Monday 30 April 2012

The Golden Hammer of Neoliberalism

The Golden Hammer fallacy is a form of very simple answer fallacy. It seen when the proponent offers the same kind of solution to every problem. If all they have is a hammer then everything begins to look like a nail.

Orthodox neoliberals consider the core neoliberal policies (financial sector deregulation, privatisation of state infrastructure, tax cuts for corporations and the rich, welfare cuts, ceding of fiscal autonomy to central banks) to be economically essential no matter what the economic circumstances. Even when the economic problems of the day (the global economic crisis) can clearly be traced back to previous neoliberalisation policies (financial sector deregulation in the UK, USA, Eurozone, Iceland.....) the orthodox neoliberal will offer only the Golden Hammer of further neoliberalisation (austerity) as a solution.

The use of Golden Hammer fallacies can be seen throughout history. Countless organised religions have used the golden hammer fallacy in order to explain away natural disasters such as droughts or earthquakes. The religious order of the day would claim that the natural disaster occurred only because the followers had not been praying hard enough, making enough religious sacrifices or engaging in heretical behaviour. Thus in order to prevent further earthquakes or to end the drought, the people must pray harder, make more religious sacrifices and avoid heretical behaviour. Thus whatever the circumstances, the answer must always be for the followers to devote more effort and resources to the maintenance of the religious order.

Dr Samuel Solomon became rich selling his
Cordial Balm of Gilead as a cure all medicine, even though
it was nothing more than a herbally infused fortified wine.
Another example of the Golden Hammer fallacy can be seen in the activities of 19th Century quack doctors hawking their patented "cure all" elixirs. These quack "medics" used the modern practices of branding and aggressive marketing to sell unproven, ineffective, and often dangerous medicines to the public. The English quack Dr Samuel Solomon claimed that his Cordial Balm of Gilead could cure almost any medical complaint, even though it contained only brandy and a mixture of herbs. He sold it for for 33 Shillings a bottle (nearly £100 in today's money) making him a rich man, whilst doing absolutely nothing to alleviate the suffering of his patients.

An example of the Golden Hammer fallacy being used to promote a particular political ideology can be seen in the attitude of 20th Century totalitarian communist regimes. When such totalitarian regimes suffered economic crises (often caused by the overcentralisation of the economy or the fear of harsh reprisals against those that would speak out against corruption or inefficiency), the response of the communist state would be to blame the actions of "anti-revolutionary elements" or the interference of "imperialist western agitators". Thus the response to the failings of the isolated totalitarian economic systems would be to adopt an even more totalitarian stance by orchestrating witch hunts against political opponents, or to increase the state of economic isolation through the prevention of trade with the "imperialist west".

Returning to the neoliberal ideology, it is quite clear that the causes of the current economic crisis can be traced back to the neoliberal policy of financial sector deregulation. These financial sector deregulations led to the creation of vast speculative bubbles built on easy credit. Once the bubbles burst, the Western economies were dumped into prolonged periods of recession. The neoliberal response to this crisis was to divert attention away from the causal link between neoliberal financial sector deregulation and the economic crash and instead blame the "cost of welfare" for the crisis. Thus, to the orthodox neoliberal the only solution to the ongoing economic crisis is further neoliberalisation of the economy under the guise of economic austerity.

Neoliberalism is not the first political ideology to rely on the
Golden Hammer fallacy, the communist Soviet Union even
incorporated a golden hammer into their flag!
It is quite clear that neoliberalism is a fundamentalist economic ideology, which on the opposite side of the coin of economic extremism to the equally dogmatic communist ideology, in that faults in the system can always be explained away with post hoc excuses and any inherent problems caused by this kind of economic extremism will always be presented as a need for more fundamentalist reforms.

Neoliberalism and totalitarian communism can both be seen as faith based ideologies, forms of political fundamentalism that have filled in the voids left by decline in organised religion, which has come about due to the deliberate suppression of religious expression in communist regimes or through the rise of self-interested individualism in the West. Both of these political ideologies rely on core indisputable principles. Just as adherents of the organised religions of the past had faith in a God capable of and willing to intervene to punish or reward them for their behaviour, the modern neoliberal has an unshakable faith in the ability of unregulated markets to regulate themselves. Even when faced with overwhelming and undeniable evidence that deregulated markets lead to vast anti-competitive monopolies and oligopolies that become too big to fail, needing vast state interventions to prevent widespread economic chaos (the 2007-08 financial sector meltdown), the neoliberals quickly cobble together some lame post hoc excuses about how the market only failed to regulate itself properly because it wasn't free enough.

The neoliberals like to dress up their argument in the language of maths and science in order to create a veneer of expertise and legitimacy, even though the track record of failed neoliberal experiments is a very long one indeed (brutal South American dictatorships, Russian oligarchs, the south-east Asian crisis, increased poverty in post Apartheid South Africa, the Argentine economic meltdown, the global banking crisis, the Spanish property crisis, the Icelandic financial crisis, the Eurozone crisis). 

Neoliberalism is a form of pseudo-science, since it is a practice which is presented as scientific, yet refuses to acknowledge the litany of failed neoliberal experiments, simply relying on post hoc excuses to explain away the latest failure in the application of their theories. Just like the quack doctors of the 19th Century, the proponents of the neoliberal ideology don't seem to care that huge numbers of people have suffered the terrible side effects of their toxic economic elixirs. 

That so many people lap up the pseudo-scientific drivel of the neoliberals comes as no surprise, people seem inclined to believe in simplistic Golden Hammer explanations. Without widespread public gullibility, religious fundamentalism would never have thrived for Milena, the snake oil salesmen of the 19th Century would have been unable to prosper and any politician spouting defunct neoliberal pseudo-economic gibberish would have been booted out of office back in 2008.                
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Sunday 29 April 2012

More riches for the rich, recession for the rest

Lakshmi Mittal, Indian born
steel magnate and the richest
man in the UK.
Britain has slumped back into recession, the coalition government is attacking labour conditions, pensions and welfare provisions under the guise of "austerity" but the richest are still getting richer. The most wealthy 1,000 men and women in the UK increased their combined wealth by 4.7% from the previous year to £414 billion.

The fact that the richest 1,000 people in the UK became significantly wealthier, whilst the rest of us have suffered the stagflationary effects of the of Osborne's austerity and and the giant BoE quantitative easing money printing scam, comes as absolutely no surprise, given that the bosses of the FTSE 100 companies awarded themselves a whopping average salary increase of 49% in 2011.

A closer analysis of the Sunday Times rich list reveals that almost one fifth of the richest people (192) are listed as "property", followed closely by from people from the world of "finance" (185). Considering that the property and financial sector were responsible for the inflation of the "easy credit" backed property speculation bubble that caused the neoliberal economic crisis in the first place, it is a bit galling to see that these sectors provide 37.7% of the very richest people in the UK and that they are richer than ever, whilst the great majority of Brits are suffering from wage stagnation, pension cuts, property devaluation and loss of welfare entitlements.

1. Lakshmi Mittal (& family)Steel£12.7 bn
2. Alisher UsmanovMining and investment£12.3 bn
3. Roman AbramovichOil and industry£9.5 bn
4, Sri & Gopi HindujaIndustry and finance£8.6 bn
5. Leonard BlavatnikIndustry (Russian oil)£7.6 bn
6. Ernesto & Kirsty BertarelliPharmaceuticals£7.5 bn
7. The Duke of WestminsterProperty£7.3 bn
8. David & Simon ReubenProperty and investment£7.1 bn
9. John Fredriksen (& family)Shipping and oil services£6.6 bn
10. Weston brothers & FamilyRetailing£5.9 bn

That so many of Britain's richest people come from the economically unproductive sectors of finance and property contrasts starkly with the fact that only 129 of the richest 1,000 come from the industrial sector. That industry provides such a relatively small number of the richest individuals in the UK is indicative of the modern era of industrial decline. A great deal of the industrialists that have made it onto the rich list actually made their fortunes abroad before relocating to Britain to benefit from the lax tax regime.

Gerald Grosvenor is the only UK born individual in the top 10
and he inherited his wealth from his father.
It seems that since the British neoliberal revolution in 1979 the best way to make a fortune in Britain is through financial speculation or property ownership, meaning that genuinely productive sectors of the economy (industry & manufacturing) have been left to ruin, since the easy money is to be made elsewhere.

Another noteworthy observation is that only one person of the richest ten people in the UK was actually born in the UK. It is absolutely no surprise that the only non-immigrant individual to feature in the top 10 is a member of the aristocracy, the billionaire landowner Gerald Grosvenor, 6th Duke of Westminster who inherited his wealth from his father, Robert Grosvenor, who was Britain's richest man in the 1970s. The rest of the top ten is made up of foreigners who have relocated to Britain: Three Russian oligarchs (Usmanov, Abramovich, Blavatnik), two Indian born industrialists (Mittal, Hinduja), one Norwegian born Cypriot (Fredriksen), the Indian born Iraqui Reuben brothers, the Swiss-Italian Bertarellis and the Canadian Weston brothers.

It seems that the best ways to become one of Britain's super rich elite are to be a foreigner relocating to Britain for tax purposes or a member of the landed aristocracy. Actually doing something productive and creating jobs comes way down the list, behind banking, property speculation or even being a celebrity from the worlds of film, media or sports. So if you intend to mitigate the worst effects of this Tory driven recession by joining the super-rich elite, make sure to be a rich foreigner or to inherit some wealth. If you do intend to "earn" your wealth in Britain make sure to stick to financial sector gambling, corporate profiteering or living off the proceeds of your property empire. Don't ever think about actually producing anything or employing people, this is a waste of time in neoliberal Britain.

Saturday 28 April 2012

The case for a National Investment Bank

As an economic recovery strategy austerity is not working. Defenders of the "orthodox neoliberal" response to the ongoing economic crisis often demand to know what the alternatives are to their favoured cut-now think later strategies. In this series I'm going to explore what some of these economic alternatives could be.

Decades of orthodox neoliberal politics meant that huge sectors
of the UK economy went to ruin for lack of state intervention,
however when the neoliberal financial sector elite got into trouble
the state immediately tore up the neoliberal rule book to provide the
biggest state subsidies in UK history to their financial sector mates.
The UK economy is stagnating in the wake of the neoliberal economic meltdown because corporate banks are too busy deleveraging and gambling on the unregulated derivatives market to make loans to people and businesses in the "real economy". Without finance, small and medium sized businesses are unable to expand and create employment, while many larger businesses are being forced to downsize due to lack of credit and the weakness of the wider economy.

For decades the UK political establishment concentrated on turning the UK into a London centric financial services based economy, leaving large sectors of the real productive economy (manufacturing, mining, steel, ships, train building, HGV production) to decline and ruination for the lack of government support. What makes this neglect so much worse is that when their beloved neoliberal financial sector experiment collapsed under a landslide of debt, the Neo-Labour government of the day piled in to save the financial sector elite with the largest state subsidies in British history (90%+ of GDP on bank bailouts and the nationalisation of debt riddled institutions). After sitting on their hands and allowing British industry to fall into desperate decline in compliance with the neoliberal mantra that "state intervention is bad", they immediately ditched the principle in order to bail out the financial sector temples of neoliberalism that had so enthusiastically supported the government's destructive hands off economic approach.

The financial sector lapped up the government cash, took hundreds of billions more in secretive ultra low interest loans from the Bank of England and the US Federal Reserve and another £325 billion in freshly printed quantitative easing cash from the Bank of England, yet virtually all of this cash was simply used to pay down their extraordinary gambling debts (deleveraging), with little of it filtering through to the "real economy". Any money that did filter through to the "real economy" came in the form of loans with interest rates way above the minimalist rates of the secretive central bank loans. It is quite clear that the financial sector simply set about profiteering with their bailout funds rather than using them for the best interests of the wider economy.

It is a widely accepted economic theory that at times of economic crisis the government (and central bank) need to stimulate the economy, however in the wake of the neoliberal economic meltdown, virtually all of the economic stimuli have been gobbled up by the very same financial institutions that caused the crisis in the first place. What is worse is that the ideologically driven Conservatives have spent the last two years extracting the cost of these stimuli from the genuinely productive economy in the form of austerity measures and welfare cuts, using the great neoliberal lie that welfare spending rather than financial sector incompetence caused the economic crisis as their justification.

It is quite clear that these policies of economic stimuli for private financial sector institutions and austerity for the wider economy have resulted in stagflation and economic chaos. The policy needs to be reversed, economic stimuli should go to the "real economy" and the financial sector that created the crisis should suffer the austerity measures.

The state owns an 84% stake in RBS
and subsidiaries such as NatWest. This infrastructure
could be used to establish a National Investment Bank.
The state should should step in to provide economic support to the "real economy" and with the nationalisation of several debt stricken financial institutions during the financial sector meltdown the United Kingdom government has already acquired the infrastructure to operate a National Investment Bank.

The role of the National Investment Bank should be to make low interest loans to projects that further the national economic interests. If corporate banks are too busy deleveraging and gambling on the unregulated derivatives market to make economically beneficial loans, the National Investment Bank should step in to finance entrepreneurs, wealth creators, research and development, employment providers, economically valuable public services (healthy & educated workers are productive workers) and infrastructure development.

The National Investment Bank should also invest in affordable housing construction and provide low interest finance to hard working families, lowering the absurd cost of housing in the UK and creating a stream of disposable income to stimulate the economy.

The National Investment Bank could also be used as a tool to counter the economically destructive practices of tax dodging by making sure that any recipients of low interest NIB loans pass a financial fair play assessment by demonstrating that they avoid using offshore tax avoidance structures or non-dom statuses. If companies and individuals are not prepared to pay their fair share of UK tax, they should not be allowed to access the benefits of low interest NIB loans.

Imagine how much better the economic outlook could have been if the £325 billion in quantitative easing cash and £1 trillion in financial sector bailouts had gone directly to the real economy of jobs, manufacturing, education, research and services instead of being used just to prop up the debt riddled, tax dodging, derivatives gambling, financial sector elite.

Friday 27 April 2012

George Carlin on the American Dream

American comedian George Carlin (May 12, 1937 – June 22, 2008) telling it how it is.

The "evil state" vs "virtuous private sector" false duality

The private company National Express demonstrated
the "virtues" of the private sector by bailing out of the
East Coast Mainline franchise, leaving the taxpayer to foot the bill.
The state vs private false duality is the long standing right-wing position that "the state" is evil and that the only way that "we" can be freed from the "tyranny" of government is to reduce the size of "the state". The argument is usually expressed in defence of ideologically driven neoliberalisation strategies such as the dismantling of welfare provision or the privatisation of state assets (of the kind that may either generate a profit or be profitably asset stripped) to the supposedly virtuous corporate sector.

The first and most obvious problem with the argument is the fact that it relies on oversimplification, the facile "good vs evil" argument. There is no room for nuance in the world of right-wing propaganda. Upon any kind of examination it becomes clear that "the state is inherently bad" and "the private sector is inherently good" are false premises. There are countless examples of positive state interventions (the provision of universal education, and the prevention of child labour being two that are particularly difficult to contradict). There are even more examples of private sector immorality (the massive scale of corporate tax dodging, systematic fraud against their own customers, bribery, toxic waste dumping, executive greed at a time of "austerity", use of mandatory unpaid slave labour through Workfare,  jumping out of unprofitable contracts leaving the taxpayer to foot the bill....). Anyone espousing such facile "black and white view" conceptions of government and the private sector must either be a fool or a propagandist.

For the proponent to espouse such oversimplified arguments they must be using the ignoring the facts strategy. Since the 1970s the size of the state has shrunk dramatically with huge state industries sold off to the private sector (oil, gas, coal, steel, aviation, rail, water) and state services outsourced (diverse functions of local government, school meals, forensic science, court translation, PFI scams to name but a few) yet the living standards of ordinary working people have fallen dramatically since this process began. Wages have been stagnating for decades, pensions have been repeatedly attacked, the retirement age has been increased, personal debt levels have grown enormously and most families need both parents to work in order to make ends meet. If the "evil state" is so bad, why have things been getting so much worse for ordinary working people since the neoliberals began dismantling it?

When you come across the state vs private false duality argument, you may notice that the proponent uses the strategy of cloaking in emotive language, using negative words and phrases like the "parasitic" state, the taxpayer's "burden", welfare "scroungers" the "tyranny" of the state. The emotive appeal strategy is also used when the blame the victim fallacy is invoked as "evidence" that the state is bad. A typical example of "blame the victim" would be the accusation that the state encourages people to become unemployed "welfare scroungers" by paying unemployment benefits, without any consideration of the fact that huge numbers of people are made unemployed when their supposedly virtuous private sector employers decide to increase company profitability by sacking their local workforce and replacing them with much cheaper third world labour or simply sacking everyone and asset stripping the business.

Another indicator of a fallacious argument is the tactic of speaking on behalf of the majority. This strategy relies on the casual assertion that the proponent's argument has the backing of the majority through strategic use of the words "we" and "us". Speaking on behalf of the majority is a technique closely associated with far-right extremism, the 20th Century fascist movements used it to defend their ethnic cleansing policies and the modern day far-right use it to speak out against Muslim communities. Whenever you hear anyone speaking on behalf of the majority without a great deal of reliable statistical data to back up their assertions, you should be extremely wary of their agenda.

As with many right wing arguments,
the state vs private false duality relies
heavily Joseph Goebells' big lie strategy.
Returning to the initial criticism of oversimplification, one of the most fundamental flaws in the state vs private duality is that the state and the private sector are intricately linked together through the private vested interests of countless politicians, the secondment of corporate staff to political parties, the lobbying industry, corporate junketing, huge state subsidies and outsourcing contracts, hundreds of billions worth of PFI scams and joint "diplomatic trade missions" to sell weapons to third world countries. Under the neoliberal political system many politicians see their time in politics simply as a stepping stone to further riches, designing policy to curry favour from corporate interests in the form of boardroom positions or lucrative "advisory roles" to supplement their bloated government pensions.

If we are to allow blatant oversimplifications, a more accurate one would be a symbiotic establishment relationship between government and the private sector, working jointly to undermine the rights and conditions of ordinary working people.

As with most right wing nonsense, the state vs private duality relies on the strategy of argument by repetition, otherwise known as the big lie technique, a strategy described by Nazi propaganda minister Joseph Goebbels as "when one lies, one should lie big, and stick to it" and that "if you tell a lie big enough and keep repeating it, people will eventually come to believe it".

The state vs private duality has been repeated so often that it has become an unquestionable truism to the right wing media and the orthodox neoliberal political establishment. The casual assumption that the private sector is better than the state forms the foundation stones of countless other lame right-wing arguments, including the parasitic state argument, the golden hammer of neoliberalism, the unavoidable austerity position, the myth of private sector efficiency and the great neoliberal lie.
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Wednesday 25 April 2012

Austerity and the double dip

UK chancellor George Osborne is an economic simpleton,
a malicious ideologically driven neoliberal or most likely both.
On 25 April 2012 it was announced that the UK economy had fallen back into recession after suffering a 0.2% fall in GDP in the first quarter of 2012 which followed a 0.3% contraction in the last quarter of 2011. A technical recession is defined as two or more consecutive quarters of economic decline. These figures mean that the UK is suffering the first double-dip recession since the 1970s. The first recession between 2008 and 2009 was caused by the catastrophic meltdown of the deregulated financial sector. After hundreds of billions in bailouts, quantitative easing and secretive ultra-low interest central bank loans, the economy began to recover slightly at the tail end of Gordon Brown's government showing very weak economic growth figures, however the Tories have undermined the economic recovery in their ideologically driven rush to cut state spending.

The fact that the Tory led coalition has led the UK back into recession isn't simply a case of Tory incompetence, it is a demonstration of Tory malice. Instead of coming up with a credible recovery plan, they've gone full steam ahead implementing hard line ideologically driven neoliberal reforms under the guise of "austerity", telling us that the cuts are necessary because "the national credit card is maxed out" whilst simultaneously finding £40 billion to pour into the IMF neoliberal loan shark fund to force the same kind of destructive neoliberal policies onto other countries.

The neoliberal gibberish that underpins Tory thinking is defunct, it was holed beneath the water line when the "evil state sector" had to bail out the financial sector temples of neoliberalism with the biggest subsidies in human history (the Tory supported nationalisation of debt riddled banks and 90%+ of GDP blasted in massive bailouts that are still misleadingly kept hidden away off the national debt figures) yet the Tories continue hawking exactly the same ideologically driven neoliberal clap-trap under the new name of "austerity".

Neoliberal policies such as deregulation of the financial sector and hiving off the responsibilities of the state to "extremely inefficient" (according to the treasury select committee) PFI ripoffs, crappy outsourcing deals to enrich their mates, massively subsidised and inefficient monopolies like the rail shambles and insane privatisations like selling off HMRC properties to a bunch of tax dodgers are what created the neoliberal economic meltdown and the budget deficit in the first place, but all the Tories have offered since the meltdown is more of the same ideologically driven gibberish under the new name of "austerity" whilst lying through their teeth that the crisis was caused by excessive state spending.

Andrew Lansley's NHS sell-off doesn't have any economic merit,
unless you consider diverting taxpayers' cash to parasitic private
sector health care corporations to be economically beneficial.
Their self defeating austerity drive has absolutely nothing to do with saving the economy, it is all about attacking the state from within in order to cream off even more taxpayers' cash directly into the pockets of their private sector mates and financial contributors, destroying the social safety net (attacks on health care, unemployment benefits, disability benefits, pensions, social services, legal aid, police numbers....) and wreaking as much havoc as they can in deprived traditionally Labour voting areas with their insane "regional pay schemes" which are exactly the opposite of what is needed, namely better pay and conditions as incentives for talented people to go and improve services in deprived areas.

The Tories have driven the UK back into recession by trying to use neoliberal economic dogma to cure an economic crisis which was caused by three decades of neoliberal dogma. A neoliberalisation process started by Thatcher's Tories and continued under 13 years of neo-Labour rule. The economic crisis was caused by an overdose of toxic neoliberal medicine, yet the Tories have spent the last two years prescribing greater quantities than ever of their economic arsenic quack medicine.

The fact that the Tories have stuck rigidly to their defunct neoliberal principles shows us one of two things: They either meet Einsteins definition of insanity (doing the same thing over and over again and expecting different results) or their agenda had nothing to do with economic recovery in the first place and that they are simply interested in further enriching the already wealthy at the expense of everyone else in complience with their unofficial party motto of  "steal from the poor to give to the rich".

See also

The Mensch fallacy

The ideologically driven neoliberal dogma that has been the foundation of Conservative party policy for over three decades is defunct. It was holed beneath the water line when the "evil state sector" stepped in with the biggest state subsidies in human history (bailouts at above 90% of GDP by the government's own estimates and the near complete nationalisation of several debt stricken and insolvent banks) to rescue the financial sector temples of neoliberalism from the consequences of their own reckless gambling. Yet the political and economic establishment continue hawking exactly the same ideologically driven neoliberal clap trap under the new name of "austerity".

The best that (failed) Tories like Louise Mensch can offer in defence of their adherence to defunct ideologically driven pseudo-economic gibberish is to trot out truly pathetic arguments against those who complain about the defunct neoliberal model, excessive corporate greed, financial sector corruption and growing inequality.

The Mensch fallacy relies upon the straw man argument that anyone that opposes neoliberal economics, must be a raving anti-capitalist tree-hugger who opposes all forms of trade. Thus if these protesters have ever bought any commodity under the capitalist system (coffee and tents are her cited examples) they must be complete hypocrites.

Louise Mensch made this utterly lame point during an appearance on the long running BBC topical news comedy panel show Have I Got News For You and was immediately set upon by the other panellists for having made such a stunningly fallacious argument. That she tried to pull off a spectacularly lame right-wing fallacy in such a public setting gives her the unusual distinction of getting the first ever political myth busting fallacy named in her (dis)honour.

The Mensch fallacy is so lame it hardly needs further deconstruction, but I'll go on anyway.

Opposing the excesses of the deregulated financial sector does not equate to hating capitalism and all forms of trade. Living within a particular economic system does not disbar a person from criticising perceived problems with the system. You don't have to want to go back to a stone age barter system economy in order to complain that the FTSE 100 corporate executives awarded themselves a stonking 49% average pay rise in 2011, at a time when the vast majority of ordinary people were being made to suffer wage repression and harsh self-defeating Tory austerity.

Another huge flaw in the Mensch fallacy is that it would work just as well as a criticism of anti-communist protesters, in that they will almost certainly have benefited from provisions of the state at some point (used the state owned public transport system, drunk from the state owned water supply or relied on their state sponsored education for their ability to write their protest banners).

The fact that the Mensch fallacy is equally applicable to anti-communist protesters is particularly ironic as her argument is little more than a stunningly dim-witted extension of the pathetic "If you don't like it here, why don't you just go and live in North Korea" retort.

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Tuesday 24 April 2012

Eurozone austerity; neoliberal dogma rebranded

Mario Draghi, head of the ECB and neoliberal austerity lover.
Even as IMF and European Central Bank imposed "austerity measures" cripple the European economy with low growth, falling living standards, negative equity, massive reductions in welfare standards and labour rights, mass unemployment and dramatic falls in discretionary income the orthodox neoliberals have their fingers in their ears as they repeat their pathetic anti-state, free-market incantations.
They keep chuntering on about how excessive welfare spending is responsible for the Eurozone crisis but state spending didn't cause the neoliberal economic meltdown, three decades of insane ideologically driven greed-is-good neoliberalism caused it, after which the state sector had to step in the financial sector and their temples of neoliberalism with the biggest state subsidies in human history (massive bailouts, secretive ultra-low interest central bank loans and the nationalisation of debt riddled banks).
Without the intervention of the state sector, the whole neoliberal economic experiment would have come crashing down, yet these orthodox neoliberals know no other economic elegies. So their mantra tells us that the blame for this crisis lies with the "excessive costs of statehood" not with the reckless financial sector gambling they enabled through neoliberal market deregulations that actually triggered the economic meltdown.

Since November 2011 the European Central Bank has handed out over one trillion euros in ultra-low interest loans to help private sector banks pay off their reckless gambling debts (a process euphemistically referred to as deleveraging) and in order to pay for this splurge of reckless lending to cover the debts incurred through reckless lending, they are insisting that the ordinary working people of Europe pay for it through "austerity measures".
These beloved "Austerity measures" of the IMF and the ECB are just the same old defunct, ideologically driven neoliberal clap-trap that caused the crisis in the first place with a new name. A decade or more of economic stagnation doesn't matter a jot to these people as long as they can keep milking the system for their disproportionate share of the wealth, they don't give a single toss that millions of decent hard working people and their families across Europe are going to be driven deep into poverty.

The ruling elite of bankers, politicians and unelected technocrats have completely lost touch with reality, they're singing from a book of defunct pseudo-scientific economic dogma, leaving the people of Europe searching for an alternative to their willfully destructive policies. Will they look to the left wing with their policies of mixed economy, state investment and regulated capitalism, selective re-nationalisations, financial sector re-regulation and clampdowns on tax fiddling? Or will they join the even-further-right wing in their traditional blame the minorities scapegoating?

See Also

Sunday 22 April 2012

What are Nick Clegg's pledges worth?

Liberal Democrat leader Nick Clegg reportedly urged David Cameron to "remember the coalition pledge to institute House of Lords reform". I can't believe the man has the gall to invoke the word "pledge" ever again after the way he ordered his party to brazenly betray the students for a few scraps of Tory power.

The man is clearly a half-wit if he doesn't realise that to millions of people the word "pledge" is now a neologism meaning "Liberal Democrat dishonesty".

Thursday 12 April 2012

Map of nuclear testing

Here is a time-lapse video of every one of the 2,053 recorded nuclear explosions between 1945 and 1998. It was created by Japanese artist Isao Hashimoto who wanted to illustrate the "the fear and folly of nuclear weapons".

Monday 9 April 2012

George Osborne's charity tax

George Osborne, the man that believes that
philanthropy should be tax
That the Tories at the heart of the UK coalition government are dishonest is undeniable. Everyone should remember David Cameron's pre-election claim that there would be no more top-down reorganisations of the NHS, swiftly followed by the launch of the biggest top-down reorganisation in NHS history. A reorganisation opposed by a huge majority of health care professionals and the public alike.

That they are corrupt is also hard to deny, given that their co-treasurer Peter Cruddas was forced to resign after attempting to sell political access in return for massive cash donations and that the majority of Tory donations come from the financial sector that they have steadfastly refused to reform, despite the huge economic crisis precipitated by reckless financial sector gambling.

That they are a divisive influence is also well evidenced from their incompetent handling of the tanker driver dispute. Instead of acting as a neutral mediating force in a safety dispute between tanker drivers and their employers, the Tories decided to wade in on the side of the employers, engage in a bit of trade union bashing and provoke a nationwide fuel buying panic in the process.

The latest of a long line of Tory scandals to break is yet another cack handed piece of legislation from the office of George Osborne. Under the guise of a "tycoon tax" Osborne has decided to launch an attack on philanthropy by imposing taxation on large charitable donations. Under Osborne's so called tycoon tax, exemption will be removed from charitable donations over the value of £50,000 or over 25% of the donors income. What this means is that rich philanthropists who decide to donate large amounts to charitable causes will be stung with enormous tax bills. The move has been widely condemned by an alliance of aid groups, charities and arts organisations, who have pointed out that taxing charitable donations runs entirely counter to the culture of giving at the heart of David Cameron's so called "big society" idea.

Nick Clegg, assuming his normal role as a Tory shit deflector.
Osborne's "charity tax" has also been condemned from across the political spectrum, including several prominent Liberal Democrats, such as Lord Oakshott who said that "It's insulting nonsense to pretend people give generously to charity to dodge tax."

There are even calls for an u-turn from the barkingly right-wing Conservative Home website, on which Jill Kirby makes the unfounded accusation that "the decision to include charitable donations in the tax relief crackdown is said to have been urged by Nick Clegg". As much as I find Clegg and the Lib-Dem liars distasteful, the fact that many prominent Lib-Dems have openly criticised Osborne's charity tax suggests that the Tories are once again simply using Nick Clegg as a convenient shit deflector.

If this "charity tax" is not rescinded, it would serve as absolute proof that Cameron's "big society" idea was just another piece of PR guff aimed at conning the public into believing that the Tory party are "compassionate conservatives" but if it is withdrawn it would show that Osborne is a blundering idiot that is completely out of his depth.

The fact that Osborne can't back down without looking like the fool that he is, makes it almost certain that he is not going to budge. A Tory spokesman said that the Chancellor will "proactively explore with philanthropists ways to ensure the new limit will not significantly impact upon charities that depend on large donations". The salient point is, that if Osborne had actually thought through the consequences of this legislation before announcing it he wouldn't have to proactively seek reactive solutions to his own legislation.

This "charity tax" legislation is so obviously crazy that it should leave you asking the question "are the Tory party completely incompetent or just plain evil?"

The case for incompetence is a strong one, given the fact that this government has been hit by hit by a never-ending storm of scandals (Coulson-Wade-Muroch, Adam Werrity, Peter Cruddas & cash-for-influence, the granny tax, pastygate, the fuel panic....) but there is also the case to be made that this is just another example of Tories living up to their "nasty party" reputation.

If you look more closely at the neoliberal ideology that drives modern Conservatism, the whole philosophy is founded on the idea that people should be nothing more than self interested automatons (the homo economicus theory). The idea being that the economy is most efficient when everyone acts in their own personal self-interest, based on the Randian idea that greed is the only true virtue and that all other ethical considerations are aberrations. The Conservative excuse for the spectacular failure of the neoliberal model has been that we just weren't neoliberal enough, that the greed-is-good ideology has been undermined by excessive state intervention and that the state should be cut back and sold off in order to prevent "welfare" from undermining the free-market.

The Tories are opposed to state intervention to prevent social harm, and have been hell bent on reducing the role of the state via harsh austerity cuts, mass redundancies, privatisation sell offs and dodgy outsourcing contracts. Yet their concept of "the big society" stepping in to fill the gaps goes against their beloved neoliberal (economic Darwinism) theory. If their belief that the economy functions best without ideological interventionism, the charitable sector must also be seen as an obstacle to true-neoliberalism, meaning that the hardcore neoliberal would actually approve of measures aimed at reducing donations to charitable causes.

The Tories have always been the party of the rich, however this assault on charitable donations suggests that Osborne would prefer it if the rich would stick to the task of being greedy and completely self interested, rather than donating some of their excess wealth to charitable causes and undermining his beloved neoliberal economic system.

Either this "charity tax" legislation demonstrates that the government don't know what they are doing and won't rescind their mistakes because of political inertia, or it shows that they know exactly what they are doing, that compassionate conservatism is just so much PR guff to obscure their hard line neoliberal agenda and that the negative consequences of their actions for the poorest and most needy simply never come into Tory calculations.

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Thursday 5 April 2012

George Galloway, the "Muslim vote" and his far-right critics

As a preface I would like to express my personal opinion about George Galloway, to prevent people from thinking that my views here are some kind of biased pro-Galloway rant. I think the man is a bit of a buffoon with a questionable track record, but he is a fine orator and a politician of principle, in that unlike the vast majority of his political peers he actually seems to have any at all. I mean none of his principles seem to be particulary fashionable these days (sobriety, pacifism, renationalisation, direct funding of state infrastructure, increasing rather than decreasing the funding of education and research). Even if you completely disagree with his principles and/or loathe the man, it would be unfair to claim that he hasn't got any principles. To me this is the esscence of his appeal, Labour sold out when they betrayed their founding socialist principles and millions of their core left wing voters in the 1990s to enable their passionate embrace of corporatist neoliberalism, the Lib Dems volte-face on tuition fees utterly demolished their credibility as a party of principle and the Tories have only ever had one central principle, to protect the wealth, property and power of the rich establishment elite. The people of Bradford were looking for a person they could trust to not sell out and Galloway (of all people) was the closest aproximation they could find to "an honest politician".

On 29 March 2012 George Galloway (in his own words) recorded "the most sensational result in British by-election history, bar none". He overturned a massive Labour majority in a "safe seat" (political stronghold) they had retained since 1973, whilst representing a "minor" party without any sitting MPs. In this landslide victory he polled that largest post war percentage of a by-election vote and the second largest swing (52.8%) in by-election history. Aside from the remarkable statistics, the intensity of the shock was magnified by the fact that the Bradford West by-election campaign was barely even covered by the mainstream London based media. Only The Guardian even bothered to send a reporter up to Bradford to cover it. When the news of Galloway's victory broke in the early hours of the following morning the mainstream media commentariat and the political establishment were utterly taken by surprise.

I spent the following couple of days checking what the mainstream media and the below-the-line comments had to say, in order to gauge the press and public reaction to Galloway's amazingly comprehensive victory. It is understandable that in the wake of unexpected happenings, reactionary views become prevalent, since the mainstream media has not been able to coach the public in the political nuances of the subject. The most commonly occurring of these ignorant reactionary views seemed to be that "Galloway had won by pandering to the Muslim vote".

George Galloway celebrating his remarkable victory in Bradford West.
Firstly, this view demonstrates an unwillingness to consider the fact that huge numbers of people from all kinds of backgrounds voted for Galloway, disaffected white working class former Labour voters, students, non-muslim ethnic minorities and Bradford's massive swelling tide of unemployed young people. Secondly it ignores the fact that Galloway's Labour opponent, Imran Hussain was actually a Muslim and a prominent member of Bradford's Muslim political establishment.

This unwillingness to embrace the facts either demonstrates ignorance (which is almost acceptable in the immediate aftermath of an unexpected event) or a deliberate evasion of reality. Over the next few days these reactionary "Muslim pandering" accusations began to intensify rather than die down, becoming the de-facto official reactionary line on "that distasteful Galloway affair", demonstrating that either growing numbers of people were prepared to speak out in complete ignorance of the facts, or that the official "Galloway is a Muslim panderer" position relies on the deliberate evasion of reality and a distasteful underlying Islamophobic sentiment.

The idea that Galloway was "courting Muslim voters" can hardly be considered as a stand-alone criticism, after all, in Britain, a Muslim vote counts exactly the same as a non-Muslim vote. Anyone attempting to win election in a constituency containing many Muslims would either be a fool or a racist not to attempt to engage with the Muslim community. This is precisely the reason that representatives of all three mainstream political parties have paid their respects at local mosques, visited Muslim businesses, canvassed Muslim neighbourhoods and fielded Muslim candidates (such as Galloway's Bradford West opponent Imran Hussain). 

An overt appeal to Muslim voters is nowhere near enough to be considered as a stand alone criticism, so there must be something more to these Galloway "Muslim pandering" accusations, otherwise all of the other major parties would have found themselves at the centre of regular "Muslim pandering" storms of criticism over recent decades.

After several days of reading below-the-line opinions about Galloway's victory I was astonished when I finally came across a criticism of Galloway that actually bothered to mention and paraphrase the Respect party manifesto and completely avoided the subject of "the Muslim vote". I didn't agree with the criticism, because the guy was parroting the hackneyed neoliberal line that "the money has run out", therefore social democratic policies are an unaffordable luxury, but I have to give credit because the comment was the first one I found in days to base criticism of Galloway on the political issues, rather than on a blatant personal attack or an barely concealed anti-Muslim sentiment.

I find it quite amazing that such a high percentage of Galloway's critics choose to attack the man through association with Muslims, some going as far as to claim that "proper British people" don't really care about the Afghan war of occupation, and that "people that complain about it" are confirming their status as "permanent foreigners". This type of argument is nothing but a thinly veiled attack on British Muslims, relying on claims that their opposition to war makes them somehow "un-British", and that Galloway is a traitor and a charlatan for pretending to oppose the war in order to win the "Muslim vote". Once again, this is an argument that is made in ignorance (or deliberate evasion) of the facts, namely that the majority of the wider British population also oppose the Afghan war and above 70% consider it to be "unwinnable".

One of the recurring themes of the "Muslim pandering" smear campaign has been the repetition of the fact that Galloway openly stated his abstention from alcohol and then praised Allah after his victory. The reactionary response was to accuse Galloway of sectarian Islamist behaviour, however it must be remembered George W. Bush often spoke of how giving up alcohol had saved his life and referred to God on a near daily basis, and he could hardly be described as any kind of Islamist fanatic hell bent on creating a worldwide Islamist theocracy.

I lived in West Yorkshire for many years, just off Stanningley Road between Leeds and Bradford. I met many people there and feel that I have a decent understanding of the area and its various communities. I spoke with a great number of West Yorkshire's Muslims and found the huge majority to be genuine, respectful, hard-working family orientated people, who were mainly preoccupied with providing the best for their families. When speaking to people, I like to offer my respect and my honest opinion, I rarely met a Muslim who wouldn't reciprocate to create an atmosphere of mutual respect. 

Presumably, the anti-Galloway ranters
would prefer Bradford's protest vote to
go to the divisive racists at the BNP.
Through work I also met a number of West Yorkshire's far-right, BNP voting reactionaries, people completely incapable of understanding the concept of mutual respect. I often interrupted their ignorant, hate filled rants to demolish their arguments and expose the lies and distortions that they were content to believe and broadcast endlessly. The retort of the West Yorkshire anti-Muslim reactionary when confronted is to accuse their opponent of being a "Paki-lover". 

"Paki" is considered to be a grossly offensive racial slur, aimed at people of Pakistani origin, however the average BNP voting reactionary is so grotesquely ignorant that they use the word to mean anyone Muslim, or even anyone of west Asian origin. These racist wankers didn't care about the distinction between the various forms of Islam, or care that "Muslim" isn't an ethnic group, they just hated the "Paki bastards" and fantasised about mandatory repatriation schemes (or much worse) for their brown skinned neighbours. The term "Paki-lover" is offensive, but it was used against me so many times I almost felt compelled to make myself an "I heart NY" style "I heart pakis" T-shirt to wear to work, just to rile my racist work colleagues.

To my ears, this "Galloway pandered to the Muslims" rhetoric, sounds incredibly similar to the "Paki-lover" accusations I used to face, just with the underlying racist sentiment more carefully cloaked in seemingly acceptable language. The fact is that these kind of Islamophobic comments were to be expected from the reactionary outliers in the aftermath of Galloway's unexpected victory, but that "Muslim pandering" has become the most commonly heard criticism in the long term betrays a disturbinly widespread anti-Muslim sentiment.

Many of Galloway's critics defend their anti-Muslim stance through invoking the most famous technical clause of the racist armoury, that Islam is a faith, not an ethnicity. This allows the racist to believe that it is entirely within "the rules" to cloak their racially motivated antagonism towards the "Muslim community" in the language of a "reasoned" critique of Islam. The crux of their argument seems to be that "it is not racist to hate Muslims, because Muslims are not a race". That the vast majority of Muslims are also ethnic minorities doesn't deter them, and neither does the fact that there is no such thing as the generic and ubiquitous "Muslim community", that the divisive reactionary thinker considers to be "the enemy within", the "Islamic threat" or the "permanent foreigners".

Some of Galloway's reactionary critics have claimed that he represents some kind of dangerous fringe element, the left-wing mirror of the far-right racists. A reactionary attempt to slur Galloway by association with the far-right by opining that " the far left and far right are two cheeks of the same arse". 

There is so much wrong with this argument it is hard to know where to begin. I think that the first observation has to be that Galloway's views are hardly far-left. Forty years ago during the post war consensus mixed economy era, policies such as state administration of economically vital infrastructure (nationalised industries) were subscribed to even by the Conservative party (until their neoliberal revolution in 1979). 

Galloway is not far-left, he is a capitalist and a social democrat, it is just that the British political spectrum has shifted so far to the right, what was once a middle ground synergy of state planning and capitalist growth, a left-right compromise of a social democratic system, is now characterised as "the far-left", in the "loony left" territory once occupied by the British Communist party. 

This huge rightward spectrum shift is actually one of the main causal factors in Galloway's appeal, the fact that all three of the mainstream political parties have destroyed England's political plurality through their uniform embrace of neoliberal/corporatist economic ideology. 
Political outliers such as Respect on the left, and UKIP on the right may be fringe elements, however what they do have is clean hands. They haven't got proven track records selling off what remains of the state off to their mates, coddling the reckless gamblers in the financial sector, fiddling their expenses, increasing the wealth gap, gerrymandering the political system to their own benefit and pimping themselves out to the highest corporate bidders in order to earn future seats on the board/lucrative advisory positions to augment their hefty pensions, paid for by the state that they spent their political carers dismantling from the inside (through massive privatisation and outsourcing scams and regularly handing chunks of British sovereignty to a bunch of unelected neoliberal technocrats in Europe).

To simplify to the level of a crude metaphor, "Neo-Labour and the Nasty party are arse cheeks of corporate backed neoliberalistion, with the Liberal liars as the stinking arsepiece of Establishment politics". People are sick of the sight of this fat rump of bloated politicians and their astonishingly inadequate responses to the neoliberal economic crisis. The English people are desperate to find a replacement political ideology. 

If 20th Century history hasn't taught us that at as at times of extreme hardship that people have traditionally turned to reactionary far-right elements, it must not have taught us anything. The fact that a principled man, with a populist appeal has waded into a ethnically divided community in order to create a sense of unity and plurality is a noble thing. Not only is he providing the disillusioned voters with a genuine political alternative, he is promising to steal the ground from underneath the divisive far-right BNP racists (that my ignorant and deluded former work colleagues saw as their only alternative to an alien and unrepresentative political establishment) by standing Respect candidates in BNP hotspots such as Bradford, Dewsbury and Rochdale.

Although I can't classify myself as a Respect supporter, I believe that Galloway's victory could break open British politics. Given just the right strategy, I strongly believe that it is possible for other minor parties such as the Greens, the Angry Doctors, the regional parties and UKIP to launch similarly strong campaigns and wrest political dominance away from the three discredited neoliberal parties. 

It is utterly apparent that England is a political monoculture, with all three main parties promoting extremely similar variants on the ideologically driven neoloiberal heterodoxy. Scotland, Wales and Northern Ireland are fortunate in that they have much greater political plurality, whilst English politics has become the gerrymandered rump of the receded establishment empire in desperate need of reinvigoration.

The Respect party on the near-left and and Farage's UKIP on the near-right are far from ideal, but they both have strong central philosophies (an end to imperialistic wars of aggression and withdrawal from the grotesquely anti-democratic EU).  People like George Galloway, Caroline Lucas and Nigel Farage are at least capable of offering distinctly alternative political directions that do not resort to fascism and bitter accusations of "paki-loving".

See also

 If you enjoyed reading this post, maybe you could buy me a beer? £1 would get me a can of cheap lager whilst £3 would get me a lovely pint of real ale.