by das monde
Mon Aug 15th, 2011 at 09:15:37 PM EST
Without much preface, I will turn here on two articles currently top-headlined at "Asia Times". The authors are Spengler (David P. Goldman) and Chan Akya. The economic commentary of these regular contributors was timely interesting in 2008. But by now their insight and argumentation are reduced to simplistic "National Review"-lite anti-liberal chatter.
Spengler's article is "The people's Ponzi scheme". Here is its point:
The story the country awaited from Barack Obama [...] went like this: "This was a disaster, but it was not a natural disaster. It was made by Wall Street gamblers who speculated with your lives and futures. It was made by conservative extremists who told us that if we just eliminated regulations and rewarded greed and recklessness, it would all work out."
The trouble is that "Wall Street gamblers" didn't do the speculating. The American public did. This was a Ponzi scheme by the people, of the people and for the people, the most democratic crony-capitalist scam in the history of humankind. Households made more money than the bankers during every year of the bubble, and ended up better off than they were before the bubble, while the bankers got wiped.
Ri-iii-ght. Millions of households ended up better off, while the bankers got
whipped out painfully wiped. To furnish his thesis, Spengler brings a couple of graphs, like
See, privately owned real estate assets improved and held up much better than bank stocks. Never mind that the real estate wealth was more imaginary than its derivative CDSs - the latter had to be respected no matter what. And the real estate market is still in a stonewalling phase of basic supply-and-demand principles.
In general, Wall Street remained stolidly sanguine about the bubble until it was too late. There were exceptions - Goldman Sachs and the John Paulson hedge fund, among others - who took short positions on subprime. But there had to be a long position on the other side, and the destruction of institutional and personal wealth among the top tier of bankers exceeded the balance-sheet damage to American households.
Let's just say that the top predators got their spoils while most of lower wannabes got hammered. This is a classical class war picture: you feel so good looking down at the crowded masses, while those above look at you with a like contempt. And with George Carlin's quote
The poor are there... just to scare the shit out of the middle class.
we arrive at Akya's article "London riots reduce lies of left to ashes"
What's in the better lie? Akya starts humorously, characterizing a lazy Chinese, an Indian, an African, and then
A lazy European on the other hand, gets to sit at home and watch television while receiving benefits from his government. On his television over the past week, he would have seen unfamiliar scenes...
Then stereotypes of 10-30 years old are just piling up. A whole section is on trashing Keynes - his ghost is on par with Marx's now. You see, all that post-war great moderation
and strong consumer bases have nothing to do with Keynesian policies: it's just
a case of happenstance being confused with causality.
Never mind that the "Third way" and later left
governments have been only pretending in implementing Keynesian economics seriously, and the world is actually on the reverse Milton Friedman's recipes for three decades already - exactly enough to show its true effects. Yep, timing is a problem for Akya's thesis - and a whole section on "why now" does not help his thesis.
Doesn't it look like the Reagan-Thatcher revolution needed the constant growth drug to keep "outperforming" all other economic systems? That its wealth skewing tendencies ran into their logical conclusion of "producer" entitlements amidst mass deprivation? Let us see the common opportunities of the last decades: The young have to work longer hours of their most fruitful years to save for any future plans. They could get a house and high education, but for an increasingly ridiculous debt burden. And if you get something saved, you are supposed to channel it into some stock investment - with only hinted mass-intuitive understanding of its bounties and dangers. Like at a poker table, you are just a fish next to a few sharks. Now your stock and pension savings are drained, house and job lost - and you are a lazy welfare collector.
May I add to Akya's wits an image of a really lazy American? He is sitting on a heap of money just because he was fortunate and lucky to sell a house on the top of the bubble. Or because he happily picked up some defense industry stocks on cheap. Now he earns more sitting on his porch from those stocks than burger flippers working 10 hours a day. And the government pays him more for bonds than "hands out" to several ghetto families. It is not that he is absolutely safe - he is just an ill "investment" away from being disrespected by his new buddies. But the more lazy he is, the longer he will probably live comfortably.
I had mentioned a while ago that the class war is being waged according to all classical warfare cannons. The most prominent strategies are (from Robert Greene's list):
17) Defeat Them in Detail: The Divide and Conquer Strategy. Citing George Carlin again:
That's all the media and the politicians are ever talking about! The things that separate us. Things that make us different from one another. That's the way the ruling class operates in any society. They try to divide the rest of the people. They keep the lower and the middle classes fighting with each other so that they, the rich, can run off with all the fucking money! Fairly simple thing! Happens to work! You know? Anything different! That's what they're gonna talk about race, religion, ethnic and national background, jobs, income, education, social status, sexuality, anything can do, keep us fighting with each other, so that they can keep going to the bank!
33) Sow Uncertainty and Panic Through Acts of Terror: The Chain Reaction Strategy. That is more or less the official US military strategy in Iraq. And that is the perfect strategy of Wall Street behemoths. As Greene's last law of power says: Assume formlessness. The real pressure and power structure is not what it seems - and it is unpredictable.