this basic point, too blinded by their own ideology to see through their delusions, or too indifferent to care.
I've mentioned before that Britain really is ran more like a corporation than a nation-state, and therefore the government is encouraged to see GDP as a simple number; shown to Britain's investors (shareholders) to boost UK PLC's "share price" in the world. The fact that UK PLC's "employees" (its electorate) are having their wages and living standards cut in real terms in order to achieve this is immaterial. The government only really sees the GDP figures.
UK PLC also explains why the government is so keen on "fracking", an expansion in nuclear power, and expanding Heathrow. These things will all improve the country's "rating" in the world. Who cares if it's foreign companies that benefit most from it, at the expense of the actual electorate?
Yes, employment is up, but so what? What kind of jobs are they? Mostly low paid, part-time or temporary, and the idea of getting a stable job these days in The UK is laughable, unless you are in the top ranks of society. Many of the jobs created are in the service sector, where zero-hour contracts are becoming the norm.
In this way, the jobs market in The UK is also more and more resembling that in a developing country, where employment is too heavily dependent on unreliable and highly fickle service industries. The government encouraged young people to get degrees; so now we simply have low-paid service sector jobs filled with graduates. What's the use of that? These service industry jobs are the first to go when there is a downturn.
The wealth delusion
The "recovery" is in large part due to consumer spending. The country has yet to recover from the worst financial crisis since The Depression; much of the spending that's happening on the high street is simply either by eating in to more affluent people's savings, or getting by from month to month on payday loans, and adding even more to the dependence on credit. This is not a sane economic model: it is mass delusion.
This is a dangerously complacent attitude, because it simply suggests that many British people are too weak to face the reality: that many people in Britain are poor. If more and more people are using credit to survive, and are using food banks to survive, this means the country's economic model is broken. But nobody is willing to admit it. The truth hurts, and so people would rather live in an "Alice In Wongaland" view of reality. This is also a time where we are seeing a rise in diseases commonly associated with malnutrition in the developing world (rickets, for example).
The government meanwhile takes the view that food banks are a sign of the "Big Society" - or at least, Cameron does; Iain Duncan Smith seems to take a different view: that he'd prefer to pretend that the problem doesn't exist, and that he's certainly got nothing to do with it.
Calling food banks a sign of the "Big Society" is a sickening joke to those who really use them; the government is helping to create a problem (or at best, is doing nothing to reduce it), then praising people who come the rescue. "Food poverty" is the biggest sign yet that Britain, far from entering a real "recovery", is entering a new era of poverty unprecedented in modern times.
The government puts a great deal of stock in house prices, and George Osborne's "Help To Buy" scheme. Apart from the obvious inflationary dangers that this poses to the market (which are already apparent), Osborne himself admitted that the idea was to make people feel richer - so that they would vote the Tories back in again. So Osborne is openly acting in a cynical and irresponsible way towards the economy.
Not only do people now have much less disposable income to get a mortgage than ten years ago (Britain is fast becoming a nation of tenants), but interest rates are at historically-low rates. The only way is up. And when the rates do begin to climb in the coming years, the housing market will create a whole new generation of "negative equity" victims.
Using housing prices as a marker of wealth, as the Tories do, is as useless as it is cynical. It is inflation in the value of property, nothing more. When the value in "your house" increases, it doesn't mean "you" are richer. If you you bought a house thirty years ago for £30,000, and it's now worth £200,000, you are not £170,000 richer. Why? Because all property in the market has increased by the same value. Unless you are selling a house outright (eg. after a restoration project), downsizing, or moving to a different country with a cheaper housing market, you are not gaining anything.
The obsession with property prices in another sign of Britain's wealth delusion.
Germany doesn't have a wealth delusion, because it's clear where its wealth comes from: manufacturing, and other sectors of the economy.
Britain's economic model is reliant on banking and the kindness of foreigners.
Sunday, December 22, 2013
Wednesday, December 18, 2013
Psychopathy, Ian Watkins and sex crimes: the nature of evil
The sentencing of Ian Watkins, former singer of the band "LostProphets", for a catalogue of sex crimes against children, is another case that adds to the spate of reported crimes, and historical crimes, that have featured in the media since the death of Jimmy Savile. In the last week, a British TV weather presenter, Fred Talbot, has been arrested for historical crimes, as has a former headmaster at a prestigious boys' school.
A recent article by Giles Fraser talks about the nature of this type of "evil", and the possible motivations that occur in the mind of people like Watkins, Savile, and others like them. However uncomfortable it is to think about it, it is important to understand why these people exist: this is why there are people trained in the police and specifically in the area of criminal psychology.
While it should be unnecessary to say so, understanding why such crimes happen does not condone them; no more that understanding why Hitler hated the Jews condones The Holocaust.
To many, child sex crimes rank amongst the worst forms of evil, because the such violations of human rights are against those so vulnerable and innocent. As Giles Fraser's article made clear, these kinds of crimes are nothing about sex; they are about power, and an ultimate, amoral expression of it.
In this way, paedophiles like Savile and Watkins are not so "abnormal" that their evil cannot be understood; it is more that they have become so removed from morality and humanity that their mindset cannot be comprehended by someone with conscience.
The motivations of a psychopath
Psychopathy is a personality disorder defined by a complete lack of conscience towards their actions, and empathy for others.
Psychopaths can unflinchingly carry out the most appalling crimes: some (such as brutal dictators, or, at another level, cut-throat CEOs) can intellectually justify their actions to themselves as part of a wider goal; a dictator to preserve power and "order" to the country; a CEO can justify massive fraud for the sake of boosting a company's share price. These are the calm, amoral psychopaths.
Then there are those who do so not for the sake of a real "goal", or as a means to an end, but simply for the "pleasure" of the act itself: those that simply take pleasure in others' suffering. These are the sadists. And it is this type that are may be considered the worst; for they do their actions not to improve their situation, but simply for the hell of it.
While an amoral psychopath may cause harm for "rational" reasons (to better his own situation), a sadist will easily cause harm for no rational reason whatsoever. Sadists are capable of taking enormous (and irrational) risks for the sake of a momentary act of power against another. It is this that makes them more dangerous, and more difficult to deal with.
People like Watkins and Savile (and sex offenders in general) fall into the latter catagory, because the actions they carried served no "method" other than to cause harm to an innocent person. In this way, paedophiles may be classified as simply a more "extreme" form of sexual psychopath and sadist. Their behaviour and "motivation" fits into many of the attributes connected to psychopathy. They are not "unique" in their evil; they simply plunge to sickening depths of it.
(For more about "Sexual Psychopathy", see here)
The general consensus is that people like Savile and Watkins are products of their cumulative environment. While "psychopathy" as a general rule requires some type of biological dysfunction in the brain, it is also documented that many people who went to commit child sex crimes were themselves "victims" (of one kind or another) at an early age. In order for people like Savile and Watkins to carry out their crimes, there must have been something that had seriously gone wrong at some point. Like all psychological "monsters", they are invariably made, not born.
By understanding how these people are created, it is how crimes like it are prevented in the future.
Causes and solutions
Psychopathy and sociopathy (the latter is generally considered the environmentally-caused disorder, the former primarily biological) have existed in humanity probably since the earliest times in human history. The key to preventing (or limiting) its negative effects on society is to spot the warning signs early on; better still, make a child's environment as stable and balanced as possible.
Sadly, the changes in modern lifestyle, in the family and the effects of technology, have made that job much more difficult. As I've mentioned in a previous article, narcissism (one of the factors that can lead to psychopathy under certain circumstances) is being fed through a vicious circle of the breakdown of the family unit, leading to the young people replacing a fickle family unit with a egocentric "me" unit. Technology may also be playing a part in this, in a way that was never previously possible.
Apart from these negative signs, the positive is that psychopathy is in the public eye in a way never seen before. The more people know about it, the more people will be aware of its causes, and therefore know what they can do to reduce the chance of it becoming manifested.
We can only hope.
A recent article by Giles Fraser talks about the nature of this type of "evil", and the possible motivations that occur in the mind of people like Watkins, Savile, and others like them. However uncomfortable it is to think about it, it is important to understand why these people exist: this is why there are people trained in the police and specifically in the area of criminal psychology.
While it should be unnecessary to say so, understanding why such crimes happen does not condone them; no more that understanding why Hitler hated the Jews condones The Holocaust.
To many, child sex crimes rank amongst the worst forms of evil, because the such violations of human rights are against those so vulnerable and innocent. As Giles Fraser's article made clear, these kinds of crimes are nothing about sex; they are about power, and an ultimate, amoral expression of it.
In this way, paedophiles like Savile and Watkins are not so "abnormal" that their evil cannot be understood; it is more that they have become so removed from morality and humanity that their mindset cannot be comprehended by someone with conscience.
The motivations of a psychopath
Psychopathy is a personality disorder defined by a complete lack of conscience towards their actions, and empathy for others.
Psychopaths can unflinchingly carry out the most appalling crimes: some (such as brutal dictators, or, at another level, cut-throat CEOs) can intellectually justify their actions to themselves as part of a wider goal; a dictator to preserve power and "order" to the country; a CEO can justify massive fraud for the sake of boosting a company's share price. These are the calm, amoral psychopaths.
Then there are those who do so not for the sake of a real "goal", or as a means to an end, but simply for the "pleasure" of the act itself: those that simply take pleasure in others' suffering. These are the sadists. And it is this type that are may be considered the worst; for they do their actions not to improve their situation, but simply for the hell of it.
While an amoral psychopath may cause harm for "rational" reasons (to better his own situation), a sadist will easily cause harm for no rational reason whatsoever. Sadists are capable of taking enormous (and irrational) risks for the sake of a momentary act of power against another. It is this that makes them more dangerous, and more difficult to deal with.
People like Watkins and Savile (and sex offenders in general) fall into the latter catagory, because the actions they carried served no "method" other than to cause harm to an innocent person. In this way, paedophiles may be classified as simply a more "extreme" form of sexual psychopath and sadist. Their behaviour and "motivation" fits into many of the attributes connected to psychopathy. They are not "unique" in their evil; they simply plunge to sickening depths of it.
(For more about "Sexual Psychopathy", see here)
The general consensus is that people like Savile and Watkins are products of their cumulative environment. While "psychopathy" as a general rule requires some type of biological dysfunction in the brain, it is also documented that many people who went to commit child sex crimes were themselves "victims" (of one kind or another) at an early age. In order for people like Savile and Watkins to carry out their crimes, there must have been something that had seriously gone wrong at some point. Like all psychological "monsters", they are invariably made, not born.
By understanding how these people are created, it is how crimes like it are prevented in the future.
Causes and solutions
Psychopathy and sociopathy (the latter is generally considered the environmentally-caused disorder, the former primarily biological) have existed in humanity probably since the earliest times in human history. The key to preventing (or limiting) its negative effects on society is to spot the warning signs early on; better still, make a child's environment as stable and balanced as possible.
Sadly, the changes in modern lifestyle, in the family and the effects of technology, have made that job much more difficult. As I've mentioned in a previous article, narcissism (one of the factors that can lead to psychopathy under certain circumstances) is being fed through a vicious circle of the breakdown of the family unit, leading to the young people replacing a fickle family unit with a egocentric "me" unit. Technology may also be playing a part in this, in a way that was never previously possible.
Apart from these negative signs, the positive is that psychopathy is in the public eye in a way never seen before. The more people know about it, the more people will be aware of its causes, and therefore know what they can do to reduce the chance of it becoming manifested.
We can only hope.
Tuesday, December 17, 2013
The UK's Spouse Visa Regulations: the Conservatives at their worst
The government's rules on granting visas to non-EU spouses of British citizens seem to sum up pretty well all the negative aspects of the Conservative government.
An article in "The Guardian" returns to this sore issue, reminding us of what low depths that the Tories are capable of sinking of when dealing with their own people. The rules are so stringent, they make The UK's rules comparable with the immigration rules of some of the worst authoritarian regimes. Worse, they effectively make British people who wish to marry anyone from outside the EU (which obviously includes The USA, Canada, Australia and New Zealand) exiles from their own country, simply for implementing a basic human right, unless they are wealthy.
Why were these new laws introduced in the first place? The official reason is to reduce "benefit fraud" and foreigners "living off the state", as part of Cameron's impossible-to-achieve "pledge" to reduce annual immigration to the "tens of thousands" (more on Cameron's broken promises here). But the rules now applied are more stringent (and nonsensical) than those in The USA or even Australia. The general consensus is that the rules that prohibit Briton's earning less than approx. £18,000 from bringing their spouses to The UK are really designed to reduce the disproportionate number of Brits of Pakistani and Indian descent from bringing over their cousins in arranged marriages from the subcontinent. That, and to discourage the perceived problem of Brits marrying "brides-to-order" (for want of a less un-PC phrase) from places like the Far East and the former Soviet Union.
Whatever the motivation for these changes, this rule is really about appeasing the Conservatives' party base, as well as the instincts of "The Daily Mail", when it comes to immigration. The facts of the matter are irrelevant; it's the perception of "a problem" that counts.
A system designed to destroy the family
Apart from the financial limits to the rules, there are other rules, also far stricter than other comparable countries, that compound the injustice.
There is also the rule about children, so that the salary base escalates with every child in the Briton's family.
There is also the rule that means that the salary measured must be earned by the "sponsor" (the Brit), rather than the spouse; there is no flexibility if, for example, the foreign spouse earns a higher salary to offset if the Brits' salary is lower than the threshold.
Furthermore, there can be no "co-sponsor" (like in The USA and elsewhere), such as wealthier parents, that can act as a form of financial "insurance" for the couple.
The British "sponsor" must also have paid employment in The UK when the couple live there (i.e. for some time before the foreign spouse arrives).
The British "sponsor" can only get around these rules if they have savings in their account equivalent to more than double (or nearly triple) the average annual salary in The UK.
Lastly, if the "sponsor's" situation changes during the two years the couple are in The UK (such as losing a job), this would effectively condemn any chance of their spouse staying in The UK after their initial two-year "probationary period".
Then there are the many rules designed to catch out the foreign spouses, but there isn't time to go into them all here. It's enough to say that from the initial application of a spouse visa, the Briton and their non-EU spouse are assumed guilty of deception until they can prove they are an honest (and well-financed) married couple.
Such an ordeal would test the strongest of relationships; it is not surprising that some would break down under the stresses of such a system. Children are deprived of their parents for months on end under such a system. Under the guise of defending Britain against "sham marriages", they implement rules that break the one of the most fundamental human rights in the world: the right to choose who you want to live your life with, and the right to live in your own country with the person you wish.
A Kafkaesque nightmare
These rules display the Conservatives are their most heartless as well as their most nonsensical.
Some might say "a person can't expect the state the fund your relationship choices". Well, The USA and The EU don't have a problem with that idea, within reasonable limits. As mentioned earlier, The USA see that it is reasonable to maintain the coherence of the family unit, and allow a "co-sponsor" of a married American an a foreign spouse living the The USA.
The EU's attitudes are even more humane: according to EU law (which The UK government flouts to implement these nonsensical rules) any EU citizen cannot be denied the right to live in the EU without his spouse, regardless of where they are from. This is again to preserve the sanctity of the family; even more important if they are children involved.
It's because of these EU rules that there is a way around the UK government's rules. As any Briton is also an EU citizen, they can simply move to any other EU country (such and the Republic Of Ireland) and live there with their non-EU spouse. These are the Kafkaesque lengths that the Conservatives are pushing their own people to in order to be happily married.
This is just one of a catalogue of Conservative disasters committed while in government. And while Brits who marry anyone from outside the EU are subjected to these inhumane restrictions (creating a whole subset of British "marriage exiles"), any other EU family is free to move into The UK without any legal restriction.
Such a situation invites comparisons (if perhaps over-indulgently) to political and economic refugees. Certainly, no other Western developed country has such an inhumane and cynical attitude towards foreign marriage. While those in the developing world have been banished from their own countries for their political beliefs, thousands of Brits are being forced to live outside their home country for their relationship choices.
The UK government is effectively saying: "You Can Only Marry Who We Say You Can". If you don't, then prepare to suffer the consequences.
The government introduces these rules to avoid "marriages of convenience": and yet the government encourages Britons to marry only people who they consider "convenient" for themselves. When the government talks about "marriages of convenience", it simply means it objects to marriages inconvenient to its interests.
If there was one way for the government to encourage British people become more cynical in their relations towards each other, foreigners and the institution of marriage, this certainly would be one way to achieve it.
And this, from the supposed party of "family values".
An article in "The Guardian" returns to this sore issue, reminding us of what low depths that the Tories are capable of sinking of when dealing with their own people. The rules are so stringent, they make The UK's rules comparable with the immigration rules of some of the worst authoritarian regimes. Worse, they effectively make British people who wish to marry anyone from outside the EU (which obviously includes The USA, Canada, Australia and New Zealand) exiles from their own country, simply for implementing a basic human right, unless they are wealthy.
Why were these new laws introduced in the first place? The official reason is to reduce "benefit fraud" and foreigners "living off the state", as part of Cameron's impossible-to-achieve "pledge" to reduce annual immigration to the "tens of thousands" (more on Cameron's broken promises here). But the rules now applied are more stringent (and nonsensical) than those in The USA or even Australia. The general consensus is that the rules that prohibit Briton's earning less than approx. £18,000 from bringing their spouses to The UK are really designed to reduce the disproportionate number of Brits of Pakistani and Indian descent from bringing over their cousins in arranged marriages from the subcontinent. That, and to discourage the perceived problem of Brits marrying "brides-to-order" (for want of a less un-PC phrase) from places like the Far East and the former Soviet Union.
Whatever the motivation for these changes, this rule is really about appeasing the Conservatives' party base, as well as the instincts of "The Daily Mail", when it comes to immigration. The facts of the matter are irrelevant; it's the perception of "a problem" that counts.
A system designed to destroy the family
Apart from the financial limits to the rules, there are other rules, also far stricter than other comparable countries, that compound the injustice.
There is also the rule about children, so that the salary base escalates with every child in the Briton's family.
There is also the rule that means that the salary measured must be earned by the "sponsor" (the Brit), rather than the spouse; there is no flexibility if, for example, the foreign spouse earns a higher salary to offset if the Brits' salary is lower than the threshold.
Furthermore, there can be no "co-sponsor" (like in The USA and elsewhere), such as wealthier parents, that can act as a form of financial "insurance" for the couple.
The British "sponsor" must also have paid employment in The UK when the couple live there (i.e. for some time before the foreign spouse arrives).
The British "sponsor" can only get around these rules if they have savings in their account equivalent to more than double (or nearly triple) the average annual salary in The UK.
Lastly, if the "sponsor's" situation changes during the two years the couple are in The UK (such as losing a job), this would effectively condemn any chance of their spouse staying in The UK after their initial two-year "probationary period".
Then there are the many rules designed to catch out the foreign spouses, but there isn't time to go into them all here. It's enough to say that from the initial application of a spouse visa, the Briton and their non-EU spouse are assumed guilty of deception until they can prove they are an honest (and well-financed) married couple.
Such an ordeal would test the strongest of relationships; it is not surprising that some would break down under the stresses of such a system. Children are deprived of their parents for months on end under such a system. Under the guise of defending Britain against "sham marriages", they implement rules that break the one of the most fundamental human rights in the world: the right to choose who you want to live your life with, and the right to live in your own country with the person you wish.
A Kafkaesque nightmare
These rules display the Conservatives are their most heartless as well as their most nonsensical.
Some might say "a person can't expect the state the fund your relationship choices". Well, The USA and The EU don't have a problem with that idea, within reasonable limits. As mentioned earlier, The USA see that it is reasonable to maintain the coherence of the family unit, and allow a "co-sponsor" of a married American an a foreign spouse living the The USA.
The EU's attitudes are even more humane: according to EU law (which The UK government flouts to implement these nonsensical rules) any EU citizen cannot be denied the right to live in the EU without his spouse, regardless of where they are from. This is again to preserve the sanctity of the family; even more important if they are children involved.
It's because of these EU rules that there is a way around the UK government's rules. As any Briton is also an EU citizen, they can simply move to any other EU country (such and the Republic Of Ireland) and live there with their non-EU spouse. These are the Kafkaesque lengths that the Conservatives are pushing their own people to in order to be happily married.
This is just one of a catalogue of Conservative disasters committed while in government. And while Brits who marry anyone from outside the EU are subjected to these inhumane restrictions (creating a whole subset of British "marriage exiles"), any other EU family is free to move into The UK without any legal restriction.
Such a situation invites comparisons (if perhaps over-indulgently) to political and economic refugees. Certainly, no other Western developed country has such an inhumane and cynical attitude towards foreign marriage. While those in the developing world have been banished from their own countries for their political beliefs, thousands of Brits are being forced to live outside their home country for their relationship choices.
The UK government is effectively saying: "You Can Only Marry Who We Say You Can". If you don't, then prepare to suffer the consequences.
The government introduces these rules to avoid "marriages of convenience": and yet the government encourages Britons to marry only people who they consider "convenient" for themselves. When the government talks about "marriages of convenience", it simply means it objects to marriages inconvenient to its interests.
If there was one way for the government to encourage British people become more cynical in their relations towards each other, foreigners and the institution of marriage, this certainly would be one way to achieve it.
And this, from the supposed party of "family values".
Sunday, December 15, 2013
UK PLC: How Britain is ran like a corporation
Back in October the latest "success story" that the UK government declared was that a new generation of nuclear power station would be built at Hinkley point in Somerset, ran by the French energy giant EDF with Chinese support.
Around that time I mentioned that this event was simply another in a long line of government actions that are meant to improve Britain's fortunes, but achieve the opposite.
There is a tendency in Britain for foreign companies to run essential services and national assets, more than in any other comparable Western developed country.
The term "UK PLC" became widely-used during the Blair years, when the government was looking for a way to turn "Cool Britannia" into a brand that they could advertise the UK to foreign investment. Britain was marketed as "a good place to do business". Laws were loosened so that foreign companies could have a greater and greater role in The UK.
The spate of privatisation of government assets from the eighties onwards has led to segments of the energy industry and other utilities being owned by foreign companies (in the case of EDF, a government-owned foreign company).
When the transport network was sold off, buses and trains were sold off to whichever company offered the lowest price, regardless of if this meant effectively selling national assets to foreign governments. This was the case with companies such as "Arriva" (owned by Deutsche Bahn); the Dutch national rail carrier also owns rail stock in East Anglia and Merseyside.
I made these points in my earlier article on the subject, so don't want to repeat myself. The main observation to note here is that the actions of the British government, and even more the actions of the current Conservative-led government, are the same as those seen in the boardrooms of multinational companies.
Working in the "national interest"
The key here is how government ministers define "national interest". To the electorate, the "national interest" is would be what is in the electorate's best interest. To the government, the "national interest" is what will create the most money for the government. They are not the same things.
To understand how "UK PLC" works in reality it's easier to have a thought experiment and to imagine the British government as "a corporation that happens to operate within a national border", or a wannabe multinational company.
Like all multinationals, it has shareholders and employees. Who are they?
Its shareholders are the ones that really matter, because this is they who UK PLC's revenue is aimed at. The shareholders are the private businesses that have invested money into the UK, for it is they who really generate the income for the British government (as far as they see it). Therefore, the more future investment the government can generate, the more UK PLC's "shareholders" (private companies) will be willing to invest further in The UK. The happier the "shareholders" (i.e. investors) are, the better the fortunes of the British government. The "shareholders" want to make sure that their investment is a sound one; otherwise, they will sell their shares and go elsewhere.
In this description, it may not sound a lot different from a Ponzi scheme.
UK PLC's "employees" are its electorate. Multinationals are not renowned for treating their employees well; almost all of them seek the cheapest workforce possible. UK PLC, like other multinational companies, doesn't care where its employees come from. Limited by the resource of land, UK PLC's workforce is still constrained within the territory it contains, so therefore over-population would bring disadvantages to UK PLC over time. But apart from the long-term threat of over-population, it is to UK PLC's advantage to have a workforce that is composed of immigrants from poorer countries, in order to help limit wage demands and keep down overheads.
Of course, there will be some employees that are also shareholders, as in any multinational. But this is incidental. The main point here is that, like employees working for any multinational, those at UK PLC are expendable, and can be easily replaced. Fundamentally, they have no rights of their own, and UK PLC owes them no loyalty.
Why UK PLC loves Europe
Seen through this lens, a lot of what happens in the UK today makes much more sense. The rise of UKIP in recent times has been a result of the (correct) perception that the mass influx of East Europeans to The UK has brought about a labour crisis for some parts of the "native" population.
The government has blamed the freedom of movement around the EU for this, which is accurate, but fails to mention that it is also part of the government's intention. Much of UK PLC's "shareholders" (British and foreign investors) are strongly pro-EU because it helps them to lower wages by using workers from elsewhere in the EU (from Southern Europe as well as Eastern Europe).
At the same time, however, British people are far less likely to have linguistic ability compared to foreigners. Lulled into a false sense of security by the government, the electorate were led to believe that their economic stability would last forever because English is "the world's language". Now the UK government blames their own electorate for not taking advantage of the EU's freedom of labour mobility by not bothering to learn foreign languages.
It is not surprising that some people are left feeling "betrayed" by their own government.
The future of Britain looks more and more like that of a multinational company looking for new ways to find foreign investment and "partnerships". David Cameron's recent work with China demonstrates that is really what he sees The UK as. Rather than invest in "native" resources, it is cheaper and easier to ask foreign companies to do the work. This explains why an ever larger part of Britain's assets and services are being offered to foreign companies: because they are cheaper.
Rather than invest in Britain's assets and make them more efficient (which would be a longer-term project, but obviously better for the native workforce), it is easier and faster to simply hand them over to foreigners; like how multinationals "out-source" their services because it's cheaper.
In this way, the government has little real sense of loyalty to its own electorate: they are just "employees", and can be easily replaced with others who are more suitable to their needs.
It is the multinational cartels that are calling many of the shots because it is they who are the real "shareholders" in UK PLC, and other governments like it. UK PLC is far from alone in this regard; much of 21st century government across the world runs on the same principle.
Around that time I mentioned that this event was simply another in a long line of government actions that are meant to improve Britain's fortunes, but achieve the opposite.
There is a tendency in Britain for foreign companies to run essential services and national assets, more than in any other comparable Western developed country.
The term "UK PLC" became widely-used during the Blair years, when the government was looking for a way to turn "Cool Britannia" into a brand that they could advertise the UK to foreign investment. Britain was marketed as "a good place to do business". Laws were loosened so that foreign companies could have a greater and greater role in The UK.
The spate of privatisation of government assets from the eighties onwards has led to segments of the energy industry and other utilities being owned by foreign companies (in the case of EDF, a government-owned foreign company).
When the transport network was sold off, buses and trains were sold off to whichever company offered the lowest price, regardless of if this meant effectively selling national assets to foreign governments. This was the case with companies such as "Arriva" (owned by Deutsche Bahn); the Dutch national rail carrier also owns rail stock in East Anglia and Merseyside.
I made these points in my earlier article on the subject, so don't want to repeat myself. The main observation to note here is that the actions of the British government, and even more the actions of the current Conservative-led government, are the same as those seen in the boardrooms of multinational companies.
Working in the "national interest"
The key here is how government ministers define "national interest". To the electorate, the "national interest" is would be what is in the electorate's best interest. To the government, the "national interest" is what will create the most money for the government. They are not the same things.
To understand how "UK PLC" works in reality it's easier to have a thought experiment and to imagine the British government as "a corporation that happens to operate within a national border", or a wannabe multinational company.
Like all multinationals, it has shareholders and employees. Who are they?
Its shareholders are the ones that really matter, because this is they who UK PLC's revenue is aimed at. The shareholders are the private businesses that have invested money into the UK, for it is they who really generate the income for the British government (as far as they see it). Therefore, the more future investment the government can generate, the more UK PLC's "shareholders" (private companies) will be willing to invest further in The UK. The happier the "shareholders" (i.e. investors) are, the better the fortunes of the British government. The "shareholders" want to make sure that their investment is a sound one; otherwise, they will sell their shares and go elsewhere.
In this description, it may not sound a lot different from a Ponzi scheme.
UK PLC's "employees" are its electorate. Multinationals are not renowned for treating their employees well; almost all of them seek the cheapest workforce possible. UK PLC, like other multinational companies, doesn't care where its employees come from. Limited by the resource of land, UK PLC's workforce is still constrained within the territory it contains, so therefore over-population would bring disadvantages to UK PLC over time. But apart from the long-term threat of over-population, it is to UK PLC's advantage to have a workforce that is composed of immigrants from poorer countries, in order to help limit wage demands and keep down overheads.
Of course, there will be some employees that are also shareholders, as in any multinational. But this is incidental. The main point here is that, like employees working for any multinational, those at UK PLC are expendable, and can be easily replaced. Fundamentally, they have no rights of their own, and UK PLC owes them no loyalty.
Why UK PLC loves Europe
Seen through this lens, a lot of what happens in the UK today makes much more sense. The rise of UKIP in recent times has been a result of the (correct) perception that the mass influx of East Europeans to The UK has brought about a labour crisis for some parts of the "native" population.
The government has blamed the freedom of movement around the EU for this, which is accurate, but fails to mention that it is also part of the government's intention. Much of UK PLC's "shareholders" (British and foreign investors) are strongly pro-EU because it helps them to lower wages by using workers from elsewhere in the EU (from Southern Europe as well as Eastern Europe).
At the same time, however, British people are far less likely to have linguistic ability compared to foreigners. Lulled into a false sense of security by the government, the electorate were led to believe that their economic stability would last forever because English is "the world's language". Now the UK government blames their own electorate for not taking advantage of the EU's freedom of labour mobility by not bothering to learn foreign languages.
It is not surprising that some people are left feeling "betrayed" by their own government.
The future of Britain looks more and more like that of a multinational company looking for new ways to find foreign investment and "partnerships". David Cameron's recent work with China demonstrates that is really what he sees The UK as. Rather than invest in "native" resources, it is cheaper and easier to ask foreign companies to do the work. This explains why an ever larger part of Britain's assets and services are being offered to foreign companies: because they are cheaper.
Rather than invest in Britain's assets and make them more efficient (which would be a longer-term project, but obviously better for the native workforce), it is easier and faster to simply hand them over to foreigners; like how multinationals "out-source" their services because it's cheaper.
In this way, the government has little real sense of loyalty to its own electorate: they are just "employees", and can be easily replaced with others who are more suitable to their needs.
It is the multinational cartels that are calling many of the shots because it is they who are the real "shareholders" in UK PLC, and other governments like it. UK PLC is far from alone in this regard; much of 21st century government across the world runs on the same principle.
Friday, December 13, 2013
Ayn Rand, Objectivism, Capitalism and Psychopathy
I wrote an article a long time ago comparing Ayn Rand's moral and economic philosophy, Objectivism, with the psychological disorder, psychopathy. The main tenets of her philosophy were explained in her own words in an interview she had after the publication of her magnum opus, "Atlas Shrugged".
It's worth remembering that Ayn Rand was a Russian Jew, born in St Petersburg the first decade of the Twentieth Century, albeit to a non-practising family. She was in her early teens when she experienced her father's business being appropriated by the Bolsheviks, which clearly had a very strong influence on her ideas about government and society. After completing university in the Soviet Union, she took an opportunity to go to the USA, and never came back.
The lunatics take over the asylum
Rand's ideas are integral to anyone who understands what free market Capitalism is, as well as understanding what the justifications are by those who pursue its ideas with such vigour. Anyone involved in finance and economics, either at the corporate or academic level, needs to have an understanding of - and more importantly, be an adherent to - its principles and ideology. If you are not a laissez-faire Capitalist in today's world, you cannot succeed in finance or economics, let alone business.
This is all the more shocking considering how the financial crisis dealt the biggest possible blow to the idea of unregulated free markets. The crisis happened because there was no effective government regulation, and that the banking sector had become dominated by giants that were "too big to fail"; this was what Rand had said should have been impossible under a laissez-faire system. The government had done precisely what the banks had told them to - what all the most distinguished economists had told them to do - and the system had collapsed in on itself as a result of their "wisdom".
If the orthodoxy of any other system - science, for example - had received such a blow to its legitimacy, it would have caused a radical reworking of their approach. In economics, however, no such worries seem to exist. The economists and financial "experts" continue as if nothing had happened, giving governments the same advice as before. The UK is suffering from the same kind of madness in government.
Rand's ideas were not new when they were first published, but prior to that, only a small number of economists and other oddballs took the idea of laissez-faire Capitalism as something that had a serious place in the world. They had been expressed before the Second World War through the "Austrian School" of economics, and after the Second World War, in the "Chicago School". It was Rand who turned an economic theory into a moral code for living.
A "Randian" perspective on living
Rand's interviewer from the clip I mentioned earlier takes a (not surprisingly) sceptical view of her ideas when she expresses them; for one thing, they go against almost every moral code known to man. She summarises her philosophy into a few main points.
Rand calls her philosophy "Objectivism" because it is a philosophy that takes its moral code not from using religious or social values (which are therefore subjective), but from the perspective solely of the individual (who is therefore "objective"). A person's moral code, according to Rand, can only be decided by what is in his or her best interests - or other words, what is convenient.
Following from this, it is against a person's interests to help someone else selflessly, because the man helping gets nothing in return for his efforts; it might also be mentioned that it makes the man receiving dependent on someone else. Looking at it from this perspective, Rand considers altruism to be evil, the opposite to what social norms tell us.
As Rand says, this attitude is based on man as a rational being: doing things based on his rational mind, and avoiding actions which are illogical (i.e. not convenient to his interests).
At around this point in the above interview that the interviewer asks Rand about "love". What about "love"? Should a man not help another out of "love"? Rand's answer is that "love" in the interviewer's (and mankind's) understanding of the word is self-defeating: one can only "love" another person for their achievements; loving a person simply for being a human being, so Rand thinks, is ludicrous, because how can you "love" someone who you don't know?
What Rand's philosophy postulates is a social network of interactions based on mutual convenience, and that it is rational that all human interactions be based on this primary principle.
(Any "Star Trek" fans might be familiar with this perspective: the character Spock, at one point in the original series, introduced his Vulcan wife to the crew. It was in this episode that the viewer was educated about the "logic" behind the marriage of two people who are without emotion)
A cynic might also recognize the same thinking in "marriages of convenience" today. But in Rand's thinking, all marriages and human interactions must be rationally so. Otherwise, why demean yourself to something that is inconvenient?
The philosophy of a psychopath
Rand's philosophy focuses on the meaning of freedom. In it, a person is free to do as he or she likes, as long as it does not impinge on the freedom of others. This is how law and order is maintained in such a society, and that the only function a government has is to maintain basic law and order and the justice system.
Government should not therefore raise any taxes that are not agreed by the consent of all people taxed. As a person's wit and wealth is his primary means of survival (only means of survival), it is not the government's role to dictate how a person spends his wealth.
As people are therefore rational, it follows that in a laissez-faire society, the free market will provide all goods and services possible, and that no-one would be unemployed or in a job they didn't like if they didn't choose it. Besides, it would be irrational to help those less fortunate than yourself for no reason and for not benefit to yourself.
Lastly, Rand's philosophy refutes the idea of democracy, seeing it as nothing more than majoritarianism. In a free society, one larger group cannot dictate to another. By this logic, "interest groups" as such couldn't possibly exist, let alone "parties". As Rand sees it, this is going back to the first principles of the "Founding Fathers".
An "Objectivist" world sounds a lot like an anarchist one (which Rand personally despised); the caveat that Rand always made against this accusation is the role of law and order and government's monopoly on the use of force. But having had Rand's philosophy largely put into practice for the last thirty years, we know the real results: a heavenly bliss for those at the top of society, and a version of hell for those at the bottom.
I've written many times before about the attributes of psychopaths. When you look at the behaviour that Rand's perspective encourages (even celebrates) - selfishness, lack of empathy towards others, being motivated by convenience - it mirrors some of the key attributes of psychopathy. The only thing that separates Rand's philosophy from being a "manual for psychopaths" is the respect for others' freedom and the need for basic law and order.
But that separation can easily be blurred. When do a company's actions cross the line towards impinging on others' "freedom"? Or an individual's? Such a society could easily make "people of ill intent" simply become more Machiavellian and cunning in order to impinge on others' freedoms indirectly, in a way not immediately obvious. From companies that get around regulations, to people who find loopholes to avoid paying tax, these things happen everywhere, everyday.
Rand's theory of "Objectivism" is clearly atheistic by nature; her views on Capitalism and turning society's moral code on its head certainly would bring out accusations from the clergy that she was nothing more than a female "Antichrist", or a servant of Lucifer himself. I've made such (tongue-in cheek) comments myself before.
Rand lived until 1982, so that she saw the first beginnings of her philosophy put into practice by Reagan and Thatcher.
It is the rest of us who have had to deal with the results of her philosophy, as it continues to rule us like a vampire that will not die, even after being intellectually "killed" by the financial crisis. The principles of her philosophy, if anything, seem to become more refined with age; given a second wind with the calls for "austerity", as the "Tea Party" in The USA take Rand's ideas to levels even Reagan didn't dare to tread, and in The UK, the Chancellor George Osborne and PM David Cameron try to out-do Thatcher at her own game.
Like Rand before them turning society's moral code on its head, today's adherents to her philosophy use counter-intuitive arguments for their policies: the "trickle-down" theory; Osborne in The UK blaming the "welfare state" for the financial crisis; the Tea Party in The USA blaming "entitlements" and "socialized medicine".
Like Rand before them, her disciples today use the sweet words of freedom to implement ideas that cause poverty and inequality.
Like the Lucifer of The Bible, Rand and her followers manipulate humanity and seduce us with talk of our own magnificence as individuals, and how evil "government" is (our modern-day "God" of The Bible). Much of this biblical symbolism is described, in a very allegorical sense, by Rand herself in the pages of her most famous work, "Atlas Shrugged".
But some people like government; like how some people like God. They both require faith to survive.
It's worth remembering that Ayn Rand was a Russian Jew, born in St Petersburg the first decade of the Twentieth Century, albeit to a non-practising family. She was in her early teens when she experienced her father's business being appropriated by the Bolsheviks, which clearly had a very strong influence on her ideas about government and society. After completing university in the Soviet Union, she took an opportunity to go to the USA, and never came back.
The lunatics take over the asylum
Rand's ideas are integral to anyone who understands what free market Capitalism is, as well as understanding what the justifications are by those who pursue its ideas with such vigour. Anyone involved in finance and economics, either at the corporate or academic level, needs to have an understanding of - and more importantly, be an adherent to - its principles and ideology. If you are not a laissez-faire Capitalist in today's world, you cannot succeed in finance or economics, let alone business.
This is all the more shocking considering how the financial crisis dealt the biggest possible blow to the idea of unregulated free markets. The crisis happened because there was no effective government regulation, and that the banking sector had become dominated by giants that were "too big to fail"; this was what Rand had said should have been impossible under a laissez-faire system. The government had done precisely what the banks had told them to - what all the most distinguished economists had told them to do - and the system had collapsed in on itself as a result of their "wisdom".
If the orthodoxy of any other system - science, for example - had received such a blow to its legitimacy, it would have caused a radical reworking of their approach. In economics, however, no such worries seem to exist. The economists and financial "experts" continue as if nothing had happened, giving governments the same advice as before. The UK is suffering from the same kind of madness in government.
Rand's ideas were not new when they were first published, but prior to that, only a small number of economists and other oddballs took the idea of laissez-faire Capitalism as something that had a serious place in the world. They had been expressed before the Second World War through the "Austrian School" of economics, and after the Second World War, in the "Chicago School". It was Rand who turned an economic theory into a moral code for living.
A "Randian" perspective on living
Rand's interviewer from the clip I mentioned earlier takes a (not surprisingly) sceptical view of her ideas when she expresses them; for one thing, they go against almost every moral code known to man. She summarises her philosophy into a few main points.
Rand calls her philosophy "Objectivism" because it is a philosophy that takes its moral code not from using religious or social values (which are therefore subjective), but from the perspective solely of the individual (who is therefore "objective"). A person's moral code, according to Rand, can only be decided by what is in his or her best interests - or other words, what is convenient.
Following from this, it is against a person's interests to help someone else selflessly, because the man helping gets nothing in return for his efforts; it might also be mentioned that it makes the man receiving dependent on someone else. Looking at it from this perspective, Rand considers altruism to be evil, the opposite to what social norms tell us.
As Rand says, this attitude is based on man as a rational being: doing things based on his rational mind, and avoiding actions which are illogical (i.e. not convenient to his interests).
At around this point in the above interview that the interviewer asks Rand about "love". What about "love"? Should a man not help another out of "love"? Rand's answer is that "love" in the interviewer's (and mankind's) understanding of the word is self-defeating: one can only "love" another person for their achievements; loving a person simply for being a human being, so Rand thinks, is ludicrous, because how can you "love" someone who you don't know?
What Rand's philosophy postulates is a social network of interactions based on mutual convenience, and that it is rational that all human interactions be based on this primary principle.
(Any "Star Trek" fans might be familiar with this perspective: the character Spock, at one point in the original series, introduced his Vulcan wife to the crew. It was in this episode that the viewer was educated about the "logic" behind the marriage of two people who are without emotion)
A cynic might also recognize the same thinking in "marriages of convenience" today. But in Rand's thinking, all marriages and human interactions must be rationally so. Otherwise, why demean yourself to something that is inconvenient?
The philosophy of a psychopath
Rand's philosophy focuses on the meaning of freedom. In it, a person is free to do as he or she likes, as long as it does not impinge on the freedom of others. This is how law and order is maintained in such a society, and that the only function a government has is to maintain basic law and order and the justice system.
Government should not therefore raise any taxes that are not agreed by the consent of all people taxed. As a person's wit and wealth is his primary means of survival (only means of survival), it is not the government's role to dictate how a person spends his wealth.
As people are therefore rational, it follows that in a laissez-faire society, the free market will provide all goods and services possible, and that no-one would be unemployed or in a job they didn't like if they didn't choose it. Besides, it would be irrational to help those less fortunate than yourself for no reason and for not benefit to yourself.
Lastly, Rand's philosophy refutes the idea of democracy, seeing it as nothing more than majoritarianism. In a free society, one larger group cannot dictate to another. By this logic, "interest groups" as such couldn't possibly exist, let alone "parties". As Rand sees it, this is going back to the first principles of the "Founding Fathers".
An "Objectivist" world sounds a lot like an anarchist one (which Rand personally despised); the caveat that Rand always made against this accusation is the role of law and order and government's monopoly on the use of force. But having had Rand's philosophy largely put into practice for the last thirty years, we know the real results: a heavenly bliss for those at the top of society, and a version of hell for those at the bottom.
I've written many times before about the attributes of psychopaths. When you look at the behaviour that Rand's perspective encourages (even celebrates) - selfishness, lack of empathy towards others, being motivated by convenience - it mirrors some of the key attributes of psychopathy. The only thing that separates Rand's philosophy from being a "manual for psychopaths" is the respect for others' freedom and the need for basic law and order.
But that separation can easily be blurred. When do a company's actions cross the line towards impinging on others' "freedom"? Or an individual's? Such a society could easily make "people of ill intent" simply become more Machiavellian and cunning in order to impinge on others' freedoms indirectly, in a way not immediately obvious. From companies that get around regulations, to people who find loopholes to avoid paying tax, these things happen everywhere, everyday.
Rand's theory of "Objectivism" is clearly atheistic by nature; her views on Capitalism and turning society's moral code on its head certainly would bring out accusations from the clergy that she was nothing more than a female "Antichrist", or a servant of Lucifer himself. I've made such (tongue-in cheek) comments myself before.
Rand lived until 1982, so that she saw the first beginnings of her philosophy put into practice by Reagan and Thatcher.
It is the rest of us who have had to deal with the results of her philosophy, as it continues to rule us like a vampire that will not die, even after being intellectually "killed" by the financial crisis. The principles of her philosophy, if anything, seem to become more refined with age; given a second wind with the calls for "austerity", as the "Tea Party" in The USA take Rand's ideas to levels even Reagan didn't dare to tread, and in The UK, the Chancellor George Osborne and PM David Cameron try to out-do Thatcher at her own game.
Like Rand before them turning society's moral code on its head, today's adherents to her philosophy use counter-intuitive arguments for their policies: the "trickle-down" theory; Osborne in The UK blaming the "welfare state" for the financial crisis; the Tea Party in The USA blaming "entitlements" and "socialized medicine".
Like Rand before them, her disciples today use the sweet words of freedom to implement ideas that cause poverty and inequality.
Like the Lucifer of The Bible, Rand and her followers manipulate humanity and seduce us with talk of our own magnificence as individuals, and how evil "government" is (our modern-day "God" of The Bible). Much of this biblical symbolism is described, in a very allegorical sense, by Rand herself in the pages of her most famous work, "Atlas Shrugged".
But some people like government; like how some people like God. They both require faith to survive.
Tuesday, December 10, 2013
Why Cartels run most of the world
I wrote previously about how "government service agencies" like Serco run many aspects of government service provision in The UK and elsewhere. But it is only when you take a step back and look at different aspects of how the world works, that you realise that much of the world is effectively ran by various types of cartels.
Cartels are most famous in crime, such as the drugs cartels that exist in Columbia, and more recently in Mexico.
But they exist in almost every major aspect of the private sector; drugs is simply a more infamous example.
An article here provides a chart that explains how ten (multinational) companies produce almost everything that we buy.
Pharmaceuticals are produced by a small number (i.e cartel) of "Big Pharma" companies, the results of which have been examined in a book of the same name.
"Big Oil" has become amalgamated into an ever decreasing number of mega-corporations: ExxonMobil (as the result of a merger in the late nineties), BP, Chevron, Conoco Phillips and Shell are the main ones in the West. The mergers that happened in the nineties and earlier were partially a result of the entrenchment of nationalised oil companies that previously were in the clutches of Western multinationals. Since that time, Western oil companies have entrenched themselves by expanding into previously uncharted territory; exploring shale gas and oil sands due to advances in technology.
Before the oil crisis of the early seventies, the so called "Seven Sisters" produced the vast majority of the world's oil. The advances of "Big Oil" into new forms of oil and gas exploration are also a result of the rise of the "New Seven Sisters", which are effectively nationalised industries of various developing and non-Western nations. In other words, while in the West oil is concentrated into the hands of a handful of private corporations, in the "East", it is consolidated into the hands of government through government-ran oil companies.
And over all this is OPEC, which itself is a cartel (or oligarchy) of nations that has huge influence over the price of oil.
Technology is another area dominated by a small number of companies. Computer software is dominated by Microsoft and Apple. Other domestic technology (TVs, stereos) is dominated by Far Eastern companies; "White Goods", to a lesser extent also.
Multinationals are everywhere. A telling story is when the former head of ExxonMobil in the nineties quickly put down another colleague for calling them an "American" company. ExxonMobil wasn't an "American" company as far as the CEO was concerned; it was a global one , and as such, owed no loyalty to any one nation.
The nature of the market
But the creation of an oligarchy/cartel is even more frighteningly evident in finance. In the Victorian era, there were hundreds of banks across every major developed nation in the world. The USA and The UK are the best examples of this. But since that time, and from every major economic downturn or depression, banks have either gone under or been bought out.
Each time this has happened, the power to control finance has fell into a smaller and smaller number of private banks; so that by the time of financial crisis of 2008, there are only a bare handful of banks that control much of the world's finance, Goldman Sachs being perhaps the biggest. BearStearns' sale to JP MorganChase in March 2008 was the precursor to the panic following the bankruptcy of Lehman Brothers in September. Following from this, other banks merged to consolidate assets, and the creation of the concept of them being "too big to fail", necessitating the infamous bailout out of the public purse.
The acceptance of the "too big to fail" cartel (TBTF) effectively legitimized the concept of "Corporate Socialism": one rule for the rich, another for the poor. It meant that national governments effectively accepted control of the world economy was no longer in their hands, but in that of the cartel of international investment banks.
In the five years since that event, the cartels of finance, of oil, and of foodstuffs have presided over a collapse of living standards in the West, especially in the economies of Southern Europe, and parts of The USA and The UK. Costs of living have increased year after year, while governments freeze wages and spending in order to repair the damage done by the banks from the financial crisis.
Cartels are the enemy of freedom; they are as dangerous now as they were when the ancient Greeks talked of an "oligarchy" in the time of Plato and Socrates. But cartels are a natural result of neo-liberal economics. While Ayn Rand and the Chicago School of economics argued that free market Capitalism would naturally result in more choice for the consumer and therefore lower prices, the result has been the opposite in the long-run.
In the dog-eat-dog world of free market liberalism, when applied on a global scale (creating "Globalisation") the result is that this creates larger and larger companies that literally eat up their rivals (through mergers), while killing off the competition. Because small companies cannot possibly hope to compete fairly in such an environment, the result is a lack of choice for the consumer, or price-fixing. The Libor rate scandal in the financial industry, the role of OPEC in the oil industry, and the various tariffs and subsidies set up against the interests of the developing world, are a testament to that.
Only a handful of huge companies can most efficiently operate as pan-national entities in order to find the cheapest methods of production for the greatest profit. This therefore has the effect of depressing wages overall, while increasing the share value of the companies themselves, and massively boosting the incomes of the fractional percentile at the top. This may sound quite a lot like Marxist theory, but it is the reality today.
In this way, cartels are a natural result of free market Capitalism. When applied on a global scale, you simply get a global cartel, independent of government control: independent of accountability, and in control of the global supply chain.
How to blackmail the government
The history of the last hundred years or so has seen a gradual breaking down of the power of the nation-state, and a transfer of power to ever-larger multinational cartels of private companies. In effect, this is a transfer of accountability from governments ultimately accountable to their electorate, to private companies only accountable to their shareholders.
Because modern-day multinationals are trans-national entities, laws from individual governments hold less and less authority. In the end, the multinational can always up sticks and transfer operations to nation with a more amenable government; this is how globalisation works.
In this way, "government" in the 21st century has become less and less relevant to everyday life, as private multinationals (often working as part of an informal cartel or oligarchy) dictate much of what happens. Governments have become beholden to the interests of "big business" because they hold fewer and fewer means to hold these private oligarchies to account. In the end, a powerful private corporation can always threaten a dissatisfied government with economic blackmail: "what are you going to do if we leave the country?", the multinational can say. "Where will you get your revenue and jobs from?".
This is what happens around the world, and has happened as recently as the financial crisis when then banks were asking for help from government. In the end, such as in The UK, there was always the threat to take their business elsewhere. After the financial sector had encouraged the political class to think that manufacturing and traditional industries were secondary compared to finance in the modern world, they made The UK government their "bitch": with the financial sector the main thing propping up The UK, there is little else left to keep the country running - it runs mainly on deluded self-confidence, and reliance on the wisdom (and mercy) of the financial oligarchy.
This is how the world works in the 21st century: governments worldwide effectively blackmailed by a group of differing cartels, whose only loyalty is to themselves and the increase in their share price.
Cartels are most famous in crime, such as the drugs cartels that exist in Columbia, and more recently in Mexico.
But they exist in almost every major aspect of the private sector; drugs is simply a more infamous example.
An article here provides a chart that explains how ten (multinational) companies produce almost everything that we buy.
Pharmaceuticals are produced by a small number (i.e cartel) of "Big Pharma" companies, the results of which have been examined in a book of the same name.
"Big Oil" has become amalgamated into an ever decreasing number of mega-corporations: ExxonMobil (as the result of a merger in the late nineties), BP, Chevron, Conoco Phillips and Shell are the main ones in the West. The mergers that happened in the nineties and earlier were partially a result of the entrenchment of nationalised oil companies that previously were in the clutches of Western multinationals. Since that time, Western oil companies have entrenched themselves by expanding into previously uncharted territory; exploring shale gas and oil sands due to advances in technology.
Before the oil crisis of the early seventies, the so called "Seven Sisters" produced the vast majority of the world's oil. The advances of "Big Oil" into new forms of oil and gas exploration are also a result of the rise of the "New Seven Sisters", which are effectively nationalised industries of various developing and non-Western nations. In other words, while in the West oil is concentrated into the hands of a handful of private corporations, in the "East", it is consolidated into the hands of government through government-ran oil companies.
And over all this is OPEC, which itself is a cartel (or oligarchy) of nations that has huge influence over the price of oil.
Technology is another area dominated by a small number of companies. Computer software is dominated by Microsoft and Apple. Other domestic technology (TVs, stereos) is dominated by Far Eastern companies; "White Goods", to a lesser extent also.
Multinationals are everywhere. A telling story is when the former head of ExxonMobil in the nineties quickly put down another colleague for calling them an "American" company. ExxonMobil wasn't an "American" company as far as the CEO was concerned; it was a global one , and as such, owed no loyalty to any one nation.
The nature of the market
But the creation of an oligarchy/cartel is even more frighteningly evident in finance. In the Victorian era, there were hundreds of banks across every major developed nation in the world. The USA and The UK are the best examples of this. But since that time, and from every major economic downturn or depression, banks have either gone under or been bought out.
Each time this has happened, the power to control finance has fell into a smaller and smaller number of private banks; so that by the time of financial crisis of 2008, there are only a bare handful of banks that control much of the world's finance, Goldman Sachs being perhaps the biggest. BearStearns' sale to JP MorganChase in March 2008 was the precursor to the panic following the bankruptcy of Lehman Brothers in September. Following from this, other banks merged to consolidate assets, and the creation of the concept of them being "too big to fail", necessitating the infamous bailout out of the public purse.
The acceptance of the "too big to fail" cartel (TBTF) effectively legitimized the concept of "Corporate Socialism": one rule for the rich, another for the poor. It meant that national governments effectively accepted control of the world economy was no longer in their hands, but in that of the cartel of international investment banks.
In the five years since that event, the cartels of finance, of oil, and of foodstuffs have presided over a collapse of living standards in the West, especially in the economies of Southern Europe, and parts of The USA and The UK. Costs of living have increased year after year, while governments freeze wages and spending in order to repair the damage done by the banks from the financial crisis.
Cartels are the enemy of freedom; they are as dangerous now as they were when the ancient Greeks talked of an "oligarchy" in the time of Plato and Socrates. But cartels are a natural result of neo-liberal economics. While Ayn Rand and the Chicago School of economics argued that free market Capitalism would naturally result in more choice for the consumer and therefore lower prices, the result has been the opposite in the long-run.
In the dog-eat-dog world of free market liberalism, when applied on a global scale (creating "Globalisation") the result is that this creates larger and larger companies that literally eat up their rivals (through mergers), while killing off the competition. Because small companies cannot possibly hope to compete fairly in such an environment, the result is a lack of choice for the consumer, or price-fixing. The Libor rate scandal in the financial industry, the role of OPEC in the oil industry, and the various tariffs and subsidies set up against the interests of the developing world, are a testament to that.
Only a handful of huge companies can most efficiently operate as pan-national entities in order to find the cheapest methods of production for the greatest profit. This therefore has the effect of depressing wages overall, while increasing the share value of the companies themselves, and massively boosting the incomes of the fractional percentile at the top. This may sound quite a lot like Marxist theory, but it is the reality today.
In this way, cartels are a natural result of free market Capitalism. When applied on a global scale, you simply get a global cartel, independent of government control: independent of accountability, and in control of the global supply chain.
How to blackmail the government
The history of the last hundred years or so has seen a gradual breaking down of the power of the nation-state, and a transfer of power to ever-larger multinational cartels of private companies. In effect, this is a transfer of accountability from governments ultimately accountable to their electorate, to private companies only accountable to their shareholders.
Because modern-day multinationals are trans-national entities, laws from individual governments hold less and less authority. In the end, the multinational can always up sticks and transfer operations to nation with a more amenable government; this is how globalisation works.
In this way, "government" in the 21st century has become less and less relevant to everyday life, as private multinationals (often working as part of an informal cartel or oligarchy) dictate much of what happens. Governments have become beholden to the interests of "big business" because they hold fewer and fewer means to hold these private oligarchies to account. In the end, a powerful private corporation can always threaten a dissatisfied government with economic blackmail: "what are you going to do if we leave the country?", the multinational can say. "Where will you get your revenue and jobs from?".
This is what happens around the world, and has happened as recently as the financial crisis when then banks were asking for help from government. In the end, such as in The UK, there was always the threat to take their business elsewhere. After the financial sector had encouraged the political class to think that manufacturing and traditional industries were secondary compared to finance in the modern world, they made The UK government their "bitch": with the financial sector the main thing propping up The UK, there is little else left to keep the country running - it runs mainly on deluded self-confidence, and reliance on the wisdom (and mercy) of the financial oligarchy.
This is how the world works in the 21st century: governments worldwide effectively blackmailed by a group of differing cartels, whose only loyalty is to themselves and the increase in their share price.
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