So how are we going to get out of this recession thing, then? If we just cut interest rates to zero and crank up the printing presses, will everything return to being fine and dandy? Well, possibly, although I have to say that I personally severely doubt it. Such alarmingly simplistic Keynesian policies might help us along the …
"So, according to Tim modern apaitalism does not "immiserate" the workers, indeed it's moderns capitalism/capitalists that ensure we have a '1.8-2 per cent increase in the average per capita income each year'. But whn I left the UK I thought that the retail prices index was measuring effective infation at around 5%. Which surely means that each year your actual buying power reduces by around 3%. Innit?"
The 1.8-2 % number of a post inflation one. Yes, certainly, there are years when it doesn't happen but you can pretty much draw a straight line (even the Depression comes out as a little wobble if you do it year by year) for real incomes from 1800 or so to today, roughly that period of something approaching liberal capitalism (in a wide sense here), at that gradient and you won't be far out.
Of course, it's not so much "capitalism" per se that causes this growth in real incomes. It's the onward march of technology. We get more efficient at making things all the time, thus we have resources to do other things as well: having two things instead of one is a useful definition of increased material wealth. The influence of capitalism is that, at least in relation to any other system we've tried, capitalism provides more incentive to try to create those new technologies and more incentives to use them when they've been invented/developed.
"Principle: deregulation does not equal acceptance and justification of irresponsibilities."
Overwhelming amounts of empirical evidence indicate exactly the contrary. More accurately though - in the absence of regulation there is no measure of "responsibility" that is not meaningless.
@Matt Bryant (first post)
If that were true then the supermarkets would not be giving the line "We can't get the staff".
If you can't get staff, it's because you aren't paying a reasonable wage.
PS I wonder if, now that there's a lot of RIF going on, whether the salaries of managers at a high enough level not to be "reducable" (e.g. you can't have 80% of a CIO) will reduce because they are not in charge of such a large company any more?
RE: MArk - @Matt Bryant (first post)
Many years ago as a struggling student, amongst other more reputable means of employment, I also worked in a supermarket for a well-known chain. In my experience, it is a complete fallacy when supermarkets claim they can't get the staff, the reality is that they do not want to employ more so they can maximise profits or prevent a loss. I have seen applicants turned away from a store that regularly trotted out the same excuse. The reason is staff numbers are carefully budgetted to meet a possible maximum at any given time. For example, they calculate that x number of customers will hit the store on an average summer sunday, and hence will schedule y number of employees. Now, seeing as they look at past market figures and calculate an average, there will be times they have an excess of staff and times they have less than are really needed, but the store will be set a budget by the area manager to meet, hence the cry of "We can't get the staff". No area manager will actually staff a store with 110% staff they actually require to meet the maximum as they are targeted with reducing cost and maximising profits - so what if the odd customer has to be told "We can't get the staff"? We're used to queuing in the UK, and you went into the supermarket in the first place because it was convenient and cheap.
The reality I saw was the only time a store was ever staffed to the max was when it opened and they needed to project an image of high staff levels, and then I have seen them bus in temps for a fortnight before dropping back into the "average customer numbers expected" staffing plan.
@Matt (re Matt first post)
If that's true, then the supermarkets are lying and that there is no way to increase employment by employing more people at lower pay: the companies do not WANT more people at any price.
Which is twice as bad as if they were telling the truth and couldn't get people in.
Former Merchant Bankers as National Reconstruction Material
@ Paul (posted Monday 29th December 2008 14:35 GMT )
"Or the west could simply say to China "we're not paying you any of the trillions of dollars we owe you so there!". And then try to win the war."
Item One: Bookmark http://www.worldreports/news and check back every week or ten days. You too shall then understand that what you so astutely observed from the bleachers is already a fait accompli for the filthy world finance brutes a-rockin' on the ol' pigskin griiron of The Financial Industry.
Item Two: Also one finds that the atmosphere Out There is turned deadly for all such who, um, did the Wrong Kind of Business with indeed some of the Wrong Kind of People. Indeed, some few second- and third-tier Banksters from Berne and Zurich on down to Wall Street and The City of London have been found "suicided" in various curious ways, shall we just tag the deed, at their desks...
So: Compounding the above items, one readily deduces that the Humor Dividend accruing to the Heavenly Accounts of those who astutely peruse that Honest Financial News Source of Mr. Christopher Story FRSA might just include ones' realizing the following:
Item Three: A fine reading of the reportedly strong desire of the Chicago forces (including "the Daley Group") for recovery of previously invested liquid assets (such as suitcases full of large cash and the like) might these days just lend new meaning to the old Lesbian Separatist riddle /schtick/:
Q: "Delicious latte, my sweet, by the way. So riddle me this: How many Former Merchant Bankers must one employ in order to properly re-tile all our lavatories?"
A: "Um, only one per lav, Beloved, if we slice 'em thin enough... The studio kiln is preheating nicely today, by the way. Biscotti?"
Um, mine's the one with the pockets stuffed top-full of beans, bullets and bullion... No need to rise, gents, but thankee; I'll get it mese'f... Expect much shrieking, weeping, wailing, hair-tearing, tooth-gnashing, alibi-polishing, excuse-begging etc before this man-made kerfluffleization of greed is all done with... Gottit - peace; I'm out.
The "All Hands" icon, though, because to all creditable indicators' appearances, this is no drill. The International Settlements due China from the USDC Jurisdiction per one longstanding International Court of Justice decree have STILL at this writing not been paid (last I knew as of yesterday) by the Bush Fraudulent Finance Gang; ergo this assertion of mine is not paranoid fantasy at all, and is in fact NO DRILL. (Screw the tinfoil-sneery punditries of the Mainstream Murdoch Media hacksterz. They'll all learn summat once their paycheck fails to cash one fine day...)
Exit amid a rising crescendo of approaching klaxophonic reverberations and the looming thud-thud-thud-thud! of all those derivatives-based collateralized debt obligation contract futures casino documents and "Default Swap" agreements long since past due, all falling through the world's roof at well past free-fall speed, carrying every floor below straight down, pancake-like, to the Basement of Hell amid LOTS of Toxic Fallout, Blue Smoke and Slightly Twisted Mirrors.
There is a solution with a place for the unemployed to work
There is actually a simple and practical answer if we support it.
The world is demanding a green energy revolution. There are millions of manufacturing employees, some nice large vacant factories and a lot of managers available for duty. There'd be even more resources and less opposition too if the US auto industry has got what is deserved from its (lack of) efforts in this area.
With millions of talented employees going cheap and demand for a truely green future at an all time high and rising fast, the green revolution could only move in one direction. Wages would rise and increases in stock prices could quickly see everyone earning more than they did in the auto and banking sectors. Something like the .com bonanza. This money would radiate to other industries and so those that got us into this mess would have got us out of it.
Even if another bubble is created, at least we'd be left with massively improved energy and transport infrastructure when it bursts. The great irony being that it was those working for comps that tore that infrastructure apart or prevented any progress on energy policy that would be the ones that rebuilt it and changed it whilst fixing the economy (at least temporarily) in the process.
Best of all, this energy revolution would precipitate a green transport revolution which would tightly nail shut the coffins of auto makers that continued to obstruct progress and would reward those that moved in the right direction. Just good old market forces.
Entrepreneurs would indeed be the ones to take these unusued resourced and combine them. So capitalism would be doing just great. Or would it?
So, this is pretty straightforward. Why weren't the auto makers allowed to go bust and the employees reassigned to great new green energy comps in retooled auto factories?
Well, perhaps it's because green = ethical = idealistic = COMMUNIST (said in a loud, deep, booming, echoy voice that seems to add an exclamation mark and a disgusted tone to the word). In the eyes of the west any ethical thinking is seen as anti-capitalist and therefore anti-american and therefore out of the question. Who cares about anything other than profits right? If you're an investor, all you care about is returns. Right?
So, with enormous irony, we bail out the bastards that destroyed the transport infrastructure and replaced it with an unsustainable transport infrastructure twinned with an unsustainable energy infrastructure whilst leaving the managers from the banking industy twiddling their thumbs as the economy tanks when they could all be dragging it out of the malaise by building a better future.
If we don't want to reassign the people working for companies that are making things worse (via creation of a major new competitive industry to mop them up - thus they have been 'reassigned') to a new industry to make things better, then we cannot be surprised when the world finds somewhere else to do the work that is being demanded. That probably means the far east also dominating the next great boom. RENEWABLE energy and transport. Capitalism is exactly what's driving money to other economies. Some in the west are so keen to pretend to have the perfect model, that doing something that would actually benefit the country or wider world cannot be allowed to happen if it throws the model into doubt. The model broke. It's sad that a fear of what ethics will do to the already discredited model prevents action that would solve most of the problems that brought about the model's failure. Unsustainable practices in a disposable world.
Get those bankers and SUV/Pickup builders working on a total infrastructure revolution and something very good will have come from this in a rather poetic fashion. Something that leaves a lasting positive legacy with a paradigm shift in consumer and business ethics. The future looks brighter already doesn't it? -Unless you run an oil comp or an SUV parts plant, etc etc etc or associated business!!! Oh shit. That's everyone against that idea then!
Except perhaps those that see an opportunity. Someone mentioned entrepreneurs. Let's hope they're not too patriotic as that would conflict with capitalism right now. If they were real capitalists, they wouldn't be investing in the west after all. And besides, if all they care about is returns, then that means adopting an unthinkable tactic of the enemy. Ethics. A green revolution and a change in infrastructure that seems to be against the national interests any country whose largest comp is an oil comp! Lol.
You don't need much tarmac for railways. Or any fuel oil once there are plenty of solar, wind-farms, tidal energy, etc. With a mass transit infrastructure like that torn down in the mid 20th century by a recently bailed out auto maker , we won't need much oil for cars either as there'll be less of those and those there are will be both smaller and more efficient with a corresponding decrease in the need for plastics, fuel, tyres, road repairs......... Less cars means less jams means less wasted energy...less emissions...slowed global warming... The cycle of things getting worse could be reversed just by letting the auto comps fail and putting the unemployed to work on a green energy revolution which would result in US energy independance which apparently IS in the national interest. A stronger economy from domination of a new great industry. Ditto.
Perhaps dubya already allowed the opportunity to pass. Someone will take it and collect the returns. The west will have passed up the greatest investment in a long time just to protect an unsustainable past and the delusion that capitalism was perfect. How ironic.
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