Poverty is a fundamental aspect of the market economy

Poverty is a fundamental aspect of the market economy. This assertion is frightening if true, and seems to be at the core of all radical critiques of capitalism. Are the problems of poverty systemic, a feature of the economic system in which we live, or, are they the result of bad decisions, easily corrected without real systemic change.

In order for markets to operate, prices must be set. The common understanding of how prices are set is via the law of supply and demand. The assumptions outlined in this system appear simple to us, in that we experience them every day. We even utilize them ourselves in a rudimentary way when we sell things at a garage sale, or post concert tickets on Craigslist. The need for an item as well as its relative scarcity work together to generate a price that seems fair to all parties involved.

Scarcity plays a large part in this. The relative levels of scarcity on a given day and in a given market are one of the factors that allow items to be sold above their cost of production. This is one of the ways profit is generated, as the relative advantage of a given capitalist can be used to sell objects at a price higher than its value. In short nobody buys sand at a beach.

In this way, a segment of the population must go without in order for the market mechanism to operate. Scarcity, and its human consequence poverty, are a requirement of functioning capitalist markets. How can wages be set if there is not a group of people looking for work. Who would pay for food if everyone had enough to eat.

In this sense, scarcity is manufactured to allow markets to operate. It does not exist in an absolute sense. If we can look beyond the economic system in which we live, poverty is not a question of scarcity, but rather a problem of the distribution of abundant resources.

The answers to these questions seem simple enough, yet solutions prove remarkably difficult. The slogan of the World Social Forum "Another World is Possible" comes to mind, however the world around us works to make imagining this world as difficult as possible.

The Best things in Life are Free - By Andrew Harvey

There may be no truer statement.

Take our relationships with others, which outside of a few notable exceptions such as prostitution, have no monetary cost. The most rewarding things in this world come when we escape the nearly omnipresent grip of money. Take, for example, volunteering. When you freely give your own time, and have complete control of where you devote your efforts, the rewards far exceed anything money could offer you. The benefits of free giving between people is where the salvation of our world lies.

Every time you stop to hold the door for a stranger (or your best friend), pick up a piece of garbage, donate used clothing, time, or yes, even money, you are disproving all of the nay-sayers that say socialism cannot work. The biggest step in people acceptance that we can live in a world without money is convincing them that there is a possible alternative. Instead what we should do is to look at the many ways in which this world has existed without money since the least hairy of the apes stared walking together.

Of course there has been money, barter, or trade since we have started gathering in groups, but was this for the better? What about all the ways in which we never needed money? Family, community, and friends have always existed, usually managing to stay away from the divisive nature of money, and always for their detriment when they have failed to do so.

Sure we have had money for a long time, but who were the ones who decided we needed that? It was those who were in power. The ones who needed to create a monetary system in which they could measure and place an arbitrary value on everything. By measuring and assigning values to the things which we use, it removes the inherently communal nature of the world around us, by classifying items as “property”.

What I am getting at is that we are all in this together. This is another truism, which I have yet to hear a rational argument against. When it comes down to it, everyone, and everything in this world, are linked. Most places in this world have created a intricate series of classifications to divide us as people: governments, monetary systems, gender, class, religion and race (to name a few). When it comes down to it, these are all meaningless. They are imaginary social constructs that only have power because we continue to legitimize them by using them, and rigidly enforcing them in our social order. Our society (globally, and especially western-ly) continues to give these systems of exploitation and division power by ensuring that they persist.

Why? Money.

Money equals power in capitalism, and so long as 10% of the world controls 85% of it’s wealth, this will not change. The richest in our society have it in their (perceived) interests to maintain the status quo. Capitalism requires a perceived scarcity of resources to fuel the competition and inequality which it produces. When we are divided as people, in all the ways we are, we can perceive this inequality, and then seek to out-compete the “other”. This competition leads to an animal ferocity towards each other, and this world. We have been tricked by each other, and the media, into believing that our “needs” are not met. In western society we have more wealth than the other 70% of the world could ever imagine, but still feel the need to consume at ever-increasing rates. We work ourselves to the point of stress-induced illnesses, while keeping our neghibour, and fellow people across the world conditions we would never allow our $800 dog to live in. The perception of “need” in our society can include new game consoles every other year and new iPods every single year, while next door, across-town, or on the other side of the world “need” includes clean drinking water, and food that would cost what we tip our barista each morning.

This local, and global inequality is what leads to crime, national tensions, and the ravaging of the world, and the vast majority of it’s population for the benefit of the tiny minority.

Now that I have convinced you we should immediately abandon money, and embrace the glorious boosum of socialism, here is what we can do:

• Stop letting money come into our lives in whatever ways possible, stop paying prostitutes for company for one.
• Give yourself. In whatever ways you can think of. Volunteer your time, make sure you are there for friends and strangers when they need you.
• When you must use money, ensure that it goes somewhere where it will be more equitably distributed, i.e. fair trade. This also means DON’T GIVE MONEY TO BIG CORPORATIONS. Corporations are massive organizations of exploitation which use their size, and leverage to “outcompete”, and undercut smaller, more local, fairer companies which spread the money around more.
• Join a co-op. Any co-op you can. If one does not exist where you live, start one. Start on a small scale. I am not talking about the business designation the government has created necessarily, I mean starting with two families buying bulk rice together to save money. Any step we take together is a step in the right direction.
• BE NICE TO EACH OTHER. Stop acting like it is us versus “them”, whoever “them” might be. Smile at people, hold a door for someone, unplug your earbuds, and start a conversation on the bus with a stranger. You will find we all have a lot more in common than you think.

There are many other ways to do what I am talking about, but this is a good start.

I love you all people. Lets start fixing this world together.

More thoughts about Money

While the statement "Money is the root of all evil" has some truth. The current form that money takes under capitalism is very different from that which existed in pre-capitalist times. When people say we have always had money and always will, they are misinformed. Feudal society may of had money, but it was a minor factor in the overall economic system. Most economic relationships in feudal society where mediated by kinship bonds, religion, and other factors, rather than by the almighty dollar. Money was used by very few wealthy people and the vast majority of people would have little contact with it, day in and day out.

However, under our current economic system (capitalism) money, has become a means in and off itself. It is currently impossible to function successfully without money. The role that money plays as the "universal commodity" is a major factor in the daily exploration, human misery, and inequality we witness all around us.

What is the purpose of money under capitalism? One would imagine it is to purchase the goods/services you need to survive. You work a job, get paid, and then use the money to rent a house, buy groceries and live your life

While this may be true for the majority of us. If you are a business owner or investment banker (re: capitalist) this is not the case. People in these positions no longer need money to purchase things, but instead use things (commodities) to get money. As the universal store of value, money is better than things. Even with Hummers, Rocket Cars and Solid Gold Houses there is a natural limit on the amount of stuff that can be owned/used. However there is no limit to the amount of money one can have.

Additionally, money can be put to use to generate more wealth. Through the purchasing products for sale, investment in production, lending at interest, and the multitude of other methods which exist under capitalism to generate wealth, money is the ultimate factor in generating more money. In fact money must be used in this way, as, left to its own devices, it will loose value over time.

This never ending cycle is what drives the capitalist system. It creates the need for ever expanding compound growth. Additionally, it sets people against each other by creating an endless competition to generate the most money from the least amount of starting money.

This relationship leads directly to the explotation of working people. If the goal is to have more money at the end of the day then you did at the begining there are only a few ways to do this. The most classic method is to employe people to turn raw materials into more finished goods that you can sell at a profit. Even with all the technological wonders around us human labour remains the only way to add value to a given process. At some point people must work to turn raw materials, concepts, and technological processes into an object that can be sold for a price. By exploiting the ability of people to create things, selling them at a price higher than the cost to create them, capitalists extract value from working people. The cheaper this can be done, and the less you can pay people to do it, the more profit is to be gained, and the more efficient your process of transferring money, into commodities, and back into more money will be.

Money in its current form is both a biproduct of the current economic system and an essential element of its success, while doing all we can to minimize our reliance may be a useful symbolic gesture. They key remains to dismantle the system that relies on it and replace it with something that does not have the exploitation of working people at its base.

Greece, Ideology, and Social Power

Here is an interesting article from the Economist concerning Greece.

I have been following this situation fairly closely, and although you wouldn't know it from watching the news/or reading the local paper, this situation is one of the key economic problems facing the world today. I believe this situation provides a window into the future and depending on how this situation is dealt with the problems in Greece have the potential to spread rapidly, with (additional) disastrous consequences for poor/working class people around the globe.

The problems in Greece are two fold. Due to its high level of public debt, deficit spending, and a relatively weak economy, Greece is having trouble raising money on world capital markets. The fear is that Greece will be unable to service its debt in the future, leading to a default, and lost profits to all those capitalists/governments who lent Greece money in the first place. In short, Greece is not a good long term investment, and is increasingly unable to finance government operations.

This has lead the Greek government, under pressure from those same world markets as well as the EU, to introduce increasingly draconian measures to curb public spending, and reduce its need to borrow additional money. The list of these measures is quite extensive but it includes among other things huge cuts to the public service (including massive layoffs and in some case up to 25% wage reductions), increasing the retirement age, and significant tax increases. This has lead to both internal duress and mass protests on the part of the Greek people, in addition to endless debate among the EU about how best to deal with this situation, and wether or not to provide some sort of financial relief to the Greek government.

What makes the situation in Greece particularly interesting to me is that it provides an acute example of two of the big problems facing the world today. As well as a remarkably clear example of Capitalist ideology at work. The two problems that the situation in Greece demonstrates are;

1. The erosion of state power, and its ever weakening position visa vie world Capital Markets/Capitalist Power

2. Economic Fatalism, or, ignorance of the economy as a political and social process.

Upon first glance, it seems easy to criticize Greece. Even without employing ethnic stereotypes, and believe me this discourse does play a significant role in the media's coverage of these events, it would seem that comparatively Greece has a relatively developed welfare state and a large public sector, without the economy to back it up. In a sense Greece is living beyond its means. In this discourse these austerity measures are simply a correction. A time for the Greek government to come to its senses and start acting like the rest of us.

However, this "critique" is fundamentally ideologically. It only serves to engage regular people in a fight with each other over table scraps while the rich make 3.6 billion dollars a year to steal from people and drink martinis on Wall Street. Rather than focus on the true nature of the problem, global income disparity of epic proportions, we blame the lazy Greeks for their decadent lifestyle.

And here is the one of the true problems that the Greek situation exemplifies. The various financiers and stock traders of the world have been able to force Greece into enacting policies directly against the interests of their citizens. Greece has been placed in a situation where the interests of private profit and finance capital trump the interests of regular people. The state, maybe just the Greek state but maybe all states, no longer has the ability to govern. Government is now performed by the financial market.

Secondly, if the above quoted article is correct, 2/3rd's of the Greek population support the governments austerity measures. They have bought the line and believe that, as the market dictates, they must pull up their boot straps and soldier on to rebuild their economy, loose the benefits they fought and died for, in the hope that, one day they can once again have the lifestyles the so recently possessed.

The austerity measures being enacted are not the dictates of the market, but rather the direct workings of human beings. The economy is a social process run by, and one would imagine for, people. There is no invisible hand whisking money around by some mystical force but rather the conscious decisions of individuals.

In this case, the people in question are not working for the public good, but rather in the interests of private profit. Explicit in the idea of the economy functioning as a social process is the idea that we can change it. As its only actors, humanity must work to create an economy where the interests of human beings are placed above those of interests rates, and balance sheets.

We have allowed the world to become what it is, and we are the only people who can, working together, change it for the better.

Fredric Jameson in Vancouver, or, Why we can't have World Politics

On Thursday night I was able to attend a lecture by renown literary and cultural theorist Fredric Jameson This was more exciting due to the fact I am in the process of reading his latest book; Valences of the Dialectic. I found the talk very enjoyable; it was clear, concise, and provided a good introduction of Jameson's views on postmodernism (or post-modernity as he would prefer).

To Jameson, post-modernity is a product of the current stage of capitalist development. Post-modern society is a symptom of changes in the mode of production, particularly, the move from industrial/production capitalism to finance capitalism. Also, and I believe very important to an understanding of Jameson's argument, is while these ideas are products of late-capitalism this does not provide us an excuse to dismiss them outright. Rather we need to engage with them dialectically.

Throughout the talk, Jameson gave numerous examples of how post-modernity is represented, in art, politics, and economics, as well as a brief outline of some the key features of post-modernity. One particular idea that he focused on was that of the "singularity." Particularly as it is represented in financial derivatives.

A financial derivative is a combination of financial instruments designed primarily to mitigate risk. (An instrument of instruments!) In this sense derivatives are a singularity. They represent a coming together of financial instruments, at one time, and for one specific purpose. Consequently, they remain next to impossible to regulate as each one is a unique set of relationships designed for a specific purpose. Another example of singularities referenced by Jameson were art installations, which have a similar uniqueness in regards to their position, within time, space, & human understanding.

While the term singularity may be an apt description of Financial derivatives and the kind of relationships currently produced under finance capitalism. It is ultimately unsatisfactory politically. Towards the end of the talk, Jameson discussed the current difficulty we have conceptualising contemporary society in any meaningful way. His evidence of this fact was that we do not properly have a world politics. In a world of globalization, complex one-time only financial instruments, and the immense power of finance capitalism our current conceptual frameworks do not allow us to organize in any meaningful way. In short, we are stuck with the political tools of modernism while trying to effect change in a thoroughly post-modern world.

How then does an awareness of these "singularities" help us in this regard. I would argue that it doesn't. It may provide us with a description of what is going on, but does nothing to assist us in conceptualizing and understanding financial capitalism. I am curious as to whether Jameson believes this task is possible, or even desirable, with his clear distrust of concepts, grand-narratives, and his denial of both universals and particulars.

Hopefully, reading his most recent book will shed some additional light on these matters. However, if Jameson is right, this leaves us with two options. Either contemporary capitalism has become so complicated that we will never be able to conceptualize it in a way that can provoke meaningful change, or, we haven't done it yet and are too busy chasing our tails to proceed on this task in any meaningful way.

Sooooooo....in conclusion, don't chase your tail as you may get bit.

Federal Budget Time

I had planned on doing a rant about the recently proposed federal budget, but as my good friend Andrew has already done it here. I've decided to be more positive.

While, this years federal budget is predictably dour, each year the Canadian Centre for Policy Alternatives presents an alternative budget which is of late has been a much better read. I like the Canadian Centre for Policy Alternatives, although far from challenging capitalist discourse, they are one of the few mainstream organizations in Canada that offer concrete tangible policy alternatives to the standard neo-liberal line spouted by seemingly everyone. (A surprising fact given their name).

Here are a couple factoids, concerning this years federal budget strait from the CCPA. Remember these the next time Steven Harper says that there is no money to pay for essential social programs:

• Canada is one of the top 15 military spending nations in the world, and our current spending is higher than Cold War levels


• The current budget includes at least $5 billion in corporate tax cuts, even while Canada has some of the lowest corporate tax rates in the OECD.

If you want to read more here is the link to the CCPA's annual "alternative budget. " After reading something like this its amazing to see the lengths that the government goes to not do useful/helpful things and instead focus on reducing the size of government, cutting corporate taxes, and facilitating private profit to maintain its bone headed, ideological, and patently false agenda.

http://www.policyalternatives.ca/sites/default/files/uploads/publications/reports/docs/AFB%202010%20Budget%20in%20Brief.pdf

Also, in a hopelessly bureaucratic vein, I am appalled at the budget documentation provided by the federal government. At the very least they should provide a year over year comparison, as well as a detailed list of expenditures by department/object. This information exists and should be provided to the public. I will hope that it is on its way as I have far to much sympathy for the work involved in preparing this kind of documentation.

Why is Capitalism So Hard to see?

The current state of global capitalism is remarkably strong. To loosely reference Slavoj Zizek, perhaps the best example of this can be seen in the retreat of the term itself from common usage. Capitalism is no longer seen as an economic system, one among many possible methods of organizing society, it is instead taken as a complete given. It is the white of the page rather than the text itself.

The Olympics provided a wonderful example of this op ache nature of capitalist relations. Even as they have been a time of civic celebration at no time has the City of Vancouver been less "public" and more private/capitalist than it was during the Olympics.

VANOC and the IOC managed to exerted near complete control of the public space. Through an immense police presence and strong armed legal tactics they managed to turn Vancouver into one large advertisement for Olympic sponsors . Even the air space has been privatized, as VANOC has managed to fine people for projecting unwanted advertising through air that they "own." Additionally, how much was the security presence necessary to protect us from terrorist threats, or was it designed to keep "undesirable" people out of what was once public space.

However, during the event itself it was remarkably easy to forget these facts. Glossed over by so much nationalist fervor and good time spirit the last thought on any ones mind was the capitalist accumulation and the reinforcement of capital social relations taking place all around them.

We have a long way to go if we hope to enact positive social change in this world. However, step one remains recognizing the world for what it is, and the capitalism system for just that a system; created by people, temporal, and subject to change. The world we live in was created by human beings and can only by changed by human beings. Every day our daily ritual works to reinforce capitalist social relations and until a larger group of people realise this we have no hope of changing it.