The Ruling Class's Sickness Unto Death

All ruling classes are the same.  They all suffer under the delusion that their particular power and wisdom is needed to bring order to a chaotic world.  They experience themselves as parents trying to control unruly children.

So in Europe the ruling class decided after World War II that it needed to create a new, wise, continental over-class that would prevent another outbreak of dangerous nationalism.  It slowly built up a vast oligarchy of the great and the good to rule over the crazed plebs.  After all, if the German people could vote for a Hitler once, they could do it again.  So a wise elite would write the laws and work behind the scenes to neuter the passions of the masses.

(It did not stop to think that Nazism and Fascism might be practical responses to the failures of the old regimes and their proud elites.)

Well, we now see what has happened in Europe.  Even apart from the clumsy and corrupt European Commission in Europe which rules without the consent of the governed, we have the abominable Euro, the currency without a country that is tearing Europe apart.  It is, of course, appropriate that it is a failed currency that is doing the job of destruction because it has been the policy of inflated and devalued currencies that has been the universal resort of the 20th century educated ruling class when caught in a jam.  The ruling class built a huge administrative government to deliver countless benefits to the people to keep them off the streets, but it needed a constant resort to the thievery of inflation to clean up its economic messes.

In the United States the problems are similar, but different.  Here the ruling class has been executing on a similar plan of administrative supremacy, but has to have constant resort to the tribal instincts of race, gender, and class in order to cudgel the ordinary voter into maintaining the status quo and the ruling class in power.   The elite that stands for progress and enlightenment can only stay in power by resorting to the crudest appeals to race and difference.

It is well to turn back the clock and remember what the educated class originally intended.  It thought of itself as advanced and rational.  It thought that its well-considered policies would lead the people upwards out of tribe and faction into the sunny uplands of education and universalism.

You can see this delusion in every page of Capitalism in the Twenty-First Century by Thomas Piketty.  To Piketty and to tens of thousands like him in the ruling class, the administrative state is a "social state" delivering social justice in programs of free or subsidized services so that people have their "rights."  So it does. But he forgets that the "rights" were imagined by people like him.  The programs were designed and implemented by people like him, and the money, power, and love of beautiful women are all supposed to go to people like him.

That is why "people like him" don't like capitalism.  It cannot, surely cannot be just that under capitalism the money, power and beautiful women get snapped up by jumped-up barrow boys that just struck it lucky, and not given by a grateful populace to "people like him."

In fact, of course, the policy of administrative supremacy is a blast from the past.  It retreats to the politics of the village big man and the bureaucracy of the absolute monarch.  It is not a vehicle for enlightenment, it is a means of domination.  Thus, the more that the educated ruling class extends its programs of centralized administration the more it builds a structure of domination in which all people except the favored few are reduced to peonage.

The program of administrative centralism does not elevate the common man, and teach him the ways of the modern world.  It forces him back into the villages and cramped superstitions of the pre-industrial world.  Soon enough we will find out that the administrative state is bankrupt and failed, and the rule of the educated elite will be as discredited as the rule of the Caesars, the landed barons or the absolute monarchs.  People will rise up and topple the castles of power and something else will take its place.

What went wrong?  The educated elite believed too much in political power.  It could have remained satisfied with merely presiding over the evolutions of capitalism, but it didn't.  It wanted to rule over capitalism.

And the problem with political power and government is that it is good only for one thing: war.  It might be a foreign war on a dastardly enemy.  If not a foreign war then any government will instinctively start searching for enemies at home, and it will find them.

That is what all the furies over racism and the supposed Republican war on women and the constant turmoil on campus over diversity is about.  Government must have its enemy.

Our liberal friends don't see any enemies abroad.  They think that foreign policy very soon declines into neo-colonialism and imperialism, and they are probably right.

But the problem is that without foreign enemies, our liberal enemies find them at home.  So we get wars on poverty, on pollution, on bigotry, on racism, on corporate greed, on religion, on family.  And the bigger the government, the bigger the war.

We are the American people.  We don't want to be dragged into an endless war against each other.  Do we?

But the ruling class can't help itself.  It must have its war to fight, otherwise it loses its mandate to rule.

And so it will go, until the American people rise up and rebel against their rulers and change their ruling class, as the ordinary people of Europe are threatening to do.

Nothing new here.  Every ruling class creates injustice and domination, because every ruling class is blinded by its pride.

Thus we may say that every ruling class is blind to its faults until it is probably too late.

Beyond Tea Parties and UKIPs

It's jolly good fun to see that UKIP and its pubbable leader Nigel Farage tearing up the pavement in Britain over the weekend. Farage is a poster boy for the old working class man who said: "I like a drink and I like a smoke." But UKIP is rather like the Tea Party.  It's mad as hell, but don't touch its Medicare (or its NHS).

Look, I get it.  People work their entire lives paying those unjust payroll taxes; they see drifters and grifters playing the system for all the freebies they can get and they are damned if they are going to give their share up to some iffy reform of Social Security that tosses them to the mercies of the Wall Street casino.

(Only isn't it interesting that the S&P has practically doubled and the NASDAQ has practically tripled on Obama's watch while the ordinary working stiff can barely find a job. Yea the 1%, Barack!)

But Social Security and Medicare and the NHS are the problem, people.  Not the banksters or the frackers or the special interests or even the welfare moms and the idle single males.

The problem is as old as Eve.  The Serpent tempted me, and I did eat.  The politicians dangled free stuff before me, and I did vote.

Back in the dawn of the modern age, when the feudal system was breaking up in England in the 13th century, almost everyone kicked their kids out of the house at puberty.  They went into an apprenticeship or they went into "service".  They had to find a way to contribute, to earn a living wage; they were, to coin a phrase, "on their own."

We now know that a similar, but harsher, system obtained in China where the feudal system broke down in about 500 AD.  The Chinese owned their own land and distributed their land among their sons, so if you had more than one son the next generation ended up with less land per head.  If you didn't work hard and acquire more land your sons ended up without enough land to marry on.  Then they became hired laborers and never married and your seed died out.

It's the system I call responsible individualism.  Lefties call it Social Darwinism.  But in truth all human society, as all nature, is a form of Darwinism. Only the adaptable survive.  It might be social adaptation; it might be genetic adaptation.  But the rule of life is: adapt or die.

So the responsible individual has to grasp the nettle.  He has to say, first thing every morning: how can I contribute?  He cannot say, first thing: I got my rights!  The point about social cooperation is social cooperation, not social distribution.

Now, in his Capitalism in the Twenty-first Century Thomas Piketty proudly rehearses the intergenerational solidarity of the welfare state, which he calls the "social state" or the European Social Model.  In his social state the young generation pay for the benefits of the old generation, and this is wonderful.

No it isn't, because this social solidarity is based on force, on the votes of the elderly to force the young 'uns to pay brutal taxes.  It says: I got my rights; I got mine coming.  You call it social solidarity?  If you ask me, it isn't social, and it isn't solid.

Here is my idea of intergenerational solidarity.  The middle-aged work.  And they work until they have saved enough of a pile to provide a retirement income. (OK some people just cannot do that and we help them.)  This means, on a societal level, that you cannot retire until you have created enough jobs for young people to support you in your old age.  If there's a war or there's a recession, and the stock market is in the tank, then you have to put off your retirement for a few years.  That is what I call intergenerational solidarity; that's what I call generational justice.  People work to contribute; they don't march for their "rights."

So long as we continue in our politics to emphasize rights, and so long as we Eves allow the political serpents to tempt us, so long will our nation lurch from crisis to crisis.

The current "free stuff" political model is a primitive throwback to the age of agriculture and the hunter gatherers before the industrial revolution where land was wealth, and rape and pillage was the way to get a leg up in a zero-sum world.  But today people are wealth: human ingenuity and cooperation.  In Britain they began to really see this at the end of the 17th century in the Glorious Revolution where Whigs and Tories divided over the source of national wealth.  Tories thought in terms of land and its limits; Whigs thought that the new manufacturing and trade was a source of perhaps unlimited wealth.  Guess who was right?

We are still having that argument today.  Do we divide out a fixed pie in political programs and benefits?  Or do we work together as free and independent individuals to create new and bigger pies of perhaps unlimited size?

The good thing about the Obama administration is that you probably couldn't imagine a better way to demonstrate the utter bankruptcy of the fixed pie paradigm.

But don't think that rights and benefits politics will just go Poof! in 2016.  The story of the dog in the manger wasn't written as a joke.  The world is full of manger dogs, blindly barring the way to prosperity, because.  People will not give up their free stuff until ruin is staring them in the face.

But at least in 2016 the American people will be thinking: It's Time for a Change.

The Trouble with Keynes Is Us

Why has Keynesianism survived down to the present day?  Most TV commentators understand the economy in orthodox Keynesian terms.  The survival of Keynesianism is not that hard to understand, according to Sheldon Richman.

I’d have said it’s because Keynesianism gives intellectual cover for what politicians would want to do anyway: borrow, spend, and create money.

Another explanation Richman offers is from Lawrence H. White of George Mason University. Keynes gave people hope in the black despair of the Great Depression.  For economists, it gave them hope that they could solve the unemployment problem without going to totalitarianism.

My view is that the power of Keynes is to give not just politicians and economists but ordinary people the hope that they can continue doing what they are doing without making the wrenching changes that they desperately fear they must make.  Hey, no problem, the politicians can say!  Just sit back and let us do a bit of stimulus here, and a bit of quantitative easing there, and presto, it's recovery summer!  Because everyone wants to keep doing what they are doing until there is no longer any possible hope to continue in the old way.

The orthodox Austrian explanation of the business cycle centers on the idea that a recession is an inevitable consequence of the previous easy credit boom, because investments that looked solid in the boom are suddenly revealed as malinvestments.  Thus the people and resources marshalled into the lines of business now revealed as malinvestments must be liquidated, sooner or later. But nobody wants to hear that!  They don't want to confront what they know they must eventually do.  They want to continue in the old ways, and they sensibly elect politicians that will let them do it.

Of course it is the ordinary people that suffer losses to their wealth in the subsequent inflation and they lose their jobs in the malinvested industries anyway.  Then they will blame the politicians and the whole cycle can begin again.

We can excuse the politicians: theirs is the art of the possible, and if there is no majority for a party that offers orthodox capitalism with sound money and no freebies then a politician is a fool to offer it.

But the economists have no such excuse.  They know the problems with Keynesianism, or they ought to if they are as smart as they claim.  But we know why they are on the Keynesian train.  It is the same reason that the climate scientists are all aboard the global warming train.  It is money, power and the love of beautiful women.  That is one side of the coin.  But there is another reverse side of the coin.  If you don't get with the program you will get the brush off.  There won't be any professorships or adviser jobs for you.  So you'll abandon your economics Ph.D. and get into another line of business, and nobody wants to do that.

So what about the Obama economy?  How long can this miserable "recovery" continue?  Nobody knows.  But you can imagine that by November 2016 the American people will think it is "Time for a Change."  But the ghost of Keynes will still be with us.

Anti-Piketty: Because Conservatives Hate Compulsion

It's been a rough two weeks, but somebody had to do it. I just finished reading through Thomas Piketty's Capitalism in the Twenty-First Century and lived to blog about it.  You can start the blog commentary here. Now it's done and I've broken through into open country.

I get what Piketty is all about.  He's a bright young chap, darling of the French ruling class, and he's returning the compliment, as a good bribed apologist should.  What's needed, to save the authoritarian welfare state -- euphemistically called the "social state" or the "European Social Model" -- is force.  Its debt is way too large and so we must take money from the rich; that's OK, because their wealth is currently spiraling out of control. We must conduct a searching "financial cadaster" of all the world's private wealth and then bravely tax it.  Only thencan we resume the wonderful work of providing free education and health care.  And pensions.

No wonder our liberal friends love this Frenchy's ideas.

But I hate 'em.  The ideas, not the liberals.  Not so much because of the tendentious idea that the whole thing is due to r > g, that the return from capital is greater than the economic growth rate.  Of course it is!  Piketty's r and his g are apples and oranges.  The rate of return on capital is time discount + risk + surprise.  The growth rate is what's left.  They have nothing to do with each other.

No, what I hate is the compulsion.  Here we are, social animals as we are, and the only thing that a brilliant lefty can think to do in the current emergency is to bellow Captain Kirk's insistent request of Scotty for more power?  Just hand over 15-20 percent of your wealth and we'll fix everything?  You think I'm dumb or something?  Don't you lefties realize that your centralized one-size-fits-all model always ends up at the VA with secret waiting lists and people dying waiting for treatment?

But I can see the advantage of pretense, the pretense that this time with this trillion dollar program we have a perfect system to deliver... whatever: health care for our veterans, or to the uninsured, or to the traditionally marginalized.  Because then President Obama can always do the Casablanca line and be shocked, shocked that there are death panels going on at the VA.

Of course, I realize that we have our present centralized system because that's what most of the American people want.  They may be living in the modern capitalistic era but they think and feel like tribesmen. They look to the tribal leader as the powerful patron to keep them safe.  And so they whine and moan about the service and about "them".  But they are too cheap to turn away from the "free stuff" and pay their own way.

Let's turn away from this dysfunctional swamp and think beautiful thoughts.  Conservative thoughts.

Conservatism says that government is force.  So you have to face the truth that everything the government does is force.  If you do that it clears the mind.

You think educating little children can only be achieved confining them for twelve years in government child-custodial facilities with no time off for good behavior?  Really?

You think that the only way to get health care to the poor is by forcing everyone in society into a comprehensive and mandatory system run by bureaucrats and politicians?  Really?

You think that intergenerational solidarity means that old people get to vote to force young people to give them pensions?  Really?

That's the point about conservatism.  It starts with the faith, against all odds, that there must be a better way to deliver the benefits of society -- social services, if you will -- than force.

Because the problem with government is that the only thing that government knows is force.  And that means that it turns every question, every issue, into a war.  Now governments have always been pretty keen to go to war with the neighboring states.  No mystery about that: border war is in our genes, going all the way back to the chimpanzees.  Our problem is that if our government doesn't have a foreign war to fight it will stir up an argument at home.  It will conjure up some mortal peril, like inequality, or climate change, or the uninsured, that can only be overcome with the overwhelming force, mobilizing every citizen to fight the foe.  It could be spiraling inequality or it could be a rising sea level.  It doesn't matter, because the only thing needful is for government to have a war to fight.

Our lefty friends are firmly convinced that they are on the side of Peace and Justice.  Only first, of course, it will take a war on want, on poverty, on inflation, on bigots, on denialists, on racists, before the Heavenly Kingdom on Earth can begin.

Conservatives say that, if we are going to have a war, let's at least have a war against Commies in Russia or Islamists in the Middle East.  Let's not declare war on each other.

Why, we might end up in a real civil war and end up killing each other.

Waiting for Piketty

If I were home right now I could be at home reading Thomas Piketty's Capital in the Twenty First Century.  But I'm not at home.  So I have to wonder about the alleged argument of his book.  That capitalists make 4-5 percent on their money, but the GDP only increases 1.5 percent per year.  Therefore inequality.

Heather Wilhelm argues today that the fuss over Piketty reflects the frustration of the up-and-coming professional in a lefty city. She quotes David Brooks.

“If you are a young professional in a major city, you experience inequality firsthand,” Brooks wrote. “But the inequality you experience most acutely is not inequality down, toward the poor; it’s inequality up, toward the rich.”

Frustrated up-and-comers, he notes, mix and mingle with the wealthy, brushing elbows at cocktail parties, facing the constant indignity of having other people’s privilege shoved in their faces: “You wait in line at the post office,” he writes, “but they have staff to do it for them.”

Yes.  It must be insupportable to have to kow-tow to rich guys like Donald Sterling.

But I wonder what the Piketty thesis means.  What does it mean that capitalists are making 4-5 percent on their money?  What is the 4-5 percent compensating them for?  Is it too much or too little?  Or put it this way?  How much return on capital is economically necessary to yield 1.5 percent real GDP growth?  Return on capital is a tricky thing.  At one end it is the return on widow-and-orphan bonds, supposedly secured by bond covenants and collateral.  Those chaps don't deserve anything.  Right?  At the other end it is a reward for risk, taking a flier on an uncertain future.  How much is enough for that?

And that is to say nothing about whether we should do anything about inequality, let alone use it as a reason to give governments more money.

So I sit here and wait.  For the moment when I get to read what the New York Times calls "the big-think book of the moment."

A Word for Paul Ryan: White Women

Recently snarky BuzzFeed reporter MvKay Coppins followed Rep. Paul Ryan (R-WI) around as he worked to build outreach to blacks.

Yeah.  Whaddya know. Ryan was uncomfortable relating to black male convicts.  But when he went on to a lunch with businessmen he had all the one-liners down perfect.

I think it's wonderful that Paul Ryan, who is my idea of a worthy and principled politician, is trying to find ways of connecting to black voters.  It's not going to yield much in the way of votes for a long while, I'm afraid.

But there is something for more important out there for Paul Ryan to work on.  White women.  And I'll tell you why.

I attended a reunion at the consulting firm I used to work for up until 1996.  It was an engineering firm, and most of the folks there were practicing or retired engineers.  Salt of the earth guys, and all that.

But one thing hit me between the eyes.  I talked to some of the women there, technicians and assistants mostly, and a couple of them said they were "looking for work."

These are women in their fifties to sixties.  And they are looking for work.

Hello Obama economy.

Here is my advice to Paul Ryan and the Republican presidential contenders. Forget about the black vote for now.  Get to work on the white women vote.  Because white women are getting hammered, and I reckon they are up for grabs in 2014 and 2016.

What are these women thinking?  What do they think has gone wrong?  How can Republicans communicate the idea that government is not the solution?  How can Republicans gently shift them away from the idea that Hillary Clinton needs to be the First Woman President?

The problem is that women more than men are suckers for the liberal line in everything from the schools to the local news to the War on Women propaganda.  Women are more social; they are more conformist; they go with the program.

But we conservatives and Republicans are asking women to buck the local news, show the finger to cries of sexism, ignore their aggressive liberal women friends, and try something new and dangerous.

We are asking women to buck the collective consensus on women's victimhood that lets government take care of things.  Instead we want them to become responsible individualists and vote for small government and large people.

We want them to buck the idea that free contraception and unlimited abortion are the keys to women's liberation.

We want them to back away from government schooling, global warming, hyper-regulation of business, when all the government experts are telling women to go with the program.

How do we do that, Rep. Ryan?  That's far more important and necessary than a worthy -- and necessarily long term -- effort to find common ground with African Americans.

Telling it like it is: The Obama Purges

If we go back to the good old days of the Stalin Purges in the 1930s, what do we learn?  What made them different from just good old jailing of regime opponents?

After all, with modern police and incarceration methods, a repressive government can easily jail and disappear its opponents.  That's what the Argentine generals did to the lefty Montoneros back during their military junta days.  Argentine lefties are still complaining about it.

For Stalin, merely arresting his co-Bolshevik revolutionaries and disappearing them wasn't enough.  They had to confess.  There had to be a conspiracy against the father of his people, Comrade Stalin.  The heretics had to grovel before being tossed into the auto da fè.

So the Stalin Purges echoed the spirit of the Spanish Inquisition, another enforcer of orthodoxy.  Actually, in modern terms, the Spanish Inquisition was pretty mild.  It usually never got further than showing its victims the instruments of torture.  That was enough to get them to confess to horrible crimes and heresies.

When Barack Obama was elected as the United States First Black President many Americans thought that the long national nightmare on race was over.  We thought that the lion would lie down with the lamb and the race wars would be consigned to the dustbin of history.  We instinctively thought that the president would tell the race baiters to cool their jets.

In fact the opposite has occurred.  Whenever there is a race incident, from a black professor being stopped and frisked at his house in Cambridge, Massachusetts, or a black kid getting gunned down by a White Hispanic, or a rich sports-team owner spewing racial epithets at his mistress, the president steps in and amps up the outrage.

Now you would think that, fifty years after the end of government-sponsored racial segregation that we could draw a line under racism and say, look, there are a lot of white people that don't like black people.  But the fact is that they don't have political power.  There are laws to penalize racist acts.  Let's not get too overheated about what is in peoples' hearts and minds.

Government, after all, is not supposed to be worrying about hearts and minds, but the law.  That's what Janet Reno told us when the mood took her.

Forget government, it is religion that is supposed to worry about hearts and minds.

But our modern secular religions combine politics and religion into a single proto-totalitarian cult of the state.  Therefore in a modern secular liberal society, it does too matter what people are thinking.  And it does too matter that racist and sexist thoughts are swirling around out there.  It follows that they should be expunged, and that proper confessions should be made after people have been shown the instruments of torture.

President Obama has set a clear example to his co-religionists.  Heretics should be hunted down and publicly shamed.

With the example of their lightbringer before them, the followers of President Obama diligently search not just for criminal acts against the government of secular liberalism, but heretical thoughts against the gods of race, gender, and class.

Do they ever.

So we are justified in calling the present era the years of the Obama Purges.

President Obama and his supporters are eager to teach their ideological opponents a lesson.  Resistance is futile, they communicate in word and deed.

Maybe so.  But the problem with repression is that there are two responses.  One is to knuckle under to the new world order.  The other is to form a movement of resistance.  Some people conform; others rebel.

Which response will win out?