The malady of infinite aspiration
In the first of two issues of Esprit devoted to the economic crisis, editor Olivier Mongin argues that market crashes are less the fault of ignorant or irrational traders and more the result of a broader historical trend in politics, philosophy, and aesthetics. Since the nineteenth century, value is no longer a property of each object or idea, but determined by the price it will fetch on the market.
Enter the herd mentality: traders who expect the market to move in a certain direction buy and sell accordingly, and so cause the change they have predicted. Politics and the media are plagued by the same self-destructive introspection. Without stable values, politicians and journalists try to anticipate what the public wants, and attempt to buy into a rising trend. As public discussion converges on these predicted beliefs, it propagates them through society — prophecies that self-fulfil.
One current consensus, notes André Orléan, is that the financial sector needs more regulation. Look deeper, though, and ideological differences remain. The dominant perspective sees markets as sound in principle, merely distorted by concealed risks. Regulate to increase transparency, and markets will get back on track. This view is opposed by those who note that bubbles and crashes appear in the most transparent markets. Markets are too volatile, this group holds, and would best be helped by keeping them connected to the economy of the real world. These fundamentally different approaches deserve to be publicly considered, argues Orléan, and not relegated to technical discussions between economists.
Cognitive capitalism: With factory labourers having been replaced by a new creative class of knowledge workers, says Yann Moulier Boutang in interview, intellectual property is now the main form of wealth. This changes class relations: work can no longer be left behind at the factory gates, but takes over the entire life of the worker. The most valuable contributions — ones that create and mix ideas of social value — are precisely those that cannot be recognized by the current economic system.
The full table of contents of Esprit 11/2008
Blätter für deutsche und internationale Politik 11/2008
In Blätter, economist Heiner Flassbeck considers the consequences of the “panic in the financial casino”. Friedrich Hayek believed that the market regulated itself by amalgamating the independent information of its millions of participants. What today’s liberal economists and politicians have failed to grasp, writes Flassbeck, is that the “really big games” are played by “a handful of privileged actors who are remotely controlled by a few bits of information which flash permanently across the screen and which are interpreted by everyone in a similar way”.
“When certain events occur, for example a boom in raw materials, or interest-rate hikes between states, almost all players jump on the gravy train and try to earn a fortune. That goes well until the moment when they have driven the price or the rate of exchange so far from the real value […] that it is no longer possible. Then the whole game collapses.”
Financial markets generate dangerous toys and must be massively regulated, argues Flassbeck. “Bragging about extreme profits must give finance ministries and central banks cause to check at whose expense these profits are being made. Managerial salaries must also have caps set by the state, since it is obvious that managerial boards expect the state to carry part of the losses. Were that not the case they would check more thoroughly where their profits were coming from and what risks were attached.”
Italy: Susanne Böhme-Kuby interviews Valentino Parlato, co-founder and president of the Italian communist daily Il Manifesto. Parlato criticizes the centrist politics of Walter Veltroni’s Democratic Party as a misjudged attempt to create a US-style “container party” that would attract floating voters. In fact, in the last elections, the PD succeeded only in drawing the anti-Berlusconi vote from the far-Left alliance. “That shows how distant the party leadership is from the voters. It no longer addresses policies at concrete human beings, but does politics for the sake of power.”
The full table of contents of Blätter für deutsche und internationale Politik 11/2008
Mute 10 (2008)
Forget inflation, it’s deflation that we should be worrying about, writes economist Jon Amsden in Mute. The injections of state cash have failed to kick-start the economy because, “despite everything you have read, the sudden shortage of bank credit was not the cause of economic slow-down but, rather, its effect. It was the fact that people were losing their jobs and couldn’t pay their mortgage payments due to the economic slowdown that caused the housing crisis and not the other way round.”
If, as Marx argued, profits fall as the labour-to-capital ratio shifts in favour of capital, this would explain the “export of capital” to developing economies — “where the capitalist gets to accumulate most prodigiously the source of all surplus value which is human labour time”.
“The result now seems to be that the productive sectors of the mature economies are running down just as the financial sectors are becoming wealthier than ever. The result is ‘funny money games’ in financial markets, including the creation of useless economic derivatives, the ‘lending’ of capital to developing nations and the hectoring of less developed nations by the IMF to make them pay their debts.”
This, argues Amsden, is where deflation sets in: “When the US economy completely collapses in both the financial and real sectors, the total collapse of the banks will follow with widespread corporate failure and the increase in unemployment to unbelievable levels. Under these circumstances, demand will fail and prices will fall through the floor.”
Food crisis: George Caffentzis argues that the global food crisis was a calculated attack on those who oppose the privatization of land and natural resources: “To blame [the food crisis] on higher oil prices or on the diversion of acreage to biofuel or the increased demand for soyabeans in China is a cover up. […] Biofuel production is perfectly in tune with [the World Bank’s] policy recommendations that have systematically prioritized the commercialization of agriculture and profit maximization at the expense of subsistence needs.”
The full table of contents of Mute 10 (2008)
Dilema veche 242-246 (2008)
In Dilema veche, Sever Voinescu believes that capitalism itself is not at the root of the present crisis. Looking at the ideology behind it, however, he finds that it has been steered by a glorification of greed and a lack of common sense as well as an absence of any moral conscience. The result, says Voinescu, is that we are learning a rather obvious lesson: greed is not good.
Gabriel Giugiu continues with a critique of the American Federal Reserve and the decrease in interest rates intended to encourage economic growth. It had immediate effect and formed a model for many other countries. But it was a short-sighted move with short-term results, distorting more markets than the ones in the US. The point is further illustrated by Dan Carp, who looks at how the real estate industry is affecting ordinary people in Romania. Carp is waiting for the real estate bubble to implode with the lack of transactions and the increase in bankruptcy.
In issue number 247 (table of contents not yet online), editor-in-chief Mircea Vasilescu notes how the financial crisis is reimposing the divide between eastern and western Europe. “The themes of the ‘united Europe’ have been pushed into the background of late, due to a lack of time and interest — national governments are too busy conceiving anti-crisis solutions. Economically, they might be successful. But the ‘costs’ may include imposing (or deepening) an opposition between the West and the East, between ‘Old’ and ‘New’ Europe.”
Comparisons: As member of the EU, Romania is becoming ever more aware of its comparative role in the region. Its friendly competition with Bulgaria has lead to a new consciousness of what the two countries view as their poor relative, Albania, a country facing even greater poverty and corruption than the two former countries, writes Gabriel Giurgiu.
The full table of contents of Dilema veche 242-246 (2008)
New Humanist 6/2008
Banks collapsing, homes repossessed, jobs disappearing… no wonder the world is in despair. In New Humanist, sociologist Steven Lukes turns to Emile Durkheim to make sense of the financial crisis.
In an article bulging with compelling quotes, Lukes claims that if we want to consider the morality of capitalism as a matter of wide-ranging public debate there could be no better place to start the discussion than Durkheim’s Suicide. In this classic work, published at the end of the nineteenth century, Durkheim develops the concept of anomie: “the malady of infinite aspiration”. His central idea, writes Lukes:
“…was that human beings need regulation — a framework of informal and formal rules that set limits to what they are entitled to expect, for instance, in the form of economic rewards. It is an idea that contrasts sharply with the culture of capitalism, not least its US version. Could there be any more striking contrast with his idea than the culture of Wall Street and the City of London in the last three decades?”
60 years Human Rights: On 10 December 1948 the General Assembly of the United Nations adopted and proclaimed the Universal Declaration of Human Rights. Since then, critics from all sides have seemed determined to dismiss this document as “either vague posturing or dangerous leftism”, writes Conor Gearty.
“And yet, despite the double standards outside the academy and this range of scholarly doubts within, the Universal Declaration of Human Rights basks today in birthday acclaim as the greatest international agreement ever achieved. Nothing seems to have the capacity to topple this mission statement for humanity from its moral pedestal. The world views the sixtieth anniversary not only as a cause of celebration but also as an opportunity for an ethical health check: how are we faring by the standards our grandparents’ generation set for themselves?”
Also to look out for: In a refreshingly balanced article, Stephen Howe chases the storm of controversy surrounding the ideas of Edward Said; from Havana, Roger Davidson reports on a country struggling to free itself from an atheist revolution of an older vintage; and Kerem Oktem finds Turkey caught between Islam and ultra-nationalism.
The full table of contents of New Humanist 6/2008
Wespennest 153 (2008)
“What does resignation mean in our modern society, where believing in success, money and private happiness” have come to seem compulsory, asks Wespennest editor Jan Koneffke. Resignation is a luxury, writes Giuliano Mesa. Dismissing the allegation of “cheap rhetoric”, he insists that attention be paid to the individual victims of a small minority in pursuit of limitless and obscene wealth and power.
“The resignation of the starving cannot be compared to — and probably isn’t even distantly related to — the resignation of someone who, in a wealthy and overfed place on the planet, despairs out of frustration.” Mesa strongly criticizes the prevailing resignation “in the face of the dominance of economic logic”. As an alternative to the myth of eternal progress, Mesa suggests it is the past we should try to change.
“To change the past can mean to work on the causes. To refuse to conform to the ‘logic’ of power, money, success. Not only the refusal to subject oneself, but also the refusal to subject others. Not to accumulate wealth, not to consume beyond necessity. Not to seek the applause of the media, to refuse to make one’s identity dependent on appearing on TV and in magazines. The sheer ‘I would prefer not to’, the method of (Melville’s legendary scrivener) Bartleby would be a lot.”
Resilience: Andrea Roedig’s phenomenology of resignation leads to a defence of resignation as “controlled despair”, chosen by Irena, the youngest of Chekhovs Three Sisters. Irena serves as a plea for “stubbornness, for measured defiance against fate. Despair keeps the wound open, a reminder that she did not surrender voluntarily. She complies, but she doesn’t forget what her wish would have been. This might not be the most prudent attitude, but it is wise insofar as it keeps tangible what has died in her. What more can life be? Resilience, in other words.”
Also: Jonas Thente writes that recent literary debates in Sweden have dwelled, among things, on authors’ love lives and penchant for designer handbags — yet there is more out there if one looks; and Jamie Peck on how creativity strategies have been crafted to co-exist with urban socio-economic problems, not to solve them.
The full table of contents of Wespennest 153 (2008)
Le Monde diplomatique (Berlin) 11/2008
In Le monde diplomatique (Berlin), Heiner Flassbeck and Friederike Spiecker explain the concept of saving: while we assume that we somehow “deep-freeze” our money by putting it into a savings account, reality looks somewhat different.
“The sum of the monetary assets in the world is always nil. Every saving in the form of money equals a debt in the form of money. The savers are the creditors, people who believe the earnings they lend will sometime in the future be paid off. Whether debitors will actually be able to pay off their debts along with the interest, depends […] on the future ability of the debitors to use this stock of capital to generate goods.”
If, as is currently the case in the US, the debitors are not able to pay off their debts, because the loans weren’t covered in the first place, the whole bubble bursts. For years, various countries made use of these “dubious lending practices”; in Germany, for example, a combination of wage dumping and a national “saving fetish” raised competitiveness artificially.
It is about time, Flassbeck and Spiecker write, to start thinking in macroeconomic cycles again. To reduce interest in order to encourage investment in material assets and not in money would be one remedy. To accept wage agreements that cover the average increase in productivity as well as inflation would be another. Ultimately the crisis we are in “contains the opportunity to (re-)establish an understanding, among academics, politicians and the media about the basics of a stable, successful and at the same time fair market economy.”
Blood and lead: Drug trafficking, el narcotráfico, is “a highly productive industry” in Mexico and constitutes a whole “second life” in the country, writes Juan Villoro. Corrupt politicians, police officers and judges; lack of transparency and a failure to communicate on the part of politicians; a severe lack of freedom of expression; and excessive violence characterize the country as it is today. “Welcome to the decade of chaos! Eight years after the democratic shift of governmental power, Mexico is a land of blood and lead.”
The full table of contents of Le monde diplomatique (Berlin) 11 (2008)
In a consumers’ world, the consumption of cultures may sound quite reasonable. But it may acquire a deeper significance when applied to cultural exchanges and the search for origins — as the Brazilian author Oswald de Andrade did in his Cannibalism Manifesto (1928), likening it to ritualistic cannibalism or anthropophagy. Humans have ritually consumed humans hoping literally to ingest their virtues. A culture may gobble up another; absorb what it finds useful and, adding this to its own original virtues, create a synthesis.
Along these lines, Mele Pesti discusses its manifestations in Estonian culture. “Let’s be Estonians but become Europeans as well!” urged the Young Estonia movement at the beginning of the twentieth century — an essentially anthropophagic appeal demonstrating that although the metaphor of anthropophagy was not familiar in Estonia, its underlying thinking, which involves “a critique of cultural imperialism as well as a distinctive project of nationalism”, had a broader currency in smaller cultures exposed to the great European narratives.
Tarmo Jüristo continues the culture cannibalism theme with a look at “first-contact” tourism in Papua. As the former cultural Others are becoming ever more familiar, the search for peoples as yet untouched by western culture has become an industry in its own right. Armed with Lonely Planet guidebooks, westerners invade the remote corners of Papua — and the locals must take care to keep their mobile phones out of sight. But the real cannibals are the travellers and tourists, anthropologists and publishers who consume “primitive tribes living in the Stone Age” in order to satisfy their hunger. Whether it is hunger for exotic experiences, for knowledge or recognition, “it is the traditional peoples of Papua, Oceania, Africa, and South America who are being taken from, being offered candy and cigarettes in return,” concludes Jüristo.
Also: Images of the Gas Pipeline created by architects Maarja Kask, Ralf Lõoke, and freelance artist Neeme Külm for the Venice Biennale of Architecture, highlighting the presence of infrastructure elements in our environment and the increasing role of political decisions in shaping it.
The full table of contents of Vikerkaar 10-11/2008
In the introductory editorial, “Capital of culture or cultural desert?“, editor-in-chief Emica Antoncic comments on the recent difficulties that Maribor culture has been having with the municipal government. The reduction of budgetary funds available to Dialogi and to the book programme of the student publishing house Litera, as well as the failing efforts to relocate a youth culture centre, has dire effects. Now the representatives of the established high culture in Maribor, as well as the urban youth culture, are forced to justify their existence at every turn.
The failing communication between municipality and culture and inconsistency in municipal cultural policy, which cuts funding for culture even as Maribor is a candidate for European Capital of Culture, is likely to have fatal consequences and lead to the exodus of intellectuals and artists from the city because they feel their existence is untenable, writes Antoncic.
Stigma: Inspired by the publishing of the Slovene translation of one of the fundamental works of the sociologist Erving Goffman, Stigma, the main part of the issue is devoted to stigmatization in contemporary society. Mirjana Ule introduces his works, which deal with the issues of discrimination, exclusion, monitoring, and impairment of the self. Further contributions deal with stigmatized identity, from gender identity through praxes of identity politics and attitudes towards foreigners, to body image and weight loss.
Political theatre: Andreja Kopac has talked with Sebastijan Horvat, currently one of Slovenia’s most successful theatre directors. They had a lively conversation about the return of political theatre: “For me, something is political if it directly opposes the authorities. And that in this radical way you look for some sore point in the ideology of the ruler you provoke.”
The full table of contents of Dialogi 10/2008
Kritika & Kontext 36 (2008)
Kritika & Kontext (Slovakia) features work by the Slovak-American poet Daniel Simko, who emigrated with his parents to the US after the 1968 occupation of Czechoslovakia and died there in 2004 at the age of 45. The ten poems published in this issue appear in Slovak translation (by the poet Lubo Feldek) for the first time and are taken from the forthcoming collection White Keys, Black Keys. Simko visited Slovakia after 1989, though, as suggested by the poem “Final Instructions from Bratislava”, his sense of loss remained deep:
You have been allowed to go home.
Some invective, you suppose.
All that bleeding was for nothing, repaired quickly.
Accompanying the poems are contributions from the collection’s co-editors, Jim Reidel and Carolyn Forché. Reidel writes: “I and my collaborators had to stand up, hear, really see all of these fine poems, and the hearing part for me, anyway, was like trying to hear what a dying person is trying to say at the end: Is it a thank you, a confession, or a curse?”
East translates East: Articles from the project “Diagnosing the present”, supported by the Next Page Foundation, in which three eastern European members of the Eurozine network exchanged texts (all translations here). Here Kritika & Kontext focuses on populism: Ivan Krastev (Bulgaria) writes that new populist movements do not aim to abolish democracy but on the contrary, rely on the support of increasingly illiberal publics. Svetoslav Malinov (Bulgaria) describes how populism feeds off two phenomena: hatred of political parties and the emphasis on an alleged contrast between ordinary people and the political elite. And Almantas Samalavicius (Lithuania) argues that “high post-communism” in eastern Europe is defined by efforts to control collective memory, political discourse dominated by abstract concepts, and the cult of entertainment.
The full table of contents of Kritika & Kontext 36 (2008)