Socialisme, ou barbarie = a sublife vampirised by subcrime.
1. THE RECESSION.
A 2008-10 global recession is moving from the US and hitting Germany in 08Q2. Starting in the SUBCRIME mortgages boom and bust, it was amplified leading to the implosion\meltdown of shadow finance and a global credit crunch. Lehman’s failure in September 2008 marked the start of domino effects, from a Wall Street fall to the collapse and agony of Financial Capitalism, driving a severe and long recession. Due to: a LR global deflation, 2 bubble busts (housing and finance), wrong analyses and policies.
2. LR VIEW: END OF REAGANISM and GLOBALISATION.
Markets submit to the Leviathan.The WSJ (“Reform a la Glasgow”) fought regulation, with a self-regulation narrative that the meltdown has wiped out. So: which blend of Socialism? Bio one or Goldman Sachs? Financial Socialism inspires current policies: socialisation of subcriminal losses – except Lehman Brothers, all Wall St. and western banks are de facto nationalised. Tomorrow, as Wallerstein suggests, radical Robin Hood redistribution policies will be supplied by alternative bioregimes: namely New Deals or New Fascisms.
3. MEASURING THE EARTHQUAKE. RECESSION, DEFLATION OR DEPRESSION?
A 2010s depression is still possible, in absence of political chocs coping with a deflationary regime. and its unjust distribution. In a democracy, Greenspan, the rating agency and finance CEOs would be in jail for their subcrimes. But do we live in democracies, or a liberal-to-tyrannic gamma of bioregimes? Paradigms conflict: “Robin Hood” Bio- versus “Hood Robin” Thanato-politics. The former will win, in a political process that will shape the post-Financial Capitalism bioregimes.
But, as in ancient Greek Myth, financial accelerators ate Bernanke, their father
ciò, mi son sensa laoro: ghe xe a crisi merikana (el colombo el xé EN BRAGHE DE TELA).
The Venetian Colombo, after flying virtual skies, has something to tell you:
subcrimesocialscience080503 HAS BEEN UPDATED, since June 15, with a NEW VERSION:
WHAT IS Sub-C Bio Soc Sci about?
This static page introduces to the current version of our 30 pp. summary of what different bio-social sciences and Political Economy have to say, about the current subcrime turmoil. This review of analyses, policies and a long annotated bibliography, doesn’t come in a vacuum. After the last US bubble exploded last summer, a credit crunch and (through financial accelerators) world recession has been rolling on. March 2008 was epic: subcrimebiosocialscience was revealed to us on Palm Sunday; we owe the substitution of subcrime for subprime to Rev. Jessie Jackson. Prof. Roubini (rgemonitor.com) had been prophetic: a domino effect, potentially self-destroying for many banks and a few capitalisms, was at hand.
In the pdf, we explain why this will happen again and again, after short bubbles, in our DKE – Deflationary Keyenesian Era (see ABC: Aglietta-Berrebi, Chesnais).
Concurrent crises now on:
1) housing – mortgage markets, namely in the US;
2) the global shadow financial system meltdown;
3) ag- and stag-flation from: Humboldt oil peak; primary resources oligopolies, and often hyper concentrated markets.
The subcrime recession occurs within a Long Wave (LW): technical paradigms (Dosi) become socio-economic ones through a complex social change, that regulates innovation diffusion, and is marked by financial bubbles and busts. Nothing guarantees a priori a potential growth LW will take off: on the contrary, a lagging social change often induces a mismatch. The current deflationary hysteresis of the global economy is a macro-case of such a Carlota Perez’s mismatch. An ICT LW took off in the 1970s, but was not met by adequate POST-FORDIST social and political reforms. On the contrary, a lack of Surplus Value (SV) redistribution, and a Reaganite freezing of societal evolution degenerated the LW ups and downs into a flat Epoch of Deflation (masked by the ‘90s boom). An OVER-REACTION to Marx’s law of falling profit rate, uncorrected by democracy and social conflict, yielded excess SV, OVER-ACCUMULATION. This was deepened by the way capitalisms dealt with post-communism (L. Napoleoni), in a “2nd Great Transformation” (Polanyi) of capitalisms – doubling the labour force and instituting for the first time a GIRA – Globalised Industrial Reserve Army: an infinite burden on wages, inducing low cost and deflation.
Either this, or the next short-run recession will degenerate into a systemic 2010s long depression. The 2010s will pass to history like the 1880s and 1920s: uncertainty concerns only BRICS growth performance: from 10%, down to what? In the rest of the world, there will be 0 growth, slow innovations diffusion, high financial speculation, stagflation, post-Humboldt energy crises (the nuclear no way out) and global climate heating.
In a democracy, Bernanke and Trichet, the rating agency and big finance CEOs would be all in jail, for their sub-crimes; therefore capitalist systems would evolve differently, under new leaderships. As subcriminals impunity testifies, we do not live in democracies (no one is left), but a liberal (India, S. Africa, West) to tyrannic (Africa, China, Russia) gamma of ThanatoSystems.
MORE FOOD 4 THOUGHT
Remember Gloria Ortiz. We knew her in March 22 WP: ‘My House. My Dream. It Was All an Illusion.’ BRIGIDA SCHULTE (our candidate for the Pulitzer) was telling us about Gloria and her husband: they don’t American Dream any more. Some rentiers, speculators and financial managers are dreaming in their place, with their wage they expropriated by subcrime.
It might happen to everybody (a Rawls’ veil of ucertainty): on top of exploitation and monopolies, even slavery, or – more often – a value expropriation of the creative and the oppressed (Harvey) by RENTIERS (Keynes), in a Global Reserve Army age (suddenly up, in the early 1990s, from 10% to 50% of a doubled labour force: up from 1.46 to 2.93 billions – Richard Freeman est. quoted by Napoleoni 2008, n.6 ch. 2).
In the enclosed 30 pp. document subcrimebiosocialscience1:
An anomalous KONDRATIEV – MINSKY LONG WAVE: a deflationary tsunami
The Financial Meltdown inducing a world recession, after dotcom and subcrime bubbles
Suggested reading no. 1: François Chesnais (2008, Jan.), Fin d’un cycle. Sur la portée et le cheminement de la crise financière. Carré Rouge – La Brèche, 1: 17-31.
De(e)pre(ce)ssion ROBIN HOOD economic, financial, revolutionary and social policies:
a) States are massively intervening: after decades of neocon mind washing, Minsky finally won his bet versus Chicago. The free market ideology died on March the 14th, 2008. Worth a memo on your agendas.
b) This sudden State Capitalism activism is part of the crisis (Roudini, Feb. 8 blogpost), in a self-referential system (Niklas Luhman): no one is outside.
c) As in Myths, financial accelerators ate Bernanke himself, their own father.
d) From Marx, Minsky’s institutions-specific analysis, the endogenous institutions axiom, and Luhman’s self-referential systems – it follows that:
e) a new class struggle cycle is starting now, even in China. It is of a new species, adapt and fit to a Rentiers overpower, overshooting and hyper-deflationary environment (because of a sudden world labour doubling – 1.46 to 2.93 bn).
f) Our immediate tactical targets are ROBIN HOOD financial regulations, economic and social policies: 1) stolen wages back to victims. Not a cent from the taxayer to the socialisation of rentiers’ losses. Bail out money back. 2) All the subcrime rentiers in jail: the entire chain, starting from top finance CEOs and top management.
g) We have an immense power in our hands, a 1 trillion $ one: THEIR SYSTEM JUST DOESN’T WORK. It was never so rotten as it is now. It’s system failure.
h) Our long term, strategic target is left to your fertile imagination …
TOP TEN readings
1. Michel Aglietta and Laurent Berrebi (2007), Désordres dans le capitalisme mondiale. Paris: Odile Jacob.
The definitive interpretation of our deflationary age.
2. François Chesnais (2008, Jan.), Fin d’un cycle. Sur la portée et le cheminement de la crise financière. Carré Rouge – La Brèche, 1: 17-31.
Incapsulating Aglietta’s empirics and thesis in a Marxian frame.
3. Gillian Tett (2008, May 31\ June 1), “Derivatives” have become a dirty word. FT Weekend magazine, pp. 21 -6. Best inquiry on the last Minsky cicle, with insider stories and artistic portraits by M. Clement.
4. Paul Jorion (2007), Vers la crise du capitalisme américain? Paris: La Découverte – MAUSS. A thorough, unsurpassable description of the subcrime scene: à la Hitchcock.
5. Hyman P. Minsky (1982), The Financial Instability Hypothesis: Capitalist Processes and the Behaviour of the Economy, pp. 13-4 in: Charles P. Kindleberger and Jean-Pierre Laffargue eds., Financial Crises. Cambridge: Cambridge University Press. The new cycle theory: Section 3.
6. Hyman P. Minsky (1993), The Financial Instability Hypothesis. Philip Arestis and Malcolm Sawyer eds., Handbook of Radical Political Economy. Aldershot: Edward Elgar. (See Section 3 above) http://www.levy.org/pubs/wp74.pdf
After-State: a crime-free market nightmare mix.
8. Carlota Perez (2002), Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages. Cheltenham, U.K.: Edward Elgar. A companion to Minsky: the full post-Schumeterian theory of bubbles and clusters. Economic media banalise Schumpeter, pretend bubbles are just a byproduct, and illegally enroll him in the free-market right: read these antidotes – against the ideology of the idiots.
9. Roberto Saviano (2006), Gomorra. Like a cameo in Loretta’s fresco: the South Italy Tirrenic coast is governed by illegal multinationals (camorras, ndrangheta, mafia). In comparison, pre-civil war US South was a civil rights dreamland. A civil war will not be enough to eradicate all this.
10. Brigida Schulte (2008, March 22), My House. My Dream. It Was All an Illusion.’ Washington Post (Glenda Ortiz drama).