The Social Contract

John Locke is among writers who have said we have a duty to act when the social contract is broken.  One can no doubt pick up a definition at Wiki.  I contend the social contract is now so broken we don’t have one and need a revolution to establish a new, modern one.  We need to think of revolution in modern terms too.  There is little point inflicting the Russian curse of living in interesting times on ourselves and the track record of street rebellion leading to substantial change and bringing genuinely benevolent government is poor.  In the animal world changes in leadership generally bring more of the same, the issues so built-in to the genetic-environmental flux that a new leader may change sex and grow to take on the role.  In social mice one can ‘train’ a weak member of the masses to take on the despot running the show and keeping all others under the thumb, but the new king is just as despotic as the old king.  We humans may pride ourselves on our difference from animals as rational beings, but this is often little more than a mask for our ignorance of biology and ourselves as social animals.  Our behaviour and evolution is influenced even by the bacteria we carry about in and on our bodies.  What we are and are becoming is viewed in terms of the hologenome.

There is little room for doubt that we are now ‘burning the rock we cling to’.  In respect of this we are not listening directly to climate scientists – a matter typical of mass involvement in argument through indirect social-technology designed to prevent any modern fellowship of rationality.  We have a financial system that clearly tips most of our money down steep hills to a tiny number of rich.  The world in which economies can ‘grow’ is dominated by trivia and Soviet-style control of performance management achieved almost literally by giving sugar to our sweet tooth.  I would say a paradigm case of this was David Cameron’s speech at Davos.  How could an ex-Etonian, bastion of priviledge man, son of a lineage using tax havens, from the very country containing the City of London that is hub to off shore looting, with banks laundering criminal and tax evading mega-billiions being bailed-out of its gambling debts from ordinary hard work, be taken seriously by a rational audience on claims the very banksters involved have been asking him to put things right and bring the light of transparency?  Such promises have been made time and again during the 40 years in which the majority have been dumped into debt peonage.

That the social contract is broken is barely in doubt.  Whether people have the facts on which to decide is much less certain.  My own position is that we should try the kind of intelligent private debt jubilee Steve Keen talks and writes about.  My reasoning in this is not directly economic, though Keen makes a good case and the arguments against are largely ideological postures in favour of more of the same mess.  In essence we need to try something that doesn’t involve clown-Utopian outcomes like Soviet Paradise or ‘Great Leap Forward’.  We are social animals not socialists by nature.  There is something directly democratic about giving money to the majority of people to pay down debt or invest and plenty of historical precedent (see David Graber’s ‘Debt: the first 5000 years’) – though as Keen points out we’d need something systemic and more sophisticated.

The issues are not merely ones of economics.  I have long felt, in teaching the subject, that the whole scheme of it is a control fraud relying on the Unsaid in its arguments.  The big Unsaid concerns non-democratic foreign policy and unspoken attitudes that the world is a dirty place, human nature rotten, and we need our leaders free of ethical constraints to combat the inevitably immoral enemy.

At the personal level I’m sure the social contract is broken because I no longer vote.  There is generally no one standing on policies I could vote for – I do vote Green if the chance comes by and would turn out to actively support any modern equivalent of E D Morel (who unseated Churchill in Dundee).  This system effectively disenfranchises people like me and I now think our main political parties are either infiltrated or subject to iron laws of the Weberian type that prevent any modern discussion.  In the UK we are now promised a ‘yes/no’ vote on membership of the EU (irrelevant as other than a vote appealing dodge) but nothing on a coordinated private debt-relief plan to re-schedule a sensible, modern investment in production and capacity to make lives and the planet as safe as we can.

My real escape is to the day job and protecting myself and my own.  There is no politics to engage.  Key economic issues like leadership and its control are barely discussed.  The employment relationship is now HRM dogma, much of which smells of roses whilst the real issues are global wage arbitrage for profit and loss accounting that conceals massive unemployment and under-employment.  Wages and liquid assets held by the many plummet and we educate people into debt without any thought on how to generate the ‘work smarter’ jobs, other than in parasitic financial services.

Financial services as we have them are a contradiction.  Just as the State was supposed to wither away in socialism, so it was hoped would the rentier-class.  I now rely on RT and Al Jazeera as friends behind the Iron Curtain once did BBC World Service (I do spot the propaganda line).  The rentier-class are like the kids who threatened to take their ball home so the rest of us would be stuck with nothing to play with.  The contradiction is they set the rules and yet we are supposed to be free, democratic citizens who can make our own.  We can’t set decent wages because various far-eastern and south Asian workers will take them and render us non-competitive.  My grand metaphor on this is a police force formed with the cheapest foreign labour – but in effect this is wage freeze, pay and numbers cuts.

As a kid I believed British men were good at soccer!  Now the Premier League has only a third of its players home grown.  I live two doors from a guy who played Test cricket and remembers a time when sports heroes weren’t a separate financial class.  Some sports have wage caps and an ethos of the competition itself rather than mere personal and team success.  In the end I’m not concerned that sports success is now business success, the best businesses buying the best players – because I really have no interest at all.  Money has destroyed what used to interest me.

Other models of finance and competition are available to us.  They are ruled out before any teaching or analysis begins.  This is essentially why economics is a control fraud and not a science.  I doubt we can plan an equal society – how can I ‘equalise’ my friend’s blindness (he does a fair job)?  But we can plan competitions – anyone who does the background work to allow me to play in a cricket league can vouch for this.  We could have candidates standing for election on the basis of a private debt jubilee and a financial competition with transparent regulation and a politics not infiltrated with private money.  This would entail democratic control of foreign policy – and this is the stumbling block.  In the West we think we are ahead in the dirty game and would be fools to give up this lead through naive honesty.

The scientist achieves naive honesty by blocking out the Idols of normal ‘reasoning’ at the laboratory door (we all carry some inside – we are human) and constructing carefully constructed special languages with others to discuss and plan experiments.  In some sciences mass is just what we weigh – this approximation is good enough.  In some aspects of physics we are concerned that mass has measurable inertia or gravity – the latter an illusion in general relativity – and some root away for a better explanation than the coincidence.  The central assumptions of various research programmes can be abandoned once enough evidence makes other assumptions more likely to help.

We could be offered a vote now on a debt jubilee and a transparent investment system (etc.).  One could write the plan as a spreadsheet.  I don’t even see this around as a thought experiment to allow discussion of what would work, to allow us to see there are alternatives and so on.  The current mess makes no more sense to me than ritual slashing at my private parts in menstrual imitation and it does look like the crass debt peonage of the Lele.  Almost no anthropology or serious history makes it into ADMASS and precious little biology.  We seem to have ‘forgotten’ there have been other ways to live and that a diet of sweet syrup is not good for the body or soul.

The positive way forward is revolution – but this can’t really be done by the mob. Transparency is the route and I believe this because technology is changing – though currently subsumed into the rich plot as ‘competitive advantage’ (much perhaps as performance enhancing drugs in sport – high frequency trading is a classic front-running scam).  It is now possible to design systems that report in such a manner that having a few seconds advanced tip-off would be irrelevant in financial trading.  The game of chess isn’t much if you can’t see your opponents pieces and moves.

Against the products and services we buy and use, financial services is a cost and we would normally expect such costs to be minimised by competition to a fair level.  The alleged ‘contribution’ of financial services is dubious, both in terms of how it is accounted for and whether it could ever be a contributor at all.  It’s hard to think, say, in war time, that we would be combing our populations for financial services people rather than soldiers (though the role of financial services in creating and in wars is another matter).  The bank and insurance clerk and manager would be unlikely ‘essential occupations’.

I believe most financial services are routine and could be subject to knowledge embodiment in machines – this is already in part true, the problem being access to the technology, a common problem with management information systems.  We have done this with many artisan skills and only “union” resistance prevents a lot more in professional areas.  My guess is the biggest barrier to the embodiment of financial skills in machine driven utilities is this removes the opportunities for control fraud and theft.

If we could level the playing field (but remember even dry, level playing fields favour those who play on them regularly and the mud heap at Hartlepool in the rain is a great leveller), we are left without the cheating competitive advantage that currently allows 10% ‘defence’ spending by the US umbrella – we have to address these matters globally – yet we must address them without this being an excuse to give up.

My way forward would be a mix of systemic private debt relief (if you don’t have any you’d get something to invest) and international public service to replace some of further and higher education and unemployment.  In the detail of the plan we would be looking to return any public investment to the private and social enterprise sector.  As a planner I believe the effort involved would be similar to war planning and my guess is we will have war instead.  A missed element in everything I have read concerns equipping people for the jobs they do and ability to grow in them, and to grow more essential, productive, green capital through this involvement.

The current farce in higher education produces graduate kids who have had three more years of child minding.  Employers claim (rightly) they still don’t have needed skills, but have generally been useless at really identifying what these are, or whether we can knock them into sows’ ears.  These kids are also saddled with debts the size of my mortgage.

I don’t believe this is Utopian thinking – I’m more concerned that we are reduced to impotence and hopelessness.  I have lied and cheated to obtain and spend research funding, banged a few villains up and know the world is a dirty place.  any plan we put in place would have to be managed and that gives the performance managers the chance to ruin all with ‘soviet-statistical’ lying.  This is just one element we can’t get rid of through bureaucratic rules and only by forming a system that doesn’t favour the bureaucratic toadies..

Time To Junk Economics

Africa, that well known collection of basket-cases, has long been a net exporter of money even after aid is taken into account.  This is known as capital flight.  These externally held assets are held by a small minority and the countries’ public debt is paid for by everyone else.  A number of university studies have shown this and the sums are in hundreds of billions.

The majority of the world’s wealth is held by very few people and we now regularly hear of the ‘one percent’, but I meet few people who understand much, if anything about how this wealth is amassed inn so few hands and what this form of capital actually does, other than making a few incredibly rich.

I think we can safely assume the wealth of the one percent has little good effect on raising living standards for the many.  It’s been around and getting worse for centuries.  It may be possible to argue that all improvement in this sense may be done to massive improvements in productivity due to increased knowledge and technological innovation, though these may have some link to the focus of wealth (we wouldn’t have science without people otherwise idle enough to do it).

As a scientist, rather than someone who teaches low-level university economics to make a crust, I find economics an intolerable discipline in that it fails to address itself as a history of mistakes and is predicated on ‘world-views’ rather than more modest research programmes.  It is not possible, as a scientist, to think that such issues as capital flight, offshore tax-dodging and other obvious cheating, or such matters as a small number of people needing the motivation of great riches while others starve, can form the core of a research programme.

Sociologists generally don’t like explanations of capitalism as only existing because people are incredibly dumb, but frankly, when one looks at what we are expected to swallow on the needs for mass austerity and to let the rich get even richer, the levels most people can achieve in universal education, widespread scientific illiteracy and global competition really being about depressing wages and conditions of employment, and getting people who aren’t smart to worker smarter (as we import smarter people because this doesn’t work), along with what passes as mass entertainment and research on just how dumb human communities have been in various ecocides and wars … then evading questions about how human dumbness comes about hardly seems scientific.

My thesis is that we are almost chronically dumb and can’t face up to this (none of us is exempt).  In one of my favourite Voyager episodes, Janeway not only refuses to drop her pants to get technology that would get her crew home, but tries to trade the sum total of human literature for it – essentially trying to trade what you’d be stuck with on a desert  island (of the radio show) for technology that shrinks space.  We live with fantasy like this in a world in which women and children are traded to much worse fates and in which we are all traded in an economic system beyond democratic sanction.

My guess is we could know about economics if we studied the issues from a fractal perspective.  I don’t mean the creation of a new set of mathematical wangles that mean ‘there’s nowt down for you Son, ‘cos you can’t do this kind of counting’.  There are structures that seem to repeat themselves in human affairs, including repeated numbskull behaviour by majorities and minorities.

My start is in the non-human and the way bacteria, plants and animals behave.  Much we see as human can be found in this.  Ants ‘take slaves’ by stealing the eggs of other ants, many insects are involved in ‘complex gardening’ using anti-biotics and there is much ‘chemical warfare’ practised – none presumably needing the kind of rational mind we attribute to ourselves.  Chimpanzees act to ‘police’ their societies (so no change there then!).  Many species are now extinct and it’s clear our own almost was.  We need some understanding in economics of how we are borne in evolution and are not in mastery of it.

Human history as it is taught around the world has structures in it.  My guess on these is that the first is that it is taught everywhere inaccurately.  What’s the difference between Jihad and Crusade or the various empires that have hardly graced the Earth?  What’s the difference between the ancient tribe in Peru who ‘mastered’ water supply and died horribly when their claims to deal with ‘water-gods’ was exposed in drought and the current Mob of banksters and their claim we can’t do without them?

Some way into an examination of such structures, come questions on whether competitive advantage is actually ever used in any way we can consider moral?  What other structures might be similar and/or at work – one can think of the bee hive, termite mound and social mice (where Bossmouse keeps his order through the enforced poverty of others).

There is much more to say on structures we might expect to find at different scales in our society.  The fraud we are encouraging in capital flight and investment banking may well just be a structure as surely as that of a set of genes turning on encouraged by the environment (exercise immediately causes gene activity).

Competitions really only work through rules and refereeing.  What one can compete on is restricted or we might say, structured.  We could choose to structure such matters as salary caps across work places from sport to banking.  It’s also possible to see much of the notion of motivation to great wealth as giving up to libidinal structures.

In longer term looks at structures we get laughable stuff like Elliot Waves (his other book was on running a tea-shop), but we rarely look at what has always been promised to society as a whole by putting up with economics and what has actually been delivered (a lot – not much?).  My own country (UK) has failed to produce even all its own medical doctors and steals them from countries that cannot  afford to lose them.  What does this say about working smarter and the role of training and education?    Surely if we could do so much better by getting higher skills we’d not only be producing all our own doctors but also making money hand over fist training those of other countries in our splendid and efficient medical education?  We ain’t.  And now we have kids taking on huge debts to get the “advantage” of a degree to work in a coffee shop.

If education is about employability (it ain’t – but no matter) why do we divorce it so much from the world of work?  Some dork brandishing a business degree from the places I’ve taught in, is no more employable or knowledgeable on business for real than anyone else with a non-numerate degree in anything else, and less employable than someone who sensibly left school at 16 and went to work for Sainsburys (where I know management juniors get a better education than I can offer).  So where are the economists saying we should junk much of higher education and get on with a job-based expansion because you’re only going to learn about work at work and only learn work-skills by using tools and machines?

The economics we have is such junk we have a Chancellor telling us his coming budget will be for growth and work – when it will offer more money to the rich and continue to cut the public sector.  Osbourne is crap – yet if economics is so bad we can’t even see through his jive it needs to be junked.

We need to look more closely at intractable problems like arming the police

Many arguments in the public domain rely on what we think the consequences of change will be.  I’m broadly in favour of arming our police officers with tasers and handguns and improving response time in getting expert markspeople to scenes where necessary.  One can see potential problems – there are rogue cops and more obviously armed police could lead to more obviously armed criminals and so on.  It might disappoint some, but I’m not far from the position Gadget fairly regularly outlines on this particular topic.  I want to see a different form of regulating our police, but really want them to have the tools and back-up in the CJS to do the job.  Currently, I doubt this is the case either for police doing their job or for the public who need their help.

I’m not interested in policing per se but the wider problems of society.  Frankly, I don’t think social science and philosophy are much help in this.  The people doing this stuff are too often up themselves and stuck in their own interests and soaked up values.  Very few put their work into the broad public domain as , say, Steve Keen (economics) or Alain Connes (maths) who can be read for free.

If we start to think through the consequences of arming our police, I’m sure we would quickly come up with good and bad.  What interests me is how quickly impasse is reached even over such a simple matter.  What chance then of Keen’s (and others) ideas on radical social change in forgiving debt (a regular feature of our history – see David Graeber) and returning to banking focused on productive work and innovation in a real economy?

The problem is that human beings do very little thinking and are broadly content with habit. The irony of my teaching might be summed up as ‘brow-beating people into thinking for themselves’.  One or two of my own teachers worked this miracle on me in the past, and I’m very grateful.  However, the issue of flogging dead horses remains.

In the end, we can’t all decide whether special and general relativity are any good because we have already balked at much lower hurdles like basic algebra.  Universal education has obviously failed to turn us all (or even many) of us into scientists or creative thinking individuals.  One idea developing from modern brain science is that we make few rational decisions and rely on a kind of unconscious reasoning.

I think science is mostly straight and that matters like banking (as banksterism),politics and economics largely bent – like the Emperor’s New Clothes.  I have little problem with elite groups doing science, but am generally sickened by what other elite groups get up to. I can explain why.  The problem is not a matter of explanation – it’s that the way we enter into explanation on social matters is itself the problem we can’t overcome.

I’d like to see questions like whether to arm our police alongside deeper economic issues in mainstream discussion in order to find new decision-making processes based in practice and honesty.



Economics Of The Undead

Work by Bezemer is around on the net showing that the current financial crisis was predicted.  This table is from Steve Keen.

Researcher Role Forecast Date
Dean Baker, US Co-director, Center for Economic and Policy Research 2006
Wynne Godley, US Distinguished Scholar, Levy Economics Institute of Bard College 2007
Fred Harrison, UK Economic Commentator 2005
Michael Hudson, US Professor, University of Missouri 2006
Eric Janszen, US Investor & iTulip commentator 2007
Stephen Keen, Australia Associate Professor, University of Western Sydney 2006
Jakob Brøchner Madsen & Jens Kjaer Sørensen, Denmark Professor and Graduate Student, Copenhagen University 2006
Kurt Richebächer, US Private consultant and investment newsletter writer 2006
Nouriel Roubini, US Professor, New York University 2006
Peter Schiff, US Stock Broker, investment adviser and commentator 2007
Robert Shiller, US Professor, Yale University 2006

My own take started in the shipyards in the middle 80s and what was happening to much of our industry, including the Miner’s Strike and on a wider basis in international experience in textiles markets.  The ‘promise’ was that ‘we’ could make better livings without producing real goods and services by somehow upping our skills on the basis of education and ‘working smarter’.    This nonsense continues to be promulgated and is actually riddled with flaws, all too ‘delicate’ to mention such as some poor sod having to do the work we were deeming low skill.  In fact, many of the old industrial jobs were highly skilled and we have never properly bothered to understand this,  An obvious factor was that you could buy a house and discover your wages were little in comparison with the equity inflation.  We now know “we” were borrowing to survive.

I don’t generally like ‘arguments’ that run against received wisdom of the kind spued out against climate change – but I can’t see any sense in the kind of economics our governments are embroiled with.  There is no science behind them and they have a long history of war causation and a rich living easy on the hard work of others,let alone a dark politics that shames us all.

What I want to develop is the narrative account of a democratic economics.  My metaphor is that of the vampire fighter leaving a memoir to combat the Undead in the future.  The key issue is breaking away from the spell they induce.  Another might be that of the scientists working under threat of instruments of torture.  The Emperor’s New Clothes is a one-size-fits-all almost throughout.  It’s been like a detective enquiry in a trail of false clues.

I do the quantitative bit – but the problem here is that most of the numbers needed tend to be missed out – as with neo-classical economists and debt (which they ignore).  And much we get in figures has already been gamed and one needs to know how.  And throughout, one isn’t working as a scientist able to report to a knowledgeable peer group, but to a power group with vested interests.  All the time,one must earn a living in the system one debunks.  Frankly, it’s as hard as making a complaint against police and you often have to rely on evidence gathered in enquiries you can’t control or assume fair and diligent  and may cover-up what you need to know in promised due process.