Telling it like it is… for a change
Well, the conversosphere is atwitter with the fact that the U.S.A. was just downgraded from Triple-A to a mere AA+. Even though there seems to be little to separate the two, it’s more than symbolic. Certain investment instruments only allow for fixed percentages of ratings levels for its investments. So, this will have an effect of things. But more important–to my mind at least–is it forces some reality to creep into our lives for a change. I don’t have much respect for the ratings agencies–insiders with tremendous amounts of conflict of interest with respect to the financial and economic systems they are supposed to rate or grade–but I have to tip my hat at S&Ps’ description of the current political-fiscal situation that the U.S. is both in and slowly cluing into:
The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed. The statutory debt ceiling and the threat of default have become political bargaining chips in the debate over fiscal policy. Despite this year’s wide-ranging debate, in our view, the differences between political parties have proven to be extraordinarily difficult to bridge, and, as we see it, the resulting agreement fell well short of the comprehensive fiscal consolidation program that some proponents had envisaged until quite recently. Republicans and Democrats have only been able to agree to relatively modest savings on discretionary spending while delegating to the Select Committee decisions on more comprehensive measures. It appears that for now, new revenues have dropped down on the menu of policy options. In addition, the plan envisions only minor policy changes on Medicare and little change in other entitlements, the containment of which we and most other independent observers regard as key to long-term fiscal sustainability.
The financial press was reporting of ‘persistent rumours,’ that S&P would not ‘comment upon,’ about how the ratings agency would actually downgrade the U.S. financial rating and it seemed pretty obvious that it would happen. But I was a little shocked at the frank and sober language used. Hopefully, this will force more politicians to clue into the desperate situation that the U.S. (and the West more generally) is actually in.
Peace.
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The Great Reset… Coming to an Economy Near You
I have not posted much here in the last while, mostly due to good ol’ apathy of late. At a time when humanity should be paying attention to what is going on, we apparently seem too fixated on visiting Royals, global athletic competitions, and celebrity scandals (I say ‘apparently’ since the only way to gauge this is through the filters of the mainstream, commercial media who are themselves overly obsessed with celebrities and scandals. Today, however, I wanted to say something in response to a number of articles I came across during lunch, all of which point to what is ‘coming down the pipe’ as they say:
“Playing Chicken with America’s Future”
Neil Macdonald, CBC.ca July 11, 2011
http://www.cbc.ca/news/world/story/2011/07/10/f-vp-macdonald-debt-chicken.html
“The Head Of The World’s Biggest Hedge Fund Sees ‘Economic Collapse’ Due To Money Printing By Early 2013″
Zero Hedge, July 18, 2011
http://www.zerohedge.com/article/head-worlds-biggest-hedge-fund-sees-economic-collapse-due-money-printing-early-2013
“The impending slow motion doom for housing – can the United States thrive with another decade long decline in home values?”
Dr. Housing Bubble, July 14, 2011
http://www.doctorhousingbubble.com/impending-slow-motion-doom-for-housing-home-values-lost-decades-price-cost-income-ratios/
“The Link Between Peak Oil and Peak Debt – Part 1″
Gail Tverberg, The Oil Drum, July 13, 2011
http://www.theoildrum.com/node/8126
To my mind, these different articles pretty much provide a summary of what is going on right now. Western economic growth has been reliant upon a underlying foundation of cheap petroleum energy. The combination of population growth, globalization, and dwindling supplies of petroleum-based energy are threatening that expectation of constant economic growth. In order to maintain the illusion of constant economic growth, we have become reliant upon finance-related sectors (including the housing market). Since finance-related sectors are little more than monopoly-money-generating Ponzi schemes (ultimately reliant upon cheap petroleum energy), they too are now failing. And, finally, because Western political systems have become little more than corrupt team sports which are themselves reliant upon corporate graft (and the underlying systems of finance and oil production), they are incapable of change. Add to all this a largely corporate-controlled media system that is itself largely incapable of facing reality and a public that is either too uninformed to care or to pre-occupied with mere survival and you pretty much have what we are faced with today.
The only thing left out is the political/military machinations that seem to always be at work.
At any rate, the bottom line is that the global system currently in place is entirely unsustainable and I think we are slowly coming to terms with the facts:
1. Western society is entirely dependent upon cheap energy and the exploitation of the labour and resources of other countries.
2. As globalization spreads, not to mention the astounding population increases, people in the developing parts of the world are expecting to attain some degree of the Western lifestyle.
3. Many of those developing nations are creating increased demand for those same dwindling resources which means that those dwindling resources are increasingly being consumed in those developing countries.
4. The Western standard of living, which the West is desperately trying to maintain and the rest are trying to attain, is ending.
I cannot comment on the predictions of when the “collapse” is going to occur. 2012 or 2013? Perhaps. Someone like Ray Dalio (the head of the largest hedge fund featured in the Zero Hedge article) is much better situated to make such predictions than I am even though everyone knows such things can only be estimations at best. I tend to think of this more like a ‘reset’ than a collapse and it might not happen all at once but is likely a more gradual process (in reality I tend to think that it has already started). That is not to say that it will not be painful. I just think that with something as large and as complex as humanity and the social and economic system we have collectively built, it is more likely that this all will unfold in fits and starts rather than in one giant collapse. (The big question is what will happen militarily and to my mind that is a completely open question.) As I said, I see this as something that is already happening. The large financial bubbles of recent decades are a part of this, as are such seemingly tangential happenings as the popular uprisings in the Middle East, the effective ending of the U.S. ‘civilian’ space program, or the fact that $90-100/barrel crude prices now seem cheap. That all being said, since Western economies are so dependent upon the monopoly-money financial sector, perhaps a large-scale reset in the bond/currency markets will be a cataclysmic event (I am sure it will appear that way to the commercial media). Even so, I don’t think any one is confident in how that might play out.
Peace.
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Thoughts on the Canadian Federal Election
Well, as I initially sat down to write this, it looked like the Conservatives are going to win a majority in Canada’s Federal election. What this tells me is that many people are scared and some are angry. They (we Canadians) rejected the Liberal Party of Canada, elected Elizabeth May, wanted to think Conservatively, and were looking to principles of social democracy via the NDP. Separatists were soundly rejected, people wanted to believe in fiscal conservatism, reject empty politics, and retain the social infrastructure. I don’t really think, as some pundits speculating, that the death of Osama bin Laden had much of an effect in and of itself. Although I suspect the U.S. government/establishment is happy since this will largely guarantee a much more militaristic Canadian government, which is crucial for the U.S., both in terms of having a willing ally and in terms of buying lots of military equipment… both of which are themselves crucial for the dying empire as it tries to retain control of its hegemonic status in the world.
Now, we have to remember that this is the election results. This certainly does not mean this is what the country will get. I certainly do not trust the Conservative Party (or the “Harper Government” as it wants to be known) to be fiscally conservative. (Squandering inherited surpluses even before the financial crisis, spending a billion on security for a weekend G# meeting, and billions in uncosted and no-bid contracts for military equipment is not being fiscally conservative.) And I really doubt that any party (including the NDP or the Greens) is going to do anything serious about the environment, either in terms of pollution or climate change simply because when push comes to shove, exploiting the environment is a necessity in order to maintain our current standard of living in North America.
For me, the most interesting thing is to see the reaction of Quebec. I live in Alberta (‘was born and raised’ as they like to say out west) but lived in Montreal during much of the 1990s and it has been interesting for me to see how similar (and different) Albertans 
and Quebecois actually are when looked at objectively. So seeing Quebecers virtually abandon the separatist party is interesting. The Separatists have a platform that is basically untenable in difficult economic times and serves more of an emotional purpose. The Separatists’ platform is basically ‘separating’ from Canada while still maintaining a system where much of the shared costs of government are forced upon the remaining provinces. Other provinces would never stand for it and the barriers that would be erected because of the formal separation of bureaucracies would hurt economically. I think everyone in Quebec knows that separation is unworkable, especially in troubled political and economic times globally. It feeds an emotional need for Quebecers (which I understand and respect), and a few politicos and power brokers use it to their advantage financially and politically, but it is an idea that makes no sense given the problems facing the world today. It made me think back to a cartoon by Brian Gable of the Globe and Mail (the G+M has good cartoonists, you can check out the April election coverage here: http://www.theglobeandmail.com/news/opinions/cartoon/editorial-cartoons-april-2011/article1966026/ )
It pretty much sums up what Duceppe and separatism mean today. On the political stage federally, the Bloc was politically symbolic but also evidence of just how decadent modern politics has become. The Bloc is the Quebecois way of gaming the political system. In that, it is not unlike a lot of other ways people have found to game modern society–the financiall system is basically a Ponzi scheme–and Gable’s image of Duceppe as little more than a side-show was perfect.
To me, I don’t really see too much to worry about with the results. I am afraid of looking at the results of my local riding as the expected winner is a joke of a candidate (I have no idea what he is like as a person because as a candidate he virtually never… and I mean this literally… allowed himself to answer any questions). I am glad that there will be no election for four years. I hope politicians actually start working for the benefit of the country (and not just their parties and benefactors). And I hope some actual fiscal conservatism starts to guide government officials and the electorate. But as I said, I am neither worried nor hopeful about the election results. It is what it is.
Frankly, given the crap that is coming down the pipe financially and economically, I am not sure why anyone would want to be in power, especially with a ‘majority’ because then it is really your fault when the proverbial stuff starts hitting ceiling fans. And I say that for both Canada and the U.S., as well as many other Western countries… and a few communistic ones too.
Still, we live in interestin’ times.
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Canada, the PM, Political Parties, and Ideological Assumptions
For some time now, I have been actively trying to challenge my own ideology. After years of studying media, propaganda, politics and the ideology of others, I have to realize that when it comes to ideology, it is also an individual’s own ideology–and the assumptions that follow–that is just as dangerous. As I teach and research in the area of media studies, I have realized the necessity of trying to remain–as much as is possible–ideologically neutral. And it has been tremendously illuminating and liberating (even though, to my friends and colleagues, I am sure it is puzzling if not unsettling as I also tend to be a very vocal individual). But it has led me to entertain the idea that we Canadians should outlaw political parties when it comes to government. In most Western democracies, political parties have become very powerful and have turned ‘government’ into ‘politics;’ little more than a game between a few teams (often only two) who fight for political power. Increasingly, this paralyzes government and allows for unelected organizations (political parties) to take control over political agendas and, to a large extent, government itself.
I am sure that in previous decades, say the 1920s (or pick any decade), political parties made sense. In eras with lower levels of education and access to information, political parties might have been useful sources of research, information, and discussion. Today, they are little more than shorthand… they allow people to pay less attention to issues and problems facing society and to focus on winning, cheering, and often meaningless ideas. Today, the political party is power and concentrates power in unelected hands that often exert tremendous control over elected MPs. Due to their proximity to power, they are often the place where other powerful forces (individuals and corporations and interest groups all along the political spectrum) seek to attach themselves. So, it became increasingly clear to me that we should just elect–as many of us do on a municipal level–worthy individuals who will travel to Ottawa and work on behalf of the entire population to run the country.
So, when I came across a post at CBC’s website attached to a story about the current Canadian election where the incumbent Prime Minister, Steven Harper, argued that without a majority he would not be able to protect Canada with regard to international relations, I thought both about ideology and assumptions.
“U.S. border deal at risk without majority: Harper”
http://www.cbc.ca/news/politics/canadavotes2011/story/2011/04/28/cv-election-harper-ndp-1148.html#socialcomments
CBC News
Posted: Apr 28, 2011 11:40 AM ETAn extremely popular comment by RickAshe [a very thoughtful commentator, see: https://membercentre.cbc.ca/ViewMember.aspx?u=8170984]:
Is the coalition “legal” and does it fit within the Canadian concept of “democracy”?
Yes.
The question of who forms the Canadian “government” at any given time is a question of how the members of parliament organize themselves: it can be a majority, a minority or a coalition.
When Canadians vote in a general election, they do not vote for a Prime Minister, nor do they vote for a government. Instead, Canadians vote for a member of parliament (“MP”) to represent their riding in Ottawa. Each MP gets a “seat” in the House of Commons. In all, 308 MPs are chosen.
The Prime Minister is actually appointed by the Governor General (“GG”). The GG, as the representative of the Queen, who, technically, is Canada’s head of state (in other words, the PM is not the head of state). The Prime Minister then chooses from among the MPs to appoint the members of the Cabinet.
As noted on www.thetyee.ca:
The Constitution Act of 1867 doesn’t even mention the prime minister or political parties. MPs are everything.
How MPs organize themselves is entirely up to them. This is why two MPs are able to currently sit as independents; there could just as easily be 308 of them. Most MPs have organized themselves into groupings known as parties. This simplifies the process of forming government but doesn’t change the constitutional pre-eminence of individual MPs.
There is just one basic requirement: The government must at all times enjoy the confidence of the majority of MPs in the House of Commons.
In other words, the Prime Minister and the Cabinet can only remain as the “government” of Canada for as long as they have the support of a majority of the MPs.
GOOGLE: is it legal in canada to form a coalition and check out Canadian Legal FAQS
My reply:
The implications of this fact about Canadian parliament becoming more well-known are staggering.
In recent history (and not just under the current government) the Prime Minister’s Office and the political parties have concentrated and consolidated political power around them. This is made worse since often majority governments are elected with only a relatively small percentage of the overall electorate.
It is time that Canadian citizens take back power from unelected entities. I am even inclined to say we drop political parties entirely, drop the Governor General (and our Constitutional ties to Britain and its monarchy), make the PM a symbolic head (as the GG is now) and make our MPs… all of them… work as government representatives.
I am heartened by the level of interest and often by the level of discourse that is evident during this election (as well as the opportunity to participate). From a media studies perspective, it is all the product of a well-educated citizenry, who have access to tremendous amounts of information and debate (and not just through ‘social media’), who seem to be highly motivated in a very uncertain era.
Peace
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Molina on Libya
I took some time to look at various editorial cartoons, particularly in reference to Egypt and Libya and the ongoing popular uprisings in the Middle East. It’s interesting for me to look at cartoons as events are unfolding, particularly when the complexities of the events are overwhelming. There is the whole gamut of opinion and commentary, from the clueless to the very clever. It is also interesting to see, with events such as these, how the representations and emotions are dealt with. Quite simply, people are being killed and so humour, the stock-in-trade of political cartoons, is rarely present. Anger and outrage are much more common emotions. Or, a simplistic ‘I told you so’ (directed at people on the other end of the political spectrum, of course) is marshaled but which tends to make no sense upon closer inspection.
At any rate, I found this excellent image by Pedro X. Molina of Nicaragua of the ruthless and eccentric Colonel from Libya. For me, it really encapsulates the arrogance and even absurdity of such a brutal dictator caught up in the politics and Western domination of the region. Even though many in the West are cheering on the democratic yearnings, it would be good for us to also recognize the West’s own culpability in often propping up dictatorships in the region in order to maintain our high standard of living through the ever-increasing consumption of oil.
Let’s hope these events have a positive and peaceful outcome.
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