Category: Capital

The Golden Calf and Trickle-Up Economics

When Moses went up Mount Sinai to get the Ten Commandments (Exodus, Ch. 19 ff.), he took a bit longer than expected. The people, concerned that Moses might not actually come back, decided to make their own God to worship, and created a golden calf, from the assorted gold of the people there gathered. ‘These are they Gods, O Israel, that have brought thee out of the land of Egypt,’ said Aaron, and by all accounts they had something of a party to celebrate. The story always made me think about the utility of the calf; it was very expensive. The economic cost of the thing was immense. And while the yield – being metaphysical – was literally incalculable (what price redemption and/or salvation!), surely there were cheaper ways to fashion a God? What about a nice painted papier-maché calf? That would have looked just as good.

Let’s say for the sake of argument that there were a thousand people there, and each had ten units of value. If half of those units of value were offered up to the communal icon building exercise, then the collective wealth of the group was now reduced by half. That value has now – for all earthly purposes – vanished. It’s gone. It can be recovered, but biblical wrath would surely follow. A lot of effort went into creating that calf, it had better be worth it.

Now consider the wealthy family paying forty thousand dollars to fly first class from London to New York. This family has a lot of money. Let’s say it’s $100m. They could do this a hundred times, and still have $96m left. So they don’t really care. If asked about their conscience, they might say something to the effect of ‘trickle down economics’. The logic runs something like this: of the forty thousand dollars, some contributes to the cost of the flight – along with the other two-hundred-odd people on the plane, they’re all contributing in a relative way to the fuel, the cost of airplane maintenance, the cost of security, the cost of airport services, luggage handling, food, flight attendants, pilots, rights for on-demand entertainment channels, and so on. The total cost of that will still, however, be less than the total cost of the tickets.

This rich family have paid more than their share, in order to get the nice plush seats at the front of the plane. The moral rationale remains that the balance of their ticket price will find its way into the pockets of other people less fortunate, by being distributed through the corporate system into other workers’ pockets, sometimes as sub-contractors, perhaps as wages, perhaps as services in kind, perhaps as government services funded by corporation tax receipts. That’s trickle-down economics.

Let’s say there are another two hundred people on the plane, each of whom has paid $1,000 each for their ticket. That’s a total of $240,000 for the flight. Let’s say each flight like this costs the airline company $200,000 for everything, including a contribution towards company overheads like marketing, CEO bonuses and so on. This means that the company will make $40,000 profit on this flight. Where does that money go?

Increasingly, the money is beginning to accumulate into funds, high net worth individuals, and ‘off-shore instruments’ that protect that money. A larger and larger portion of the world’s GDP – around 10%, or $7 trillion according to the IMF – is held ‘offshore’. It is too much money to spend, and so it sits there, slowly – very slowly – being chipped away at by agents, bankers, insurance salesmen and other financial intermediaries tasked with maintaining the advantages of the elite.

It represents incredible waste. The money fails to trickle down, but remains suspended in untouchable isolation, a golden calf for the twenty-first century. We dare not touch it – last the wrath of our modern day secular theology be loosed upon us. This is the central suggestion of an upcoming book by Eugene McCarraher, called The Enchantments of Mammon. Having not yet seen the book, I would anticipate that it follows on the work of Carl Schmitt and Giorrio Agamben, and the concept of secular theologies that have so dominated the later twentieth century. ‘Far from displacing religions, as has been supposed,’ the blurb puts it, ‘capitalism became one, with money as its deity.’ We shall see!

Beautiful Ideas Which Kill: Accelerationism, Futurism and Bewilderment

futurist soccer player
Umberto Boccioni’s Dynamism of a Soccer Player, 1913 (MOMA). Saw this on my visit in December 2017, it’s a provocative piece.

In trying to construct a progressive, positive view of the future, and design political structures that facilitate such outcomes, there are many ideas. These are the ideas of political philosophy, but they are also the ideas of sociology, economics, psychology, art and literature. When we think of writers like Karl Marx, Ayn Rand, Sigmund Freud, James Joyce – all of them could in some sense be considered to have made significant contributions in several of those fields. My own attempts to understand State Legitimacy, how the state’s claim to legitimacy can be established and maintained, is in truth a combination of those things as well. Ultimately, all of these pursuits fall back on critical theory: that field of study that attempts to understand who we are as peoples, as cultures. The Italian Futurists, from the first half of the twentieth century, and the (new) accelerationists, from the first fifteen or so years of the twenty-first century, each had a vision. And each was in some ways nasty. Continue reading “Beautiful Ideas Which Kill: Accelerationism, Futurism and Bewilderment”

Property Developers and the Irish State

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Dr Hans Sluga: a thoughtful man, and not a criminal, even though his bio photo looks like he might be.

Dr Hans Sluga is William and Trudy Ausfahl Professor of Philosophy at UC Berkeley, and concerned about the health of our politics. I say our – his concerns are particularly American, but certainly not confined to America. In a recent interview with the gregarious host of Stanford’s Entitled Opinions, Robert Harrison, he extended his comments on the presidency of Donald Trump from a recent lecture Between Populism and Plutocracy. He was critical of both Trump’s populism and tendency to favour the wealth wealthy through tax breaks and reducing regulatory constraints, but particularly concerned with the real estate factor. ‘We have underestimated the political significance of real estate in our world,’ he said.

Continue reading “Property Developers and the Irish State”

Galadriel’s Inversion

Cate Blanchett
Cate Blanchett’s Galadriel from the Lord of The Rings: The Fellowship of the Ring (Dir. Peter Jackson, 2001)

On the day when Apple are supposed to be launching a new iPhone with facial scanning capability, the Guardian has delightfully timed a piece warning of the dangers of the technology. Its functions potentially extend to predicting sexual orientation, political disposition, or nefarious intent. What secrets can remain in the face of this extraordinary power! Indeed, it’s two years ago since I heard Martin Geddes talking about people continuing to wear face masks in Hong Kong not because of the smog, but to avoid facial scanning technologies deployed by an overbearing security apparatus. There’s no hiding from the data, no forgetting.

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Neonihilism and the Failure of Liberalism

Do the disaffected know what they want? Agency is one thing: leadership and direction is another.
Do the disaffected know what they want? Agency is one thing: leadership and direction is another.

Ross Douthat in today’s New York Times declares our time a crisis for liberalism, the left having ‘lost its way’, in the aftermath of the election of Donald Trump. It’s been a popular theme. In 1969, Ted Lowi declared the end of liberalism, in favour of interest group liberalism, in part a kind of elaboration on Eisenhower’s theme of the military-industrial complex. The liberalism of which we speak has long been defined in terms of economics and economic goods, how the distribution of resources and the freedom that comes with fair access to those resources, can allow mankind to flourish. Friedman’s classic Capitalism and Freedom from 1962 defined the concept, which was ultimately routed in eighteenth century enlightenment thinking, and in particular the French Revolution. Its progression through International Law and the Universal Declaration of Human Rights in the twentieth century brought at its end an essential global consensus: Liberal Democracy was it. This was the end of history. Continue reading “Neonihilism and the Failure of Liberalism”

The Data Commodity: Fetish or Fiction?

Shoshana Zuboff
Shoshana Zuboff, Charles Edward Wilson Professor of Business Administration at the Harvard Business School

Shoshana Zuboff’s ‘Big Other’ and ‘Surveillance Capitalism’ as Future Economic Models

Shoshana Zuboff’s recently published article on what she has termed Information Civilization is a compact and helpful analysis of the kind of internet economies that are emerging in the early twenty-first century. This blog post is a commentary on that text. She takes Google’s Chief Economist Hal Varian as her foil, referencing his two articles Computer Mediated Transactions (2010) and Beyond Big Data (2013).

Continue reading “The Data Commodity: Fetish or Fiction?”

Postcapitalism and the State

postcapitalism 2
The graphics on the Guardian piece deserve reproduction. Mason argues no less than the evolution of a new kind of human, based on a ‘postcapitalist’ future.

Paul Mason‘s imminent book ‘Postcapitalism’ is plugged this weekend in the Guardian with an extended essay on the subject.  Accompanied by some excellent graphics, some of which I’ve reproduced here, the broad thesis is that capitalism as we know it is ending, and that we are moving into a ‘sharing economy’, but at its heart is a Marxist argument about information and power.  Mason goes so far as to argue that the changes we are witnessing herald the arrival of a new kind of human being, a sort of cocktail of Marxist proletarianism, social Darwinism, and Kurzweilian posthumanism.

Continue reading “Postcapitalism and the State”