Tuesday, October 29, 2013

Robot Labor vs. China. And the Co-ops?

A recent article on a solar farm in Spain, and on robots used on solar plants by a US firm reminded me of this article.  In this kind of ideological economic system, we need protectionist policies to slow down the mania and allow a scientific, and humanistic, approach support a social democratic and co-operativst economic ideology.  Well, while there are food co-ops selling organic food and buying wind power, solar co-ops in the US, and wind co-ops in Denmark, Germany, and the UK, and perhaps elsewhere, it's clear that the Corporate-Techno system will keep going full steam ahead.  Ah, the upheavals ahead will be spectacular.... 

Skilled Work, Without the Worker

By JOHN MARKOFF    Published: August 18, 2012 

DRACHTEN, the Netherlands — At the Philips Electronics factory on the coast of China, hundreds of workers use their hands and specialized tools to assemble electric shavers. That is the old way.

At a sister factory here in the Dutch  countryside, 128 robot arms do the same work with yoga-like flexibility. Video cameras guide them through feats well beyond the capability of the most dexterous human.

One robot arm endlessly forms three perfect bends in two connector wires and slips them into holes almost too small for the eye to see. The arms work so fast that they must be enclosed in glass cages to prevent the people supervising them from being injured. And they do it all without a coffee break — three shifts a day, 365 days a year.

All told, the factory here has several dozen workers per shift, about a tenth as many as the plant in the Chinese city of Zhuhai.

This is the future. A new wave of robots, far more adept than those now commonly used by automakers and other heavy manufacturers, are replacing workers around the world in both manufacturing and distribution. Factories like the one here in the Netherlands are a striking counterpoint to those used by Apple and other consumer electronics giants, which employ hundreds of thousands of low-skilled workers.

With these machines, we can make any consumer device in the world,” said Binne Visser, an electrical engineer who manages the Philips assembly line in Drachten.

Many industry executives and technology experts say Philips’s approach is gaining ground on Apple’s. Even as Foxconn, Apple’s iPhone manufacturer, continues to build new plants and hire thousands of additional workers to make smartphones, it plans to install more than a million robots within a few years to supplement its work force in China.

Foxconn has not disclosed how many workers will be displaced or when. But its chairman, Terry Gou, has publicly endorsed a growing use of robots. Speaking of his more than one million employees worldwide, he said in January, according to the official Xinhua news agency: “As human beings are also animals, to manage one million animals gives me a headache.”

The falling costs and growing sophistication of robots have touched off a renewed debate among economists and technologists over how quickly jobs will be lost. This year, Erik Brynjolfsson and Andrew McAfee, economists at the Massachusetts Institute of Technology, made the case for a rapid transformation. “The pace and scale of this encroachment into human skills is relatively recent and has profound economic implications,” they wrote in their book, “Race Against the Machine.”

Sunday, October 27, 2013

Fair Trade-Maggie's, Patagonia, HonestTea

Triple Pundit.com is too uncritical for my preferences, but they do publish some good articles from time to time to my taste.  I am happy to learn about Patagonia's extending their certifications to the social side to what appear to be the highest levels, unless they actually would go and start a full-fledged co-op supplier. Maggie's Organics did that in Nicaragua, I recall  http://maggiesorganics.com/.
There is news about HonestTea, founded by an old college friend of mine.  Although bought by Coca-cola a couple of years ago, they are increasing their sustainable ingredients independently.  Then, an interview with IKEA USA struck me as uninspiring and uncritical business news. 

Patagonia Goes Fair Trade

By | October 22nd, 2013

patagonia-fair-tradePatagonia made headlines when they admonished us: “Don’t buy that jacket.” In fact, they made so many headlines, we bought them anyway. Their commitment to environmental sustainability keeps them at the top of GoodGuide’s apparel recommendations. And they’ve even dipped their toes into social sustainability, with the Footprint Chronicles, a collective documentation of the supply chain and local impacts of all of their products. Today, Patagonia announces that it is taking its commitment to social responsibility much, much further – beyond documentation into third party verification.
In the Fall 2014 season, nine styles will be Fair Trade Certified by Fair Trade USA. This step, a first from a major retailer, represents a huge vote of confidence for the Fair Trade apparel industry in general.
“Offering Fair Trade products is an important new tool for us to help ensure fair wages and workplace safety for the workers in the supply chain who sew Patagonia clothes,” says Cara Chacon, Director of Social and Environmental Responsibility for Patagonia in a press release. “We are also empowering the people purchasing our products. This effort is part of a larger strategy to raise awareness with our customers on how they can make a difference in the world with their purchasing decisions.”
Fair Trade USA’s certification works a bit differently in the apparel industry than it does for food and agriculture. When it comes to crops like those Fair Trade bananas and chocolate you may see on co-op shelves, the focus is primarily on protecting the agricultural workers, making sure they have living wages and giving them the freedom to improve their own situation. In the case of apparel, those benefits are also extended to the factory workers who cut, make and sew the products.....

Honest Tea Increases Organic Purchases and Fair Trade Premiums

Gina-Marie Cheeseman By | October 24th, 2013 0 Comments

Honest TeaThere is so much to like about Honest Tea’s 2013 Mission Report. The company, founded in 1998, and purchased in 2011 by the Coca-Cola Company, increased organic purchases and fair trade premiums. In fact, Honest Tea increased organic ingredient purchases to 4.9 million pounds in 2012-2013, 13 percent more than the year before, and six times more than 2007.
The company is no stranger to organic ingredients. In 1999, it created the first organic ready-to-drink bottled tea, and in 2004 converted all of its tea and juice drinks to certified organic. The company contributed increased its Fair Trade premiums in 2012-2013 by 19 percent over the previous year. Honest Tea works with Fair Trade USA, and its organic products are certified by Pennsylvania Certified Organic and the USDA National Organic Program.
“Our progress in growing the demand and the supply of organic ingredients helps illustrate that our efforts to democratize organic and healthy beverages are bearing some fruit, but there is still more work to be done,” said Honest Tea co-founder TeaEO, Seth Goldman.

In addition to its organic and fair trade purchasing, Honest Tea is not afraid to take a stand on labeling genetically modified (GMO) products. It not only supports GMO labeling, but states that Honest Tea beverages “do not and have never contained GMOs.” All of its packages are labeled with a “No GMOs” logo in addition to a statement that says, “No GMOs means that if there is a bioengineered version of an ingredient, we don’t use it.” The company’s strong stance on GMO labeling might seem to create friction with its parent company, but Goldman insists that isn’t the case. In a blog post last year, he stated, “There are bound to be moments when our enterprise does not share all of the same ideas as our parent company. But there’s never been any pressure to compromise Honest Tea’s products, our ingredients, or our commitment to our mission.”....

Interview: IKEA Unveils New Sustainability Strategy

By RP Siegel | October 7th, 2013

ikea logoMike Ward, President of IKEA USA gave the keynote address at the 6th Annual Retail Industry Leaders Association (RILA) Conference in Orlando last week where he unveiled IKEA’s sustainability strategy.
I caught up with Ward a couple of days later to discuss the new strategy in greater detail.
TriplePundit: What are the main elements of IKEA’s new sustainability strategy?
Mike Ward: The new strategy really outlines for us how we want to transform the business in the next few years, using sustainability as a key platform of the business plan. People and Planet Positive is a way to explain to ourselves and to everyone what we’re going to be focusing on.
3p: So what’s different now?
MW: We’re looking at three change drivers. The first is a more sustainable life at home. We’ve always been fascinated with the way people live, and have focused our innovation on improving life, always at a low price. Sustainability adds another dimension to that challenge. Next we discussed energy independence and independence in the way that we source materials. That shows up in our commitment to renewable energy and the work we’ve done in our supply chain, particularly with respect to wood and cotton. The third aspect is a better life for the people and communities where we do business.
3p: What does sustainable life at home look like?
MW: That is where we can really add the most value. We have to be clear that even though people are becoming more aware, it’s a hard change for some people to make. But we, and all retailers, can be a big part of motivating people to make the change to a more sustainable way of living at home, because our products are so good.
3p: How do you reconcile being a provider of low-cost furnishings with bringing sustainability into people’s lives, in cases where the more sustainable options currently cost more, like organic food, for example, or cotton, or LED light bulbs?
MW: Cotton is a good example. We buy quite a bit of cotton. In fact, almost one percent of all the cotton grown in the world goes into IKEA products. The way we’re working with cotton is to really go back to the source. We work with the Better Cotton Initiative (BCI) where we have an opportunity to influence the way it is produced. This is an independent organization that works with farmers to help them figure out how to use less water, less pesticide, and less fertilizer, therefore growing cotton more sustainably.
3p: And adding your buying power helps improve the prices.
MW: Yes, it does. We’ve set a goal that by 2015, all the cotton we buy will be produced in line with the BCI standards.....

Tuesday, October 22, 2013

JP Morgan Ch Fine to Coop Banks

The recent fine of JP Morgan Chase is a little encouraging, but really just the tip of an outrageous iceberg.  In fact, business as usual continues because the Corporate Executive business model remains unchanged.  Since the Rochdale Co-op of the 1800s and Raiffeisen's credit unions a little later, Europe's Co-op Banks have gotten more than 20% market share in some areas and were less affected by the crisis.  In the US, the credit unions also fared better.  While I was a longtime Food Co-op member in NYC, I was only beginning to look into credit unions when I moved to Latin America.  There are a few projects here, and around the world, as the World Council of Credit Unions and the International Co-op Allia. indicate......  As for theories, of course, Mark Lutz gives a great account in his Economics for the Common Good, including giants like Ellerman and Daly, although J Vanek might require another source.  Ann Milford has made a recent advance in discussing Fair Trade, while J Birchall and J Rothschild have works which provide excellent historical perspectives.  Marjorie Kelly's recent work Owning Our Future accomplishes an excellent view including both social and ecological perspectives.

2) JP Morgan Chase fine by Scheer  http://www.commondreams.org/view/2013/10/22
    b) actually, the fine is only $6 billion, which indicates that it was inflated unknowingly by the media....  http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=10905&updaterx=2013-10-23+13%3A46%3A59
3) alternative indicators- http://www.emagazine.com/includes/print-article/magazine-archive/7783/
4) Interview with Jaroslav Vanek-  see 4) below 

Co-operative banks as key players

Elisa Bevilacqua - 06 June 2012

Co-operative banks have proven resilient and sustainable. Post-crisis financial regulation and reform must recognise the sector’s rich diversity

Co-operative banks form decentralised networks that are subject to both banking and co-operative legislation. They play an important role in Europe and in the global banking industry. They serve 180 million customers mainly households, SMEs and local communities and have a market share of about 20 per cent in Europe. In some European countries, like in France, Austria, the Netherlands, Germany, Finland or Italy the market share ranges between 20% and 60%. Co-operative banks employ 750,000 people and have more than 50 million members across Europe. Furthermore, 1 in 3 Small and Medium Enterprises is serviced by a co-operative bank.

These figures demonstrate the power of cooperative banking and the contemporary form of its business, which brings prosperity in both industrialised and developing countries. For co-operative banks historically created to improve access to finance for their co-operative members, who would have otherwise had limited access to financial services based on reasonable conditions, this remains a key objective.

Indeed the history of many co-operative banks can be traced back to the financial exclusion faced by many communities in the 19th century. Most co-operative banks were established following the ideas of Schulze-Delitzsch and Raiffeisen to offer opportunities to rural communities and small businesses that would have otherwise remained unserved. In economic terms co-operative banks were established to address market failures: the members were owning and financing the institutions, taking part in decision making. The community monitoring and relationships offered the necessary incentives to ensure timely repayments of loans and allowed co-operative banks to flourish and become the banks of today.

In short the co-operative banking model was an innovative answer to unequal access to financial services and the principle of mutualisation was a means to emancipating people from economic, social and even political dependency through self-reliance and solidarity. While evolution of the structures and national legislative frameworks and traditions have differed in the different EU countries, this basic set of values and characteristics still holds true.

In particular the key distinguishing factor of member ownership is a common and defining feature. The local banks are effectively owned and controlled by the local customers through membership. The local banks in turn own and control the supporting infrastructures, regardless the number of tiers, roles and authorities delegated to them.

As co-operative banks networks are established at local level, they are fully integrated in their immediate environments. This feature of proximity means that the credits collected are reinvested at the local and regional level and as a result the co-operative banks play a key role in development of areas in which they are based. In other words the decisions in co-operative banks are taken at local level and granted to local projects from the member/owners. “This reflects the primary banks’ awareness of their social and economic responsibility in their respective local communities and it is in line with the co-operative principle: from the local community and for the local community.”1 In this respect co-operative banks have continuously promoted entrepreneurship through fostering self-help, responsibility, co-operation and solidarity while emphasising the common good of the communities they belong to.

Proximity: improving access to financial services and fostering regional development

With 65, 000 branches in the EU-27, co-operative banks provide EU-wide coverage, from the inner cities up to the most remote areas and villages. They provide access to finance for customers in regions that would typically not be served by other players of the credit sector due to decisions based on the profitability criteria alone.

The market share of co-operative banks in rural areas ranges from approximately 41% in Germany to up to 85% in France (3 co-operative banks groups combined). In most European countries, including France, Portugal, Italy, Spain, UK, Austria, the Netherlands, Greece, France and Finland, co-operative banks are often the only financial institutions present in areas that are considered remote.

The inclusive role of co-operative banks has been illustrated in literature, a study of 2005 examines the consequence of historical presence of local co-operative banks on long-term growth (data from 1970 to 1993) and finds that the size of the total financial sector has little impact on regional growth, while the presence of co-operative banks is crucial.2 The authors argue that the less complex and smaller co-operative banks, with high knowledge of the local community are more suitable for providing funding for locally based businesses, than large financial institutions owned by a vast number of shareholders. On account of their proximity to the members and their local establishment, co-operative banks are well placed to gather more comprehensive information that allows for better evaluation of the needs of customers and their solvency. For example, processing soft information on borrowers, reducing information asymmetries and lowering moral hazard and adverse selection.

Recent research conducted by the CEPS (Center for European Co-operative Studies) in 2010 across 7 EU countries has demonstrated the contributions of co-operative banks in fostering local growth.3 The research confirmed that the regional presence of co-operative banks has a positive impact on regional growth and GDP. Moreover in some countries like Austria and the Netherlands co-operative banks appeared to play a stabilising role through maintaining their presence in regions that experience slow growth and therefore contributing to future economic recovery.

Resilience: contributing to the stability of the financial systems

The member-customers are fully involved in the decision-making process of co-operative banks. Apart from allowing for risk minimisation, creditworthiness and customer need identification, member control is key to a long-term vision. Unlike other companies quoted on the stock exchange, co-operative banks are not subject to the volatility of financial markets. Their primary aim is the long-term relationship with customers/members and members value maximisation. The continuous increase of profits is not a goal per se. Thanks to this long-term approach ─ high level of capitalisation, stable incomes from retail business, a diversified credit portfolio and prudent risk management ─ co-operative banks demonstrated their resilience during the recent financial crisis and weathered the storm relatively well. The stabilising role of co-operative banks was illustrated in a recent study of the IMF and acknowledged by several commentators and policymakers, including EU and International institutions. They underlined the continuous support of co-operatives to local economy and small businesses also during the turmoil.

Towards an enabling regulatory environment

Thanks to their co-operative features and structure, co-operative banks are resilient and sustainable; they are an asset for stability and for providing accessible and inclusive financial services. As recently declared by the Secretary General for the United Nations, Mr Ban Ki Moon: “Cooperatives are a reminder to the international community that it is possible to pursue both economic viability and social responsibility.” However an enabling regulatory framework that fully takes into account the diversity of banking models in Europe is fundamental to be able to continue playing their crucial role.

One of the lessons drawn from the sub-prime mortgage and financial crises is the importance of diversity in the banking industry. Although still difficult to apply in practice, several commentators, public authorities and international organisations have fully acknowledged that "just as an ecosystem benefits from diversity, so the world is better off with a multitude of corporate forms."

Several researchers at European level (Lwellyn, Ayadi, Ferri, Kalmi et al.) have recently stated the powerful systemic benefits to be derived from diversity of business models and ownership structures in the banking sector. In short a pluralistic approach is likely to ensure greater financial stability and growth, as it responds to different objectives and business purposes.

Despite these recognitions, the recent banking reforms and the post-crisis financial regulation show that legislation at international and European levels is conceived on the basis of the mainstream shareholders banks model (with high level of sophistication) and does not take properly into account the diversity and characteristics of the other models. If diversity has to be translated into practice, a cautious approach must be taken by the legislator to avoid a detrimental one-size fits all approach that might hamper growth and local communities.

Elisa Bevilacqua is head of research and communications at the European Association of Co-operative banks

1 Androniki Katarachia, “Social responsibility and customer satisfaction in cooperative banking”, 2nd International CIRIEC research conference (2009)
2 Usai, S and Vannini M., “Banking structure and regional economic growth: lessons from Italy”, Annals of Regional
Science (2005)
3 Ayadi R., Llewellyn D., Schmidt R. et alt, “Investigating Diversity in the Banking Sector in Europe, Key developments, performance and role of cooperative banks”, CEPS (2010)


4) Vol 5 No 1 1995
Cooperative Economics: An Interview with Jaroslav Vanek

interviewed by Albert Perkins

Albert Perkins: Professor Vanek, how did you first develop your ideas on economy?

Jaroslav Vanek:I had four major influences. First, I experienced the evils of communism when I was a refugee in Czechoslovakia from Stalinism, and later, when I came to the West, I also experienced the evils of western capitalism. Then, in between, I was fortunate enough to spend time with my late brother who did extensive work for the I.L.O. (International Labor Organisation) and wrote the first book about the workers' councils in Yugoslavia. I learned many of my basic ideas from him. He was a sociologist and I was an economist, and I was able to transpose his ideas into my field. Third was the doctrine of the Catholic Church. Pope John 23rd went a long way toward suggesting the desirability of economic democracy. Finally, I was influenced by Dubceck's model of social democracy. It could have been more successful than the Yugoslavian experiment, but for the Soviet tanks. I have had several interests in my life, including the area I call economic democracy. Economic democracy is a transposition of the idea of political democracy. It implies that economic life is governed by people who are involved in thateconomic life. Capitalism is based on property rights, and democracy on personal rights. Perhaps the most important aspect of capitalism, its objective function, is to maximise profit. If you look at it more carefully, profit is revenue minus labor costs and other costs. This means then human beings enter the defining objective function of the system with a negative sign. By contrast, economic democracy has an objective function where people are on the positive side of the equation. The idea is to maximise the welfare of the people participating. This is an enormous difference, and I'm convinced that the tragic difficulties of our culture -- ecological devastation, starvation, etc. -- can be traced to this negative side But capitalism could be cured slowly if we developed economic democracy. One of the main reasons why the western world is so schizophrenic is that we have political democracy and economic autocracy.


Sunday, October 20, 2013

From Nobel Economics to Local Activism


Nobel Prize? Meet the Economic Movement That Really Deserves Praise

This week, the Nobel Prize for economics may have gone to three academics, but the real work of fixing our local economies was happening on the ground—as part of New Economy Week.

The winners of the so-called Nobel Prize for economics were announced this week, and what a peculiar pick: The three who will share the award this year sit on two diametrically opposed sides of their field’s most critical debate.
Photo by D. Bjorn.Are markets magic, efficient, rational, and in need of no regulation? Or are they irrational, hysterical, and error-prone, like the humans who bet on them? That’s the debate.
Splitting the prize between Eugene Fama and Lars Peter Hansen (two "magical markets" guys) and Robert Shiller (whose 1992 book, Market Volatility, was all about exactly that) is kind of like splitting the biology prize between Charles Darwin and the Tea Party Creationist Caucus. It makes no sense.
But the prize isn't even a real Nobel. The Nobels were around for 67 years before the prize for economics was created. The economics prize was invented, in fact, by Sweden's central bank in 1968 in a strategic attempt to bestow on the field of economics the same scientific aura and respect accorded to medicine and mathematics and physics. The Swedish bankers leaned heavily toward the magic of the markets idea: Persuade people that money matters are scientific and complicated and best left to them, and you tend to get government off your bank.
But here's the good news: The same week that the pseudo-Nobels were announced, we saw a nationwide celebration of regular people diving into economics. This week was New Economy Week.
"People are realizing, from a very high theoretical level to the level of the street, what is being offered to them is insufficient."Day after day, people all around the country have been showing off their best ideas about stabilizing local businesses and building local democracy. They're considering what they can do to divest from big banks and fossil fuel, and they’ve marked all their activities on a big online map.
New Economy Week is a project of the New Economy Institute and the New Economy Coalition, a group that, after only a few months, already has 51 members. The organizers' goal was to map 40 events in one week. Halfway through, their map was peppered with 75 events in 17 states and two Canadian provinces.
"People are realizing, from a very high theoretical level to the level of the street, [that] what is being offered to them is insufficient," Bob Massie, President and CEO of the Institute, told me. "The system's broken."
“New Economy groups are emerging all around the country in response to local conditions: transition towns, sustainable business networks, the cooperative movement, local first,” added Mike Sandmel, New Economy Week coordinator. “They tend to live in silos. Our goal was to lift up the bigger picture.”
In downtown Manhattan, people packed into a community media center in an old brick firehouse to watch David Brancaccio's Fixing the Future and other films in the first-ever New Economy Film Festival.
The online publication Shareable held a “sharing cities map jam,” the kickoff action of a new Sharing Cities Network. Shareable wants local people to collaborate to map all the sharing-inclined businesses and projects in their cities.
“We believe that making these oases of sharing visible will be an empowering first step for the network,“ wrote Shareable's Mira Luna.
What does all this national mapping mean for strong local economies?
“We talk about trans-localism” says Sandmel. "We don’t believe in doing things on a bigger scale than you need to, but we do live in an increasingly horizontal world and the new economy movement has a good chance of having an influence if it comes together.”
Coming together, talking about sharing, and meddling in money and market matters... Is it mad? Not madder than this year's economics prize. And if the pseudo-Nobels weren’t proof enough that something's wrong with leaving private interests to run public affairs, there’s always Washington.
What’s more crazy: setting up a local tools library in the name of helping struggling families, or, I dunno, closing down the government?
Find out more about New Economy Week here.

Laura Flanders wrote this article for YES! Magazine's Commonomics project. Laura is YES! Magazine's 2013 Local Economies Reporting Fellow.


Sunday, October 13, 2013

From Niall Ferguson and Keynes to Empire

The conventional economist Niall Ferguson was the start of an article and series of commentaries that make a nice review of the state of the world.  My post follows theirs below.
Published on Friday, October 11, 2013 by Beat the Press / CEPR

The Ravings of Niall Ferguson, the Real World, and the Needless Suffering of Tens of Millions

by Dean Baker

For reasons I cannot imagine, Niall Ferguson has achieved some standing as an intellectual with interesting things to say about the economy. Whenever I have read one of his pieces I almost always find it so confused that it would take a blogpost at least as long as the original to set it straight. This is why I generally ignore Ferguson, except when prodded by friends and readers.Niall Ferguson. (Photo: The Aspen Institute)For this reason I was struck to see that my occasional Niall Ferguson corrections got me on the list of Paul Krugman’s

“like-minded bloggers who play a sinister game of tag with him, endorsing his attacks and adding vitriol of their own. I would like to name and shame in this context Dean Baker, Josh Barro, Brad DeLong, Matthew O'Brien, Noah Smith, Matthew Yglesias and Justin Wolfers.”


In addition to all the people who are unemployed or underemployed, the weakness of the labor market has made it impossible for most workers to be able to achieve real wage gains. As a result the benefits of the growth we have seen in the United States and other wealthy countries have gone overwhelmingly to the richest 1 percent of the population.
This story is not only devastating for the current generation of workers; it is also having a devastating impact on their children. There are millions of children having impaired childhoods because their unemployed parent(s) cannot properly care for them. (Bizarrely, Ferguson and his ilk are obsessed with deficit projections for 20 and 30 years out, which are entirely due to our broken health care system, as the worst threat facing our children.)
The horrible plight facing so many people in the United States and Europe is especially infuriating because it is so preventable. We know how to get people back to work – Keynes taught us the answer almost 80 years ago. We just need to spend money. Keynes was shown right in the Great Depression and all the evidence that we have seen to date in the current downturn show that these lessons still hold. (Btw, we can also go the route of reducing work hours, while making up for most of the shortfall in wages. Reductions in work hours is the secret to Germany’s 5.4 percent unemployment.)



  • Avatar
    2 days ago•555
    Krugman and Baker are both wrong.
    The primary economic problem is the ongoing unchecked corporate crime wave.
    Until the banksters are imprisoned, the rule of law established and their victims made whole there will be no economic recovery.
    Krugman and Baker skip mentioning this primary step because their allegiance is to the Democratic party where many of the perps hide out.
    After an economic foundation has been reestablished then you can move ahead with Keynesian stimulus, not before.
    Pouring stimulus into a broken, rigged and criminal economic system will produce little or no benefits for the working class.
    Do we need further proof of this fact?
    The Fed has pumped $16 trillion into the banking system and the bottom 90% have not benefitted at all.

    • CygnusX1isaHole, you are certainly correct that while both Krugman and Baker are only part right in conventional economic terms, they are "both wrong" (dead wrong) in terms of any serious economic analysis that considers the "broken, rigged, and criminal economic system" being gamed by the 'economics of EMPIRE' --- which is, after all what we are caught in.
      Therefore, you are absolutely right in noting that "The primary economic problem is the ongoing unchecked corporate crime wave" --- to which I would only add and extend your analysis by noting that the 'corporate crime wave' is CAUSED by a very guilefully Disguised Global EMPIRE:
      Currently the singular factor driving the Global Empire to establish more overt control over the masses is
      that the Empire Economy is collapsing because it is choking on an overflow of “Negative Externality Costs” which can no longer be hidden from the masses.
      The external costs of production are dramatically rising (the costs that the corporations impose on the environment and third parties)
      But in fact, 'externality cost dumping", which
      IS the seminal problem, is not only broadly used/abused by the 'corporate sector' of the Empire in "production", but universally used in the 'financial sector' of the Empire --- ie. on Wall Street, which is correctly tagged as the "most corrupt system in world history" because it has recently perfected the
      new alchemy of turning not lead, but paper (CDO's, CDS's, and all derivative 'contracts') into gold to plunder wealth.
      It is essential to understand (and properly diagnose) both 'externality cost dumping' and its twin, EMPIRE --- because 'externality cost dumping' is the central concept of Empire itself.
      Empire always historically, by definition, plunders wealth from outside its boarders, and dumps
      'negative externality costs' (including enslaving and/or killing 'subjects', stealing resources, land, treasure, et al) from outside the boarders of the EMPIRE.
      But in today's 21st century post-nation-state globalized world THERE IS NO 'OUTSIDE'.
      Dumping negative externality costs on a global level by a Global Empire has no meaning ---- since the effects of dumping classic 'production-type' negative externality costs (like air, water, land pollution, not to mention causing a death-spiral of climate change)
      causes harm to all those who are treated as the 'others' or 'subjects' of the Global Empire.
      Likewise the deceitful and deadly wrong corporate empire's "phony economists" have been using and continue to use a model of economics which pretends
      that the now massive factor of 'negative externality costs' can be removed from the equations of the predatory and faux-profit driven corporate, financial, militarist, media, (IL)legal, and political Disguised Global Empire (DGE) which has 'captured' and now fully "Occupies" our former country as its nominal HQ (but which also includes; UK, France, Germany, NATO, WTO, IMF, EU, Israel et
      Best luck and love to the fast expanding 'Occupy the Empire' educational and non-violent revolutionary movement against this deceitful and Disguised Global EMPIRE, which can't so easily be identified as wearing Red Coats, Red Stars, nor funny looking Nazi
      helmets ---- quite yet!
      Liberty, democracy, justice, and equality
      Violent ('Vichy' disguised dual-party)
      Alan MacDonald
      We don't merely have a gun/fear problem, or an MIC problem, or an 'Austerity' problem, or an expanding wars problem, or a 'drone assassinations' problem, or a vast income & wealth inequality problem, or a Wall Street 'looting' problem, or a Global Warming and
      environmental death-spiral problem, or a domestic tyranny NSA, NDAA, and FISA spying problem, or the world's largest political prisoner problem, or, or, or .... ad nauseam --- we have a hidden EMPIRE cancerous tumor which is the prime CAUSE of all these underlying related 'symptom problems'

      • Kudos to both A McD and CxH for their edifying comments. I will add the observation that, as any student of history, knows countries, like organisms have lifespans and those countries that rise to become powerful hegemonic empires pay a terrible price in terms of distortion of their societies. The U.S. (while certainly never the paragon of virtue that its sycophantic boosters would like to portray it as being), was a great society that produced a rich heritage of art, science, technological advancement, a decent life for the biggest share of its citizens of any contemporary state, among other postive attributes. Of course these were achieved while plundering the resources of the continent, poisoning every stream and lake, stripping off the forests, killing off (inadvertantly at first and soon after intentionally) the native population and consigning the remnants to small "reservations"; and in more recent years running a now nearly 70 year war on the countries of the "third world", complete with death squads, assasinations, governmental overthrows, client dictators, disinformation campaigns and so on.
        In the end though all empires fail. A small elite part of the "mother" country's society reaps all the rewards while the costs (the externality in this particular case) are laid on the victims in the target areas and the general populace at home. Paul Kennedy examined this type of development in his book "The Rise and Fall of the Great Powers" nearly 25 years ago. Also the change in the structure of hegemonic societies from productive capital regimes to finance capital regimes was examined by Immanuel Wallerstein, and Fernand Braudel even more years ago. Unable to compete successfully with domestic production in world markets U.S. capitalists invested in the countries that would supplant them and later turned almost exclusively to running various types of swindles and other financial shennanigans.
        On top of everything else the world has already exceeded its carrying capacity with 7+ billion people and in many ways, not just global warming, we are ruining the planet we live on. And to make things worse U.N. population trend predictions have now turned back up from a peak of 9 billion to 11 billion or more. It is hard to believe we will ever achieve that high of a population with the stupid, short sighted, exploitive way our elites run their business interests; the planet simply will not support such abuse and sustain us with a productive environment.
        It does not add up to a very pretty picture. The only serious future is to begin immediately reducing population and through education and confiscation of the holdings of the rich build a fairer and more humane society. Our scientific and technological tools are superb and getting better rapidly, but many of our social interactions are still in a stone-age level of awareness. That sufficed when we were few and had a minimal impact on the Earth, that is not the case now however.
      • http://www.commondreams.org/view/2013/10/11-0
    • Mark RegoM
      3 minutes ago•00
      Nice job CygnusX1, Alan MacDonald, and dmorista. The empire itself can be identified beyond nationalities in terms of corporate governance. The US is a great nest of them, the "profit-maximizers" who do so much externalizing of costs. When conservatives established the Heritage Foundation in the 1970s, they began their own "Great Leap Forward" to use the Maoist term. Milton Friedman was their AdamSmithian guru then. Reagan's election then accelerated their ascendance. While Milken, Enron, and Lehman Brothers involved some who took a fall, of course, the existing Big Corp's and their Executives achieved such evil High Points as the elimination of Glass-Steagal Act and the Citizens United decision. The solutions, then, can be best found in local initiatives and broad networking, since Hugo Chavez's kind of incredible national politicking is rare. Chavez established social priorities and development especially through initiative oriented Co-operative Enterprises. The Co-op Enterprise model is one of the foundations behind such successes as the Mondragon co-op complex, and the Solidarity Economy movement framed along with the World Social Forum movements.
      Similar bearers of hope are the certification movements which are trying to leverage consumer values against Corporations per se. I'd say Food Co-ops in the US, European co-ops that nurtured the growth of wind power beginning in Denmark, and the very origins of the co-op movement in the UK, Germany, Denmark, and elsewhere all make a strong basis for something beyond the Occupy Movements. Good luck, God Bless, and see you there.
      see more

Tuesday, October 1, 2013

Consumerism, Milgram, and Obedience

Someone shared this piece about Obedience recently.  As a youngin' I was exposed to psychological thought through my Dad's library.  Peter Gabriel's song Milgram's 37 contributed as I studied bio anthro in college.  I had read Media Sexploitation by BW Key in high school, and in recent years read William Parrish's Anxious Decades about the 1920s.  The depth of consumer conditioned thought is a basic reality that can be addressed.  I started going camping in college, and think that activity can help stimulate alternative thinking.   Gandhi's activism in which he used a spinning jenny to prepare and make his own cloth is another.

In contemporary society, the most powerful authorities are the interlocking boards of directors of major business corporations and the state apparatuses that support them. As in the Milgram paradigm, the demands made by these authorities on today's consumers and citizens are leading to increasingly grave consequences for human life, including dangers that were not foreseen when Corporate America first launched the mass consumerist experiment in the years following World War I.

How is obedience maintained in consumer society? What sorts of escalating consequences can we expect if it continues?

While large corporations sometimes give direct orders to consumers, more often they exact obedience in indirect ways by suggesting images, ideas and social narratives, and by manipulating emotions so that desired behaviors become more likely. This is what we call marketing and advertising, and it works extremely well.

In recent years, a growing body of psychology research, including important work by Tim Kasser at Knox College, has revealed associations between corporate propagation of materialist attitudes (i.e., having a strong value orientation toward money and possessions) and poorer life satisfaction, higher levels of anxiety and depression, poorer quality of interpersonal relationships and lower self-esteem.

According to other researchers, such as Susan Linn at Harvard University, the consequences of prioritizing the consumerist mindset are even more debilitating for children than they are for adults, especially for young children who have not yet developed the capacity for critical thinking. Direct corporate messaging to children, a relatively new and highly sophisticated phenomenon, is a pretty easy way to boost sales, but it also has predictably negative effects on kids' social, psychological and physical health. For example, most marketing to children is for junk food, a significant risk factor for obesity. According to the New England Journal of Medicine, obesity-related disease is predicted to shorten kids' life spans to such a degree that the current generation will probably die younger than their parents for the first time in the modern era.

As mass consumerism was being promoted in the early 20th century and the modern advertising industry was developing, the full matrix of hazards were unknown. The "shocks" caused by obedient behavior were limited and minimal - the equivalent of a slight tickle. This is no longer the case. As circumstances have changed with time, the consequences of obedience to the corporate imperative have become much more dangerous.

In spite of overwhelming evidence that the habitability of our ecosystem is threatened due to rampant hydrocarbon exploitation, natural resource depletion and unrelenting pollution, we are surrounded by incessant appeals from dominant institutions to pull levers of consumption to keep ourselves and our society flourishing.

Overconsumption is a function of obedience built on the false premise that eternally acquiring more goods will make you, your family and your society happier. These goods are produced in a way that - we now know - is likely to lead to global environmental catastrophe. While many authorities acknowledge climate realities, they also claim that the extraction of fossil fuels continues to be necessary for powering a high-tech, industrial economy.

Is there really no alternative to digging up and burning all the oil, gas and coal that industry can find? Safe energy alternatives to fossil fuels are, in fact, already technologically feasible, but they do not maximize profits and therefore are not offered as a serious replacement. Full transformation to a green energy economy is a realistic option that would come with many permanent jobs, but this is not a choice offered by fossil fuel corporations and the state that subsidizes them to the tune of billions of dollars a year. At the end of the day, an "all of the above" energy policy like that of the Obama administration cannot hold back irreversible climate change....