GUT#5: The Philosophy Refugee

 

‘The English have all the material requisites for the revolution. What they lack is the spirit of generalization and revolutionary ardour.’

 

Marx waged war on classical German philosophy and failed. He failed because he could not claim to be inheritor of the western tradition and its destroyer at the same time. That method of attack; infiltration and then rebellion, had been open to Luther in his assault on the Catholic church, but not open to Marx; Hegel had seen to that through his development of dialectics.

 

German philosophy (civilisation), learned a lesson from the fate of the Catholic church in the German Reformation and was ready and armed for the day when Marx or another like him emerged. Marx, who saw himself as the ultimate anticipator, had been anticipated by Hegel. The newly emergent political economy as practiced by Smith and Ricardo was not so prepared and payed the price accordingly; it was overrun and devastated by Marxism. Failure in the field of philosophy and success in the field of economic theory defines the nature of Marxism and the relationship between Marxism and capitalist society.

 

Marx set political economy a trap from which it could not escape; a running noose that progressively tightened the more the victim struggled.  Hegel did the same with Marx. Should Marx chose to be  revolutionary, he would be forced to accept the arbitrary nature of power undermining the idea of inevitable historical progress he was advocating.  Although he liked to think of himself as Lucifer in the Abrahamic tradition, Marx is more like ‘Thor’ the German ‘god’ of thunder whose power mainly consists of a form of ‘Sturm und Drang’ – sound and fury ultimately signifying nothing. Every moment across the earth’s atmosphere there are countless micro electrical discharges from air to earth, returning the air to equilibrium charge. In the same way every time one of countless choices or accommodations is made by ‘proletarian’ or ‘capitalist’, Marxism is grounded by a force it cannot account for. A charge builds up and is then dissipated. Every so often a major lightning strike does occur, but these are rare and only a danger to anything that gets between charge and earth. Mostly these electrical storms only serve to frighten children.

 

This comparison between Lucifer and Thor is instructive. It was central to Marx’s conception of himself and his project that he would  lead opposition forces – i.e. be Lucifer, with all other socialist variants subordinate to Marxism after the form of ‘Paradise Lost’. This struggle to dominate opposition would characterise much of the explicitly political activity that Marx and Engels undertook  in the years in which they engaged in active organisation of workers movements. But as Thor is merely one of many German ‘gods’, so Marx is one of a pantheon of 19th^C revolutionaries, one whose main job was to scare with lightning and thunder while others sought to pursue a quieter course. Marxism fitted into a niche within Germanic socialism as a whole- as the extreme that less radical elements could use to prompt concessions from bosses and governments and with which bosses could scare workers. Again we return to the idea of Marxism itself being  co-opted, and leveraged in a way that Marx was not able to control. The idea that workers, trades union leaders, churchmen and even finally capitalists could choose to pick up or lay down Marxist thought and rhetoric as it suited them, never seemed to seriously occur to Marx.

 

But again, this is not to deny that where Marxism is blocked in the philosophical sphere it rebounds with double the destructive force against political economy.  Despite his philosophical shortcomings, Marx was if anything, a victim of his own intellectual success in the field of economics. Marx saw modern industrial capitalism emerging from the womb, saw the defect on its face at the moment of  birth, and realised that the significance of this inherent deformity was that it presaged the inevitability of capitalism’s death, even if Marx could not predict the time and place. And it was not just capitalism itself but one hundred disciplines born out of capitalism that Marx cursed. Sociology, Psychology, Economics, Criminology, were  all doomed in the crib  by Marx, like the Bad Fairy in Sleeping Beauty.  If this is true , how did this curse have power? What was the nature of that power? Where did this power come from?

 

Marxism is flawed in the sense that it does not belong to mainstream western tradition at all. It is more in the tradition of  Diogenes and Socrates, which like ‘democracy’ are claimed by the western mainstream tradition in name but denied in action.  Marx’s rhetorical devices are Zen like koans whose purpose is to short circuit thought (philosophy), and lead to action.  This shrinking of the philosophical horizon to the impetus for action is fundamental to the revolutionary impulse. In a similar vein, in his ‘Meditations’ Marcus Aurelius’ Stoic philosophy  reduces the essence of man’s conscious perspective to the span of a fraction of a fraction of a second because the Stoicism he advocated  finds no consolation in the past and no hope in the future.  All Stoics have is the moment they are in and the same applied to Marx. His purpose was to maintain balance over the abyss between revolutionary antithesis and post revolutionary synthesis. In the same way a tightrope walker uses a pole, Marx used projection into both past and future as a means of giving himself stability.. For a tightrope walker, the longer the pole the better it works to balance the tightrope walker. Through historical materialism, Marx incrementally balanced both distant past and distant future over time only as a means  to stabilise his existence in the present. Marx had no serious interest in the past or the future outside of how they might serve him from one second to another. This is a fundamental insight into Marx and Marxists. They are happy to burn the doors and window frames to heat the house for the week. They are happy to mortgage the gutted building to buy groceries for the day.

 

Analysis of Marx’s philosophy has brought us to consideration of Marx’s material facts, in particular why Marx decided to spend the bulk of his intellectual career in London. Simply put, in philosophical terms Germany could create a Marx but not sustain him. whereas England could sustain a Marx but not create him. Like a tadpole becoming a frog and moving from water to lilly pad, Marx changed internally according to environment and  changed environment according to the dynamic of his personal transformation.

 

Marx’s defeat at the hands of continental philosophy had brought him to London as a philosophy refugee but  it has never been clear by what means Marx could successfully live in London, not least in freedom from the attentions of the British state. Marx’s physical existence in London was characterised by poverty and insecurity. It was only through the sponsorship of Engels that Marx was able to undertake his research. Living in London was not materially advantageous to Marx and it is also clear that London was no more advantageous in terms of the likelihood of revolution occurring there. Anglo Saxons had already clearly emerged as the people in Europe least likely to revolt against the processes that characterised the development of capitalism and the people most likely to compromise with them . In ‘The Condition Of the Working Class in England’ Engels noted the process by which Saxon capitalism was transforming itself through modifying extreme aspects of its development.

 

Despite the fact that there was no imminent danger of revolution, there would surely have been some desire to remove Marx as a supposedly dangerous revolutionary, and if not that at the very least to neutralise any threat he may come to pose. Or if not even that, then to make him serve the interests of the British state either actively or passively.  Since Marx was allowed to remain  unmolested we can deduce that the British state clearly felt there was no threat in Marx or saw a positive advantage in having Marx in the capital city of England.  We can reasonably draw the conclusion that at some level Marx served the interest of England against the interest of Germany in that England felt it had nothing to fear from Marx’s philosophy whereas it felt Germany had.  Germany was increasingly seen by the English state and elite  as a competing  and potentially dangerous foreign power, but one whose potential weakness for continental radicalism presented both danger and opportunity for England. And here is the kind of irony and humour that Marx would appreciate.

 

Marx came to England precisely because no-one understood philosophy there. Nobody in England even understood the significance of philosophy.  Because no-one understood philosophy in England, no-one understood how Marx had been already been defeated by classic German philosophy by the time he got to London. In as far as they took him at his word, the English elite accepted to a greater or lesser extent the nature and  extent of the threat that Marx could pose to the emerging German power. They were happy to have Marx in London on the basis that he could provide advantage to them  with regard to destabilising Germany and posed no significant threat to the stability of England. But in fact the exact opposite was true. In actual fact Marx posed no threat to the German elite and every threat to the Saxons…

Don’t Let The Good Be The Enemy Of The Goods

The customer is always wrong…

 

The following appeared in an article in the Indepenent:

German supermarket empties shelves of foreign-made goods to make a point about racism Will Worley Thursday 24 August 2017

 

A German supermarket has emptied its shelves in an effort to make a point about racism and diversity. The Edeka store in Hamburg removed foreign-made products from its stock, replacing them with sign bearing anti-xenophobia slogans. It is believed the move will be followed be a larger campaign from Edeka, the largest supermarket chain in Germany. Surprised shoppers entered the store to find that much of the normal selection was gone, demonstrating how reliant they are on other countries for everyday products. Instead, they were greeted with signs saying: “This shelf is pretty boring without diversity.”

http://www.independent.co.uk/news/world/europe/edeka-german-supermarket-empty-shelves-racism-diversity-largest-chain-a7908551.html

Just to make it clear if the article itself is not obvious enough: This shop in Germany no longer sells capitalist ‘goods’ as we have understood them. In fact it has removed ‘goods’ from it’s shelves in order that we might more clearly see what it is actually selling; that we might more clearly see what it’s shelves are now actually stacked with.

This shop has stacked it’s shelves with, and is now selling Good, (as opposed to ‘goods’).

And since it is actually selling Good as opposed to ‘goods’ it follows that the accounting conventions that have previously applied to the sale of ‘goods’ (such as selling at a profit) no longer apply. It follows from this that the objective of this enterprise is no longer that patrons leave the premises satisfied to a greater or lesser extent with the purchases they have made, but rather that they should leave the premises suitably EDUCATED or IMPROVED.

In this particular instance achieving this objective will take the form of the customer leaving WITHOUT the ‘goods’ they entered the premises for, but WITH a clear sense of having been educated and/or improved. In fact, customers are educated and improved precisely to the extent that they leave without the ‘goods’ they envisioned purchasing. Presumably the idea is that they return home and spend the time they would have spent consuming the goods they had obtained, contemplating the benefits of DIVERSITY.

Of course the business not only forgoes the profit that would have come from this day’s trading but also undergoes the additional expense and inconvenience of restocking the shelves after having to de-stock the shelves and store all the produce somewhere while making the point they are making..

And presumably should one or more patrons choose to object to the process and subsequently decide to shop somewhere else, well the loss of revenue is apparently acceptable to this business. Because if customers don’t want to be educated and improved about the benefits of diversity and other things while shopping, then frankly we would rather do without their custom.

After contemplating the picture above for a while, a comparison with the shelves of the Cold War Eastern Bloc and assorted command economies rises to the mind. We were assured repeatedly that it was the abundant provision of consumer goods that proved the superiority of the capitalist model over the command model and resulted in the end of the Cold War.

And yet somehow here we are seeing those self same scantily stocked shelves making an appearance in the supposedly victorious west. And the fact that these shelves are empty is a matter of conscious decision, not any failure in management. What gives?

The fact is that everybody is more or less sick of consumerism, which is another word for capitalist manufactured crap. From cheap nasty food high in sugar and fat, to an endless myriad of plastic novelties manufactured by slave labour in the Far East, it has become impossible to avoid the simple observation that 99.9% of everything created by capitalism is useless crap. And that other 0.1%? That’s the stuff you can’t afford…. so what’s new?

Well, what’s new is that now even the capitalists themselves are starting to get sick of it. They just can’t find a reason to get themselves out of bed and drag themselves into work in the morning anymore. Except..maybe, if they could use capitalism as a vehicle to propagate a message.

Seriously.

Advertising used to be creating ideas to sell you stuff. From now on it’s going to be creating stuff to sell you ideas..

Yet more proof that free market capitalism is well and truly dead.

Oh, and pick me up a pint of diversity on your way back from town will you?

 

 

 

 

Unscrambled Eggs 3 Or All The Kings Men Or A Stitch In Time Or You Can’t Make.. Or Asteroid! Or The Real Crackernomics

 

 

 

In the first part of this series I briefly outlined how the Germanic cult of Capitalism redefined the relationship between the person and the state. Fundamentally this redefinition meant that the sole valid legal and moral relationship an individual could have to society would be to the nation state and not local community or supra national church. This was effectively nothing less than the legal abolition of voluntary community in NW Eurasia.  Capitalism is defined in large part by the fact that no-one, outside of a tiny elite, is allowed to decide who they live with and under what rules. This is Germanic Land Democracy;  the elite forms a Land Republic the rest are the land slaves.

 

In tandem and in consequence to this legal putsch the economic needs of capitalism incrementally developed an unstable and mobile workforce.  Communities that had lost their link to the land, their independence, would be forced to go wherever the work was, even to the extent of destroying inter generational family structures. Family, by ideological necessity, was ordained as evil. ‘Workers’ were elevated by capitalism  to a position where they did not even have access to water to drink unless provided by the emergent nation state.

 

The newly ordained priests of Protestant Capitalism preached that this EXTREME state of affairs could only be negotiated through the ‘Free Market’, which was of necessity magical in the extent of the powers it would have to overcome these problems. But effectively this was accepting and then promoting an unending state of PERMANENT CRISIS, something that Marx intuitively understood. Capitalism IS a state of permanent crisis- this is the single most important insight you can have into it’s political structures. Capitalist democracy is effectively a never ending series of emergency meetings-  of chaotic shouting and gesturing taking place in stock markets and bond sales as well as in the seat of government.

Let’s party!

The new workforce was unstable and mobile; given identity by theoretically owning collectively a geographic area- the nation state- but not allowed to actually own any of that very thing that gave their existence meaning! As a consequence Germanic culture spawned the modern political party  as a Frankenstein’s monster of geographic representation and ‘ economic’ necessity stitched together; constantly torn between its supposed constitutional identity and the reality of the system it represents. Nowhere is this clearer that in the case of economic nationalism. To protect the national economy it is necessary to deny the ‘Free Market’ and international trade! The two foundational concepts of capitalism are fundamentally opposed to each other. Managing this running sore at the heart of Germanic life is the basis for modern Germanic politics and economics.

 

Subject to inevitable periodic disruption, the system staggered on, until as a result of the financial crisis,  the free market suffered virtually total ideological collapse in the west in 2007.  Once the belief in the Free Market as a negotiating mechanism was gone there was no agreed ongoing way to negotiate the state of emergency that I describe above. It has now become an immediate and pressing feature of day to day existence in the Germanic capitalist world. This explains the dynamic that powers all politics and economics in this 21st century; a state of permanent visible crisis that has no agreed mechanism for negotiating a solution.

 

I must underline this central point. The market and capitalist democracy are often described as being supposedly somehow self replicating and self regulating (these are some of the magical qualities ascribed to the Market). And this perspective seems to be valid from the point of view of market cultists. But the reason that the Market reappears and reproduces itself  is exactly and only because the crises that give rise to it are continually replicating and reproducing!!

 

Naomi Klein had a fantastic insight into this process in The Shock Doctrine, in which she described some of the largest and most extreme manifestations of this phenomenon. But Klein failed to understand that the crisis has always been permanent and ongoing every second that capitalism exists. In capitalism every meeting is an emergency meeting. This is the spirit of the age. The critique that capitalism offers of socialism is that it is incapable of creating a crisis management system as effective as capitalism. The criticism of capitalism that socialism offers is that capitalism is incapable of creating an effective crisis management system.

 

Marx understood that the Germanic cult of capitalism was a permanent state of emergency. He also understood that should the sense of forward momentum of capitalism be dulled or even stalled that Capitalism would CEASE TO EXIST in people’s minds in that millisecond. That is the fundamental importance of the cult of ‘Progress’ that obsesses both Germanic left and right. Marx formulated the observation that in the absence of progress:

 

 “A development of the productive forces is the absolutely necessary ….because without it want is generalized, and with want the struggle for necessities begins again, and that means that all the old crap must revive.”

 

The management of capitalism is only considered valid to the extent that it can be shown to be progressing in managing and solving the day to day problems thrown up by the inherent crisis of capitalism itself. The moment this is shown not to be the case, capitalism has an election and puts in a new management team. When there are no viable capitalist management teams available, there is a socialist revolution, which is effectively an outside team of management consultants being drafted in. In detail, the process can be described as:

 

Unless the all encompassing illusion of progress can be maintained , the appearance of socialism reverts to the appearance of capitalism and the appearance of capitalism reverts to the appearance of feudalism. The reversion of the appearance of capitalism to the appearance of feudalism is what we can observe all around us.

 

Think about it and you will understand that under these circumstances the possibility, the promise of stability, either real or illusory, simply cannot exist.

 

So the 24/7 round the clock emergency repair system of the market has broken down and the appearance of feudalism has re-emerged in the west. Great!- Let’s Go Feudal! But we can’t go back to the pre-capitalist system because the link between culture, community and place has been permanently and irrevocably mutilated. Just like a scrambled egg whose yolk and white have been amalgamated there is no way back for the Humpty Dumpty of free market capitalism. And this understanding finally brings us to the meaning and significance of cultural constituencies

 

I initially pointed out that the nation state took over responsibility for morality from Church and Community; a duty to society that would from now on be discharged by the offices of the free market which would decide who would get what, where and when. But now that the market has been shown to fail the question for the populations of NW Eurasia is how to take the responsibility for morality back from the nation state..If you doubt this, you have only to look at the self appointed refugee rescue NGO’s operating in the Mediterranean Sea that have effectively privatised the process of immigration from the third world.

Big Bang

We can describe the problem  of reconstituting morality in this way. A massive asteroid  hits the earth at Chicxulub  68 million years ago and throws millions of tons of  debris high into the air. Over a period of subsequent decades that debris falls to earth, but not just in the place it came from but all over the earth’s surface. The entire globe now has a thin layer of dust that came from one just one place in Eastern Mexico. So the same with the human debris of capitalism. And  instead of one meteorite there is a continuous stream of impacts every hour of every day. So people are exploded up from where they originated into the atmosphere and then land down all over the globe in a variety of stratified layers that are analogous to the ‘classes’ that are said to compose modern society.

The class system..

 

But morality is the link between culture, community and place and it has been permanently and irrevocably mutilated.  So a modern cultural constituency is a cross section of stratified layers trying to act as though it were a cohesive regional community. It is a plate of scrambled eggs trying to remember what it was like to be six eggs in a box…

 

 

 

 

 

Capitalism Doesn’t Add Up Or The Left Hand Doesn’t Know Or When you are Similieing

 

You should familiarise yourself with the law of conservation of matter and the law of conservation of energy.

 

Both of these scientific ‘laws’ express the same basic idea:

 

That the amount of inputs in any given reaction and the amount of outputs from that given reaction, must balance. In other words, every element of a given reaction or process must  be accounted for.

 

Although these ‘laws’ are often characterised as being ‘scientific’ in nature, in fact they come from a much older intellectual tradition; that of Christianity.

 

The entire concept of Christianity is based on two central core principles.

 

The first principle is that any particular incident can only ever occur once and is therefore unique.

 

The second principle is that every incident, process and event that has ever occurred is recorded down to the most infinitesimal detail and that the totality of calculation involving all this detail will be taken to be the final meaning/accounting of everything. Everything can and will be accounted for.

 

These are two foundational concepts that science directly stole from Christianity. (Although scientists would have you believe they ‘created’ them!). Together they make up the philosophy of rational accounting. This philosophy of rational accounting presents a  fundamental problem for the creators and propagandists of the Germanic cult of capitalism.

 

It means that matter or ‘wealth’ cannot be created or destroyed in the sense of being brought into, or taken out of, any given process or reaction. Everything on the left hand of the equation must be accounted for on the right hand of the equation. If it is missing it is because you failed to account for it.

 

This means that ‘wealth creation’ in the sense of creating something cannot rationally exist. If wealth is present on the right hand of an equation it must have been present on the left hand of the equation.  If wealth creation cannot exist, then ‘wealth creators’ cannot exist. So there cannot be any such thing as capitalism or any justification for capitalism.

 

By way of a simple example:

 

An iron smelting plant is in operation and claims to transform iron ore into usable steel and therefore ‘create wealth’. If we take into account the pollution and destruction of environment involved in the smelting process and we adequately account for this and other left hand costs, we find that in fact this melting plant has not created any wealth or any matter of any kind, but in fact simply transformed parts of the existing environment into something else. No wealth has been created.

 

The trick behind this, is to undervalue the preliminary imports – the land, the environment, the labour et cetera and to correspondingly overvalue the output: the ‘wealth’ that has been created. Turning healthy useful corn into ‘Cheetos’ counts as wealth production!!

 

The Whole World Similies With You

Let us look more closely at the value of inputs, for instance the value of iron ore. The value of any particular portion of iron ore can only be rationally valued in comparison with the total amount of all iron ore.

 

If you were to say that 1 pound of iron ore is as valuable as six eggs you are making a poetic comparison, expressing a SIMILIE not an accurate fact. There is no rational relationship between a lump of iron and an egg and there never can be any rational relationship between a lump of iron and an egg because there is no rational point of comparison.

 

(This is an indicator of the value problem which comprises the third part of my general theory of money. I will return  to this later).

 

There is no rational relationship between a lump of iron and an egg but there is a rational relationship between a lump of iron and the totality of all iron available. We can say that any one piece of iron represents a proportion of all total  iron.

 

If there were 100 tons of iron available on earth, then one ton of iron would represent 1% of all the available iron and this would be its true demonstrable, rational, proportionate value.

 

But this presents an immediate and obvious problem: we have no idea of how much iron is actually available and can only provide a an estimate. It follows that we can only present an estimate of the value of any given piece of iron. Since it is only an estimate, is open to a bit of ‘creative accounting’…

 

But although creative accounting can paper over some of the more obvious gaps in the capitalist fraud, the more intelligent Germans realised that this could not form the basis for a long term strategy.

 

They realised that they were playing a game of cat and mouse they were bound to lose in the end. The longer the game went on,  and the more information that became available, the more clearly people would begin to see that the estimates of value that were given to steel and wheat and air were clearly fraudulent.

 

The more clearly people began to get an idea of the TOTAL amount of any given thing, the more clearly they would realise that the present valuation of it was undervalued and just as importantly  the previous estimates were even more fraudulent!

 

This is the true meaning behind the battle between environmentalism and its opponents…

 

And then Germanic capitalists had a stroke of ‘genius’. Which actually means they simply reverted to their fundamental nature. They decided to turn everything back to front, inside out and upside down.

 

Why wait for the inevitable exposure and condemnation when the accounts became due? Why not instead START with the accounts and work backwards??!! And this is exactly and precisely how capitalism and capitalist democracy was brought into being.

 

A capitalist corporation first produces a final profit and then promises to work towards it. Of course, it usually fails and resolving the consequences  of this failure is called capitalist economics.

 

A capitalist political party first produces a set of intended results and then promises to work towards it. Of course it usually fails and resolving the consequences of this failure is called capitalist politics.

 

But the key advantage of this process, insane as it seems, is that there is no point where the capitalist corporation or the capitalist economic party is actually HELD TO ACCOUNT in the literal sense of the word.

 

Because they persuaded the investors and the voters to endorse the accounts they were given before the process even began. They made you just as culpable as they are.

 

Nine Hundred And Fifty Four, Nine Hundred And Fifty Bloody Five.. Or I Wonder If We Are Ever Gonna Change

 

Underpinning Einstein’s theory of relativity is the philosophical argument that it is both possible and desirable to view a particular event from a multiplicity of points of view to gain a comprehensive understanding of the processes embodied in that event.

 

If this is the case, then it might also be argued that it is both possible and desirable to view any particular historical and economic event from a multiplicity of points of view. This would be as revolutionary a development in economics as Einstein’s theory was in physics.

 

Both classic economics and the Marxist variant, promote a singular subjective perspective on structure and meaning of economic systems. Their purpose, openly stated or covertly implied, is to promote the political, moral and cultural system they are representative of.

 

The formal purpose of capitalist economics is to run the system at its most efficient , it’s covert aim to justify capitalism as the dominant system. The overt purpose of Marxism is to produce a critique of capitalism that will lead to its being abandoned as a consequence of its internal contradictions. Its covert aim is to justify historical attempts to create alternatives to capitalism.

 

In order to work, both capitalist economics and Marxism need a protagonist, an archetypal hero from whose singular perspective we can see the world and whose actions we can subjectively identify with. This is the real identity politics.

 

For capitalists the hero of the story is well ,.. The Capitalist  who daringly risks all to bring wealth up from the depths of the darkness -a variation on the Prometheus narrative. For Marxists the hero of the story is The Worker whose toil in the mines is the real producer of wealth.

 

Effectively, both socialism and capitalism are operatic arias in the Wagnerian mode, with two main characters competing for The Ring of Wealth, claim and counter-claim, war, deception and betrayal all part of the story…

 

In a small accommodation with reality there has been a recognition of this subjective limitation and  attempts to modify both classic and Marxist economics. Keynesianism explicitly criticised classic economy from the perspective that it had no macro economic analysis, that it was limited and partial. Marxism also criticised classical economics from the same perspective.

 

In turn, classical economics responded by broadening the fields of economic activity that it covered and even integrated elements of both Marxism and Keynesianism to produce the modern hybrid that passes for mainstream economics today. At the same time neo liberalism explicitly critiqued Marxist planned economy for offering a limited and distorted perspective on the real world. Only the market was capable of gathering and processing enough information to make the system work it claimed.

 

Classic economics and Marxism have historically attempted to compensate for narrowness of vision by reaching for an ever more comprehensive breadth of subject matter. Their final strategic purpose is to claim that the point of view they represent is capable of encompassing all of experience. In other words, both capitalism and socialism claim to be universal theories.

 

This strategy really amounts to nothing more than a form of semantic  trickery that exploits the confusion between taking something into account and adequately accounting for something. An analysis undertaken on this basis degenerates into nothing more than description in the form of an ever expanding list of complaints that classic economics makes about Marxist economics and Marxism makes about classic economics.

 

But neither capitalist economics or Marxism can overcome the fundamental problem that they are subjective in both analysis and purpose- they are in essence particular points  of view.

 

In the back and forth diatribe of mutual complaint each philosophy implicitly recognises the value and need for the other as each seeks new territory to colonise at the expense of the other. Both competing analyses move from old to new battlefields as they become available for domination,  seeking both to justify their own existence and to nullify the existence of their opponents.

 

This is the operation of a dialectic; the domination of thought through the application of a controlled conflict- a drama- a demi-urge.

 

The last major episode in this opera was the credit crunch. Marxist economics went on the offensive, seeking to gain advantage in this period of capitalism’s distress. In response neo- Classic economy sought to spin events in such a way as to justify itself. Perhaps unsurprisingly classic and Marxist have managed to fight each other to what is effectively a stalemate. Both boxers now winded and bloody, have retired to corners for a chest rub and a pep talk from their respective managers…

 

The central question now is: Do we wish to invite both protagonists back for a further round of conflict? Would there be any purpose, political or intellectual, in continuing a boxing bout that seems to have stalled in mutual exhaustion? If subjective political economy has nowhere left to go, what can emerge to take its place?

 

The economic model I propose does not rely on a representation of any particular group as the main protagonist in history and economy. I don’t seek to make The Capitalist the hero of history or The Worker either. On the contrary I am now arguing that there is no such thing as The Capitalist as a concrete economic agent. There is no such thing as The Worker either. They are both literary inventions of Germanic culture. This is where culture meets economics.

 

Nobody ever in the history of the world ever created capitalist wealth through undertaking risk. Nobody ever in the history of the world ever created capitalist wealth through undertaking labour. Both these ideas are literary fictions.

 

Instead I am arguing that the only way that capitalist wealth is created is that it is extracted and accrued through the operation of money forms, that is denuded versions of money. These money forms create and operate their own distribution networks within society and economy that allow the extraction of wealth.

 

Individual or group economic power and significance comes from the extent to which one has access to one or more money forms and is able to utilise them to extract wealth.

 

This analysis seeks to represent Germanic capitalism from a multiplicity of perspectives to show both action and reaction in any given transaction. We no longer need to be bound to this or that heroic perspective or this or that litany of complaint and counter-complaint.

 

But there is a price to be paid for this insight. Because in such a model the struggle for economic power becomes a zero sum game. Power is fixed in quantity and quality. If power accrues to one then it necessarily is taken from to another. Wealth cannot be created as in a Germanic literary fantasy.

 

Just as Einstein’s theory was able to capture the multiplicity of relative motion through the adoption of a constant the speed of light so this model of money requires a constant  – that of wealth. Wealth in this model is not created, that is the absolute barrier that cannot be broken through.

 

E=MC Too

 

 

The American health care system clearly needs to be rationalised. It is inefficient, with multiple competing bureaucracies, high costs and poor outcomes. many people cannot understand how it has continued to develop in what appears to be such a dysfunctional way.

 

But what if the size and shape of American health care is entirely rational if you understand the parameters that it operates within?

 

In my general theory of money I argue that the fundamental structure of capitalist economies is a broad alliance of competing money forms, (partial money), that act as a means of extracting wealth from society as a whole for their respective constituencies and through this process money forms divide up the economy.

 

Under this model INSURANCE is a money form, whose purpose is to allow its issuers and users (constituency) to extract wealth protected by its representatives among the elite: FACTIONINSURANCE.

 

You might imagine that because ‘healthcare’ is the subject of insurance that ‘health’ is somehow integral to this insurance business. It is not. ‘Health’ is no more integral to health insurance than birds are integral to ‘Dove’ shower creme.

 

To make it absolutely clear: ‘Insurance’ does not exist as a consequence of the social need for ‘Healthcare’ rather ‘Healthcare’ exists as a consequence of the economic need for ‘Insurance’. Who has an economic need for insurance? The faction that creates, buys, sells and uses it.

 

An easy way to understand it is to look back at the development of both rail and then car travel. First trains were invented and then the marketing department for the rail companies had to think of somewhere desirable to go on them. The same applies to the motor car. First the car was invented and then a desirable destination had to be invented. In this way first the ‘seaside’ and then the ‘countryside’ were invented…as well as the suburbs.

 

Insurance was invented as a money form. Then the insurers had to find something desirable to insure- enter healthcare.

 

I will build on this insight:

 

There are a number of competing money factions of which FACTIONINSURANCE is one and FACTIONDERIVATIVE is another; the latest edition to the elite power structure.

 

I have previously explained how QE was specifically an economic and political arrangement to protect and regularise emergent derivatives in the wake of the crash they caused.

 

If we accept that there are a number of money factions competing for economic and political primacy and we accept that derivatives have been inducted into the elite club, we can surmise that the derivative share of power must have been allocated at the expense of another competing money faction.

 

In other words someone must have been made to move over to make room for derivatives at the money table. Which brings us to the following intriguing anomaly:

 

In both Britain and America the newly elected post credit crunch administrations undertook ambitious and far ranging ‘reforms’ of their respective health care systems, despite the fact that many observers noted that the administrations had far more pressing concerns that they appeared reluctant to confront.

 

It does seem odd that a Conservative a government in Britain and a Democrat government in America should go out of their way to look for trouble when they had so much of it already.

 

But what if, in line with my model, they had to rejig the position of FACTIONINSURANCE within the system as a whole to accommodate FACTIONDERIVATIVE?

 

To put it another way, to get the support of FACTIONINSURANCE they had to get something in return for what they were losing to FACTIONDERIVATIVE

 

Then the actions of both Anglo Saxon elites would entirely make sense.’ Healthcare reform’ can now be seen for what it is- a central ECONOMIC part of the QE programme.

 

If my model of how the system operates is correct- how would that be reflected in what we actually observe? We would expect to see an increase in health insurance without a corresponding increase in health. Sound familiar?

 

All of which brings me to my E=MC² moment. This is a simple formulation which is the basis for explaining all economic and political history over the past hundred years. It supersedes and clarifies all other economic theory. (Is that all, Andy ?)

 

Among other startling things my theory makes it possible to calculate to 2 decimal places the Socialism of any individual in comparison to any other individual on the planet.

 

The Credit Crunch and subsequent QE heralded the formal acceptance of derivatives into the elite money pantheon.

 

I explained how FACTIONINSURANCE got paid off to allow this to go ahead. But what about FACTIONEQUITY, FACTIONBOND etc?

 

Well they all got paid off too. In fact everybody seems to have got paid off, except one faction, and you know who that is don’t you?

 

Yup,

 

FACTIONCASH got shafted on all sides.

 

And what happened as FACTIONCASH had its political and economic power stripped away?

 

Why, Socialism evaporated into the air as though it had never existed!!

 

Surely this is the time above all others when people would have turned to Socialism. But they can’t turn to socialism because it doesn’t exist as a real separate political force.

 

Which leads me to my central formulation:

 

CASH=SOCIALISM

SOCIALISM=CASH

 

Want to know exactly to two decimal places how socialist any particular person is?

 

Find out what percentage of their wealth is held in cash and how much cash  they carry around..

 

I have prepared the following graphic for you to approximate just how Socialist you and your friends and colleagues are…

 

If you doubt my analysis ask yourself:

 

What would the world be like if there was only one money form and it was cash?

Socialism, no?

 

Why were elites all over the Saxon Axis so desperate to get welfare recipients onto digital payments?

 

Because it is bad enough if some members of society are socialist, but it really would be too much if the poor were as well…

Crackernomics General Theory Of Money Part 1

I have been working towards finishing Crackernomics 2: The Structure Of Money for a couple of years.

 

When I first began writing about the credit crunch in 2010 I described the form of the crisis and recovery process the same way one might describe the appearance of a conjurors illusion without actually understanding how the trick works. I had the form of what was happening but not the underlying content.

 

After further observation I began to realise the significance of the specific case of derivatives- that they were in fact a form of money and that QE had the overall purpose of regulating and guaranteeing them as such.

 

Over the next year or so I extended this understanding of money issuance with my analysis of Bitcoin and other crypto currencies.

 

However, it turned out to be another six years or so before I understood the general rule and I could produce a comprehensive general analysis and monetary theory…There are two parts to the general theory.

 

Here are the bones of the first half of that General Money Theory.

 

Under the cult of Capitalism the state has an effective political monopoly on the creation of money.

This leads people to erroneously presume that since there is only one state operating within each nation state territory that each individual state only allows the production of one kind of money.

 

In fact capitalist states directly and indirectly sponsor various types of privately issued money including bonds, equities and some forms of insurance. State sponsorship of these other forms of money takes the form of guarantees and regulation. These sponsored other forms of money allow the extraction of wealth from and the regulation of, the capitalist economy.

 

In the nineties one faction within the American state began to sponsor and promote a new form of privately issued money. This form became generally known as derivatives. Because of the scale and novelty of this form of money issuance it inevitably led to destabilisation and a crisis that is referred to as the Credit Crunch.

 

The broad idea is the same as the CIA, Kennedy and the Bay of Pigs. The CIA started a crisis by invading Cuba and then tried to force Kennedy to back them up. Kennedy refused and you know what happened as a consequence.

 

In the immediate aftermath of the credit crunch Bush and Obama accepted the fait accompli offered to them by the derivatives faction and used the state to back up the new form of privately issued money.

 

Under the cult of capitalism Germanic elites established an effective political monopoly over the production of money BUT actually produce more than one kind of money through the sponsorship of bonds, equities, forms of insurance and unmentioned till now; BANK CREDIT which leads to the following central idea:

 

The history of money production under Capitalism follows this pattern:

 

A particular political/economic faction in a given society petitions to join the elite and create its own form of money.

 

It begins to manufacture and use this form of money.

 

The production of this novel form of money creates a social and economic crisis.

 

The existing elite either agrees to accept the new form of money and collectively guarantee and regulate it or it does not.

 

This is how paper cash came to be a form of money- crisis and then acceptance

This is how insurance came to be a form of money- crisis and then acceptance.

This is how bonds came to be accepted crisis and then acceptance

This is how equities came to be accepted -crisis and then acceptance

This is how bank credit came to be accepted crisis and then acceptance

 

THIS IS HOW DERIVATIVES ARE COMING TO BE ACCEPTED -CRISIS AND THEN ACCEPTANCE.

What do we call this process of collective acceptance of derivatives; their regulation and guarantee by the elite?

 

We call it QE.

 

Sometimes this process fails. The Dutch tulip bubble is a good example. The tulip faction failed to get bulbs accepted as a form of currency!!

 

Here is a fundamental insight:

When a faction bid to create a new form of currency fails it is referred to pejoratively as a bubble. The wealth accrued to that new form of currency is redistributed among its competitor currencies.

 

The Significance of Gold

 

The creation of the Federal Reserve was the crisis and acceptance of bank credit as a sponsored money form.

The Wall Street Crash and its resolution was crisis and acceptance of equities as a sponsored money form but;

 

But the withdrawal of the gold standard was EXACTLY THIS PROCESS IN REVERSE. The original and founding member faction- the GOLD MONEY FACTION was blackballed and EXCOMMUNICATED from the Germanic money elite like the founding CEO of a company being turfed out by other board members!!

 

This is the significance of going off the gold standard. The original founding faction reduced to penury and obscurity, the plaything of the very factions that it originally allowed into the gang!!

 

There are money factions operating within Germanic societies which sometimes successfully petition and join the elite. But the end of the gold standard was historically unique in the history of capitalism since it was the first time a money faction was DE-LISTED and DELEGITIMISED.

 

Next we can identify the money factions. The basic money factions at present are

 

FactionInsurance

FactionBond

Faction Credit

FactionEquity

FactionDerivative

and last but not least ,(not yet anyway),

Factioncash (which is supposed to be the pre-eminent faction but we all know about the war on cash).

 

After some consideration I believe there is only room for a LIMITED NUMBER OF FACTIONS at the top table.

 

Here is my prediction:

 

It is very possible that FactionInsurance or FactionBond will be delegitimised and expelled by Trump in this administration just like Nixon did to Factiongold!! (Actually on further consideration I think it might very well be Factioncash that is for the high jump..)

 

Notes On Factioncrypto

 

Presenters of The Keiser Report Max Keiser and Stacy Herbert are good exemplars of Factioncrypto. They are Pro gold-Anti derivatives- Pro Bitcoin because:

 

They want the  FactionGold to be re-admitted to the monetary elite but this is not going to happen. (I suspect they know this and their support for Factiongold is only rhetorical.)

 

They want to prevent the legal and political legitimisation of derivatives and Factionderivative, which is why they always refer to derivatives as ‘fraud’. But derivatives are more or less entirely legitimised. Only a major overturn can prevent the successful finalisation of this process.

 

Factioncrypto want Bitcoin to be accepted as part of the Germanic money elite. But to do this they have to do what every petitioning faction has done before them- they have to use MONETARY TERRORISM tactics- just as they rightly accuse the derivatives faction of doing.. to provoke a crisis, then bargain for acceptance and regulation.

 

How this general theory of money can explain Real political parties

 

I have argued that the actual history of politics and economy is not a duopoly/dichotomy of left or right or working class or capitalist or nationalist and globalist but rather a number of competing factions that use money forms to extract wealth and regulate and divide up the economy. This is the true underlying form of politics under capitalism.

 

But we can take this further and argue that each faction has its supporters in wider society and that this is the actual way we can understand how society is divided up and operates. Each faction has a broader money constituency within society that supports it. This constituency uses their specific money form to extract wealth from the general economy.

 

 

Factioncash has a corresponding cash constituency. Factioncash is the REAL PARTY of Cash constituency.

 

Factioncredit has a corresponding credit constituency  Factioncredit is the REAL PARTY of Credit constituency.

 

Factionbond has a corresponding bond constituency  Factionbond is the REAL PARTY of bond constituency.

 

Factionequity has a corresponding equity constituency Factionequity is the REAL PARTY of equity constituency.

 

FactionInsurance has a corresponding insurance constituency  FactionInsurance is the REAL PARTY of insurance constituency.

 

Factionderivative has a corresponding derivative constituency Factionderivative is the REAL PARTY of derivative constituency.

 

Factiongold has a corresponding gold constituency  .Factiongold is the REAL PARTY of gold constituency.

 

Factioncrypto has a corresponding crypto constituency  Factioncrypto is the REAL PARTY of crypto constituency.

Actual political identity; that which determines what any individual or group within capitalism will do is determined by the form of money each faction uses.

 

From this we can observe that some factions have a greater or lesser constituency than others to the extent that some constituencies have little or no faction representing them in the elite and some factions have little or no constituency on the ground.

 

This exactly and specifically determines how each faction/constituency will act politically. It means we can begin to predict with an unprecedented  degree of precision what each grouping will do.

 

These degrees of constituency can be arranged and compared in a PERIODIC TABLE OF MONETARY FORMS.

 

We can draw an analogy with the model of an atom. Factions represent the nucleus and constituencies represent the electron configuration outside the nucleus. CONSTITUENCIES therefore influence the relatively trivial domain- the physics and chemistry of the economy and factions influence the profound- the atomic power of the economy.

 

While the specific balance of components varies from nation state to nation state the basic relationship can be described thus

 

From top to bottom these are the money forms with the largest real parties (constituencies)

 

(Largest constituency):

 

FactionInsurance

Faction Credit

Factioncash

FactionEquity

FactionBond

FactionDerivative

FactionCrypto

 

(Smallest constituency)

 

I will apply my model to two well known historical anomalies to illustrate how effective it is:

 

The mystery collapse of ‘left wing’ working class politics and

 

The mystery of Quantitive Easing:

 

1:The mystery collapse of ‘left wing’ ‘working class’ politics

 

Each monetary faction has a constituency. This is the real nature of societal division. In Britain up until the 1980’s the vast majority of what is called the ‘working class’ were represented by Factioncash and were therefore members of Cashconstitiuency. They were paid in cash. They purchased in cash. They lent and borrowed in cash. They relied on cash as the means to extract their share of society’s wealth.

 

But as you know in from the 1980’s through massive economic reprogramming the majority of ‘working class’ was forcibly transferred from Factioncash to Factioncredit. They were relocated in Creditconstituency. And so their priorities and allegiances accordingly changed.They were paid in credit. They purchased on credit. They lent and borrowed in credit. They relied on credit as the means to extract their share of society’s wealth.

 

It is this which explains the collapse of ‘working class’ left wing politics. In essence it was the forcible transfer of political allegiance of the ‘working class’ from Factioncash to Factioncredit.

 

The mystery of Quantitive Easing

 

We are familiar with the immediate aftermath of the initial credit crunch. There were a number of meetings between Obama and the bankers. The story goes that the bankers issued Obama with an ultimatum: back us and back derivatives or we will bring the system down. Why did the administration go along with this demand? Was it because they are all Wall Street stooges etc?

 

Consider the reality of the situation from a faction perspective.

 

Derivativeconstiuency (DerC) was effectively bankrupt. That ‘s what the Credit Crunch crisis was effectively all about; are derivatives to be accepted and protected or are they to be refused protection are therefore be deemed to be worthless – a bubble?

 

Factionderivative (FacD) the political representatives of DerC went to bat in a do or die situation. But this was not something new it had been the same for every successful faction since capitalism began.

 

And FacD had an ace in the hole. The administration was Monetarist and as you probably know Monetarists ABSOLUTELY HATE cash more than anything else on the planet. So the FacD play was simple: Let’s use this opportunity to get together to f*ck cash for once and for all. That was the true nature of the play. And it has worked. Derivatives were preserved at the expense of cash.

 

Authors note:

I know this is all a bit scrappy and in semi-note form but it is covering a lot of territory and I want to get as much of it as possible down as quickly as possible. I will return to the themes and ideas I have outlined here at a later date.

By the way I am in the faction of the one in whose image I am created

Half a Sixpence Or Wiggle Room Or Everything’s Small In America Or Discover The Power Of TV Advertising

When I first began writing about the Credit Crunch and its consequences  I said that the defining moment in this cycle will come when the decision is made to re-introduce aspects of the pre-Monetarist economic system to a greater or lesser extent.

 

I argued that the Credit Crunch was not a ‘natural’ crisis in the sense that it arose out of production and trade processes like previous crises in the last century. I described how the Credit Crunch was instead the consequence of the solution implemented to combat inflation and stagnation of the 1970’s. The Credit Crunch was the product of past medicine not contemporary illness.

 

Monetarism was created to cure the problem of inflation, specifically wage inflation, for once and for all. Effectively, it removed the possibility of workers being able to directly influence the economy through collective wage demands. From now on workers as a group would have to accept whatever was offered by the economy instead of visa versa.

 

This was achieved by a combination of suppressing trades unions, dismantling of work place legal rights and the introduction of truly large scale mass immigration. These had the effect of permanently altering the supply of labour available.

 

In tandem with supply side reforms to the labour market Monetarism advocated a move towards a mass credit economy and most crucially the introduction of democratised money through financialisation. This combination of measures in total produced a low-wage, low discretionary spend and low growth economy in the aftermath of the Credit Crunch.

 

To reiterate the point: In the sense that Monetarism was a planned attack on the post war political and economic settlement, the Credit Crunch that followed from it was entirely voluntary and entirely avoidable.

 

But if pundits are to be believed all this is to be overturned- or at least corrected to some extent in a kind of counter reformation to Monetarism. We are told that under Donald Trump America, (and Britain under the Brexit regime), will return to the old style ‘great again’ economy .

 

Inflation will arise from the dead and interest rates will lift in response. We are told that as part of this cycle of cause/effect, real wages will also begin seriously  rising after decades of stagnation.

 

I understand now that my initial analysis of the Credit Crunch was incorrect in that it did not take into account the significance of derivatives and the permanent effect they would have on the global economy. It was only after I began to write about the central bank response to the credit crunch in the form of  Quantitive Easing that I realised that derivatives were entirely novel in the effect they would have on structures within developed economies.

 

Derivatives are a new privately issued form of money. As such, they have colonised sections of global economic activity. As a consequence of this colonisation derivatives  permanently distort the total global economy to the extent that they are allowed to operate within it.

 

The mistake I initially made was not to realise that even if the old world was to some extent allowed to be re-introduced into the new world, it would not be on the same terms as previously. History is one way street. This brings us to the central theme of this piece which is the new shrunken environment into which Donald Trump will birth his new great America.

 

You will probably have heard  of ‘shrinkflation’ in which the packaging of a commodity remains more or less the same but the actual product within the package shrinks. For example look inside a bag of potato crisps and you find it will now be less than a third full- the bag is mostly air. A bar of Toblerone chocolate has famously shrunk to the size of the foothills of Wales instead of the mighty Alps it was supposed to represent.

 

In terms of commodities, the sound of the future seems to be a ‘capitalist rattle’ where shrunken products jiggle around in their oversized packaging. Something similar has happened in the world of politics producing ‘wiggle room’.

 

Wiggle room is the phenomena whereby it becomes increasingly difficult to attribute any given outcome to any particular cause. (See what I have written on the ‘Secret Economy’)

 

I have referred to sawing the lady in half on more than one occasion as a metaphor for the new politics and economics.The key to this trick is understanding that there is a lot more room in the box the lady goes into  than you might suppose. The wiggling fingers and the wiggling toes that you can see do not actually belong to the same person inside the box but instead to 2 separate people.

 

Something a lot like the sawn lady has recently been happening in the world of Anglo-Saxon politics and goes directly to the question of the nature of the new political movement that has given rise to both Brexit and the election of Donald Trump as president of the United States of America.

 

I have characterised this movement as Anglo Saxon nationalism as distinct from   those on the liberal left who regard it as a form of white nationalism with its concomitant implications of racism.

 

The standard Trumpist retort to accusations of racism has been to argue that the same public that elected Donald Trump is the same public that elected Barack Obama on two occasions previously. If these people were prepared to let Obama rule they can hardly be regarded as being racist –can they?

 

But this overlooks the fact that there is a large amount of ‘wiggle room’ within the American electorate. Only half the potential voters in America actually bother to turn out for elections generally and of that half, only half again actually voted for Donald Trump. Which means Trump was actually selected by a quarter of the electorate.

 

Following from this it is entirely possible that both Trump and Obama were actually elected by two more or less entirely separate and different constituencies that have enough spare room within the electorate to hardly overlap at all.

 

In other words it is entirely possible that the vast majority of those who voted for Trump would never in any circumstances vote for Obama or any other black man.  They are in large part an entirely different constituency from the liberals. If you look at the sawn lady’s wiggling fingers and then at her wiggling toes you might start to notice that they are a slightly different colour…

 

The same is equally true in the case of Brexit. Only around a quarter of the available population actually voted to leave the European Union. So the idea that the leave voters represent a disillusioned previously semi liberal strand of mainstream British society is at least questionable.

 

This ‘bagginess’, this loose fitting wiggle room system, is one that tends to lend itself to the performance of conjuring acts such as sawing the lady in half. Given that this is the case, it seems hardly remarkable, in fact entirely predictable, that such a system would attract a showman like Donald Trump.

 

I have described the electoral space that allows Trump and Brexit to rise to prominence. But underlying this there is an economic hollowing out that provides the basis of these political phenomena.

 

The creation of privately issued democratised money in the form of derivatives effectively gives us an economic version of two magician’s assistants within the same box. The wiggling toes and fingers that you see do not belong to the same body. That is why inflation and deflation, labour participation rates and unemployment, equity and bond prices all seem to be sending conflicting signals that we know simply can’t be possible in the real world.

 

If money can be described as an information signalling system then two forms of money privately issued and government issued, existing side-by-side and sending out coterminous signals can only result in increasing confusion.

 

Inflation signals or deflation signals, or growth signals or shrinkage signals are being sent out by either privately issued derivatives economy or the government issued general money economy. It is virtually impossible to say which is which. But the point is that this is not one information system but two systems existing side by side.

 

I have previously argued that the endpoint of this phase of democratised money will result in roughly half the worlds economy being colonised by derivatives. This is not a general guess, a number of pundits have previously indicated that the long term average interest is expected (required), to be 2 ^1/2 to 3 % .In consequence, Donald Trump’s claim to make America Great again can only really mean making half of America great again or America half great again.

 

In a world where half the economy is colonised by democratised money derivatives interest rates can only rise to half their potential maximum. By the same token real inflation can only rise to half its potential maximum. The state sponsored economy can only grow at half its potential rate at maximum. In other words, every and all  aspect of the system can only operate and exist at half the previous level if there is only half the economy  to operate within.

 

So when I say that resolution of the credit crunch crisis is dependent upon how much of the old world the elite is prepared to allow to re-emerge, from the perspective of democratised money, the maximum amount that can be allowed to emerge is 50%, if that is indeed the level at which derivatives will be allowed to colonise the world economy.

 

From this perspective it is possible to make some  specific predictions as to the numbers behind Trump’s make America great again strategy.

 

The long-term average underlying interest rate in the developed economies is around 5%. I have for a long time predicted that the long-term normative interest rate post credit crunch will be 2 ^1/2 to 3%.

 

From what I have said it  should also follow that the long-term average normative inflation rate will settle at around 1 ^1/2– 2 % and that the growth in GDP rate and  growth in employment rate should also settle at around half their historical real average in the post Credit Crunch world.

 

But they won’t of course, for the very straightforward reason that they are made up figures…

 

However there are a number of real life indicators that we can say will be restricted to half their previous level of growth under the half and half economy.

 

Growth in  life expectancy will be cut to half its post war average rate in the developed world.

 

Growth in home ownership will also be cut to half.

 

The average fall in the rate of poverty will also fall to half its previous post war average.

 

So now we know that Donald Trump is going to end up being round about half as frightening as the liberals thought he was going to be..

 

Extra Information

Theresa May is set to announce revolutionary social reform policies – this could be the moment she silences her critics

She insists that the state has a significant role to play in alleviating the everyday injustices faced by people who do not qualify for benefits. Announcing shiny new policies is the temptingly easy part of governing. Much more difficult is delivering the same

http://www.independent.co.uk/voices/theresa-may-speech-social-reforms-revolution-thatcher-brexit-critics-a7516156.html

House Burning Down

 

It might be useful to consider further the relationship between the production of paper news and the production of paper money.

 

I observed that both paper money and paper news are forms of informational transaction. This might be more accurately described as  the transfer of meaning. In this sense ‘meaning’ is the value measurement of information; Meaning is the unit of value of information because meaning transforms data into information and makes it valuable. The construction of meaning is exactly the assigning of value to data.

 

Consider hyper inflation in the money supply . In the traditional monetarist model (the one that has more or less taken over all mainstream economics), this is caused by an oversupply of money into the market. In other words Monetarists argue that the problem of hyper inflation and inflation generally is one of quantity. Actually the problem is one of quality. We can show this with the following:

 

There is a direct relationship between publishing an edition of a newspaper and publishing an edition of money, which is effectively what is done each quarter when the interest rate is set. The interest rate is news about how things are going to be according to a central bank and money notes carry this news.

 

Money published at 0.5% base rate is a different edition of money from  that published at 1% base rate. Same ‘newspaper’, same publisher, but different news, different information, different headline.

 

Just as each particular edition  of a newspaper contains information specific to a particular time and place (as I mentioned last time), the paper money note also contains information. I will describe the nature of this information below but for now lets stick with newspapers.

 

In the example of a newspaper, let us say that the edition of January 6 has the headline: ‘War Is Declared!’. And the edition of January 7 has the headline that ‘Peace Is Declared!’. Taken in sequence the meaning of these events is clear.

 

First there is a state of war, then there is a state of peace and the present condition of affairs is that of peace.

 

Now imagine that the newspapers in question were not dated January 6 and January 7 so that there was no way of telling which was the first headline and which was the second. It could be the case that war is declared and then peace declared or it could be the case that peace is declared and then war is declared. So in the first instance we are now in a state of peace and in the second instance we are now in a state of war.

 

Now let us say that an unscrupulous news agent receives both editions of the undated newspaper from the publisher in correct order but chooses to release them to the local population in either one or the other order for his own personal advantage. If the local newsagent wants to promote the idea that we are at a state of war he will release the newspaper with a war headline second and if he wants to promote the idea that we are at peace he will release that newspaper second.

 

Just such an instance as this is described when  banker Nathan Rothschild famously withheld news of the British victory at Waterloo in order to take advantage of market uncertainty as to the outcome of the battle. By the time the markets received the news that Wellington had won,  Rothschild had bought equities at knock down prices  and made a killing on the rising market.

 

If the local population becomes aware of the possibility that news may be manipulated by a local newsagent for the purpose of controlling perceptions, they might hold on to one or more editions of a newspaper in order to compare headlines and get some idea of what the actual facts of the matter are in sequence.

 

 

Logically, in such a case the local population will have to conclude that NO particular edition of a newspaper is to be objectively trusted and that all editions are either wrong or lying. In other words the paper in its entirety is worthless rather than just this or that edition. This is the qualitive nature of the problem.

 

After all, how can two editions of the same newspaper with the same editor and the same journalists and with no differential date information be judged between? How can you know which is the truth NOW and which is not?  This is in effect what happens in the case of hyper inflation.

 

Think of a paper money note as a generalised abstracted unit of information. On a more sophisticated level we can think of a money note as a unit of evidence. We can say that one or more units of evidence goes up to make an argument and that therefore the more units of evidence you can muster in support of any particular argument the more likely you are to win that particular argument.

 

In a standard economic transaction the argument in question is that you should sell a car,(or any other commodity), to me for this number of paper notes. Or to put it another way, you should swap your car for this number of paper notes.

 

The more units of evidence that you can muster in support of this argument, i.e. the more paper notes that you offer in return for the car, the more likely you are to win that argument.

 

But there is an unfortunate corollary to this. If you win the ‘argument’; by offering more pieces of paper money evidence than the other guy, you also implicitly argue that each individual piece of paper money evidence is worth relatively less.

 

We can return to the practical consequences of this shortly but first, as I argued last time paper bank notes or units of evidence are introduced into the market at a particular time and particular place and at a particular price. So in this sense, they are first and foremost evidence in an argument on behalf of central government made to the general population.

 

The individual argument that paper money notes are evidence for is: ‘These pieces of paper are valuable to this or that extent not only in comparison with objects such as commodities, but those pieces of money paper that have gone before and those pieces of money paper that will come after’.

 

This is of crucial importance.

 

From this perspective the crisis point of hyper inflation occurs when too much information is presented at any one time which results in not a quantitive problem but a qualitive one.

 

Let us say that two purchasers are competing to buy a particular car. They both make the argument that you should swap the car for this number of pieces of paper money. The number of pieces of paper money is the totality of evidence that this or that exchange argument is true and valid.

 

Obviously they cannot offer the same number of pieces of paper as evidence/arguments or the seller will have no way of differentiating between the two. So let us say that Buyer A offers 100 money units and buyer B offers 110 money units. Buyer B wins the argument because he has offered more ‘evidence’ in support of his argument. So far so good.

 

But what if Buyer A offers 100 units as before but Buyer B offers 5000 units? What is the seller to make of that? These two arguments are wildly different, they containing wildly differing amounts of evidence in the form of money notes. (bear ‘fake news’ in mind at this point)

 

Well surely the answer is simple, the seller takes Buyer B’s offer.

 

Not so fast. Most sellers would want to know a little more about it before making a decision in these circumstances. The problem is the totality of evidence.

 

Instead of 210 units in total chasing the car,(both bids), which might be seen as reasonable there are 5100 units chasing the car which is not seen as reasonable given what the seller knows or thinks he knows. Something else is going on…

 

What if a third buyer comes along ten minutes later and offers 10,000 units for the same car? Now the seller will be pretty sure something is seriously going wrong. And the inevitable effect is that he will be forced to distrust all money notes in whatever amount because they are all the same.

 

If ten information money notes are worthless then 10,00 money notes are equally worthless, this is both the strength and weakness of the informational money system. The implication is that the seller  will be forced to distrust the overall message he is getting from the government. But it is a qualitive and not quantitive problem because it does not rely on amounts.

 

So what was that central bank/government message I referred to above? It is that ‘We are in charge and everything is all right’. That is the basic unit of money news implicit in every money note.

 

The second piece of money news is the interest rate, which is the price at which private banks buy money from the central bank. This can be understood as that particular headline for the quarter. But this piece of money news is intimately tied up with the distribution mechanism of the paper notes themselves.

 

A newspaper printing and distribution operation will have a central printing press, regional distribution warehouses and sub warehouses which distribute to newsagents and even paper sellers on the street.

 

Each element of the distribution chain decides how many papers to take and to move on down the chain of distribution according to how profitable they predict this process will be. This depends to a large extent on the nature of the headline. ‘Queen Dies!’ or ‘War Is Declared!’ will tend to sell more copies than ‘Water Supply Goes Off In Addis Ababa’ or whatever. (perhaps not in Ethiopia though..) So the headline affects and ultimately controls the distribution process.

 

The same is true with interest rates. Depending on what the Central Bank decides the interest rate will be, each element of the distribution chain, from the large commercial banks downwards decides how much of this edition of money they will take and distribute according to how profitable they calculate it to be.

 

But what is of the utmost importance to understand is that in the case of money news everyone in the chain acts like the unscrupulous news agent I described above. Everybody is encouraged to withhold editions of the news  and to release them onto the market only when it is in their individual best interests!

 

When you receive any particular edition of money, you either release it into the public by means of spending it or you withhold it by means of saving it. You manipulate the information contained in the note for your own best interests. That is what you are supposed to do- to lie, to spread disinformation.

 

Of course everybody is therefore equally dishonest and so no-one can point the finger at anyone else. The system is based upon everybody spreading corruption and lies. Wouldn’t such a system be inherently unstable and prone to periodic collapse?

 

You betcha!

 

Wouldn’t someone try to contain this corruption and tendency to collapse? Wouldn’t they try to devise a system to mitigate the problem?

 

Yes they would. They would take the logical step of trying to date and order the headlines on each edition so they could be read and understood in sequence. How would they do that?

 

By means of a code that can be read and understood by themselves but importantly, not by you. If you doubt this, take out a currency note and find the identifying  code printed on it, usually referred to as the serial number. Do you know what this code means? If you do not, why don’t you? After all it is supposed to be money issued by a democratically elected government in your name and for your benefit!

 

The purpose of this code is for the people who issued the notes to understand each ‘headline’ and the order it was issued in, but not for you, or anyone like you, to be able to.

 

The system is built on a small minority being able to fully understand the meaning of the money news and the vast majority below them taking part in a game of charades where they lie to each other and manipulate the news supply to each other for the purpose of individual advantage.

 

As a simple illustration of this suppose you had 500 units of currency  and you found out that this denomination of money would be abolished or worthless the next day. What would you do? You would try to go out and buy something with it wouldn’t you? You would try to use the information advantage that you had to pass the problem onto someone else. This is the key to inflation and hyperinflation.

 

We are building up a picture of a central money news/information agency that is issuing news on a regular basis. That news/information is then taken up by the various parts of a supply chain and manipulated and distorted in order to obtain the best possible individual outcome but with inevitable damage to the system as a whole. Assuming that he purpose of the system is to transmit information that is.

 

With this news information model in mind we can now go back to look at hyper inflation. The trouble with hyper inflation is that the seller has no way of knowing which is the most valued up to date piece of information on which to base his decision.

 

This problem presents itself as there being too many pieces of money information in circulation. Discrepancies between the amounts of money evidence offered in any particular argument (trade), force the seller  to increasingly regard all pieces of paper money as being equally invalid- hence the hyper inflation.

 

But the root of the problem here is not validity of any particular trade argument and the money evidence presented in support of it  but the equality between each and all pieces of evidence. Because of this money is actually only credible and valid within a relatively narrow and stable bank of circulation. The sameness of each piece of money information  requires sameness of prediction and sameness of outcome to work.

 

No matter how many paper notes are issued in any financial period they are all  of equal validity to  paper notes  issued  in another given quarter. In other words any episode of  inflationary money printing activity is absorbed into the whole of the financial system and is only ameliorated by later activity.

 

Just as any incorrect news report is absorbed into news production and distribution system as a whole. The system relies on its credibility to absorb the effects of any mistakes and keep people believing in the system even as they curse and dispute virtually all of the specific outcomes the system produces!

 

Since individual savers and consumers effectively act as newsagents, storing the information and only releasing it when it suits the particular interest of the moment, it is inevitable that conflicts of meaning and value will happen.

 

Hyper inflation is an insane babble of arguments that taken collectively can only mean that each individual argument is more or less worthless  since in the last analysis it is all the same argument, that we are in control and everything is alright.

 

Periodically the logic of worthlessness produced by exchanging paper money arguments is expressed by and through a significant number of news agents  going from one door to another  desperately seeking a way out as they sense the impending doom.

 

As the doors are increasingly closed to news hawkers selling bogus information  brands the volume of money seeking any  way out increases exponentially until an overwhelming tsunami of money at any and every exit guarantees it cannot escape. Think of it as a house besieged by fifty street newspaper sellers shouting:

 

‘Extra! Extra! Your House Is Burning Down!’

 

while the house owner cowers within.

 

Disaster.

 

In conclusion I will ask: Is there anything we could do to rectify this state of affairs?

 

And surprisingly perhaps, there is a very simple and very straightforward solution. To date and value stamp money. So that instead of being interchangeable all money is clearly given a value – a ‘sell by date’ at which time it becomes valueless.

 

The closer this expiry date comes, the less the exchange value of the money note. This would solve all the problems now associated with inflation hyper inflation and Monetarism then we could…

 

Oh wait a minute.

 

This form of money already exists. It is called a bond. It is what the banks themselves use when they are dealing with central banks.

 

LISTEN UP

LISTEN UP

LISTEN UP

LISTEN UP

LISTEN UP

LISTEN UP

LISTEN UP

LISTEN UP

LISTEN UP

 

If there is only one thing you take away from all this it should be:

 

THERE IS MORE THAN ONE FORM OF MONEY, THERE ALWAYS HAS BEEN. EACH MONEY FORM SERVES THE NEEDS OF ITS CREATORS. ANYONE CAN CREATE MONEY BECAUSE MONEY IS A COMMONS. MONEY IS A COMMONS BECAUSE IT IS NOT ANY PARTICULAR THING IT IS A FUNCTION- SOMETHING THAT AN OBJECT CAN BE MADE TO DO.

 

GOVERNMENTS MAKE MONEY FORMS TO CONTROL THEIR POPULATION. BANKS AND CORPORATIONS MAKE MONEY FORMS TO CONTROL THE PUBLIC. BITCOIN IS A METHOD OF CONTROLLING ANY SUCKER WHO BUYS INTO IT.

 

PRIVATELY ISSUED DEMOCRATISED MONEY IN THE FORM OF DERIVATIVES IS THE MOST COMPREHENSIVE ATTEMPT EVER DEVISED IN HISTORY TO CONTROL THE WORLD POPULATION DIRECTLY THROUGH THE PRODUCTION AND DISTRIBUTION OF A NEW MONEY FORM.

 

 

 

 

 

 

 

 

 

 

 

 

Not Fake news but Flake News or RIP Tony the Tiger: You Were Grrrreat! | TMZ

 

The recent spat between alt right news outlet Breitbart and capitalist breakfast combine Kellogg is indicative of a new cultural media reality in the Saxon axis. (What a sentence!)

 

After Kellogg decided to pull its advertising spend from Breitbart citing ideological differences, Breitbart responded by ordering a boycott of Kellogg’s breakfast mush by its loyal followers..

 

In the first instance, it is clear that Kellogg’s decision to put ‘money where mouth ‘ is a straightforward illustration of one of the central principles of cultural constituencies;  that in the post free market world commerce follows culture and not the other way round (as free marketers and globalises tried to get you to you believe).

 

What is also interesting was the response of alt-right media organisation Breitbart  by trying to damage Kellogg’s commercial interests. This is an insight into an emergent secondary aspect of post capitalist economy; the subscription model I wrote about last time.

 

I noted that Saxon nationalist organisations in the media and elsewhere will increasingly demand that their subscribers, (as opposed to consumers or investors), actively avoid supporting organisations that do not adhere to their culture. In other words, if you are not with us then you are actively ‘agin’ us and therefore we are actively ‘agin’ you.

 

You can bet that this will spread to other cultural constituencies.

 

The relationship between sponsorship, power, influence and editorial control in capitalist media has long been the source of debate.

 

In developed capitalist societies it is generally accepted that in media there is a tension between the commercial imperatives of advertising and editorial control. It is accepted that advertisers are allowed to control or influence aspects of what is printed in a newspaper, transmitted on TV or radio  in order to maximise the revenue they can receive from advertising in that media. These are accepted parameters of capitalist control over media.

 

Offset against this is a supposed  ‘ethical’ professional code of journalists and editors which means that they are able to some extent to circumvent the commercial pressure to comply with corporate interest.

 

Increasingly this journalistic ethics code has come under pressure, not least from the  explosion of Internet-based alternative media outlets which means that there are now tens if not hundreds of thousands of ‘citizen journalists’ whose relationship to a supposed code of journalistic ethics is undefined.

 

And this changing relationship illuminates an analogy between  the production of news and the  production of money. Money production and distribution can be understood as a form of information dissemination just as news media is.

 

Traditionally newspapers are printed on paper and distributed in the same way that paper Government Issued Money is. The process is that a variety of information brands are delivered to the market to be taken up by different sections of the population at different times in different locations and at different prices.

 

So a certain section of society would buy broadsheets at a certain price and another section of society would by a tabloid title at another price and so on.  Each section of society is not just buying a different news FORMAT but a different news CONTENT. Yet despite this segmentation, the totality of what they are buying is defined as ‘The  News’. This implies that there is such a thing as ‘The News’ and various papers  print various bits of it.

 

The same can be said of traditional government issued money, (including GOVERNMENT SPONSORED MONEY such as bank credits). Currency notes, letters of bank credit etc are provided into the market as concrete paper documents which are then taken up by consumers according to price and availability.

 

Together the totality of different newspapers made up the press and together the totality of different forms of money made up the currency. The NEWS is the TOTALITY of the output of the PRESS. The ECONOMY is the totality of the OUTPUT of MONEY PRODUCERS.

 

Note that the totality of everything that happens on Earth is not the News. In fact the majority of stuff that happens on the Earth everyday is categorised as NOT newsworthy and not reported on. Likewise the totality of everything that happens on the earth is not the Economy. In fact the majority of human activity is NOT regarded as the economy and not counted as such.

 

Given the significance of the ‘News’ for controlling any given society it is inevitable that the state will become involved in its production and regulation.  In many cases, governments become directly involved in the production of news. State sponsored and controlled media organisations like the BBC are an example of this.

 

And it follows that given the significance of the economy in controlling any given society, government will be directly involved in the regulation and ultimately the production of money. In developed capitalist societies this is done by government sponsored private organisations like the Federal Reserve or the Bank of England which operate more or less on a BBC model of governmental control.

 

But if you are supposed to live in a free and open democracy you can hardly have the government clearly controlling what news you have access to . And if you live in a free market economy you can hardly have the government clearly controlling what money or economy you have access to.

 

It is this tension between the necessity of government control and the ideology of open and free that has shaped the relationship between the various elements in both media and economy in the capitalist world.

 

Now increasingly, news (as opposed to newspapers), is disseminated by electronic means. Given Marshall McLuhan’s  famous dictum that the ‘medium is the message’   the increasing pre-eminence of electronic media is transforming the way that news is disseminated and consumed. This affects what news is, who gets it and where and when they get it. And come to think of it, what they do with the news when they get it.

 

Digital news production means it is easier for ‘insurgent’ news outlets to appear because costs of production are rapidly falling. But distribution costs are NOT falling. This is extremely important and I will return to it later..

 

These developments in media  have  led to the emergence of powerful new media blocks that use the ideological rhetoric of the small producer but are in fact simply competitors to mainstream media. ‘Breitbart’ and ‘Infowars’ are two Saxon Nationalist examples of this.

 

This process parallels the rhetoric of Protestantism where a plethora of religious ‘start ups’ -the ‘SMRs’ , (Small to Medium Sized Religions), in the Reformation period was rapidly superseded by a relatively restricted number of larger competitors to the Catholic Church, which claimed they were from the ‘volk’ and of the ‘volk’.

 

Together with the effective collapse of the free market, electronic media has provided the medium for the emergence of cultural constituencies in the field of news .This gives rise to nascent culture, media and subscription wars.

 

It is not possible for these entirely private media conglomerates to provide news in the ‘public interest’. There can never actually be a free press, (in the real capitalist sense that it does not cost anything), under capitalism.  They have to find a way to monetise news production.

 

In this context the digital distribution service becomes increasingly more significant as an additional cost or barrier to access. (See above) Facebook and Twitter  are privately owned news distribution nodes and yet they are expected to act as a public interest conduit for privatised news production sources.

 

As such they are increasingly becoming the subject of territorial dispute. Are they entirely private? Do they have some kind of public interest mandate? Should they be state controlled in part or wholly?

 

This is the dynamic underpinning the debate about ‘fake news’. The ‘left’ wants some kind of government control on nodes like Facebook and Twitter in the  distribution network, the ‘right’ wants to use commercial pressure (boycotts etc), to control them.

 

This development process in the  media illuminates some of the outcomes that follow from the coming prevalence of electronic money (as opposed to the paper kind). Electronic money is of necessity privatised Democratised money in the same way that electronic news is of necessity privatised Democratised news.

 

I can confidently predict that just like the media the proliferation of small-scale digital money producers will  lead to the emergence of medium to large scale competitors to the mainstream money conglomerates. This has always been a fundamental part of the Crackernomics analysis.

 

As  electronic money is increasingly disseminated by electronic means it will affect what money is, who gets it and where and when they get it. And what they do with the money when they get it.

 

So lets draw some of the main strands of this argument together.

 

‘News’ is an abstract metaphysical concept derived from the concrete reality of news production. All the VALID news broadcasters and printers together in aggregate are said to produce the ‘News’.

 

But the concrete historical reality of news production is NEWSPAPERS which are then superseded by electronic media transmission (radio and television) which is in turn being replaced by electronic media.

 

Forget talking about ‘News’ as a metaphysical abstract. NEWSPAPERS were and are limited and defined by WHERE and HOW and WHEN they could be produced and distributed. (So are News transmissions and so are News (‘digitations’?)This specific combination of METHOD, TIME and PLACE defines what NEWSPAPERS were and are. NEWS is always a FUNCTION of METHOD, TIME and PLACE.

 

Here is a simple illustration. A bomb goes off in a city centre. The ‘news’ is that it is a terrorist attack. The news is gathered, processed, edited, printed and distributed in 12 hours. But by the time a customer buys the paper and receives the ‘news’, it turns out it wasn’t a terrorist attack, but a gas leak that caused the explosion.

 

So what is printed in the paper that the customer holds in his hand? Is it ‘News’ ? It can’t be News because it is not true! There is no metaphysical abstract news outside of the way it is produced and there never can be. Content is determined by form.

 

A concrete newspaper is concrete evidence of lying or making an error. (see 1984). News transmissions or digitations solve that problem. We have always been at war with Eastasia etc.

 

This is equally true for paper money. By the time that economic information is created, collected, processed by a central bank and turned into an interest rate that controls the production and distribution of Economy, the information in question may already be proved to be invalid! In fact it usually is….

 

So is the economy produced on the basis of that ‘counterfeit’ information money invalid?

 

The answer both in the case of News and Economy is that these are metaphysical abstracts that are accepted as both true and untrue at the same time. (Yet more Orwell)

 

The known facts and interpretation around any particular news event evolve over time. Interest rates and economic analysis evolve over time. Even though the MAJORITY of what is printed in the name of news and economy can be shown to have been wrong to a greater  or lesser extent, this does not diminish the overall faith in the concept of news and economy.

 

(Note: Paper money hyper inflation is when there are simply too many lies and bad guesses to hide. Note 2: Except in India where they have recently embarked on a wholesale destruction of the paper money evidence)

 

Or it didn’t till recently anyway.

 

But that was before the arrival of Fake News.

 

So what has changed then? What now makes some news providers ‘fake’ and some ‘genuine’? The question might more usefully framed as: What makes a particular news provider VALID OR INVALID?

 

And the answer might surprise you.

 

I have explained that NEWS does not exist in the ether as an abstract. It is the concrete result of the production of different news formats. The same way that NEWS does not exist outside of space it also does not exist outside of time.

 

‘News’ as we see it now is the result of a clear historical process. As I described above this process is intimately linked with the commercial interests of advertisers. And this in turn is intimately linked with the development of capitalism.

 

The ‘modern’ press did not begin in Africa or India or China. This is not a meaningless observation, it goes to the heart of what ‘Press’ and ‘News’ really is. We can see that  the ‘Press’ and ‘News’ is the product of German history and culture just as surely as Protestantism and Capitalism is.

 

Which brings us to the question of validity-not as some kind of abstract quality belonging to abstract ‘News’ argued about by differing interest groups, but as a concrete historical reality.

 

Papers that were published in the beginning of the News industry were the newspapers that received the investment necessary for obtaining news print, distribution and news gathering resources etc.

 

Investment was forthcoming on the basis that newspapers were a viable commercial venture. Newspapers were a viable commercial venture to the extent that they could obtain advertising revenue. They could abstain advertising revenue to the extent that they would comply with the needs and wishes of advertisers.

 

Simply put, traditional papers were valid to the extent they were given the blessing of commercial interests of advertisers.  And that is all. Everything else said about the historical press – all the rhetoric about freedom of speech etc- is just someone trying to blow smoke up your backside!

 

We can see the accuracy of this observation by considering attitudes to the non commercial press/media. Two good examples of this are RT, the Russian sponsored media outlet and the BBC.

 

Both RT and BBC are regarded with scepticism or outright mistrust by large sections of the public in developed economies. They are regarded as suspicious (as in fake news) because they are held to have an agenda which comes from their sponsors which are governments..

 

This agenda is held to be more overt and controlling and less trustworthy than the agenda imposed on commercial press/media outlets by their advertisers. But why should this be so?

 

Because as I said above there is an accepted degree of commercial control that is allowed from advertisers and offset against this is the supposed journalistic ethics that allow journalists to report despite commercial pressure. This capitalist Germanic concept is embedded in the history and the ideology of ‘News’.

 

Central to this cult ideology is the concept of plurality of advertisers which works like this: Advertisers sell products into society which has a variety of groupings and individuals that represent a spectrum of thought and opinion on various matters.

 

The more and varied the advertising corporations are, the more likely they are to represent a variety of opinion which is the supposed endpoint of democracy. The ideal advertising profile of a media organisation would be one that contains a wide variety of large mass producing corporations such as Kellogg.

 

These corporations then advertise in and validate any given media organisation. If the media organisation produces ‘News’ that is against the tastes of the wide and deep variety of consumers that the advertising corporations represent, the advertisers threaten to withdraw advertising unless editorial policy is altered. We have a self sustaining self regulating commercial capitalist media!

 

And this brings us to the central problem. In modern digital media production costs are heading towards zero. This means that the potential commercial pressure that advertisers can exert is also heading towards zero. And since advertisers commercial power is heading towards zero, their position as representatives of society through consumption is heading towards zero. Death of capitalism!!

 

From this perspective we can look again at the story that prompted this piece: The Breitbart/Kellog spat.

 

Breitbart started out as an insurgent small scale  Saxon Nationalist digital media operation with little or no effective media production costs. Under the terms of capitalist cult media it was invalid as it had no plurality of advertisers and therefore no commercial mediation of what it produced.

 

As it became bigger it attracted a plurality of larger scale advertisers up to the level of mush corporation Kellogg.

 

Kellogg received feedback that the content of Breitbart is offensive to some of the consumers it is supposed to represent.

 

Kellog expresses that offense with the threat and then the execution of removal of advertising revenue.

 

This is supposed to bring Breitbart back in line and serve as a warning to other digital media producers. But it hasn’t worked. Because fundamentally Breitbart’s production costs are close to zero.

 

So then pressure is applied to Facebook/Twitter etc, the distribution nodes that serve Breitbart because they CAN be controlled by large scale advertising revenue pressure. But even here, production costs are heading towards zero. This has limited effectiveness. So then the state is called in to regulate under the Fake News justification.

 

But there really is no such thing as FAKE NEWS only INVALID PRODUCTION which is production not regulated by large scale commercial advertising.

 

Its really all about FLAKE NEWS not FAKE NEWS.