the economy, stupid

26 September 2008 5:11 PM (economics | class | z)

Modern finance tries as hard as it can to be obtuse, opaque, and unintelligible.

You can even hear this from establishment sources, as they cry out for "transparency in the markets". But still, without active government intervention, transparency is on the decline: nobody knows what is going on in the commodities market, in the securitized bonds market, even in the stock market. Speculators pump and dump. This is the "free market" tendency.

All of this seems to be irrational, an aberration from the "free market" ideals. (The quotations are to indicate that this is a marketing term, that liberty does not necessarily proceed from mercantile exchange.) This fact is a bit strange if you come from an orthodox economic training, such as that which is propagated in the newspapers or in Econ 201 classes across the US.

However, lack of transparency in economic discourse follows directly if you understand economics as a struggle between class interests. It is simply that the explanation that fits best with the facts is too empowering to propagate. Broad understanding of the essentials is not to the advantage of the dominant class in society. Anyone caught discussing class is accused of being corrosive or divisive. You will not find "class" in 7th grade textbooks.

Simply put, a class-based understanding of economics and society has a higher explanatory, expressive, and predictive power than a "free market-based" ideology. Furthermore, it aligns with a moral imperative to abolish class itself.

To me, the moment in which this clicked for me was in college, when an old socialist teaching a sort of russian studies class mentioned that the socialists, the communists, and the anarchists knew that World War I was coming, that they wrote about it, that it was an inevitable consequence of the expansion of finance capital (as opposed to land/agricultural or industrial capital).

When your primary interest is financial capital, you form part of the non-productive economy, of the equestrian class; and capital's imperative being to grow at all costs, you must choose where to invest (not whether to invest). The highest profits have traditionally been found via exploitation (use or utilization, esp. for profit) of the undeveloped world. Rubber from Africa, coffee from Latin America, tea from Asia -- not to mention petroleum.

As Eduardo Galeano notes, capital does not go to Latin America because Latin America is poor -- it goes because Latin America is rich, it goes to exploit, to bleed off the "excess value".

When two sugar-frenzied gunpowder-toting finance-laden World Powers happen to coincide -- well from there we have the detentes, the German South-West Africas, leading to war as an externalization of financial conflict. The losers, of course, are the ones on whose land the fight occurs -- the Hereros, the Balkans, the Iraqis (our armies do not come into your cities and lands as conquerors or enemies, but as liberators).

a return

So, the wine from lunch led me a bit off track. My point is that all real revolutionary analysis and action has taken aim at, among other things, the financial system. Witness the Populists of the 1890s, which gave broad understanding of monetary policy to ordinary people, gave them tools with which to critique the machinations of the Morgans and the Chases. The Wobblies, the anarchists, even the reformers of the 30s knew this.

Now we are at a point where broad understanding of monetary policy is essential -- both understanding of the current situation, and knowing what our options are. There has been some excellent economic analysis in Z Magazine recently, in a series by Jack Rasmus.

I believe that first and the last articles are freely available, but the middle two need at least a free registration and possibly a subscription.

subscribe already mkay

Here's where I get on the stump: If you claim to be a radical, if you want to be a radical, you must subscribe to radical media. It is completely necessary. Z Magazine, for example, is a great one. Its quality varies, but the high points are pretty high. (It took me some time to appreciate the cartoons.)

More importantly, such fora are crucial for getting out the word about important, constructive things happening on the left -- from Parecon to the IVAW Winter Soldier events, to fights for ecologically sustainable patterns of food, transport, and housing, to checking on what's going on in other facets of the movement -- GLBT rights, anti-racism, etc.

Radical media are a crucial point of bridge-building and solidarity between parts of the radical left. Without them, we are left feeling like we are on our own. So subscribe to Z already!

10 responses

  1. Asheesh Laroia says:

    I appreciate your analysis of, well, these two different modes of analysis. Is there a way to read Z Magazine using a feed reader? I wouldn't necessarily mind paying the subscription fee after a few issues convince me that it's worth reading and supporting, but feed reading is the easiest way for me to keep up with inbound text.

  2. Pete Zaitcev says:

    This reminds me one blogger observing: "Lefties absolutely love the crisis. It's like a rupture for Marxists!"

  3. Xan says:

    Great analysis, it's always a pleasure to read your posts.

    Just one question: do you dismiss the "amateur" media as uninteresting and ignore it, or do you simply believe that "professional" paid-for media is always going to provide greater insight and quality but think that both are important.

  4. wingo says:

    Pete: Heh :)

    Asheesh: Doesn't seem that it does have a feed. ZNet itself does seem to have some when you're at the $5/month level, but I don't see how. I think the paper magazine is quite nice though, and has the advantage that you can read it on a train or pass it on to a friend, to make personal connections.

  5. Larry Reaves says:

    Why aren't they looking into something like at

  6. wingo says:

    Xan: Thanks for the kind words!

    Your question is a good one. I think that in the best of worlds the lines between producers would be blurred -- as in free software, we produce and sometimes are paid for it and sometimes are not. In the end, Chomsky is a dilettante, right?

    In the end, media should be a conversation -- people with values, conveying information and feeling and direction. As we speak and listen, as amateurs, we build community as well as conveying information.

    But people with more time to find information and with more training are essential -- you have to be rooted, to exist in a historic space. And for that I'd pay for a speaker to come in, for writers to publish, etc. So both are important, yes.

    I think it's important to put resources toward the kind of world that we want, because the dominant conversation sold back to us from advertising isn't going to provide it.

  7. Xan says:

    wingo: Right, Chomsky is a dilettante, but at least he recognizes that in his books ;)

    More seriously: I agree with you that putting your resources in the hands of people with the time and skills needed to steer the social conversation towards where we want it to be is both good and important. I think my problem is that I have grown to be too suspicious of comercial media because it seems to me that, at this point, it's obvious that there's a fundamental conflict between integrity and objectivity and private/corporate funding.

    Of course Z Magazine and other "user supported" media are not really the same thing than CNN or Fox by any stretch of the imagination, but I think that pushing for some kind of grassroots citizen wiki-like reporting and journalism is as important as giving a few bucks a month to support paid-for "radical" media.

    Just my two cents, in any case.

  8. Maciej Piechotka says:

    1. What we have now is not a free market. One of a most used thing is under controll of a state (i.e. money and central bank). You can call it as you want - state capitalism, state socialism, statism.
    2. The Austrians also warns about the inherit destabilisation - but not of free market but central bank system. So Historicians were not only school which may say it predict it (well - currently everybody said thay had said that it would crash).
    3. The metodological colectivism is at least not very easy to accept. The members of the group usually occupies limited resources so they compete the most betwean themselves. For example in certain cases the employers compete for employees (the real-live situation in Poland). The same basis (well - minues ethics etc.) applies to the evolution. The wolf real enymy is another wolf as it competes for the same resources. Dear vs. wolf on the other hand usually keeps themselves in equilibrium.
    4. About anarchist - althought the 'social' anarchism is rather mainstream it not all of the anarchism movement(I include social in bracets to not imply that it leads to less alienation and/or is more humanitarian). There are some more free-market anarchist - called anarchocapitalist usually as they support the property rights (even there are disussion wheather the Fathers of Anarchy were more 'social' or more free-market). Personally I'm anarchocapitalist - however both with tendencies to paleoanarchocapitalism and agorism.
    5. It is valid belive that on free-market the time-preference of actors adjast. The consumption is the ultimate goal of production (there is no point in production for production). Normally everybody preferes to consume now the same quontity. However the farmer saves some corn to have it grown next year. In this point the corn becomes circulating capital which has been invested - which rise profits.
    6. It is partially true that the robbery is the fastest way of rising profits. If you include all factors (uncertainty, psychology etc.) it may not be as big (count in real profit - the amount of removed uneasiness). Of course - we may differ in defining what is robbery. Is what enterpreneur takes a robbery or the combination of securing the risk-taking, time shifting etc.? In the narrow mean the robbery - as involonary transfer - is not a part of free market.
    To conclude - it is unlikely that anybody changed one's mind. Everybody sais "Haven't I say it?" and the US Gov. will nationalize the industry - probably paying the sufficient amount of money to specific people firstly robbing the taxpayers.

  9. Heather says:

    Though it might be tough to find a bright side during the economic crisis at hand, this blog post gives some good tips for using this as an opportunity for positive change. Dr. Toni Galardi coined this as a “LifeQuake™” and talks about looking on the bright side – i.e, no money to dine out means more meals spent at home with the family and downsizing to a smaller house means living in closer quarters and getting to know your loved ones better. Check it out for inspiration:

  10. Carlos Alberto says:

    It would have been nice to talk about these issues while staying in Barcelona last year ;-) Anyway, very interesting post. Sometimes I forgot these important things.

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