What I Live For

The final chapter of Home From Nowhere
(Simon & Schuster, 1996)

by James Howard Kunstler

12 Coda


There are times I feel so fortunate that I wonder if I am making up this life as it as it traces its mysterious arc through time. Solipsism is not a very attractive philosophy - especially in others - but such good fortune as I've known seems improbable to one who otherwise doesn't believe in dumb luck. Were I beset by catastrophe tomorrow, I could still say that I lived 47 pretty good years. In terms of sheer bulk chronology, I've outlasted George Gershwin, Jesse James, Lord Byron, Wolfgang Mozart, Martin Luther King, Jesus Christ, Huey Long, Lou Gehrig, Stonewall Jackson, Fats Waller, John F Kennedy, F Scott Fitzgerald, and one of the Beatles - and a few of these characters were far more beset by troubles in their short lives than I have been so far.

The world is full of terrible places where life is everything Hobbes said and worse. For all the shortcomings I perceive about my homeland these days, I must admit it has allowed me to function freely in my vocation, which is saying a lot. The only conditions I value more are loving relations with friends and kin and a more generalized gratitude for being born in the first place. I am not religious, but I am aware of a spiritual dimension to this mysterious world. As Wittgenstein remarked, it is astonishing that anything exists. I believe we pass this way but once, and that this is the source of man's essentially tragic condition. Yet I believe simultaneously, perhaps incongruously, even obdurately and foolishly that each of us is an offspring of the intelligent and benevolent organism that is the universe - though this model leaves a lot unaccounted for, from war to root canal therapy - and that we remain part of it, in some fashion, everlastingly.

My ancestors were mostly Jewish - the exception being my great-grandmother, a German Christian - but my parents observed none of the Jewish rituals or holidays. They prayed to the Sunday Times crossword puzzle. In our house (or apartment following their divorce and subsequent re-marriages) there was always a Christmas tree, and up to the age of six I received chocolatey visits from the Easter Bunny, with no idea that he died in anguish on a cross for me. For all that, my parents are not the kind of Jews who pretend that they belong to the Swindon Hunt Club. They are cultural Jews, emphatically of the New York persuasion. A lot of yiddish slang is flung around, mostly for comic effect. "That forbissina face!" "What a farkokteh idea!" Anyway, Judaism is more about human conduct than eschatology. I was therefore raised in what might be described as a religion-free household. Strange to relate, as a result of my travels around the United States the past seven years, I begin to come to the disquieting conclusion that we Americans are these days a wicked people who deserve to be punished. The idea embarrasses me, but I nevertheless stand by it. I suppose this is what comes of a vocation that places one, for instance, in a New Jersey gambling casino full of overweight slobs pissing away their kids' college tuition in pursuit of "excitement". I therefore also believe in the existence of genuine evil, as embodied, in the Hannah Arendt sense, by the behavior of many well-known American corporations, especially those that prey on the aspirations of children.

Perhaps in consequence of my singular theology, I have rather robust notions about right and wrong. They proceed also from the issue of personal honor, which I define as meaning what one says and vice versa. To my way of thinking there are few personal virtues more important than being reliable in this sense. As for kindness and generosity, I suspect they derive as much from disposition as culture, and all it takes is a glance at the Saturday morning TV shows to see how these matters are treated at the cultural end in our time. Experience has disposed me to be kind in my personal dealings and severe in my professional ones. For instance, the culture of business, including the literature racket, has decayed in step with other things in America, and the common decencies are seldom observed nowadays. Phone calls are not returned, letters not answered, checks not sent, agreements not kept, and I get rather irked by all this. I squawk about it to the amazement of my associates and representatives. The idea that business relations might be regulated by standards of decency makes them howl with laughter. I believe that standards rise and fall in cycles and that the time will come again when personal honor means something. I hope I live to see it. Luckily, that is not all I live for.

I live in a little gray 1820s cottage with Jennifer Armstrong, an author of children's books. By the time this book is in print, we will be married. We have two dogs, a cat, and a canoe. Our house is about a two-minute walk from the town's main street, with all its wonderful attractions. My daily life is shapely and pleasing. I shape it by observing some self-discipline and am pleased by the results. I'm not a nut about it, but self-employment does call for a certain rigor. I believe Flaubert's dictum that if you want to be wild in your art, you must be bourgeois in your life. I keep regular hours. I commute 27 seconds by bicycle up the street and across a square to my office, which is a ground-floor apartment in an 1850s building that was once a hotel. I usually get in before 8:30, depending on the traffic, har har.

I enjoy writing. I don't suffer from blocks. I have enough ideas for books to keep me busy for the rest of my life. Yet writing is not easy. I struggle to produce three decent pages a day. It's like making bratwurst under an electron microscope. Nevertheless, I amuse myself. The operations of my own mind entertain me hugely. To avoid over-indulgence in that dubious realm, therefore, I get out of here around noon, rain or shine, summer or winter, and run three miles with the dogs. I eat a miserable, abstemious lunch of an apple and a banana as a weight- control measure - since, in middle age, one develops the metabolism of a garden slug. I compose sentences and paragraphs all afternoon, sipping green tea. At five o'clock I bike over to the YMCA and swim a mile in the pool to sweep all the bratwurst scraps out of my skull. I am fortunate once again in not having to spend any portion of my day sitting in a car, commuting, as tens of millions of my countrymen do, including many of my friends.

I own a 1992 Toyota pickup truck, but it sits in its parking space on the street for days at a time because most of what I need is within a one-minute bike ride of both my home and office. I exercise a lot because I like to cook and eat. My idea of bigtime fun is to make dinner for eight of my friends and get a little looped on cheap champagne in the process. I almost never work on weekends or evenings.

I never made more than $15,000 in any one year until well after I turned forty. I arrived in this town twenty years ago on a motorcycle from San Francisco after dropping out of the journalism business to write books. I settled here because, before California, I'd worked for a year on the nearby Albany newspaper, and gotten to know Saratoga, and it seemed like a good place to be a starving writer of books nobody had asked to be written. Through the 70s and 80s, I worked a lot of odd jobs, from orderly in the psychiatric wing of the hospital, to digging holes for percolation tests in housing subdivisions. I lived on brown rice and onions for months on end. It was a stringent existence but there were many compensations. I had that motorcycle (and two successors) and a flyrod and beautiful countryside to ramble in, and I made a lot of friends in town.

Over the years I pounded out eight novels. All of them were published and all of them were commercial flops in any meaningful sense, apart from their literary merit. I picked up some Hollywood option money on most of them. My first novel was optioned thirteen times. The options amounted to a couple of thousand dollars each, spread out over two decades: chump change. None of my books were made into movies. These old novels still turn up now and again in the discontinued merchandise bin at the K-mart. It's like finding a beloved relative in the gutter clutching a bottle in a paper bag.

In 1987, I took a badly-needed sabbatical from fiction-writing and returned to journalism with a series of stories for the Sunday New York Times Magazine about land development issues. These led to a proposal for a book that would become The Geography of Nowhere. I had no particular credentials for the job, which proved to be an advantage, since so many problems with our everyday environment are caused by the over-specialization of trained specialists unwilling to look at the bigger picture beyond the narrow purview of their specialty. It was a worthy task for a generalist.

The Geography of Nowhere was moderately successful. It seemed to help people understand their feelings about a subject that had long bewildered them. I became something of a low-grade guru. I received many invitations to speak to civic groups, professional organizations, and colleges around the country. My initial reaction was panic that people were looking to me for illumination. What could be more natural than to feel unworthy of other people's esteem? I am aware that many successful figures secretly feel like frauds, including people far more knowledgeable and accomplished than myself. This is apparently a universal neurosis. Everybody feels inadequate. I've since formulated a social principle called Kunstler's Law, which states that in any room containing 100 people, 99 of them each think that they are the only one in the room who doesn't have his-or-her act together.

In the face of this I decided to take my role seriously and do my best to be helpful, accepting the risk of the public arena that some people will see me as an imposter, a blowhard, or a fool. I think I give a good lecture. I speak with conviction. I believe it is a sin to bore an audience. It happens that I majored in the dramatic arts in college and my training as an actor helps. I understand the nature of a performance. An audience doesn't hunger for the truth so much as for authenticity. They know the truth can be slippery. Their hopes and dreams are something else.

I believe that rhetoric is undervalued these days. My own generation had much to do with devaluing it back in the 60s, when all public talk seemed mendacious. Part of what I do these days is an attempt to resuscitate rhetoric as an honorable and worthy feature of public life in this country. I am sensible that rhetoric sometimes changes the world. It frightens me to be in possession of it.

As a writer, though, I see myself primarily as a prose artist, not as a retailer of Big Ideas. I think the success of The Geography of Nowhere was due as much to the shapeliness of its prose as to any ideas it contained. Sooner or later, I intend to leave this subject behind. I have other fish to fry.

It is mid-September as I write, one of the last days before summer's end, a time of year that feels analogous to the position of my little life in its orbit around a greater wheel of time. In a while, I will gather up my French easel and a newly-stretched canvas and head over to the Hudson River in my pickup truck with the canoe on the rack. The state is rebuilding the highway bridge at Schuylerville and there are several bright red work barges with cranes moored under it. I want to record the scene while all that equipment is still there. I spend most of my free time painting out in the open air. It is very important to me and I am very serious about it. When I am outside painting, I feel most in love with this world. I have a notion that writers burn out in their sixties but painters keep going to ninety or more. I love the idea of Monet pottering around the garden in his old age.

I feel an obligation to paint the landscape of my time, so I often paint highways with cars on them and even roadside monstrosities like McDonald's and K-Mart. I especially like the contrast between the artificial light of their electric signs and the natural twilight in the background. The result on canvas is oddly beautiful, but of course what's left out is the roaring traffic and the smell of exhaust fumes. One time a few years ago, I was painting a McDonalds with my easel set up across the highway in a bark mulch bed in the parking lot of Burger King. I was well underway when the manager bustled out and barked, "That ain't allowed here!" I dared him to call the police. I would have loved nothing better than to be arrested for painting. I assured him that the ensuing court case would be great publicity for Burger King, too. Eventually he skulked back inside to his fry-o-laters, and that was the end of it. Today, I'll happily forego that kind of amusement. I'm after tranquility, solitude, and fresh air. So it's off to the river on the most beautiful day of the year. Yippie.

This is the essence of my private life. This is what I live for. I want to paint some more pictures and write some more books. I want to make my girl happy. I want to throw more Christmas parties and put on more Saturday night feeds. I want to learn how to read sheet music. I want to keep running with the dogs. I want to live in a nice town in a civilized country. I want to remain grateful for being born.

The End

Copyright 1997 James Howard Kunstler

http://www.kunstler.com/excerpt.html


Bill Totten http://www.ashisuto.co.jp/english/

Our Very Own Enron?

Is the private finance initiative melting down?

by George Monbiot

Published in the Guardian (June 28 2005)

For how much longer can this farce carry on? Everywhere, the chickens released by the government's private finance initiative are not so much coming home to roost as crashing into the henhouse and sliding down the wall in a heap of blood and feathers. The prediction made in 2002 by the Banker magazine - that "eventually an Enron-style disaster will be rerun on a sovereign balance sheet" - could be starting to materialise. <1>

The private finance initiative (PFI) is the scheme allowing private corporations to build and run our public services and lease them back to the government. The government says that this allows it to commission more schemes than it could with public funds, and offers better value for money. And it doesn't seem to matter how often the story falls apart.

Last week, after spending GBP 14 million on lawyers, consultants, architects and miscellaneous money-wasting schemes, the National Health Service ditched its plans for a massive hospital in west London. The projected cost of the Paddington health campus had risen from GBP 360 million to GBP 1.1 billion, while the number of beds had fallen from 1000 to 800. <2> This is pretty normal for a PFI scheme: in one case I've studied, beds fell by 20%, while costs rose by 1100%. <3> What makes this instance unusual is that the project was dropped before the money was spent.

On Wednesday, the government admitted that PFI projects for council house repairs had been a costly disaster. <4> This is hardly news to anyone who has been watching this programme's seven-year meltdown. <5> But despite its admission, the government has not officially scrapped the policy: councils are still being told that they will receive no new money for refurbishments unless they hand their houses over to the private or voluntary sector.

On the same day, we discovered that the PFI computer system which is meant to keep a record of MoT test results for cars in the UK has been delayed by another year. It was supposed to have been ready in May 2002. <6>

On June 17th, Scottish ministers decided it was cheaper to spend GBP 25 million buying out the private financiers who built the Inverness airport terminal than to let them carry on. In six years, the corporations had made GBP 8.5 million on an investment of just GBP 5.5 million. <7> This is a photocopy of the Skye bridge bail-out: it was bought back by the Scottish Executive last year for GBP 27 million. A bridge which should have cost GBP 15 million has hit the public for GBP 93.6 million. <8>

Two days before the Inverness announcement, the Ministry of Defence quietly dropped a GBP 1 billion PFI scheme for military training. It didn't disclose how much money it had spent developing it. <9>

On June 14th, a leaked government report revealed that so many corners have been cut in the construction of a GBP 47 million privately financed mental health unit in Leeds that it might have to be pulled down and rebuilt. <10>

On June 10th, the National Audit Office published a report showing how the companies which had built the Norfolk and Norwich hospital had, as well as making stupendous profits, legally walked off with an additional payment of GBP 73 million, by exploiting the gap between the financial risk the government said they had taken on and the risk they had really shouldered. <11> It wasn't as if the government didn't know this was coming: in June 2001 a summary of leaked documents published in this column showed that this was going to happen. <12> The Treasury sat back and watched.

On June 9th, the Health Service Journal published an extraordinary admission by a senior civil servant in the Department of Health. PFI deals, Bob Ricketts revealed, were locking the NHS into thirty-year contracts for services which might become useless in five. "I've seen some awfully grand PFI schemes", he warned, "that are starting to give us a real problem". <13>

So what has the government learnt from all this? Nothing. It is ideologically committed to part-privatisation. It won't disclose how much it is planning to spend on PFI schemes in the future - a spokesperson at the Treasury says this is "commercially confidential" <14> - but it has already commissioned GBP 3.6 billion of new deals for this year. <15> According to a spokesman for the Department of Health, "The government has no intention of abandoning PFI". <15> The heap of blood and feathers, though brain dead, keeps running.

So the government fobs us off with spin, misreporting and lies. PFI, the Treasury tells us, "is a small but important part of the Government's strategy for delivering high quality public services". <16> Small? GBP 42 billion has been officially committed so far. <17> This, according to the public-spending specialist Professor Allyson Pollock, is an underestimate, covering only the 43% of PFI contracts classified as "off balance sheet". <18>

Less true still is the Treasury's assertion that there is "no bias in favour of any particular procurement route". <19> As people working for NHS trusts and local authorities will testify, the government has made it clear that for certain kinds of projects, public funds are not available.

But the biggest lie involves the government's claims of value for money. "All PFI projects", the Treasury says, "were delivered within public sector budgets ... no construction cost overruns were borne by the public sector". <20>

Well, it's a bit like hospital waiting lists: it depends when you start counting. The genius of PFI is that the overruns take place before the project begins. There are three ways in which this happens. The first is that the schemes are tailored to suit the private sector. Where public money might have been used to renovate a hospital, PFI demands that it is pulled down and rebuilt. <21> But the two costs are not compared: instead we are told we have a choice between rebuilding it with public funds or rebuilding it with private funds.

Then the next fiddle kicks in. Civil servants, knowing that, as the former secretary of state for health announced, "it's PFI or bust", <22> must mash the "public sector comparator" figure to show that PFI delivers best value for money. As Jeremy Colman, at the time the UK's assistant auditor-general, said, "If the answer comes out wrong you don't get your project. So the answer doesn't come out wrong very often." <23> The third fiddle is that the concept of "risk transfer" can be used to come up with any figure you want. You simply announce that x million pounds of "financial risk" is being transferred by PFI to the private sector, and hey presto, it's x million pounds more expensive to build the project with public money. <24> As the Norfolk and Norwich fiasco shows, the risk costing bears no relation to any actual hazard taken on by the contractors.

Is it an exaggeration to say that we might be facing "an Enron-style disaster" in the public sector? I don't know. But there's something familiar about Jeremy Colman's warning that the "pseudo-scientific mumbo jumbo" behind the private finance initiative's financial modelling "takes over from thinking. It becomes so complicated that no-one, not even the experts, understands what is going on." <25> And the record of the past three weeks is hardly reassuring.

www.monbiot.com

References:

1. Nick Kochan, 2nd August 2002. Is the PFI about to hit the buffers? The Banker. http://www.thebanker.com/news/fullstory.php/aid/224/Is_the_PFI_about_to_hit_the_buffers_.html

2. Mark Gould and John Carvel, 21st June 2005. Plan for super-hospital scrapped after eight years and GBP 14 million. The Guardian; Mark Gould, 15th June 2005. Watery grave. The Guardian.

3. This is the Walsgrave hospital, whose story is told in George Monbiot, 2000, Captive State: the corporate takeover of Britain. Macmillan, London. The figure later rose (from an initial GBP 30 million) to GBP 330 million.

4. Matt Weaver, 22nd June 2005. Government admits problems with PFI home repairs. Guardian online. http://politics.guardian.co.uk/homeaffairs/story/0,11026,1512021,00.html

5. Eg, No author, 10th June 2005. Refurbishment PFI must stop. Inside Housing.

6. Andy McCue, 22nd June 2005. MOT computerisation PFI project delayed again. Silicon.com. http://management.silicon.com/government/0,39024677,39131366,00.htm

7. John Ross, 18th June 2005. PFI fiasco as public foots airport GBP 33 million bill. The Scotsman; BBC Online, 17th June 2005. Ministers ground airport PFI deal. http://news.bbc.co.uk/1/hi/scotland/4103178.stm

8. George Monbiot, 28th December 2004. A Scandal of Secrecy and Collusion. The Guardian. http://www.monbiot.com/archives/2004/12/29/a-scandal-of-secrecy-and-collusion/

9. Reuters, 15th June 2005. Government drops army tank training deal.

10. Grant Woodward, 14th June 2005. New mental health units 'at risk from fire', says report.
http://www.leedstoday.net/ViewArticle2.aspx?SectionID=39&ArticleID=1054743; David Hencke, 17th June 2005. Private-finance hospital 'putting lives at risk'. The Guardian.

11. The Comptroller and Auditor General, 10th June 2005. The Refinancing of the Norfolk & Norwich PFI Hospital. National Audit Office.
http://www.nao.org.uk/publications/nao_reports/05-06/050678.pdf

12. George Monbiot, 5th June 2001. Bleeding Us Dry. The Guardian. http://www.monbiot.com/archives/2001/06/05/bleeding-us-dry/

13. Cited by John Carvel, 9th June 2005. Hospital building scheme 'mistaken'. The Guardian.

14. Conversation with press officer at the Treasury, 27th June 2005.

15. See Budget 2005. Corrections to tables C17 and C18. http://www.hm-treasury.gov.uk/media/C5A/E2/bud05_correction_c17c18.pdf

16. HM Treasury, viewed 25th June 2005. The Private Finance Initiative (PFI)
http://www.hm-treasury.gov.uk/documents/public_private_partnerships/ppp_index.cfm

17. Conversation with press officer at the Treasury, 27th June 2005.

18. Allyson Pollock and David Price, July 2004. Public Risk for Private Gain? Unison, London.

19. HM Treasury, July 2003. PFI: meeting the investment challenge. HMSO, London.

20. ibid.

21. George Monbiot, 2000, Captive State: the corporate takeover of Britain. Macmillan, London.

22. Alan Milburn, quoted in the Guardian, 4th July 1997.

23. Quoted by Nicholas Timmins, 5th June 2002. Warning of 'spurious' figures on value of PFI infrastructure spending. Financial Times.

24. See Allyson Pollock and David Price, ibid.

25. Quoted by Nicholas Timmins, ibid.

http://www.monbiot.com/archives/2005/06/28/our-very-own-enron-/


Bill Totten http://www.ashisuto.co.jp/english/

Clusterfuck Nation

Comment on current events

by Jim Kunstler (www.kunstler.com)


Lahar Rules (June 27 2005)

The east coast is a steambath, the Dow Jones is tanking, oil has crossed the $60 barrier, and Don Rumsfeld says the Iraq insurgency could run for twelve years.

Taking these things in reverse order - why twelve years? Why not forever? Actually, twelve years might as well be forever. What Rummy seems to be saying to the US public is: better be prepared to keep Fort Apache going indefinitely. The part he left out was ... "if you want to keep making that eighty-mile round trip commute from Cherokee County to Peachtree Street".

Even that simple equation assumes a lot. For instance, that Mr Suburban Atlanta Commuter will still have that job in the office tower on Peachtree. Or that he can continue to make a monthly payment of $3200 on a 4000-square-foot house in Hickory Flat. Or that the Fox TV News fans will maintain their enthusiasm for a war of attrition lacking in cineplex quality battles, while their property taxes are being jacked out of sight to cover the rising cost of maintaining senior parking privileges in the centralized school districts.

The public indeed may be losing its appetite for the Iraq project, but not for Nascar racing, fried chicken buckets, car trips to Six Flags, and round-the-clock air conditioning. What shock of recognition will flash across the TV screens when the connection is finally made that keeping all these things going is why we're in Iraq? War is the answer. Sooner or later even the folks making those jitney trips to East Hampton are going to get it.

Oil's remorseless up-ratcheting past $60 is as much a symptom of a weak dollar as a strained global energy allocation system, and the dollar is weakening because the way of life it represents is becoming more and more unreal. The harsh truth is that we've reached the limit of our ability to expand our suburban sprawl economy and there is no alternative US economy in the background ready to take its place. The world can't fail to notice this weakness. The inability to generate even fake wealth, in the form of ever more WalMarts, will take its toll on the consensus that the American Dream has enduring value.

The stock market contraction ought to reflect this reality - apart from desperate attempts by US government proxies to levitate share prices - and it is hard to imagine a rally in the face of $60 oil. I'm inclined to predict a gruesome journey down for the Dow Jones into the 4000 range by the end of the year. Until now the dollars created by the Federal Reserve's supernaturally loose credit policy have sought shelter in the "hard assets" of houses. A meltdown of the stock markets will translate into vanishing leverage in all other areas of finance, especially in real estate (as well as a swath of destruction through hedge funds, retirement accounts and, eventually, the entire creaking superstructure of the hallucinated mortgage industry). A few Americans are actually going to get the message that this is not a good time to buy an overpriced raised ranch house. A lot of real estate geniuses are going witness their own ruin with wonder and nausea.

The striking aspect in all this is that the US appears to be reaching a breaking point in the absence of any precipitating disaster. Apart from the daily meat-grinder in Iraq, the geopolitical scene is temporarily placid. The potential for disaster is huge, of course. Five pounds of Semtex in a crucial spot could crater the global economy. Sooner or later something will blow. But the US slide is commencing without a big shove. Phase change is a curious condition. Things just slip. Lahar rules.


Turning Point (June 20 2005)

Iraq is not Vietnam, all right, because there is no way the US can pull out now without severe consequences, namely the loss of our access to all the oil in the Middle East - where two-thirds of the world's remaining oil is.

In Vietnam, there was the primal fear that if we cut-and-run all of Indochina would "go communist", whatever that meant. What actually happened after we cut-and-ran in 1975 was Pol Pot and the killing fields of Cambodia, a military dictatorship in Burma, and Vietnam becoming the friendliest tourist country for westerners (including Americans) in all of Asia.

It is actually hard to tell whether the strategy to "democratize" Iraq is a childish pretense or a cynical cover story. There may be some grownups in the White House, Pentagon, and State Department who believe that a functioning, democratically-elected Iraq government would be such a mind-blower for the people of other nations in the region that all the jihadistas of, say, Saudi Arabia, Syria, Yemen, Iran, and Afghanistan would enter a mystical transport and wake up as Jeffersonian democrats.

The Iraq adventure so far seems to indicate that wishing can only accomplish so much. For instance, despite desperate US offensives in Karabilah and Anbar province this weekend, Iraqi hostiles managed to blow up fifty of their fellow Iraqis in Baghdad. The New York Times had an interesting way of capturing the mood: "Life along the street running past the restaurant quickly returned to normal. Older men eighty yards away resumed curbside games of checkers before men had finished sweeping away chunks of flesh." In America these days, a wish is sometimes just another horror movie at the cineplex.

My own theory is that the war is a desperate attempt by a nation desperate over its energy supplies to retain a foothold, and therefore an economic claim, on the region where the oil is. Iraq was supposed to be our police station in a strategically vital bad neighborhood. The salient questions are: (1) assuming we can't stay there forever, how long might we hope to stick around there? And (2) at that point somewhat short of forever, will we lose our ability to even buy Middle East oil?

The conventional belief is that oil is fungible, meaning that once it enters the universal market pool, it finds its own way to customers, determined by who will pay the most for delivery. This idea was based on the assumption that there would always be a swing producer - some entity that could always open up the valves and goose up the world supply, keeping global prices within a reasonable range. The global production peak - Peak Oil in shorthand - seems to have obviated that mechanism. It's especially problematic that even Saudi Arabia and the Middle East generally appear to have peaked (see Twilight in the Desert by Matthew Simmons). From now on, access to oil may be determined by other things.

It was Amercia's hope that by turning Iraqis and other Middle Eastern people into democrats, they would magically become much friendlier and that our military presence would be happily tolerated - and that eventually all the Middle East would become so democratic, friendly, and stable that our presence there would be regarded as a Godsend. Whoops, wrong God. For starters.

The world may no longer have a swing producer of oil, but this period can probably be viewed as a swing period of history. By that I mean a period when we hoped that there was a quick and easy way to keep the oil flowing westward and found out that it wasn't so. The time is now coming when the American public won't tolerate a dozen US casualties a week, nevermind fifty Iraqis. But Americans won't tolerate $5 a gallon gasoline, either. We'll now see how the public will reconcile these intolerances.

We enter this week with oil nearing $60 a barrel. Global finance, hedging, interest rates, and the continued zest of America's last remaining industry, real estate, will all hinge on the price of oil and on America's prospects for getting it at any price. President Bush last week shifted the responsibility for an energy policy to congress, because the ideas coming out of the White House have been so transparently lame (the hydrogen economy).

My guess is that we are about to see the first act of the Hooverization of George W Bush.



California-the-tragic (June 12 2005)

I just paid $3.25 for a twelve-ounce diet coke in the Los Angeles airport, known by the affectionate name LAX by the locals (sounds so cutting age, like rap stars who give themselves technoid names such as G-Unit). The truth is, LAX is just the airport code on the baggage label that they slap on your suitcase before it vanishes forever into the black hole of lost things. Evidently there was an earthquake here today, but the vibe of the city (if you can call this toxic hyper-mega-burb that) is so catastrophic generally that I didn't even notice.

I've been on a long book publicity road trip around California, with a side trip to Seattle on Thursday, and it's hard not to feel hopeless about this country after being here. It probably doesn't help that my 10:30 red-eye flight has been delayed ("aircraft availability", the sign says) and I don't know whether I will make my morning connection in Washington for the final flight to upstate New York. My experience with United Airlines is that they (that is, the remaining skeleton crew) are a gang of lying fucks who will make up any excuse to disguise the fact that their company is a barely-functioning shell. As a matter of fact, there was not a single United employee in the entire P-7 terminal when I got here at 8:00 pm and I had to walk a half mile over to terminal P-8 to find a live gate agent. What you see in this miserable airport is simply the death of the airline industry. The airlines are the giant "canaries in the coal mine" of our imploding economy. They can't make any money, even running fully-loaded flights, with the price of jet fuel (which is little more than kerosene) not even very high yet. But I stray from my point.

Which is that what you see in California is a society with a tragic destiny. I was all over the Bay Area earlier in the week, from San Francisco to Silicon Valley to Berkeley and even down to Santa Cruz, and that was bad enough, But then I got down to Los Angeles on Friday and have been in a state of pathological reflex nausea ever since. Despite their lame attempts to rebuild a few pieces of the 2000-mile-long streetcar system that they gleefully destroyed in the 1950s, life here is all about cars and it will never not be about cars - until the reality of our oil predicament falls on the hapless public like a hammer of God and the people of California die for their fucking cars in their fucking cars and over their fucking cars. I understand that the scene here is not qualitatively different from Dallas, Orlando, Atlanta, Northern Virginia, Miami, New Jersey and other cloacal hot-spots of the world's highest standard of living. But I digress again, sitting, as I am, on the floor of terminal P-7 because I cannot find a single electric outlet anywhere near a chair, and being fifty-six years old, with an artificial hip, this is not the most felicitous scheme for composing one's thoughts.

I was invited to give a talk at Google headquarters down in Mountain View last Tuesday. They sent somebody to fetch me (in a hybrid car, zowee!) from my hotel in San Francisco - as if I had any choice about catching a train down, right? Google HQ was a glass office park pod tucked into an inscrutable tangle of off-ramps, berms, manzanita clumps, and curb-cuts. But inside, it was all tricked out like a kindergarten. They had pool tables, and inflatable yoga balls, and $6000 electronic vibrating massage lounge chairs, and snack stations deployed at twenty-five step intervals, with lucite bins filled with chocolate raisins and granola. The employees dressed like children. There were two motifs: "skateboard rat" and "10th grade nerd". I suppose quite a few of them were millionaires. Many of the work cubicles were literally modular children's playhouses. I gave my spiel about the global oil problem and the unlikelihood that "alternative energy" would even fractionally replace it, and quite a few of the Googlers became incensed.

"Yo, Dude, you're so, like, wrong! We've got, like, technology!"

Yeah, well, they weren't interested in making a distinction between energy and technology (or, more precisely where Google is concerned, a massive web-based advertising scheme - because it is finally clear that all this talk about "connectivity" just leads to more commercial shilling, shucking, jiving, and generally fucking with your headspace in the interstices of whatever purposeful activity one may be struggling to enact on the internet).

The taxi-cab ride to Berkeley (on Google's tab) ran over $160 on the meter. In Berkeley a radical leftist grandmotherly lady interviewed me for a radio show and once that was over she began to tell me about the chemical contrails that Dick Cheney was cross-hatching across the Berkeley skies for the purpose of controlling the masses of earnest, whole-foods-loving, undyed-wool-wearing devotees of diversity and turning them into whorish Stepford sex robots. Everybody knew it was a cover-up, she said.

Seattle was a blurr of traffic, tofu, and dark green things that must have been coniferous trees or seaweed, I wasn't sure. The sleeplessness was catching up with me.

Flying into LA the next day, and traversing its decrepitating central core clean out to Pasadena in the airport van, was like being immersed in an updated Hieronymous Bosch landscape of hell - only substitute SUVs for spavined reptiles and tortured peasants half-stuck inside eggshells. At every turn of the odometer, one wondered: what will become of this entropic socio-economic sink, especially as the supply of its chief nutrient declines. I conclude that it may no longer maintain its stature as the breast-implant capital of the world.

I gave a talk at the closing session of the annual Congress for the New Urbanism in Pasadena on Sunday. My message was one that readers of this blog are familiar with - namely, that we are sleepwalking into desperate circumstances largely determined by our addiction to oil, our supply of which mostly comes from distant lands full of people who hate us, et cetera. I will not bore you by rehearsing this theme further today. Now, the CNU members have generally been among the most forward-looking citizen-activists on the scene for a decade. They certainly recognize the many deficiencies of our drive-in dystopia, apart from the oil issues, and have been working to remedy it. But they don't really believe what I said to them.

The sad truth is that they are addicted to the same economic mechanisms as the sprawl-meisters: the production home-builders (so-called), the great mortgage mills of the conglomerate banks, and the real estate "industry" (also so-called). So they don't want to hear that these "sectors" of our economy are not going to make it. They don't want to hear about the necessity to downscale America anymore than the grifters who develop the WalMart power centers want to hear about it.

But we are going where circumstances are taking us whether we like it or not. We have to make other arrangements - and I mean really different from the way we live now, not just tweaking the municipal codes and building slightly better housing subdivisions and squeezing chain stores under the condominiums and hiding the parking lots behind the buildings. I hope the New Urbanists come around. They have a whole lot of very useful knowledge that will allow us to make our derelict towns habitable while we re-assign the remaining countryside for growing the food that we need locally.

Ah, I admit that I am in foul and turbulent spirits. I have been into the land of the American Moloch among its Moloch-worshippers and I am brainsick from it. I promise to cool my jets and come back next week with something a little less hysterical. By the way, my plane finally got out of LAX at 1:30 am Pacific time, three hours and ten minutes late. I missed my connection, so I am finishing this fugue in Dulles Airport, Washington.



Still Clueless (June 6 2005)

Cluelessness over the the world energy / economic predicament fogs the public discussion more than ever as we approach summer. The New York Times ran a big story in the Sunday news section about India's soaring energy needs and its future plans ("Hunger For Energy Transforms How India Operates"). India is the world's fifth leading energy user. Dig this: they import seventy percent of their oil. India's government predicts that the country will have to import 85 percent of its oil two decades from now.

So what's India's plan? According to Energy Minister Mani Shankar Aiyar, the solution is "to persuade China to cooperate rather than compete". Okay, and your bargaining chip would be ...? Also consider this: The US, Japan, Europe and China will all have to import more than three quarters of their oil supplies. Does this suggest that the world is going to remain an orderly place?

Another plan to keep the lights on in Mumbai (where power outages are routine) is a 1600-mile natural gas pipeline from Iran, through Pakistan, to India. Has anyone noticed (a) that India and Pakistan have been deadly enemies for over half a century, frequently threatening to blow each other up with nuclear missiles, (b) that Pakistan is the world's largest unstable country, and that its rugged terrain is home to many of the world's most rabid and violent Jihadista groups, and (c) that such a proposed pipeline across Pakistan would be utterly indefensible?

The Times story about all this is so devoid of critical analysis that it appears to have been written by an eleven-year-old child.

The Times's star columnist Thomas Friedman is making hay this season with his new book, The World is Flat, about the global economy. His book asserts that current trends will continue indefinitely - China will continue to manufacture ever more of America's household products, Americans will continue to enjoy cash-out home equity loans to buy plastic patio chairs made in China, WalMart will keep running its warehouse-on-wheels at a thumping great profit, and all impediments to global trade will be vanquished by telemarketing, computer technology, and confident corporate can-do spirits. I am tempted to ask how Friedman manages to type on a laptop with his head so far up his ass, but this blog is dedicated, above all, to a high-minded brand of politeness so we'll just say that he is not paying attention to a gathering global energy shitstorm that is going to change absolutely everything - including global economic relations which pundits foolishly maintain to be permanent conditions of life.

Here in the States, the price of a barrel of oil is back over $55 and we are only one week into the summer vacation driving season. President Bush is running a scam on the public by pretending to push Congress to act on an energy bill that offers nothing to realistically address the nation's oil addiction and, especially, its car dependency. He doesn't dare, I suppose, because he must know that the American economy is about little more than car dependency. But just watch: as the price for a barrel of oil heads north past $60, Bush's abject leadership failure will become self-evident and the public mood will appear to shift overnight. The oval office will become a very lonely place indeed by this coming fall, and its occupant will have three long and terrible years left to suffer there.



Pipeline-istan (May 30 2005)

It's a measure of our country's desperation that many hopes among US government officials are pinned to the just-completed 1000-mile oil pipeline between Baku on the Caspian Sea and the Turkish port of Ceyhan on the Mediterranean. The idea is to get oil from Kazakhstan on the far eastern side of the Caspian sea through several other former Soviet states, bypassing a shorter, older route through the Black Sea, and creating an alternative to the ongoing horror show of the Persian Gulf.

The main problem is the idea that the American economy, and the easy-motoring lifestyle that holds it hostage, will now depend on a 42-inch wide oil pipe running through nations fraught with Muslim-Christian conflict on top of post-Soviet gangster politics. The good news is that the $4 billion pipe is buried underground so it will not be vulnerable to the small arms so abundant in that part of the world: shoulder-launched missiles, rocket propelled grenades, or .50 caliber bullets. The bad news is that it is only a few feet underground and can still be blown up by five pounds of Semtech strapped to a donkey. Also, the pipeline traverses some of the most rugged terrain in Asia Minor and presents many opportunities for mischief.

Another problem: Kazakhstan is right next door to China. China needs foreign oil as desperately as the US does. Nothing prevents China from commandeering Kazakhstan's oil, by means ranging from legal contracts to Chinese soldiers on-the-ground. That logically raises the question as to whether America would entertain a land war with China over landlocked Kazakhstan, 12,000 miles away from here. What would you say our prospects would be in such a venture? The Russians might have some interests there, too, not necessarily identical to ours. World War Three anyone?

Finally, the wish back in the 1990s that Central Asian oil would bail the west out of dependence on the Persian Gulf nations has faded with exploration which now indicates the region has far less oil than the 300-billion barrels originally hoped for (more like sixteen to forty billion now), and that it mostly consists of low quality "sour" crude, heavy on sulfur and more expensive to refine.

But such is the nature of strategic thinking in Washington these days that it all comes down to a 42 two inch pipeline for us now. You have to wonder, for instance, why we couldn't take that $4 billion and refurbish at least part of the US passenger railroad system - as compared to the roughly $290 billion slated for this year's federal highway construction and maintenance bill.

Get ready for the interesting half of the year 2005. The summer vacation motoring season is officially underway with the Memorial Day weekend. Oil prices are back up near $52 a barrel after falling to $46 for a few weeks in May. Americans are not going to drive fewer miles this year. Just look at how we've arranged things on the landscape. Most have to drive all over the place whether they like it or not. By the fall, motorists (that is, American citizens - aka "consumers") are going to be very disappointed with the way things are going, and they are going to start blaming the people responsible for our strategic thinking.



Paranoia Runs Deep (May 23 2005)

"Paranoia runs deep; into your life it will creep ..."

So went the lyrics to the old Buffalo Springfield song from the tumultuous Vietnam War years and now, as Yogi Berra also said around the same time, "it's like deja vu all over again".

I like to claim that I am allergic to conspiracy theories and the paranoia that attends them. But these days I'm not so sure anymore. The noise in the system is getting pretty thick, and the Internet is the perfect system for paranoia because any website can appear to be dignified and therefore to speak with some kind of authority. You have to sort out the reality from the noise the best that you can on your own. (So maybe it's not such a bad thing that this blog is so amateurish-looking, as many readers complain.)

The latest paranoid thread out there is that the US Military is waiting to commit a June assault on Iran's nuclear facilities, and that the Bush administration has been manipulating the stock markets up and the oil markets down in an attempt to to lull the public deeper into its coma of cluelessness by making the surface of American life seem placid.

I really don't know what the government is capable of doing to tweak the markets. It certainly has access to a lot of nominal "money", and I suppose that it is not to difficult to put that money into "play", by funneling it this way and that way through large institutions and agencies. The current crisis of capital derives from the fact that the American economy produces fewer and fewer things of enduring value - and more and more fluff in the form of Star Wars movies - so any financial paper or instrument that pretends to represent the nation's longer-term prospects is in danger of not being taken seriously. The wealth accumulated in the US in the second half of the last century is actually shrinking now, since our industrial base is withering away, and whatever investment we are capable of making has been increasingly directed into the "hard assets" of houses. The catch is that the "investment" in houses is almost all credit - mortgages, promises to pay most of the money later. The catch of the catch is that the cost of obtaining credit (interest rates) remains supernaturally low and the standards for creditworthiness have ceased to exist. The catch of the catch of the catch is that a lot of the mortgages are adjustable, meaning the cost of borrowing doesn't necessarily stay supernaturally low. It can float with rising interest rates.

Finance professionals know that these conditions are perverse and perilous. That's why they call it a "housing bubble". The moiling "consumer" masses only know that the dollar-value of their houses goes up ten percent or more every year, while stock and bond portfolios go sideways. So they ignore any supposed peril and keep flipping the houses. Finance professionals know that sooner or later grownups in other countries who buy our financial paper will decide that our long-term prospects are a joke, and that we will have to raise the interest rates a lot to keep them buying. When that happens, the tears begin to flow from the mortgage-holders.

Beneath all this runs the issue of our most critical resource, oil. Without it, America just stops running, and if oil gets much more expensive, major parts of our system start to break down - the easy motoring commutes, the oil-based farming, the big box retail, commercial aviation, et cetera. If oil makes a move above the $60 dollar range, all bets are off for the equity markets, the housing bubble, and the struggling "consumer" masses.

Now, it may be that the oil futures markets were simply overbought in April and the price had to go down while inventories were absorbed. The gross US inventory of oil awaiting the refineries stood at around 330 million barrels last week. Seems like a whopping great amount. We use twenty million barrels a day, so you can see that the inventory represents about 16.5 days of oil. Whoop-de-doo. But having the market price of a barrel of oil dip well below $50 was certainly a great psychological boost for the people who run America. It made President Bush seem like he can command the great forces of nature. And I suppose the oil price downturn also bestirred the equity market players to believe, if only momentarily, that there was some productive juice left in the old economy.

We now face the Memorial Day weekend, traditionally the start of the summer motoring season, when upward pressure on oil prices tends to resume. Even if the tanks are full now, it pays to remind ourselves that nearly three-quarters of that gasoline comes from other lands, including lands full of people who don't want us to be happy. One of these, arguably, is Iran - though many in the hairsplitting game would say it's only the leaders who hate us, not the youthful masses of the population, who don't remember the Shah and all that. Some months ago, our leaders said they would not tolerate a nuclear Iran. In reply, Iran told the US to, well, to go piss up a rope, so to speak. All has been quiet since that exchange. They've made it pretty plain what they aim to do. Who knows what we aim to do? But paranoia runs deep.



Hand In Hand (May 16 2005)

I was in Tallahassee, Florida, last week talking to a large room full of planning officials. My message was pretty straightforward: every new housing subdivision, every new strip mall, every parking lagoon and big box chain-store pod that you issue approvals for from this point on will lead your country deeper into tragedy.

The response was apathetic, as though I were giving a class in Chinese algebra.

Florida is one of the multiple epicenters of a hypertrophic suburban growth machine that has taken the place of the US economy. Reforming it is unimaginable because without the business generated by a cancer-like replication of car infrastructure, the economy would consist of little besides hair cutting, fried chicken, and open heart surgery. In places like Florida (and California, and northern Virginia, and Las Vegas, and Dallas), all citizens are complicit in the drive toward tragedy because all want business-as-usual to continue. The idea that any set of circumstances might put a stop to it is laughable to them. What can you do for such a people determined to commit civilizational suicide?

Meanwhile, a glance at Sunday's New York Times Magazine shows what the supposedly thinking class of America is preoccupied with these days: rescuing architectural Modernism, that twentieth century system of asthetic pretensions that affected to celebrate mankind's triumph over nature by way of technology. Those boys are in for a surprise when they discover that nature gave the human race technology in order that we might choose to shoot ourselves in the head when the time came. This is what comes of humans bethinking themselves smarter than nature. Apart from it. Superior to it.

The tragic futility of the suburban growth racket and the towering hubris of Modernism go hand-in-hand. Both rest on ideologies that drive relentlessy toward death. Both depend on a condition of widespread and extreme narcissism among individual members of society to continue their operations. Both represent a kind of wickedness that does not require religious transliteration to understand. Both will be defeated by reality.



The Rapture (May 9 2005)

When exactly the American public entered the Rapture is a little hard to say - maybe as long ago as the Reagan years - but it is not the same Rapture as the Born Agains are gleefully awaiting - the absurd cosmic vacuuming up to heaven that leaves behind all the rest of us sinners. No, the Rapture I speak of is the stupendous complacency of a people convinced that the future is going to be just like the past.

Everywhere I look I see things that are not going to work in the years ahead, and see people making plans for conditions that will no longer exist. State DOT officials in Texas are planning to build a new statewide super-mega highway network just as the global oil peak forecloses a future of easy motoring. Where I live, at the rural edge of New York's Capital District, suburban housing pods are springing up in every cow pasture in complete faith that supernaturally cheap mortgages and long commutes will continue to be the norm. Municipalities everywhere are investing in multi-million dollar parking structures in the belief that we will be using cars in 2019 exactly the way we do now. Even the enviros are enraptured. I get letters every day from bio-diesel fans who plan to run the interstate highway system and Disney World on oil derived from algae farms.

The collective consciousness is amazingly resistant to the fact that things change. Over in Syracuse, New York, a town sinking into the economic sclerosis of a former soviet-style backwater, the locals have approved perhaps the most idiotic project ever conceived by a free and sovereign people - a hyper-super-giant-mega-mall to be called DestNY USA (sic) that would include 400 stores, 4,000 hotel rooms, a saltwater aquarium, a 65-acre park under a Biosphere-like dome, and a food court based around a miniature Erie Canal {as reported in Sunday's New York Times Metro Section}. The idea is that people will flock to Syracuse by car from places with equally sclerotic economies (Worcester, Massachusetts or Scranton, Pennsylvania) in order to go on shopping sprees for new sneakers and cargo pants, which for some reason may be in short supply where they live.

The near-imbecile governor of New York, George Pataki, showed up to grandstand at the "groundbreaking" for this dumb-ass boondoggle (which has garnered tons of tax credits and other windfalls), though not a darn thing has been built since that symbolic shovelful of dirt was turned over. The developer behind DestiNY USA, one Robert Congel, was the CEO of a predatory shopping mall company, Pyramid Inc, which raped the local retail economy of many an upstate city since the 1970s. For all of its grandiosity, DestiNY USA is still minor league stuff compared to the plans afoot for Las Vegas, where the Rapture is in its most florid and terminal stage, and aggravated by yet another collective mental disorder: the belief that it is possible to get something for nothing.

I'd go as far to say that a public as complacent and clueless as America's is these days deserves to be played for fools. It's not pretty, but life is tragic. History doesn't care if we sleepwalk into a clusterfuck. Plenty of other societies have before us. The real sin in the real world is the failure to pay attention to the signals that your environment sends you. The signals aimed at us now tell us the following: the oil age is entering an unstable permanent decline; suburbia and all its usufructs is finished; the blue-light special shopping economy is about to end; easy motoring will shortly be a thing of the past; the middle class will be replaced by a new former middle class; and all bets are off as to how violently American politics will shudder when the fog finally lifts.



2041 (May 2 2005)

In his press conference last week, President Bush was fixated on the year 2041 as the point that social security will come off the rails financially if not reformed soon. He emphasized the year 2041 several times.

I wonder if the president has done the math on world oil supplies. A year ago (2004) just about any authority would tell you that, based on the current rate of use, the world oil supply would last another 37 years. Which would bring us to 2041. What a coincidence. Of the two issues, social security and oil, I have to think that running out of oil would be the more compelling, since social security will not exist unless there is an industrial society to support it. Inasmuch as industrial society runs on oil, and no combination of alternative fuels can take its place, a reasonable person would have to conclude that we face a hell of a problem.

Energy is what the president pretended to address in the first (and much briefer) part of his press conference - and he was asked hardly any questions about it during the Q and A. The president's view is that "new technology" supplied by human ingenuity will eventually solve America's problem with oil. This reveals a misunderstanding very common among those in the US public who think about these things at all, namely, that technology is thought to be synonymous with energy, that they are essentially the same thing.

The fact that energy and technology are not the same thing is crucial to understanding our predicament. There are really only five energy sources available to us: non-renewable oil, natural gas, coal, uranium, and renewable solar (which includes wind, hydro, photovoltaic, and bio-mass, all dependent on sunlight acting on the earth). The hope is that technology will somehow allow us to capture an equivalent amount of energy from renewables that we now get from non-renewables. This is the central fallacy of techno-hubris. And this popular delusion is one of the unfortunate unintended consequences of America's successful landing on the moon in 1969 - the idea that we can do anything if only we wish hard enough. Talk about diminishing returns as expressed in culture!

Of course there's a catch with the theoretical 37-year supply of world oil. The catch is that we don't have to run out of oil, or even close, to have trouble with a depleting supply. All that's necessary to destabilize the major industrial systems we depend on is a fractional yearly decline in production, say two or three percent, because that will mark the end of conventional industrial "growth" that global finance requires to continue operating. It also matters that the US has been depleting its oil at about that rate for thirty-five years and that we make up for our declining oil supply by importing two-thirds of the oil we use from other nations, many of them unfriendly.

President Bush has therefore wasted the first two months of his second term following a mistaken set of priorities. The system that is most in trouble is the oil-addicted American way of life and all its familiar accessories: the single family home in the suburbs, the multiple millions of cars and trucks running at any time, and the food grown and processed on fossil fuel "steroids". If we don't reform that system than nobody in American society will have security of any kind much sooner than 2041.



A Bitch-Slap Upside the Head (April 25 2005)

I was at the University of Wisconsin last week, doing Q and A after a lecture, when somebody asked me what it would take for the American public to start paying attention to the grave energy issues coming down at us. I answered, speaking figuratively, a bitch-slap upside the head. At once off to the side of the big room, a young woman thrust up her hand. I called on her and she said that she was offended by my remark. I was then duly upbraided for my choice of language and my attitude toward women.

This is not the first time I have encountered a reaction like this. A similar thing happened to me at Princeton last month. I remarked that Modernism had succeeded in removing all feminine qualities from architecture, in particular ornament and curves, and a wrathful female student hastened to chastise me for expressing the idea - to which, it seemed to me, any genuine feminist ought to be sympathetic.

After much pondering and prayer, I conclude that the faculties of the America's great universities have forgotten what free speech means, namely that even if expressions make us feel uncomfortable we are obliged to tolerate them so as to assure our freedom to express ideas that might make somebody else uncomfortable.

What's obvious is that these students have been carefully trained by their teachers to behave this way, conditioned to rise up on cue in censorious indignation to smack down ideas that "offend" them. Who are their teachers? A lot of the tenured ones are fellow members of my own Woodstock Generation (and many of them are women). It's awfully ironic that an intellectual trend that started with the Berkeley "Free Speech" movement in 1965 has now mutated into a widespread impulse to censor free speech on the grounds that it "offends".

This was the case earlier this year when the president of Harvard, Lawrence Summers, remarked at a conference that in light of the overwhelming representation of males on the science faculty perhaps there was something innate in the difference between men and women to account for it. Summers was pilloried for his remarks. The faculty went so far as to organize a formal no confidence vote against him. He has refused to step down, though he has issued many obsequious apologies in the aftermath.

What is most amazing about the Harvard incident is that it formally established the faculty's position as being officially against free inquiry and free expression - and, of course, that it happened at the supposedly highest level of academia.

I would go so far to say now that this has all happened precisely because of differences between men and women and the fact that women have come to dominate some college faculties, especially the so-called humanities (where expression is supposedly taught). They've implanted the idea that somebody's (anybody's) personal feelings are more important than the substance of any expression, and that somebody's (anybody's) hurt feelings are grounds for shutting down the expression, and the discussion that goes with it. The implicit narcissism is also fantastic.

I regard this behavior on the campuses as pernicious fucking nonsense. It is just another thing (along with the widespread belief that it is possible to get something for nothing) that is turning America into a fourth-rate culture, a nation of cravens and cretins. And it will lead us right into the grip of the law of perverse outcomes, which states that people get what they deserve, not what they expect.



That 1914 Feel (April 18 2005)

The stock markets and the oil futures markets sank in tandem last week as the global economy responded to increasing strain by wobbling. Oil dipped below $50 a barrel. Don't expect it to linger there long, as the summer driving season approaches. (Memorial Day weekend is the traditional start.)

Americans will travel compulsively even in a darkening economy. They may not go to Europe right now, with coffee at five bucks a cup there, but they will keep driving around the US because the suburban wastelands where most Americans live are so unendurably depressing that their denizens will pay almost any price for gas to get away for a while - if only to hyper-artificial destinations like Las Vegas and Disney World. In any case, virtually all American cities (or metroplexes, since the city part is now the least of them), are so designed that stupendous rates of daily motoring are unavoidable.

Being allergic to most conspiracy theory, I am not sure that a Plunge Protection Team actually exists. (That is, a gang of institutional investors whom government leaders can call upon to prop up faltering stock markets.) If there is such a cabal, then I would be further skeptical as to the extent of their power to act. This week will test their supposed powers against a super-tide of nervous lumpen 401-K holders who have begun to notice things such as the fact that nobody wants to buy big stupid badly-designed American cars, or that Senator Charles Schumer (D-NY) is hot to impose tariffs on Chinese textiles (that is, every article of clothing found in the GAP, Target, WalMart), or that we suddenly have a much more punative bankruptcy law that will make credit card free-spenders think twice about flirting with insolvency. My own predication is that the stock markets are entering a free-fall.

The excellent young historian Niall Ferguson has an essay in the current issue of Foreign Affairs ("Sinking Globalization") to remind the supposedly thinking class that the global economy is not a permanent insitution but a set of transient conditions that has come and gone before - namely, the period running from about 1870 to 1914, when the First World War put an end to the Industrial Age's first great interval of stability and free trade. That "golden age" beat a path into a gruesome intermezzo of broken political relations, depression, and more war. Globalization did not resume until the 1970s, when two things occurred: (1) the other combatants of World War Two recovered some industrial traction and (2) US oil production peaked and pricing power shifted to OPEC.

Since then, the world has enjoyed another extraordinary era of stability between the major nations. Notice, I don't use the term major powers. Many would argue that US military power is beyond challenge. A minority view states there enough small arms in the world so that any gang of miscreants with $50,000 worth of rocket-propelled grenades, shoulder-launched missiles, and Semtech plastic explosive can make the US Army do a hurt dance. The long term trend is for America to exhaust itself engaging with these fire-ants, and to withdraw from the ant-hills back into the safety of North America.

That process is now underway, and the economic implications are rather dire. The spring of 2005 has that 1914 feel. In Iraq and the rest of the Middle East, the current hiatus has settled nothing. The various tribes and factions are still pissed off at each other and at us. America is still left with its huge oil import addiction and a suburban way-of-life that no amount of "energy conservation" can appease. The tectonic stresses of economic distortion have been building under the surface of the Wal Mart / China partnership. For those of you contemplating a vacation in Las Vegas, don't bet on the status quo.

http://jameshowardkunstler.typepad.com/clusterfuck_nation/

James Howard Kunstler is author of The Long Emergency: Surviving the End of the Oil Age, Climate Change, and Other Converging Catastrophes of the Twenty-first Century (Atlantic Monthly Press (2005) and several other books.


Bill Totten http://www.ashisuto.co.jp/english/

What's Left of the Union?

by William Pfaff

New York Review of Books - Volume 52, Number 12 (July 14 2005)


1.

The French and Dutch referendum votes against the European constitutional treaty caused many Europeans to be alarmed for European unity itself. This was called the biggest reversal for Europe in fifty years, a revolt against economic reform putting the euro in jeopardy, a "lurch to the left", a repudiation of Europe's modernizing elites, the beginning of the end for the European Union. "We who lead Europe have lost the power to make Europeans proud of themselves", said Jean-Claude Juncker, Luxembourg's prime minister and current holder of the European presidency.

The rejection is something much simpler. It is a crisis provoked by the expansion of the European Union. It was foreseeable, and was sooner or later inevitable. The French and the Dutch have done the European Union a service by bringing it on now. A Europe of twenty-five members (not to speak of a potential thirty-five, or more) is too big to function as the Europe of Six, Twelve, and even Fifteen has been able to function. It represents a radical break from the EU as it has existed.

The constitutional treaty was the product of months of conscientious reconciliation of the views of the individual national members, under the presidency of Valery Giscard d'Estaing, who wrote the final version with the synthesizing panache taught only at the Ecole Nationale d'Administration. (The Constitution "is easy to read", he told the French; a "tres joli" text. [1] ) In addition to combining all the previous EU treaties into a single three-hundred-page document, the constitution confers a number of additional powers on the union. It establishes a single EU foreign minister and a full-time president of the European Council, which consists of heads of state and government. It eliminates single-country vetoes on basic legislation (though not on big foreign policy decisions); and it increases the powers of the European Parliament. Although Spain approved it in a referendum earlier this year, France and the Netherlands rejected it with passion as soon as the public could have a go at it in their own referendums. [2]

[1] The French listened to him; they knew what they were voting on. In the final weeks before the referendum, books about the constitution were the three top French best sellers. The text was distributed by the government to everyone on the voting lists. An impassioned debate that split families and ended friendships had an intensity not experienced since a Socialist-Communist coalition successfully bid for power in France in 1981.

[2] Nine countries chose to ratify the treaty by parliamentary action: Austria, Germany, Italy, Greece, Hungary, Latvia, Lithuania, Slovakia, and Slovenia.


The rejection surely demonstrated the current gap of comprehension between European political elites and the European public, but was mainly evidence of the consistently underestimated forces of national identity and ambition in each of the twenty-five nations. The French were enthusiastically seconded by another highly nationalistic and individualistic Euro-pean society, the Netherlands - also one of the founding states of the European Union.

Not only the French and the Dutch (and obviously the British, who have now postponed a referendum that almost certainly would have rejected the constitutional treaty) are opposed to the constitution - or to be more exact, to the form of European integration, and the intention of further EU expansion, that the constitution embodied.

Sixty-five percent of the public in Sweden has demanded a referendum (instead of ratification by parliament) - a percentage that doubtless forecasts how the vote would go. The outcome of the Luxembourg referendum set for July 10 is expected to be no. Before the French and Dutch voted, polls in Denmark suggested a "yes" majority in the referendum called for September; but the prime minister, the Liberal Anders Fogh Rasmussen, has already said that unless Denmark has a guarantee that the document to be voted on will not later be renegotiated, a referendum is pointless.

The German Bundestag has also already ratified the constitution by a very large majority, but there is much reticence in Germany about where Europe seems headed. A writer in Die Zeit said recently that "the deep source of the malaise is not the constitution but Europe; one has the impression of having lost control over it".

A German Christian Democrat deputy who was a member of the convention that wrote the constitution said recently:

"Until the start of the 1990s, we believed German and European interests were synonymous, identical. Today, opposition to that idea is visible, slowly developing over more then ten years. It began with hostility to the euro, which still exists ..."

As this is written, the European Council meeting of presidents and prime ministers on June 16 is considering the next step, but while some governments cling to the idea of renegotiating the constitution, or think everyone should still have a chance to vote, it seems obvious that the constitutional project is dead, and so is Europe's expansion beyond the current twenty-five members - plus the two who have been promised membership, Bulgaria and Romania. Turkey now appears to be out.

According to the EU agreement the ratification process can't go on indefinitely. If, after two years, four fifths of the EU states have ratified the constitution but the rest have experienced "difficulties", the European Council "will be seized" of the matter. With two important referendum defeats already, preparations for a British referendum suspended, and the prospect of referendum defeats in Luxembourg, the Czech Republic, and even Poland, the European Council seems unlikely to be troubled by the ratification issue two years hence. The European Union in that case will go on being governed by the ill-considered Nice Treaty of 2003, undoubtedly amended to remove some of its more unsatisfactory provisions, including its allocation of votes in the European Council, which was unfavorable to Germany and notably favorable to Spain and Poland. It will then be necessary for the EU governments to reconsider the future of Europe.

The referendum defeats and their implications have demonstrated a reality that the European political leadership has failed to acknowledge or has not wished to recognize. Expansion of the EU to the former Warsaw Pact nations was undertaken for moral as well as political reasons that, once the cold war ended, were all but impossible to ignore. But quantitative change can become qualitative change. The EU was being changed by expansion in ways that obstructed the integration and common action that were part of the EU's original intention and previous development.

Large parts of the EU populations in the "old" countries of the union - France, Germany, and the Netherlands among them - are uncomfortable with expansion to twenty-five countries. They are apprehensive about bringing into the EU Romania and Bulgaria, not to speak of the remaining and still unreconciled former Yugoslav states of Croatia, Serbia, Montenegro, and (whatever its eventual form) Kosovo, and very doubtful indeed about Ukraine and Georgia.

All these countries have traditions, cultures, and histories more or less distant from those at the core of Western Europe, where the EU started. There is even greater reluctance to extend the EU to non-European Muslim countries in Asia Minor and the southern Mediterranean. Turkey, Morocco, Jordan, a new Iraq, and eventually Israel had all been thought by some to be logical future members. Including them would, it was hoped, soften the "clash" of Islamic and Western civilizations.

Forceful arguments were made for admitting all these countries. A "new Yalta" agreement that would cut Bulgaria, Romania, Ukraine, and Georgia out of "Europe" seems scarcely thinkable. The exclusion of these countries - their abandonment and consequent isolation from the European mainstream - could have desperate, even disastrous, consequences for them. The elaborate, sophisticated, and well-financed mechanism by which EU candidate members have until now been impelled to reform their political institutions, standards of justice, and protection of human rights, and develop their economies, has proven a marvelous force for stabilizing and modernizing societies with turbulent histories such as Spain, Portugal, Ireland, and Greece.

Over the last decade the EU has had immense influence on Turkey as Turkish leaders worked toward membership. There is obviously a great need to support political and social reform elsewhere in the Muslim world in order to develop constructive relationships between Islamic society and Europe and the larger West.

But to attempt all this by holding out the promise of EU membership threatens the integrity and survival of the European Union itself. Such is the judgment of the French and Dutch electorates. The EU is not an international aid or development agency; it is not aimed at reforming humanity or reconciling civilizations (or for supporting American foreign policy and global aims, as some Americans would like it to become).

The Dutch and French votes reflect the intuition that the first obligation of any political society, whether national or multinational, is to itself, its own security, integrity, and successful functioning. The European Union has to be a success in order to have a constructive influence on others, and this is what has seemed in jeopardy. As a success it may radiate its influence to neighboring societies through many forms of more or less intimate association, but not through membership, which would compromise its own integrity and capacity for action.

Some see cultural or religious discrimination in such a view. Some certainly see in it the comeback of nationalism, and the conventional political wisdom since World War II has identified nationalism with fascism. Fascism and Nazism both were nationalist historical moments, but nationalism is not fascism or Nazism. The US at this moment is arguably the most nationalistic country on earth.

Nationalism is an expression of the intense need for affirmation of national or communal identity as the anchor of individual identity. It is one of the fundamental forces at work in political societies, giving them meaning. It is also one of the "strong" forces in the physics of international relations, if not the strongest. It overrides short-term deviation or distraction. Although it may accompany high-minded internationalism, it does not readily yield to it; the repressed returns. For this reason nationalism has to be accommodated, not stubbornly resisted.

This is the force that has upset the European project and that resists further EU expansion as well as further concentration of executive power. The constitution asks a larger sacrifice of national sovereignty than the French, Dutch, and others are willing to accept. The Dutch plebiscite was all about identity. "We want to stay Dutch" was one of the slogans used to mobilize votes against the Constitution. The existence of a large and unassimilated immigrant population was a particular factor in the no vote in the Netherlands.

2.

Considerable confusion has been caused by comment in Europe as well as the United States and Britain that conflates the domestic problems and political conflicts of France and the Netherlands with the issues of European expansion and the constitutional treaty. France suffers a "crisis of regime" that results from unemployment of about ten percent, failures by the existing and previous governments to bring about economic and social reform, and personal rivalries over who will be the next president. This is all very interesting to the French political class and public, and to outsiders interested in France, but it is of strictly French concern.

The same is true in the Netherlands, where a weak coalition government deals with the consequences of the breakdown in recent years - for reasons having little or nothing to do with the EU - of the old political structure of Dutch society. Since the beginning of the last century political stability in Holland has rested on a more or less formal division of power and institutional influence among the Protestant and Catholic churches and other major social institutions in the Netherlands.

Today the churches are no longer strong enough to bear the weight of this arrangement. At the same time a large immigration - mainly from Turkey, Morocco, and the former Dutch colony of Suriname, among other countries - changed the complexion of the society, but the immigrants were never asked to assimilate to what is actually an old and unique society that in its own way can be highly intolerant. [3]

[3] The same mistake has been made elsewhere, where, for high-minded reasons, assimilation or cultural accommodation was not demanded of immigrants, thereby ghettoizing them, without meaning to do so. The largest components of Netherlands immigration have been Moroccan, Turkish, Somalian - all Muslim societies - and people from the former Dutch colony of Suriname, where Dutch is the official language and the population a heterogeneous one of Creoles, Indians, Javanese, blacks ("Bush Negroes"), and Amerindians. The assimilation - or nonassimilation - problem chiefly concerns the Muslim groups.


That the Netherlands arrangement has broken down was the conclusion drawn by the Dutch from the murders of the radical politician Pim Fortuyn in 2002 and last year of Theo van Gogh, maker of a film hostile to Muslim treatment of women. These were great shocks to a traditionally stable and liberal society, but again had nothing to do with the EU.

In both the Netherlands and France much opposition to the constitution was misinterpreted: the actual effect of the vote is not the one primarily intended. A great many French voted against Jacques Chirac and his government for being unable to solve the problems of high unemployment and low growth; but few of those voting in France or the Netherlands considered themselves voting against European unity as it now exists. They were voting against a different Europe, one that the constitution might have created.

In the Netherlands, people were not only voting against more immigration, they were also voting in protest against the loss they suffered from official undervaluation of the guilder when the Netherlands joined the euro. They were objecting to the indifference of EU officials and the larger countries to the Netherlands' proposals concerning the constitution. They were voting for such irresistibly persuasive intangibles as "remaining Dutch". They implicitly were voting against admitting Turkey and Ukraine to the EU, and against the original EU members' loss of influence to new members. They voted against having Russia on Europe's frontiers, as is now the case, and Europe's on Iraq's, as would be the case were Turkey admitted. But they were not renouncing the EU.

The French voted against the abstraction called "liberalism", understood in Europe as globalizing American market capitalism set on destroying the European model of social welfare and government. They voted against the threat of Polish plumbers rushing to fix French sinks at prices ruinous to French plumbers, supposedly implied in Dutch former European commissioner Frits Bolkestein's proposition for liberalizing competition in services across the EU. (Press inquiries in Poland subsequently produced little evidence of plumbers anxious to move to France.) They also voted against the threat that the constitution would allow NATO to control European defense.

But aside from larger European issues, the French were voting against the stagnation and sterility of French politics. Jacques Chirac launched his career as a presidential candidate twenty-nine years ago, against then President Valery Giscard d'Estaing, the man who drafted the European Constitution. Giscard first became a major political figure while Charles de Gaulle was still France's president. The French would like change. They want someone to break their political stalemate, in which the same familiar faces shift from one position to another. President Chirac recently appointed Dominique de Villepin as prime minister, at least a relatively fresh face in French domestic politics, but that is not likely to be enough.

In France one can observe a very sophisticated level of political debate and passion but it does not always provide a model of political lucidity. The public demands reforms, and when it gets them often goes into the streets to block their application, as in a recent case of educational reforms. The French are a notoriously contentious people - rationalized as a heritage of revolutionary tradition - which is an important factor in both the demand for reform and the reluctance to have it applied.

In 1991 the French public, urged to do so by President Francois Mitterrand, approved the Maastricht Treaty confirming the expansion of the EU to twelve nations and proposing steps toward a common currency. Comparison of the May 29 exit polls in France with those of the referendum on the Maastricht Treaty shows no strengthening of extremist parties. Nor do the polls show new class, ideological, or regional divisions, or a rural-urban divide, or even one between the employed and unemployed. Retired people mostly voted yes both times, as did the professional and upper middle classes.

The decisive difference was a big shift in the vote of the "intermediate" trades and professions that make up the lower middle class. These include schoolteachers, nurses and hospital technicians, accountants, department heads in shops, and salesmen, among many others. The "no" vote of this group increased by seventeen points between the Maastricht referendum and 2005, producing a 53 percent majority.

In 1992 this group was the great beneficiary of the prosperity of France's so-called glorious thirty postwar years. Its members were making more money than ever before, buying new houses in better suburbs, and had high expectations about their own future and particularly that of their children. That optimism now has disappeared, and people fear falling back. They have lost buying power and are afraid for their children. They are working harder (the thirty-five-hour work-week notwithstanding) but losing ground. These above all are the people who see "France in decline", while their own situation seems ignored by management and unions alike; they are overlooked by the press, and treated with indifference by governing elites in Paris and Brussels. [4]

[4] Inquiry carried out for Le Figaro by Ipsos; see analysis by Vianney Aubert, Le Figaro (June 6 2005).


Undoubtedly there is an element of nihilism in French voter conduct today, provoked by political frustration, but again this has little or nothing directly to do with the EU. An economist and historian, Nicolas Baverez, wrote in Le Monde on June 4 that the constitutional referendum simply provided "the death certificate" for "Gaullist France, corrupted by Francois Mitterrand, and ruined by Jacques Chirac". This is a convincing verdict.

Yet there are solutions. Sweden, Denmark, and other countries such as Switzerland manage to combine high standards for their social policies with low unemployment. Some of the solutions to France's problems are readily apparent, such as the necessity to remove fiscal and administrative barriers to firing and hiring, and to the creation of new enterprises. But these require the political leaders to tell voters things they don't want to hear (as Gerhard Schroder has begun to do in Germany).

Baverez also speaks of the problem of Europe's "organized deflation, which has transformed 'euroland' into a desert of unemployment and innovation", the result of Germany's original insistence that the European Central Bank be given as its sole task the prevention of inflation. This automatically canceled the possibility of Keynesian policies (even the perverted Keynesianism of Bush administration deficit finance, which gives George Bush's and Alan Greenspan's America its much-envied growth and high employment). As Robert A Levine, former deputy director of the Congressional Budget Office, wrote recently, "The rigid monetary and fiscal constraints imposed by Maastricht are at least as responsible for economic malaise as structural sclerosis is". [5] French voters remember that France's postwar growth, from he early 1950s to the oil shocks of the early 1970s, took place under a dirigist government's successful industrial policy, by which the government both supported and protected industries that showed a strong capacity for growth. At that time monetarism was but a cloud on the policy horizon, not the fading orthodoxy it is now.

[5] "[A eurozone return to prosperity] will require structural change; structural change will require voter approval; voter approval will require prosperity. The circle can be broken only by returning to the pragmatic use of monetary and budgetary stimulus as a necessary if 'irresponsible' first step to growth". Op-Ed article in The International Herald Tribune (June 8 2005).


3.

The European Union is an amazing accomplishment. The original and early members have made a fifty-year effort to bring about Europe's reconciliation; they did so with generosity, and willingness to pool sovereignty and spend money on one another and on the later members who joined the union. They aimed to create and sustain international peace, and economic and social development. The EU has transformed formerly poor countries in Europe - Greece, Ireland, Spain, and Portugal - and now is repeating this effort to benefit its new Central European, East European, Baltic, and Mediterranean members. It is a great success.

Rejection of the constitution does not damage the existing union. Relevant reforms - such as having a single president and reinforcing diplomatic and security powers - can be recovered from the wreckage. It is entirely possible for the EU countries to work cooperatively within a moderately altered version of the present EU structure of the twenty-five (or twenty-seven).

Former French foreign minister Hubert Vedrine wrote in Le Monde on June 9:

"Europe is geographic as much as political. It has to have limits ... We should return to the Europe of great projects: infrastructure, educational, scientific, industrial, social, cultural, ecological, diplomatic projects. Projects that are precise, with timetables. Offered this, no one will be tempted to vote 'no'. Existing treaties permit it. Give the eurozone a true economic policy. The challenge of the future is to reconcile growth, employment, and ecology. Let the European continent accomplish this synthesis."

What is certainly feasible is a political arrangement in which there are several different levels of integration and nations selectively cooperate with one another when it makes sense to do so. This sometimes is described as discrimination, relegating some members to lower status, a conclusion that does not automatically follow. Such a Europe of diverse competences and ambitions is probably the only practical solution.

The European monetary zone, for example, in which the euro is the only currency, includes only twelve out of twenty-five EU members. The Schengen agreement eliminating immigration and travel barriers involves only fifteen EU countries, but includes non-EU Norway and now Switzer-land. EU peacekeeping initiatives have been carried out in Macedonia, Bosnia, Kosovo, Afghanistan, and the Congo.

In each case, the distinctions between those who take part and those who don't are pragmatic rather than invidious. The European monetary zone, the European security organization, and European diplomacy all have different patterns of cooperation among EU members. Neutral states, non-EU NATO members, and non-NATO EU states accept different commitments and different ways of working together.

Within the existing EU a group of nations practicing "reinforced cooperation" in defense and foreign policy has been emerging, the result of an Anglo-French initiative at Saint-Malo in December 1998, strongly seconded by Germany and Belgium. The EU is preparing 7,500-man crisis groups for peacekeeping and a 60,000-man rapid reaction force that leaves out the EU's neutral members, Austria and Ireland. The intention is to establish a serious European political and security presence in world affairs, a role that most of the group's members, former great powers, had in the past.

Such is the Europe France wants. It is opposed and much derided in Washington and at NATO headquarters. Nicholas Burns, the US undersecretary of state and a former ambassador to NATO, bluntly told a NATO conference in Sweden on May 25, "Let's get it straight. NATO does the big military operations" (or to be more accurate, US-led coalitions drawn from NATO and elsewhere are expected to do them). The EU, he continued, handles peacekeeping operations. "If not", he said, "there will be friction, and you [meaning the Europeans] are not going to be happy".

However, the commitment to making Europe a diplomatic and strategic force in the world was embodied in the constitution and undoubtedly will survive its demise, since it, too, is an affirmation of national or communitarian independence and strength. For this reason it may be doubted that it can be denied in the long run.

The official American position, reiterated several times during and after the French and Dutch votes, is that the United States wants "a strong and united Europe". The dramatic French vote initially produced glee in some neoconservative circles, but the administration now wants good relations even with the "old" Europeans, and has its own priorities for the EU. It seeks European help in Afghanistan and Iraq, and also in dealing with Iran and in supporting whatever Washington eventually does with respect to a Palestine state.

The mainstream American foreign policy establishment has long wanted the European Union to have a close relationship with Washington, and some Americans expect it to eventually become the political counterpart to NATO in America's transatlantic relations. This clearly implies American leadership, and is part of a larger conception of world "democratic" alliance. What Washington does not want is a Europe that aims to be a counterweight to US power or a power center in a multipolar geopolitical structure. Such could be "the road to war", Condoleezza Rice once warned.

Hence a European crisis that temporarily weakens the French position in Europe and strengthens Tony Blair is welcome in Washington, while a Europe that will not be open to Turkey or to new members from the post-Soviet states is unwelcome. What is unacceptable to the US administration is a Europe with political and strategic ambitions of its own. Nonetheless, that seems likely to be the Europe that will survive the doomed adventure of the constitution.

(June 15 2005)

NYR Books Copyright 1963-2005 NYREV, Inc. All rights reserved.

http://www.nybooks.com/articles/18117


Bill Totten http://www.ashisuto.co.jp/english/

Challenges in a World of Oil Scarcity

The Coming Saudi Oil Crisis

by Matthew R Simmons

CounterPunch (June 21 2005)


As oil becomes a scarce resource, its use will have to be rationed in one way or another. There are ways to allocate oil use and direct it to its most valuable applications. But achieving such a rational plan will require a carefully orchestrated, global, country-by-country effort. Left unattended, this process could quickly evolve into genuine chaos. The global economy can function after oil supplies peak, but not in the same manner in which we live today.

Once oil supply peaks, the world will be forced to create ways to substantially conserve our oil and other energy sources. This shift should force a rapid rethinking of the notion that transporting people and products anywhere in the world is an almost incidental cost of doing business. "Transportation" turns out to be the biggest single user of oil, and we need to begin finding ways to minimize everyone's transportation needs and make the use of transportation fuel as efficient as possible. Today, the most wasteful use of transportation fuel is probably traffic congestion. A world beyond Peak Oil will be forced to solve this problem, too. Whether its solution is living closer to one's work or using more mass transportation, both become viable ways to address traffic congestion and use oil more efficiently as prices rise. Simply building additional miles of wider and wider roads no longer works. Even a new fleet of more fuel-efficient vehicles will take too long to implement and may still use too much oil. If we do not alter our transportation systems as a matter of policy and public planning, the inexorable operation of pricing mechanisms will do it for us. At some price for gasoline, traffic congestion will diminish.

There is no question that a world of increasingly scarce oil will foster a growing competition among energy-consuming countries. As the reality of declining oil supply becomes better understood, this country-by-country competition could evolve either into a manageable process (like the economic competition that has existed for decades among the various OECD countries) or an aggressive free-for-all that triggers new wars. If the problem is misunderstood or left unaddressed, war could easily prevail over peaceful competition. Securing adequate oil supplies was, after all, an important element in all the major wars of the twentieth century and in the United States' two most recent interventions in the Middle East. If the magnitude of the problem is fully understood and the risks of a laissez-faire approach are appreciated, all nations should be able to recognize the necessity of working out comprehensive ways to allocate an increasingly scarce supply of oil among the world's many deserving countries.

The competition for oil supplies is not waiting for the day when oil production peaks and begins to decline. Scarcity is not simply a function only of production and supply; it also results from increasing demand. And that is the situation we are facing today. More people in more places want a share of the world's petroleum resources. Rising demand over the past several years has altered the previous market balance and quickly turned oil from a relatively abundant to a far scarcer commodity. The most aggressive new entrants into the international petroleum markets are China and India, the world's two most populous nations with two of the fastest growing economies. They will, within the lifetime of a majority of Americans and Europeans alive today, become the two largest national economies in the world by most measures, although they will not be the wealthiest.

The developing oil needs of China and India are huge, and their leaders seem now to be truly understanding the issue, perhaps far better than the leadership in many already prosperous countries. They are now using every means traditionally employed by Western nations and their oil companies, short of military force, to secure sources of supply. These means include diplomatic relations and foreign aid, direct investment, bilateral agreements, technology assistance and transfer, and the exploitation of frictions in the traditional relationships between Western nations and non-Western oil producers. China has forged agreements with three of the largest Petroleum exporters - Saudi Arabia, Iran, and Venezuela - and with several others. Not surprisingly, several of these exporting countries are currently in disputes with the United States. These countries may not be above using their increased market leverage in ways that will damage US interests.

The growth in China's and India's need for oil has now become very visible. Less visible is the meager oil use by many other countries that now also aspire to be like "us". In a world where oil is limited, it is vital that a truly global International Energy Agency (IEA) begin to embrace the needs of all the world's energy users and not simply view its role as that of the energy watchdog for the prosperous energy consumers.

I happen to think the world can make the transition into what we might call the post-Saudi oil era in some very rational ways that will limit economic disruption. As a perpetual optimist, I believe the world still works beyond Peak Oil. While oil prices in this new world will obviously rise, this rise can be a blessing, not a curse. Far higher oil prices make all other forms of energy more competitive and spur on energy research programs that might discover some real long-term fixes.

Higher oil prices will also trigger a massive influx of money to all oil-exporting nations, even as their reserves and daily outputs shrink. With proper guidance, and based on the grim reality that this great flow of fluids for these oil countries is essentially a "last call" instead of just another boom that will be followed by another bust, oil-producing countries can make the most of the revenues that higher oil prices create.

It is imperative for countries like Saudi Arabia and the Middle East producers in general to wisely invest their pending windfall profits toward creating modern societies that work beyond oil. If such plans are enacted, their unforeseen benefits could turn into a surprising global miracle. The time for using high oil prices for guns, palaces, and Swiss bank accounts is over. This money now needs to be used to create the basis for more abundant life in these countries after Peak Oil.

Do the math to understand how powerful this spending boom could be. OPEC, as a group of countries, now has about 600 million people. By 2025 or 2030, the OPEC population could easily exceed one billion people. If future oil prices were to remain as low for the next twenty years as they have been over the last ten years, it would almost ensure an ever-increasing gap between vast wealth for the ruling elites in these important countries and increasing poverty for the masses. Such a model is unsustainable. Social chaos, increasingly violent terrorism, and political or military revolutions would ultimately become "normal events" throughout all OPEC countries.

If the process is managed in a rational manner, an era of high oil prices can create the necessary revenue to begin building a genuine middle class in most OPEC nations. This process would, in turn, unleash a buying spree for OECD goods and services. The growth in demand for such goods that this new middle-class OPEC society would want might make even the economic
miracle unleashed when the Marshall Plan rebuilt Europe appear modest in comparison. It would certainly overwhelm the economic miracle of the 1980s and 1990s when the Asian tigers finally rose to prominence.

A world that learns to live with a dwindling oil supply will also be forced to control the emissions that energy use creates in an entirely different way than anyone envisioned when worries of global warming first began to surface. A continuation of urban sprawl would become an intolerable trend as the transportation that supports it becomes too costly. Fortunately, the world has already created the necessary tools to allow many highly productive people to stay and work at or closer to home. How odd it would be if the Internet became best known as a great tool to help pave the way for a world that uses less oil.

The biggest danger the world faces, if my thesis about Saudi Arabia's oil is correct, is that no one will begin preparing Plan B. As far as I know, there is not a single contingency plan in place or currently being written by any of the think tanks of the world that sets out a model illustrating how the world can continue to function smoothly once it is clear that Saudi Arabian oil has peaked. In a nutshell, it is this total lack of any "alternative scenario thinking" that makes this unavoidable event so alarming.


Matthew R Simmons is Chairman and Chief Executive Officer of Simmons & Company International, a Houston-based investment bank that specializes in the energy industry. Mr Simmons serves on the boards of Brown-Forman Corporation and The Atlantic Council of the United States. He is also a member of the National Petroleum Council on Foreign Relations. He has an MBA from Harvard University. He is the author of Twilight in the Desert: the Coming Saudi Oil Shock and the World Economy (John Wiley & Sons, 2005), from which this essay has been excerpted.

Copyright 2005 Matthew R Simmons

http://www.counterpunch.com/simmons06212005.html

Bill Totten http://www.ashisuto.co.jp/english/

The $4.7 Trillion Pyramid

Why Social Security won't be enough to save Wall Street

by Michael Hudson

Harper's Magazine (April 2005)

They wanted something for nothing. I gave them nothing for something.
- J R "Yellow Kid" Weil

Social Security, formerly the "third rail" of American politics, has now been trod upon, in rather dramatic fashion, by George W Bush. Given that the maneuver is both stupid and unnecessary, one must ask why. After all, the program's alleged deficiencies, if there are any, will not manifest themselves until at least 2018. This is not quite the same as worrying about the sun's eventual collapse into a black hole, but for most politicians a problem that lies thirteen years in the future is nearly the same thing. Clearly all is not what it seems.

Bush himself offers two reasons for the present boldness. The first - that Social Security is "in crisis" - is easily dismissed. Government actuaries, backed by economists from across the political spectrum, insist there is no funding problem. The Social Security Administration will take in more money than it pays out for the next thirteen years; it has built up a reserve of $1.8 trillion in interest-bearing Treasury bonds for the years after that; and any later shortfall can be covered easily by even a partial rollback of the recent tax cuts for the rich.

Bush's second argument sounds more promising. If the American people will simply follow his plan, he says, they too will become rich. <1> The way the system works now, the government withholds 12.4 percent of your paycheck, up to $90,000 in annual income. In return, it promises to provide you a monthly payment - a pension - from the time you turn sixty-two until the time you die. As of this writing, the administration's alternative remains somewhat nebulous, but what is clear in all of the variations presented thus far is that you will be able to put some of your paycheck into the stock market. Bush calls these stock purchases "personal savings accounts".

<1> Bush's opponents note a possible third reason, which is that he is hoping to roll back the New Deal in favor of smaller government. It may be true that Bush dislikes the New Deal, but it is hard to envision his proposed replacement as a small-government alternative. A federally mandated transfer of funds - whether it is from taxpayer pockets to Treasury bills, as with Social Security, or from taxpayer pockets to the stock market, as under Bush's proposed changes - is still a federally mandated transfer of funds.

Vice President Dick Cheney described the benefits of these personal savings accounts in January. His example was a young woman who put away $1,000 every year for forty years. The Social Security Administration currently puts her money into Treasury bills, which at present return about two percent, so in forty years that investment would have returned about $61,000. Not too bad. "But if she invested the money in the stock market", Cheney said, "earning even its lowest historical rate of return, she would earn more than double that amount - $160,000. If the individual earned the average historical stock market rate of return, she would have more than $225,000 - or nearly four times the amount to be expected from Social Security." <2>

<2> Any relationship between the solvency of Social Security and the prospect of these personal accounts is purely rhetorical. Just before Bush's State of the Union address a reporter asked a "senior administration official" at a background briefing whether it was accurate to say that personal savings accounts themselves would have "no effect whatsoever on the solvency issue". The surprisingly candid response was , yes - "that's a fair inference".


That's a lot of math. Cheney's main point is that an upbeat assessment of the stock market - about 7.5 percent annually over forty years, by his reckoning - would easily exceed the two percent offered by Treasury bills.

There is no arguing that $225,000 is more than $61,000. On the other hand, it's not as if you get a lump sum from the Social Security Administration when you retire. The woman Cheney cited could end up taking in much more than $61,000 if she lives long enough. (The average annual payment to retirees today is about $11,000.) Or she could die on her sixty-second birthday. Like any other investment - or any other form of insurance, for that matter - Social Security is somewhat of a gamble. But then so is the stock market. By Cheney's estimation, however, today's stock market is a much better bet. "Over time", he concluded, "the securities markets are the best, safest way to build substantial personal savings".

THE ONLY WAY THE STOCK MARKET IS GOING TO GROW IS IF
WE THE PEOPLE PUT A LOT MORE OF OUR MONEY INTO IT

That is the argument, anyway. The stock market is the main chance in America, and Bush wants to let all of us in on the action. The one sure mark of a con, though, is the promise of free money. In fact, the only way the stock market is going to grow is if we the people put a lot more of our money into it. What Bush seeks to manufacture is a boom - or, more accurately, a bubble - bankrolled by the last safe pile of cash in America today. His plan is a Ponzi scheme, and in that scheme it is Social Security that is being played for the last sucker.

Retirement savings are by far the most important source of money on Wall Street. The Federal Reserve Board reports that private and public retirement accounts, not including Social Security, had assets of $10 trillion at the end of 2003. Nearly half of that, $4.7 trillion, was held in stocks. By way of comparison, the total value of all domestic stocks listed on NASDAQ, the American Stock Exchange, and the New York Stock Exchange at the end of 2003 was about $14.2 trillion.

In the past, few retirement dollars found their way to Wall Street. IRAs and 401(k)s had yet to be invented, and few companies offered private pension plans of any kind. In 1950, General Motors - then, as now, among the largest employers on earth - began to change that with a new form of compensation. The company would withhold money from paychecks, much like the Social Security Administration was doing, and add money of its own to build up a reserve to pay retirees many decades into the future. Generally called a "defined benefit" plan, the scheme guaranteed retirees a specific (defined) monthly payment until they died.

Other giants of American industry soon followed, and the funds grew quickly. In most of them, at least half the money was put into the stock market. Workers thus would gain, at least in theory, a stake in the prosperity of their company, building loyalty to management while also providing companies with a captive source of credit - their own workforce. All of that new cash contributed to the bull market of the 1950s.

Management philosopher Peter Drucker called this process "pension-fund socialism" and hailed it as the most positive social development of the twentieth century, because it would at last merge the interests of labor and capital. Louis O Kelso and Mortimer J Adler even wrote a book called The Capitalist Manifesto announcing that a new epoch of harmony between workers and owners was at hand, because soon all workers would be owners.

It didn't quite work out that way. Many companies used retirement reserves to buy their own stocks, bidding up their share price and allowing them to take over other firms on favorable terms, especially as mergers and acquisitions gained momentum in the 1960s. The problem was that when companies went bankrupt - especially small firms - the collapse also wiped out the pension funds invested in those companies. Employees of such companies found themselves not only out of work but stripped of the money they thought was being saved up for their retirement.

Congress moved to limit such behavior by obliging corporate pension funds to be run by arm's-length trustees, although workers were still permitted (and often encouraged) to keep their pensions in the stock of their employers. To further protect workers, Congress created the Pension Benefit Guarantee Corporation (PBGC) in 1974. All corporate pension plans were required to buy federal insurance, through the PBGC, to protect workers in the event of a failed investment scheme or corporate bankruptcy. The plans themselves were still prone to risk, but at least the pensions would be backed by the government and workers could feel secure about their retirement. <3>

<3> Although as former employees of Enron and WorldCom recently learned, the price of demonstrating loyalty still can be quite steep.


Most companies now offer their employees a broad array of mutual funds instead of just their own stock. In itself this is good common-sense investing practice, and it also protects fund managers from charges of scheming. The other result of this practice is that workers' fortunes are now tied not just to their own companies but to the market as a whole.

Which is where and how we come to both the problem and the scam. While fears regarding the solvency of Social Security are unwarranted, many corporate pension plans - the ones that have been so important in bankrolling the stock-market rise of the past few decades - are themselves threatening to go bust, taking their parent companies down with them. The financial rot already has begun to seep into the airline and steel industries, and the auto sector may be next. (General Motors reports that its current pension obligations add $675 to the cost of every vehicle it produces.)

COMPANIES SIMPLY HAVEN'T BEEN PUTTING AWAY ENOUGH
MONEY TO PAY RETIREES WHAT THEY ARE OWED

The shortfalls aren't just a matter of bad luck. For quite a few years now, companies simply haven't been putting away enough money to pay retirees what they are owed. The PBGC estimates that the underfunding of traditional defined-benefit plans, for instance, deepened by $100 billion last year, to a total of $450 billion. The problem was created by fund managers and CFOs who believed - or at least pretended to believe - that pension reserves could grow at fantastic rates of return forever. Milliman USA, a benefits consulting firm, reports on the assumed rates of return on pension investments at the hundred largest firms in America. How high did these companies bet? In 2000 and 2001, the median projected rate of return was 9.5 percent. In 2002 in was 9.25 percent. And in 2003 it was 8.55 percent.

These are wildly optimistic projections, even by Dick Cheney's standards. Last summer the Financial Times noted that they conflict not only with present reality but with warnings from such mainstream investment experts as Peter Bernstein, Jeremy Siegel, and Jeremy Grantham that "we have entered a low-return environment" and that as a result many investors are expecting long-term returns closer to seven percent or five percent. Even these rates seem overly exuberant, given that the top hundred corporate pension funds earned an average annual investment return of just 1.3 percent between the end of 1999 and the end of 2003. <4>

<4> A three-year Treasury bill purchased at the end of 1999 would have returned 6 percent.


At the beginning of 2001, for instance, IBM proposed that it would earn $6.3 billion on pension-fund assets of $61 billion - about ten percent. This was an astonishing demonstration of confidence given that IBM had earned only $1.2 billion on those assets the previous year. In the event, IBM actually went on to lose $4 billion in 2001. Barely daunted, the company's managers predicted a 9.5 percent return in 2002. They lost another $7 billion. In 2003 they predicted a return of $6 billion, and - as the market began to recover - they at last beat their prediction, by $4.4 billion. The result of this "recovery" is that, since George W Bush took office, IBM's pension-fund assets have plummeted by more than $1 billion. Nonetheless, corporate fund managers across America remain optimistic.

THE CHOICE BETWEEN LIVING UP TO THEIR PENSION PROMISES OR REPORTING HIGHER NET EARNINGS WAS EASY

Such errors in judgment are seldom accidental. In pretending that their funds could generate high returns, managers sought a real - albeit short-term - advantage. The faster companies projected their funds to grow, the less they had to set aside to pay their retirees. The lower setasides in turn allowed them to report higher earnings, thereby driving up the price of the company's own stock to "create shareholder value". Faced with a choice between living up to their pension promises or reporting higher net earnings, companies simply decided not to live up to their employee agreements. <5>

<5> Plans with more realistic projected rates were deemed "overfunded" and emptied out.


The practice is not one that can be sustained across forty years. It is a kind of Ponzi scheme, in which present profits are paid for by the promise of future stock-market gains. At some point retirees are going to want the money they are owed. The last few years have seen the results of these broken promises in the form of lawsuits, bankruptcy, and, ultimately, retirees being forced to live on far less than they were promised.

In the end, it is the PBGC that pays when the plans go bust. Here, however, the problem deepens considerably, because picking up the total bill for the corporate sector's underfunding would bankrupt the PBGC itself.

Last November the PBGC reported that although it had "operated for several years with virtually no claims", the end of the stock-market boom has given way to "a period of record-breaking claims". As recently as 2001 the PBGC had a surplus of $8 billion, but a series of bankruptcy cases pushed it $23 billion into deficit last year, a year in which it took in only $1.5 billion in premiums. The PBGC would need more than fifteen years just to make up its current deficit, with new claims arriving all the while. The PBOC has proposed that companies follow more realistic accounting rules and pay premiums that reflect the true risks of their underfunding. It also is asking for stricter limits on the ability of companies to escape their pension debts by declaring bankruptcy. <6>

<6> Reasonable as these requests seem, they are being opposed by the same corporate managers who created the mess in the first place. Last year the American Benefits Council, the lobbying organization of pension-fund managers, persuaded regulators to even further loosen me requirement that companies estimate realistic rates of return.


Without such changes the PBGC will be forced into bankruptcy and the government will have to bail it out. That could cost as much as $95 billion, according to the Congressional Research Service. At that point only today's profits would remain private. The losses will have been fully socialized. <7>

<7> That estimate is probably low. The precedent is the bailout of the Federal Savings and Loan Insurance Corporation, which ended up costing taxpayers $200 billion.


SOMETHING HAS TO GIVE - EITHER THE HOPES OF RETIREES
OR THE HOPES OF THE STOCK MARKET

Barring some sudden influx of capital, something has to give - either the hopes of retirees or the hopes of the stock market. Unfortunately, this is a zero-sum game in which many Americans are on both sides at once. Higher pension set-asides will diminish corporate earnings. Lowered earnings in turn will lead to dividend cuts and job losses. Low dividends and high employment will decrease the demand for stocks - leading to further declines in the ability of pension funds to pay retirees, with more defaults all around. Workers, retirees, investors, and taxpayers thus find themselves yoked to the fortunes of the financial managers who created this situation.

This is hardly the kind of happy pension-fund socialism that Peter Drucker had in mind, in which worker-owners share risks and rewards alike as they create the goods and services demanded by a thriving marketplace. In fact, what has happened is that companies have made a great effort not merely to share the risk but to off-load it entirely onto the backs of their employees, the government, and taxpayers in general.

This phenomenon of risk rolling downward can be seen most clearly in the move by many companies from defined-benefit programs - in which employees are guaranteed a specific retirement payment, based on their salary history - to "defined-contribution plans", in which workers know nothing else except how much is being deducted from their paychecks. The payout rate is decided by how well the stock market performs, which shifts the risk onto employees even as it frees up more revenue for their employers and generates rich commissions for money managers. The risk flows down the economic scale even as the cash flows up.

Given the widespread problems confronting pensions outside the embrace of the federal government, now would seem an odd time for the administration to campaign for Social Security privatization. Why would anyone want to invest America's last line of pension defense in so perilous a market? Are Bush and his advisers unaware of the odds?

Probably not. Therefore, they must have a particular idea in mind. Presumably they believe that some kind of market recovery is needed not only to rescue the PBGC but to rescue the pension funds, to rescue the stock market, and, for that matter, to rescue the political fortunes of the ruling party - that what is needed, in fact, is a Bush boom. After all, such a boom would allow us to "grow our way out of trouble", as we have done so many times before.

But where will the funds come from to bid up stock prices? The national savings rate is nearly zero, because most personal discretionary income - like that of most companies - is absorbed in repaying debts. Previously, the Fed could have flooded the capital markets with credit to lower interest rates and thereby spur a bond and stock-market bubble. But interest rates are at their lowest since the 1950s. They can go no lower. <8>

<8> After World War II interest rates rose to a peak, in 1980, of more than 21 percent. The result was nearly four decades of capital losses on bonds - whose interest rates are fixed at the time you buy them - and a steady rise in stocks. Since 1980, however, interest rates have fallen back, creating the greatest bond-market boom in history.


There is only one other place to turn. The new flow of funds into the stock market will have to come from labor itself, just as it did back in the 1950s. Social Security is the greatest plum of all, so large as to virtually guarantee a boom.

MANY OF HISTORY'S MOST FAMOUS BUBBLES HAVE BEEN
SPONSORED BY GOVERNMENTS IN ORDER TO GET OUT OF DEBT

Talk of bubbles has become popular in recent years, but most discussions miss the key point. Although optimism is inherent in the human spirit, it rarely effloresces into the kind of frenzy necessary to float a bubble without help from the government. In fact, many of history's most famous bubbles have been sponsored by governments in order to get out of debt. Britain, in 1711, persuaded bondholders to swap their bonds for stocks in the South Sea Company, which was expected to get rich off the growth industry of its day, the African slave trade. By the time the South Sea bubble collapsed, the government had indeed paid off its war debt - and speculators were left holding worthless "growth sector" stocks. In 1716, John Law organized France's Mississippi bubble along the same lines, retiring France's public debt by selling shares to create slave-stocked plantations in the Louisiana territories. It worked, for a while.

The US government is now attempting to run the same kind of scam. Bush would like to persuade Social Security claimants to exchange the security of US Treasury bonds for a chance to buy growth stocks on which a much higher return is hoped for. No modern blue-sky venture comparable to the South Sea or Mississippi companies is needed. The stock market itself has become a bubble, borne aloft from the burden of generating actual goods and services by a constant flow of new retirement dollars.

There is no denying that channeling trillions of Social Security dollars into the stock market would produce short-term gains. But once this money is spent, the markets are likely to retreat. That is what happens after a financial bubble. Then we will be right back where we are today, only much the poorer and with no guaranteed pension system for elderly Americans - who will, of course, need guaranteed pensions more than ever as they watch their stock holdings continue to shed value. Indeed, many other countries are just now recovering from their own dismal experiences with what Augusto Pinochet and Margaret Thatcher called "labor capitalism" and Bush calls, with no apparent irony, an "ownership society". <9>

<9> In Chile conglomerates invested employee paycheck withholding in their own stocks or in loans to affiliates whose value then was wiped out in financially engineered bankruptcies. The problem got so bad by 1980 that the government turned over management to American and other international firms. Most discussions of Chile's "success story" choose to start at the trough right after these fraudulent bankruptcies, which of course gives a steep trough-to-peak tilt for the rate of return that is claimed to be normal. The equivalent for America would be to start a new trend right after a 1929-type stock-market crash. When one starts from a peak, such as today, it is much harder to give the statistical impression that a fantastic takeoff is in store.


In the 1930s, John Maynard Keynes urged governments to run budget deficits in order to increase the economy's spending power on goods and services. His point of reference was the "real economy" - the economy of production and consumption, of investment in capital and in the labor to operate that capital. Whereas Keynes spoke of governments priming the pump with public spending programs to get domestic investment and employment going, Bush now seeks to prime the stock-market pump with Social Security contributions. <10> It is the next natural step from our real economy to the economy of dreams.

<10> The genius of recent administrations, Democratic and Republican, has been to transfer inflation to the stock market - that is, to the prices of stocks and bonds instead of to the prices of labor and production. Real wages today are lower than they were in 1964.


Michael Hudson is Distinguished Professor of Economics at the University of Missouri, Kansas City, and the author of many books on international and domestic finance, including Super Imperialism: The Origin and Fundamentals of US World Dominance.

http://www.michael-hudson.com/

Bill Totten http://www.ashisuto.co.jp/english/

Capitalism's future on trial

The European Union's crisis has obscured the fact that it has
come closest to balancing market dynamism and social protection

by Jeremy Rifkin

The Guardian (June 22 2005)

Europe has plunged into a crisis of meaning in the wake of the repudiation of the EU constitution by voters in France and the Netherlands - and the Brussels summit breakdown. At the root of the crisis is a deep angst over the dire state of domestic and European economic affairs.

The neoconservatives argue that the only way out of the economic malaise facing Europe is to deconstruct decades of social benefits that have come to define the European notion of quality of life in a socially responsible society, and unfetter the marketplace so that competition can run free. If Europe does this, they say, the economy will grow and the people will prosper.

The socialists argue, on the other hand, that the unrestrained Anglo-American liberal market model rewards the rich by beggaring the working class and results in a meaner and more bereft social order.

In a curious way, what is really on trial is not the EU constitution but the future of capitalism itself. An increasing number of Europeans are asking themselves whether the liberal market model or the social market model is the best approach to charting the economic future.

Today, while corporate profits are soaring around the world, 89 countries find themselves worse off economically than they were in the early 1990s. Capitalism promised that globalisation would narrow the gap between rich and poor. Instead the divide has widened. The 356 richest families on the planet enjoy a combined wealth that now exceeds the annual income of forty percent of the human race. Two-thirds of the world's population have never made a phone call and one-third have no access to electricity.

The champions of capitalism pledged to promote sustainable economic development; yet we continue to squander our remaining fossil-fuel reserves, spewing increasing amounts of carbon dioxide into the atmosphere, destroying the world's ecosystems and habitats, with the prospect of catastrophic climate change.

Our business leaders decried the corruption that permeated the old centralised communist regimes, while many engaged in equally egregious corporate corruption, bringing down some of the world's "most trusted" companies.

Why have the two dominant ideologies of the industrial age so utterly failed? Because the central tenet of each was not sufficiently tempered by the antidote of the other. The central tenet of communism is best expressed in the oft-heard aphorism "from each according to his ability, to each according to his need". In practice, however, communism created a form of paternalistic governance that robbed the individual of any semblance of autonomy. In the end, everyone was subject to the dictates of impersonal state-run bureaucracies.

The central tenet of capitalism is found in the words of the Scottish Enlightenment economist Adam Smith. He believed that an invisible hand ruled over the market place, guaranteeing that everyone would eventually benefit, if only the market mechanism were left unencumbered. Neoconservative economists and politicians still believe this.

In reality, the invisible hand has turned out to be nonexistent. Left to its own internal logic, the unfettered market leads not to a bigger share of the economic pie for all but a "winner takes all" endgame.

Is capitalism salvageable? Yes, but only if we are willing to have a frank discussion. The strength of capitalism is, paradoxically, also its weakness. The market caters to the pursuit of individual self-interest, and is therefore almost pathologically innovative. The entrepreneurial spirit, technological innovation and productivity advances exceed any other economic system ever devised.

But capitalism does not fairly distribute the fruits of economic progress. That's because the logic in the boardroom is always to cut production costs in order to maximise profits and shareholder value. This means reducing, whenever possible, the share of the gains that goes to workers, as well as cutting the expense of preserving the natural environment upon which all future economic activity depends.

In a globally connected world, the hope for humanity rests on creating a balance that encourages and stimulates the entrepreneurial spirit of the market while tempering its inherent propensity to run wild and concentrate more and more power at the top. Countervailing forces, in the form of a strong trade-union movement, a diverse and healthy civil society and vigilant political parties, need to rein in the potential abuses and exploitation of capitalist practices by ensuring a just redistribution of the benefits of the market with the appropriate social programmes - without, however, stifling market incentives. This is a tricky balancing act.

We ought to consider capitalism and socialism as complementary "visible hands" that continually balance individual self-interest in the market with a collective sense of responsibility for each other's welfare.

The social market-economy model practised across the member states of the European Union comes closest to this mechanism. Unfortunately, the current economic debate in Europe threatens to polarise public opinion - pitting unrestrained market forces against the bureaucratic dictates of a welfare state. The difficult task at hand is pursuing an intelligent and sophisticated course that maintains a balanced tension between the entrepreneurial spirit of capitalism and the social solidarity of socialism without either vision vanquishing the spirit of the other. We are, after all, each and every one of us, an embodiment of both spirits. We desire to pursue our own self-interests while mindful of our responsibilities to our fellow human beings. A reformed European social economy that allows both aspects of human behaviour to flourish is a model for the rest of the world to follow.


Jeremy Rifkin is the author of The European Dream: How Europe's Vision of the Future is Quietly Eclipsing the American Dream.

Guardian Unlimited - Copyright Guardian Newspapers Limited 2005

http://www.guardian.co.uk/comment/story/0,3604,1511718,00.html


Bill Totten http://www.ashisuto.co.jp/english/

Third World, Here We Come

by Charley Reese

King Features Syndicate (June 13 2005)


Many Americans are living in a state of delusion, fed by the politicians who keep telling us we're the greatest, the strongest, the freest, the wealthiest, et cetera, et cetera, and so forth. Actually, we are heading toward becoming a Third World country.

The difference between a First World country and a Third World country is this: First World countries manufacture finished goods and import raw materials; Third World countries export raw materials and import manufactured goods.

Why does this account for a difference in standard of living? It's easy to explain. A skilled machinist adds more value to a product than someone who flips a burger with a spatula. Therefore, the machinist can demand a higher salary. Unfortunately, our manufacturing base is rapidly diminishing, and the villains are none other than our own corporate executives, who are moving production to cheap-labor countries.

The law of supply and demand works this way in regard to labor. Countries that have a surplus of people can bid the price of labor way down. India, China and Central America have a surplus of people. The alternative in those countries to taking a job with stingy wages and no benefits is to face no job and no income.

That was the old way of looking at economics, but there is a new factor that makes the old economic theory break down. That new factor is the multinational corporation. Much of what the US government classifies as "exports" and "imports" are really nothing more than intracorporate transfers.

Under the old theory, if, say, all the bluejeans sold in America were manufactured in El Salvador, then El Salvador would prosper. After all, it would be exporting manufactured goods. Unfortunately for El Salvador, under the new theory all of the bluejean factories would be owned by American corporations. Thus, the multinational corporation screws both the people of El Salvador and the American consumer. The Salvadoran gets a low wage, and the American consumer pays an inflated price for a very cheaply produced garment. The capitalists pocket the profits.

But in the meantime, what happens to the Americans? Well, as their income is reduced by the loss of high-paying manufacturing jobs, they will at first take out second mortgages and max out their credit cards in a vain attempt to maintain their standards of living. This will eventually, however, result in bankruptcies and foreclosures. Interest will eat them alive. Then there will be a shrinking market for the high-priced goods no matter where they are manufactured.

Poverty will also affect the services sector. Poor people can't afford a doctor, a lawyer, an architect, an interior decorator, life or medical insurance, a nursing home or a funeral. The idea once touted by the wet-behind-the-ears gurus in Washington that we could easily replace manufacturing with services is false. A consumer economy only works if the consumers have money to spend, and they can only have money to spend if they can find jobs that pay a decent wage.

You can see the signs of the gradual impoverishment of America if you think about what is happening. First, supermarkets started accepting credit cards; then fast-food joints did. Many car dealers are now reduced to "sign and drive" promotions - nothing down, low monthly payments. What all of that tells you is that more and more Americans are squeezed for income.

All of this damage has been done under the guise of free trade. That is a false label. It's actually managed trade, and it's designed to facilitate the off-shoring of American jobs. The evidence of the failure of this policy is plain, but ignored. It has produced nothing but huge trade deficits and turned us into a debtor nation. The amount of US dollars held by Asian countries is about $1 trillion. We will eventually be tenants in our own country if we don't change course.

President George Bush likes to talk about an "ownership society", but what he and his predecessors are creating is a "sharecropper's society". The only consolation Americans will have when everything goes south is that they will have done it to themselves.

Copyright 2005 by King Features Syndicate, Inc.

http://reese.king-online.com/Reese_20050613/index.php

Bill Totten http://www.ashisuto.co.jp/english/

Bards of the Powerful

Far from challenging the G8's role in Africa's poverty, Geldof and Bono are legitimising its power.

by George Monbiot

Published in the Guardian (June 21 2005)

"Hackers bombard financial networks", the Financial Times reported on Thursday. Government departments and businesses "have been bombarded with a sophisticated electronic attack for several months". It is being organised by an Asian criminal network, and is "aimed at stealing commercially and economically sensitive information". <1> By Thursday afternoon, the story had mutated. "G8 hackers target banks and ministries", said the headline in the Evening Standard. Their purpose was "to cripple the systems as a protest before the G8 summit". <2> The Standard advanced no evidence to justify this metamorphosis.

This is just one instance of the reams of twaddle about the dark designs of the G8 protesters codded up by the corporate press. <3> That the same stories have been told about almost every impending public protest planned in the past thirty years and that they have invariably fallen apart under examination appears to present no impediment to their repetition. The real danger at the G8 summit is not that the protests will turn violent - the appetite for that pretty well disappeared in September 2001 - but that they will be far too polite.

Let me be more precise. The danger is that we will follow the agenda set by Bono and Bob Geldof.

The two musicians are genuinely committed to the cause of poverty reduction. They have helped secure aid and debt relief packages worth billions of dollars. They have helped to keep the issue of global poverty on the political agenda. They have mobilised people all over the world. These are astonishing achievements, and it would be stupid to disregard them.

The problem is that they have assumed the role of arbiters: of determining on our behalf whether the leaders of the G8 nations should be congratulated or condemned for the decisions they make. They are not qualified to do so, and I fear that they will sell us down the river.

Take their response to the debt relief package for the world's poorest countries that the G7 finance ministers announced ten days ago. Anyone with a grasp of development politics who had read and understood the ministers' statement could see that the conditions it contains - enforced liberalisation and privatisation - are as onerous as the debts it relieves. <4> But Bob Geldof praised it as "a victory for the millions of people in the campaigns around the world", <5> and Bono pronounced it "a little piece of history". <6> Like many of those - especially the African campaigners I know - who have been trying to highlight the harm done by such conditions, I feel betrayed by these statements. Bono and Geldof have made our job more difficult.

I understand the game they're playing. They believe that praising the world's most powerful men is more persuasive than criticising them. The problem is that in doing so they turn the political campaign developed by the global justice movement into a philanthropic one. They urge the G8 leaders to do more to help the poor. But they say nothing about ceasing to do harm.

It is true that Bono has criticised George Bush for failing to deliver the money he promised for AIDS victims in Africa. But he has never, as far as I can discover, said a word about the capture of that funding by "faith-based groups": the code Bush uses for fundamentalist Christian missions which preach against the use of condoms. <7> Indeed, Bono seems to be comfortable in the company of fundamentalists. Jesse Helms, the racist, homophobic former senator who helped engineer the switch to faith-based government, is, according to his aides "very much a fan of Bono". <8> This is testament to the singer's remarkable powers of persuasion. But if people like Helms are friends, who are the enemies? Is exploitation something that just happens? Does it have no perpetrators?

This, of course, is how George Bush and Tony Blair would like us to see it. Blair speaks about Africa as if its problems are the result of some inscrutable force of nature, compounded only by the corruption of its dictators. He laments that "it is the only continent in the world over the past few decades that has moved backwards". <9> But he has never acknowledged that - as even the World Bank's studies show <10> - it has moved backwards partly because of the neoliberal policies it has been forced to follow by the powerful nations: policies that have just been extended by the debt relief package Bono and Geldof praised. Listen to these men - Bush, Blair and their two bards - and you could forget that the rich nations had played any role in Africa's accumulation of debt, or accumulation of weapons, or loss of resources, or collapse in public services, or concentration of wealth and power by unaccountable leaders. Listen to them, and you would imagine that the G8 was conceived as a project to help the world's poor.

I have yet to read a statement by either rock star which suggests a critique of power. They appear to believe that a consensus can be achieved between the powerful and the powerless, that they can assemble a great global chorus of rich and poor to sing from the same sheet. They do not seem to understand that, while the G8 maintains its grip on the instruments of global governance, a shared anthem of peace and love is about as meaningful as the old Coca-Cola ad.

The answer to the problem of power is to build political movements which deny the legitimacy of the powerful and seek to prise control from their hands: to do, in other words, what people are doing in Bolivia right now. But Bono and Geldof are doing the opposite: they are lending legitimacy to power. From the point of view of men like Bush and Blair, the deal is straightforward: we let these hairy people share a platform with us, we make a few cost-free gestures, and in return we receive their praise and capture their fans. The sanctity of our collaborators rubs off on us. If the trick works, the movements ranged against us will disperse, imagining that the world's problems have been solved. We will be publicly rehabilitated, after our little adventure in Iraq and our indiscretions at Bagram and Guantanamo Bay. The countries we wish to keep exploiting will see us as their friends rather than their enemies.

At what point do Bono and Geldof call time on the leaders of the G8? At what point does Bono stop pretending that George Bush is "passionate and sincere" about world poverty <11>, and does Geldof stop claiming that he "has actually done more than any American president for Africa"? <12> At what point does Bono revise his estimate of Tony Blair and Gordon Brown as "the John and Paul of the global development stage" or as leaders in the tradition of Keir Hardie and Clement Attlee? <13> How much damage do Bush and Blair have to do before the rock stars will acknowledge it?

Geldof and Bono's campaign for philanthropy portrays the enemies of the poor as their saviours. The good these two remarkable men have done is in danger of being outweighed by the harm.

www.monbiot.com

References:

1. Maija Pesola, 16th June 2005. Hackers bombard financial networks. Financial Times.

2. Mark Prigg, 16th June 2005. ‘G8' hackers target banks and ministries. Evening Standard

3. For more examples, see David Miller, 16th May 2005. How to Spin the G8. http://www.spinwatch.org/modules.php?name=Content&pa=showpage&pid=360

4. G8 Finance Ministers, 10-11 June 2005. Conclusions on Development. http://www.hm-treasury.gov.uk/otherhmtsites/g7/news/conclusions_on_development_110605.cfm

5. Ashley Seager, Larry Elliott and Patrick Wintour, 13th June 2005. Brown urges rich countries to act now. The Guardian.

6. AFP, 11th June 2005. Bono Hails Group of Eight on Debt Relief.

7. Lindsey Hilsum, 13th June 2005. World view. New Statesman; Rachel Rinaldo, 24th May 2004. Condoms Take a Back Seat to Abstinence With U.S. AIDS Money. Inter Press Service; John Tarleton, 1st June 2003. On The Eve Of G8 Summit, Bush Delivers Emergency Aids Relief To Republican Allies.
http://www.zmag.org/content/print_article.cfm?itemID=3707§ionID=1

8. Madeleine Bunting and Oliver Burkeman, 18th March 2002. Pro Bono. The Guardian.

9. Tony Blair, 27th May 2005. Statement to the Africa Commission in Rome.
http://www.number-10.gov.uk/output/Page7577.asp

10. eg William Easterly, February 2001. The Lost Decades: Developing Countries' Stagnation in Spite of Policy Reform 1980-1998, World Bank.

11. Rory Carroll, 18th September 2003. Pop star's relations with Bush turn sour. The Guardian.

12. Josh Tyrangiel, 19th June 2005. Three big shots, eight very big shows. Time magazine.

13. Bono, 29th September 2004. A chance for real change in Africa. Speech to the Labour Party Annual Conference, Brighton.

http://www.monbiot.com/archives/2005/06/21/bards-of-the-powerful-/

Bill Totten http://www.ashisuto.co.jp/english/

The Iceberg Cometh

Can a nation of spenders be saved?

Harper's Magazine (June 2005)


If we can believe what we read in the newspapers, the American economy, formerly believed to be as unsinkable as the Titanic, appears to be steaming toward an iceberg. Most of the experts and nearly all of the navigational aids point in the direction of catastrophe - a $666 billion deficit in international transactions last year, a 24 percent increase over the prior year; a federal budget deficit of more than $400 billion; a dollar that has lost more than a third of its value against the euro since 2001. Not too long ago, America was the world's largest creditor; today it is the world's largest debtor, our solvency dependent upon the benevolence of foreign banks. Meanwhile, belowdecks, the cost of maintaining our rapidly rising number of elderly people threatens over the next few decades to overwhelm the federal budget. A respected credit agency recently noted that by 2026, barring a change in our fiscal policy, US Treasury bills - once the world's de facto gold standard - will be classified as junk bonds.

How do we save the ship? Even if the American people mend their spendthrift ways, will our politicians be able to confront the necessity for restraint? To speak to these questions, Harper's Magazine brought together three of our nation's most notable economic thinkers and charged them with charting a new course toward financial safety.

The following forum is based on a discussion that took place at the offices of The Blackstone Group, in New York City. Lewis H Lapham served as moderator.

LEWIS H LAPHAM is editor of Harper's Magazine.

GLENN HUBBARD is dean of the Graduate School of Business at Columbia University. From 2001 to 2003 he was head of the Bush Administration's Council of Economic Advisers.

PAUL KRUGMAN is an op'ed columnist for the New York Times and a professor of economics at Princeton University. He is the author of, among other books, The Great Unraveling (Norton).

PETER G PETERSON is senior chairman of The Blackstone Group and chairman of the Council on Foreign Relations; from 1972 to 1973 he served as US Secretary of Commerce. His most recent book is Running on Empty (Farrar, Straus and Giroux).


I: ADRIFT IN INTERNATIONAL WATERS

LEWIS H LAPHAM: Apparently there are so many angles from which to look at the iceberg that it's hard to know which ones matter and which ones don't. Let's begin with our borrowing from over seas. How grim is the view from the crow's nest?

PETER G PETERSON: We reached the previous record "current account deficit" in the 1980s, in the Reagan years, when it was running at 3.5 percent of GDP. This deficit is now edging upward toward six percent, and many people at the Federal Reserve Bank of New York, which I used to head, think that it will move toward seven percent or even higher - a level that is roughly twice, in terms of the GDP, anything we've ever experienced before.

LAPHAM: What, exactly, do we mean by the "current account deficit"? And why has it increased so sharply in the past decade?

PAUL KRUGMAN: It's basically the trade deficit - exports against imports - but it also includes interest that we're paying on debts, the earnings of US corporations abroad, et cetera. Think of it as the trade deficit broadly defined. It's the difference between the total amount Americans spend - including things like interest payments to foreigners - and their total income - including things like the profits of American multinationals operating in other countries.

GLENN HUBBARD: Remember, though, that the mirror of the current account is what's called the "capital account", which tracks funds flowing in or out for investments and loans. Another way to look at the current account deficit is that there's substantially more investment being done in the United States than there are savings.

KRUGMAN: Yes, the current account deficit is a capital account surplus. The question is, does that make it okay? We can consider some examples from recent history: our current account deficit is bigger as a share of GDP than Indonesia's, or Argentina's, before their respective financial crises. When the money was flowing into Argentina during the nineties, people said, "Oh, no problem. Look, it's a great business environment, high growth rate. That's why the money is flowing in." But in the end, it all went to hell pretty spectacularly, in a span of only about eighteen months. By 2002, Argentina looked like old newsreels from the Great Depression, with angry former members of the middle class rummaging in garbage cans for food, and housewives banging pots and pans outside the presidential palace demanding that the government resign - which it did.

HUBBARD: I agree that the size of the current account deficit is very troublesome. Most of our major trading partners - all besides China - are not growing as rapidly as the United States. With the US growing so fast, and our major, non-China trading partners growing so slowly, it's inevitable that in the near term we would have a large current account deficit. But the current account deficit as a share of GDP can not continue to expand in the way that it has.

Having said that, we don't really know how the adjustment will take place. We can't extrapolate easily from the experience of other countries. The United States dollar is the reserve currency for most of the world, and we've never seen a reserve-currency country in this position.

KRUGMAN: That's true. America is not Argentina. What turned the plunge of the peso into an eco nomic collapse was the fact that Argentina's debt was held in dollars. When the peso fell, banks and businesses found their debt in pesos exploding, and pretty much everyone went bankrupt. We hold our foreign debt in our own currency, so the immediate capital loss from a weakened dollar falls not on US businesses but on foreign central banks - mainly the Bank of Japan and the People's Bank of China, which finance almost all of our current account deficit.

That's a big change. In the nineties, foreign capital was Daimler buying Chrysler. Today, it's the People's Bank of China buying US Treasury bills.

PETERSON: The economist C Fred Bergsten puts it pretty well. He says, "I finally understand supply-side economics. They supply the goods, and they also supply the money". This dysfunctional dependence, over time, is clearly unsustainable.

HUBBARD: It may be dysfunctional, but it's a dysfunction of symbiosis. China's mercantilist trade policy is just the flip side of our own. The People's Bank of China is certainly not likely to adjust its policies tomorrow, because to do so would confer huge capital losses on China's economy: their currency would rise significantly against the dollar - reducing the value of their dollar holdings - and their exports would decline.

Nothing in this story suggests to me any kind of imminent crisis. It is really a question of how quickly we adjust, and what the right remedy is. I don't hear any disagreement with the notion that what the US economy must do is raise national savings. But I think it's extremely unlikely that there's go ing to be any calamitous collapse. It's not in the interest of our trading partners. In my view, the adjustment will take place through gradual increases in domestic demand in Asia and gradual increases in national savings here.

KRUGMAN: I would say that there is a fifty percent chance that the outcome is pretty calamitous. Partly that's just career bias, since I spent many years as an economist studying crises. And too many times I saw examples of finance ministers saying, "Of course we can't do this forever, but in the near term it's perfectly sustainable". The fact is that every time a country runs a large current account deficit for a sustained period of time, explanations emerge of why this one isn't a problem. The scariest words you can hear about financial markets are, "It's different this time".

PETERSON: There's also a big long-term risk that we need to consider: many of the foreign coun tries we're depending on have far more daunt ing demographic issues and benefit levels than we do. Birth rates in Europe and Japan are down at 1.2 to 1.5 babies per couple, way below the replacement rate. Italy's going to lose 45 percent of its workforce in the next thirty years. How can we continue to depend on these people to lend so much of their savings to this country? Remember, they, too, have retirement programs that will need to be funded by a rapidly shrinking number of younger taxpayers.

At the Council on Foreign Relations I had a discussion with Haruhiko Kuroda, Japan's former vice minister of finance. The discussion went as follows. "Mr Kuroda", I asked, "are you going to have significant problems with an aging society?"

"Oh yes, Mr Peterson. Very, very big problem".

"Mr Kuroda, you're on a pay-as-you-go basis. How are you going to finance your deficits?"

"Well", he says, "unlike you, we have a big savings rate and a big current account surplus, and so forth. We can use that for a while."

"Mr Kuroda, but you're financing 25 percent of our current account deficit. Have you figured out how to spend the same money twice?"

He said, "Ah, serious problem".

LAPHAM: Clearly our profligacy will have to be paid for eventually. But when? On the evidence of the dollar's decline against the euro during the past four years, it seems as if the foreclosure proceedings may have already begun.

HUBBARD: But remember that the exchange rate is simply a price. When I observe that the price of something is high, I don't necessarily think things aren't well. If you look at the underlying fundamentals, I don't think you would trade the underlying fundamentals of the American economy for the underlying fundamentals of the Eurozone, despite the dollar's recent loss of value. So I would caution you about looking at prices of things when making observations about economies. My own prediction is that over the long term, America's relatively high productivity and low inflation will keep the dollar's exchange value strong.

KRUGMAN: But even under the happy scenarios in which the current account deficit fades away, and we don't have a financial crisis, and we balance the budget, and the domestic savings rate goes up - the dollar would still have to fall. The fall of the dollar is the transmission mechanism through which the elimination of the current account deficit occurs. That is, American companies have to be given an incentive to export more, and American consumers have to be given an incentive to buy fewer imports, and a falling dollar is how that happens. The big question is whether the inevitable fall of the dollar takes place in a way that causes a lot of harm.

PETERSON: Paul Volcker, the former chief of the Federal Reserve, went so far last year as to do something he rarely does in life: he was constructively unambiguous. He said there was a 75 percent chance in five years of a dollar crisis, or a "hard landing". And Robert Rubin, the former treasury secretary, is more or less in that school - he speaks of a "day of reckoning".

LAPHAM: By the phrases "hard landing" and "day of reckoning", you mean exactly what?

PETERSON: The particulars would be difficult to predict. Such a landing could be touched off by an imprudent comment by a treasury secretary, or by some bad economic news, or by some geopolitical event - a situation in which, for some reason, foreign investors lose confidence in America's financial stability. Then a steep fall of the dollar, a huge spike in interest rates. This kind of landing would have a variety of very damaging effects on the economy. To take one example, just imagine the effects on real estate and on real-estate financing costs. Thirty-five percent of new mortgages in the United States today are on floating rates, so an interest-rate spike would cause mortgage payments to skyrocket. These are risks a great country should not be taking.


II. RIGHTING THE SHIP OF STATE

LAPHAM: An American who aspires to save rather than spend will find no role model in his federal government, which during the past four years has approved some $1.5 trillion in new spending while also handing out $1.7 trillion in tax cuts. The extravagance seems all the more irresponsible because of the reconfiguration of the country's demography: three decades hence, the elderly, today only twelve percent of Americans, will make up a full fifth of the population.

PETERSON: Clearly, as you look at the numbers, the great perils we face are in the growth of entitlements - Social Security, Medicare, Medicaid. That's where the huge increases are occurring in terms of percent of GDP. Over the next forty or fifty years, the costs of these programs are expected to go up by about nine percent of GDP, or nearly three times what we're spending on defense.

KRUGMAN: Even if, in the next decade or so, we get through our near-term budget problems - which I think will be very severe - then we're left with the problems of Social Security and, especially, Medicare. Although we have the least generous welfare state in the Western world, this isn't true when it comes to old people.

LAPHAM: Then how can we possibly solve the problem?

PETERSON: You're going to solve that in only three ways. First, you can increase revenues by increasing taxes. Second, you can cut benefits. Third, you can go out and try to borrow the money, but it's one hell of a lot of money that you're talking about borrowing - tens of trillions of dollars over the next fifty years.

HUBBARD: The size of that number suggests why tax increases can't be the major part of the solution. According to the Congressional Budget Office, assuming no change in policy, Social Security and Medicare a generation from now will consume ten more percentage points of GDP than they do today. Just for reference, the entire federal tax share of GDP is traditionally a number like eighteen percent. So you would be talking about a fifty percent increase in all taxes, across the board.

LAPHAM: Didn't we have a seventy percent tax rate as recently as 1980?

HUBBARD: Yes, we did. When President Reagan came into office, seventy percent was the top marginal rate.

LAPHAM: So we can live with a higher tax rate.

HUBBARD: Well, there's a substantial body of economic research to suggest that the lower marginal tax rates since then have stimulated savings, investment, entrepreneurship. And to solve our entitlements problem with tax increases, it would not just be a matter of restoring 1970s tax rates. It's not just that top rates would have to go up. I am describing a tax increase of fifty percent. And I don't mean for the rich. I mean every tax collected in America.

KRUGMAN: Every federal tax.

HUBBARD: You could not raise that amount of money on a soak-the-rich strategy.

PETERSON: A tax increase can't provide the bulk of the solution.

KRUGMAN: I don't see why not. Even if we raised it all through taxes - something I wouldn't support, by the way - the total tax take in America would go from roughly 27 percent of GDP, including state and local, up to 35 percent. In many advanced countries, the take is close to forty percent.

HUBBARD: That's about a fifty percent increase in federal taxes. You ought to know that.

KRUGMAN: That's what I just said. The federal government takes around seventeen percent of GDP now; a hike that big would take it up to 25 percent.

HUBBARD: That wouldn't strike you as a large departure in fiscal policy? The best estimates from the research suggest that tax increases of that size would reduce the economy's potential growth by as much as a percentage point. That is a huge hit to future standards of living.

KRUGMAN: I would dispute that. Look, Sweden is actually doing pretty decently these days - their economy grew at three percent last year, far more than Europe as a whole - despite a tax rate that nobody would consider having here. It does matter how the taxes are done: you can do a lot of damage to incentives with a poorly designed tax system, without even raising all that much money. But I don't believe that the size of the tax increase needed to sustain the welfare state is a crippling objection.

PETERSON: I suppose I'm a centrist on this subject -

HUBBARD: That's why you're at the center of the table.

PETERSON: - because I take issue with the supply-side wing of the Republican Party, which asks one to believe that any increase in marginal tax rates results in very serious problems. Well, Bill Clinton raised marginal tax rates, and the net effect was still positive, because the raises were in the context of an overall package that was fiscally responsible. So I wouldn't say that any tax increase is out of the question. We may well have to have some tax increases. But trying to solve most of the entitlement problems with tax increases is, I think, doubtful.

HUBBARD: Our political system would not likely tolerate tax increases of that size, and I think it's naive to suggest them as the major part of the solution.

KRUGMAN: I agree that it's not going to happen. None of this is going to happen.

PETERSON: Paul, I don't hear you saying much about what you would do on the benefit-reduction side. What about Social Security?

KRUGMAN: I think we tinker at the edges with the benefits. Early retirement is a big cost. I think that if we make some adjustments, we can probably reduce the path of benefits, depress it a little bit from what it is on the current trajectory. I think that if you do that, and you can control the medical costs, which are huge, then the balance can in effect be covered by tax increases. To do anything more drastic, such as switch the system to price indexing - that is, link benefit levels to growth in prices rather than wages, which grow more quickly - it would turn Social Security into just a poverty program.

PETERSON: What do you mean it would become a poverty program? People would have the same real benefits, even after inflation.

KRUGMAN: Think about what society would be like if we had had price indexing since 1950. The elderly today would be expected to make do on a standard of living comparable to the one we had in place when a third of US households didn't have indoor plumbing.

HUBBARD: Here is what I don't understand. Moving to price indexing - and then shoring up benefits for lower-income people - would force the burden of the adjustment on high-income people without diminishing Social Security's role as a safety net. Presumably you would agree with that goal. And yet you reflexively gravitate toward raising taxes to fund the size of the existing system. Why do you want to restore fiscal balance by maintaining a large government share? Why not just reduce subsidies at the high end, which would encourage wealthier individuals to save more on their own?

KRUGMAN: Switching to price indexing would not make a bit of difference to high-income people. We're talking about middle-income people. It would mean a gradual suffocating of middle-class and ordinary working people's Social Security program.

HUBBARD: But your plan would require raising taxes on those same people.

KRUGMAN: I believe in the social-insurance paradigm. Europe clearly has too much of it - in Germany, for example, I think they have to cut benefits. But I don't think that the United States should be substantially reducing the current amount of social insurance we provide. To make just Social Security good for seventy-five years would take only about a five percent increase in federal taxes.

PETERSON: But, then, I don't see how you fix Medicare. That fiscal problem is much, much larger, and the political and ethical issues are much more daunting. Medicare really is the elephant in the boudoir - everybody is hoping no one else is rude enough to mention it. There is endless talk by the President on the unfunded liabilities of Social Security, which in the indefinite future are about $10.5 trillion. For Medicare, they're $61.6 trillion.

HUBBARD: The problem is rising relative prices of health care; compared to other goods and services, health care is becoming more expensive.

KRUGMAN: It's also the widening range of what medicine can do - not just for the elderly but for everybody - that makes it more expensive. Health care was pretty cheap back when heart disease was mostly untreatable. Now we have drugs, surgeries. In 1984 the average treatment for a heart attack cost $12,000 in today's dollars; by 1998 it was $22,000. We have an ever-larger number of treatable conditions.

HUBBARD: Which is why Medicare is far more difficult to repair than Social Security. Medicare is a budget problem, but it also concerns societal values, and defining the state's role in determining who gets access to all the available health- care services.

KRUGMAN: Having your mother's Social Security check cut by five percent is going to raise far fewer howls than having her turned down for a triple bypass.

PETERSON: Paul, you say we should fix Social Security by raising taxes, but what would you propose for Medicare?

KRUGMAN: Primarily I want to see us move to a rational health-care system.

LAPHAM: By rational you mean what? Single payer? Everything paid for by the government?

KRUGMAN: Single payer, with probably a fair bit of actual government intervention. I think that on this question we have put on ideological blinders. We're incapable of seeing that the solution is not markets. All indications are that health care is in fact a part of the economy in which markets do not work well. The way to go is to take a lot of it out ofthe market. Of course, this idea is so unacceptable in our current ideological climate that we are probably incapable of having a rational debate on health care.

HUBBARD: I don't know about the ideological climate. I just disagree with the proposition as a matter of economics. In fact, along with two co-authors, John Cogan and Daniel Kessler, I've just finished a book that makes precisely the opposite point: the real problem with health-care markets is that they haven't been allowed to function properly. Five out of every six dollars spent on health care today are paid by third-party insurers, which means that doctors and patients can decide on expensive care while bearing almost none of the immediate cost. The patients, of course, bear the cost in the long run, because high insurance premiums become a drag on their wages. If we really allowed market forces to work - by, for example, reforming tax policy, which right now penalizes Americans for purchasing health care and health insurance on their own - then consumers would incorporate more of the true costs into their decision-making.

KRUGMAN: I'm not an antimarket guy at all, but I've reluctantly come to the conclusion that what we've got is the worst of both worlds. We have a system on which we spend enormous amounts of money trying not to cover people, because that's what private insurance companies do. Private health organizations do not have a sustained interest in the health of the people they treat.

HUBBARD: You want to trade the quality, and innovation, of US health care for the British health service?

KRUGMAN: No. The British spend way too little. But I think if we could trade for the French health-care system - a more or less publicly run system, but much better funded than the British system - I would do it in a heartbeat.

HUBBARD: I disagree. The United States is the innovator in treatment techniques, pharmaceutical development.

PETERSON: Whether or not we should trade for anyone else's system, there's the problem of how to get the American people to accept such a trade. Some people say, gee, let's have the Canadian system. But we have eighteen times more MRI units than the Canadians. Americans have gotten used to the idea that if any high-technology gadget exists, they are "entitled" to it. If you look at the global use of health care, you'll find that we use much, much more high-tech, high-cost stuff, including at the end of life: if you go into an intensive-care unit, you'll find all kinds of very expensive and heroic intervention techniques that other countries use far less of.

KRUGMAN: As the possibilities for medical care expand, and if you don't have public provision for everything that can be done, you're returning to a Victorian environment in which the children of the working class are four inches shorter than the children of the elite.

PETERSON: I do think it's important to look at what other countries do. Some other countries simply have spending limits on health care.

LAPHAM: Why isn't that sensible?

PETERSON: Let's be sure we understand what the implications are. Oregon in the late eighties was going broke with Medicaid. The state took an amazingly communitarian approach, appointing a panel of businesspeople and doctors and unions and churches that broke down health- care problems and prioritized them. As for lower-priority problems, the panel recommended, the state would cap the amount spent; after a point, funds would simply not be available for these lower priorities. Oregon sent this plan to the White House, and the first Bush Administration called it "rationing". To which the obvious response was, hello - of course it's rationing! What do we think we're talking about? You can use any word you wish, but somebody is going to have to give up some treatment, even if it may have some health benefit.

LAPHAM: Assuming that we can steer the federal budget through our demographic straits, we're still left with the problem of our overseas deficit, which hinges on Americans' failure to save. At any given point in time, more than seventy percent of the world's total savings is being lent to Americans, while our own savings rate - the amount by which our savings exceeds our spending and debt - is effectively zero.

HUBBARD: I don't hear any disagreement around this table on the need to raise national savings.

KRUGMAN: Where we disagree is on the urgency.

PETERSON: In the nineties, as part of a White House and congressional effort, I chaired a bipartisan committee on savings - half a dozen experts, left, right, and center. Much to my amazement they were unanimous, or virtually so, that the effects of voluntary tax incentives for savings - on 401(k)s, et cetera - were limited and ambiguous. How, then, did they propose to encourage savings? They, and I, think we have reached a point in this consumption-obsessed country where if we want people to save, we're going to have to make it mandatory. This, I know, is very controversial. We're going to have to do what Singapore and Chile and Australia did. The notion really offends some of my Republican friends, but I have come to the conclusion that if you want to increase personal savings, you're going to have to think seriously about such a program.

HUBBARD: It might surprise you, but I would agree: forced savings is the right answer. Personal accounts.

LAPHAM: Would that be a law?

KRUGMAN: Well, it would amount to a kind of tax. You'd be forced to put money into it.

HUBBARD: And the government could subsidize contributions for low-income people.

KRUGMAN: So we are saying that we can't close the budget deficit through tax increases but we're going to pass a forced-savings plan?

PETERSON: If you're going to save more, you're going to have to consume less.

KRUGMAN: Of course. My point is about the politics.

PETERSON: You can call it a tax if you wish, but I think there is a huge difference between writing a check to the government and letting it be spent on other people's consumption, and taking money and putting it in your own account. I call that real savings, not taxes. But if you put a word like "taxes" on a plan, it immediately would lose support.

KRUGMAN: Someone will put that word on it.

PETERSON: This is one reason why I'm not opposed to personal retirement accounts as part of Social Security. What I can't support is the idea to "fund" - I put that in big quotes - the accounts by borrowing trillions of dollars. If the administration would fund them, personal accounts would help to solve our savings problem. These really would be a genuine "lockbox", in that they would keep the money out of the hands of Congress.

HUBBARD: Exactly. And personal accounts could also serve as an example. The reason to fix Social Security first, I think, even though Medicare is by far the more important problem, is that Social Security reform would help set up a mechanism. Once we had Social Security personal accounts, and they were successful, we could use personal accounts to fund Medicare as well.


III. THE ICEBERG IS US

KRUGMAN: The real problem today is that we have political polarization and no middle ground. Major tax increases and major cuts in entitlement spending both appear to be politically impossible. We have the recipe for catastrophe.

LAPHAM: So the question becomes: Do we have the political will to avoid what we know to be certain doom? Pete wrote a book in 1996 entitled Will America Grow Up Before It Grows Old? The answer is: Apparently not. If I hear you gentlemen correctly, we're aboard the Titanic, but even if you three were in the crow's nest together, you'd be unable to agree on which way to steer. We don't seem to have a politics capable of reaching agreement on what is valuable.

PETERSON: We're somehow in a political system that is all gain and no pain, all get and no give. Anybody who suggests that we should give up something is immediately attacked. So first, the American people must be told a lot of hard truths so that they understand what the problem is.

HUBBARD: I'm more optimistic than that. If we reform our entitlements, and shore them up more as safety-net programs, then higher-income people - everybody around this table, for example - would get lower subsidies. But I suspect we all would support, very strongly, such subsidies for low-income households. That kind of compromise seems to me politically possible.

PETERSON: You don't hear much truth coming out of either party. We seem to have reached a point at which we can deal with a problem only when we're confronted with a palpable crisis. Anything that is long-term and silent, where there are no palpable symptoms, we ignore. We will have to raise taxes, or we will have to cut benefits, or both. But can you name one politician who is saying either of those things at this point? I'm not aware of any. We don't have a political system that really works.

HUBBARD: You can't have a debate over tax increases versus program reforms if we can't agree on the math. Some political leaders are actually saying we don't really have a serious budget problem with Social Security and Medicare - that nips and tucks will fix this. But that is simply not true. Paul, earlier you spoke of a crisis; but then you flip and say there is not much of a problem with entitlements.

KRUGMAN: No, I didn't flip. I believe that Social Security is a basically trivial irritation. There is a potential Social Security problem, but our truly large twenty-year fiscal problem is driven much more by medical costs than by demography. Meanwhile, there is an immediate budget deficit, which the Bush Administration has done its best to run up. Having rammed through an incredibly badly designed addition to the entitlements programs in 2003, the administration then said we had a crisis in Social Security and put forward a "fix" for this crisis that would, so far as we have any information on it, decrease the cash flow of the system for the next forty-five years. So how are we going to have a rational discussion here? It is true that Democrats are attacking the crisis language of the administration because it's applied to the wrong program and because it's being used as a cover for a "solution" that would actually make things worse.

HUBBARD: The Democrats would be happier to cut Medicare than Social Security?

KRUGMAN: Given what we think the President's plan is going to be, it actually doesn't even start to cut Social Security benefits significantly until a couple of decades out. It doesn't do anything for the entitlements problem in the next several decades.

HUBBARD: We do need to act quickly. The problem will only grow if we continue to delay. The current Congress should be able to work with President Bush to come up with an answer. If they don't, I would worry more about our long-term fiscal outlook and how the capital markets will respond to it.

PETERSON: The administration certainly hasn't made much progress during the last four years. It was the Republican Congress, remember, that got rid of the spending caps. They got rid of pay-as-you-go. Suddenly we had a big tax cut, and discretionary spending went up sharply. As a Republican it troubles me a lot.

KRUGMAN: Looking at it from the other side, it seems as if everything has been calculated to increase political dominance. Just look at the way the Social Security campaign has been conducted, with the closed events and the hand-picked audiences and the pseudo-citizen questioners. This has not been a serious attempt to solve the Social Security problem; it has been an attempt to sell a vision, a partisan vision, of what we should do to the system. This is a president who is not prepared to do any reaching out for true bipartisanship. You have a party that has achieved control of all three branches of government through a policy of demonizing people on the other side, no matter how much they tried to reach out.

HUBBARD: Like John Kerry? I didn't hear him trying to find much middle ground during last year's campaign.

KRUGMAN: No. Like Max Cleland. Like the other centrist Democrats who have been made into convenient targets of partisan opportunity. There is no room for compromise. I used to say until a few months ago that the country wasn't as polarized as Washington. I think that is still true, but we're getting there.

HUBBARD: I disagree. The American people, I think, are far more thoughtful and mature than their political leaders imagine.

KRUGMAN: That's true. But to solve our deficit problems, there would have to be a politician grown-up enough to sacrifice something.

Bill Totten http://www.ashisuto.co.jp/english/

Reducing Japan's Dependence on Oil

by Bill Totten

Nihonkai Shimbun and Osaka Nichinichi Shimbun (June 09 2005)

(I've written a weekly column for two Japanese newspapers for the past three years. My colleague, Patrick Heaton, translated this one from the Japanese original.)


As regular readers of this Weblog are aware, for some time I have been warning of the approaching end to the age of plentiful, cheap oil. I am now in the process of studying how to use organic agricultural methods in order to plant my own vegetable garden. My interest in this subject was stimulated by a book I read entitled 'One Straw Revolution' by Fukuoka Masanori. The book jolted me into reviewing my lifestyle and values. Mr Fukuoka has lived his entire life working at an agricultural experiment station involved with organic gardening. Because his books have been published in English and because he has received various awards, such as the Magsaisai Award from the Philippines and top honorary awards from India and other places, he is known not only in Japan but around the world.

His life has been very different from mine. Whereas I have been managing a computer software company while also trying to glean information from around the world via the Internet and thinking about the direction humans should take to live in harmony with the earth, Mr Fukuoka has actually been living in strict accordance with his natural lifestyle philosophy.

I have always believed that everyone has their own purpose, and that life is a matter of fulfilling one's individual destiny to the greatest degree possible. I do not think it is a coincidence that I began to become interested in environmental issues after learning of Mr Fukuoka's philosophy.

I have long realized that agriculture is an important issue, having understood it mainly from the point of view of the balance between self-sufficiency rates and populations, and the amount of oil used to maintain that balance. But when I read Mr Fukuoka's book, I realized anew that if people, including myself, live only by looking at efficiency and economics, we will only continue to contribute to the destruction of nature, thereby disrupting all natural
balances.

Many people today seem to believe that science is everything, and that only through scientific progress will the problems of food, energy, and environmental degradation facing humankind be solved. But if we seriously look at the real situation, we can see that modern 'scientific' methods of using artificial fertilizers and pesticides in agricuture are simply damaging the soil. When it rains, topsoil is eroded. Yet to maintain production levels, ever more artificial fertilizers have to be added to lands impoverished by previous practices, thus continuing the vicious cycle of destroying the balance of the ecological system. We who live in the industrialized world are now at a crossroads: To stop this destructive cycle, we all must re-evaluate the direction our civilization is headed, and as individuals we must thoroughly re-examine our lifestyles and our value systems.

When considering, however, what we can do toward this goal in our daily lives, we tend to think that none of us as individuals has power to change anything. This is because a class of people with money and influence, who gain great profits from the current economic and social systems, use extreme mind control.

For instance, regarding the theory of peak oil, a large amount of information has been appearing in the English-speaking world since I first began researching the subject about a year ago. But it seems very little information on this issue has been published in Japanese. Even when information does appear about the fact that market prices for petroleum products are at their highest levels in ten years, the cause is usually attributed to the Iraq war, or to the sudden increase in oil consumption by China and India. Little if any mention is made of the possibility that the production peak of oil in many oil-producing nations may be approaching, or may even have been passed. I wonder just why it is that the Japanese government and financial organizations do not say that the actual cause of the shortage is the reaching of peak production.

In English documents, even Goldman Sachs gives its customers information on the fact that we have definitely entered an era of a sudden jump in crude oil prices. When crude oil prices rise, not only do gasoline and heavy oil prices also go up, but all 500,000 products that are made from oil are also largely affected. It is clear that Goldman Sachs, which has a close relationship with the Bush administration, gives information to its customers on why the United States is trying militarily and politically to put both Iraq and Iran under American control. It is obvious the US has initiated these wars primarily to harness energy resources. Many innocent civilians have lost their lives in Afghanistan and throughout the Middle East because of these policies. I believe as the reality of peak oil becomes even more evident, it is possible we will see warfare in many other areas of the world.

Prime Minister Koizumi has obeyed US imperatives and has dispatched Japan's Self-Defence Forces to Iraq. But it is folly on Japan's part to believe the United States would share energy resources with Japan when those resources become scarce. Before oil supplies drastically decrease, what Japan, a country with no resources, should do is strive to tap Japanese technical knowledge and begin a movement toward a sustainable society that does not destroy the planet's ecological system. Individuals and the state should employ policies that reduce reliance on oil as much as possible.

As someone who manages a computer software company, I am beginning this effort on a personal level by starting my own vegetable garden. It is a modest effort but I hope someday many individuals and other organizations will be able to produce agricultural products through methods that do not destroy the environment, and can provide such products to their employees. It may sound only like a dream, but as a businessman looking at this issue from an international perspective, I believe this is the right track and that now is the time to begin efforts in this direction.


From Onko Chishin (Learning from the Past) column by Bill Totten in Nihonkai Shimbun and Osaka Nichinichi Shimbun (June 09 2005)

Japanese original is at http://www.nnn.co.jp/rondan/tisin/050609.html


Bill Totten http://www.ashisuto.co.jp/english/

Ecuador Gets Chavez'd

by Greg Palast

The Nation (May 11 2005 online issue)


George Bush has someone new to hate. Only twenty-four hours after Ecuador's new president took his oath of office, he was hit by a diplomatic cruise missile fired all the way from Lithuania by Condoleezza Rice, then wandering about Eastern Europe spreading "democracy". Condi called for "a constitutional process to get to elections", which came as a bit of a shock to the man who'd already been constitutionally elected, Alfredo Palacio.

What had Palacio done to get our Secretary of State's political knickers in a twist? It's the oil - and the bonds. This nation of only thirteen million souls at the world's belly button is rich, sitting on 4.4 billion barrels of known oil reserves, and probably much more. Yet sixty percent of its citizens live in brutal poverty; a lucky minority earn the "minimum" wage of $153 a month.

The obvious solution - give the oil money to the Ecuadoreans without money - runs smack up against Paragraph III-1 of the World Bank's 2003 Structural Adjustment Program Loan. The diktat is marked "FOR OFFICIAL USE ONLY", which "may not be disclosed" without World Bank authorization. TheNation.com has obtained a copy.

The secret loan terms require Ecuador to pay bondholders seventy percent of the revenue received from any spike in the price of oil. The result: Ecuador must give up the big bucks from the Iraq War oil price surge. Another twenty percent of the oil windfall is set aside for "contingencies" (that is, later payments to bondholders). The document specifies that Ecuador may keep only ten percent of new oil revenue for expenditures on social services.

I showed President Palacio the World Bank documents. He knew their terms well. "If we pay that amount of debt", he told me, "we're dead. We have to survive." He argued, with logic, "If we die, who is going to pay them?"

We met two weeks ago in the Carondelet Palace, where, on April 20, his predecessor had disappeared out the back door to seek asylum in Brazil. A crowd of 100,000 protesters had surrounded the building, seeking the arrest of fugitive president Lucio Gutierrez.

"Sucio Lucio" (Dirty Lucio, as the graffiti tags him) had won election in 2002 promising to break away from the supposedly voluntary austerity plan imposed by the World Bank. Then, within a month of taking office, Gutierrez flew to Washington. There he held hands with George Bush (a photo infamous in Quito), and US Treasury officials instructed him in the financial facts of life. Lucio returned to Quito, reneged on his campaign promises and tightened the austerity measures, including raising the price of cooking gas. The public, after a dispirited delay, revolted. After Lucio fled last month, the nation's congress recognized the vacancy in Ecuador's Oval Office and filled it with the elected vice president, in accordance with the Constitution.

Given the oil windfall, Palacio sees no need to follow Gutierrez's path to economic asphyxiation. "It is impossible that they condemn us not to have health, not to have education", he told me. He made it clear that handing over ninety percent of his nation's new oil wealth would not stand.

That's not what the Bush Administration wanted to hear. Besides Condi's attack, Palacio got the full "Chavez" treatment from the New York Times, which ran the headline "Ecuador's New Chief Picks Cabinet; Leftist in Economic Post" after Palacio's new finance minister announced Ecuador would put social-services programs first ahead of payments to bondholders. The Times said Palacio's views "ruffled some feathers" (whose, we don't know) and that foreign powers questioned the "legitimacy" of his right to office. Palacio smiled, "They don't say which ones".

Palacio seems an unlikely target of US official assaults. He comes off like a cardiologist you'd meet at an AMA convention. That is, in fact, what he is: a heart doctor who practiced in the United States for a decade, a man outside politics, affiliated with no party, brought in by Gutierrez to build a national health program. Hugo Chavez he is not: Palacio is conservative, pro-market, pro-American, but his patient, his nation, is in bad shape.

"Sick people are not going to produce anything", he said.

I knew he'd been taken aback by Rice's blast. Indeed, when an earlier president was removed in a coup, the United States had insisted on the vice president taking office. But, unlike Palacio, that vice president, Gustavo Noboa, was a rightist who was happy to sign off on all World Bank terms, including the devastating decision in January 2000 to make the US dollar Ecuador's official currency. The radical free-market dollarization plan led to collapse of the export market, decimation of payrolls and, for those still working, a halving of real wages.

Palacio told me he "received the explanation from Ms Condoleezza Rice", who reassured him she did not seek his removal. But reassurance apparently has a price. The morning we met, Palacio announced he would maintain US military bases in Ecuador (not a popular view) and would not object to Plan Colombia, the US war on guerrillas dressed as a war on drugs. As a physician, however, he did question chemical spraying of coca crops.

But on the oil money and bond payout he's holding his ground, and with good reason. When the oil market went bust in the 1980s, so did Ecuador, and its bonds sold at dimes on the dollar. Now Ecuador's debt sells at a full face value, yielding windfall profits to speculators of as much as 500 percent for those who bought cheap.

Palacio doesn't object to paying off the bonds. The problem is that the World Bank and IMF want the principal of the bonds paid down early, a rare and financially suspect demand to make on any nation.

Who are these guys who hold the bonds? "We don't know who they are, and that's terrible", the president told me. What's terrible, says a United Nations expert who cannot be named, is that Palacio does know who they are: the old oligarchs who originally stripped the nation's banks of assets in the 1980s, fled to Miami and now hold a mortgage on the nation. Palacio's plan to move some of the oil money to social services threatens these bondholders' windfall.

A closer look at the Structural Adjustment Program suggests that the World Bank may not be putting Ecuador's interests first. Paragraph III-2 requires electricity rates to rise to double the average price charged in the United States, far above production costs. This is quite a boon to the Ecuadorean electricity suppliers such as Noble Energy of Houston and Duke Power of the Carolinas.

Outside the presidential palace, indigenous women in bowler hats and pigtails chanted, "!Fuera todos! !Fuera todos!" Everyone out. As far as they are concerned, every one of the seven presidents who have entered office in the past nine years has sold them out to the bondholders, to the oil companies, to the World Bank and its austerity punishments. To them, Palacio is just another in a long line of disappointments.

I asked the president what he would do if the World Bank and the Bush Administration nix his request for Ecuador to keep an extra tiny percentage of its oil money. Mindful that no Ecuadorean president since 1996 has served out his term, Palacio told me simply: "There is no way. There is no other way. These people have to listen to us."

Greg Palast is the author of The Best Democracy Money Can Buy (Penguin).

http://www.thenation.com/doc.mhtml?i=20050530&s=palast


Bill Totten http://www.ashisuto.co.jp/english/

Imperialism 101

Chapter 1 of Against Empire (City Lights Books, 1995)

by Michael Parenti

Imperialism has been the most powerful force in world history over the last four or five centuries, carving up whole continents while oppressing indigenous peoples and obliterating entire civilizations. Yet, it is seldom accorded any serious attention by our academics, media commentators, and political leaders. When not ignored outright, the subject of imperialism has been sanitized, so that empires become "commonwealths", and colonies become "territories" or "dominions" (or, as in the case of Puerto Rico, "commonwealths" too). Imperialist military interventions become matters of "national defense", "national security", and maintaining "stability" in one or another region. In this book I want to look at imperialism for what it really is.


Across the Entire Globe

By "imperialism" I mean the process whereby the dominant politico-economic interests of one nation expropriate for their own enrichment the land, labor, raw materials, and markets of another people.

The earliest victims of Western European imperialism were other Europeans. Some 800 years ago, Ireland became the first colony of what later became known as the British empire. A part of Ireland still remains under British occupation. Other early Caucasian victims included the Eastern Europeans. The people Charlemagne worked to death in his mines in the early part of the ninth century were Slavs. So frequent and prolonged was the enslavement of Eastern Europeans that "Slav" became synonymous with servitude. Indeed, the word "slave" derives from "Slav". Eastern Europe was an early source of capital accumulation, having become wholly dependent upon Western manufactures by the seventeenth century.

A particularly pernicious example of intra-European imperialism was the Nazi aggression during World War II, which gave the German business cartels and the Nazi state an opportunity to plunder the resources and exploit the labor of occupied Europe, including the slave labor of concentration camps.

The preponderant thrust of the European, North American, and Japanese imperial powers has been directed against Africa, Asia, and Latin America. By the nineteenth century, they saw the Third World as not only a source of raw materials and slaves but a market for manufactured goods. By the twentieth century, the industrial nations were exporting not only goods but capital, in the form of machinery, technology, investments, and loans. To say that we have entered the stage of capital export and investment is not to imply that the plunder of natural resources has ceased. If anything, the despoliation has accelerated.

Of the various notions about imperialism circulating today in the United States, the dominant view is that it does not exist. Imperialism is not recognized as a legitimate concept, certainly not in regard to the United States. One may speak of "Soviet imperialism" or "nineteenth-century British imperialism" but not of US imperialism. A graduate student in political science at most universities in this country would not be granted the opportunity to research US imperialism, on the grounds that such an undertaking would not be scholarly. While many people throughout the world charge the United States with being an imperialist power, in this country persons who talk of US imperialism are usually judged to be mouthing ideological blather.


The Dynamic of Capital Expansion

Imperialism is older than capitalism. The Persian, Macedonian, Roman, and Mongol empires all existed centuries before the Rothschilds and Rockefellers. Emperors and conquistadors were interested mostly in plunder and tribute, gold and glory. Capitalist imperialism differs from these earlier forms in the way it systematically accumulates capital through the organized exploitation of labor and the penetration of overseas markets. Capitalist imperialism invests in other countries, transforming and dominating their economies, cultures, and political life, integrating their financial and productive structures into an international system of capital accumulation.

A central imperative of capitalism is expansion. Investors will not put their money into business ventures unless they can extract more than they invest. Increased earnings come only with a growth in the enterprise. The capitalist ceaselessly searches for ways of making more money in order to make still more money. One must always invest to realize profits, gathering as much strength as possible in the face of competing forces and unpredictable markets.

Given its expansionist nature, capitalism has little inclination to stay home. Almost 150 years ago, Marx and Engels described a bourgeoisie that "chases over the whole surface of the globe. It must nestle everywhere, settle everywhere, establish connections everywhere ... It creates a world after its own image". The expansionists destroy whole societies. Self-sufficient peoples are forcibly transformed into disfranchised wage workers. Indigenous communities and folk cultures are replaced by mass-market, mass-media, consumer societies. Cooperative lands are supplanted by agribusiness factory farms, villages by desolate shanty towns, autonomous regions by centralized autocracies.

Consider one of a thousand such instances. A few years ago the Los Angeles Times carried a special report on the rainforests of Borneo in the South Pacific. By their own testimony, the people there lived contented lives. They hunted, fished, and raised food in their jungle orchards and groves. But their entire way of life was ruthlessly wiped out by a few giant companies that destroyed the rainforest in order to harvest the hardwood for quick profits. Their lands were turned into ecological disaster areas and they themselves were transformed into disfranchised shantytown dwellers, forced to work for subsistence wages - when fortunate enough to find employment.

North American and European corporations have acquired control of more than three-fourths of the known mineral resources of Asia, Africa, and Latin America. But the pursuit of natural resources is not the only reason for capitalist overseas expansion. There is the additional need to cut production costs and maximize profits by investing in countries with cheaper labor markets. US corporate foreign investment grew 84 percent from 1985 to 1990, the most dramatic increase being in cheap-labor countries like South Korea, Taiwan, Spain, and Singapore.

Because of low wages, low taxes, nonexistent work benefits, weak labor unions, and nonexistent occupational and environmental protections, US corporate profit rates in the Third World are fifty percent greater than in developed countries. Citibank, one of the largest US firms, earns about 75 percent of its profits from overseas operations. While profit margins at home sometimes have had a sluggish growth, earnings abroad have continued to rise dramatically, fostering the development of what has become known as the multinational or transnational corporation. Today some four hundred transnational companies control about eighty percent of the capital assets of the global free market and are extending their grasp into the ex-communist countries of Eastern Europe.

Transnationals have developed a global production line. General Motors has factories that produce cars, trucks and a wide range of auto components in Canada, Brazil, Venezuela, Spain, Belgium, Yugoslavia, Nigeria, Singapore, Philippines, South Africa, South Korea and a dozen other countries. Such "multiple sourcing" enables GM to ride out strikes in one country by stepping up production in another, playing workers of various nations against each other in order to discourage wage and benefit demands and undermine labor union strategies.


Not Necessary, Just Compelling

Some writers question whether imperialism is a necessary condition for capitalism, pointing out that most Western capital is invested in Western nations, not in the Third World. If corporations lost all their Third World investments, they argue, many of them could still survive on their European and North American markets. In response, one should note that capitalism might be able to survive without imperialism - but it shows no inclination to do so. It manifests no desire to discard its enormously profitable Third World enterprises. Imperialism may not be a necessary condition for investor survival but it seems to be an inherent tendency and a natural outgrowth of advanced capitalism. Imperial relations may not be the only way to pursue profits, but they are the most lucrative way.

Whether imperialism is necessary for capitalism is really not the question. Many things that are not absolutely necessary are still highly desirable, therefore strongly preferred and vigorously pursued. Overseas investors find the Third World's cheap labor, vital natural resources, and various other highly profitable conditions to be compellingly attractive. Superprofits may not be necessary for capitalism's survival but survival is not all that capitalists are interested in. Superprofits are strongly preferred to more modest earnings. That there may be no necessity between capitalism and imperialism does not mean there is no compelling linkage.

The same is true of other social dynamics. For instance, wealth does not necessarily have to lead to luxurious living. A higher portion of an owning class's riches could be used for investment rather personal consumption. The very wealthy could survive on more modest sums but that is not how most of them prefer to live. Throughout history, wealthy classes generally have shown a preference for getting the best of everything. After all, the whole purpose of getting rich off other people's labor is to live well, avoiding all forms of thankless toil and drudgery, enjoying superior opportunities for lavish life-styles, medical care, education, travel, recreation, security, leisure, and opportunities for power and prestige. While none of these things are really "necessary", they are fervently clung to by those who possess them - as witnessed by the violent measures endorsed by advantaged classes whenever they feel the threat of an equalizing or leveling democratic force.


Myths of Underdevelopment

The impoverished lands of Asia, Africa, and Latin America are known to us as the "Third World", to distinguish them from the "First World" of industrialized Europe and North America and the now largely defunct "Second World" of communist states. Third World poverty, called "underdevelopment", is treated by most Western observers as an original historic condition. We are asked to believe that it always existed, that poor countries are poor because their lands have always been infertile or their people unproductive.

In fact, the lands of Asia, Africa, and Latin America have long produced great treasures of foods, minerals and other natural resources. That is why the Europeans went through all the trouble to steal and plunder them. One does not go to poor places for self-enrichment. The Third World is rich. Only its people are poor - and it is because of the pillage they have endured.

The process of expropriating the natural resources of the Third World began centuries ago and continues to this day. First, the colonizers extracted gold, silver, furs, silks, and spices, then flax, hemp, timber, molasses, sugar, rum, rubber, tobacco, calico, cocoa, coffee, cotton, copper, coal, palm oil, tin, iron, ivory, ebony, and later on, oil, zinc, manganese, mercury, platinum, cobalt, bauxite, aluminum, and uranium. Not to be overlooked is that most hellish of all expropriations: the abduction of millions of human beings into slave labor.

Through the centuries of colonization, many self-serving imperialist theories have been spun. I was taught in school that people in tropical lands are slothful and do not work as hard as we denizens of the temperate zone. In fact, the inhabitants of warm climates have performed remarkably productive feats, building magnificent civilizations well before Europe emerged from the Dark Ages. And today they often work long, hard hours for meager sums. Yet the early stereotype of the "lazy native" is still with us. In every capitalist society, the poor - both domestic and overseas - regularly are blamed for their own condition.

We hear that Third World peoples are culturally retarded in their attitudes, customs, and technical abilities. It is a convenient notion embraced by those who want to depict Western investments as a rescue operation designed to help backward peoples help themselves. This myth of "cultural backwardness" goes back to ancient times, when conquerors used it to justify enslaving indigenous peoples. It was used by European colonizers over the last five centuries for the same purpose.

What cultural supremacy could by claimed by the Europeans of yore? From the fifteenth to nineteenth centuries Europe was "ahead" in a variety of things, such as the number of hangings, murders, and other violent crimes; instances of venereal disease, smallpox, typhoid, tuberculosis, plagues, and other bodily afflictions; social inequality and poverty (both urban and rural); mistreatment of women and children; and frequency of famines, slavery, prostitution, piracy, religious massacres, and inquisitional torture. Those who claim the West has been the most advanced civilization should keep such "achievements" in mind.

More seriously, we might note that Europe enjoyed a telling advantage in navigation and armaments. Muskets and cannon, Gatling guns and gunboats, and today missiles, helicopter gunships, and fighter bombers have been the deciding factors when West meets East and North meets South. Superior firepower, not superior culture, has brought the Europeans and Euro-North Americans to positions of supremacy that today are still maintained by force, though not by force alone.

It was said that colonized peoples were biologically backward and less evolved than their colonizers. Their "savagery" and "lower" level of cultural evolution were emblematic of their inferior genetic evolution. But were they culturally inferior? In many parts of what is now considered the Third World, people developed impressive skills in architecture, horticulture, crafts, hunting, fishing, midwifery, medicine, and other such things. Their social customs were often far more gracious and humane and less autocratic and repressive than anything found in Europe at that time. Of course we must not romanticize these indigenous societies, some of which had a number of cruel and unusual practices of their own. But generally, their peoples enjoyed healthier, happier lives, with more leisure time, than did most of Europe's inhabitants.

Other theories enjoy wide currency. We hear that Third World poverty is due to overpopulation, too many people having too many children to feed. Actually, over the last several centuries, many Third World lands have been less densely populated than certain parts of Europe. India has fewer people per acre - but more poverty - than Holland, Wales, England, Japan, Italy, and a few other industrial countries. Furthermore, it is the industrialized nations of the First World, not the poor ones of the Third, that devour some eighty percent of the world's resources and pose the greatest threat to the planet's ecology.

This is not to deny that overpopulation is a real problem for the planet's ecosphere. Limiting population growth in all nations would help the global environment but it would not solve the problems of the poor - because overpopulation in itself is not the cause of poverty but one of its effects. The poor tend to have large families because children are a source of family labor and income and a support during old age.

Frances Moore Lappe and Rachel Schurman found that of seventy Third World countries, there were six - China, Sri Lanka, Colombia, Chile, Burma, and Cuba - and the state of Kerala in India that had managed to lower their birth rates by one third. They enjoyed neither dramatic industrial expansion nor high per capita incomes nor extensive family planning programs. The factors they had in common were public education and health care, a reduction of economic inequality, improvements in women's rights, food subsidies, and in some cases land reform. In other words, fertility rates were lowered not by capitalist investments and economic growth as such but by socio-economic betterment, even of a modest scale, accompanied by the emergence of women's rights.


Artificially Converted to Poverty

What is called "underdevelopment" is a set of social relations that has been forcefully imposed on countries. With the advent of the Western colonizers, the peoples of the Third World were actually set back in their development sometimes for centuries. British imperialism in India provides an instructive example. In 1810, India was exporting more textiles to England than England was exporting to India. By 1830, the trade flow was reversed. The British had put up prohibitive tariff barriers to shut out Indian finished goods and were dumping their commodities in India, a practice backed by British gunboats and military force. Within a matter of years, the great textile centers of Dacca and Madras were turned into ghost towns. The Indians were sent back to the land to raise the cotton used in British textile factories. In effect, India was reduced to being a cow milked by British financiers.

By 1850, India's debt had grown to 53 million pounds. From 1850 to 1900, its per capita income dropped by almost two-thirds. The value of the raw materials and commodities the Indians were obliged to send to Britain during most of the nineteenth century amounted yearly to more than the total income of the sixty million Indian agricultural and industrial workers. The massive poverty we associate with India was not that country's original historical condition. British imperialism did two things: first, it ended India's development, then it forcibly underdeveloped that country.

Similar bleeding processes occurred throughout the Third World. The enormous wealth extracted should remind us that there originally were few really poor nations. Countries like Brazil, Indonesia, Chile, Bolivia, Zaire, Mexico, Malaysia, and the Philippines were and sometimes still are rich in resources. Some lands have been so thoroughly plundered as to be desolate in all respects. However, most of the Third World is not "underdeveloped" but overexploited. Western colonization and investments have created a lower rather than a higher living standard.

Referring to what the English colonizers did to the Irish, Frederick Engels wrote in 1856: "How often have the Irish started out to achieve something, and every time they have been crushed politically and industrially. By consistent oppression they have been artificially converted into an utterly impoverished nation." So with most of the Third World. The Mayan Indians in Guatemala had a more nutritious and varied diet and better conditions of health in the early 16th century before the Europeans arrived than they have today. They had more craftspeople, architects, artisans, and horticulturists than today. What is called underdevelopment is not an original historical condition but a product of imperialism's superexploitation. Underdevelopment is itself a development.

Imperialism has created what I have termed "maldevelopment": modern office buildings and luxury hotels in the capital city instead of housing for the poor, cosmetic surgery clinics for the affluent instead of hospitals for workers, cash export crops for agribusiness instead of food for local markets, highways that go from the mines and latifundios to the refineries and ports instead of roads in the back country for those who might hope to see a doctor or a teacher.

Wealth is transferred from Third World peoples to the economic elites of Europe and North America (and more recently Japan) by direct plunder, by the expropriation of natural resources, the imposition of ruinous taxes and land rents, the payment of poverty wages, and the forced importation of finished goods at highly inflated prices. The colonized country is denied the freedom of trade and the opportunity to develop its own natural resources, markets, and industrial capacity. Self-sustenance and self-employment gives way to wage labor. From 1970 to 1980, the number of wage workers in the Third World grew from 72 million to 120 million, and the rate is accelerating.

Hundreds of millions of Third World peoples now live in destitution in remote villages and congested urban slums, suffering hunger, disease, and illiteracy, often because the land they once tilled is now controlled by agribusiness firms who use it for mining or for commercial export crops such as coffee, sugar, and beef, instead of growing beans, rice, and corn for home consumption. A study of twenty of the poorest countries, compiled from official statistics, found that the number of people living in what is called "absolute poverty" or rockbottom destitution, the poorest of the poor, is rising 70,000 a day and should reach 1.5 billion by the year 2000 (San Francisco Examiner, June 8 1994).

Imperialism forces millions of children around the world to live nightmarish lives, their mental and physical health severely damaged by endless exploitation. A documentary film on the Discovery Channel (April 24 1994) reported that in countries like Russia, Thailand, and the Philippines, large numbers of minors are sold into prostitution to help their desperate families survive. In countries like Mexico, India, Colombia, and Egypt, children are dragooned into health-shattering, dawn-to-dusk labor on farms and in factories and mines for pennies an hour, with no opportunity for play, schooling, or medical care.

In India, 55 million children are pressed into the work force. Tens of thousands labor in glass factories in temperatures as high as 100 degrees. In one plant, four-year-olds toil from 5 o'clock in the morning until the dead of night, inhaling fumes and contracting emphysema, tuberculosis, and other respiratory diseases. In the Philippines and Malaysia corporations have lobbied to drop age restrictions for labor recruitment. The pursuit of profit becomes a pursuit of evil.


Development Theory

When we say a country is "underdeveloped", we are implying that it is backward and retarded in some way, that its people have shown little capacity to achieve and evolve. The negative connotations of "underdeveloped" has caused the United Nations, the Wall Street Journal, and parties of various political persuasion to refer to Third World countries as "developing" nations, a term somewhat less insulting than "underdeveloped" but equally misleading. I prefer to use "Third World" because "developing" seems to be just a euphemistic way of saying "underdeveloped but belatedly starting to do something about it". It still implies that poverty was an original historic condition and not something imposed by the imperialists. It also falsely suggests that these countries are developing when actually their economic conditions are usually worsening.

The dominant theory of the last half century, enunciated repeatedly by writers like Barbara Ward and W W Rostow and afforded wide currency in the United States and other parts of the Western world, maintains that it is up to the rich nations of the North to help uplift the "backward" nations of the South, bringing them technology and teaching them proper work habits. This is an updated version of "the White man's burden", a favorite imperialist fantasy.

According to the development scenario, with the introduction of Western investments, the backward economic sectors of the poor nations will release their workers, who then will find more productive employment in the modern sector at higher wages. As capital accumulates, business will reinvest its profits, thus creating still more products, jobs, buying power, and markets. Eventually a more prosperous economy evolves.

This "development theory" or "modernization theory", as it is sometimes called, bears little relation to reality. What has emerged in the Third World is an intensely exploitive form of dependent capitalism. Economic conditions have worsened drastically with the growth of transnational corporate investment. The problem is not poor lands or unproductive populations but foreign exploitation and class inequality. Investors go into a country not to uplift it but to enrich themselves.

People in these countries do not need to be taught how to farm. They need the land and the implements to farm. They do not need to be taught how to fish. They need the boats and the nets and access to shore frontage, bays, and oceans. They need industrial plants to cease dumping toxic effusions into the waters. They do not need to be convinced that they should use hygienic standards. They do not need a Peace Corps Volunteer to tell them to boil their water, especially when they cannot afford fuel or have no access to firewood. They need the conditions that will allow them to have clean drinking water and clean clothes and homes. They do not need advice about balanced diets from North Americans. They usually know what foods best serve their nutritional requirements. They need to be given back their land and labor so that they might work for themselves and grow food for their own consumption.

The legacy of imperial domination is not only misery and strife, but an economic structure dominated by a network of international corporations which themselves are beholden to parent companies based in North America, Europe and Japan. If there is any harmonization or integration, it occurs among the global investor classes, not among the indigenous economies of these countries. Third World economies remain fragmented and unintegrated both between each other and within themselves, both in the flow of capital and goods and in technology and organization. In sum, what we have is a world economy that has little to do with the economic needs of the world's people.


Neoimperialism: Skimming the Cream

Sometimes imperial domination is explained as arising from an innate desire for domination and expansion, a "territorial imperative". In fact, territorial imperialism is no longer the prevailing mode. Compared to the nineteenth and early twentieth centuries, when the European powers carved up the world among themselves, today there is almost no colonial dominion left. Colonel Blimp is dead and buried, replaced by men in business suits. Rather than being directly colonized by the imperial power, the weaker countries have been granted the trappings of sovereignty - while Western finance capital retains control of the lion's share of their profitable resources. This relationship has gone under various names: "informal empire", "colonialism without colonies", "neocolonialism", and "neoimperialism".

US political and business leaders were among the earliest practitioners of this new kind of empire, most notably in Cuba at the beginning of the twentieth century. Having forcibly wrested the island from Spain in the war of 1898, they eventually gave Cuba its formal independence. The Cubans now had their own government, constitution, flag, currency, and security force. But major foreign policy decisions remained in US hands as did the island's wealth, including its sugar, tobacco, and tourist industries, and major imports and exports.

Historically US capitalist interests have been less interested in acquiring more colonies than in acquiring more wealth, preferring to make off with the treasure of other nations without bothering to own and administer the nations themselves. Under neoimperialism, the flag stays home, while the dollar goes everywhere - frequently assisted by the sword.

After World War II, European powers like Britain and France adopted a strategy of neoimperialism. Left financially depleted by years of warfare, and facing intensified popular resistance from within the Third World itself, they reluctantly decided that indirect economic hegemony was less costly and politically more expedient than outright colonial rule. They discovered that the removal of a conspicuously intrusive colonial rule made it more difficult for nationalist elements within the previously colonized countries to mobilize anti-imperialist sentiments.

Though the newly established government might be far from completely independent, it usually enjoyed more legitimacy in the eyes of its populace than a colonial administration controlled by the imperial power. Furthermore, under neoimperialism the native government takes up the costs of administering the country while the imperialist interests are free to concentrate on accumulating capital - which is all they really want to do.

After years of colonialism, the Third World country finds it extremely difficult to extricate itself from the unequal relationship with its former colonizer and impossible to depart from the global capitalist sphere. Those countries that try to make a break are subjected to punishing economic and military treatment by one or another major power, nowadays usually the United States.

The leaders of the new nations may voice revolutionary slogans, yet they find themselves locked into the global capitalist orbit, cooperating perforce with the First World nations for investment, trade, and aid. So we witnessed the curious phenomenon of leaders of newly independent Third World nations denouncing imperialism as the source of their countries' ills, while dissidents in these countries denounced these same leaders as collaborators of imperialism.

In many instances a comprador class emerged or was installed as a first condition for independence. A comprador class is one that cooperates in turning its own country into a client state for foreign interests. A client state is one that is open to investments on terms that are decidedly favorable to the foreign investors. In a client state, corporate investors enjoy direct subsidies and land grants, access to raw materials and cheap labor, light or nonexistent taxes, few effective labor unions, no minimum wage or child labor or occupational safety laws, and no consumer or environmental protections to speak of. The protective laws that do exist go largely unenforced.

In all, the Third World is something of a capitalist paradise, offering life as it was in Europe and the United States during the nineteenth century, with a rate of profit vastly higher than what might be earned today in a country with strong economic regulations. The comprador class is well recompensed for its cooperation. Its leaders enjoy opportunities to line their pockets with the foreign aid sent by the US government. Stability is assured with the establishment of security forces, armed and trained by the United States in the latest technologies of terror and repression. Still, neoimperialism carries risks. The achievement of de jure independence eventually fosters expectations of de facto independence. The forms of self rule incite a desire for the fruits of self rule. Sometimes a national leader emerges who is a patriot and reformer rather than a comprador collaborator. Therefore, the changeover from colonialism to neocolonialism is not without risks for the imperialists and represents a net gain for popular forces in the world.

Copyright 1992 - 2005 Michael Parenti. All rights reserved.

http://www.michaelparenti.org/Imperialism101.html

Bill Totten http://www.ashisuto.co.jp/english/

The Rise of Disaster Capitalism

by Naomi Klein

The Nation (May 02 2005 issue)


Last summer, in the lull of the August media doze, the Bush Administration's doctrine of preventive war took a major leap forward. On August 5 2004, the White House created the Office of the Coordinator for Reconstruction and Stabilization, headed by former US Ambassador to Ukraine Carlos Pascual. Its mandate is to draw up elaborate "post-conflict" plans for up to twenty-five countries that are not, as of yet, in conflict. According to Pascual, it will also be able to coordinate three full-scale reconstruction operations in different countries "at the same time", each lasting "five to seven years".

Fittingly, a government devoted to perpetual pre-emptive deconstruction now has a standing office of perpetual pre-emptive reconstruction.

Gone are the days of waiting for wars to break out and then drawing up ad hoc plans to pick up the pieces. In close cooperation with the National Intelligence Council, Pascual's office keeps "high risk" countries on a "watch list" and assembles rapid-response teams ready to engage in prewar planning and to "mobilize and deploy quickly" after a conflict has gone down. The teams are made up of private companies, nongovernmental organizations and members of think tanks - some, Pascual told an audience at the Center for Strategic and International Studies in October, will have "pre-completed" contracts to rebuild countries that are not yet broken. Doing this paperwork in advance could "cut off three to six months in your response time".

The plans Pascual's teams have been drawing up in his little-known office in the State Department are about changing "the very social fabric of a nation", he told CSIS. The office's mandate is not to rebuild any old states, you see, but to create "democratic and market-oriented" ones. So, for instance (and he was just pulling this example out of his hat, no doubt), his fast-acting reconstructors might help sell off "state-owned enterprises that created a nonviable economy". Sometimes rebuilding, he explained, means "tearing apart the old".

Few ideologues can resist the allure of a blank slate - that was colonialism's seductive promise: "discovering" wide-open new lands where utopia seemed possible. But colonialism is dead, or so we are told; there are no new places to discover, no terra nullius (there never was), no more blank pages on which, as Mao once said, "the newest and most beautiful words can be written". There is, however, plenty of destruction - countries smashed to rubble, whether by so-called Acts of God or by Acts of Bush (on orders from God). And where there is destruction there is reconstruction, a chance to grab hold of "the terrible barrenness", as a UN official recently described the devastation in Aceh, and fill it with the most perfect, beautiful plans.

"We used to have vulgar colonialism", says Shalmali Guttal, a Bangalore-based researcher with Focus on the Global South. "Now we have sophisticated colonialism, and they call it 'reconstruction'".

It certainly seems that ever-larger portions of the globe are under active reconstruction: being rebuilt by a parallel government made up of a familiar cast of for-profit consulting firms, engineering companies, mega-NGOs, government and UN aid agencies and international financial institutions. And from the people living in these reconstruction sites - Iraq to Aceh, Afghanistan to Haiti - a similar chorus of complaints can be heard. The work is far too slow, if it is happening at all. Foreign consultants live high on cost-plus expense accounts and thousand-dollar-a-day salaries, while locals are shut out of much-needed jobs, training and decision-making. Expert "democracy builders" lecture governments on the importance of transparency and "good governance", yet most contractors and NGOs refuse to open their books to those same governments, let alone give them control over how their aid money is spent.

Three months after the tsunami hit Aceh, the New York Times ran a distressing story reporting that "almost nothing seems to have been done to begin repairs and rebuilding". The dispatch could easily have come from Iraq, where, as the Los Angeles Times just reported, all of Bechtel's allegedly rebuilt water plants have started to break down, one more in an endless litany of reconstruction screw-ups.

It could also have come from Afghanistan, where President Hamid Karzai recently blasted "corrupt, wasteful and unaccountable" foreign contractors for "squandering the precious resources that Afghanistan received in aid". Or from Sri Lanka, where 600,000 people who lost their homes in the tsunami are still languishing in temporary camps. One hundred days after the giant waves hit, Herman Kumara, head of the National Fisheries Solidarity Movement in Negombo, Sri Lanka, sent out a desperate e-mail to colleagues around the world. "The funds received for the benefit of the victims are directed to the benefit of the privileged few, not to the real victims", he wrote. "Our voices are not heard and not allowed to be voiced".

But if the reconstruction industry is stunningly inept at rebuilding, that may be because rebuilding is not its primary purpose. According to Guttal, "It's not reconstruction at all - it's about reshaping everything". If anything, the stories of corruption and incompetence serve to mask this deeper scandal: the rise of a predatory form of disaster capitalism that uses the desperation and fear created by catastrophe to engage in radical social and economic engineering. And on this front, the reconstruction industry works so quickly and efficiently that the privatizations and land grabs are usually locked in before the local population knows what hit them. Kumara, in another e-mail, warns that Sri Lanka is now facing "a second tsunami of corporate globalization and militarization", potentially even more devastating than the first. "We see this as a plan of action amidst the tsunami crisis to hand over the sea and the coast to foreign corporations and tourism, with military assistance from the US Marines".

As Deputy Defense Secretary, Paul Wolfowitz designed and oversaw a strikingly similar project in Iraq: The fires were still burning in Baghdad when US occupation officials rewrote the investment laws and announced that the country's state-owned companies would be privatized. Some have pointed to this track record to argue that Wolfowitz is unfit to lead the World Bank; in fact, nothing could have prepared him better for his new job. In Iraq, Wolfowitz was just doing what the World Bank is already doing in virtually every war-torn and disaster-struck country in the world - albeit with fewer bureaucratic niceties and more ideological bravado.

"Post-conflict" countries now receive 20 to 25 percent of the World Bank's total lending, up from 16 percent in 1998 - itself an 800 percent increase since 1980, according to a Congressional Research Service study. Rapid response to wars and natural disasters has traditionally been the domain of United Nations agencies, which worked with NGOs to provide emergency aid, build temporary housing and the like. But now reconstruction work has been revealed as a tremendously lucrative industry, too important to be left to the do-gooders at the UN. So today it is the World Bank, already devoted to the principle of poverty-alleviation through profit-making, that leads the charge.

And there is no doubt that there are profits to be made in the reconstruction business. There are massive engineering and supplies contracts ($10 billion to Halliburton in Iraq and Afghanistan alone); "democracy building" has exploded into a $2 billion industry; and times have never been better for public-sector consultants - the private firms that advise governments on selling off their assets, often running government services themselves as subcontractors. (Bearing Point, the favored of these firms in the United States, reported that the revenues for its "public services" division "had quadrupled in just five years", and the profits are huge: $342 million in 2002 - a profit margin of 35 percent.)

But shattered countries are attractive to the World Bank for another reason: They take orders well. After a cataclysmic event, governments will usually do whatever it takes to get aid dollars - even if it means racking up huge debts and agreeing to sweeping policy reforms. And with the local population struggling to find shelter and food, political organizing against privatization can seem like an unimaginable luxury.

Even better from the bank's perspective, many war-ravaged countries are in states of "limited sovereignty": They are considered too unstable and unskilled to manage the aid money pouring in, so it is often put in a trust fund managed by the World Bank. This is the case in East Timor, where the bank doles out money to the government as long as it shows it is spending responsibly. Apparently, this means slashing public-sector jobs (Timor's government is half the size it was under Indonesian occupation) but lavishing aid money on foreign consultants the bank insists the government hire (researcher Ben Moxham writes, "In one government department, a single international consultant earns in one month the same as his twenty Timorese colleagues earn together in an entire year").

In Afghanistan, where the World Bank also administers the country's aid through a trust fund, it has already managed to privatize healthcare by refusing to give funds to the Ministry of Health to build hospitals. Instead it funnels money directly to NGOs, which are running their own private health clinics on three-year contracts. It has also mandated "an increased role for the private sector" in the water system, telecommunications, oil, gas and mining and directed the government to "withdraw" from the electricity sector and leave it to "foreign private investors". These profound transformations of Afghan society were never debated or reported on, because few outside the bank know they took place: The changes were buried deep in a "technical annex" attached to a grant providing "emergency" aid to Afghanistan's war-torn infrastructure - two years before the country had an elected government.

It has been much the same story in Haiti, following the ouster of President Jean-Bertrand Aristide. In exchange for a $61 million loan, the bank is requiring "public-private partnership and governance in the education and health sectors", according to bank documents - that is, private companies running schools and hospitals. Roger Noriega, US Assistant Secretary of State for Western Hemisphere Affairs, has made it clear that the Bush Administration shares these goals. "We will also encourage the government of Haiti to move forward, at the appropriate time, with restructuring and privatization of some public sector enterprises", he told the American Enterprise Institute on April 14 2004.

These are extraordinarily controversial plans in a country with a powerful socialist base, and the bank admits that this is precisely why it is pushing them now, with Haiti under what approaches military rule. "The Transitional Government provide[s] a window of opportunity for implementing economic governance reforms ... that may be hard for a future government to undo", the bank notes in its Economic Governance Reform Operation Project agreement. For Haitians, this is a particularly bitter irony: Many blame multilateral institutions, including the World Bank, for deepening the political crisis that led to Aristide's ouster by withholding hundreds of millions in promised loans. At the time, the Inter-American Development Bank, under pressure from the State Department, claimed Haiti was insufficiently democratic to receive the money, pointing to minor irregularities in a legislative election. But now that Aristide is out, the World Bank is openly celebrating the perks of operating in a democracy-free zone.

The World Bank and the International Monetary Fund have been imposing shock therapy on countries in various states of shock for at least three decades, most notably after Latin America's military coups and the collapse of the Soviet Union. Yet many observers say that today's disaster capitalism really hit its stride with Hurricane Mitch.

For a week in October 1998, Mitch parked itself over Central America, swallowing villages whole and killing more than 9,000. Already impoverished countries were desperate for reconstruction aid - and it came, but with strings attached. In the two months after Mitch struck, with the country still knee-deep in rubble, corpses and mud, the Honduran congress initiated what the Financial Times called "speed sell-offs after the storm". It passed laws allowing the privatization of airports, seaports and highways and fast-tracked plans to privatize the state telephone company, the national electric company and parts of the water sector. It overturned land-reform laws and made it easier for foreigners to buy and sell property. It was much the same in neighboring countries: In the same two months, Guatemala announced plans to sell off its phone system, and Nicaragua did likewise, along with its electric company and its petroleum sector.

All of the privatization plans were pushed aggressively by the usual suspects. According to the Wall Street Journal, "the World Bank and International Monetary Fund had thrown their weight behind the [telecom] sale, making it a condition for release of roughly $47 million in aid annually over three years and linking it to about $4.4 billion in foreign-debt relief for Nicaragua".

Now the bank is using the December 26 tsunami to push through its cookie-cutter policies. The most devastated countries have seen almost no debt relief, and most of the World Bank's emergency aid has come in the form of loans, not grants. Rather than emphasizing the need to help the small fishing communities - more than eighty percent of the wave's victims - the bank is pushing for expansion of the tourism sector and industrial fish farms. As for the damaged public infrastructure, like roads and schools, bank documents recognize that rebuilding them "may strain public finances" and suggest that governments consider privatization (yes, they have only one idea). "For certain investments", notes the bank's tsunami-response plan, "it may be appropriate to utilize private financing".

As in other reconstruction sites, from Haiti to Iraq, tsunami relief has little to do with recovering what was lost. Although hotels and industry have already started reconstructing on the coast, in Sri Lanka, Thailand, Indonesia and India, governments have passed laws preventing families from rebuilding their oceanfront homes. Hundreds of thousands of people are being forcibly relocated inland, to military style barracks in Aceh and prefab concrete boxes in Thailand. The coast is not being rebuilt as it was - dotted with fishing villages and beaches strewn with handmade nets. Instead, governments, corporations and foreign donors are teaming up to rebuild it as they would like it to be: the beaches as playgrounds for tourists, the oceans as watery mines for corporate fishing fleets, both serviced by privatized airports and highways built on borrowed money.

In January Condoleezza Rice sparked a small controversy by describing the tsunami as "a wonderful opportunity" that "has paid great dividends for us". Many were horrified at the idea of treating a massive human tragedy as a chance to seek advantage. But, if anything, Rice was understating the case. A group calling itself Thailand Tsunami Survivors and Supporters says that for "businessmen-politicians, the tsunami was the answer to their prayers, since it literally wiped these coastal areas clean of the communities which had previously stood in the way of their plans for resorts, hotels, casinos and shrimp farms. To them, all these coastal areas are now open land!"

Disaster, it seems, is the new terra nullius.

http://www.thenation.com/doc.mhtml?i=20050502&s=klein

Bill Totten http://www.ashisuto.co.jp/english/

A noose, not a bracelet

Africa is a rich continent made poor by rapacious western corporations. G8 leaders must be forced to deliver justice.

by Naomi Klein

The Guardian (June 10 2005)


Gordon Brown has a new idea about how to "make poverty history" in time for the G8 summit. With Washington so far refusing to double its aid to Africa by 2015, the chancellor is appealing to the "richer oil-producing states" of the Middle East to fill the funding gap. "Oil wealth urged to save Africa", reads the headline in the Observer.

Here is a better idea: instead of Saudi Arabia's oil wealth being used to "save Africa", how about if Africa's oil wealth was used to save Africa - along with its gas, diamond, gold, platinum, chromium, ferroalloy and coal wealth?

With all this noblesse oblige focused on saving Africa from its misery, it seems like a good time to remember someone else who tried to make poverty history: Ken Saro-Wiwa, who was killed ten years ago this November by the Nigerian government - along with eight other Ogoni activists, he was sentenced to death by hanging. Their crime was daring to insist that Nigeria was not poor at all but rich, and that political decisions made in the interests of western multinational corporations kept its people in desperate poverty. Saro-Wiwa gave his life to the idea that the vast oil wealth of the Niger delta must leave behind more than polluted rivers, charred farmland, rancid air and crumbling schools. He asked not for charity, pity or "relief", but for justice.

The Movement for the Survival of the Ogoni People demanded that Shell compensate the people from whose land it had pumped roughly $30 billion worth of oil since the 1950s. The company turned to the government for help, and the Nigerian military turned its guns on demonstrators. Before his state-ordered hanging, Saro-Wiwa told the tribunal: "I and my colleagues are not the only ones on trial. Shell is here on trial ... The company has, indeed, ducked this particular trial, but its day will surely come."

Ten years later, seventy percent of Nigerians still live on less than $1 a day and Shell is still making superprofits. Equatorial Guinea, which has a major oil deal with ExxonMobil, "got to keep a mere twelve percent of the oil revenues in the first year of its contract", according to a report on the CBS news programme Sixty Minutes - a share so low it would have been scandalous even at the height of colonial oil pillage.

This is what keeps Africa poor: not a lack of political will but the tremendous profitability of the current arrangement. Sub-Saharan Africa, the poorest place on earth, is also its most profitable investment destination. It offers, according to the World Bank's 2003 Global Development Finance report, "the highest returns on foreign direct investment of any region in the world". Africa is poor because its investors and its creditors are so unspeakably rich.

The idea for which Saro-Wiwa died fighting - that the resources of the land should be used to benefit the people of that land - lies at the heart of every anti-colonial struggle in history, from the Boston Tea Party to Iran's turfing out of the Anglo-Iranian Oil Company in Abadan. This idea has been declared dead by the EU's constitution, by the national security strategy of the US (which describes "free trade" not only as an economic policy but a "moral principle") and by countless trade agreements. And yet it simply refuses to die.

You can see it most clearly in the relentless protests that drove Bolivia's president, Carlos Mesa, to offer his resignation. A decade ago, Bolivia was forced by the IMF to privatise its oil and gas industries on the promise that it would increase growth and spread prosperity. When that didn't work, the lenders demanded that Bolivia make up its budget shortfall by increasing taxes on the working poor.

Bolivians had a better idea - take back the gas and use it for the benefit of the country. The debate now is over how much to take back. Evo Morales's Movement Toward Socialism favours taxing foreign profits by fifty percent. More radical indigenous groups, which have already seen their land stripped of its mineral wealth, want full nationalisation and more participation - what they call "nationalising the government".

You can see it too in Iraq. On June 2 Laith Kubba, spokesman for the Iraqi prime minister, told journalists that the IMF had forced Iraq to increase the price of electricity and fuel in exchange for writing off past debts: "Iraq has $10 billion of debts, and I think we cannot avoid this". But days before, in Basra, a historic gathering of independent trade unionists, most of them with the General Union of Oil Employees, insisted that the government could avoid it. At Iraq's first anti-privatisation conference, delegates demanded that the government simply refuse to pay Saddam's "odious" debts and opposed any attempts to privatise state assets, including oil.

Neoliberalism, an ideology so powerful it tries to pass itself off as "modernity" while its maniacal true believers masquerade as disinterested technocrats, can no longer claim to be a consensus. It was decisively rejected by French voters when they said no to the EU constitution, and you can see how hated it has become in Russia, where large majorities despise the profiteers of the disastrous 1990s privatisations and few mourned the recent sentencing of oil oligarch Mikhail Khodorkovsky.

All of this makes for interesting timing for the G8 summit. Bob Geldof and the Make Poverty History crew have called for a million people to go to Edinburgh and form a giant white band around the city centre on July 2 - a reference to the ubiquitous Make Poverty History bracelets.

But it seems a shame for a million people to travel all that way to be a giant bauble, a collective accessory to power. How about if, when all those people join hands, they declare themselves not a bracelet but a noose - a noose around the lethal economic policies that have already taken so many lives, for lack of medicine and clean water, for lack of justice.

A noose like the one that killed Ken.

http://www.guardian.co.uk/Columnists/Column/0,5673,1503527,00.html


Bill Totten http://www.ashisuto.co.jp/english/

Spin, Lies and Corruption

The G8's debt reduction plan is little better than an extortion racket

by George Monbiot

Published in the Guardian (June 14 2005)

An aura of sanctity is descending upon the world's most powerful men. On Saturday the finance ministers from seven of the G8 nations (Russia was not invited) promised to cancel the debts the poorest countries owe to the World Bank and the International Monetary Fund. The hand that holds the sword has been stayed by angels: angels with guitars rather than harps.

Who, apart from the leader writers of the Daily Telegraph, <1> could deny that debt relief is a good thing? Never mind that much of this debt - money lent by the World Bank and IMF to corrupt dictators - should never have been pursued in the first place. Never mind that, in terms of looted resources, stolen labour and now the damage caused by climate change, the rich owe the poor far more than the poor owe the rich. Some of the poorest countries have been paying more for debt than for health or education. Whatever the origins of the problem, that is obscene.

You are waiting for me to say but, and I will not disappoint you. The but comes in paragraph two of the finance ministers' statement. To qualify for debt relief, developing countries must "tackle corruption, boost private sector development" and eliminate "impediments to private investment, both domestic and foreign". <2>

These are called conditionalities. Conditionalities are the policies governments must follow before they receive aid and loans and debt relief. At first sight they look like a good idea. Corruption cripples poor nations, especially in Africa. The money which could have given everyone a reasonable standard of living has instead made a handful unbelievably rich. The powerful nations are justified in seeking to discourage it.

That's the theory. In truth, corruption has seldom been a barrier to foreign aid and loans: look at the money we have given, directly and through the World Bank and IMF, to Mobutu, Suharto, Marcos, Moi and every other premier-league crook. Robert Mugabe, the west's demon king, has deservedly been frozen out by the rich nations. But he has caused less suffering and is responsible for less corruption than Rwanda's Paul Kagame or Uganda's Yoweri Museveni, both of whom are repeatedly cited by the G8 countries as practitioners of "good governance". Their armies, as the UN has documented, are largely responsible for the meltdown in the eastern Democratic Republic of Congo (DRC), which has so far claimed four million lives, and have walked off with billions of dollars' worth of natural resources. <3> Yet the United Kingdom, which is hosting the G8 summit, remains their main bilateral funder. It has so far refused to make their withdrawal from the DRC a conditionality for foreign aid.

The difference, of course, is that Mugabe has not confined his attacks to black people; he has also dispossessed white farmers and confiscated foreign assets. Kagame, on the other hand, has eagerly supplied us with the materials we need for our mobile phones and computers: materials which his troops have stolen from the DRC. "Corrupt" is often used by our governments and newspapers to mean regimes that won't do what they're told.

Genuine corruption, on the other hand, is tolerated and even encouraged. Twenty-five countries have so far ratified the UN Convention Against Corruption, but none of them are members of the G8. <4> Why? Because our own corporations do very nicely out of it. In the UK companies can legally bribe the governments of Africa if they operate through our (profoundly corrupt) tax haven of Jersey. <5> Lord Falconer, the minister responsible for sorting this out, refuses to act. When you see the list of the island's clients, many of which sit in the FTSE-100 index, you begin to understand.

The idea swallowed by most commentators - that the conditions our governments impose help to prevent corruption - is laughable. To qualify for World Bank funding, our model client Uganda was forced to privatise most of its state-owned companies, before it had any means of regulating their sale. A sell-off which should have raised $500 million for the Ugandan exchequer instead raised $2 million. <6> The rest was nicked by government officials. Unchastened, the World Bank insisted that - to qualify for the debt relief programme the G8 has now extended - the Ugandan government sell off its water supplies, agricultural services and commercial bank, again with minimal regulation. <7>

And here we meet the real problem with the G8's conditionalities. They do not stop at pretending to prevent corruption, but intrude into every aspect of sovereign government. When the finance ministers say "good governance" and "eliminating impediments to private investment", what they mean is commercialisation, privatisation and the liberalisation of trade and capital flows. And what this means is new opportunities for western money.

Let's stick for a moment with Uganda. In the late 1980s, the IMF and World Bank forced it to impose "user fees" for basic healthcare and primary eduction. The purpose appears to have been to create new markets for private capital. School attendance, especially for girls, collapsed. So did health services, particularly for the rural poor. To stave off a possible revolution, Museveni reinstated free primary education in 1997 and free basic healthcare in 2001. Enrolment in primary school leapt from 2.5 million to 6 million, and the number of outpatients almost doubled. The World Bank and the IMF - which the G8 nations control - were furious. At the donors' meeting in April 2001, the head of the Bank's delegation made it clear that, as a result of the change in policy, he now saw the health ministry as a "bad investment". <8>

There is an obvious conflict of interest in this relationship. The G8 governments claim they want to help poor countries to develop and compete successfully. But they have a powerful commercial incentive to ensure that they compete unsuccessfully, and that our companies can grab their public services and obtain their commodities at rock bottom prices. The conditionalities we impose on the poor nations keep them on a short leash.

That's not the only conflict. The G8 finance ministers' statement insists that the World Bank and IMF will monitor the indebted countries' progress, and decide whether or not they are fit to be relieved of their burden. <9> The World Bank and IMF, of course, are the agencies which have the most to lose from this redemption. They have a vested interest in ensuring that debt relief takes place as slowly as possible.

Attaching conditions like these to aid is bad enough: it amounts to saying "we will give you a trickle of money if you give us the Crown Jewels". Attaching them to debt relief is in a different moral league: "we will stop punching you in the face if you give us the Crown Jewels". The G8's plan for saving Africa is little better than an extortion racket.

Do you still believe our newly-sanctified leaders have earned their halos? If so, you have swallowed a truckload of nonsense. Yes, they should cancel the debt. But they should cancel it unconditionally.

www.monbiot.com

References:

1. Leading article, 13th June 2005. That's enough debt relief.

2. G8 Finance Ministers, 10-11 June 2005. Conclusions on Development. http://www.hm-treasury.gov.uk/otherhmtsites/g7/news/communique_110605.cfm

3. United Nations Security Council, October 2002. Final report of the Panel of Experts on the Illegal Exploitation of Natural Resources and Other Forms of Wealth of the Democratic Republic of the Congo. UN, New York. See also: Amnesty International, 1st April 2003. Democratic Republic of the Congo: "Our brothers who help kill us" - economic exploitation and human rights abuses in the east. http://web.amnesty.org/library/Index/ENGAFR620102003;

Human Rights Watch, 4th December 2004. Democratic Republic of Congo - Rwanda Conflict.
http://www.hrw.org/english/docs/2004/12/04/congo9767.htm;

International Rescue Committee, December 2004. Mortality in the Democratic Republic of Congo: Results from a Nationwide Survey, Conducted April - July 2004.
http://www.theirc.org/pdf/DRC_MortalitySurvey2004_RB_8Dec04.pdf;

Global Witness, June 2004. Same Old Story - Natural Resources in the Democratic Republic of Congo. www.globalwitness.org/reports/download.php/00141.pdf;

The All Party Parliamentary Group on the Great Lakes Region and Genocide Prevention, November 2002. Cursed by Riches: Who Benefits from Resource Exploitation in the Democratic Republic of the Congo? http://www.appggreatlakes.org/content/pdf/riches.pdf;

Bureau of Democracy, Human Rights, and Labor, US State Department. 31st March 2003. Country Reports on Human Rights Practices, 2002. Rwanda. http://www.state.gov/g/drl/rls/hrrpt/2002/18221.htm


4. http://www.unodc.org/unodc/en/crime_signatures_corruption.html

5. David Leigh, 2nd June 2005. Jersey breaks promise to outlaw bribes. The Guardian.

6. Warren Nyamugasira and Rick Rowden, April 2002. New Strageies; Old Loan Conditions. Uganda National NGO Forum, Kampala. http://www.internationalbudget.org/resources/library/UgandaPRSP.pdf

7. ibid.

8. Report of the meeting by a health ministry official, cited in Warren Nyamugasira and Rick Rowden, ibid.

9. G8 Finance Ministers, 10-11 June 2005. G8 Proposals for HIPC debt cancellation. http://www.hm-treasury.gov.uk/otherhmtsites/g7/news/communique_110605.cfm


http://www.monbiot.com/archives/2005/06/14/spin-lies-and-corruption/


Bill Totten http://www.ashisuto.co.jp/english/

The Demonization of Slobodan Milosevic

by Michael Parenti

michaelparenti.org (December 2003)


US leaders profess a dedication to democracy. Yet over the past five decades, democratically elected governments - guilty of introducing redistributive economic programs or otherwise pursuing independent courses that do not properly fit into the US-sponsored global free market system - have found themselves targeted by the US national security state. Thus democratic governments in Argentina, Bolivia, Brazil, Chile, Cyprus, the Dominican Republic, Greece, Guatemala, Guyana, Haiti, Syria, Uruguay, and numerous other nations were overthrown by their respective military forces, funded and advised by the United States. The newly installed military rulers then rolled back the egalitarian reforms and opened their countries all the wider to foreign corporate investors.

The US national security state also has participated in destabilizing covert actions, proxy mercenary wars, or direct military attacks against revolutionary or nationalist governments in Afghanistan (in the 1980s), Angola, Cambodia, Cuba, East Timor, Egypt, Ethiopia, the Fiji Islands, Grenada, Haiti, Indonesia (under Sukarno), Iran, Jamaica, Lebanon, Libya, Mozambique, Nicaragua, Panama, Peru, Portugal, Syria, South Yemen, Venezuela (under Hugo Chavez), Western Sahara, and Iraq (under the CIA-sponsored autocratic Saddam Hussein, after he emerged as an economic nationalist and tried to cut a better deal on oil prices).

The propaganda method used to discredit many of these governments is not particularly original, indeed by now it is quite transparently predictable. Their leaders are denounced as bombastic, hostile, and psychologically flawed. They are labeled power hungry demagogues, mercurial strongmen, and the worst sort of dictators likened to Hitler himself. The countries in question are designated as "terrorist" or "rogue" states, guilty of being "anti-American" and "anti-West". Some choice few are even condemned as members of an "evil axis". When targeting a country and demonizing its leadership, US leaders are assisted by ideologically attuned publicists, pundits, academics, and former government officials. Together they create a climate of opinion that enables Washington to do whatever is necessary to inflict serious damage upon the designated nation's infrastructure and population, all in the name of human rights, anti-terrorism, and national security.

There is no better example of this than the tireless demonization of democratically-elected President Slobodan Milosevic and the US-supported wars against Yugoslavia. Louis Sell, a former US Foreign Service officer, has authored a book (Slobodan Milosevic and the Destruction of Yugoslavia, Duke University Press, 2002) that is a hit piece on Milosevic, loaded with all the usual prefabricated images and policy presumptions of the US national security state. Sell's Milosevic is a caricature, a cunning power seeker and maddened fool, who turns on trusted comrades and plays upon divisions within the party.

This Milosevic is both an "orthodox socialist" and an "opportunistic Serbian nationalist", a demagogic power-hungry "second Tito" who simultaneously wants dictatorial power over all of Yugoslavia while eagerly pursuing polices that "destroy the state that Tito created". The author does not demonstrate by reference to specific policies and programs that Milosevic is responsible for the dismemberment of Yugoslavia, he just tells us so again and again. One would think that the Slovenian, Croatian, Bosnian Muslim, Macedonian, and Kosovo Albanian secessionists and US/NATO interventionists might have had something to do with it.

In my opinion, Milosevic's real sin was that he resisted the dismemberment of Yugoslavia and opposed a US imposed hegemony. He also attempted to spare Yugoslavia the worst of the merciless privatizations and rollbacks that have afflicted other former communist countries. Yugoslavia was the only nation in Europe that did not apply for entry into the European Union or NATO or OSCE.

For some left intellectuals, the former Yugoslavia did not qualify as a socialist state because it had allowed too much penetration by private corporations and the IMF. But US policymakers are notorious for not seeing the world the way purist left intellectuals do. For them Yugoslavia was socialist enough with its developed human services sector and an economy that was over 75 percent publicly owned. Sell makes it clear that Yugoslavia's public ownership and Milosevic's defense of that economy were a central consideration in Washington's war against Yugoslavia. Milosevic, Sell complains, had a "commitment to orthodox socialism". He "portrayed public ownership of the means of production and a continued emphasis on [state] commodity production as the best guarantees for prosperity". He had to go.

To make his case against Milosevic, Sell repeatedly falls back on the usual ad hominem labeling. Thus we read that in his childhood Milosevic was "something of a prig" and of course "by nature a loner", a weird kind of kid because he was "uninterested in sports or other physical activities", and he "spurned childhood pranks in favor of his books". The author quotes an anonymous former classmate who reports that Slobodan's mother "dressed him funny and kept him soft". Worse still, Slobodan would never join in when other boys stole from orchards - no doubt a sure sign of childhood pathology.

Sell further describes Milosevic as "moody", "reclusive", and given to "mulish fatalism". But Sell's own data - when he pauses in his negative labeling and gets down to specifics - contradicts the maladjusted "moody loner" stereotype. He acknowledges that young Slobodan worked well with other youth when it came to political activities. Far from being unable to form close relations, Slobodan met a girl, his future wife, and they enjoyed an enduring lifelong attachment. In his early career when heading the Beogradska Banka, Milosevic was reportedly "communicative, caring about people at the bank, and popular with his staff". Other friends describe him as getting on well with people, "communal and relaxed", a faithful husband to his wife, and a proud and devoted father to his children. And Sell allows that Milosevic was at times "confident", "outgoing", and "charismatic". But the negative stereotype is so firmly established by repetitious pronouncement (and by years of propagation by Western media and officialdom) that Sell can simply slide over contradictory evidence - even when such evidence is provided by himself.

Sell refers to anonymous "US psychiatrists, who have studied Milosevic closely". By "closely" he must mean from afar, since no US psychiatrist has ever treated or even interviewed Milosevic. These uncited and unnamed psychiatrists supposedly diagnosed the Yugoslav leader as a "malignant narcissistic" personality. Sell tells us that such malignant narcissism fills Milosevic with self-deception and leaves him with a "chore personality" that is a "sham". "People with Milosevic's type of personality frequently either cannot or will not recognize the reality of facts that diverge from their own perception of the way the world is or should be". How does Dr Sigmund Sell know all this? He seems to find proof in the fact that Milosevic dared to have charted a course that differed from the one emanating from Washington. Surely only personal pathology can explain such "anti-West" obstinacy. Furthermore, we are told that Milosevic suffered from a "blind spot" in that he was never comfortable with the notion of private property. If this isn't evidence of malignant narcissism, what is? Sell never considers the possibility that he himself, and the global interventionists who think like him, cannot or will not "recognize the reality of facts that diverge from their own perception of the way the world is or should be".

Milosevic, we are repeatedly told, fell under the growing influence of his wife, Mirjana Markovic, "the real power behind the throne". Sell actually calls her "Lady Macbeth" on one occasion. He portrays Markovic as a complete wacko, given to uncontrollable anger; her eyes "vibrated like a scared animal"; "she suffers from severe schizophrenia" with "a tenuous grasp on reality", and is a hopeless "hypochondriac". In addition, she has a "mousy" appearance and a "dreamy" and "traumatized" personality. And like her husband, with whom she shares a "very abnormal relationship", she has "an autistic relation with the world". Worse still, she holds "hardline marxist views". We are left to wonder how the autistic dysfunctional Markovic was able to work as a popular university professor, organize and lead a new political party, and play an active role in the popular resistance against Western interventionism.

In this book, whenever Milosevic or others in his camp are quoted as saying something, they "snarl", "gush", "hiss", and "crow". In contrast, political players who win Sell's approval, "observe", "state", "note", and "conclude". When one of Milosevic's superiors voices his discomfort about "noisy Kosovo Serbs" (as Sell calls them) who were demonstrating against the mistreatment they suffered at the hands of Kosovo Albanian secessionists, Milosevic "hisses", "Why are you so afraid of the street and the people?" Some of us might think this is a pretty good question to hiss at a government leader, but Sell treats it as proof of Milosevic's demagoguery.

Whenever Milosevic did anything that aided the common citizenry, as when he taxed the interest earned on foreign currency accounts - a policy that was unpopular with Serbian elites but appreciated by the poorer strata - he is dismissed as manipulatively currying popular favor. Thus we must accept Sell's word that Milosevic never wanted the power to prevent hunger but only hungered for power. The author operates from a nonfalsefiable paradigm. If the targeted leader is unresponsive to the people, this is proof of his dictatorial proclivity. If he is responsive to them, this demonstrates his demagogic opportunism.

In keeping with US officialdom's view of the world, Sell labels "Milosevic and his minions" as "hardliners", "conservatives", and "ideologues"; they are "anti-West", and bound up in "socialist dogma". In contrast, Croatian, Bosnian, and Kosovo Albanian secessionists who worked hard to dismember Yugoslavia and deliver their respective republics to the tender mercies of neoliberal rollback are identified as "economic reformers", "the liberal leadership", and "pro-West" (read, pro-transnational corporate capitalist). Sell treats "Western-style democracy" and "a modern market economy" as necessary correlates. He has nothing to say about the dismal plight of the Eastern European countries that abandoned their deficient but endurable planned economies for the merciless exactions of laissez-faire capitalism.

Sell's sensitivity to demagoguery does not extend to Franjo Tudjman, the crypto-fascist anti-Semite Croat who had nice things to say about Hitler, and who imposed his harsh autocratic rule on the newly independent Croatia. Tudjman dismissed the Holocaust as an exaggeration, and openly hailed the Croatian Ustashe Nazi collaborators of World War II. He even employed a few aging Ustashe leaders in his government. Sell says not a word about all this, and treats Tudjman as just a good old Croatian nationalist. Likewise, he has not a critical word about the Bosnian Muslim leader Alija Izetbegovic. He comments laconically that Izetbegovic "was sentenced to three years imprisonment in 1946 for belonging to a group called the Young Muslims". One is left with the impression that the Yugoslav communist government had suppressed a devout Muslim. What Sell leaves unmentioned is that the Young Muslims actively recruited Muslim units for the Nazi SS during World War II; these units perpetrated horrid atrocities against the resistance movement and the Jewish population in Yugoslavia. Izetbegovic got off rather lightly with a three-year sentence.

Little is made in this book of the ethnic cleansing perpetrated against the Serbs by US-supported leaders like Tudjman and Izetbegovic during and after the US-sponsored wars. Conversely, no mention is made of the ethnic tolerance and diversity that existed in President Milosevic's Yugoslavia. By 1999, all that was left of Yugoslavia was Montenegro and Serbia. Readers are never told that this rump nation was the only remaining multi-ethnic society among the various former Yugoslav republics, the only place where Serbs, Albanians, Croats, Gorani, Jews, Egyptians, Hungarians, Roma, and numerous other ethnic groups could live together with some measure of security and tolerance.

The relentless demonization of Milosevic spills over onto the Serbian people in general. In Sell's book, the Serbs are aggrandizing nationalists. Kosovo Serbs demonstrating against mistreatment by Albanian nationalists are described as having their "bloodlust up". And Serb workers demonstrating to defend their rights and hard won gains are dismissed by Sell as "the lowest instruments of the mob". The Serbs who had lived in Krajina and other parts of Croatia for centuries are dismissed as colonial occupiers. In contrast, the Slovenian, Croatian, and Bosnian Muslim nationalist secessionists, and Kosovo Albanian irredentists are simply seeking "independence", "self-determination", and "cultural distinctiveness and sovereignty". In this book, the Albanian KLA gunmen are not big-time drug dealers, terrorists, and ethnic cleansers, but guerrilla fighters and patriots.

Military actions allegedly taken by the Serbs, described in the vaguest terms, are repeatedly labeled "brutal", while assaults and atrocities delivered upon the Serbs by other national groups are more usually accepted as retaliatory and defensive, or are dismissed by Sell as "untrue", "highly exaggerated", and "hyperventilated". Milosevic, Sell says, disseminated "vicious propaganda" against the Croats, but he does not give us any specifics. Sell does provide one or two instances of how Serb villages were pillaged and their inhabitants raped and murdered by Albanian secessionists. From this he grudgingly allows that "some of the Serb charges ... had a core of truth". But he makes nothing more of it.

The well-timed, well-engineered story about a Serbian massacre of unarmed Albanians in the village of Racak, hyped by US diplomat and veteran disinformationist William Walker, is wholeheartedly embraced by Sell, who ignores all the contrary evidence. An Associated Press TV crew had actually filmed the battle that took place in Racak the previous day in which Serbian police killed a number of KLA fighters. A French journalist who went through Racak later that day found evidence of a battle but no evidence of a massacre of unarmed civilians, nor did Walker's own Kosovo Verification Mission monitors. All the forensic reports reveal that almost all of the forty-four persons killed had previously been using fire arms, and all had perished in combat. Sell simply ignores this evidence.

The media-hyped story of how the Serbs allegedly killed 7,000 Muslims in Srebrenica is uncritically accepted by Sell, even though the most thorough investigations have uncovered not more than 2,000 bodies of undetermined nationality. The earlier massacres carried out by Muslims, their razing of some fifty Serbian villages around Srebrenica, as reported by two British correspondents and others, are ignored. The complete failure of Western forensic teams to locate the 250,000 or 100,000 or 50,000 or 10,000 bodies (the numbers kept changing) of Albanians supposedly murdered by the Serbs in Kosovo also goes unnoticed.

Sell's rendition of what happened at Rambouillet leaves much to be desired. Under Rambouillet, Kosovo would have been turned into a NATO colony. Milosevic might have reluctantly agreed to that, so desperate was he to avoid a full-scale NATO onslaught on the rest of Yugoslavia. To be certain that war could not be avoided, however, the US delegation added a remarkable stipulation, demanding that NATO forces and personnel were to have unrestrained access to all of Yugoslavia, unfettered use of its airports, rails, ports, telecommunication services, and airwaves, all free of cost and immune from any jurisdiction by Yugoslav authorities. NATO would also have the option to modify for its own use all of Yugoslavia's infrastructure including roads, bridges, tunnels, buildings, and utility systems. In effect, not just Kosovo but all of Yugoslavia was to be subjected to an extraterritoriality tantamount to outright colonial occupation.

Sell does not mention these particulars. Instead he assures us that the request for NATO's unimpeded access to Yugoslavia was just a pro forma protocol inserted "largely for legal reasons". A similar though less sweeping agreement was part of the Dayton package, he says. Indeed, and the Dayton agreement reduced Bosnia to a Western colony. But if there was nothing wrong with the Rambouillet ultimatum, why then did Milosevic reject it? Sell ascribes Milosevic's resistance to his perverse "bunker mentality" and his need to defy the world.

There is not a descriptive word in this book of the 78 days of around-the-clock massive NATO bombing of Yugoslavia, no mention of how it caused the loss of thousands of lives, injured and maimed thousands more, contaminated much of the land and water with depleted uranium, and destroyed much of the country's public sector industries and infrastructure-while leaving all the private Western corporate structures perfectly intact.

The sources that Sell relies on share US officialdom's view of the Balkans struggle. Observers who offer a more independently critical perspective, such as Sean Gervassi, Diana Johnstone, Gregory Elich, Nicholas Stavrous, Michel Collon, Raju Thomas, and Michel Chossudovsky are left untouched and uncited. Important Western sources I reference in my book on Yugoslavia offer evidence, testimony, and documentation that do not fit Sell's conclusions, including sources from within the European Union, the European Community's Commission on Women's Rights, the OSCE and its Kosovo Verification Mission, the UN War Crimes Commission, and various other UN commissions, various State Department reports, the German Foreign Office and German Defense Ministry reports, and the International Red Cross. Sell does not touch these sources.

Also ignored by him are the testimonies and statements of members of the US Congress who visited the Balkans, a former State Department official under the Bush administration, a former deputy commander of the US European command, several UN and NATO generals and international negotiators, Spanish air force pilots, forensic teams from various countries, and UN monitors who offer revelations that contradict the picture drawn by Sell and other apologists of US officialdom.

In sum, Sell's book is packed with discombobulated insider details, unsupported charges, unexamined presumptions, and ideologically loaded labeling. As mainstream disinformation goes, it is a job well done.

Copyright 1992 - 2003 Michael Parenti. All rights reserved.

Michael Parenti's recent books are To Kill a Nation: The Attack on Yugoslavia (Verso), and The Terrorism Trap: September 11 and Beyond (City Lights). His latest work, The Assassination of Julius Caesar: A People's History of Ancient Rome has been nominated for a Pulitzer Prize.

Copyright 1992 - 2003 Michael Parenti. All rights reserved.

http://www.michaelparenti.org/Milosevic.html

Bill Totten http://www.ashisuto.co.jp/english/

An essay in imperial villain-making

A fanatical Muslim despot was resisting the west, there were calls for regime change. We have, of course, been here before

by William Dalrymple

The Guardian (May 24 2005)


By the end of the 90s, the hardliners calling for regime change in the east found that they had a powerful ally in government. This new president was not prepared to wait to be attacked: he was a new sort of conservative, aggressive in foreign policy, bitterly anti-French, and intent on turning his country into the unrivalled global power. It was best, he believed, simply to remove any hostile Muslim regime that presumed to resist the west.

There was no doubt who would be the first to be targeted: a Muslim dictator whose family had usurped power in a military coup. According to British sources, this chief of state was an "intolerant bigot", a "furious fanatic" with a "rooted and inveterate hatred of Europeans", who had "perpetually on his tongue the projects of jihad". He was also deemed to be "oppressive and unjust ... [a] sanguinary tyrant, [and a] perfidious negotiator".

It was, in short, time to take out Tipu Sultan of Mysore. The president of the board of control, Henry Dundas, the minister who oversaw the East India Company, had just the man for the job. Richard Wellesley was sent out to India in 1798 as governor general with specific instructions to effect regime change in Mysore and replace Tipu with a western-backed puppet. First, however, Wellesley and Dundas had to justify to the British public a policy whose outcome had long been decided in private.

Wellesley therefore began a campaign of vilification against Tipu, portraying him as an aggressive Muslim monster who divided his time between oppressing his subjects and planning to drive the British into the sea. This essay in imperial villain-making opened the way for a lucrative conquest and the installation of a more pliable regime that would, in the words of Wellesley, allow the British to give the impression they were handing the country back to its rightful owners while in reality maintaining firm control.

It is a truth universally acknowledged that a politician in search of a war is not over-scrupulous with matters of fact. Until recently, the British propaganda offensive against Tipu has determined the way that we - and many Indians - remember him. But, as with more recent dossiers produced to justify pre-emptive military action against mineral-rich Muslim states, the evidence reveals far more about the desires of the attacker than it does about the reality of the attacked.

Recent work by scholars has succeeded in reconstructing a very different Tipu to the one-dimensional fanatic invented by Wellesley. Tipu, it is now clear, was one of the most innovative and far-sighted rulers of the pre-colonial period. He tried to warn other Indian rulers of the dangers of an increasingly arrogant and aggressive west. "Know you not the custom of the English?" he wrote in vain to the nizam of Hyderabad in 1796. "Wherever they fix their talons they contrive little by little to work themselves into the whole management of affairs".

What really worried the British was less that Tipu was a Muslim fanatic, something strange and alien, but that he was frighteningly familiar: a modernising technocrat who used the weapons of the west against their inventors. Indeed, in many ways, he beat them at their own game: the Mysore sepoy's flintlocks - as the examples for sale in an auction of Tipu memorabilia at Sotheby's tomorrow demonstrate - were based on the latest French designs, and were much superior to the company's old matchlocks.

Tipu also tried to import industrial technology through French engineers, and experimented with harnessing water-power to drive his machinery. He sent envoys to southern China to bring back silkworm eggs and established sericulture in Mysore - an innovation that still enriches the region today. More remarkably, he created what amounted to a state trading company with its own ships and factories dotted across the Gulf. British propaganda might portray Tipu as a savage barbarian, but he was something of a connoisseur, with a library of about 2,000 volumes in several languages.

Moreover, contrary to the propaganda of the British, Tipu - far from being some sort of fundamentalist - continued the Indo-Islamic tradition of syncretism. He certainly destroyed temples in Hindu states that he conquered in war, but temples lying within his domains were viewed as protected state property and generously supported with lands and gifts of money and even padshah lingams - a unique case of a Muslim sultan facilitating the Shaivite phallus veneration. When the great Sringeri temple was destroyed by a Maratha raiding party, Tipu sent funds for its rebuilding. "People who have sinned against such a holy place", wrote a solicitous Tipu, "are sure soon to suffer the consequences of their misdeeds".

Tipu knew what he was risking when he took on the British, but he said, "I would rather live a day as a tiger than a lifetime as a sheep". As the objects in tomorrow's sale show, the culture of innovation Tipu fostered in Mysore stands record to a man very different from that imagined by the Islamophobic propaganda of the British - and the startling inaccuracy of Wellesley's "dodgy dossier" of 1799. The fanatical bigot and savage was in fact an intellectual.

The whole episode is a sobering reminder of the degree to which old-style imperialism has made a comeback under Bush and Blair. There is nothing new about the neocons. Not only are westerners again playing their old game of installing puppet regimes, propped up by western garrisons, for their own political and economic ends but, more alarmingly, the intellectual attitudes that buttressed and sustained such imperial adventures remain intact.

Despite over 25 years of assault by Edward Said and his followers, old-style Orientalism is alive and kicking, its prejudices intact, with columnists such as Mark Steyn and Andrew Sullivan in the role of the new Mills and Macaulays. Through their pens - blissfully unencumbered by any knowledge of the Muslim world - the old colonial idea of the Islamic ruler as the decadent, destructive, degenerate Oriental despot lives on and, as before, it is effortlessly projected on a credulous public by western warmongers in order to justify their own imperial projects. Dundas and Wellesley were certainly more intelligent and articulate than Bush or Rumsfeld, but they were no less cynical in their aims, nor less ruthless in the means they employed to effect them.

www.williamdalrymple.com

William Dalrymple is the author of White Mughals (Harper-Collins, 2002)

Copyright Guardian Unlimited / Guardian Newspapers Limited 2005

http://politics.guardian.co.uk/comment/story/0,9115,1490862,00.html


Bill Totten http://www.ashisuto.co.jp/english/

Friendly Feudalism:

The Tibet Myth

by Michael Parenti

michaelparenti.org (July 2004, updated)

The histories of Christianity, Judaism, Hinduism, and Islam are heavily laced with violence. Throughout the ages, religionists have claimed a divine mandate to massacre infidels, heretics, and even other devotees within their own ranks. Some people maintain that Buddhism is different, that it stands in marked contrast to the chronic violence of other religions. To be sure, for some practitioners in the West, Buddhism is more a spiritual and psychological discipline than a theology in the usual sense. It offers meditative techniques that are said to promote enlightenment and harmony within oneself. But like any other belief system, Buddhism must be judged not only by its teachings but by the secular behavior of its proponents.


Buddhist Exceptionalism?

A glance at history reveals that Buddhist organizations have not been free of the violent pursuits so characteristic of religious groups. In Tibet, from the early seventeenth century well into the eighteenth, competing Buddhist sects engaged in armed hostilities and summary executions. <1> In the twentieth century, in Thailand, Burma, Korea, Japan, and elsewhere, Buddhists clashed with each other and with nonBuddhists. In Sri Lanka, armed battles in the name of Buddhism are part of Sinhalese history. <2>

Just a few years ago in South Korea, thousands of monks of the Chogye Buddhist order fought each other with fists, rocks, fire-bombs, and clubs, in pitched battles that went on for weeks. They were vying for control of the order, the largest in South Korea, with its annual budget of $9.2 million, its additional millions of dollars in property, and the privilege of appointing 1,700 monks to various duties. The brawls partly destroyed the main Buddhist sanctuaries and left dozens of monks injured, some seriously. The Korean public appeared to disdain both factions, feeling that no matter what side took control, "it would use worshippers' donations for luxurious houses and expensive cars". <3>

But what of the Dalai Lama and the Tibet he presided over before the Chinese crackdown in 1959? It is widely held by many devout Buddhists that Old Tibet was a spiritually oriented kingdom free from the egotistical lifestyles, empty materialism, and corrupting vices that beset modern industrialized society. Western news media, travel books, novels, and Hollywood films have portrayed the Tibetan theocracy as a veritable Shangri-La.

The Dalai Lama himself stated that "the pervasive influence of Buddhism" in Tibet, "amid the wide open spaces of an unspoiled environment resulted in a society dedicated to peace and harmony. We enjoyed freedom and contentment." <4> A reading of Tibet's history suggests a different picture. In the thirteenth century, Emperor Kublai Khan created the first Grand Lama, who was to preside over all the other lamas as might a pope over his bishops. Several centuries later, the Emperor of China sent an army into Tibet to support the Grand Lama, an ambitious 25-year-old man, who then gave himself the title of Dalai (Ocean) Lama, ruler of all Tibet. Here is quite a historical irony: the first Dalai Lama was installed by a Chinese army.

To elevate his authority beyond worldly challenge, the first Dalai Lama seized monasteries that did not belong to his sect, and is believed to have destroyed Buddhist writings that conflicted with his claim to divinity. The Dalai Lama who succeeded him pursued a sybaritic life, enjoying many mistresses, partying with friends, and acting in other ways deemed unfitting for an incarnate deity. For this he was done in by his priests. Within 170 years, despite their recognized status as gods, five Dalai Lamas were murdered by their high priests or other courtiers. <5>


Shangri-La (for Lords and Lamas)

Religions have had a close relationship not only with violence but with economic exploitation. Indeed, it is often the economic exploitation that necessitates the violence. Such was the case with the Tibetan theocracy. Until 1959, when the Dalai Lama last presided over Tibet, most of the arable land was still organized into manorial estates worked by serfs. Even a writer sympathetic to the old order allows that "a great deal of real estate belonged to the monasteries, and most of them amassed great riches ... In addition, individual monks and lamas were able to accumulate great wealth through active participation in trade, commerce, and money lending". <6> Drepung monastery was one of the biggest landowners in the world, with its 185 manors, 25,000 serfs, 300 great pastures, and 16,000 herdsmen. The wealth of the monasteries went mostly to the higher-ranking lamas, many of them scions of aristocratic families.

Secular leaders also did well. A notable example was the commander-in-chief of the Tibetan army, who owned 4,000 square kilometers of land and 3,500 serfs. He also was a member of the Dalai Lama's lay Cabinet. <7> Old Tibet has been misrepresented by some of its Western admirers as "a nation that required no police force because its people voluntarily observed the laws of karma". <8> In fact. it had a professional army, albeit a small one, that served as a gendarmerie for the landlords to keep order and hunt down runaway serfs.

Young Tibetan boys were regularly taken from their families and brought into the monasteries to be trained as monks. Once there, they became bonded for life. Tashi-Tsering, a monk, reports that it was common for peasant children to be sexually mistreated in the monasteries. He himself was a victim of repeated rape, beginning at age nine. <9> The monastic estates also conscripted impoverished peasant children for lifelong servitude as domestics, dance performers, and soldiers.


In Old Tibet there were small numbers of farmers who subsisted as a kind of free peasantry, and perhaps an additional 10,000 people who composed the "middle-class" families of merchants, shopkeepers, and small traders. Thousands of others were beggars. A small minority were slaves, usually domestic servants, who owned nothing. Their offspring were born into slavery. <10> The greater part of the rural population - some 700,000 of an estimated total of 1,250,000 - were serfs. Serfs and other peasants generally were little better than slaves. They went without schooling or medical care. They spent most of their time laboring for high-ranking lamas or for the secular landed aristocracy. Their masters told them what crops to grow and what animals to raise. They could not get married without the consent of their lord or lama. And they might easily be separated from their families should their owners send them to work in a distant location. <11>

One 22-year old woman, herself a runaway serf, reports: "Pretty serf girls were usually taken by the owner as house servants and used as he wished". They "were just slaves without rights". <12> Serfs needed permission to go anywhere. Landowners had legal authority to capture those who tried to flee. One 24-year old runaway welcomed the Chinese intervention as a "liberation". He claimed that under serfdom he was subjected to incessant toil, hunger, and cold. After his third failed escape, he was merciless beaten by the landlord's men until blood poured from his nose and mouth. They then poured alcohol and caustic soda on his wounds to increase the pain. <13>

The serfs were under a lifetime bond to work the lord's land - or the monastery's land - without pay, to repair the lord's houses, transport his crops, and collect his firewood. They were also expected to provide carrying animals and transportation on demand. <14> They were taxed upon getting married, taxed for the birth of each child, and for every death in the family. They were taxed for planting a tree in their yard and for keeping animals. There were taxes for religious festivals, for singing, dancing, drumming, and bell ringing. People were taxed for being sent to prison and upon being released. Those who could not find work were taxed for being unemployed, and if they traveled to another village in search of work, they paid a passage tax. When people could not pay, the monasteries lent them money at twenty to fifty percent interest. Some debts were handed down from father to son to grandson. Debtors who could not meet their obligations risked being placed into slavery sometimes for the rest of their lives. <15>

The theocracy's religious teachings buttressed its class order. The poor and afflicted were taught that they had brought their troubles upon themselves because of their wicked ways in previous lives. Hence they had to accept the misery of their present existence as a karmic atonement and in anticipation that their lot would improve upon being reborn. The rich and powerful of course treated their good fortune as a reward for, and tangible evidence of, virtue in past and present lives.


Torture and Mutilation

In the Dalai Lama's Tibet, torture and mutilation - including eye gouging, the pulling out of tongues, hamstringing, and amputation - were favored punishments inflicted upon runaway serfs and thieves. Journeying through Tibet in the 1960s, Stuart and Roma Gelder interviewed a former serf, Tsereh Wang Tuei, who had stolen two sheep belonging to a monastery. For this he had both his eyes gouged out and his hand mutilated beyond use. He explains that he no longer is a Buddhist: "When a holy lama told them to blind me I thought there was no good in religion". <16> Since it was against Buddhist teachings to take human life, some offenders were severely lashed and then "left to God" in the freezing night to die. "The parallels between Tibet and medieval Europe are striking", concludes Tom Grunfeld in his book on Tibet. <17>

In 1959, Anna Louise Strong visited an exhibition of torture equipment that had been used by the Tibetan overlords. There were handcuffs of all sizes, including small ones for children, and instruments for cutting off noses and ears, gouging out eyes, and breaking off hands. There were instruments for slicing off kneecaps and heels, or hamstringing legs. There were hot brands, whips, and special implements for disemboweling. <18>

The exhibition presented photographs and testimonies of victims who had been blinded or crippled or suffered amputations for thievery. There was the shepherd whose master owed him a reimbursement in yuan and wheat but refused to pay. So he took one of the master's cows; for this he had his hands severed. Another herdsman, who opposed having his wife taken from him by his lord, had his hands broken off. There were pictures of Communist activists with noses and upper lips cut off, and a woman who was raped and then had her nose sliced away. <19>

Early visitors to Tibet comment about the theocratic despotism. In 1895, an Englishman, Dr A L Waddell, wrote that the populace was under the "intolerable tyranny of monks" and the devil superstitions they had fashioned to terrorize the people. In 1904 Perceval Landon described the Dalai Lama's rule as "an engine of oppression". At about that time, another English traveler, Captain W F T O'Connor, observed that "the great landowners and the priests ... exercise each in their own dominion a despotic power from which there is no appeal", while the people are "oppressed by the most monstrous growth of monasticism and priest-craft". Tibetan rulers "invented degrading legends and stimulated a spirit of superstition" among the common people. In 1937, another visitor, Spencer Chapman, wrote, "The Lamaist monk does not spend his time in ministering to the people or educating them ... The beggar beside the road is nothing to the monk. Knowledge is the jealously guarded prerogative of the monasteries and is used to increase their influence and wealth." <20>


Occupation and Revolt

The Chinese Communists occupied Tibet in 1951, claiming suzerainty over that country. The 1951 treaty provided for ostensible self-government under the Dalai Lama's rule but gave China military control and exclusive right to conduct foreign relations. The Chinese were also granted a direct role in internal administration "to promote social reforms". At first, they moved slowly, relying mostly on persuasion in an attempt to effect change. Among the earliest reforms they wrought was to reduce usurious interest rates, and build a few hospitals and roads. "Contrary to popular belief in the West", writes one observer, the Chinese "took care to show respect for Tibetan culture and religion". No aristocratic or monastic property was confiscated, and feudal lords continued to reign over their hereditarily bound peasants. <21>

The Tibetan lords and lamas had seen Chinese come and go over the centuries and had enjoyed good relations with Generalissimo Chiang Kaishek and his reactionary Kuomintang rule in China. <22> The approval of the Kuomintang government was needed to validate the choice of the Dalai Lama and Panchen Lama. When the young Dalai Lama was installed in Lhasa, it was with an armed escort of Chinese troops and an attending Chinese minister, in accordance with centuries-old tradition. What upset the Tibetan lords and lamas was that these latest Chinese were Communists. It would be only a matter of time, they feared, before the Communists started imposing their collectivist egalitarian solutions upon Tibet.

In 1956-57, armed Tibetan bands ambushed convoys of the Chinese Peoples Liberation Army (PLA). The uprising received extensive assistance from the US Central Intelligence Agency (CIA), including military training, support camps in Nepal, and numerous airlifts. <23> Meanwhile in the United States, the American Society for a Free Asia, a CIA front, energetically publicized the cause of Tibetan resistance, with the Dalai Lama's eldest brother, Thubtan Norbu, playing an active role in that group. The Dalai Lama's second-eldest brother, Gyalo Thondup, established an intelligence operation with the CIA in 1951. He later upgraded it into a CIA-trained guerrilla unit whose recruits parachuted back into Tibet. <24>

Many Tibetan commandos and agents whom the CIA dropped into the country were chiefs of aristocratic clans or the sons of chiefs. Ninety percent of them were never heard from again, according to a report from the CIA itself, meaning they were most likely captured and killed. <25> "Many lamas and lay members of the elite and much of the Tibetan army joined the uprising, but in the main the populace did not, assuring its failure", writes Hugh Deane. <26> In their book on Tibet, Ginsburg and Mathos reach a similar conclusion: "As far as can be ascertained, the great bulk of the common people of Lhasa and of the adjoining countryside failed to join in the fighting against the Chinese both when it first began and as it progressed". <27> Eventually the resistance crumbled.


Enter the Communists

Whatever wrongs and new oppressions introduced by the Chinese in Tibet, after 1959 they did abolish slavery and the serfdom system of unpaid labor, and put an end to floggings, mutilations, and amputations as a form of criminal punishment. They eliminated the many crushing taxes, started work projects, and greatly reduced unemployment and beggary. They established secular education, thereby breaking the educational monopoly of the monasteries. And they constructed running water and electrical systems in Lhasa. <28>

Heinrich Harrer (later revealed to have been a sergeant in Hitler's SS) wrote a bestseller about his experiences in Tibet that was made into a popular Hollywood movie. He reported that the Tibetans who resisted the Chinese "were predominantly nobles, semi-nobles and lamas; they were punished by being made to perform the lowliest tasks, such as laboring on roads and bridges. They were further humiliated by being made to clean up the city before the tourists arrived." They also had to live in a camp originally reserved for beggars and vagrants. <29>

By 1961, the Chinese expropriated the landed estates owned by lords and lamas, and reorganized the peasants into hundreds of communes. They distributed hundreds of thousands of acres to tenant farmers and landless peasants. Herds once owned by nobility were turned over to collectives of poor shepherds. Improvements were made in the breeding of livestock, and new varieties of vegetables and new strains of wheat and barley were introduced, along with irrigation improvements, all of which reportedly led to an increase in agrarian production. <30>

Many peasants remained as religious as ever, giving alms to the clergy. But the many monks who had been conscripted into the religious orders as children were now free to renounce the monastic life, and thousands did, especially the younger ones. The remaining clergy lived on modest government stipends, and extra income earned by officiating at prayer services, weddings, and funerals. <31>

Both the Dalai Lama and his advisor and youngest brother, Tendzin Choegyal, claimed that "more than 1.2 million Tibetans are dead as a result of the Chinese occupation". <32> But the official 1953 census - six years before the Chinese crackdown - recorded the entire population residing in Tibet at 1,274,000. <33> Other census counts put the ethnic Tibetan population within the country at about two million. If the Chinese killed 1.2 million in the early 1960s then whole cities and huge portions of the countryside, indeed almost all of Tibet, would have been depopulated, transformed into a killing field dotted with death camps and mass graves - of which we have not seen evidence. The thinly distributed Chinese military force in Tibet was not big enough to round up, hunt down, and exterminate that many people even if it had spent all its time doing nothing else.

Chinese authorities do admit to "mistakes", particularly during the 1966-76 Cultural Revolution when religious persecution reached a high tide in both China and Tibet. After the uprising in the late 1950s, thousands of Tibetans were incarcerated. During the Great Leap Forward, forced collectivization and grain farming was imposed on the peasantry, sometimes with disastrous effect. In the late 1970s, China began relaxing controls over Tibet "and tried to undo some of the damage wrought during the previous two decades". <34>

In 1980, the Chinese government initiated reforms reportedly designed to grant Tibet a greater degree of self-rule and self-administration. Tibetans would now be allowed to cultivate private plots, sell their harvest surpluses, decide for themselves what crops to grow, and keep yaks and sheep. Communication with the outside world was again permitted, and frontier controls were eased to permit Tibetans to visit exiled relatives in India and Nepal. <35>

In the 1990s, the Han, the ethnic group comprising over 95 percent of China's immense population, began moving in substantial numbers into Tibet and various western provinces. On the streets of Lhasa and Shigatse, signs of Han preeminence are readily visible. Chinese run the factories and many of the shops and vending stalls. Tall office buildings and large shopping centers have been built with funds that might have been better spent on water treatment plants and housing. Chinese cadres in Tibet too often view their Tibetan neighbors as backward and lazy, in need of economic development and "patriotic education". During the 1990s Tibetan government employees suspected of harboring nationalist sympathies were purged from office, and campaigns were launched to discredit the Dalai Lama. Individual Tibetans reportedly were subjected to arrest, imprisonment, and forced labor for carrying out separatist activities and engaging in political "subversion". Some arrestees were held in administrative detention without adequate food, water, and blankets, subjected to threats, beatings, and other mistreatment. <36>

Chinese family planning regulations allow a three-child limit for Tibetan families. (For years there was a one-child limit for Han families.) If a couple goes over the limit, the excess children can be denied subsidized daycare, health care, housing, and education. These penalties have been enforced irregularly and vary by district. Meanwhile, Tibetan history, culture, and religion are slighted in schools. Teaching materials, though translated into Tibetan, focus on Chinese history and culture. <37>


Elites, Emigres, and the CIA

For the rich lamas and lords, the Communist intervention was a calamity. Most of them fled abroad, as did the Dalai Lama himself, who was assisted in his flight by the CIA. Some discovered to their horror that they would have to work for a living. However, throughout the 1960s, the Tibetan exile community was secretly pocketing $1.7 million a year from the CIA, according to documents released by the State Department in 1998. Once this fact was publicized, the Dalai Lama's organization itself issued a statement admitting that it had received millions of dollars from the CIA during the 1960s to send armed squads of exiles into Tibet to undermine the Maoist revolution. The Dalai Lama's annual payment from the CIA was $186,000. Indian intelligence also financed both him and other Tibetan exiles. He has refused to say whether he or his brothers worked for the CIA. The agency has also declined to comment. <38>

In 1995, the News & Observer of Raleigh, North Carolina, carried a frontpage color photograph of the Dalai Lama being embraced by the reactionary Republican senator Jesse Helms, under the headline "Buddhist Captivates Hero of Religious Right". <39> In April 1999, along with Margaret Thatcher, Pope John Paul II, and the first George Bush, the Dalai Lama called upon the British government to release Augusto Pinochet, the former fascist dictator of Chile and a longtime CIA client who had been apprehended while visiting England. The Dalai Lama urged that Pinochet not be forced to go to Spain where he was wanted to stand trial for crimes against humanity.

Today, mostly through the National Endowment for Democracy and other conduits that are more respectable-sounding than the CIA, the US Congress continues to allocate an annual $2 million to Tibetans in India, with additional millions for "democracy activities" within the Tibetan exile community. The Dalai Lama also gets money from financier George Soros, who now runs the CIA-created Radio Free Europe/Radio Liberty and other institutes. <40>


The Question of Culture

We are told that when the Dalai Lama ruled Tibet, the people lived in contented and tranquil symbiosis with their monastic and secular lords, in a social order sustained by a deeply spiritual, nonviolent culture, inspired by humane and pacific religious teachings. The Tibetan religious culture was the social glue and comforting balm that kept rich lama and poor peasant spiritually bonded together, to maintain those proselytes who embrace Old Tibet as a cultural purity, a Shangri-La.

One is reminded of the idealized imagery of feudal Europe presented by latter-day conservative Catholics such as G K Chesterton and Hilaire Belloc. For them, medieval Christendom was a world of contented peasants living in a deep spiritual bond with their Church, under the protection of their lords. <41> Again we are invited to accept a particular culture on its own terms, which means accepting it as presented by its favored class, by those at the top who profited most from it. The Shangri-La image of Tibet bears no more resemblance to historic reality than does the romanticized image of medieval Europe.

When seen in all its grim realities, Old Tibet confirms the view expressed earlier in this book that culture is anything but neutral. Culture can operate as a legitimating cover for a host of grave injustices, benefiting some portion of a society's population at great cost to other segments. In theocratic Tibet, ruling interests manipulated the traditional culture to fortify their wealth and power. The theocracy equated rebellious thought and action with satanic influence. It propagated the general presumption of landlord superiority and peasant unworthiness. The rich were represented as deserving their good life, and the poor as deserving their mean lowly existence, all codified in teachings about the karmic residues of virtues and vices accumulated from past lives, all presented as part of God's will.

It might be said that we denizens of the modern secular world cannot grasp the equations of happiness and pain, contentment and custom, that characterize more traditionally spiritual societies. This is probably true, and it may explain why some of us idealize such societies. But still, a gouged eye is a gouged eye; a flogging is a flogging; and the grinding exploitation of serfs and slaves is a brutal class injustice whatever its cultural wrapping. There is a difference between a spiritual bond and human bondage, even when both exist side by side

Many ordinary Tibetans want the Dalai Lama back in their country, but it appears that relatively few want a return to the social order he represented. A 1999 story in the Washington Post notes that he continues to be revered in Tibet, but

... few Tibetans would welcome a return of the corrupt aristocratic clans that fled with him in 1959 and that comprise the bulk of his advisers. Many Tibetan farmers, for example, have no interest in surrendering the land they gained during China's land reform to the clans. Tibet's former slaves say they, too, don't want their former masters to return to power. "I've already lived that life once before", said Wangchuk, a 67-year-old former slave who was wearing his best clothes for his yearly pilgrimage to Shigatse, one of the holiest sites of Tibetan Buddhism. He said he worshipped the Dalai Lama, but added, "I may not be free under Chinese communism, but I am better off than when I was a slave". <42>


Kim Lewis, who studied healing methods with a Buddhist monk in Berkeley, California, had occasion to talk at length with more than a dozen Tibetan women who lived in the monk's building. When she asked how they felt about returning to their homeland, the sentiment was unanimously negative. At first, Lewis thought their reluctance had to do with the Chinese occupation, but they quickly informed her otherwise. They said they were extremely grateful "not to have to marry four or five men, be pregnant almost all the time", or deal with sexually transmitted diseases contacted from a straying husband. The younger women "were delighted to be getting an education, wanted absolutely nothing to do with any religion, and wondered why Americans were so naive". They recounted stories of their grandmothers' ordeals with monks who used them as "wisdom consorts", telling them "how much merit they were gaining by providing the 'means to enlightenment' - after all, the Buddha had to be with a woman to reach enlightenment".

The women interviewed by Lewis spoke bitterly about the monastery's confiscation of their young boys in Tibet. When a boy cried for his mother, he would be told "Why do you cry for her, she gave you up - she's just a woman". Among the other issues was "the rampant homosexuality in the Gelugpa sect. All was not well in Shangri-la", Lewis opines. <43>

The monks who were granted political asylum in California applied for Social Security. Lewis, herself a devotee for a time, assisted with the paperwork. She observes that they continue to receive Social Security checks amounting to $550 to $700 per month along with Medicare and MediCal. In addition, the monks reside rent free in nicely furnished apartments. "They pay no utilities, have free access to the Internet on computers provided for them, along with fax machines, free cell and home phones and cable TV". In addition, they receive a monthly payment from their order. And the dharma center takes up a special collection from its members (all Americans), separate from membership dues. Some members eagerly carry out chores for the monks, including grocery shopping and cleaning their apartments and toilets. These same holy men "have no problem criticizing Americans for their obsession with material things". <44>

To support the Chinese overthrow of the old feudal theocracy is not to applaud everything about Chinese rule in Tibet. This point is seldom understood by today's Shangri-La adherents in the West.

The converse is also true. To denounce the Chinese occupation does not mean we have to romanticize the former feudal regime. One common complaint among Buddhist followers in the West is that Tibet's religious culture is being undermined by the occupation. Indeed this seems to be the case. Many of the monasteries are closed, and the theocracy has passed into history. What I am questioning here is the supposedly admirable and pristinely spiritual nature of that pre-invasion culture. In short, we can advocate religious freedom and independence for Tibet without having to embrace the mythology of a Paradise Lost.

Finally, it should be noted that the criticism posed herein is not intended as a personal attack on the Dalai Lama. Whatever his past associations with the CIA and various reactionaries, he speaks often of peace, love, and nonviolence. And he himself really cannot be blamed for the abuses of the ancien regime, having been but fifteen years old when he fled into exile. In 1994, in an interview with Melvyn Goldstein, he went on record as favoring since his youth the building of schools, "machines", and roads in his country. He claims that he thought the corvee (forced unpaid serf labor for the lord's benefit) and certain taxes imposed on the peasants were "extremely bad". And he disliked the way people were saddled with old debts sometimes passed down from generation to generation. <45> Furthermore, he now proposes democracy for Tibet, featuring a written constitution, a representative assembly, and other democratic essentials. <46>

In 1996, the Dalai Lama issued a statement that must have had an unsettling effect on the exile community. It reads in part as follows:

Of all the modern economic theories, the economic system of Marxism is founded on moral principles, while capitalism is concerned only with gain and profitability. Marxism is concerned with the distribution of wealth on an equal basis and the equitable utilization of the means of production. It is also concerned with the fate of the working classes - that is the majority - as well as with the fate of those who are underprivileged and in need, and Marxism cares about the victims of minority-imposed exploitation. For those reasons the system appeals to me, and it seems fair ... I think of myself as half-Marxist, half-Buddhist. <47>


And more recently in 2001, while visiting California, he remarked that "Tibet, materially, is very, very backward. Spiritually it is quite rich. But spirituality can't fill our stomachs." <48> Here is a message that should be heeded by the well-fed Buddhist proselytes in the West who wax nostalgic for Old Tibet.

What I have tried to challenge is the Tibet myth, the Paradise Lost image of a social order that actually was a retrograde theocracy of serfdom and poverty, where a favored few lived high and mighty off the blood, sweat, and tears of the many. It was a long way from Shangri-La.


Notes:

1 Melvyn C. Goldstein, The Snow Lion and the Dragon: China, Tibet, and the Dalai Lama (Berkeley: University of California Press, 1995), 6-16.

2 Mark Juergensmeyer, Terror in the Mind of God, (Berkeley: University of California Press, 2000), 113.

3 Kyong-Hwa Seok, "Korean Monk Gangs Battle for Temple Turf", San Francisco Examiner, December 3 1998.

4 Dalai Lama quoted in Donald Lopez Jr, Prisoners of Shangri-La: Tibetan Buddhism and the West (Chicago and London: Chicago University Press, 1998), 205.

5 Stuart Gelder and Roma Gelder, The Timely Rain: Travels in New Tibet (New York: Monthly Review Press, 1964), 119, 123.

6 Pradyumna P Karan, The Changing Face of Tibet: The Impact of Chinese Communist Ideology on the Landscape (Lexington, Kentucky: University Press of Kentucky, 1976), 64.

7 Gelder and Gelder, The Timely Rain, 62 and 174.

8 As skeptically noted by Lopez, Prisoners of Shangri-La, 9.

9 Melvyn Goldstein, William Siebenschuh, and Tashi-Tsering, The Struggle for Modern Tibet: The Autobiography of Tashi-Tsering (Armonk, New York: M E Sharpe, 1997).

10 Gelder and Gelder, The Timely Rain, 110.

11 Anna Louise Strong, Tibetan Interviews (Peking: New World Press, 1929), 15, 19-21, 24.

12 Quoted in Strong, Tibetan Interviews, 25.

13 Strong, Tibetan Interviews, 31.

14 Melvyn C Goldstein, A History of Modern Tibet 1913-1951 (Berkeley: University of California Press, 1989), 5.

15 Gelder and Gelder, The Timely Rain, 175-176; and Strong, Tibetan Interviews, 25-26.

16 Gelder and Gelder, The Timely Rain, 113.

17 A Tom Grunfeld, The Making of Modern Tibet revised edition (Armonk, New York and London: 1996), 9 and 7-33 for a general discussion of feudal Tibet; see also Felix Greene, A Curtain of Ignorance (Garden City, New York: Doubleday, 1961), 241-249; Goldstein, A History of Modern Tibet 1913-1951, 3-5; and Lopez, Prisoners of Shangri-La, passim.

18 Strong, Tibetan Interviews, 91-92.

19 Strong, Tibetan Interviews, 92-96.

20 Waddell, Landon, and O'Connor are quoted in Gelder and Gelder, The Timely Rain, 123-125.

21 Goldstein, The Snow Lion and the Dragon, 52.

22 Heinrich Harrer, Return to Tibet (New York: Schocken, 1985), 29.

23 See Kenneth Conboy and James Morrison, The CIA's Secret War in Tibet (Lawrence, Kansas: University of Kansas Press, 2002); and William Leary, "Secret Mission to Tibet", Air & Space, December 1997 / January 1998.

24 On the CIA's links to the Dalai Lama and his family and entourage, see Loren Coleman, Tom Slick and the Search for the Yeti (London: Faber and Faber, 1989).

25 Leary, "Secret Mission to Tibet".

26 Hugh Deane, "The Cold War in Tibet", CovertAction Quarterly (Winter 1987).

27 George Ginsburg and Michael Mathos, Communist China and Tibet (1964), quoted in Deane, "The Cold War in Tibet". Deane notes that author Bina Roy reached a similar conclusion.

28 See Greene, A Curtain of Ignorance, 248 and passim; and Grunfeld, The Making of Modern Tibet, passim.

29 Harrer, Return to Tibet, 54.

30 Karan, The Changing Face of Tibet, 36-38, 41, 57-58; London Times, 4 July 1966.

31 Gelder and Gelder, The Timely Rain, 29 and 47-48.

32 Tendzin Choegyal, "The Truth about Tibet", Imprimis (publication of Hillsdale College, Michigan), April 1999.

33 Karan, The Changing Face of Tibet, 52-53.

34 Elaine Kurtenbach, Associate Press report, San Francisco Chronicle, 12 February 1998.

35 Goldstein, The Snow Lion and the Dragon, 47-48.

36 Report by the International Committee of Lawyers for Tibet, A Generation in Peril (Berkeley California: 2001), passim.

37 International Committee of Lawyers for Tibet, A Generation in Peril, 66-68, 98.

38 Jim Mann, "CIA Gave Aid to Tibetan Exiles in '60s, Files Show", Los Angeles Times, 15 September 1998; and New York Times, 1 October, 1998; and Morrison, The CIA's Secret War in Tibet.

39 News & Observer, 6 September 1995, cited in Lopez, Prisoners of Shangri-La, 3.

40 Heather Cottin, "George Soros, Imperial Wizard", CovertAction Quarterly no 74 (Fall 2002).

41 The Gelders draw this comparison, The Timely Rain, 64.

43 John Pomfret, "Tibet Caught in China's Web", Washington Post, 23 July 1999.

43 Kim Lewis, correspondence to me, 15 July 2004.

44 Kim Lewis, additional correspondence to me, 16 July 2004.

45 Goldstein, The Snow Lion and the Dragon, 51.

46 Tendzin Choegyal, "The Truth about Tibet".

47 The Dalai Lama in Marianne Dresser (editor), Beyond Dogma: Dialogues and Discourses (Berkeley, California: North Atlantic Books, 1996).

48 Quoted in San Francisco Chronicle, 17 May 2001.

Copyright 1992 - 2005 Michael Parenti. All rights reserved.

http://www.michaelparenti.org/Tibet.html


Bill Totten http://www.ashisuto.co.jp/english/

An Interview with Matt Savinar

by Aric McBay

inthewake.org (January 15 2005)

Matt Savinar is the author of The Oil Age is Over: What to Expect as the World Runs Out of Cheap Oil, 2005-2050. He was trained as a lawyer. He maintains a website with plenty of information and articles about Peak Oil at lifeaftertheoilcrash.net. I interviewed him by email on January 15 2005.


Aric McBay: Could you summarize the current Peak Oil situation for us?

Matt Savinar: If the optimists are correct, we are ten to twenty years from the peak. If the realists are correct, we are peaking right now.

We have no scalable alternatives.

We have no plan on how to reform the banking system so that it does not require a constantly increasing supply of energy.

We have no political leaders who are willing to tell the public the truth.

In other words, it doesn't look good.


AM What does this mean for the prospects of industrial civilization? What level of technology will people be living at in fifty years?

MS Optimistically, the average westerner will be reduced to what you might consider a modern day third world level of existence. In that case, your best bet is to either be as self-sufficient as possible or extremely rich - top one percent or better. Everybody else is in deep trouble.

Pessimistically, nuclear war and radical climate change will eliminate all but a very small portion of the population.


AM What is your impression of the ability of industrial "renewables" like photovoltaics or electric windpower to prevent an industrial collapse?

MS People tend to think of alternatives to oil as somehow independent from oil. In reality, the alternatives to oil are more accurately described as "derivatives of oil". It takes massive amounts of oil and other scarce resources to locate and mine the raw materials (silver, copper, platinum, uranium, et cetera) necessary to build solar panels, windmills, and nuclear power plants. It takes more oil to construct these alternatives and even more oil to distribute them, maintain them, and adapt current infrastructure to run on them.

Each of the alternatives is besieged by numerous fundamental physical shortcomings that have, thus far, received little attention. I discuss this in greater detail on my website, lifeaftertheoilcrash.net - see the answer to the question "What about all the various alternatives to oil? Can't we find a replacement?"

Despite their individual shortcomings, it is still possible for the world economy to run on a basket of alternative sources of energy - so long as we immediately get all of the following:

1 A few dozen technological breakthroughs;

2 Unprecedented political will and bipartisan cooperation;

3 Tremendous international collaboration;

4 Massive amounts of investment capital;

5 Fundamental reforms to the structure of the international banking system;

6 No interference from the oil-and-gas industries;

7 About 25 to 50 years of general peace and prosperity to retrofit the world's $45 trillion dollar per year economy, including its transportation and telecommunications networks, manufacturing base, and agricultural systems to run on these new sources of energy;

If we get all of the above, we might be able to get the energy equivalent of three to five billion barrels of oil per year from alternative sources.

That's a tremendous amount of oil - about as much as the entire world used per year during World War II, but it's nowhere near enough to keep our currently mammoth-sized yet highly volatile global economic system going. The world currently requires over thirty billion barrels of oil per year to support economic growth. That requirement will only increase as time goes on due to population growth, debt servicing, and the industrialization of countries like China and India.

So even if the delusionally optimistic scenario described above is somehow miraculously manifested, we're still facing a full-blown meltdown of petrochemical civilization.

In short, hoping renewables will keep the age of entropy at bay is like hoping pissing in the Mississippi river will cause it to reverse course.

They're great for small scale things. We should be trying to upscale them as much as possible, but even in the best case scenario we still have to accept a future where energy is extremely expensive and extremely scarce.


AM Sometimes people tell me that "people have been predicting this for a long time, especially in the 1970s, and it hasn't happened. It's not going to happen now." Why is the situation different now? Is there anything that could prevent collapse?

MS The oil shocks of the 1970s were created by political events. In 1973, OPEC cut its production in retaliation for US support of Israel. In 1979, Iran cut its production in hopes of crippling "the great Satan". In both cases, the US was able to turn to other oil producing nations such as Venezuela to alleviate the crisis.

Once global production peaks, there won't be anybody to turn to. The crisis will just get worse and worse with each passing year.

The evidence of an imminent peak in global oil production is now overwhelming:

1 Ninety-nine percent of the world's oil comes from 44 oil producing nations. At least 24 of these nations are past their peak and now in terminal decline.

2 The entire world - with the exception of the Middle East - peaked in 1997. The US peaked in 1970, Russia in 1987, the UK in 1999.

3 Global production of conventional oil has essentially plateaued since the year 2000.

As far as "doom-and-gloom" consider what widely respected Deutsche Bank had to say about Peak Oil in a recent report entitled "Energy Prospects After the Petroleum Age":

"The end-of-the-fossil-hydrocarbons scenario is not therefore a doom-and-gloom picture painted by pessimistic end-of-the world prophets, but a view of scarcity in the coming years and decades that must be taken seriously".

On a similar note, as noted earlier, the chief economist at Morgan Stanley recently predicted that we have a ninety percent chance of facing "Economic Armageddon", while investment banker and Bush-consultant Matt Simmons has stated "the only solution is to pray".

Given the credentials of those sounding the alarm the loudest, it is extremely unwise to causally dismiss this as just more "1970s doom-and-gloom".


AM How do infrastructure attacks play into this scenario? Over the past year, attacks on oil infrastructure of been increasingly common in places like Chechnya and Iraq. In the past year numerous small-scale attacks and bombings on electrical infrastructure have also been carried out by Separatist and Anti-Imperialist groups all over the world, including in rich countries like the US, Spain and Canada. On a recent tape Osama bin Laden called for attacks on the oil infrastructure of Saudi Arabia. Could these attacks trigger an industrial collapse much early than observers predict, if they become widespread enough?

MS They certainly could and probably will.

It's like somebody who is suffering from a disease like cancer who in addition to having to deal with the effect of the disease, the treatment, and all the medical bills, then gets bitten by a wild animal on the way to the doctor's office.

Now they have to deal with the blood loss, possibility of infection, and additional medical bills resulting from the animal attack.


AM Do you want to speculate here on what sort of time frame do you expect to see in terms of collapse? How much time do people have to get their stuff together?

MS I try not to think too much about how little time we have as it causes me a great deal of anxiety.


AM What are the most important things that people can do to prepare for collapse?

MS Probably deal with the emotional aspects first. You can't learn to grow food, install solar panels, et cetera ... if you're a nervous wreck.

Overwhelming anxiety is a natural response to understanding the ramifications of peak oil, but it is not a state of mind that allows one to effectively prepare for an energy constrained future.


AM The example of "Easter Island" is often used to discuss Peak Oil and ecological overshoot. As you know, the inhabitants of Easter Island created a complex, hierarchal society with a great emphasis on building monumental stone statues. However, when Europeans first arrived on the island in 1722, the the population had been reduced to a tiny fraction of its peak, and the island was barren. The inhabitants of Easter Island destroyed their own forests by using too much wood, and once the trees were gone the ecology collapsed and streams dried up, so they resorted to constant war over the dregs of food and wood that remained, and even extensive cannibalism for food. [See Clive Ponting's writings on the subject.] What can we do to minimize violence and warfare over remaining resources when industrial civilization crashes?

MS Try telling the average American that he may have to replace his car with a bicycle. The response you get will likely include:

1 Pontifications that "riding a bicycle instead of driving a car is the moral equivalent of letting the terrorists win";

2 Admonitions that "you would probably vote for Saddam Hussein if you could", and

3 Quite possibly threats of physical violence should you ever make such a suggestion to them again.

When dealing with populations and leaders who are as energy-illiterate and irrational as we are, I don't know what, if anything, can be done to prevent a descent into anarchy.


AM One of my great worries about industrial "renewables" is that they'll permit some degree of continuation of the actions of the US military in North America and abroad. It increasingly seems that they are hoping that this is the case - for example, with the military's creation of a hybrid Hummer, or the general recent enthusiasm for "renewables" within the "National Security" crowd. How likely do you think it is that the military will attempt to build and co-opt electricity producing wind and solar installations to power their policies of invasion and domination? What can we do about this?

MS I share your concerns. We did, after all, have atomic bombs before atomic energy.

I don't know if anything can be done to stop it.


AM The longer the current industrial system is in place the more human and ecological communities it will destroy, particularly in unindustrialized countries. We depend on the communities of life for our long term survival and well-being. That means that in the long term, the sooner global deindustrialization happens the better. And yet, were civilization to collapse now it would cause some degree of violence as well, particularly for people in industrialized countries (who are more dependent on it). How do we balance the need for collapse to happen soon with fears of the violence that may happen during collapse?

MS The longer I'm aware of these issues, the less I tend to think about such big picture issues as there is little I can do to effect the speed of the collapse outside of make my own preparations.


AM I often think of the children who will be born after industrial collapse. What would you want to tell them about the events of our time? Are there any warnings that you would give them?

MS I think the initial generations (say 25 to 50 years from now) will be quite angry with us for squandering so much. They will see, for instance, that the richest person in town has access to all the food and water he wants while everybody else scrounges and struggles to survive. When they realize that everybody in the town used to live as the rich man did, you can see why they will be quite upset with generations who lived between 1850 and 2025 for squandering such wealth on useless crap and wasteful living.

250 plus years from now, they will likely tell stories and myths about us as nobody will have had access to the energy necessary to operate machinery for generations. Somebody might find the blue prints for an SUV or an IPOD and attempt to build one from wood. When it fails to work as the ancient texts described, they will be clueless as to why. The survivors of Easter Island had no clue how the statues got built. Even to this day, we don't know how the islanders did it as we can barely duplicate their efforts even when aided by heavy machinery. The same is true for the pyramids in Egypt.

As far as what I would tell them, that is hard to say as they won't have the same cultural reference points you and I have, all of which are the product of petroleum culture. I would have to put the message in terms they are likely to understand which are likely to be what we might consider "primitive" by today's standards. When you think about it, the word primitive as it is typically used really means "energy-poor" which our descendants most certainly will be.

Our descendants may read about the "Markets" and think they were our gods. The gods of transport were Ford, GM, Toyota, while the gods of information were IBM, Apple, Dell, et al ... These gods belonged to these larger gods called the "S & P 500" and "Nasdaq". The gods produced these magical machines called "cars" and "computers" and "radios" and so on ... Every morning, the people would go the machines produced by the gods to find out if the gods were happy or angry with the people. They would then turn to their shamans and gurus, such as Alan Greenspan, in hopes that the shamans and gurus would figure out how to make the gods happy again. Sometimes a god would fall from grace and wouldn't be able to associate with the other gods. This is what happened, for instance, to the god called "Enron" and his disciples, Ken Lay and Ken Fastow. Other times, a god's personal representative would be installed into positions of power among the people. The god called "Halliburton" was known for this practice.

The men in the society loved the god named "Pfizer" who would give the men a form of manna called "Viagra". They men also loved the gods named "Coors", "NFL", and "Hooters". Some of women in the society were obsessed with gods named "Gucci" and "Revlon".

Then there were some gods who were very powerful but very secretive and mysterious. The god named the "Carlyle Group" was one such god. The "Saudi Bin Laden Group" was another. We still have some ancient texts about the "Carlyle" and "Saudi-Bin Laden" gods. It is believed these were originally the work of the philosopher "Moore".

The gods fed on this stuff called "Brent Crude". When the people were no longer able to provide the gods with their food, the gods became very angry and began to abandon the people. The first gods to abandon the people were the gods of flight, such as the gods named "Delta" and "American" and "TWA". As the supply of crude dwindled, more and more of the gods abandoned the people. The people begun to fight for whatever crude was left.

In one particularly destructive battle, some of the people connected to the "Bin Laden" stole the machines of the gods of flight and used them to attack the temples of the gods of finance, commerce, and warfare. This ultimately plunged the world into a series of battles called "terror wars".

Some people thought the wind or the sun or maybe even plants would provide a replacement for the crude, but by the time they realized this was just a fantasy, it was too late.

Copyright 2003-2004 inthewake.org, redistribution for for-profit uses prohibited without permission.

NOTE: The original HTML version of this interview contains links to several other useful items related to the content herein. See http://www.inthewake.org/savinar1.html


Bill Totten http://www.ashisuto.co.jp/english/

An interview with George Draffan

by Aric McBay

inthewake.org (January 2005)

George Draffan is a forest activist, public interest investigator, and corporate muckraker. He has worked as a carpenter, landscaper, and librarian. He is the author or co-author of Cascadia Wild, Railroads & Clearcuts, The Elite Consensus, Strangely Like War, Welcome to the Machine, and several activist research manuals. He is a freelance researcher and writer for citizens and public interest groups. Some of his work can be found at Endgame.org. I interviewed him over email at the end of January, 2005.


Aric McBay: When I look at the news about Peak Oil and energy issues in the corporate-owned media, I am assured that I have nothing to worry about. If I look deeper, I might hear that there may be problems a few decades from now, but that the "experts" will have solved the problems by then. If I really dig, I might hear that the "solution" involves corporations converting to "green" companies - like British Petroleum's advertising campaign to rebrand themselves as "Beyond Petroleum" - and building an electrical renewable infrastructure that will require no effort or change on my part. Why do we hear this "take it easy" message instead of the more serious truths coming out of the independent media? How are those in power able to influence a supposedly investigative and democratic media?

George Draffan: The media isn't democratic and its purpose is not to investigate and provide a public service. Its purpose is to sell advertising, and that means entertainment: violence, sex, consumer products. It sometimes does that by "investigating" scandal or controversy, but sensational reporting is serving a commercial purpose. There are lots of ways to influence the media, but owning it is the best.

The industrial lifestyle depends on technology and anything that questions technology as ultimate solutions to all our problems is a threat. The green consumer approach is palatable to advertisers, which include auto and oil companies, and it's palatable to the consumer. Few Americans or Europeans want to reduce their consumption to the level of the average person.


McBay: Do those in power actually believe the things that the evening news tells us?

Draffan: Actually most people don't get any news. Few people watch television news, and fewer still read newspapers, and fewer still read in-depth coverage and or engage in deep discussion of issues.


McBay: What does the use of compliance-inducing propaganda about issues like Peak Oil mean for the ability of people in general to respond intelligently to those issues?

Draffan: Without knowing what's going on, it's impossible to make intelligent responses. Even more mysterious is the fact that even if we know intellectually what's going on, we often still lack the emotional will to do anything significant about it. There are lots of people who sense that there is a fundamental imbalance in the industrial way of life, but find it impossible to focus or act to actually change things. Where does emotional willingness and political will come from? What prevents us from making changes?


McBay: When there are major disruptions in the functioning of the industrial system (from oil depletion, for instance), will the media try to keep up the current facade of "everything will be fine"? How do propaganda systems respond when widespread events challenge the falsehoods they try to tell us?

Draffan: Disruptions have been happening all along. Environmental change is usually slow and we don't notice it, especially when we aren't in touch with the natural world. But the disruptions are there whether we notice them or not. The latest scandal splashes across the front pages while the more important dilemmas (energy, extinction, toxics) are ignored or treated as temporary accidents.

When something really threatening becomes public, scapegoats are found. The economic recession in the early 1990s came on top of a couple decades of lumber mills being shut down across the Pacific Northwest. The timber companies had been steadily depleting the old-growth forests over several decades, and by the 1970s and 1980s had begun shifting their operations to the South, where the trees are smaller but grow much faster. By the 1990s unemployment in the Northwest mill towns had reached crisis stage, so environmentalists were attacked for trying to save the spotted owl and other endangered species. The mills had been closing for years, for the only reason they ever close: the trees were gone. But somebody had to be blamed for the misery, so the owls were turned into goats.

Likewise, the military's policies of torture may be exposed (and what else is war but systematic campaign of atrocity?) but lower-level soldiers (or the stubborn enemy) can easily be made into scapegoats.

Or a corporation and its executives are put on trial and punished as criminals, when they are simply following standard corporate practice. A public hanging is usually enough to obscure the fact that crime is rampant and everyone is complicit. Only a few people are willing to hear that the system is fundamentally corrupt. Most of us are convinced that it's a few bad leaders, or a few terrorists, or a few hoodlums, that are the problem.


McBay: I've been told that it isn't necessary for us to dismantle the current systems of control - rather, that if we create a "better" society, people will simply flock to it and civilization as we know it will be transformed into something benevolent. To me, this implies that people live in a functioning democracy which allows the choice to "opt out" of the system. Will those in power let any significant number of people "opt out" of the capitalist economy without a fight? How do they use the mass media to try to convince people that there are no other options than that of working in the wage economy?

Draffan: Capitalist industrial economies have always depended on cheap raw materials, ever-expanding markets, the division of labor, the division of economic classes, accelerating technology, product obsolescence, and externalized costs. None of that is new. The first agricultural empires required slave labor. The first urban monuments took resources away from productive social investment. The first corporations were transnational monopolies sent out to govern colonies and to siphon goods and profits back to the economic and political elites in Europe. What's new is that those economies have expanded to the point where they are merging into a global system.

The options actually have been reduced. People actually have lost their lands, their skills, and their freedoms. There aren't easy alternatives to the wage economy and the consumer lifestyle. How many people in the "advanced" nations know how to provide their own food, clothing, and shelter? Who has access to land? People will need to relearn those ancient skills. And again, that assumes that people will make the choice to do that, and have the will as well as the intelligence to carry out the choice. What is the price of freedom?


McBay: We know that as computer and surveillance technology is "improved" it offers options for those in power to move towards an increasingly dystopic, technologically controlling society. Yet, we are assured that any given technology is being developed to "save children from being kidnapped" or for other benevolent uses. What kind of surveillance technology is currently being put in place, and is it in any way benevolent? If very controlling surveillance technology already exists, why aren't we already living in "1984"? What kind of society is this technology leading to?

Draffan: Technology serves many functions. One of them, perhaps unintended or at least hidden, is to separate us from nature, from sensation, from personal knowing. There is always a rationale for adopting the latest technology: it saves labor, or it enables you fly across the country, or it saves a life. The rationales usually succeed; I don't know of any technology that's successfully been banned or renounced. There's something about machines that people just can't resist.

The result is that those of us in the modern industrial societies are already living in dystopia. The dominate institutions of the corporate state already collect and store information about where you live, what you buy, what you do for entertainment.

Economic and political control has merged. Political opinion polls, which are often portrayed as a tool of democracy, were actually invented as marketing surveys. And when citizens allow themselves to become consumers, what's the difference? Are you willing to use one of those electronic cards that the grocery store gives you? Then they know what you buy. Do you have a bank account? An account at a video rental store? A mortgage for your house or a rental agreement for your apartment? Do you have a social security card or a driver's license? A telephone? The company or agency that provides that service has information on you.

What works in the marketplace works also works in politics. Do you vote for political candidates? What's the difference between Democrats and Republicans and Toyota and Ford? Different color, different upholstery, different rhetoric. Same shareholders, same manufacturing technology, same function.


McBay: As major disruptions in the industrial system start to occur in the coming decade, civil unrest will likely increase almost everywhere in the world - either because oppressed peoples see a weakness in institutions of control and an opportunity to become freer, or because privileged peoples will have their supplies of cheap consumable commodities interrupted. How will those in power respond to this unrest? How will their technologies of surveillance and control play a part in that?

Draffan: I hesitate to predict the collapse of civilization, or timetables for repression. Writing was first developed to inventory the centralized stocks of surplus grain. Medieval guilds controlled the movement and activity of laborers. Five hundred years ago, the first corporations were already multinational monopolies with the legal authority to tax, to raise private armies, and to administer the colonies. Within a decade of the invention of photography, the governments of Europe had files of photographs of hundreds of thousands of gypsies and itinerant tradespeople. Some of the first passports were used to keep young men from escaping military service during World War I. After World War II, the East German state had a much more sophisticated system for surveillance and compliance than the Nazi state before the war.

So there are technological advances and increasing efficiency and control, but the basic routines were developed thousands of years ago: use technology as a lever to amass economic wealth and concentrate political power, develop the sophisticated administrative systems required to control huge economies and societies, and repress or eliminate those who don't buy into the system. Most written histories are soap operas about the elites competing with each other, but if you look carefully you'll see another story line about history as an ongoing war between centralization-property and freedom-community. For thousands of years there have always been groups that have resisted being absorbed into centralized economy and government, and we ignore their successes and failures at our peril.


McBay: You've said that "the only sustainable level of technology is the stone age". Obviously, most people wouldn't even bother to consider this statement; they've been told the opposite so many times it doesn't occur to them that it might be true. What do you say to people who find that concept interesting, but don't know enough to be convinced?

Draffan: We won't return to the stone age of the past; history is never repeated. But we won't stay in the current industrial stage either, since it depends on endless growth in production and consumption. How can that be sustainable? The modern economy depends on limited resources and energy, and produces toxic chemicals. How can that be sustainable? A huge percentage of animal species are becoming extinct. We may feel that we can live without wetlands or the rhinoceros, but the loss of a species results in the loss of other species as the ecosystem unravels. How can that be sustainable? The facts of widespread ecosystem disruption are well-established, but rather than trying to prove those facts, I'll repeat the obvious: sustainable systems are the only ones that are sustainable. Humans invented agriculture 6,000 years ago. We discovered how to harness coal a couple hundred years ago, and petroleum little more than a century ago. Most of the synthetic chemicals have been invented in the past fifty years. But humans have been on the planet for a couple million years. But we have consumed more in the last century than in all previous history. What does that say about sustainability? The modern system is toxic and it consumes an unsustainable quantity of energy and resources. By definition humans will eventually, either willingly or unwillingly, evolve a steady-state economy which fits within the planet's ecological base. If we develop it willingly, soon, it could be more efficient, more elegant and enjoyable, than the heavy industrial system we have now.


McBay: What are the "three faces of power"?

Draffan: Power structure theories have offered three faces of power. The first face of power is described by the theory of pluralism, which says that society is an open system composed of various interest groups of more or less equal power who compete to get what they want. The second face of power is described by the elitist theory, which says that in reality, some individuals and groups have more power than others, and that the powerful control society's agenda. Some issues get addressed, while other issues do not. The powerful have their needs met, while the powerless do not. The powerless are excluded, and their silence or inaction is not necessarily the result of their consensus and conscious choice, as the pluralists imply. The third face of power shows how over time unequal power structures become invisible as people internalize the agenda set by the powerful. Eventually people don't even notice that some things aren't on the agenda. People believe the poor are poor and the powerless are powerless because there's something wrong with them, or because that's the way God (or karma, or fate) arranges the universe. The powerless themselves internalize their subservient role in order to escape the subjective sense of powerlessness, of being responsible for their own subservience. George Bernard Shaw wrote that monarchs are not born; they are made by artificial hallucinations. It's no longer a conspiracy when everyone thinks the same, when everyone has the same hallucination.

Copyright 2003-2004 inthewake.org, redistribution for for-profit uses prohibited without permission.

http://www.inthewake.org/draffan1.html

Bill Totten http://www.ashisuto.co.jp/english/

Our Obsolete Market Mentality

Civilization Must Find a New Thought Pattern

by Karl Polanyi

Commentary 3:109-17, 1947

Karl Polanyi considers this article to represent his first significant advance over the thesis presented in The Great Transformation (1944), which attracted international attention as an original analysis of the dilemma of free enterprise capitalism as it affects our entire Western society. Dr Polanyi was born in Vienna in 1886, and was from 1924 to 1934 on the staff of the Oesterreichische Volkswirt, a leading financial weekly. When the clerical dictatorship was established, he emigrated to England, where he lectured at Oxford and the University of London, co-edited Christianity and Social Revolution, and wrote The Essence of Fascism. He was at Bennington College from 1940 to 1943, and will return to the United States this month as visiting professor at Columbia University. This article is twelfth in the series, "The Crisis of the Individual".

The first century of the Machine Age is drawing to a close amid fear and trepidation. Its fabulous material success was due to the willing, indeed the enthusiastic, subordination of man to the needs of the machine.

Liberal capitalism was in effect man's initial response to the challenge of the Industrial Revolution. In order to allow scope to the use of elaborate, powerful machinery, we transformed human economy into a self-adjusting system of markets, and cast our thoughts and values in the mold of this unique innovation.

Today, we begin to doubt the truth of some of these thoughts and the validity of some of thesevalues. Outside the United States, liberal capitalism can hardly be said to exist any more. How to organize human life in a machine society is a question that confronts us anew. Behind the fading fabric of competitive capitalism there looms the portent of an industrial civilization, with its paralyzing division of labor, standardization of life, supremacy of mechanism over organism, and organization over spontaneity. Science itself is haunted by insanity. This is the abiding concern.

No mere reversion to the ideals of a past century can show us the way. We must brave the future, though this may involve us in an attempt to shift the place of industry in society so that the extraneous fact of the machine can be absorbed. The search for industrial democracy is not merely the search for a solution to the problems of capitalism, as most people imagine. It is a search for an answer to industry itself. Here lies the concrete problem of our civilization.

Such a new dispensation requires an inner freedom for which we are but ill equipped. We find ourselves stultified by the legacy of a market-economy which bequeathed us oversimplified views of the function and role of the economic system in society. If the crisis is to be overcome, we must recapture a more realistic vision of the human world and shape our common purpose in the light of that recognition. Industrialism is a precariously grafted scion upon man's age-long existence. The outcome of the experiment is still hanging in the balance. But man is not a simple being and can die in more than one way.

The question of individual freedom, so passionately raised in our generation, is only one aspect of this anxious problem. In truth, it forms part of a much wider and deeper need - the need for a new response to the total challenge of the machine.


The Fundamental Heresy

Our condition can be described in these terms:

Industrial civilization may yet undo man. But since the venture of a progressively artificial environment cannot, will not, and indeed, should not, be voluntarily discarded, the task of adapting life in such a surrounding to the requirements of human existence must be resolved if man is to continue on earth. No one can foretell whether such an adjustment is possible, or whether man must perish in the attempt. Hence the dark undertone of concern.

Meanwhile, the first phase of the Machine Age has run its course. It involved an organization of society that derived its name from its central institution, the market. This system is on the downgrade. Yet our practical philosophy was overwhelmingly shaped by this spectacular episode. Novel notions about man and society became current and gained the status of axioms. Here they are:

As regards man, we were made to accept the heresy that his motives can be described as "material" and "ideal", and that the incentives on which everyday life is organized spring from the "material" motives. Both utilitarian liberalism and popular Marxism favored such views.

As regards society, the kindred doctrine was propounded that its institutions were "determined" by the economic system. This opinion was even more popular with Marxists than with liberals.

Under a market-economy both assertions were, of course, true. But only under such an economy. In regard to the past, such a view was no more than an anachronism. In regard to the future, it was a mere prejudice. Yet under the influence of current schools of thought, reinforced by the authority of science and religion, politics and business, these strictly time-bound phenomena came to be regarded as timeless, as transcending the age of the market.

To overcome such doctrines, which constrict our minds and souls and greatly enhance the difficulty of the life-saving adjustment, may require no less than a reform of our consciousness.


The Market Trauma

The birth of laissez faire administered a shock to civilized man's views of himself, from the effects of which he never quite recovered. Only very gradually are we realizing what happened to us as recently as a century ago.

Liberal economy, this primary reaction of man to the machine, was a violent break with the conditions that preceded it. A chain-reaction was started - what before was merely isolated markets was transmuted into a self-regulating system of markets. And with the new economy, a new society sprang into being.

The crucial step was this: labor and land were made into commodities, that is, they were treated as if produced for sale. Of course, they were not actually commodities, since they were either not produced at all (as land) or, if so, not for sale (as labor).

Yet no more thoroughly effective fiction was ever devised. By buying and selling labor and land freely, the mechanism of the market was made to apply to them. There was now supply of labor, and demand for it; there was supply of land, and demand for it. Accordingly, there was a market price for the use of labor power, called wages, and a market price for the use of land, called rent. Labor and land were provided with markets of their own, similar to the commodities proper that were produced with their help.

The true scope of such a step can be gauged if we remember that labor is only another name for man, and land for nature. The commodity fiction handed over the fate of man and nature to the play of an automaton running in its own grooves and governed by its own laws.

Nothing similar had ever been witnessed before. Under the mercantile regime, though it deliberately pressed for the creation of markets, the converse principle still operated. Labor and land were not entrusted to the market; they formed part of the organic structure of society. Where land was marketable, only the determination of price was, as a rule, left to the parties; where labor was subject to contract, wages themselves were usually assessed by public authority. Land stood under the custom of manor, monastery, and township, under common-law limitations concerning rights of real property; labor was regulated by laws against beggary and vagrancy, statutes of laborers and artificers, poor laws, guild and municipal ordinances. In effect, all societies known to anthropologists and historians restricted markets to commodities in the proper sense of the term.

Market-economy thus created a new type of society. The economic or productive system was here entrusted to a self-acting device. An institutional mechanism controlled human beings in their everyday activities as well as the resources of nature.

This instrument of material welfare was under the sole control of the incentives of hunger and gain - or, more precisely, fear of going without the necessities of life, and expectation of profit. So long as no propertyless person could satisfy his craving for food without first selling his labor in the market, and so long as no propertied person was prevented from buying in the cheapest market and selling in the dearest, the blind mill would turn out ever-increasing amounts of commodities for the benefit of the human race. Fear of starvation with the worker, lure of profit with the employer, would keep the vast establishment running.

In this way an "economic sphere" came into existence that was sharply delimited from other institutions in society. Since no human aggregation can survive without a functioning productive apparatus, its embodiment in a distinct and separate sphere had the effect of making the "rest" of society dependent upon that sphere. This autonomous zone, again, was regulated by a mechanism that controlled its functioning. As a result, the market mechanism became determinative for the life of the body social. No wonder that the emergent human aggregation was an "economic" society to a degree previously never even approximated. "Economic motives" reigned supreme in a world of their own, and the individual was made to act on them under pain of being trodden under foot by the juggernaut market.

Such a forced conversion to a utilitarian outlook fatefully warped Western man's understanding of himself.


Hunger and Gain Enthroned

This new world of "economic motives" was based on a fallacy. Intrinsically, hunger and gain are no more "economic" than love or hate, pride or prejudice. No human motive is per se economic. There is no such thing as a sui generis economic experience in the sense in which man may have a religious, aesthetic, or sexual experience. These latter give rise to motives that broadly aim at evoking similar experiences. In regard to material production these terms lack self-evident meaning.

The economic factor, which underlies all social life, no more gives rise to definite incentives than the equally universal law of gravitation. Assuredly, if we do not eat, we must perish, as much as if we were crushed under the weight of a falling rock. But the pangs of hunger are not automatically translated into an incentive to produce. Production is not an individual, but a collective affair. If an individual is hungry, there is nothing definite for him to do. Made desperate, he might rob or steal, but such an action can hardly be called productive. With man, the political animal, everything is given not by natural, but by social circumstance. What made the 19th century think of hunger and gain as "economic" was simply the organization of production under a market economy.

Hunger and gain are here linked with production through the need of "earning an income". For under such a system, man, if he is to keep alive, is compelled to buy goods on the market with the help of an income derived from selling other goods on the market. The name of these incomes- wages, rent, interest - varies accordingly to what is offered for sale: use of labor power, of land, or of money; the income called profit - the remuneration of the entrepreneur - derives from the sale of goods that fetch a higher price than the goods that go into the producing of them. Thus all incomes derive from sales, and all sales - directly or indirectly - contribute to production. The latter is, in effect, incidental to the earning of an income. So long as an individual is "earning an income", he is, automatically, contributing to production.

Obviously, the system works only so long as individuals have a reason to indulge in the activity of "earning an income". The motives of hunger and gain - separately and conjointly - provide them with such a reason. These two motives are thus geared to production and, accordingly, are termed "economic". The semblance is compelling that hunger and gain are the incentives on which any economic system must rest.

This assumption is baseless. Ranging over human societies, we find hunger and gain not appealed to as incentives to production, and where so appealed to, they are fused with other powerful motives.

Aristotle was right: man is not an economic, but a social being. He does not aim at safeguarding his individual interest in the acquisition of material possessions, but rather at ensuring social good-will, social status, social assets. He values possessions primarily as a means to that end. His incentives are of that "mixed" character which we associate with the endeavor to gain social approval - productive efforts are no more than incidental to this. Man's economy is, as a rule, submerged in his social relations. The change from this to a society which was, on the contrary, submerged in the economic system was an entirely novel development.


Facts

The evidence of facts, I feel, should at this point be adduced.

First, there are the discoveries of primitive economics. Two names are outstanding: Bronislaw Malinowski and Richard Thurnwald. They and some other research workers revolutionized our conceptions in this field and, by so doing, founded a new discipline. The myth of the individualistic savage had been exploded long ago. Neither the crude egotism, nor the apocryphal propensity to barter, truck, and exchange, nor even the tendency to cater to one's self was in evidence. But equally discredited was the legend of the communistic psychology of the savage, his supposed lack of appreciation for his own personal interests. (Roughly, it appeared that man was very much the same all through the ages. Taking his institutions not in isolation, but in their interrelation, he was mostly found to be behaving in a manner broadly comprehensible to us.) What appeared as "communism" was the fact that the productive or economic system was usually arranged in such a fashion as not to threaten any individual with starvation. His place at the camp fire, his share in the common resources, was secure to him, whatever part he happened to have played in hunt, pasture, tillage, or gardening.

Here are a few instances: Under the kraalland system of the Kaffirs, "destitution is impossible: whosoever needs assistance receives it unquestioningly" (L P Mair, An African People in the Twentieth Century, 1934). No Kwakiutl "ever ran the least risk of going hungry" (E M Loeb, The Distribution and Function of Money in Early Society, 1936). "There is no starvation in societies living on the subsistence margin" (M J Herskovits, The Economic Life of Primitive Peoples, 1940). In effect, the individual is not in danger of starving unless the community as a whole is in a like predicament. It is this absence of the menace of individual destitution that makes primitive society, in a sense, more humane than 19th-century society, and at the same time less "economic".

The same applies to the stimulus of individual gain. Again, a few quotations: "The characteristic feature of primitive economics is the absence of any desire to make profits from production and exchange" (R Thurnwald, Economics in Primitive Communities, 1932). "Gain, which is often the stimulus for work in more civilized communities, never acts as an impulse to work under the original native conditions" (B Malinowski, Argonauts of the Western Pacific, 1930). If so-called economic motives were natural to man, we would have to judge all early and primitive societies as thoroughly unnatural.

Secondly, there is no difference between primitive and civilized society in this regard. Whether we turn to ancient city-state, despotic empire, feudalism, 13th-century urban life, 6th-century mercantile regime, or 8th century regulationism - invariably the economic system is found to be merged in the social. Incentives spring from a large variety of sources, such as custom and tradition, public duty and private commitment, religious observance and political allegiance, judicial obligation and administrative regulation as established by prince, municipality, or guild. Rank and status, compulsion of law and threat of punishment, public praise and private reputation, insure that the individual contributes his share to production.

Fear of privation or love of profit need not be altogether absent. Markets occur in all kinds of societies, and the figure of the merchant is familiar to many types of civilization. But isolated markets do not link up into an economy. The motive of gain was specific to merchants, as was valor to the knight, piety to the priest, and pride to the craftsman. The notion of making the motive of gain universal never entered the heads of our ancestors. At no time prior to the second quarter of the 9th century were markets more than a subordinate feature in society.

Thirdly, there was the startling abruptness of the change. Predominance of markets emerged not as a matter of degree, but of kind. Markets through which otherwise self-sufficient householders get rid of their surplus neither direct production nor provide the producer with his income. This is only the case in a market-economy where all incomes derive from sales, and commodities are obtainable exclusively by purchase. A free market for labor was born in England only about a century ago. The ill-famed Poor Law Reform (1834) abolished the rough-and-ready provisions made for the paupers by patriarchal governments. The poorhouse was transformed from a refuge of the destitute into an abode of shame and mental torture to which even hunger and misery were preferable. Starvation or work was the alternative left to the poor. Thus was a competitive national market for labor created. Within a decade, the Bank Act (1844) established the principle of the gold standard; the making of money was removed from the hands of the government regardless of the effect upon the level of employment. Simultaneously, reform of land laws mobilized the land, and repeal of the Corn Laws (1846) created a world pool of grain, thereby making the unprotected Continental peasant-farmer subject to the whims of the market.

Thus were established the three tenets of economic liberalism, the principle on which market economy was organized: that labor should find its price on the market; that money should be supplied by a self-adjusting mechanism; that commodities should be free to flow from country to country irrespective of the consequences - in brief, a labor market, the gold standard, and free trade. A self-inflammatory process was induced, as a result of which the formerly harmless market pattern expanded into a sociological enormity.


Birth of a Delusion

These facts roughly outline the genealogy of an "economic" society. Under such conditions the human world must appear as determined by "economic" motives. It is easy to see why.

Single out whatever motive you please, and organize production in such a manner as to make that motive the individual's incentive to produce, and you will have induced a picture of man as altogether absorbed by that particular motive. Let that motive be religious, political, or aesthetic; let it be pride, prejudice, love, or envy; and man will appear as essentially religious, political, aesthetic, proud, prejudiced, engrossed in love or envy. Other motives, in contrast, will appear distant and shadowy since they cannot be relied upon to operate in the vital business of production. The particular motive selected will represent "real" man.

As a matter of fact, human beings will labor for a large variety of reasons as long as things are arranged accordingly. Monks traded for religious reasons, and monasteries became the largest trading establishments in Europe. The Kula trade of the Trobriand Islanders, one of the most intricate barter arrangements known to man, is mainly an aesthetic pursuit. Feudal economy was run on customary lines. With the Kwakiutl, the chief aim of industry seems to be to satisfy a point of honor. Under mercantile despotism, industry was often planned so as to serve power and glory. Accordingly, we tend to think of monks or villeins, western Melanesians, the Kwakiutl, or 17th-century statesmen, as ruled by religion, aesthetics, custom, honor, or politics, respectively.

Under capitalism, every individual has to earn an income. If he is a worker, he has to sell his labor at current prices; if he is an owner, he has to make as high a profit as he can, for his standing with his fellows will depend upon the level of his income. Hunger and gain - even if vicariously - make them plough and sow, spin and weave, mine coal, and pilot planes. Consequently, members of such a society will think of themselves as governed by these twin motives.

In actual fact, man was never as selfish as the theory demanded. Though the market mechanism brought his dependence upon material goods to the fore, "economic" motives never formed with him the sole incentive to work. In vain was he exhorted by economists and utilitarian moralists alike to discount in business all other motives than "material" ones. On closer investigation, he was still found to be acting on remarkably "mixed" motives, not excluding those of duty towards himself and others - and maybe, secretly, even enjoying work for its own sake.

However, we are not here concerned with actual, but with assumed motives, not with the psychology, but with the ideology of business. Not on the former, but on the latter, are views of man's nature based. For once society expects a definite behavior on the part of its members, and prevailing institutions become roughly capable of enforcing that behavior, opinions on human nature will tend to mirror the ideal whether it resembles actuality or not.

Accordingly, hunger and gain were defined as "economic" motives, and man was supposed to be acting on them in everyday life, while his other motives appeared more ethereal and removed from humdrum existence. Honor and pride, civic obligation and moral duty, even self-respect and common decency, were now deemed irrelevant to production, and were significantly summed up in the word "ideal". Hence man was believed to consist of two components, one more akin to hunger and gain, the other to honor and power. The one was "material", the other "ideal"; the one "economic", the other "non-economic"; the one "rational", the other "non-rational". The Utilitarians went so far as to identify the two sets of terms, thus endowing the "economic" side of man's character with the aura of rationality. He who would have refused to imagine that he was acting for gain alone was thus considered not only immoral, but also mad.


Economic Determinism

The market mechanism moreover created the delusion of economic determinism as a general law for all human society.

Under a market-economy, of course, this law holds good. Indeed, the working of the economic system here not only "influences" the rest of society, but determines it - as in a triangle the sides not merely influence, but determine, the angles.

Take the stratification of classes. Supply and demand in the labor market were identical with the classes of workers and employers, respectively. The social classes of capitalists, landowners, tenants, brokers, merchants, professionals, and so on, were delimited by the respective markets for land, money, and capital and their uses, or for various services. The income of these social classes was fixed by the market, their rank and position by their income.

This was a complete reversal of the secular practice. In Maine's famous phrase, "contractus" replaced "status"; or, as Tonnies preferred to put it, "society" superseded "community"; or, in terms of the present article, instead of the economic system being embedded in social relationships, these relationships were now embedded in the economic system.

While social classes were directly, other institutions were indirectly determined by the market mechanism. State and government, marriage and the rearing of children, the organization of science and education, of religion and the arts, the choice of profession, the forms of habitation, the shape of settlements, the very aesthetics of private life - everything had to comply with the utilitarian pattern, or at least not interfere with the working of the market mechanism. But since very few human activities can be carried on in the void, even a saint needing his pillar, the indirect effect of the market system came very near to determining the whole of society. It was almost impossible to avoid the erroneous conclusion that as "economic" man was "real" man, so the economic system was "really" society.


Sex and Hunger

Yet it would be truer to say that the basic human institutions abhor unmixed motives. Just as the provisioning of the individual and his family does not commonly rely on the motive of hunger, so the institution of the family is not based on the sexual motive.

Sex, like hunger, is one of the most powerful of incentives when released from the control of other incentives. That is probably why the family in all its variety of forms is never allowed to center on the sexual instinct, with its intermittences and vagaries, but on the combination of a number of effective motives that prevent sex from destroying an institution on which so much of man's happiness depends. Sex in itself will never produce anything better than a brothel, and even then it might have to draw on some incentives of the market mechanism. An economic system actually relying for its mainspring on hunger would be almost as perverse as a family system based on the bare urge of sex.

To attempt to apply economic determinism to all human societies is little short of fantastic. Nothing is more obvious to the student of social anthropology than the variety of institutions found to be compatible with practically identical instruments of production. Only since the market was permitted to grind the human fabric into the featureless uniformity of selenic erosion has man's institutional creativeness been in abeyance. No wonder that his social imagination shows signs of fatigue. It may come to a point where he will no longer be able to recover the elasticity, the imaginative wealth and power, of his savage endowment.

No protest of mine, I realize, will save me from being taken for an "idealist". For he who decries the importance of "material" motives must, it seems, be relying on the strength of "ideal" ones. Yet no worse misunderstanding is possible. Hunger and gain have nothing specifically "material" about them. Pride, honor, and power, on the other hand, are not necessarily "higher" motives than hunger and gain.

The dichotomy itself, we assert, is arbitrary. Let us once more adduce the analogy of sex. Assuredly, a significant distinction between "higher" and "lower" motives can here be drawn. Yet, whether hunger or sex, it is pernicious to institutionalize the separation of the "material" and "ideal" components of man's being. As regards sex, this truth, so vital to man's essential wholeness, has been recognized all along; it is at the basis of the institution of marriage. But in the equally strategic field of economy, it has been neglected. This latter field has been "separated out" of society as the realm of hunger and gain. Our animal dependence upon food has been bared and the naked fear of starvation permitted to run loose. Our humiliating enslavement to the "material", which all human culture is designed to mitigate, was deliberately made more rigorous. This is at the root of the "sickness of an acquisitive society" that Tawney warned of. And Robert Owen's genius was at its best when, a century before, he described the profit motive as "a principle entirely unfavorable to individual and public happiness".


The Reality of Society

I plead for the restoration of that unity of motives which should inform man in his everyday activity as a producer, for the reabsorption of the economic system in society, for the creative adaptation of our ways of life to an industrial environment.

On all these counts, laissez-faire philosophy, with its corollary of a marketing society, falls to the ground. It is responsible for the splitting up of man's vital unity into "real" man, bent on material values, and his "ideal" better self. It is paralyzing our social imagination by more or less unconsciously fostering the prejudice of "economic determinism". It has done its service in that phase of industrial civilization which is behind us. At the price of impoverishing the individual, it enriched society. Today, we are faced with the vital task of restoring the fullness of life to the person, even though this may mean a technologically less efficient society. In different countries in different ways, classical liberalism is being discarded. On Right and Left and Middle, new avenues are being explored. British Social-Democrats, American New Dealers, and also European fascists and American anti-New Dealers of the various "managerialist" brands, reject the liberal utopia. Nor should the present political mood of rejection of everything Russian blind us to the achievement of the Russians in creative adjustment to some of the fundamental aspects of an industrial environment.

On general grounds, the Communist's expectation of the "withering away of the State" seems to me to combine elements of liberal utopianism with practical indifference to institutional freedoms. As regards the withering State, it is impossible to deny that industrial society is complex society, and no complex society can exist without organized power at the center. Yet, again, this fact is no excuse for the Communist's slurring over the question of concrete institutional freedoms.

It is on this level of realism that the problem of individual freedom should be met. No human society is possible in which power and compulsion are absent, nor is a world in which force has no function. Liberal philosophy gave a false direction to our ideals in seeming to promise the fulfillment of such intrinsically utopian expectations.

But under the market system, society as a whole remained invisible. Anybody could imagine himself free from responsibility for those acts of compulsion on the part of the state which he, personally, repudiated, or for unemployment and destitution from which he, personally, did not benefit. Personally, he remained unentangled in the evils of power and economic value. In good conscience, he could deny their reality in the name of his imaginary freedom.

Power and economic value are, indeed, a paradigm of social reality. Neither power nor economic value spring from human volition; non-cooperation is impossible in regard to them. The function of power is to insure that measure of conformity which is needed for the survival of the group: as David Hume showed, its ultimate source is opinion - and who could help holding opinions of some sort or other? Economic value, in any society, insures the usefulness of the goods produced; it is a seal set on the division of labor. Its source is human wants - and how could we be expected not to prefer one thing to another? Any opinion or desire, no matter what society we live in, will make us participants in the creation of power and the constituting of value. No freedom to do otherwise is conceivable. An ideal that would ban power and compulsion from society is intrinsically invalid. By ignoring this limitation on man's meaningful wishes, the marketing view of society reveals its essential immaturity.


The Problem of Freedom

The breakdown of market-economy imperils two kinds of freedoms: some good, some bad.

That the freedom to exploit one's fellows, or the freedom to make inordinate gains without commensurable service to the community, the freedom to keep technological inventions from being used for the public benefit, or the freedom to profit from public calamities secretly engineered for private advantage, may disappear, together with the free market, is all to the good.

But the market-economy under which these freedoms thrived also produced freedoms that we prize highly. Freedom of conscience, freedom of speech, freedom of meeting, freedom of association, freedom to choose one's job - we cherish them for their own sake. Yet to a large extent they were by-products of the same economy that was also responsible for the evil freedoms.

The existence of a separate economic sphere in society created, as it were, a gap between politics and economics, between government and industry, that was in the nature of a no man's land. As division of sovereignty between pope and emperor left medieval princes in a condition of freedom sometimes bordering on anarchy, so division of sovereignty between government and industry in the 19th century allowed even the poor man to enjoy freedoms that partly compensated for his wretched status.

Current scepticism in regard to the future of freedom largely rests on this. There are those who argue, like Hayek, that since free institutions were a product of market-economy, they must give place to serfdom once that economy disappears. There are others, like Burnham, who assert the inevitability of some new form of serfdom called "managerialism".

Arguments like these merely prove to what extent economistic prejudice is still rampant. For such determinism, as we have seen, is only another name for the market-mechanism. It is hardly logical to argue the effects of its absence on the strength of an economic necessity which derives from its presence. And it is certainly contrary to Anglo-Saxon experience. Neither the freezing of labor nor selective service abrogated the essential freedoms of the American people, as anybody can witness who spent the crucial years 1940-1943 in these States. Great Britain during the war introduced an all-round planned economy and did away with that separation of government and industry from which 19th-century freedom sprang, yet never were public liberties more securely entrenched than at the height of the emergency. In truth, we will have just as much freedom as we will desire to create and to safeguard. There is no one determinant in human society. Institutional guarantees of personal freedom are compatible with any economic system. In market society alone did the economic mechanism lay down the law.


Man versus Industry

What appears to our generation as the problem of capitalism is, in reality, the far greater problem of an industrial civilization. The economic liberal is blind to this fact. In defending capitalism as an economic system, he ignores the challenge of the Machine Age. Yet the dangers that make the bravest quake today transcend economy. The idyllic concerns of trust-busting and Taylorization have been superseded by Hiroshima. Scientific barbarism is dogging our footsteps. The Germans were planning a contrivance to make the sun emanate death rays. We, in fact, produced a burst of death rays that blotted out the sun. Yet the Germans had an evil philosophy, and we had a humane philosophy. In this we should learn to see the symbol of our peril.

Among those in America who are aware of the dimensions of the problem, two tendencies are discernible: some believe in elites and aristocracies, in managerialism and the corporation. They feel that the whole of society should be more intimately adjusted to the economic system, which they would wish to maintain unchanged. This is the ideal of the Brave New World, where the individual is conditioned to support an order that has been designed for him by such as are wiser than he. Others, on the contrary, believe that in a truly democratic society, the problem of industry would resolve itself through the planned intervention of the producers and consumers themselves. Such conscious and responsible action is, indeed, one of the embodiments of freedom in a complex society. But, as the contents of this article suggest, such an endeavor cannot be successful unless it is disciplined by a total view of man and society very different from that which we inherited from market economy.


Bill Totten http://www.ashisuto.co.jp/english/

A Game of Double Bluff

The UK and EU are keeping the poorer nations exactly where they want them: beholden to their patrons

by George Monbiot

The Guardian (May 31 2005)


Rejoice! The world is saved! The governments of Europe have agreed that by 2015 they will give 0.7% of their national income in foreign aid. Admittedly that's 35 years after the target date they first set for themselves, and it's still less than they extract from the poor in debt repayments. But hurray anyway. Though he does not become president of the EU until later this year, Tony Blair can take some of the credit, for his insistence that the G8 summit in July makes poverty history. It's inspiring, until you understand the context.

Everyone who has studied global poverty - including the European governments - recognises that aid cannot compensate for unfair terms of trade. If they increased their share of world exports by 5%, developing countries would earn an extra $350 billion a year, three times more than they will be given in 2015. <1> Any government which wanted to help developing nations would surely make the terms of trade between rich and poor its priority.

This, indeed, is what the United Kingdom appears to have done. In March it published the most progressive foreign policy document ever to have escaped from Whitehall. A paper by the departments of trade and international development promised that "we will not force trade liberalisation on developing countries". <2> It recognised that a policy which insists on equal terms for rich and poor is like pitching a bull mastiff against a chihuahua. Unless a country can first build up its industries behind protectionist barriers, it will be destroyed by free trade. Almost every nation which is rich today, including the UK and the US, used this strategy. But the current rules forbid the poor from following them. The European Union, the paper insisted, should, while opening its own markets, allow poor nations "twenty years or more" to open theirs.

But two weeks ago, the Guardian obtained a leaked letter showing that Peter Mandelson, the European trade commissioner, was undermining the United Kingdom's new policies. His most senior official complained that the policy document was "a major and unwelcome shift ... Peter Mandelson is taking up our concerns and will press for a revised UK line". <3>

We are being asked to believe, in other words, that a man who owes his entire political career to Tony Blair, and who had until that point repaid him with nauseating sycophancy, was conspiring to destroy his cherished policy. It doesn't look very likely, and it doesn't take a great imaginative effort to see that a double game was being played. Before the election, Blair makes one of his tear-jerking appeals for greater love, compassion and human fellowship, and gets the anti-poverty movement off his back. After the election he discovers, to his inestimable regret, that love, compassion and human fellowship won't after all be possible, as a result of a ruling by the European Commission.

This outcome was in fact predicted by the World Development Movement, when the remarkable paper was published in March. "Time will tell if the UK Government will put real political capital into this announcement, or if they will hide behind the European Commission and claim inability to affect the negotiations". <4> Nostradamus had nothing on these guys.

The idea that Blair had no more intention of introducing fair terms of trade than I have of becoming a Catholic priest gains credence from the UK's support for the bid by Pascal Lamy, Mandelson's predecessor, to become head of the World Trade Organisation - a post he won on Thursday. Making Lamy head of the WTO is as mad as making, say, Paul Wolfowitz ... er, well, satire doesn't really seem to work any more.

Everyone seems to have forgotten that Lamy was the man who destroyed the world trade talks in Mexico in September 2003. He tried to force through new rules on investment, competition and procurement, which would have allowed corporations to dictate terms to the poor world's governments. He persisted with this policy even when he had lost the support of European governments, and when it became obvious that his position would force the poorer nations to pull out. For cynics like me, it wasn't hard to see why. For the first time in the World Trade Organisation's history, the poor nations were making effective use of collective bargaining, and demanding major concessions from the rich. By destroying the talks, Lamy prevented a fairer trading regime from being introduced. He left the rich countries free to strike individual treaties with their weaker trading partners. And the UK and the rest of Europe hid behind him.

So the poor world is going to need the extra aid, in 2015 and far beyond. This means that it will remain obedient to the demands of countries with an interest in its continued exploitation. Those demands have done more than anything else to hold it down. As the World Bank's own figures show, across the twenty years (1960-1980) before it and the IMF started introducing strict conditions on the countries which accepted their loans, median annual growth in developing countries was 2.5%. In the twenty years after (1980-2000), it was 0.0%. <5>

The British government has made its own contribution to the poor world's misery, by tying its aid disbursements to the privatisation of essential public services. It has been paying the far right-wing lobby group the Adam Smith Institute up to GBP 9 million a year to oversee privatisation programmes in developing countries. <6> Last week, Tanzania pulled out of the deal our government had rigged up for the British company Biwater, to privatise the water supplies in Dar Es Salaam.

Again the government admitted, before the election, that its critics were right. The Department for International Development (DfID) published a long mea culpa, in which it promised "We will not make our aid conditional on specific policy decisions by partner governments, or attempt to impose policy choices on them (including ... privatisation or trade liberalisation)". <7> It looks great, until you read the whole document. On privatisation, DfID admits that there was "concern that in the 1980s and 1990s donors pushed for the introduction of reforms, regardless of whether these were in countries' best interests". The 1980s and 1990s, eh? What about the privatisation it was demanding in 2004 and early 2005? What about its recent assault on the public services of Tanzania, South Africa, Ghana and the Indian state of Andhra Pradesh? <8> What about the money it is STILL paying the effing Adam Smith Institute?

DfID goes on to say that it will decide whether to give money to a country by looking "to the IMF to provide an assessment of a country's macroeconomic position". It knows full well that the IMF continues to judge countries by the degree to which they embrace privatisation and liberalisation. Yet again, the British government is outsourcing its ethics, using the policy of an international body to make justice history.

While using the right language and flattering their critics, the UK and the EU are keeping the poorer nations where they want them: beholden to their patrons. Suddenly an increase in aid doesn't look like such good news after all.

www.monbiot.com

References:

1. Oxfam International, 2002. Rigged Rules and Double Standards: Trade, Globalisation and the Fight Against Poverty. Oxfam, Oxford.

2. DTI and DfID, March 2005. Economic Partnership Agreements : Making EPAs Deliver For Development. http://www.dti.gov.uk/ewt/epas.pdf

3. Larry Elliott, 19th May 2005. EU move to block trade aid for poor. The Guardian.

4. The World Development Movement, March 2005. The Big Trade-off. http://www.wdm.org.uk/campaigns/trade/bigtradeoff.pdf#

5. William Easterly, February 2001. The Lost Decades: Developing Countries' Stagnation in Spite of Policy Reform 1980-1998, World Bank, Cited by Christian Aid, 2005. The Damage Done: Aid, Death and Dogma.
http://www.christianaid.org.uk/indepth/505caweek/CAW%20report.pdf

6.Parliamentary answer by Hilary Benn, 26th January 2004. Column 14W. http://www.parliament.the-stationery-office.co.uk/pa/cm200304/cmhansrd/cm040126/text/40126w03.htm

7. DfID, March 2005. Partnerships for poverty reduction: rethinking conditionality.
http://www.dfid.gov.uk/pubs/files/conditionality.pdf

8. See, for eg George Monbiot, 19th October 2004. Exploitation on Tap. The Guardian. http://www.monbiot.com/archives/2004/10/19/exploitation-on-tap/ ;
George Monbiot, 18th May 2004. This Is What We Paid For. The Guardian. http://www.monbiot.com/archives/2004/05/18/this-is-what-we-paid-for/ and George Monbiot, 6th January 2004. On the Edge of Lunacy. The Guardian. http://www.monbiot.com/archives/2004/01/06/on-the-edge-of-lunacy/


http://www.monbiot.com/archives/2005/06/06/a-game-of-double-bluff-/

Bill Totten http://www.ashisuto.co.jp/english/

The Primitivist Critique of Civilization

by Richard Heinberg

A paper presented at the 24th annual meeting of the International Society for the Comparative Study of Civilizations at Wright State University, Dayton, Ohio (June 15 1995)


I. Prologue

Having been chosen - whether as devil's advocate or sacrificial lamb, I am not sure - to lead off this discussion on the question, "Was Civilization a Mistake?", I would like to offer some preliminary thoughts.

From the viewpoint of any non-civilized person, this consideration would appear to be steeped in irony. Here we are, after all, some of the most civilized people on the planet, discussing in the most civilized way imaginable whether civilization itself might be an error. Most of our fellow civilians would likely find our discussion, in addition to being ironic, also disturbing and pointless: after all, what person who has grown up with cars, electricity, and television would relish the idea of living without a house, and of surviving only on wild foods?

Nevertheless, despite the possibility that at least some of our remarks may be ironic, disturbing, and pointless, here we are. Why? I can only speak for myself. In my own intellectual development I have found that a critique of civilization is virtually inescapable for two reasons.

The first has to do with certain deeply disturbing trends in the modern world. We are, it seems, killing the planet. Revisionist "wise use" advocates tell us there is nothing to worry about; dangers to the environment, they say, have been wildly exaggerated. To me this is the most blatant form of wishful thinking. By most estimates, the oceans are dying, the human population is expanding far beyond the long-term carrying capacity of the land, the ozone layer is disappearing, and the global climate is showing worrisome signs of instability. Unless drastic steps are taken, in fifty years the vast majority of the world's population will likely be existing in conditions such that the lifestyle of virtually any undisturbed primitive tribe would be paradise by comparison.

Now, it can be argued that civilization per se is not at fault, that the problems we face have to do with unique economic and historical circumstances. But we should at least consider the possibility that our modern industrial system represents the flowering of tendencies that go back quite far. This, at any rate, is the implication of recent assessments of the ecological ruin left in the wake of the Roman, Mesopotamian, Chinese, and other prior civilizations. Are we perhaps repeating their errors on a gargantuan scale?

If my first reason for criticizing civilization has to do with its effects on the environment, the second has to do with its impact on human beings. As civilized people, we are also domesticated. We are to primitive peoples as cows and sheep are to bears and eagles. On the rental property where I live in California my landlord keeps two white domesticated ducks. These ducks have been bred to have wings so small as to prevent them from flying. This is a convenience for their keepers, but compared to wild ducks these are pitiful creatures.

Many primal peoples tend to view us as pitiful creatures, too - though powerful and dangerous because of our technology and sheer numbers. They regard civilization as a sort of social disease. We civilized people appear to act as though we were addicted to a powerful drug - a drug that comes in the forms of money, factory-made goods, oil, and electricity. We are helpless without this drug, so we have come to see any threat to its supply as a threat to our very existence. Therefore we are easily manipulated - by desire (for more) or fear (that what we have will be taken away) - and powerful commercial and political interests have learned to orchestrate our desires and fears in order to achieve their own purposes of profit and control. If told that the production of our drug involves slavery, stealing, and murder, or the ecological equivalents, we try to ignore the news so as not to have to face an intolerable double bind.

Since our present civilization is patently ecologically unsustainable in its present form, it follows that our descendants will be living very differently in a few decades, whether their new way of life arises by conscious choice or by default. If humankind is to choose its path deliberately, I believe that our deliberations should include a critique of civilization itself, such as we are undertaking here. The question implicit in such a critique is, What have we done poorly or thoughtlessly in the past that we can do better now? It is in this constructive spirit that I offer the comments that follow.


II. Civilization and Primitivism

What Is Primitivism?

The image of a lost Golden Age of freedom and innocence is at the heart of all the world's religions, is one of the most powerful themes in the history of human thought, and is the earliest and most characteristic expression of primitivism - the perennial belief in the necessity of a return to origins.

As a philosophical idea, primitivism has had as its proponents Lao Tze, Rousseau, and Thoreau, as well as most of the pre-Socratics, the medieval Jewish and Christian theologians, and 19th- and 20th-century anarchist social theorists, all of whom argued (on different bases and in different ways) the superiority of a simple life close to nature. More recently, many anthropologists have expressed admiration for the spiritual and material advantages of the ways of life of the world's most "primitive" societies - the surviving gathering-and-hunting peoples who now make up less than one hundredth of one percent of the world's population.

Meanwhile, as civilization approaches a crisis precipitated by overpopulation and the destruction of the ecological integrity of the planet, primitivism has enjoyed a popular resurgence, by way of increasing interest in shamanism, tribal customs, herbalism, radical environmentalism, and natural foods. There is a widespread (though by no means universally shared) sentiment that civilization has gone too far in its domination of nature, and that in order to survive - or, at least, to live with satisfaction - we must regain some of the spontaneity and naturalness of our early ancestors.

What Is Civilization?

There are many possible definitions of the word civilization. Its derivation - from civis, "town" or "city" - suggests that a minimum definition would be, "urban culture". Civilization also seems to imply writing, division of labor, agriculture, organized warfare, growth of population, and social stratification.

Yet the latest evidence calls into question the idea that these traits always go together. For example, Elizabeth Stone and Paul Zimansky's assessment of power relations in the Mesopotamian city of Maskan-shapir (published in the April 1995 Scientific American) suggests that urban culture need not imply class divisions. Their findings seem to show that civilization in its earliest phase was free of these. Still, for the most part the history of civilization in the Near East, the Far East, and Central America, is also the history of kingship, slavery, conquest, agriculture, overpopulation, and environmental ruin. And these traits continue in civilization's most recent phases - the industrial state and the global market - though now the state itself takes the place of the king, and slavery becomes wage labor and de facto colonialism administered through multinational corporations. Meanwhile, the mechanization of production (which began with agriculture) is overtaking nearly every avenue of human creativity, population is skyrocketing, and organized warfare is resulting in unprecedented levels of bloodshed.

Perhaps, if some of these undesirable traits were absent from the very first cities, I should focus my critique on "Empire Culture" instead of the broader target of "civilization". However, given how little we still know about the earliest urban centers of the Neolithic era, it is difficult as yet to draw a clear distinction between the two terms.


III. Primitivism versus Civilization

Wild Self/Domesticated Self

People are shaped from birth by their cultural surroundings and by their interactions with the people closest to them. Civilization manipulates these primary relationships in such a way as to domesticate the infant - that is, so as to accustom it to life in a social structure one step removed from nature. The actual process of domestication is describable as follows, using terms borrowed from the object-relations school of psychology.

The infant lives entirely in the present moment in a state of pure trust and guilelessness, deeply bonded with her mother. But as she grows, she discovers that her mother is a separate entity with her own priorities and limits. The infant's experience of relationship changes from one of spontaneous trust to one that is suffused with need and longing. This creates a gap between Self and Other in the consciousness of the child, who tries to fill this deepening rift with transitional objects - initially, perhaps a teddy bear; later, addictions and beliefs that serve to fill the psychic gap and thus provide a sense of security. It is the powerful human need for transitional objects that drives individuals in their search for property and power, and that generates bureaucracies and technologies as people pool their efforts.

This process does not occur in the same way in the case of primitive childbearing, where the infant is treated with indulgence, is in constant physical contact with a caregiver throughout infancy, and later undergoes rites of passage. In primal cultures the need for transitional objects appears to be minimized. Anthropological and psychological research converge to suggest that many of civilized people's emotional ills come from our culture's abandonment of natural childrearing methods and initiatory rites and its systematic substitution of alienating pedagogical practices from crib through university.

Health: Natural or Artificial?

In terms of health and quality of life, civilization has been a mitigated disaster. S Boyd Eaton, MD, et al, argued in The Paleolithic Prescription (1988) that pre agricultural peoples enjoyed a generally healthy way of life, and that cancer, heart disease, strokes, diabetes, emphysema, hypertension, and cirrhosis - which together lead to 75 percent of all mortality in industrialized nations - are caused by our civilized lifestyles. In terms of diet and exercise, preagricultural lifestyles showed a clear superiority to those of agricultural and civilized peoples.

Much-vaunted increases in longevity in civilized populations have resulted not so much from wonder drugs, as merely from better sanitation - a corrective for conditions created by the overcrowding of cities; and from reductions in infant mortality. It is true that many lives have been spared by modern antibiotics. Yet antibiotics also appear responsible for the evolution of resistant strains of microbes, which health officials now fear could produce unprecedented epidemics in the next century.

The ancient practice of herbalism, evidence of which dates back at least 60,000 years, is practiced in instinctive fashion by all higher animals. Herbal knowledge formed the basis of modern medicine and remains in many ways superior to it. In countless instances, modern synthetic drugs have replaced herbs not because they are more effective or safer, but because they are more profitable to manufacture.

Other forms of "natural" healing - massage, the "placebo effect", the use of meditation and visualization - are also being shown effective. Medical doctors Bernie Siegel and Deepak Chopra are critical of mechanized medicine and say that the future of the healing professions lies in the direction of attitudinal and natural therapies.

Spirituality: Raw or Cooked?

Spirituality means different things to different people - humility before a higher power or powers; compassion for the suffering of others; obedience to a lineage or tradition; a felt connection with the Earth or with Nature; evolution toward "higher" states of consciousness; or the mystical experience of oneness with all life or with God. With regard to each of these fundamental ways of defining or experiencing the sacred, spontaneous spirituality seems to become regimented, dogmatized, even militarized, with the growth of civilization. While some of the founders of world religions were intuitive primitivists (Jesus, Lao Tze, the Buddha), their followers have often fostered the growth of dominance hierarchies.

The picture is not always simple, though. The thoroughly civilized Roman Catholic Church produced two of the West's great primitivists - St Francis and St Clair; while the neo-shamanic, vegetarian, and herbalist movements of early 20th century Germany attracted arch-authoritarians Heinrich Himmler and Adolph Hitler. Of course, Nazism's militarism and rigid dominator organization were completely alien to primitive life, while St Francis's and St Clair's voluntary poverty and treatment of animals as sacred were reminiscent of the lifestyle and worldview of most gathering-and-hunting peoples. If Nazism was atavistic, it was only highly selectively so.

A consideration of these historical ironies is useful in helping us isolate the essentials of true primitivist spirituality - which include spontaneity, mutual aid, encouragement of natural diversity, love of nature, and compassion for others. As spiritual teachers have always insisted, it is the spirit (or state of consciousness) that is important, not the form (names, ideologies, and techniques). While from the standpoint of Teilhard de Chardin's idea of spiritual evolutionism, primitivist spirituality may initially appear anti-evolutionary or regressive, the essentials we have cited are timeless and trans-evolutionary - they are available at all stages, at all times, for all people. It is when we cease to see civilization in terms of theories of cultural evolution and see it merely as one of several possible forms of social organization that we begin to understand why religion can be liberating, enlightening, and empowering when it holds consistently to primitivist ideals; or deadening and oppressive when it is co-opted to serve the interests of power.

Economics: Free or Unaffordable?

At its base, economics is about how people relate with the land and with one another in the process of fulfilling their material wants and needs. In the most primitive societies, these relations are direct and straightforward. Land, shelter, and food are free. Everything is shared, there are no rich people or poor people, and happiness has little to do with accumulating material possessions. The primitive lives in relative abundance (all needs and wants are easily met) and has plenty of leisure time.

Civilization, in contrast, straddles two economic pillars - technological innovation and the marketplace. "Technology" here includes everything from the plow to the nuclear reactor - all are means to more efficiently extract energy and resources from nature. But efficiency implies the reification of time, and so civilization always brings with it a preoccupation with past and future; eventually the present moment nearly vanishes from view. The elevation of efficiency over other human values is epitomized in the factory - the automated workplace - in which the worker becomes merely an appendage of the machine, a slave to clocks and wages.

The market is civilization's means of equating dissimilar things through a medium of exchange. As we grow accustomed to valuing everything according to money, we tend to lose a sense of the uniqueness of things. What, after all, is an animal worth, or a mountain, or a redwood tree, or an hour of human life? The market gives us a numerical answer based on scarcity and demand. To the degree that we believe that such values have meaning, we live in a world that is desacralized and desensitized, without heart or spirit.

We can get some idea of ways out of our ecologically ruinous, humanly deadening economic cage by examining not only primitive lifestyles, but the proposals of economist E F Schumacher, the experiences of people in utopian communities in which technology and money are marginalized, and the lives of individuals who have adopted an attitude of voluntary simplicity.

Government: Bottom Up or Top Down?

In the most primitive human societies there are no leaders, bosses, politics, laws, crime, or taxes. There is often little division of labor between women and men, and where such division exists both gender's contributions are often valued more or less equally. Probably as a result, many foraging peoples are relatively peaceful (anthropologist Richard Lee found that "the !Kung [Bushmen of southern Africa] hate fighting, and think anybody who fought would be stupid").

With agriculture usually come division of labor, increased sexual inequality, and the beginnings of social hierarchy. Priests, kings, and organized, impersonal warfare all seem to come together in one package. Eventually, laws and borders define the creation of the fully fledged state. The state as a focus of coercion and violence has reached its culmination in the 19th and 20th centuries in colonialism, fascism, and Stalinism. Even the democratic industrial state functions essentially as an instrument of multinational corporate-style colonial oppression and domestic enslavement, its citizens merely being given the choice between selected professional bureaucrats representing political parties with slightly varying agendas for the advancement of corporate power.

Beginning with William Godwin in the early 19th century, anarchist social philosophers have offered a critical counterpoint to the increasingly radical statism of most of the world's civilized political leaders. The core idea of anarchism is that human beings are fundamentally sociable; left to themselves, they tend to cooperate to their mutual benefit. There will always be exceptions, but these are best dealt with informally and on an individual basis. Many anarchists cite the Athenian polis, the "sections" in Paris during the French Revolution, the New England town meetings of the 18th century, the popular assemblies in Barcelona in the late 1930s, and the Paris general strike of 1968 as positive examples of anarchy in action. They point to the possibility of a kind of social ecology, in which diversity and spontaneity are permitted to flourish unhindered both in human affairs and in Nature.

While critics continue to describe anarchism as a practical failure, organizational and systems theorists Tom Peters and Peter Senge are advocating the transformation of hierarchical, bureaucratized organizations into more decentralized, autonomous, spontaneous ones. This transformation is presently underway in - of all places - the very multinational corporations that form the backbone of industrial civilization.

Civilization and Nature

Civilized people are accustomed to an anthropocentric view of the world. Our interest in the environment is utilitarian: it is of value because it is of use (or potential use) to human beings - if only as a place for camping and recreation.

Primitive peoples, in contrast, tended to see nature as intrinsically meaningful. In many cultures prohibitions surrounded the overhunting of animals or the felling of trees. The aboriginal peoples of Australia believed that their primary purpose in the cosmic scheme of things was to take care of the land, which meant performing ceremonies for the periodic renewal of plant and animal species, and of the landscape itself.

The difference in effects between the anthropocentric and ecocentric worldviews is incalculable. At present, we human beings - while considering ourselves the most intelligent species on the planet - are engaged in the most unintelligent enterprise imaginable: the destruction of our own natural life-support system. We need here only mention matters such as the standard treatment of factory-farmed domesticated food animals, the destruction of soils, the pollution of air and water, and the extinctions of wild species, as these horrors are well documented. It seems unlikely that these could ever have arisen but for an entrenched and ever-deepening trend of thinking that separates humanity from its natural context and denies inherent worth to non-human nature.

The origin and growth of this tendency to treat nature as an object separate from ourselves can be traced to the Neolithic revolution, and through the various stages of civilization's intensification and growth. One can also trace the countercurrent to this tendency from the primitivism of the early Taoists to that of today's deep ecologists, ecofeminists, and bioregionalists.

How We Compensate for Our Loss of Nature

How do we make up for the loss of our primitive way of life? Psychotherapy, exercise and diet programs, the vacation and entertainment industries, and social welfare programs are necessitated by civilized, industrial lifestyles. The cumulative cost of these compensatory efforts is vast; yet in many respects they are only palliative.

The medical community now tells us that our modern diet of low-fiber, high-fat processed foods is disastrous to our health. But what exactly is the cost - in terms of hospital stays, surgeries, premature deaths, et cetera? A rough but conservative estimate runs into the tens of billions of dollars per year in North America alone.

At the forefront of the "wellness" movement are advocates of natural foods, exercise programs (including hiking and backpacking), herbalism, and other therapies that aim specifically to bring overcivilized individuals back in touch with the innate source of health within their own stressed and repressed bodies.

Current approaches in psychology aim to retrieve lost portions of the primitive psyche via "inner child" work, through which adults compensate for alienated childhoods; or men's and women's vision quests, through which civilized people seek to access the "wild man" or "wild woman" within.

All of these physically, psychologically, and even spiritually-oriented efforts are helpful antidotes for the distress of civilization. One must wonder, however, whether it wouldn't be better simply to stop creating the problems that these programs and therapies are intended to correct.


IV. Questions and Objections

Isn't civilization simply the inevitable expression of the evolutionary urge as it is translated through human society? Isn't primitivism therefore regressive?

We are accustomed to thinking of the history of Western civilization as an inevitable evolutionary progression. But this implies that all the world's peoples who didn't spontaneously develop civilizations of their own were less highly evolved than ourselves, or simply "backward". Not all anthropologists who have spent time with such peoples think this way. Indeed, according to the cultural materialist school of thought, articulated primarily by Marvin Harris, social change in the direction of technological innovation and social stratification is fueled not so much by some innate evolutionary urge as by crises brought on by overpopulation and resource exhaustion.

Wasn't primitive life terrible? Would we really want to go back to hunting and gathering, living without modern comforts and conveniences?

Putting an urban person in the wilderness without comforts and conveniences would be as cruel as abandoning a domesticated pet by the roadside. Even if the animal survived, it would be miserable. And we would probably be miserable too, if the accouterments of civilization were abruptly withdrawn from us. Yet the wild cousins of our hypothetical companion animal - whether a parrot, a canine, or a feline - live quite happily away from houses and packaged pet food and resist our efforts to capture and domesticate them, just as primitive peoples live quite happily without civilization and often resist its imposition. Clearly, animals (including people) can adapt either to wild or domesticated ways of life over the course of several generations, while adult individuals tend to be much less adaptable. In the view of many of its proponents, primitivism implies a direction of social change over time, as opposed to an instantaneous, all-or-nothing choice. We in the industrial world have gradually accustomed ourselves to a way of life that appears to be leading toward a universal biological holocaust. The question is, shall we choose to gradually accustom ourselves to another way of life - one that more successfully integrates human purposes with ecological imperatives - or shall we cling to our present choices to the bitter end?

Obviously, we cannot turn back the clock. But we are at a point in history where we not only can, but must pick and choose among all the present and past elements of human culture to find those that are most humane and sustainable. While the new culture we will create by doing so will not likely represent simply an immediate return to wild food gathering, it could restore much of the freedom, naturalness, and spontaneity that we have traded for civilization's artifices, and it could include new versions of cultural forms with roots in humanity's remotest past. We need not slavishly imitate the past; we might, rather, be inspired by the best examples of human adaptation, past and present. Instead of "going back", we should think of this process as "getting back on track".

Haven't we gained important knowledge and abilities through civilization? Wouldn't renouncing these advances be stupid and short-sighted?

If human beings are inherently mostly good, sociable, and creative, it is inevitable that much of what we have done in the course of the development of civilization should be worth keeping, even if the enterprise as a whole was skewed. But how do we decide what to keep? Obviously, we must agree upon criteria. I would suggest that our first criterion must be ecological sustainability. What activities can be pursued across many generations with minimal environmental damage? A second criterion might be, What sorts of activities promote - rather than degrade - human dignity and freedom?

If human beings are inherently good, then why did we make the "mistake" of creating civilization? Aren't the two propositions (human beings are good, civilization is bad) contradictory?

Only if taken as absolutes. Human nature is malleable, its qualities changing somewhat according to the natural and social environment. Moreover, humankind is not a closed system. We exist within a natural world that is, on the whole, "good", but that is subject to rare catastrophes. Perhaps the initial phases of civilization were humanity's traumatized response to overwhelming global cataclysms accompanying and following the end of the Pleistocene. Kingship and warfare may have originated as survival strategies. Then, perhaps civilization itself became a mechanism for re-traumatizing each new generation, thus preserving and regenerating its own psycho-social basis.

What practical suggestions for the future stem from primitivism? We cannot all revert to gathering and hunting today because there are just too many of us. Can primitivism offer a practical design for living?

No philosophy or "-ism" is a magical formula for the solution of all human problems. Primitivism doesn't offer easy answers, but it does suggest an alternative direction or set of values. For many centuries, civilization has been traveling in the direction of artificiality, control, and domination. Primitivism tells us that there is an inherent limit to our continued movement in that direction, and that at some point we must begin to choose to readapt ourselves to nature. The point of a primitivist critique of civilization is not necessarily to insist on an absolute rejection of every aspect of modern life, but to assist in clarifying issues so that we can better understand the tradeoffs we are making now, deepen the process of renegotiating our personal bargains with nature, and thereby contribute to the reframing of our society's collective covenants.

V. Some Concluding Thoughts

In any discussion of primitivism we must keep in mind civilization's "good" face - the one characterized (in Lewis Mumford's words) by the invention and keeping of the written record, the growth of visual and musical arts, the effort to widen the circle of communication and economic intercourse far beyond the range of any local community: ultimately the purpose to make available to all [people] the discoveries and inventions and creations, the works of art and thought, the values and purposes that any single group has discovered.

Civilization brings not only comforts, but also the opportunity to think the thoughts of Plato or Thoreau, to travel to distant places, and to live under the protection of a legal system that guarantees certain rights. How could we deny the worth of these things?

Naturally, we would like to have it all; we would like to preserve civilization's perceived benefits while restraining its destructiveness. But we haven't found a way to do that yet. And it is unlikely that we will while we are in denial about what we have left behind, and about the likely consequences of what we are doing now.

While I advocate taking a critical look at civilization, I am not suggesting that we are now in position to render a final judgment on it. It is entirely possible that we are standing on the threshold of a cultural transformation toward a way of life characterized by relatively higher degrees of contentment, creativity, justice, and sustainability than have been known in any human society heretofore. If we are able to follow this transformation through, and if we call the result "civilization", then we will surely be entitled to declare civilization a resounding success.

Copyright 1995 by Richard Heinberg

The Author's website is at: http://www.museletter.com/

MuseLetter is a monthly exploration of cultural renewal. Subscriptions: In the US: $15 per year; Canada and Mexico: $18 US per year; elsewhere: $20 US per yea. Send check or international money order to: Richard Heinberg, 1433 Olivet Road, Santa Rosa, California 95401.

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Bill Totten http://www.ashisuto.co.jp/english/

An interview with Richard Heinberg

by Aric McBay

inthewake.org (April 09 2004)

Richard Heinberg is the author of The Party's Over: Oil, War and the Fate of Industrial Societies, and Powerdown: Options and Actions for a Post-Carbon World. His website is www.museletter.com. I interviewed him on April 9 2004.



Aric McBay: How do you expect to see industrial collapse play out? That is, do you expect to see a gradual, although necessarily swift transition to near-universal organic agriculture and drastically reduced energy consumption? Or do you expect to see a more rapid collapse? Do you want to speculate here on what sort of time frame do you expect to see in terms of collapse?

Richard Heinberg: There are too many variables to enable a clear prediction. I would say that the most likely scenario would commence with an international crisis brought on by a meltdown of the US economy, beginning perhaps next year. This would result from unsustainable levels of debt, plus pressure from skyrocketing natural gas prices. Oil prices are likely to stay high, too. However, it is likely that petroleum will remain available at current rates of production for another three or four years before the oil downturn begins as a result of depletion.

Geopolitical instability will increase at this time, and that is the real wild card. I would like to see international cooperation to solve the world's energy problems, but the overwhelming likelihood is for resource wars to become more common and intense. The Middle East is likely to be a locus for such conflicts, but others could occur in Central Asia, Africa, and South America. Oil-producing nations will wish to control their resources, while importing nations will demand more. Meanwhile, importing nations will be vying with one another for whatever is available.

Things could drag on like this for a decade or two, or there could be a quick and nasty showdown. If major powers are drawn in and the conflict goes nuclear, all bets are off. That is not a distant possibility. It is truly frightening to see the sorts of weapons that are being developed these days - tactical nukes, genetic bioweapons, space-based weapons, and on and on. The generals and the arms manufacturers are preparing for one hell of a last act.


AM: How do you think that those in power will respond to attempts for communities to become more industrially independent, and so, more autonomous and detached from the goals and propagation of the power complex? It's fairly clear that shifting to a more sustainable economic system means bleeding power away from those in power, and having a less centralized system. Historically, those in power have used force and violence to suppress the development of alternatives like that. What can communities do about this?

RH: After a certain point, it will become almost impossible for central powers to offer much in the way of services for local communities; if the latter are able to fend for themselves, they may have a relatively free hand to do so. Look to the Great Depression for precedents: some communities developed their own currencies as a strategy to keep their economies alive. I don't think it would be advisable for communities to aggressively provoke central authorities, but the latter will be overwhelmed with other matters.


AM: Historically, the majority of energy and manufacturing in industrial society has been directly or indirectly contributing to or resulting from war. The military uses about a third of the US oil supply. Once available energy supplies are drastically reduced, do you think that the military will attempt to monopolize the output of sustainable power facilities, using "national security" or other excuses? For example, I have visions of a biodiesel powered Abrams tank <1>, and electric windmills spinning atop the Pentagon. What are appropriate responses to this, and how should it influence our approach in implementing new sources of energy? Are some sources of energy less vulnerable to military co-option than others?

RH: Renewable energy sources will, for the most part, be ineffective at powering the war machine. I would expect efforts to manufacture synfuels from coal, and perhaps some experiments with biofueled military vehicles. You're correct in assuming that whatever is available - electricity, food, water, machinery - will be commandeered by the military officers, but they will go after the materials and supplies they are most familiar with first. I can't think of any way to defend against this. These people are highly trained specialists in violence.


AM: How would you like see things pan out in the generations after collapse? Would you like to see a "Future Primitive" and a gradual shift away from civilization?

RH: Yes, of course. If we can salvage some of our humanity and most of nature, I can imagine future generations living in small, technologically modest communities. They would have memories of the events of the 21st century to serve as a cautionary tale embedded, no doubt, in new myths, so they would be highly motivated to keep population levels low - perhaps a few tens of millions of humans total, globally. Of course, life would go on, and there would be the inevitable mistakes and conflicts. But once the oil is gone I doubt if another generation will ever be capable of the exuberance and arrogance of ours.


AM: The longer industrial civilization persists, the more ecological destruction it will cause. And yet, non- (or post-) industrial peoples are especially in need of healthy bioregions to surive and thrive. Also, ecological "systems" have their own inherent worth. How do you address the conflict between the need for a gradual shift away from industrial civilization to save human lives in the short term, and the need to protect the biosphere, and hence the survivors of the collapse, in the long term?

RH: This is indeed a serious problem. As fossil fuels are depleted, humans will do what they can to survive - and that may include cutting down virtually every tree on Earth for firewood, destroying soils, draining aquifers, and so on.

How to stop this? One can only propose theoretical solutions, but these would require some forms of rational national and international authority. There would need to be cooperative agreements between nations, so that rich nations would cede wealth to poor nations. Governments would have to ration resources and manage reproduction rates. There are no doubt ways to do all of this, but the political will and courage required would be unprecedented. And it is difficult to reconcile the process with democratic ideals and notions of human rights (especially the right to reproduce).

Ultimately, however, the central authorities would have to self-destruct in favor of local autonomy, because the energy base would no longer be present to support long-distance systems of command and control.


AM: What do you think is the most important message that we should pass down to our descendants, to those who go after the collapse, about industrial civilization?

RH: My reflex is to say, "Don't try THAT again! See what happens?" I think they'll get the message on their own, though. On the other hand, I would like to see some things preserved. Even if the past 200 years were a ghastly ecological and demographic error on the part of our species, we did produce some great music and art, as well as a lot of neat scientific knowledge. I hope there are communities that devote themselves to conserving as much of that as possible.


Endnote

<1> Six months after I wrote this, the United States Marine Corps publicized their creation of a diesel-electrical hybrid Humvee for "reconnaissance, surveillance, and targeting". One news report suggested that "its diesel-electric hybrid powertrain could make environment-friendly [sic] fast attack vehicles the norm."

Copyright 2003-2004 inthewake.org, redistribution for for-profit uses prohibited without permission.

http://www.inthewake.org/heinberg1.html

Bill Totten http://www.ashisuto.co.jp/english/

The Original Affluent Society

by Marshall Sahlins

from Stone-Age Economics (Aldine de Gruyter, 1972)

Hunter-gatherers consume less energy per capita per year than any other group of human beings. Yet when you come to examine it the original affluent society was none other than the hunter's - in which all the people's material wants were easily satisfied. To accept that hunters are affluent is therefore to recognise that the present human condition of man slaving to bridge the gap between his unlimited wants and his insufficient means is a tragedy of modern times.

There are two possible courses to affluence. Wants may be "easily satisfied" either by producing much or desiring little. The familiar conception, the Galbraithean way - makes assumptions peculiarly appropriate to market economies: that man's wants are great, not to say infinite, whereas his means are limited, although improvable; thus, the gap between means and ends can be narrowed by industrial productivity, at least to the point that "urgent goods" become plentiful. But there is also a Zen road to affluence, departing from premises somewhat different from our own: that human material wants are finite and few, and technical means unchanging but on the whole adequate. Adopting the Zen strategy, a people can enjoy an unparalleled material plenty - with a low standard of living.

That, I think, describes the hunters. And it helps explain some of their more curious economic behaviour: their "prodigality" for example - the inclination to consume at once all stocks on hand, as if they had it made. Free from market obsessions of scarcity, hunters' economic propensities may be more consistently predicated on abundance than our own.

Destutt de Tracy, "fish-blooded bourgeois doctrinaire" though he might have been, at least compelled Marx's agreement that "in poor nations the people are comfortable", whereas in rich nations, "they are generally poor".


Sources of the Misconception

"Mere subsistence economy", "limited leisure save in exceptional circumstances", "incessant quest for food", "meagre and relatively unreliable" natural resources, "absence of an economic surplus", "maximum energy from a maximum number of people" - so runs the fair average anthropological opinion of hunting and gathering.

The traditional dismal view of the hunters' fix ... goes back to the time Adam Smith was writing, and probably to a time before anyone was writing. Probably it was one of the first distinctly neolithic prejudices, an ideological appreciation of the hunter's capacity to exploit the earth's resources most congenial to the historic task of depriving him of the same. We must have inherited it with the seed of Jacob, which "spread abroad to the west, and to the east, and to the north", to the disadvantage of Esau who was the elder son and cunning hunter, but in a famous scene deprived of his birthright.

Current low opinions of the hunting-gathering economy need not be laid to neolithic ethnocentrism, however. Bourgeois ethnocentrism will do as well. The existing business economy ... will promote the same dim conclusions about the hunting life.

Is it so paradoxical to contend that hunters have affluent economies, their absolute poverty notwithstanding? Modern capitalist societies, however richly endowed, dedicate themselves to the proposition of scarcity. Inadequacy of economic means is the first principle of the world's wealthiest peoples.

The market-industrial system institutes scarcity, in a manner completely unparalleled and to a degree nowhere else approximated. Where production and distribution are arranged through the behaviour of prices, and all livelihoods depend on getting and spending, insufficiency of material means becomes the explicit, calculable starting point of all economic activity. The entrepreneur is confronted with alternative investments of a finite capital, the worker (hopefully) with alternative choices of remunerative employ, and the consumer ... Consumption is a double tragedy: what begins in inadequacy will end in deprivation. Bringing together an international division of labour, the market makes available a dazzling array of products: all these Good Things within a man's reach - but never all within his grasp. Worse, in this game of consumer free choice, every acquisition is simultaneously a deprivation for every purchase of something is a foregoing of something else, in general only marginally less desirable, and in some particulars more desirable, that could have been had instead.

That sentence of "life at hard labour" was passed uniquely upon us. Scarcity is the judgment decreed by our economy ... And it is precisely from this anxious vantage that we look back upon hunters. But if modern man, with all his technological advantages, still hasn't got the wherewithal, what chance has the naked savage with his puny bow and arrow? Having equipped the hunter with bourgeois impulses and palaeolithic tools, we judge his situation hopeless in advance.

Yet scarcity is not an intrinsic property of technical means. It is a relation between means and ends. We should entertain the empirical possibility that hunters are in business for their health, a finite objective, and that bow and arrow are adequate to that end.

The anthropological disposition to exaggerate the economic inefficiency of hunters appears notably by way of invidious comparison with neolithic economies. Hunters, as Lowie put it blankly, "must work much harder in order to live than tillers and breeders" <1>. On this point evolutionary anthropology in particular found it congenial, even necessary theoretically, to adopt the usual tone of reproach. Ethnologists and archaeologists had become neolithic revolutionaries, and in their enthusiasm for the Revolution spared nothing in denouncing the Old (Stone Age) Regime. It was not the first time philosophers would relegate the earliest stage of humanity rather to nature than to culture. ("A man who spends his whole life following animals just to kill them to eat, or moving from one berry patch to another, is really living just like an animal himself" <2>). The hunters thus downgraded, anthropology was freer to extol the Neolithic Great Leap Forward: a main technological advance that brought about a "general availability of leisure through release from purely food-getting pursuits" <3,>.

In an influential essay on "Energy and the Evolution of Culture", Leslie White explained that the neolithic generated a "great advance in cultural development ... as a consequence of the great increase in the amount of energy harnessed and controlled per capita per year by means of the agricultural and pastoral arts" <5>. White further heightened the evolutionary contrast by specifying human effort as the principal energy source of palaeolithic culture, as opposed to the domesticated plant and animal resources of neolithic culture. This determination of the energy sources at once permitted a precise low estimate of hunters' thermodynamic potential - that developed by the human body: "average power resources" of one twentieth horse power per capita <5> - even as, by eliminating human effort from the cultural enterprise of the neolithic, it appeared that people had been liberated by some labour-saving device (domesticated plants and animals). But White's problematic is obviously misconceived. The principal mechanical energy available to both palaeolithic and neolithic culture is that supplied by human beings, as transformed in both cases from plant and animal sources, so that, with negligible exceptions (the occasional direct use of non-human power), the amount of energy harnessed per capita per year is the same in palaeolithic and neolithic economies - and fairly constant in human history until the advent of the industrial revolution.


Marvelously Varied Diet

Marginal as the Australian or Kalahari desert is to agriculture, or to everyday European experience, it is a source of wonder to the untutored observer "how anybody could live in a place like this". The inference that the natives manage only to eke out a bare existence is apt to be reinforced by their marvelously varied diets. Ordinarily including objects deemed repulsive and inedible by Europeans, the local cuisine lends itself to the supposition that the people are starving to death.

It is a mistake, Sir George Grey wrote, to suppose that the native Australians "have small means of subsistence, or are at times greatly pressed for want of food". Many and "almost ludicrous" are the errors travellers have fallen into in this regard: "They lament in their journals that the unfortunate Aborigines should be reduced by famine to the miserable necessity of subsisting on certain sorts of food, which they have found near their huts; whereas, in many instances, the articles thus quoted by them are those which the natives most prize, and are really neither deficient in flavour nor nutritious qualities". To render palpable "the ignorance that has prevailed with regard to the habits and customs of this people when in their wild state", Grey provides one remarkable example, a citation from his fellow explorer, Captain Stuart, who, upon encountering a group of Aboriginals engaged in gathering large quantities of mimosa gum, deduced that the "unfortunate creatures were reduced to the last extremity, and, being unable to procure any other nourishment, had been obliged to collect this mucilaginous". But, Sir George observes, the gum in question is a favourite article of food in the area, and when in season it affords the opportunity for large numbers of people to assemble and camp together, which otherwise they are unable to do. He concludes:

"Generally speaking, the natives live well; in some districts there may be at particular seasons of the year a deficiency of food, but if such is the case, these tracts are, at those times, deserted. It is, however, utterly impossible for a traveller or even for a strange native to judge. whether a district affords an abundance of food, or the contrary ... But in his own district a native is very differently situated; he knows exactly what it produces, the proper time at which the several articles are in season, and the readiest means of procuring them. According to these circumstances he regulates his visits to different portions of his hunting ground; and I can only say that I have always found the greatest abundance in their huts" <7,>.

In making this happy assessment, Sir George took special care to exclude the lumpen-proletariat aboriginals living in and about European towns <8>. The exception is instructive. It evokes a second source of ethnographic misconceptions: the anthropology of hunters is largely an anachronistic study of ex-savages - an inquest into the corpse of one society, Grey once said, presided over by members of another.


"A Kind of Material Plenty"

Considering the poverty in which hunters and gatherers live in theory, it comes as a surprise that Bushmen who live in the Kalahari enjoy "a kind of material plenty", at least in the realm of everyday useful things, apart from food and water:

"As the !Kung come into more contact with Europeans - and this is already happening - they will feel sharply the lack of our things and will need and want more. It makes them feel inferior to be without clothes when they stand among strangers who are clothed. But in their own life and with their own artifacts they were comparatively free from material pressures. Except for food and water (important exceptions!) of which the Nyae Nyae !Kung have a sufficiency - but barely so, judging from the fact that all are thin though not emaciated - they all had what they needed or could make what they needed, for every man can and does make the things that men make and every woman the things that women make ... They lived in a kind of material plenty because they adapted the tools of their living to materials which lay in abundance around them and which were free for anyone to take (wood, reeds, bone for weapons and implements, fibres for cordage, grass for shelters), or to materials which were at least sufficient for the needs of the population ... The !Kung could always use more ostrich egg shells for beads to wear or trade with, but, as it is, enough are found for every woman to have a dozen or more shells for water containers - all she can carry - and a goodly number of bead ornaments. In their nomadic hunting-gathering life, travelling from one source of food to another through the seasons, always going back and forth between food and water, they carry their young children and their belongings. With plenty of most materials at hand to replace artifacts as required, the !Kung have not developed means of permanent storage and have not needed or wanted to encumber themselves with surpluses or duplicates. They do not even want to carry one of everything. They borrow what they do not own. With this ease, they have not hoarded, and the accumulation of objects has not become associated with status" <9>.

In the nonsubsistence sphere, the people's wants are generally easily satisfied. Such "material plenty" depends partly upon the ease of production, and that upon simplicity of technology and democracy of property. Products are homespun: of stone, bone, wood, skin - materials such as "lay in abundance around them". As a rule, neither extraction of the raw material nor its working up take strenuous effort. Access to natural resources is typically direct - "free for anyone to take" - even as possession of the necessary tools is general and knowledge of the required skills common. The division of labour is likewise simple, predominantly a division of labour by sex. Add in the liberal customs of sharing, for which hunters are properly famous, and all the people can usually participate in the going prosperity, such as it is.

For most hunters, such affluence without abundance in the nonsubsistence sphere need not be long debated. A more interesting question is why they are content with so few possessions - for it is with them a policy, a "matter of principle" as Gusinde <10> says, and not a misfortune.

Want not, lack not. But are hunters so undemanding of material goods because they are themselves enslaved by a food quest "demanding maximum energy from a maximum number of people", so that no time or effort remains for the provision of other comforts? Some ethnographers testify to the contrary that the food quest is so successful that half the time the people seem not to know what to do with themselves. On the other hand, movement is a condition of this success, more movement in some cases than others, but always enough to rapidly depreciate the satisfactions of property. Of the hunter it is truly said that his wealth is a burden. In his condition of life, goods can become "grievously oppressive", as Gusinde observes, and the more so the longer they are carried around. Certain food collectors do have canoes and a few have dog sleds, but most must carry themselves all the comforts they possess, and so only possess what they can comfortably carry themselves. Or perhaps only what the women can carry: the men are often left free to reach to the sudden opportunity of the chase or the sudden necessity of defence. As Owen Lattimore wrote in a not too different context, "the pure nomad is the poor nomad". Mobility and property are in contradiction.

That wealth quickly becomes more of an encumbrance than a good thing is apparent even to the outsider. Laurens van der Post was caught in the contradiction as he prepared to make farewells to his wild Bushmen friends:

"This matter of presents gave us many an anxious moment. We were humiliated by the realisation of how little there was we could give to the Bushmen. Almost everything seemed likely to make life more difficult for them by adding to the litter and weight of their daily round. They themselves had practically no possessions: a loin strap, a skin blanket and a leather satchel. There was nothing that they could not assemble in one minute, wrap up in their blankets and carry on their shoulders for a journey of a thousand miles. They had no sense of possession" <11>.

Here then is another economic "peculiarity" ... some hunters at least, display a notable tendency to be sloppy about their possessions. They have the kind of nonchalance that would be appropriate to a people who have mastered the problems of production, even as it would be maddening to a European:

"They do not know how to take care of their belongings. No one dreams of putting them in order, folding them, drying or cleaning them, hanging them up, or putting them in a neat pile. If they are looking for some particular thing, they rummage carelessly through the hodgepodge of trifles in the little baskets. Larger objects that are piled up in a heap in the hut are dragged hither and thither with no regard for the damage that might be done them. The European observer has the impression that these (Yahgan) Indians place no value whatever on their utensils and that they have completely forgotten the effort it took to make them. Actually, no one clings to his few goods and chattels which, as it is, are often and easily lost, but just as easily replaced ... The Indian does not even exercise care when he could conveniently do so. A European is likely to shake his head at the boundless indifference of these people who drag brand-new objects, precious clothing, fresh provisions and valuable items through thick mud, or abandon them to their swift destruction by children and dogs ... Expensive things that are given them are treasured for a few hours, out of curiosity; after that they thoughtlessly let everything deteriorate in the mud and wet. The less they own, the more comfortable they can travel, and what is ruined they occasionally replace. Hence, they are completely indifferent to any material possessions" <10>.

The hunter, one is tempted to say, is "uneconomic man". At least as concerns nonsubsistence goods, he is the reverse of that standard caricature immortalised in any General Principles of Economics, page one. His wants are scarce and his means (in relation) plentiful. Consequently he is "comparatively free of material pressures", has "no sense of possession", shows "an undeveloped sense of property", is "completely indifferent to any material pressures", manifests a "lack of interest" in developing his technological equipment.

In this relation of hunters to worldly goods there is a neat and important point. From the internal perspective of the economy, it seems wrong to say that wants are "restricted", desires "restrained", or even that the notion of wealth is "limited". Such phrasings imply in advance an Economic Man and a struggle of the hunter against his own worse nature, which is finally then subdued by a cultural vow of poverty. The words imply the renunciation of an acquisitiveness that in reality was never developed, a suppression of desires that were never broached. Economic Man is a bourgeois construction - as Marcel Mauss said, "not behind us, but before, like the moral man". It is not that hunters and gatherers have curbed their materialistic "impulses"; they simply never made an institution of them. "Moreover, if it is a great blessing to be free from a great evil, our [Montagnais] Savages are happy; for the two tyrants who provide hell and torture for many of our Europeans, do not reign in their great forests, - I mean ambition and avarice ... as they are contented with a mere living, not one of them gives himself to the Devil to acquire wealth" <12>.


Subsistence

When Herskovits was writing his Economic Anthropology (1958), it was common anthropological practice to take the Bushmen or the native Australians as "a classic illustration of a people whose economic resources are of the scantiest", so precariously situated that "only the most intense application makes survival possible". Today the "classic" understanding can be fairly reversed - on evidence largely from these two groups. A good case can be made that hunters and gatherers work less than we do; and, rather than a continuous travail, the food quest is intermittent, leisure abundant, and there is a greater amount of sleep in the daytime per capita per year than in any other condition of society.

The most obvious, immediate conclusion is that the people do not work hard. The average length of time per person per day put into the appropriation and preparation of food was four or five hours. Moreover, they do not work continuously. The subsistence quest was highly intermittent. It would stop for the time being when the people had procured enough for the time being, which left them plenty of time to spare. Clearly in subsistence as in other sectors of production, we have to do with an economy of specific, limited objectives. By hunting and gathering these objectives are apt to be irregularly accomplished, so the work pattern becomes correspondingly erratic.

As for the Bushmen, economically likened to Australian hunters by Herskovits, two excellent recent reports by Richard Lee show their condition to be indeed the same <14,>. Lee's research merits a special hearing not only because it concerns Bushmen, but specifically the Dobe section of !Kung Bushmen, adjacent to the Nyae Nyae about whose subsistence - in a context otherwise of "material plenty" - Mrs Marshall expressed important reservations. The Dobe occupy an area of Botswana where !Kung Bushmen have been living for at least a hundred years, but have only just begun to suffer dislocation pressures.

Despite a low annual rainfall (6 to 10 inches), Lee found in the Dobe area a "surprising abundance of vegetation". Food resources were "both varied and abundant", particularly the energy-rich mangetti nut - "so abundant that millions of the nuts rotted on the ground each year for want of picking" <15>.

The Bushman figures imply that one man's labour in hunting and gathering will support four or five people. Taken at face value, Bushman food collecting is more efficient than French farming in the period up to World War II, when more than twenty per cent of the population were engaged in feeding the rest. Confessedly, the comparison is misleading, but not as misleading as it is astonishing. In the total population of free-ranging Bushmen contacted by Lee, 61 per cent (152 of 248) were effective food producers; the remainder were too young or too old to contribute importantly. In the particular camp under scrutiny, 65 per cent were "effectives". Thus the ratio of food producers to the general population is actually 3: