The Recession is sooo… 2009 (For the Upper Classes at Least)
Over the past week or so I have had a few conversations with friends and colleagues where the conversation turned to why–in the midst of a global recession and EU fiscal problems–that some companies are pulling in record profits and/or revenues. To me the answer is obvious but then, I guess, I have to remember that as someone with virtually no social life and who enjoys spending almost every spare moment reading and what not, I have the luxury of time to spend on such matters. For others (who have a social life or other family responsibilities) the seemingly conflicting signals coming out of the mainstream media about the economy would be exceedingly confusing.
When it comes to the media, we should always remember that most of these conflicting signals originate in a media echo chamber, itself filled by a mixture of mainstream and social media, which more often than not tends to latch onto good news without digging any deeper. This is why whether stocks or gold or currencies are up or down is such a major focus… it can be delivered quickly and spun in almost any way (good or bad). In an era where news is crafted into fifteen second sound bites and 140-character-or-less chunks it is easy to become convinced that being well-connected is therefore the same as being well-informed. And when those doing most of shouting in the echo chamber are nothing more than readers of government and/or corporate press-releases or are (paid to be) obsessed with the latest celebrity Facebook posts and Twitter ‘Twends’… it should not be surprising that people get confused or are sometimes completely misinformed.
A week or so ago, while listening to CBC Radio (coming out of Calgary so this shouldn’t be surprising), they held up another statistic stating that some high-end retail sector in the city is doing great and that this must be some sign that the recovery is here/gaining-momentum. This is typical of Calgary radio… economic analysis with heavy rose-coloured spin is a regular occurrence. Which brings me to the title of this post or at least the ‘the recession is sooo… 2009′ part. That was another statement made by someone on CBC radio in early 2010. Another rose-coloured, and completely misleading, statement made by a business reporter on our beloved public broadcaster. On the private broadcasters (I cannot even watch Global National anymore) it is just as bad. After Christmas, the stories centered around boutique brands and other high-end retail enjoying healthy sales over the holidays:
Porche & Lamborghini: http://www.bloomberg.com/news/2012-01-10/porsche-rolls-royce-chasing-record-sales.html
Samsung: http://www.arabianbusiness.com/samsung-posts-record-q4-profit-amid-high-end-sales-boom-438831.html
And, of course, more recently, Apple: http://www.theglobeandmail.com/globe-investor/apple-profit-doubles-thanks-largely-to-37-million-iphone-sales-in-three-months/article2313464/
And this is not a recent trend either as is evidenced by these articles from approximately a year ago:
IBM: http://www.theregister.co.uk/2011/01/18/ibm_q4_2010_numbers/
High-end Retail: http://blogs.wsj.com/marketbeat/2011/03/03/retail-sales-high-end-most-trendy-teens-doing-best/
So, what is up? Should we be like the average CBC Calgary reporter and announce that this all is just more evidence that the recession (and economic worries) are “sooo… 2009″? that European contagion is a myth? that Canada is not in a housing bubble? That everything is just the fault of lazy Greeks and PIIGS?
As I said, I do not find this surprising at all and if you have been reading entries on this blog then you will know why. To me, this makes perfect sense. Since the global meltdown in 2007 and 2008, governments and central banks have been pouring trillions into various financial sectors and bailing out corporations in sectors like banking and auto manufacturing. And this continues. It continues because the crisis never went away; rather than being a solution, the actions of governments and central banks the world over were just an attempt to kick the can down the road… and funnel more money into the financial/banking sector (which donates lots to (re)election campaigns after all). The (intended) side-effect was that all that money-printing went directly to the upper echelons of the economy. With a few exceptions, such as Lehman Brothers Holdings Inc., the upper echelon was preserved. The best example is the housing market in the U.S. As thousands of individual homeowners lost their homes, the lenders and mortgage brokers were thrown government-guaranteed lifelines. This is the real ‘wealth redistribution’ and not the kind that those on the extreme right banter about.
And this is reflected in the retail numbers. While the U.S. faces record numbers of people living under the poverty level or using food stamps (http://www.businessweek.com/news/2011-11-02/u-s-food-stamp-use-reaches-record-45-8-million-usda-says.html), high-end retail surges. The upper middle class and the elites in Western nations are doing fine (and are driving record sales in upscale, high-end, and boutique sectors). Their wealth has been preserved while the poor and the lower end of the working population are suffering and inflation is exported to less-developed parts of the world.
The dangerous thing is that for in the media echo chamber (which, let’s face it, is populated mostly by the middle and upper-middle classes) they look in the mirror and things seem fine. The mainstream media doesn’t tell anyone that the stock markets are kept afloat by a few profitable companies like Apple (http://www.zerohedge.com/news/ieconomy-demonstrating-how-apple-distorts-market), Microsoft and IBM (mostly tech and energy companies) and the illusory effects of ramped up high-frequency trading (http://www.zerohedge.com/news/presenting-rise-hft-machine-visual-confirmation-how-skynet-broke-stock-market-us-downgrade-day). And the illusion is rebroadcast and retweeted endlessly so that it appears, on the surface of televisions and smartphones everywhere, that the recession is sooo… very 2009.
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
.
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.
.
WikiLeaks and Western Economies
It has been some time since I last posted anything. I have been so busy with work and other things that I have barely looked at this blog. This does not mean that I have not been paying attention to the latest goings-on. In fact, I have been spending a lot of my spare time and any free time at work reading. And there certainly has been a lot happening in the world.
It has been interesting to see the latest official reactions to WikiLeaks, in particular the very concerted effort to distract anyone and everyone–but especially journalists (which is not very hard)–from the content of the leaks and direct their attention to ‘sex crimes,’ ‘Sex Crimes,’ ‘SEX CRIMES’ of Julian Assange. If you want to distract most journalists, all you have to do is dangle celebrities or the promise of lurid detail and simple, black-and-white stories in front of them. Few bother to look into the fact that Sweden (where the ‘sex crimes’ charges originated) has some bizarre laws pertaining to rape. Assange is allegedly being charged because the consensual sex he allegedly had with two women turned into rape because, under Swedish law, if the condom breaks and sex is not immediately halted, then the man can be charged with rape. I don’t want to minimize the charge of rape, and I certainly do not know the details of what went on, but under those strange laws, and the fact that the Swedish prosecution dropped the investigation, then re-started it and the fact that the British courts (where Assange was currently released on bail) has stipulated that Sweden pay all of the costs (widely regarded as a sign that the British court believes the charges are flawed), and the fact that the U.S. government is scouring all its laws trying to find something that could be used to charge Assange (Australia just announced Assange has broken none of its laws), then one has to conclude that something really fishy is going on.
That is all fine and good, but it led me to wonder why there is so much commotion. Most governments involved in the various WikiLeaks document dumps have stated that the information contained therein is not that revelatory or all that important. And in many ways they are right. The document dump in the summer contained a lot of raw intelligence reports (which, given their nature, cannot and should not be taken as truth in all cases) and the last installment contains a lot of diplomatic cables and such (which, again, requires analysis since these also contain the impressions, suspicions, and rants of those in the diplomatic corps). While there are certainly some embarrassing and revealing information, one would think the prudent thing to do would be to work behind the scenes diplomatically and then just ignore most of the information that comes out. They could bank on the normal levels of public apathy that has served them so well in the past. The simple fact is that most people will not take the time–especially so close to Christmas–to even try to understand what is going on… there are simply too many hockey games to watch, Happy Meals to eat, Oprah trips to scream about, game-changing iPads to buy, and gallons of Christmas cheer to pour down ones gullet. So other than the diplomatic, ruffled feathers to smooth, why bother with trying to turn Assange into a sex criminal?
Perhaps times are changing. Perhaps the powers that be are worried. There is increasing unrest, especially in Western capitals, and, despite all attempts to print more money and bailout banks (the Ireland bailout is less about bailing out the country and more about bailing out the UK, German, and US banks), Western economies are still in dire circumstances. And so, it would seem, the WikiLeaks information is adding further fuel to the fire, especially for the U.S. As a post from Global Research (and hosted by Market Oracle) states: there are “important structural consequences of the Wikileaks revelations on the United States’ international influence.” At a time when the U.S. is trying to hold itself together financially, this is potentially very damaging. If you listen to mainstream media voices, things are looking up. Journalists (or, newscasters) will quote some meaningless poll of consumer sentiment or some uncontextualized stat that seems positive as yet more proof that the recession is over. Bullshit. If you caught a stammering and clearly uncomfortable Ben Bernanke on 60 Minutes a while back, you would see a man desperately trying to offer reassurances that the most recent round of quantitative easing was necessary and would work. Right now, the only thing the U.S. has going for it is that the U.S. dollar is the world’s reserve currency. But as the rising price of gold and other precious metals indicates, as well as the fact that many countries are buying less and less U.S. debt, global confidence in the U.S. greenback is faltering. And the WikiLeaks documents–showing as they do the underbelly of global diplomacy and geopolitics–are not helping. Recall that the despot Saddam Hussein was not too long ago trying to sell Iraqi oil in Euros (which no doubt had an impact on the U.S. decision to occupy the country) and that there are rumours circulating that many nations want to replace the U.S. dollar with a basket of currencies. Perhaps then the real worry about the WikiLeaks documents is that they might further weaken confidence in the U.S. politically, which means, economically too.
Assange has stated he has a back-up plan if anything should happen to him: a series of documents so damning that he could use this as leverage against an assassination or whatever. If something happens to Assange, some mechanism will ensure these documents are made public. It is likely given what Assange has said in the past and what analysts are saying today, that these documents relate to large U.S. financial institutions. So, go figure.
The extreme reaction by some Western governments to the recent WikiLeaks document dump, and other somewhat odd happenings–Bernanke on 60 Minutes, the head of the Bank of Canada making repeated warnings to Canadians about excessive debt and other vague potentialities, etc.–make me think that something big might be potentially coming down the pipe. Perhaps the imminent implosion of a couple of major banks or financial institutions or something like that. It just seems strange that there would be such a reaction to WikiLeaks at the same time that odd signals are coming from heads of major Western financial institutions.
By the way, the image at the top was something I came across last week while reading an old war gaming magazine from 1982 called MOVES. It is an ad for another magazine that claimed to provide military and diplomatic intelligence analysis and news for the military history and wargame nerds of the era. It seems that it is OK for the ideologically aligned to have access to inside intelligence but not, even today, the general public.