Wednesday, November 17, 2010

The new ownership society

So, asks a puzzled person, isn't the massive wealth redistribution that has happened over the past thirty years bad for the wealthy too? After all, the companies they own need customers for their goods, and if nobody has any money other than the wealthy, then there's less goods sold, and the wealthy get less money.

Ah, but... see, the thing is, money isn't wealth. Wealth is GOODS AND SERVICES. Money is just a handy intermediary to use to transfer goods and services around. What is wealth is what you *buy* with money -- things like, say, dachas on the Black Sea, McMansions on the ring road, that sort of thing.

During times of inflation, people took on debt or purchased assets at inflated costs. During times of deflation, people can not pay their debts in the now-suddenly-scarcer currency, and have everything taken from them by the ownership class. From 1937 to 2008, thanks to years of Keynesian economics, the supply of currency rose every year. Note that monetary inflation is the same thing as debt deflation -- your debts become worth less in real terms every year during times of inflation. People made major life decisions such as purchasing a home based upon the notion that prices would always rise -- a notion which 70 years of Keynesian economics applied to the money supply reinforced, because nobody under the age of 70 had any experience with monetary deflation (that is, shrinkage of the money supply -- NOT AT ALL the same as price and wage deflation, which lags monetary deflation for reasons I've previously discussed here). These people made a decision which seemed reasonable given their life's experience... and then had the stool of their entire life's experience kicked out from under them as they hung in the air and money suddenly became much scarcer.

So what's the end game? The new ownership society is where the wealthy own *everything* because the money supply has crashed so far that nobody can pay their debts -- and the owner class buys up the defaulted assets for pennies on the dollar. At that point, the ownership class really doesn't care if the money supply collapses all the way and they can't sell anything for money. Because they will own you. Think Latin America's oligarchs. They own everything, so their minions have no place to go and must labor in their fields and workshops to produce the hand-made goods and services they want. Their every need is taken care of by their serfs, who beg for crumbs of bread in exchange for being allowed the privilege of placing a bathrobe upon their master's back upon their master exiting his bath. What few things they need that their serfs cannot make in their master's workshop are bought by exporting agricultural goods, natural resources, and hand-made items from those workshops to more civilized nations and getting the technological goods they want back in return. Do these people care that they can't sell anything to their serfs? No. And neither will our ownership class, once they own everything -- including us.

-- Badtux the Apocalyptic Penguin


  1. Well that's a rather pessimistic view, Mr. Grumpy.

    They still have to balance how much they can grab with the possibility of civil unrest & their ability to mobilize state violence to quell the unrest. I mean, they still have to feed us.

    As someone said recently, people don't voluntarily starve to death. Though in this country they may involuntarily starve to death alone, rather than get involved with those dirty fucking hippies who want to change things.

    While modern communications technology provides the means for "revolutionaries" to coordinate resistance in ways not previously possible, the fear of that happening isn't making our aristocracy lose any sleep.

  2. Ah, but modern technology also makes it easier to *monitor* the revolutionaries than at any other time in our history. Today I witnessed the test of a new camera system which will do a panoramic view of an area, recognize people who enter the area who are within its database, and issue an alert to security personnel if the person is a "person of interest". It will also detect people who linger in a suspicious manner and open a box on the screen display for the security personnel to view. I watched as someone entered the room, walked across the room, and poured himself a cup of coffee. I saw a panoramic view of the room and he had a box identifying him as a person around him as he moved across the room.

    All of your other activities are equally monitored. I write every word I write with full knowledge that it will be examined by the national security states' computers looking for hints of anything that might even suggest direct action that could threaten the existence of the national security state. And as I've pointed out before, there is a significant population -- perhaps 5% of the population, any population -- that is just plain mean and vicious and gets off on acts of violence. And they're quite happy to work for our oligarchs as long as our oligarchs let them grope women's breasts and squeeze men's balls with impunity...

    Of course, this is just one vision amongst many that I've presented on this blog. Hopefully it will not happen. I've been wrong before, like back in 2000 when I said "Gosh, what's the problem with George W. Bush being elected? Bill Clinton was basically a moderate Republican anyhow, another moderate Republican President is no big deal." Boy was I wrong about that one! Let's hope that I'm equally wrong about this one...

    - Badtux the Apocalyptic Penguin

  3. I will, overly-optimistically, put my faith in the kind of people who apply themselves to breaking the, er, DMCA-mandated encryption on our favorite movies. I'm sure they'll subvert the surveillance society's panopticon & save us all from the pitiless iron boot of capitalism.

  4. No one is going to own me, everything is free and clear and I'm retired anyway.

  5. Ah, but modern technology also makes it easier to *monitor* the revolutionaries than at any other time in our history.

    No worries, I'm just a cheerleader. And never under estimate the craftiness of the underdog.

  6. I read your reply concerning sadistic agents of national security with newly piqued interest until you got to the breast and ball squeezin' eyes glazed over at yet another reference to the TSA's latest exploits....zzz

  7. I used to think that Duhmericans would not voluntarily starve to death; that there will come a tipping point where they will lurch about violently and fuck shit up until something changes.

    But I saw a comment on Jim Kunstler's latest blogpost that says an alternate, grinding, future might be in the offing:

    "I live in Africa and believe me, yeast folk, you have no idea how much things can deteriorate, how poor you become, how many services can fail while at the same time there are still rich politicians and their business pals driving in big limos (more like BMW X6s round here) down new freeways doing exactly what they want. Where I live half the population under 30 has no job and no hope of getting one. A third of country live in shacks. There are plagues, no-go zones, corrupt pigs demanding bribes everywhere, more taxes. But at the same time more golf esates, more BMW X6s and more silicone breast implants than ever before! It becomes normal very quickly, trust me.
    If you're waiting for some kind of poverty limit to spark revolt you're going to wait forever."

    So be optimistic! The future might be never-ending shit, not fire...

  8. Bukko, the problem is that Americans are well armed (indeed practically drowning in a sea of guns and ammo) and insane. I mean, c'mon. You got grown supposed adults ranting and raving "keep your government hands off my Medicare!", we ain't talkin' 'bout the most stable folks on the planet here, duh. Those places of crushing poverty that Kunstler talks about have mostly *always* been places of crushing poverty, where that sea of guns and ammo in the hands of the peasantry doesn't exist.

    The problem, of course, is that the same sort of insane duh-mericans who'd shout "keep your government hands off my Medicare" also aren't the sharpest tacks in the box, if ya get my drift. They're well qualified to be brownshirts in the personal armies of particularly charismatic oligarchs, in other words.

    One of the major causes of the final collapse of the Roman borders was when the Roman legions were recalled to Rome to deal with civil disorder (much of which was from *other* Roman legions, granted, but there was widespread disorder amongst the general citizenry too). When U.S. troops are recalled from overseas and ordered to fire upon American citizens... then, and no sooner, will we know the end game. Will they open fire, in which case the end game is Kunstler's? Or will something else happen? Curious penguins *don't* want to know... but fear they'll find out anyhow.

    - Badtux the History Penguin

  9. Some of us remember Kent State as if it were yesterday.


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