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Ch. 2: The Cup Runneth Over

#140: Aug. - Oct. 2015 (Non-Fiction)
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DWill

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Re: Ch. 2: The Cup Runneth Over

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Robert Tulip wrote: What I find totally fascinating about the collapse of communism is how we are now seeing a recrudescence of an emotional hankering for the communitarian model with the rise of what I like to call “neo-communism”. This is the fantasy mentality that sees neo-liberalism as an evil cabal. Neo-communism uses social media as an echo chamber to construct a vision of politics and economics in conflict with all sensible governments (Zakaria mentions Peru, Brazil, Turkey and others). There is something emotionally satisfying about implicit ideas of class warfare, that the masses will arise and cast off the chains of oppression. Unfortunately this romantic model of politics fails the basics of economics and human motivation, simply placing a different and worse elite in power, since without market discipline you have corruption. But popular myths are characterised by a perverse ability to avoid allowing facts to get in the way of an enticing story.

The really disturbing thing in Australia is that this attitude of hostility to capital and investment, an attitude whose only result can be a one way ticket to Greece, is actually leading in the polls, because Australia has a state owned broadcaster which has been captured by a leftist staff collective who are adamantly hostile to economic reality. This example of Australia’s State Broadcaster illustrates how state power is dangerous and needs to be limited. I hope we can sell off our sheltered workshop state broadcaster. Privatising communications would enforce market discipline and remove the power of ideas that are not backed by responsibility.

The centre of gravity (or maybe I should write center of gravity) in US politics is well to the right of the situation in Australia. A friend of mine recently commented that Australia has a nanny state. Zakaria mentions how this cossetted attitude was rebutted by Margaret Thatcher with her famous slogan “There Is No Alternative”. Unfortunately, we are seeing that there is an alternative to progress and growth, and it its regress and stagnation. The amazing thing is that regressive thinkers like the new Pope of Rome have the brazen impudence to assert that their sentimental obsolete nonsense is good for the poor. I suppose this broad cultural recrudescence of neo-communism is in line with Hitler’s theory that if you tell a big enough lie then people will believe it. Pope Francis is welcome to his dream of all living in poverty, but it is hardly one that he can expect others to share. The danger is that such mentality can gain power, bringing risks of stagnation and conflict. The world cannot afford that.
Of course, you are exaggerating about a hankering for communism, Robert, emanating either from populist movements or from the Vatican. Communitarian values don't equate to ideological communism. There may be Romanticism in the views of some levelers who seek less stratified societies, but when this vision is successfully put in place in some capitalist countries in Europe, you have to recognize that less inequality is more than a dream and that it can also be consistent with general affluence.

The Church has always railed against materialism, even as it hypocritically amassed enormous wealth. No doubt as well the current pope sees his views on materialism and the environment--calling for action on GW--as going hand in hand. You yourself believe that economic growth poses no insuperable problem to the environment, but many reasonable people disagree.
Zakaria comments that “there is a growing gap between America’s worldly business elite and cosmopolitan class, on the one hand, and the majority of the American people, on the other.” This situation, identified by Occupy Wall Street as the syndrome of the 1%, illustrates Zakaria’s point about the hollowing out of the American middle class. The frightening reality is that people in India and China are willing to do manufacturing and services jobs for much lower pay than Americans have done them. The upheaval through the creative destruction inherent in the capitalist market system is producing dislocation, envy and tension, but imagining it can be stopped is like trying to stop the tide by the king’s command.
I thought FZ was not referring specifically to the income gap of the 1 per cent vs. the 99, but to the large segment not prepared to engage the world that is coming into existence vs. the the small part that knows it's better to emerge from the cocoon that has encased us for as long as we can remember (which in historical perspective is really not a long time). But these two sets do overlap. I think the 1 vs. 99 is a crude way of addressing our problems; it is unfortunately too much based in class envy.
There is no way that things could be made better by policies to prevent free trade. That seems counterintuitive to some who want to protect jobs, but the reality is that if a job needs protection by the state then it is on a path to extinction. Economies have to be robust and innovative, and the dead hand of state protection produces a cossetted and uncompetitive shell that soon becomes ripe for destruction when the subsidies can no longer be afforded. I fear this is a lesson for America’s bloated military.

In any case, allowing jobs to be done by those who are willing to do them for the lowest price is a clear moral requirement of social justice. It is ethically unfair and unprincipled to give work to an uncompetitive firm just because they are your friends, when this means condemning someone in another country to the dire poverty of subsistence agriculture. By opening the economy to competition, innovation is given the opportunity to thrive. We are now seeing amazing firms like Tesla and Google create whole new areas of work in a competitive market. It is exciting to see the buzz around books like Bold by Peter Diamantis. These new models of abundant wealth creation through high technology are very much based on a controversial American saying, get out of my way.
I don't know, Robert, "get out of the way" may have helped us achieve, here in the U.S. cities such as Detroit and St. Louis that we have decided to give up on, hulking wrecks symbolizing our social failures. There has to be some socialism, in my view; that is, government acting to preserve and direct to a degree. Whether that is always efficient may not be the most important thing. France makes huge efforts to support its agricultural industries (including, of course, wine). Do we want this kind of heritage to be swept away through creative destruction?
I don't disagree about the futility of government picking economic winners and losers, though.
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Re: Ch. 2: The Cup Runneth Over

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DWill wrote:you are exaggerating about a hankering for communism, Robert, emanating either from populist movements or from the Vatican. Communitarian values don't equate to ideological communism.
My use of the term “neo-communism” is a way to explore how in the post 1989 world there is a basic context of market economics and liberal trade as the governing paradigm for politics, but nonetheless a view of the role of the state that owes much to socialist thinking. This is less the case in the USA than elsewhere, although even the current American politics around political correctness do have some level of connection, even if indirect, to Lenin’s ideas about capitalism as the highest stage of imperialism or vice versa whatever.

I am not suggesting that anyone except people in the mould of Chavez and Castro are actually communist, but rather that exploring the evolution of ideas helps to situate the current reaction against the post 89 unipolar moment which Zakaria explains culminated in the overreach of the Iraq War.

In using the phrase “neo-communism” I am thinking especially of the ideas of the founder of the Italian Communist Party Antonio Gramsci, who was imprisoned by Mussolini and wrote his book The Modern Prince as a commentary on Machiavelli. Gramsci understood the Communist Party as his ideal of the metaphor of the prince, but recognised that in Europe there was little prospect of a dictatorship of the proletariat on the Leninist model, and therefore coined the phrase “the long march through the institutions”. This idea picked up on the romance of the Chinese Communist Party with its long march to escape destruction at the hands of the Chinese fascists.

The eurocommunist Long March Through the Institutions has inspired teachers within the public school system to see how they can change the values of society towards a communist critique of capital. There is a strongly surreptitious dimension in the Gramsci model of advancing the social power and influence of the left, recognising that traditional values are deeply hostile to left wing theories of equality, but seeking like the Jesuits to take the child of seven to create the adult.

I have not seen anyone else use this term “neo-communism”. As I say, I have coined it to explore how some communist traditions have adapted to a unipolar framework where as Zakaria points out the Soviet Union and Communist China no longer exist as a viable alternative model, and yet their ethical drivers around class analysis are still seen as relevant.
DWill wrote: less inequality is more than a dream and that it can also be consistent with general affluence.
Capitalism is founded on the principle of equality of opportunity. As Hayek argues in The Constitution of Liberty, the British theme of rule of law is entirely about saying that the strong institutions of the state provide doctrines of justice which should apply equally to all, and that no person is above the law. Of course this theory does not really work in practice, since money is power, and US politics is especially corrupted by donations that turn your politicians into weak patsies, jumping to the whip cracked by capital.

What I think books such as Zakaria open up is how key capitalist principles such as equality of opportunity can be better explained to the broader society, without immediately collapsing into the opposing corruption of a demand for equality of outcomes. It is entirely the principle of equality that demands the right to trade, and that shows that protection of jobs in one part of the world violates equality when people would prefer to buy from someone who is more productive and efficient and are prevented from doing so by national laws mandating inequality.
DWill wrote:
the current pope sees his views on materialism and the environment--calling for action on GW--as going hand in hand. You yourself believe that economic growth poses no insuperable problem to the environment, but many reasonable people disagree.
Zakaria has a good discussion of climate change in this chapter, which it would be useful to analyse. What I am interested in is how the methods of the right can deliver the goals of the left regarding global warming. Market systems are needed to mine carbon from the air.

This romantic popish idea that if we just make everyone poor we will fix the climate is the height of religious stupidity. If we focus on innovative disruption through research and development of new technology then growth and biodiversity can be compatible. It is the popish path of poverty that presents the real threat to the environment.
DWill wrote: FZ was not referring specifically to the income gap of the 1 per cent vs. the 99, but to the large segment not prepared to engage the world that is coming into existence vs. the small part that knows it's better to emerge from the cocoon that has encased us for as long as we can remember (which in historical perspective is really not a long time). But these two sets do overlap. I think the 1 vs. 99 is a crude way of addressing our problems; it is unfortunately too much based in class envy.
So the butterfly prophets, to continue your cocoon analogy, overlap with the innovators of capitalism, such as in Silicon Valley. The question here is about visualising a new paradigm. There is not much point being able to float like a butterfly if you can’t sting like a bee. A lot of new paradigm thinking is as vague and ephemeral as a butterfly sipping flower nectar in the sun, where what is needed is a hive of beecraft, a systematic world of industry and investment and cooperation to address the coming storms.
DWill wrote:
"get out of the way" may have helped us achieve, here in the U.S. cities such as Detroit and St. Louis that we have decided to give up on, hulking wrecks symbolizing our social failures. There has to be some socialism, in my view; that is, government acting to preserve and direct to a degree. Whether that is always efficient may not be the most important thing. France makes huge efforts to support its agricultural industries (including, of course, wine). Do we want this kind of heritage to be swept away through creative destruction?
I don't disagree about the futility of government picking economic winners and losers, though.
“Get out of the way” is the hero inventor John Galt’s motto in Ayn Rand’s objectivist book Atlas Shrugged. Rand was of course a big influence on Ronald Reagan, and continues to influence at least one of your prominent Republican Presidential hopefuls.

Recognising that laissez faire does not work is not in my view about talking of socialism, but is better addressed through Hayek’s focus on the rule of law. Public funds are better directed to innovators in the new economy than to trying to keep obsolete industrial models alive.

Sustaining American standards is all about a shift to a new services focus through a relentless focus on skills and innovation. Turn on a dime or see more Kodaks.

It should always be possible for good public policies to be justified by evidence. In the case of French subsidies to agriculture, it is possible to quantify a range of benefits including tourism, as well as the more intangible benefits of cultural heritage which you mention. Even so, France is highly sclerotic, with serious problems of unsustainable debt.

But I don’t believe that America’s brazen impudence in maintaining that corn subsidies help stop global warming fit into any category of evidence, except evidence of corruption. Oh, and evidence for how high fructose corn syrup is about as good for your health as nicotine.
Last edited by Robert Tulip on Sat Aug 29, 2015 6:23 am, edited 1 time in total.
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Re: Ch. 2: The Cup Runneth Over

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With only time for a quick response, I seize on your last statement about HFCS. There really is no science behind the demonization of this one sweetener. Replace it all with cane sugar and Americans would be just as fat. "HFCS-free" is just another opportunity for marketers.
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Re: Ch. 2: The Cup Runneth Over

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DWill wrote:With only time for a quick response, I seize on your last statement about HFCS. There really is no science behind the demonization of this one sweetener. Replace it all with cane sugar and Americans would be just as fat. "HFCS-free" is just another opportunity for marketers.
Hi DWill, your comment "there really is no science" is a good example of careless language. You would have been more accurate to say "I am not aware of any science". Check this 2010 study from Princeton University which found that rats eating high-fructose corn syrup gained a lot more weight than those given table sugar, even when their overall caloric intake was the same. HFCS consumption led to abnormal increases in body fat, especially in the abdomen, and a rise in blood fat triglycerides. HFCS turned these Princeton rats obese just like chemical corn soda does to US people, a health crisis perpetuated by the corrupt system of campaign donations.

http://www.princeton.edu/main/news/arch ... /91/22K07/
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Re: Ch. 2: The Cup Runneth Over

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Okay, maybe "no science" implies that no studies have indicated possible harm, which wouldn't be true. But I stand by my statement that HFCS is merely the scapegoat du jour for habits that are responsible for people becoming fatties. It just stands to reason, Robert, that it makes little difference where we get the sugar if we're putting too much of it in foods--and marketing these foods aggressively. It's the cheapness of HFCS (cheap at least the way we figure these things ) that has propelled it to the forefront.

A major study that did show harm from HFCS in people was invalidated. http://www.eatingwell.com/nutrition_hea ... rup?page=2

I'll go along with the Mayo Clinic for now. http://www.mayoclinic.org/healthy-lifes ... q-20058201
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Re: Ch. 2: The Cup Runneth Over

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Robert wrote:Capitalism is founded on the principle of equality of opportunity.
I agree to an extent, but this should be clarified. Capitalism works best with equality of opportunity as one of the founding principles. But it isn't a necessary founding principle. When left unchecked, Capitalism strays away from equality of opportunity. The primary concern of a capitalist society is production and profit, which means other concerns are secondary, including fostering equality. Of course many good things align with increased production and profit, but it's also true that many things don't.
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Re: Ch. 2: The Cup Runneth Over

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DWill wrote: I don't know, Robert, "get out of the way" may have helped us achieve, here in the U.S. cities such as Detroit and St. Louis that we have decided to give up on, hulking wrecks symbolizing our social failures. There has to be some socialism, in my view; that is, government acting to preserve and direct to a degree. Whether that is always efficient may not be the most important thing. France makes huge efforts to support its agricultural industries (including, of course, wine). Do we want this kind of heritage to be swept away through creative destruction?
I don't disagree about the futility of government picking economic winners and losers, though.
Detroit is a government-created disaster, aside from the inability of some US firms to compete globally.

http://www.washingtonpost.com/news/on-l ... t-the-who/

And yes, agricultural subsidies (including in the US) are hugely wasteful, helped by the propaganda about the small farmer, and the phony horror story of not being able to buy food. Billion-dollar agribusiness is the beneficiary at the expense of consumers and taxpayers.
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Re: Ch. 2: The Cup Runneth Over

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Interbane wrote:
Robert wrote:Capitalism is founded on the principle of equality of opportunity.
I agree to an extent, but this should be clarified. Capitalism works best with equality of opportunity as one of the founding principles. But it isn't a necessary founding principle. When left unchecked, Capitalism strays away from equality of opportunity. The primary concern of a capitalist society is production and profit, which means other concerns are secondary, including fostering equality. Of course many good things align with increased production and profit, but it's also true that many things don't.
It's always equality of opportunity that capitalists extol, which is always going to produce an inequality of results, because some people don't take advantage of opportunity for one reason or another. That's the belief as I see it. Equality of opportunity could never really exist, but the U.S. is said to be the country that has come closest. I have no proof that this is so, but am willing to accept it.
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Re: Ch. 2: The Cup Runneth Over

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Dexter wrote: Detroit is a government-created disaster, aside from the inability of some US firms to compete globally.

http://www.washingtonpost.com/news/on-l ... t-the-who/

And yes, agricultural subsidies (including in the US) are hugely wasteful, helped by the propaganda about the small farmer, and the phony horror story of not being able to buy food. Billion-dollar agribusiness is the beneficiary at the expense of consumers and taxpayers.
Detroit's governance problems seem to be mostly on the local level, with Dingell running interference in Washington. Do Detroit's problems in any way evidence too little involvement by the federal government? I'm just asking the question.

My guess is that farm subsidy programs are common in many countries. They could do more good here if they were reformed to target producers of foods we actually should be eating more of, vs. corn and wheat.

http://opinionator.blogs.nytimes.com/20 ... them/?_r=0
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The word globalization makes me think of the world developing into one huge marketplace, but it also carries with it the blurring and lessening of political divisions that would seem to naturally follow from a world more economically interdependent. That's the "Star Trek" version of the world growing up to a unified whole where conflict has ceased to be necessary. But the latter part of the thought is wrong according to Zakaria: the world is becoming more, not less, segmented politically, with both nationalism and sub-nationalism on the rise. It's one of the paradoxes of globalization, a troubling one to the extent that mobilizing the world for such causes as climate change becomes more difficult. The trend is toward ever-greater decentralization, Zakaria says, owing partly to the ability of groups to be players in the world economy without needing to rely on a central government.

Another irony he speaks of is "globalization striking back" in the U.S. With the "rise of the rest," other countries have been able to extend their economic reach to our shores. We jingoistically see this as as an affront to our rightful world dominance, but it is simply a logical consequence of our success in building markets for our goods all over the world. With more money to spend, countries naturally start trying to do what we did ourselves, find new markets besides domestic ones. Zakaria says we needn't be worried about being overtaken by any other country either economically or militarily, but just having China in our rearview mirror makes us nervous.

The example he gave of Chinese superiority in shipbuilding and exploration almost a century before Columbus was fascinating. A few decades after Columbus, however, the "international" phase of Chinese history took a four-century break. Why? Theories abound, and Z. mentions a few. Nothing seems to be permanent in world affairs. I'm not sure whether Jared Diamond covers cyclical patterns such as we now see with China's ascent. Geographic determinism wouldn't apply here.

Christianity might have been key in allowing Europe to flourish, while perhaps Asian religion tended to promote stagnation. Interestingly, in the China and India chapters, Z. suggests that freedom from the doctrinal roadblocks of the Abrahamic religions might be greasing the skids for the two countries.
Last edited by DWill on Mon Aug 31, 2015 8:42 pm, edited 1 time in total.
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