Saturday, 22 October 2011

Why we are the 1%...

We are the “one percent” it seems.  We look up from the mess on the floor, point at the most likely culprit, and say; “them, there, they did it – it’s their fault, they made us.”

As we sit in our warm homes with HD TVs, computers, walk-in fridges and other wonders of modern living no-one remembers how the terrible things the bank did helped us to have those things – how we got a slice of the pie too.

And next time we leave the house – sliding into plush, fast motor cars with in-car music systems to visit exotic restaurants or shining picture palaces – we won’t consider that that bubble created these things.

And gave us better health services, improved school facilities, new roads and subsidised care for old folk. Not to mention a gold-plated welfare system and a seemingly endless production line of government jobs and grants.

As these marvels of modern consumer living arose, we didn’t ask; “excuse me sirs, where does all the money come from to make these things, to buy these things?” No, we got out our credit cards, took out the equity release loans and went on a binge. A binge fuelled by governments entirely to serve a political end – the justification of two things.

The first was the consumer society – not the caricature painted by Naomi Klein and others but the real one. The idea that government, through the maintenance of low interest rates by fiat, could ensure the permanence of economic growth. The pseudo-Keynesian canard that it is demand that drives that growth – so forget savings and spend, spend, spend!

Secondly, we saw the absolute triumph of the so-called “mixed economy”. With Blair’s “third way” and Brown’s end to boom and bust, we were present with the culmination of social democracy’s dominant idea – that the heights of the economy can be directed by the state. And that the profits of that direction could be directed to wider social benefit.

We voted for this. Not just once – never to do so again. But repeatedly – we allowed politicians to promise us the moon and stars without asking where those celestial baubles were to come from or how we would pay for them. Mostly, our reaction was something like: “he’s got loads, you can take more off him”; or else, “take money off those doing bad things – we don’t like fags let’s tax that more.” And when we got stuck, hey we could borrow a little more. It wouldn't notice.

The deal failed. It failed because governments got ever greedier for power and cash and bankers exacted a bigger price for the Faustian bargain with financiers.

Today we see protestors unsure whether they should call for some nihilistic endgame, the destruction of the state and its agents, or for the restoration of what was, for the rebuilding of social democracy through borrowing and printing money.

Not one of these protestors seems to point at the Emperor’s nakedness – to point out that the mixed economy failed, that we all tried to borrow ourselves to prosperity.

Maybe it’s because we're the Emperor. It's us that have the new clothes. 



Anonymous said...

bravo!well written and on the money.

Asim said...

Pretty much what I've been trying to argue with people, but much more eloquently put!

Asim said...

Pretty much what I've been arguing with people, but much more eloquently written!

David Hadley said...

Well said.

Have you seen this, also sums it up nicely, I think: