Friday, July 3, 2009
Wednesday, June 24, 2009
The post-totalitarian system touches people at every step, but it does so with its ideological gloves on. This is why life in the system is so thoroughly permeated with hypocrisy and lies: government by bureaucracy is called popular government; the working class is enslaved in the name of the working class; the complete degradation of the individual is presented as his ultimate liberation; depriving people of information is called making it available; the use of power to manipulate is called the public control of power, and the arbitrary abuse of power is called observing the legal code; the repression of culture is called its development; the expansion of imperial influence is presented as support for the oppressed; the lack of free expression becomes the highest form of freedom; farcical elections become the highest form of democracy; banning independent thought becomes the most scientific of world views; military occupation becomes fraternal assistance. Because the regime is captive to its own lies, it must falsify everything. It falsifies the past. It falsifies the present, and it falsifies the future. It falsifies statistics. It pretends not to possess an omnipotent and unprincipled police apparatus. It pretends to respect human rights. It pretends to persecute no one. It pretends to fear nothing. It pretends to pretend nothing.
Individuals need not believe all these mystifications, but they must behave as though they did, or they must at least tolerate them in silence, or get along well with those who work with them. For this reason, however, they must live within a lie. They need not accept the lie. It is enough for them to have accepted their life with it and in it. For by this very fact, individuals confirm the system, fulfill the system, make the system, are the system.
Thursday, June 11, 2009
Barack Obama's speech in Cairo:
I like these final paragraphs of his speech. I think it speaks at something deeper and, if there is one thing that Obama is good at that is oration. And, I fully believe that words are important, they can help build and sustain bonds and open up new ways of interacting.
All of us share this world for but a brief moment in time. The question is whether we spend that time focused on what pushes us apart, or whether we commit ourselves to an effort - a sustained effort - to find common ground, to focus on the future we seek for our children, and to respect the dignity of all human beings.
It is easier to start wars than to end them. It is easier to blame others than to look inward; to see what is different about someone than to find the things we share. But we should choose the right path, not just the easy path. There is also one rule that lies at the heart of every religion - that we do unto others as we would have them do unto us. This truth transcends nations and peoples - a belief that isn't new; that isn't black or white or brown; that isn't Christian, or Muslim or Jew. It's a belief that pulsed in the cradle of civilization, and that still beats in the heart of billions. It's a faith in other people, and it's what brought me here today.
We have the power to make the world we seek, but only if we have the courage to make a new beginning, keeping in mind what has been written.
The Holy Koran tells us, "O mankind! We have created you male and a female; and we have made you into nations and tribes so that you may know one another."
The Talmud tells us: "The whole of the Torah is for the purpose of promoting peace."
The Holy Bible tells us, "Blessed are the peacemakers, for they shall be called sons of God."
I think that this is one of the biggest battles in the field of economics and more generally in the study, or need for a renewed emphasis, on Political-Economy in a qualitative rather then quantitative study. My feeling is much of the work that really relates to the Political-Economy in this way is happening in Anthropology and Sociology and Human Geography. However, there is a long history of solid Political-Economics or the Philosophy of both. I find myself in that space, and am often dissapointed by what I bump up against in most political and economics departments where the research has become so intensly mathematical and quantitative.
von Hayek was one of those very interesting and great Political-Economists. Not that I agree with many of his ideas, but I do agree with the above quote.
Friday, April 24, 2009
She has been going around the city of Cape Town with the renowned photographer, Inge Prins, photographing everyday people jumping on a bed - Surfers on Muizenberg Beach, the cleaning staff at the Mount Nelson Hotel, fishermen at Kalk Bay Harbor and more.
The goal is to have a large gallery show, where the photographs are auctioned off and the monies donated to a program started by three mothers in Lavender Hill (a rather poor and gang infested suburb of Cape Town). The program called, Mothers Unite, feeds the local children daily with foods donated by local businesses.
Here are a couple videos to give you all a taste. The plans are to take the same concept global - Bed Jump San Francisco, India, Europe and more.
Friday, April 17, 2009
These are two of the elements that I consider to be critical to the belief mechanisms that help to drive modern capitalism and the connected negative consequences of that system. The question then is how do you create a system that recognizes concepts of abundance and cooperation? My answer has come to rest on notions of money - and on ideas of creating alternative currencies that place or rather respond to values of abundance and cooperation in a positive way.
I believe that a currency that operates under the rules of 1) Zero Interest 2) A separation of medium-of-exchange and store-of-value 3) that has a demurrage, will bring us closer to meeting the goals of reducing environmental destruction, reducing growing inequalities (which is driven by hoarding of money) and of reducing the need for competition (and therefore commodification) while helping to promote the ability of communities that currently lack a medium-of-exchange to generate their local economies (and here I am referring to communities in Africa).
I place my energy behind the creation of alternative currencies because I believe this has two impacts on society 1) It allows us, as a society, to recognize our power over the economy and that money is our creation, not some God given right of the state or even a natural byproduct 2) It allows us to explore value systems and forces us to talk and debate about what are the most critical things that our money needs to value.
In this way I turn to the rise of mobile technology in Africa and the pioneering ideas of Michael Linton who talks about the value of technology in the spread and creation of alternative currencies. Much of his thinking is detailed by Keith Hart who talks about the changing subject/object relationship that is produced through the virtualization of money.
As I am sure, and hope you can see, I have built my thinking into a pretty cohesive flow. The big question is where do I ask my question and at what point do I place that question? I am not interested in the quantitative element of this discussion, I think Friedrich von Hayek said it best in his book "Denationalisation of Money",
"Though the popular tendency in economics is to accept only statistaically testable theories...they have acquired a quite undeserved reputation." (p. 48)He then goes on to say,
"To introduce sharp distinctions which do not exist in the real world in order to make a subject susceptible to mathematical treatment is not to make it more scientific but "rather less so." (p 48)It is with this in mind that I look to explore these questions through a much more philosophical and theoretical lens. I believe that these questions are not mathematical but are far more social and political.
I am trying to find a professor at University of Cape Town that is wiling to work with me in exploring these ideas and helping me to formulate my theoretical framework. I have, as of today, still not found that individual. I will continue to push forward.
Tuesday, April 7, 2009
I have been researching alternative/complementary currencies (I use the term "alternative" as a loose definition. Effectively meaning a complementary currency, however one that acts as an "alternative" to the national currency) for over 6 months, and political-economy for many years. I have read large amounts of literature with the majority of it coming from groups of people who make the argument for local economies.
These authors include Thomas Greco, Michael Linton, Eric Harris-Braun and many more. What all of these people are trying to do is present the opportunity for communities to create there own medium-of-exchange. And, ultimately, to challenge the monopoly of money creation that the state has aquired. Many of these writers are focused on the "local" and of, "reinvigorating" these local economies with the aim to building new social relations, creating value around community and small businesses. One can see this as a push back, a Polanyian double movement, against the multi-national corporate driven globalization. The argument is in part grownded in the belief that these alternative currencies could capture some of the ground back from the advance of globalization. I have written about my issues of conceptions of the local that dominate much of this literature.
The part that does excite me about it is the idea of actually being able to create your own medium-of-exchange as a community. That this in its own way is paradigm shifting - Keith Hart talks about this, though I don't think he uses the term "paradigm shifting". Eric Harris-Braun, Art Brock and Bernard Lietear also touch on this. It certainly challenges one of the most taken for granted elements of the economic systems - money creation. The goal is to really redefine what currency means and how we view our economic system. Each one of these thinkers/writers deserve a much deeper analyses, but for now I am mearly trying to set the stage for a type of convergence that I want to highlight.
Until recently I had not come across any other main-stream economists making an argument for the creation of alternative currencies. I have heard that Greenspan has talked about the rise of alternative currencies in the 21st century (I have yet to see the actual quote). However, my recent discovery of the book by Frederich von Hayek called, "Denationalising of Money" calls for the end of the state monopoly of money creation - the separation of money creation and government. His argument is founded on the belief in markets and free competition. That these two elements will lead to the creation of multiple, stable (but flexible) currencies and will end the ability of the government, through its monopoly, to create inflation/deflation by printing more money.
One thing that von Hayek does not say in his book is if the government will still be permitted to create money? Or, if all money creation, is left to the private sector. I am inclined to believe he would have defaulted to the latter.
What I find extremely interesting here is that we have, on the left - the community based local economy activists and on the right we have the neo-liberal free-market economists - all coming down to the same conclusion; freeing up the right to create a medium-of-exchange.
What, of course, is critical here is how these alternatives are framed and what, if they are to be created, these alternative currencies look like. This leads to the next, and what I think is probably the harder and more complicated question to answer; what are the critical elements of an alternative currency? What attributes does this currency have? How is it valued? Is it backed by commodities? Assets? These questions are all very murky and are talked about by many different schools of thought.
At this point I believe that a zero-interest (Silvio Gesell and Margrit Kennedy), non-debt based (James Robertson and others) currency offers the greatest possibility of enabling a type of capitalism that does not require continues growth , and helps address the issues of compound interest and exponential growth (Steady State Economics, Herman Daly and many others). The ultimate goal being a reduction in the environmentally destructive nature of our current economic system, and reducing those that live in absolute poverty.
I am not fixed on these attributes, I may discover that there are serious flaws in them. I continue to explore and dig around. The place that this has brought me to is an exploration of the explosion of the mobile phone in Africa and the concurrent development of mobile-banking and airtime bartering/transfers. With a grant that I recently received from the Institute for Money, Technology and Financial Inclusion I hope to explore this intersection between global networks, virtual currencies, under-monetized economies and alternative currencies. My feeling is this intersection offers an incredible opportunity to explore the multiple elements of the issues raised.
More to come....
Monday, March 2, 2009
When Bruce talks about the "clouds" in Web2.0 he makes a very interesting analogy with financial thinking and the rise of "securitization" pointing out some of the connections and inherent contradictions:
Imagine that this was financial thinking [referring to clouds in Web2.0 world] -- instead of web design thinking. We take a bunch of loans, we mash them together and turn them into a security. Now securities are secure, right? They are triple-A solid! So now we can build more loans on top of those securities. Ingenious! This means the price of credit trends to zero, so the user base expands radically, so everybody can have credit!
Nobody could have tried that before, because that sounds like a magic Ponzi scheme. But luckily, we have computers in banking now. That means Moore's law is gonna save us! Instead of it being really obvious who owes what to whom, we can have a fluid, formless ownership structure that's always in permanent beta. As long as we keep moving forward, adding attractive new features, the situation is booming!
In this next quote Bruce points out some of the inherent stupidity in much of the West's thinking about global connectedness and the role of the web. It is about "networking" it is about "communicating" it is not about what we think - creating viable monetized business models. Hell, the sharing of ideas is what is viable.
The people of the world are building a new global network and it doesn't require the fastest and best computer in the world with fat high-speed connections. What it requires is very simple technology - remember when the phone came to the west how that revolutionized our worlds? How it allowed us to grow a new set of relationships? This is what is going on in the world - in Africa, India, Asia, S. America. People are able to make phone calls - that is powerful stuff. And focusing on this is what will maybe give us a sense of the direction we are headed in.
Bruce points out that we don't even know what we are creating next. This is what is so exciting we don't have a blueprint but we have a sense we know that the last system and what it was built on is non-sustainable and it will and has collapsed. Time to network to talk to share and to communicate.
Ultimately Bruce gets at one of the fundamental questions I am asking in my own research and I think many others are asking:
Gosh, we're really sorry that we accidentally ruined the NASDAQ." We're Internet business people, but maybe we should spend less of our time stock-kiting. The Web's a communications medium -- how 'bout working on the computer interface, so that people can really communicate?
That effort was time well spent. Really.
A lot of issues that Web 1.0 was sweating blood about, they went away for good. The "digital divide," for instance. Man, I hated that. All the planet's poor kids had to have desktop machines. With fiber optic. Sure! You go to Bombay, Shanghai, Lagos even, you're like "hey kid, how about this OLPC so you can level the playing field with the South Bronx and East Los Angeles?" And he's like "Do I have to? I've already got three Nokias." The teacher is slapping the cellphone out of his hand because he's acing the tests by sneaking in SMS traffic.
"Half the planet has never made a phone call." Boy, that's a shame -- especially when pirates in Somalia are making satellite calls off stolen supertankers. The poorest people in the world love cellphones. They're spreading so fast they make PCs look like turtles.
Digital culture, I knew it well. It died -- young, fast and pretty. It's all about network culture now.
We've got a web built on top of a collapsed economy. THAT's the black hole at the center of the solar system now. There's gonna be a Transition Web. Your economic system collapses: Eastern Europe, Russia, the Transition Economy, that bracing experience is for everybody now. Except it's not Communism transitioning toward capitalism. It's the whole world into transition toward something we don't even have proper words for.
After a while you have to wonder if it's worth it -- the money model, I mean. Is finance worth the cost of being involved with the finance? The web smashed stocks. Global banking blew up all over the planet all at once... Not a single country anywhere with a viable economic policy under globalization. Is there a message here?Can we not design as system of economic interaction that doesn't require us to "monetize" everything in order for it to get some semblance of value? Can we create a system that recognizes "abundance"? That there are certain things that hold an "infinite" value - that there exists no right to destroy or purchase this value?
Are there some non-financial structures that are less predatory and unstable than this radically out-of-kilter invisible hand? The invisible hand is gonna strangle us! Everybody's got a hand out -- how about offering people some visible hands?
What can we do about the way our money behaves? Can we design multiple currency systems that are able to meet our needs as a global society? What role does "credit" have in all of this? What about creating money without creating debt?
Oh I am sure there will be many market fundamentalist arguments against this. That is okay it needs to be tested. However, we are moving into a new territory of economic systems and this needs to be recognized. We don't know exactly what it looks like but we know how we want it to work.
As Bruce says it needs to be about "visible hands" not a groping around for some "invisible force" that operates beyond our control.
Monday, February 23, 2009
This remarkable sequence of events can be understood only if we abandon the prevailing theory of market behavior. As a way of explaining financial markets, I propose an alternative paradigm that differs from the current one in two respects. First, financial markets do not reflect prevailing conditions accurately; they provide a picture that is always biased or distorted in one way or another. Second, the distorted views held by market participants and expressed in market prices can, under certain circumstances, affect the so-called fundamentals that market prices are supposed to reflect. This two-way circular connection between market prices and the underlying reality I call reflexivity.
It is important to recognize that regulators base their decisions on a distorted view of reality just as much as market participants—perhaps even more so because regulators are not only human but also bureaucratic and subject to political influences. So the interplay between regulators and market participants is also reflexive in character. In contrast to bubbles, which occur only infrequently, the cat-and-mouse game between regulators and markets goes on continuously. As a consequence reflexivity is at work at all times and it is a mistake to ignore its influence. Yet that is exactly what the prevailing theory of financial markets has done and that mistake is ultimately responsible for the severity of the current crisis.
Sunday, February 22, 2009
Q: What are banks for?
A: To make money.
Q: For the customers?
A: For the banks.
Q: Why doesn't bank advertising mention this?
A: It would not be in good taste. But it is mentioned by implication in references to reserves of £249,000,000,000 or thereabouts. That is the money they have made.
Q: Out of the customers?
A: I suppose so.
Q: They also mention Assets of £500,000,000,000 or thereabouts. Have they made that too?
A: Not exactly. That is the money they use to make money.
Q: I see. And they keep it in a safe somewhere?
A: Not at all. They lend it to customers.
Q: Then they haven't got it?
Q: Then how is it Assets?
A: They maintain that it would be if they got it back.
Q: But they must have some money in a safe somewhere?
A: Yes, usually £500,000,000,000 or thereabouts. This is called Liabilities.
Q: But if they've got it, how can they be liable for it?
A: Because it isn't theirs.
Q: Then why do they have it?
A: It has been lent to them by customers.
Q: You mean customers lend banks money?
A: In effect. They put money into their accounts, so it is really lent to the banks.
Q: And what do the banks do with it?
A: Lend it to other customers.
Q: But you said that money they lent to other people was Assets?
Q: Then Assets and Liabilities must be the same thing?
A: You can't really say that.
Q: But you've just said it! If I put £100 into my account the bank is liable to have to pay it back, so it's Liabilities. But they go and lend it to someone else and he is liable to have to pay it back, so it's Assets.
It's the same £100 isn't it?
A: Yes, but....
Q: Then it cancels out. It means, doesn't it, that banks haven't really any money at all?
Q: Never mind theoretically! And if they haven't any money, where do they get their Reserves of £249,000,000,000 or thereabouts?
A: I told you. That is the money they have made.
A: Well, when they lend your £100 to someone they charge him interest.
Q: How much?
A: It depends on the Bank Rate. Say five and a-half percent. That's their profit.
Q: Why isn't it my profit? Isn't it my money?
A: It's the theory of banking practice that.........
Q: When I lend them my £100 why don't I charge them interest?
A: You do.
Q: You don't say. How much?
A: It depends on the Bank Rate. Say a half percent.
Q: Grasping of me, rather?
A: But that's only if you're not going to draw the money out again.
Q: But of course I'm going to draw the money out again! If I hadn't wanted to draw it out again I could have buried it in the garden!
A: They wouldn't like you to draw it out again.
Q: Why not? If I keep it there you say it's a Liability. Wouldn't they be glad if I reduced their Liabilities by removing it?
A: No. Because if you remove it they can't lend it to anyone else.
Q: But if I wanted to remove it they'd have to let me?
Q: But suppose they've already lent it to another customer?
A: Then they'll let you have some other customers money.
Q: But suppose he wants his too....and they've already let me have it?
A: You're being purposely obtuse.
Q: I think I'm being acute. What if everyone wanted their money all at once?
A: It's the theory of banking practice that they never would.
Q: So what banks bank on, is not having to meet their commitments?
A. YOU GOT IT!
Thursday, January 8, 2009
It talks about how our fish stocks are almost wiped out, that the oceans are becoming acid changing the entire composition of the oceans behavior. The profusion of massive dead zones throughout the oceans with algae and red tides. The possibility of most shell fish dying off, nuclear waste, pesticides and other heavy metals flooding into the oceans. The destruction of almost all coral reefs.
This is not a singular issue. It is not just a problem of too much CO2 but is rather a product of the type of economic structure we have in place. An economy that truly places no value on the abundant natural resources. They are viewed as holding no value so therefore no cost is associated with their destruction until it is potentially too late.
It is time to rethink this economic structure. Not tomorrow. But TODAY!! It is time to create a value structure that recognizes the value held in our global common goods; that abundance is a valuable element in the economy and needs to be integrated into the pricing system. We can not ignore this any longer.
Or, within our lifetimes there will be no more sharks, tuna, coral reefs, whales or oceans safe to swim in. It brings tears to my eyes and we the people, the citizens and stewards of this system need to wake up and take responsibility. Change is hard but it is a necessary and constant part of life.
I believe the most important thing we can do is come up with an economic structure that places value on abundance over scarcity, on cooperation over competition, on flow over accumulation. This, people, is a task for our generation and we must, we have to, step up and take responsibility now!!
It goes something like this, "innocent commercial boats are attacked by wild machine gun totting Somali's looking for a few million to finance the extremists that have destroyed the country".
I am sure there is a modicum of truth to this. But, what is the back story? Why would these guys go out and hijack these boats? Why now? Why would they be willing to do this and what is motivating them? But, in classic western media style Africa is again portrayed as all messed up and just another case of the "failed state". So, lets send out some of our big military ships to protect the ability to do business. Yes, because oil and other goods are more important and worth the investment.
Well, I was sent this article written by Johan Hari of the London Independent which was posted on the Huffington Post recently and it really opened my eyes to a background story that I had not heard anywhere in mainstream media.
The story goes that foreign ships have been fishing the waters off Somalia devastating the ability for small local fishermen to catch enough food to survive. The really shocking element is that there are reports of dumping of barrels of nuclear waste off the coast. Many of these barrels washed up after the Tsunami in 2004. This resulted in many people dying of strange cancers and diseases.
Could it be that the Somali's are actually defending the territorial integrity of their waters? Could it be that the Europeans and others have ignored requests for compensation or protection of the Somali's coastal waters? Perhaps this is how you have to do it - take matters into your own hands when your interests are ignored by the west!!
I am shocked and disgusted and once again convinced that Africa is always framed in the dark ways that benefit the Africanist perspective that dominates western media (it smacks of the famous Edward Said's famous "Orientalism").
Read the article and tell me what you think: http://tinyurl.com/7y4lc3
Wednesday, January 7, 2009
The emphasis on this type of local is based on the belief that small, locally based economies are more stable and resilient when they are not dependent or financially integrated into the global economy. This is a thinking of the global and local within a dichotomous framework - seeing the global as something separate from the local and therefore something to separate from or become distinct from. What is true is that globalization operates differently in every space and is geographically and historically constituted and therefore different facets and experiences of globalization are produced in every local economy.
The understanding that the local currency movement operates from assumes that globalization "impacts" local communities and is largely a-historical and is therefore something that is imposed upon us and must therefore be fought against. This is like talking about our different organs from the perspective of the "impact" that the human body as a whole has on a particular organ. This, as we know, is folly and is not the most constructive way to handle an issue that is "localized" - if my lungs are giving me problems I don't look at the entire body and say that we need to remove the lungs from the "impact" of the body. The two can not operate separate from each other. Globalization is local as much as it is global - it takes the local to produce the global. We, the people, are the ones that have created and continue to create globalization and we can create it in any and all forms that we may desire. It is not something that is predestined and designed - it is not something that operates separate from us.
The logic that is used to go from a critique of the monetary system to a critique of globalization is problematic to me. I, personally, see nothing wrong with globalization - especially the type of globalization that is rooted in interconnectedness and flows of information and goods across "physical" boundaries (I also think that globalization is an experience that is part of human existence - the sharing of ideas, goods, languages, etc) . I do not believe that we can, nor need to, end "globalization". Ultimately globalization is made up of many, in fact an infinite amount of "local economies". What is problematic is that the blood (money) that is pumping through these economies is somewhat toxic - as if the economy has drunk too much alcohol and is self-destructive.
Globalization is not the problem, nor is the loss of the "local". Rather the problem is the incentives and values that are rewarded and promoted within the current economic system which in great part are guided and driven by the way we create and construct our current monetary system. The alternative currency movement will find greater success in finding ways to integrate and relate to the global economy rather then viewing itself as in "opposition" to or in a process of "re-localization" as something that is against the global economy.