Reality Around Inequality Determines Change

Nietzsche insists that there is no such thing as absolute truth, and argues instead that all thinking and perception comes from a particular perspective, and that different perspectives will produce different perspectives of truth, there are only these views or interpretations, there is no objective reality beneath them, no independent standard that they refer to. Instead of using truth as the highest standard of value, Nietzsche argues, individuals need to develop their own powers of judgment and to produce ideas and ethics that will strengthen them and help them to live. By making inequality a central part of their vocabulary progressives can take control of the debate. How you label things is more important than how you debate them. Once the middle class understands the extent of economic inequality in the system, they will posses the knowledge for them to recognize the need for change.

Whoever controls the language controls the debate, thus society influences the way we see the world. The answer to the question has to do with power and whoever has the power defines reality. We live in a country that is dominated by the perspectives and ideals of a segment of society, rather than all of society. We need only look at who are in positions of power, such as politicians and corporate leaders, as well as who is represented in mainstream media, to find the answer to which segment of society has the power to define reality. When only a fraction of society holds the power to define what is real and what is not real, the rest of us are left living by their rules. The level of equality of opportunity determines how people perceive inequality. Societies in which individuals have the same chances to obtain valuable outcomes such as income, education and health, have a higher tolerance to inequality.

Knowledge refers to an expertise or skills possessed or acquired by an individual. Knowledge refers to an understanding of the world around us that helps us to lead our life as a member of society. It helps to predict events and hence to mitigate the suffering or enhance the well-being of individuals and groups. We commonly understand that acquisition of knowledge is possible through two fundamental means: by experience (empirical) and reasoning (logical). Knowledge often gets tagged with a connotation of truth. Accordingly, if something has to be considered as knowledge then it has to be true. Only if it is true it qualifies as a form of knowledge otherwise it is not considered as part of knowledge. However, in practical life not all forms of knowledge can be subjected to the test of truth and falsehood. There are forms of knowledge which cannot be subjected to this test yet are very much essential to lead our life.

The desire for knowledge, Nietzsche argues, stems from hubristic self-focus and is amplified by the basic human instinct for belonging — within a culture, what is designated as truth is a form of social contract and a sort of “peace pact” among people. Domination is exercised by a particular group in order to sustain and enhance themselves in a privileged position. Marcuse observes that the system doesn’t require force – just introduce one-dimensional thinking – which leads to acceptance of oppression and surplus repression. The system must make the citizen think they are freer than they actually are. This means the economic elite must control the political discourse, not the workers. The ideology in place ensures the oppressed identify with the oppressor. The desires of the individual must conform to the desires of the economic elite. It is necessary to expose the contradictions by which today’s advanced industrial society is constituted.

Reality is subjective. Reality is shaped by one’s place in the world. It is in the interrelatedness of power, knowledge and truth, and the way they are expressed in discourse, that Foucauldian social reality is defined. That means, what we tend to take for granted in our everyday lives as being our social reality, actually is a complex of historical, cultural, institutional, and intellectual relations all imposing their ‘forces’ on the subject. Together, history, culture, and institutions are powers that represses and restricts the subject and determines an individual’s life. Power is all about people acting in ways that blindly and impersonally condition others’ options to act. A society is not a static body, because what constitutes society are the individuals and their actions. And it is in their actions that they do not just follow the standards of society, but, as Foucault also so strongly emphasized, it is in the deviations, the ruptures, the unforeseen and unstructured behavior of the individual that society is constantly ‘forced’ into changes.

Considering that 95% of one’s thoughts are repeated daily and reflect our own beliefs, the idea that our thoughts shape our reality is a powerful one. To a certain extent, we all know that this is true. Our mindset and thoughts govern our actions, which lead to the paths we take in life (hence, shaping our reality.) Every interaction, conversation, process, and personal thought that happens over the course of the day – both good and bad – plays out in your head as much as it plays out in reality. You might be in an elevator with a co-worker, but your brain is also going through this conversation on its own. What matters is the way you perceive these things to be happening. It’s here that you want to try and make change happen. If you draw inaccurate conclusions about who you are and what you’re capable of doing, you’ll limit your potential.1

Norman Vincent Peale’s “power of positive thinking,” supports the American belief in self above all else and the conviction that thoughts can be causative, that basic assertion can lead to actual achievement. “Stamp indelibly on your mind a mental picture of yourself as succeeding,” Peale urged his millions of followers. “Hold this picture tenaciously. Never permit it to fade.” It was a mindset perfectly tailored for an ambitious builder determined to change the skyline of one of the globe’s great cities. In politics this supports President Trump’s relentlessly optimistic insistence on his own version of reality. And though it certainly was not conceived with this in mind, the science of self-help – of happiness and well-being, of specific phenomena called “unrealistic optimism” and “positive illusions” – is now in some respects embodies the way Trump thinks, and as such, creates significant uncertainty for the country and beyond.2

There’s no getting away from the fact that the gap between rich and poor is getting wider in America. After all, President Obama called economic inequality “the defining challenge of our time.” Researchers found Americans overestimate the amount of upward social mobility that exists in society. By overemphasizing individual mobility, we ignore important social determinants of success like family inheritance, social connections, and structural discrimination. This unique brand of optimism prevents one from making any real changes – only 5% of Americans think it is a serious problem in need of addressing. That’s a shocking statistic when you consider that over the past three decades, the share of household wealth owned by the top 0.1 per cent has increased from seven per cent to 22 per cent. In fact, things have got to the point where the United States is now the most unequal of all Western nations.3

It has been argued that reality is not an absolute, that each individual has his own perception of reality. Reality is the state of things, as they actually exist, rather than as they may appear or might be imagined. There is a tension between reality and truth. Reality is a construct of beliefs about the world we hold as true. Truth in itself has nothing to do with reality, applied to beliefs and utterances, however, it contributes to the constitution or maintenance of a reality. What people perceive is usually what they believe, and this is based on what they hear, see and think. One cannot therefore speak of universal truth; truth is necessarily local, relativized to specific individuals or communities. The American Dream that any American can reach economic stability through hard work, and that children will have a higher standard of living than their parents, is no longer true.

The reality is that prosperity is marred by the growing inequality in the distribution of wealth, income, and opportunity; a rapidly restructuring “new economy” that is destabilizing older patterns of work and community; ethnic tensions sparked by the steady arrival of “new,” racially “other” immigrants. The truth is most Americans are treading water as the rich are grabbing more income for themselves through campaign contributions and lobbyists. The perception – barely half (47%) of Americans think the rich-poor gap is a very big problem. Increasing concerns about inequality are more likely to be manifested in desires for policies that enhance opportunities in the labor market rather than redistribute income by the government. Today’s knowledge has a significant but relatively small effect on norms about inequality. Progressives need to own this issue – to define the reality of inequality in America in order to ensure change occurs via the ballot box.

1 Jake Heilbrunn (06 April 2016) Power of the Mind – How Your Thoughts Create Your Reality

2 Michael Kruse (13 Oct 2017) The Power of Trump’s Positive Thinking

3 Nicholas Fritz (31 March 2015) Economic Inequality: It’s Far Worse Than You Think

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The Pathway to Attaining Sustainability

Randall G Holcombe recognizes that “government was not created for the benefit of its citizens, it was created for the benefit of those who rule.” State socialism has failed and so has the trickle-down market. Richard K Moore asserts, “power (be it economic or governmental) is the problem – not who holds it…” The obstacle to change is about escaping from elite domination. Man has produced imbalances not only in nature, but, more fundamentally, in his relations with his fellow man and in the very structure of his society. The imbalances man has produced in the natural world are caused by the imbalances he has produced in the social world. The common theme that runs through all these things, and what must be changed, is that they are all aspects of a capitalist ideology manipulated by an economic elite. The situation offers the opportunity to argue for the fundamental transformation of society as the only alternative to attaining sustainability.

One of the popular myths is that personal consumer choices can move us towards sustainability. Before buying in, we should be asking ourselves who benefits from this. While one shouldn’t think there is anything “bad” about trying to make consumer choices that are less exploitative or less cruel (if that is possible) we need to understand that this only mildly alters the details of the existing system without challenging the paradigm itself. For example, alternative energies are similar in that they attempt to operate only within the context of industrial society and extraction culture. They simply seek to alter details, not to facilitate a paradigm shift. Civilization and complex society, necessarily result in social stratification or hierarchy. To adequately fulfill all the functions needed to maintain civilization and mass society, authority and submission, division of labor, specialization, etc., emerge. However, no civilization has ever achieved sustainability.

Almost every aspect of modern life is contributing to the changing climate, from air transportation, to our reliance on cars, to how goods are produced and transported, how our food is grown, and how we light and heat our homes. A century ago it would have been possible to regard air pollution and water contamination as the result of the self-seeking activities of industrial barons and bureaucrats. Today, this moral explanation would be a gross oversimplification. Without any doubt most corporations are still guided by a public-be-damned attitude, but there is a more serious problem than the attitude of the owners is the size of the firms themselves. The issue is their enormous proportions, their location in a particular region, their density, their requirements for raw materials and their role in the national division of labor. Regardless of the reason, it’s been clear for quite some time we are only paying lip service to sustainability.

People have been pointing out the environmental problems of industry since industry’s beginnings. Yet, approaching the problem through conventional politics hasn’t gotten very far. We haven’t been able to legislate our way out of climate change, nor have we even mitigated some of the more solvable effects of industrialized society, like water pollution from agriculture. Most people hold onto the idea that it is merely the regulatory agencies, or the particular political party in power, that are to be held accountable for this, but perhaps existing social conditions are inhibiting development. People – in the U.S. in particular, but the world over as well – have lost control over government, which means a loss of control over the economy and its negative effects. In our ‘democracy’ of corporately-funded elections, ubiquitous lobbyists, an impotent when not sycophantic mainstream media, and an (understandably and increasingly) cynical, jaded electorate, can we expect to regain control of the government, as it currently is structured?

Rex Tillerson, former Chairman, President, and CEO of Exxon Mobil Corporation, best expresses the view advocating adaptation and a lack of concern for the consequences. Tillerson “told a New York audience that global warming is real, but dismissed it as an ‘engineering problem’ that has ‘engineering solutions.’” In response to the objection that changes to weather patterns will severely affect crop production, he said “we’ll adapt to that.” The “climate crisis” should be spoken of as climate catastrophe because this is what it is for the majority of the peoples of the Earth. A recent study estimates that in the next sixteen years, 100 million people will die as a result of the changing climate. Ninety percent of these deaths will occur in poor countries, which speaks to the racist and class dimensions of the climate crisis. It is primarily poor people of color, living in what once was called the Third World, who have contributed the least to changing the climate, but who will continue to suffer and die as a result of it.1

The forces responsible for changing the climate and endangering the future of humanity have names. Names such as: Chevron and Exxon Mobil, Saudi Aramco and Petroleos de Venezuela. They are the predominant groups responsible for playing havoc with our collective future. In fact, two-thirds of historic carbon dioxide and methane emissions can be attributed to exactly ninety entities. While these are the primary economic forces responsible for climate change, it would be a mistake to think if we stop these particular companies from conducting business as usual, we can solve the problem. They are only the most public faces of a system that goes much deeper. The driving force of climate change is the capitalist profit motive and confronting this effectively will require massive grassroots local organizing with an international perspective. It is necessary to seek a path to sustainability to get us out of the climate crisis.1

The climate crisis offers damning evidence that trickle-down economics has become socially useless. We should not rely on fear of an impending apocalypse as motivation for people to drop their daily routines and get involved. People can simply refuse to accept the reality or fact as a defense mechanism. The danger is that news of how bad things are getting, and how much worse they are likely to become, can result in fear and denial, and actually be counterproductive in generating a movement. Presenting people with an alleged threat to their well-being will elicit a powerful emotional response that can override reason and prevent a critical assessment of these policies. As author Mark Vernon has noted “… the politics of fear plays on an assumption that people cannot bear the uncertainties associated with [risk]. Politics then becomes a question of who can better deliver an illusion of control.”

Antonio Gramsci asked: why did the revolution succeed in Russia, and not in Italy or anywhere else in Western Europe, where classical Marxism had predicted it would be more likely to occur due to the more advanced development of capitalism? He argued that the reason for this failure was an incorrect understanding of the workings of power in modern capitalism: while Marxist revolutionary practice had assumed that political power was concentrated in the state apparatus, Gramsci suggested that power also rested in the institutions of ‘civil society’ or the structures and organization of everyday life. The revolution would therefore have to aim not only at conquering state power, but much more importantly, to create an alternative civil society, which would have to be able to attract the majority of people by convincing them of the validity of the project, which was in turn premised on its ability to perform.2

Today’s global development agenda aims to provide an expanding global population with the high-impact material affluence enjoyed by the richest parts of the world. This is despite evidence crying out that the universalization of affluence is environmentally unsupportable and not even a reliable path to happiness. The social costs of globalization include the costs of production that are not born by the producer or included in the price of the product, underemployment, lost tax base, rising trade and current account deficits from offshoring of manufacturing and tradeable professional services. We should talk more about what an economy is actually for: satisfying needs, creating a better society and improving our quality of life. Once we do that we see that continuing down this present path can be counter-productive, as well as impossible in a finite system such as the planet we live on. Considering the ecological disaster as one long-term crisis, we could restructure society to not only ‘save the planet’ but also support the full development of our positive humanity.

The path to sustainability requires meeting the basic needs of all and extending to all their aspirations for a better life. Sustainable development is the development that meets the needs of the present without compromising the ability of future generations to meet their own needs. These ‘needs’ are the essential needs of the poor and marginalized, and the limitations imposed that require a change in social organization. The change in social organization must address a political system in which a handful of very wealthy people and special interests determine who gets elected or who does not get elected. The future of sustainability should be one in which candidates are not telling billionaires at special forums what they can do for them. The paradigm shift has candidates speaking to working people, the middle class, low-income people, the elderly, the children, the sick, and the poor – and discussing with them their ideas as to how to improve lives for all while attaining sustainability.

1 Messersmith-Glavin, Paul (15 April 2015) Organizing Against Climate Catastrophe.

2 Mueller, Tadzio Empowering Anarchy Power, Hegemony, and Anarchist Strategy.

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Populism: A Symptom of the Disease Weakening Democracy

In contemporary usage, “populism” is generally understood to mean political movements and individuals who channel widespread alienation and frustration by claiming to speak for “the people” against forces that are said to be destroying cherished ways of life. “The people” in Western societies are, for the most part, implicitly understood to be white and Christian, blurring the line between race and religion. Contrary to the neoliberal belief that economic globalization would ensure the triumph of Western-style democracy, it appears that democratic institutions everywhere have been weakened by their inability to satisfy an increasing number of voters. In established democracies, major political parties have either been taken over by populist forces, as is the case for the US Republicans, or lost ground to them, as in France. The apparent failure of globalization seems to have energized the right to a greater degree than it has the left.

The essential difference between populism and democracy is that democracy entails more than majority rule. Alexis de Tocqueville’s warning of the “tyranny of the majority” remains relevant today. The protection of political freedoms and minority rights is an essential test of democracy. Populist leaders not only attack the institutions of global capital, they also disregard the checks and balances of institutional democracy. This creates a dichotomy between “the people” and the (largely unspecified) “ruling elites”, despite the reality that populist leaders themselves are clearly part of the latter. No matter. Their ability to channel anger and frustration at the status quo, and to promise easy solutions, seemingly grants them immunity from being attacked for their own exploitation of the system. Trump, Putin and Erdoğan are all notable for the extent to which they profit personally from their control of state institutions.1

We need to realize that something is actually happening in the Western countries that is not happening in developing counties. As national economies are increasingly subject to the flows of international capital, the ability of governments to control them declines. This has resulted in increased economic inequality in wealthy countries and led to greater voter dissatisfaction – and a search for political scapegoats. An emphasis on nationalism is one manifestation of this search. They distrust the intermediaries of liberal democracy – parties, pressure groups, media – preferring to resort to rallies and direct contact between leaders and mass audiences. Populism, observes Moisés Naim, is a strategy to obtain and retain power now propelled by the digital revolution and the threatened insecurity created by the neoliberal project. Populism is not new, it’s a ‘rhetorical tactic’ that demagogues around the world have always used to gain power and to hold on to it.2

As “identity politics” becomes increasingly understood as the politics of victimhood rather than empowerment, it is essential to remember that no one movement has a single identity, nor can it achieve liberation without larger social and political change. The current language of “equality” centres almost entirely on civic and political rights, not on social and economic equality. In human rights language, these are first- and second-generation rights. To people struggling to survive in a rapidly changing economy, this emphasis on “rights” can sound dismissive and elitist – one of the standard complaints about identity politics. Ever since Donald Trump rode a wave of white working-class support to defeat Hillary Clinton in the 2016 election, an important debate has emerged among progressives over how to reorient their message to incorporate “identity politics” together with addressing the economic gap. We need a politics of shared values rather than one based on separate identities.

Growing cynicism about politics is also, in part, the product of neoliberal attacks on the state, which depict governments as disconnected from real lives and bent on taking away our money and our freedoms. The past few decades have seen a systematic delegitimization of the idea that the state exists to provide collectively what we cannot provide as individuals. This leads to declining commitment from more and more people to maintaining public services, and increases inequality. Not only have unions declined, so too have middle-class business and social associations that often provided the base for the conservative parties. The Brexit campaign as well as Donald Trump’s bid for presidency were intensely shaped by ‘post-truth politics’ with false information circulating widely on social networks and voters believing in lies publicly conveyed by opinion leaders. Populists thrive on a mix of passion and ignorance, and they need to be countered on both levels.

A democracy relies on power-sharing arrangements, courts, legislatures and a free and independent media to check executive power. Since these institutions obstruct the free reign of populists, they are often subjected to blistering attack. This is especially the case with the right-wing variety of populism that is spreading across the U.S. and Western and Eastern Europe. Martin Gilens and Benjamin Page have shown that economic elites and the organized groups representing their interests powerfully shape U.S. government policy, while less well-off Americans and the mass-based interest groups that represent their interests have essentially no influence over government. Perhaps because they recognize how little influence they have over government, lower-income citizens participate less at every stage of the political process – voting, contacting candidates, taking part in campaigns and demonstrations – than do those with higher incomes. Low levels of participation are linked to diminished government effectiveness as well as increased dissatisfaction with democracy.3

Populists claim to talk in the name of the people, but scorn the idea that politics is an elaborate system of building consensus through persuasion and mutual respect. Populists may claim to talk in the name of the people, argues Jan-Werner Müller in his study, but one should not be deceived. When populists actually assume power, he warned, they will create an authoritarian state that excludes all those not considered part of the proper ‘people’. Populism is invariably divisive, thrives on conspiracy, finds enemies even when they do not exist, proceeds to criminalize all opposition to it, plays up external threats, and more often than not insists its critics are working for ‘the deep state.’ With respect to the health of democracy, therefore, beware of the populists. They may talk the democratic talk, but hidden behind all that rhetoric is a dangerously anti-democratic impulse.2

Populism, Frank Furedi argues, has virtually become a term of abuse directed against anybody critical of the status quo. Worse, it implied that the revolt facing the West today was not a legitimate response to deep-seated problems but was rather the problem itself. Globalization has resulted in significant increases in GDP for countries like China and India, but for the West generally, the past thirty years created down-side problems as wealth became ever more concentrated in the hands of a few, middle class income stagnated, and underemployment became legitimized. Thus, what was great for the corporations and the consumer turned into an economic tsunami for traditional bastions of labor. Populism, the revolt facing the West today, appears to be a legitimate response to deep-seated problems associated with globalization, and not the problem itself. This poses the question whether populism is a symptom of the disease, rather than the disease weakening democracy.

James Montier and Philip Pilkington note the problems associated with globalization can account for a great deal of the reason for the rise of populism because of ‘a broken system of economic governance’. They claim neoliberalism arose in the 1970s and has been characterized since by four significant economic policies and only one of which they identify as globalization and these are: “the abandonment of full employment as a desirable policy goal and its replacement with inflation targeting…; a focus at the firm level on shareholder value maximization rather than reinvestment and growth…; and the pursuit of flexible labour markets and the disruption of trade unions and workers’ organizations.” This neoliberal paradigm has skewed the balance towards capital and away from labour. Moreover, instead of triggering change, the 2008 crisis accentuated the flaws in this format of globalization, laying the groundwork for the populists.2

Populism is very much an expression in the West of a sense of powerlessness: the powerlessness of ordinary citizens when faced with massive changes going on all around them; but the powerlessness too of Western leaders and politicians who really do not seem to have an answer to the many challenges facing the West right now – powerless to prevent off-shoring and tax avoidance. In turn, many ordinary people might feel they have no control, and express this by supporting populist movements and parties who promise to restore control to them. If politics is the art of the possible then what is possible is itself determined by political choices and requires debate and coalition building. The new policies to strengthen democracy need to address the growing economic gap and create opportunities for all. The disease affecting democracy is the neoliberal aspect of globalization, consequently populism is a symptom not the disease.

1 Dennis Altman (30 July 2017) Discontents: identity, politics and institutions in a time of populism.

2 Michael Cox The rise of populism and the crisis of globalisation: Brexit, Trump and beyond.


3 Sheri Berman (08 Jan 2018) Populists have one big thing right: Democracies are becoming less open.

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The Well-being Agenda: Measuring Economic Progress

In a distinct vision of the good society envisioned by Friedrich Hayek, Milton Friedman or Gary Becker, individual liberty and freedom can best be protected and achieved by an institutional structure, made up of strong private property rights, free markets, and free trade: a world in which individual initiative can flourish. Well-being would be tied to economic freedom and the inclination to act in ones own self-interest. The theory worked well for the economic and political elite until the financial crisis, then neoliberalism was unable to provide many individuals with the sense of the good life that they longed for. Happiness was to be found in this super competitive environment, if only people worked hard enough to personally achieve it. All unhappiness and dissatisfaction is reduced to a lack of positive attitude. In this fantasy ‘choice’ economy structured barriers to aspiration, achievement and contentment were supposed to melt away.

Gary Becker’s position was that we can understand all social life through the lens of the market (e.g. education, crime, marriage, etc.) Becker’s perspective is interesting because it comes closest to assuming that everything is already a market and, therefore, there is no need to work towards a society in which perfect markets determine our decisions. We’re already there, according to Becker. Every decision and choice can be conceived as a market decision, a finely honed calculation of the benefits and costs of every action we take. If we accept that everything has a market price – that is, the market is expanded to include all social activities – then the benefits of markets are only ensured with the intensification of these market transactions (i.e. frequency, speed and shortened duration) since the market is only efficient if it’s able to re-price everything constantly under conditions of market competition.1

Increased ‘flexibility’ is part of this ‘perfect market’, but it makes it harder for individuals to separate their work from their life. Underneath the freedom of always being your own boss is the reality of fiscal precarity mixed with never having enough time for yourself. All happiness and dissatisfaction is reduced to lack of positive attitude. Since social class is no longer relevant, everybody ends up with the socio-economic position they deserve. This produces a chronic sense of self-blame, unease, anxiety and self-recrimination, with individuals having nobody to blame but themselves for not being famous, very rich or more attractive. The absurdity of the situation is that you can play the neoliberal game to perfection, and still end up with very little in return. Positive psychology enables a new happy subjective perspective from where happiness, rather than a long-term objective, is considered to be a precondition of work, a radical new form of human capital.

There are obvious flaws in neoliberalism, which appear not only at the level of the individual, but also the city, nation, school or university, namely that it views ‘excellence’ and ‘winning’ as the mark of value. But this implies that being normal, average (let alone below average or ‘sub-normal’) is to be without value. The majority of people, institutions and spaces are eliminated via competition, and found to be too weak to excel. Moreover, because it was a competition that revealed this – and not, say, tradition or the power of class stratification – they have only themselves to blame. There’s been a rising sense, since the 1960s, that health is the opposite of pain and unhappiness. One effect of this shift is to pass responsibility for mental well-being towards the individual, directing them to self-help techniques and drugs to address their own unhappiness, which is also a way to avoid  making it part of a public discussion.

Instability and insecurity are also hugely damaging to well-being. The promotion of ‘flexible labour markets’ in the name of growth and competitiveness may therefore not make us better off if it leads to the proliferation of insecure work. A recent paper by economists at the London School of Economics even suggested that capitalist instability might help to explain why well-being has failed to increase over recent decades in countries like the US and UK. For example, the New Economics Foundation’s analysis of European data found that the difference in well-being between temporary and permanent workers was actually greater than that between temporary workers and the unemployed. If this seems surprising, that’s perhaps because we so drastically underestimate the anxiety and stress caused by insecurity.

Donald Trump ran on a promise of restoration, a nostalgia for a time gone by, and the sense that America, particularly white America, is losing and has been losing for years. He promises to bring back the kind of greatness that once existed, but has been taken over by the politically correct that is too focused on diversity to recognize and support the forgotten white man. The problem is that this is also the context that fascism thrives in, with its own seductive promise of solidarity.2 With the failure of the neoliberal paradigm to deliver for most, the most powerful political force in the world one could tap into is nationalism. As Orwell said, “A nationalist can justify anything in the cause of ‘protecting’ his construct of the state.” Used intelligently, the concept of well-being can open up political space to debate the things that really matter to us, both as individuals and as a society.

The present economic model is broken – failing to make us better off. It is necessary to produce a model of mind and body more suited to the post-industrial workplace, in which positivity and energy are viewed as the source of economic value. Amongst the most worrying practical effects has been the incorporation of positive thinking into workfare programs, with benefit claimants being told that their negative attitude is the reason they are unemployed, and they must therefore overcome that using various cognitive and behavioural techniques. This, and other examples, produce an ideology in which the social world is a fixed set of institutions, no matter how unjust, but the psychic-emotional world is sufficiently malleable as to compensate for that. The well-being agenda is not just a sideshow to neoliberal economics: it points towards a new economics, one which values equality, stability and community rather than simply growth for growth’s sake.

The IMF now suggests that inequality undermines growth itself. So the neoliberal project does not address social welfare. Well-being data indicate going for growth while ensuring the markets work efficiently to allocate goods to people who value them most, then social welfare is not optimized. A rising tide does not lift all boats. It now appears that reducing poverty and promoting equality are more important goals than simply increasing the size of the economy. Well-being should not be placed outside the economic sphere – seen as nice-to-have, a luxury for good economic times, hardly a priority in a recession. The problem is that people tend to sit well-being atop of the neoliberal economic approach to economic policy, rather than rethinking or challenging it. A focus on well-being would provide support for a more radical economic agenda – one that cares more, not less, about reducing poverty and inequality.3

The truth about most situations is we know what will make people better. Individuals require stability or adequate predictability for a person to concentrate on the here-and-now, and on future growth and change, and where small obstacles do not set off big cascades. Of importance is safety, the degree to which a person can be his or her authentic self and not be at heightened risk of physical or emotional harm. Where there is adequate predictability a person feels in control of his or her fate and the decisions he or she makes, and where he or she experiences some correlation between efforts and outcomes. Meaningful access to relevant resources ensures a person can meet needs particularly important for his or her situation in ways that are not overly onerous, and are not degrading or dangerous. From the key elements for well-being – happiness, optimism and self-worth – comes the belief the desired result is achievable.

Alleviating poverty and inequality need to be core and explicit goals of macroeconomic policy. We need a new emphasis on positivity in a system that presently informs you at every stage you are already a loser. This affects mental health – the effect is magnified the more unequal the society. This problem is particularly acute for those already caught up in the punitive grip of ‘incarcerative care’. Societal progress is about improvements in the well-being of people and households. For well-being measures to start making a real difference to people’s lives, they have to be explicitly brought into the policy-making process. The measuring well-being agenda calls for new and improved statistical measures, aimed at filling the gap between standard macroeconomic statistics that sometimes are used as proxies of people’s welfare, and indicators that have a more direct bearing on people’s lives. These will augment statistics such as GDP that do not provide a sufficiently detailed picture of the living conditions that ordinary people experience.4

1 Kean Birch. ( 29 Jan 2016) How to think like a neoliberal: Can every decision and choice really be conceived as a market decision?

2 William Davies (16 Oct 2017) Mental Health and Neoliberalism

3 Christine Berry (23 April 2014) Well-being is more than a side-show to neoliberal economics.

4 OECD Better Life Initiative: Measuring well-being and progress.

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Organizing A Response to the Happiness Gap

Being born in rich countries like Canada and the US with increasing GDP growth and prosperity doesn’t bring happiness if it comes with more risk and uncertainty. The etiology of stress is increasing income inequality and wage stagnation for the working class as well as the long-term deterioration in employment opportunities that have led to intergenerational decline in economic security. Economic decline is also measured in in terms of debt ratio. The average American household has taken on more debt to finance its lifestyle than in the past – debt typically used to buy a car or house. This fear of losing what they already have is a source of stress. Globalization and technology change is the source of much uncertainty in modern lives. There is social stratification in psychological health in America – since 2008 the rich are getting happier, while those who have been left behind are getting sadder.1

During the 1800s, angry workers organized responses to the unfair practices of the industrialists. In Britain, Luddites confined their attacks in the 1830s to textile manufacturers who used machines in what they called “a fraudulent and deceitful manner” to get around standard labor practices. They wanted workers to go through a proper apprenticeship and be paid a decent wage. Fearing a national movement the government passed legislation and moved in troops around the mills to crush the movement. The Progressives in America of the 1880s believed the government had to be involved in solving social problems. It began as an outshot of farmers hurt by declining crop prices, devaluation of currency, protective tariffs on manufacturing and the natural monopoly of the railroads. They brought forward radical ideas such as the graduated tax – percentage of tax you pay as your income rises.

The 2016 Brexit referendum and the Trump election highlight social crises as unhappy voters rejected the establishment, demanding change. Donald Trump tapped into a wide and growing optimism gap that opened between the white middle class and the poor. His support came from blue-collar whites who are insecure and facing much more competition for their jobs than their parents did. On the other hand, poor and middle class blacks compare themselves to their parents who were worse off than they are. Trump’s answers include policies about turning back the clock – tariffs and curtailing immigration. President Trump’s fake populism directs his followers downward against marginal, and outwards against foreigners, rather than upward against the powerful. A Polish study found that people who felt less in control of their lives were more likely to show signs of collective narcissism. Trump’s people tapped into collective narcissism – which they continue to draw on at post-election rallies.

Freud observed, “A good part of the struggles of mankind centre around the task of finding an expedient accommodation – one, that is, that will bring happiness between the claims of the individual and the cultural claim of the group.” For Freud, society attempts to oppress the individual into its requirements, consequently the individual can never have full happiness. In neoliberalism, governing occurs by providing individuals with choices and holding them accountable for the choices they make. This system has a diminishing appreciation that individual predicaments are a product of more than simply their individual choice, and includes access to opportunities, how opportunities are made available, or the capacity to take advantage of opportunities offered. Postmodern political science observes people resist realistic concepts of power which is repressive – Foucault claims individuals engage in daily practices and routines of self-discipline that subjugate themselves – in order to maintain a claim on their own identity and happiness.

Excessive psychosocial stress is associated with the adoption of health threatening coping behaviours. Increased insecurity for low skilled workers is associated with rising mortality rates. There is a drug problem – people find opiates so pleasurable they eventually become addicted and dependent on them. Opioids attach to receptors in the brain that create something called the opioid effect. They block pain, and depress the central nervous system, as well as creating a sense of calm, and of course, happiness or what can even be described as bliss. The opioid epidemic is starting to overtake gains in previous years from heart disease and cancer. Opioid deaths are fueled by fentanyl overdoses. Unintentional injuries (which includes overdoses) became the third leading cause of death in 2016, moving up from the 4th leading cause in 2015 in the US. The opioid epidemic alone is deadlier than the AIDS epidemic at its peak.2

The neoliberal model insists on comparison, evaluation and quantification, and now people are technically free but powerless. At the individual-level, neoliberalism insists that rationality, individuality and self-interest guide all actions. Neoliberalism sees the new normal as empowering individuals, and the shifting economy as a valid reason for underemployment with its increased insecurity. Far from responding to the needs of consumers, capitalism thrives on the constant creation of unsatisfied needs; far from generalizing prosperity, capitalism generalizes want; far from relieving the burden of labour, capitalism constantly intensifies labour, to the extent that a growing proportion of the population are unable to meet the demands of the neoliberal system while being continually besieged with false promises. The economic elite demand a dressed-up sophisticated economic theory be applied to society regardless of the outcome which has nothing to do with economics but everything to do with power.

Austerity is traditionally defined as economic policies surrounding deficit cutting. Pablo Iglesias argues that austerity is when people are forced out of their homes, when social services do not work, when public schools lack resources, when countries do not have sovereignty and become colonies of financial powers. Neoliberal austerity policies are the biggest bait and switch in history. The 2008 financial crisis, caused by a financial sector lending too much, led to bank bailouts that increased the public-sector debt. This led to an outcry about public debt, rather than financial sector mismanagement. Because of all this spending, they claimed it is now necessary to introduce more austerity. Neoliberal economic policy can only function with a state that encourages its growth by actively shaping society in its own image, and austerity is the tool to push for that transformation. As these ‘essential’ austerity programs become legitimate, it is austerity as managed unhappiness.

People can or are more willing to overlook income inequality as long as their quality of life remains unchanged. As long as the greediness within the plutocracy does not affect their day-to-day life – your retirement is funded, you can afford to take vacations – you are willing to look away while the economic elite do their thing. However, this ultimately becomes the problem – enough is not really enough for certain rich individuals. Unless there are checks and balances, the economic elite keep working the system until it breaks down. More and more find themselves in an era of insecurity as the safe routines of their lives have become undone, they now realize that the market system failed them, and this security was an illusion. Social mobility has greatly reduced so that their parents’ income, job and education now determines for many their own future social position and health to a greater degree than at any point since the Second World War.

Unhappiness is not depression; it is a structural problem. The imperative for striving for higher and higher levels of self-improvement brings new narratives of suffering. Individuals are worried about never being able to catch up, giving them a sense of meaninglessness, emptiness and depression when they feel overburdened with responsibilities attached to the project. This is the root cause of the epidemic of mental illness – anxiety, stress and depression – seen today. A study by Gerdtham et al. (1997) found good health to have a significant positive effect on happiness. As health is a strong determinant of happiness then there is every reason for enhancement of health to be a policy priority of the state. Today the causal interaction between happiness and health is well documented. People who are happy enjoy a better health while unhappiness depletes the state of health reducing the immune resistance and originating psychosomatic disease that may lead to depression and suicide.

Uncertainty about the future makes us less capable of coping with negative events when they happen. It also disables us from taking effective and efficient steps to avoid them. This in turn, leads to anxiety and stress. We need a community response to the violence of neoliberalism and the happiness gap. It needs to be in the form of social assistance and language that encourages hope rather than stigmatizes recipients. With less reliance on long-term employment, the system still needs to offer the same level of security. This may require retirement and health benefits independent of employment, with more vocational training and tax credits for apprenticeships. The community needs these programs because companies do not have the incentive to invest in workers they used to. Quality of life factors, the most important determinants of human happiness and well-being, will create opportunities to organize our societies from a sustainable scale perspective.

1 Olga Khazan (19 June 2018) Poor Americans Really Are in Despair

2 Olga Khazan (21 Dec 2017) A Shocking Decline in American Life Expectancy

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The Good Society: An Alternative Vision of Progress

When John Locke made his pronunciations in the 18th century, the ideal of an autonomous individual was embedded in a complex system that included family and church on one hand, and on the other a vigorous public sphere in which economic initiative, it was hoped, grew together with public spirit – creating a discursive community capable of thinking about the public good. Every good society conjured up by philosophers and reformers presupposes an imaginary man managing his behavior by the dictates of pure reason and keeping in mind the long-range effects of his every action. Faced with growing homelessness, under-employment, crumbling highways and ecological disaster, our response is one of apathy, frustration, cynicism and retreat into our private worlds. Today, we search for a society built around core values: equality, democracy and sustainability. Rather than being a specific vision, or end point, the Good Society is a framework that enables us to evaluate political ideas and actions against core values.1

In a 1900 article in Rivista Alfredo Pareto commented on the radical movements at the turn of the century in France and Italy. He concluded that rather than restoring democracy and promoting social welfare, they were just seeking to replace one elite with another elite, the privileges and structures of power remaining intact. The struggle was not for a Good Society, Pareto concluded, but a squabble among elites over who was going to govern. What were the ideals and theories they claimed to fight for? Just propaganda, Pareto declared, the way upwardly mobile people manipulate the helpless, hopeless mob to take to the streets on their behalf. From Pareto’s point of view – socialism, libertarianism – all ideologies are smoke screens foisted by ‘leaders’ who really only aspire to enjoy the privilege and power of governing. He suggested class struggle is eternal, and recognized the predictions of economics fail to correspond to reality.

To seek answers, Pareto turned to sociology. He identified two factors, the circulation of elites and the irrationalism in politics. Change is associated with people always entering and leaving elites thereby tending to restore equilibrium.2 However, decisions in politics are emotional and non-rational. In such a system the function of reason is to justify past behavior or to show the way to future goals, which are determined not by reason, but by emotional wants. During the 1980s, school systems lowered educational standards to protect children from failure. The world would be saved from crime, drug abuse and under-achieving through bolstering self-esteem. In order to ensure positive self-esteem education standards were lowered, creating a milieu for extreme individualism. When there is too much self-esteem there are problems of self-tolerance, entitlement and narcissism. The culture of extreme individualism ushered in the narcissism influencing decision-making and accountability today.

With narcissism, such a person lacks empathy and does not recognize boundaries: personal, corporate or legal. The world viewed from an emotional rather than a rational perspective allows personal feelings to override the distinction between right and wrong. Individualism reinforces the person who thinks that he/she should not have to contribute to the community’s common good but should be left free to pursue his/her own personal ends. Neoliberal capitalism has nothing to do with democracy as it is now linked to a market logic that divorces itself from social cost. The harshest costs of modern economic practices fall upon ecosystems and populations with little current economic power or value, including generations not yet born. “The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.” observes John Kenneth Galbraith.

The deregulation and minimal role for government has been ‘culturally empowered’ since the 1970s through the universal intellectual deference to external authorities such as Friedrich Hayek and Milton Friedman. Their followers accept unquestioningly every word of their writings as a rational explanation for laissez-faire economics. Hayek claimed laws are to protect the liberty of the individual, even though it created a system with built-in inequality. Friedman proposed that trickle-down economics helps poor people by the trickle-down effect in which economic growth flows down from the top to the bottom indirectly benefiting those who do not directly benefit from the policy changes. With respect to trickle-down economics, the 2008 financial crisis is the greatest broken promise (or lie) of our lifetime. While neoliberalism champions that individuals have maximum freedom, a crisis exposes the clash with neoliberal interpretation of freedom and responsibilities, on the balance between personal freedom and the common good.

But even more so, we have a right to expect that the state does everything in its power to promote human flourishing, to provide the conditions under which all individuals have the opportunity to live well. While achieving moral virtue or knowledge may be largely within our power, other goods like wealth or health may be largely determined by fortune. While a good government cannot guarantee that citizens will attain moral virtue or have good lives, it can provide the condition under which this is possible, and it can help alleviate much of the injustice caused by misfortune. A ‘good society’ can only be achieved if there is an acceptance of the need to tame capitalism and strictly regulate it. A good society is a society that doesn’t hesitate to ask the hard questions, to lead and participate in critical conversations about what is important to us, what we value, what is working and what is not working.

In a world of increasing complexity and interdependence, we can no longer afford ‘to go our own way.’ Rather, we need to exercise our capacity for developing institutions that recognize our interconnectedness, moving toward the creation of the good society, where the common good is the pursuit of the good in common. We can define a new vision of progress based on social justice, sustainability and security. These are fundamental preconditions for the Good Society. Not only because ‘more equal societies almost always do better’ as Richard Wilkinson and Kate Pickett have shown in their impressive study. But also, because self-fulfillment of the individual, the right of everyone to achieve their own unique way of being human, needs social justice, sustainability and security. If these preconditions are lacking, opportunities are limited to the few. The Good Society wants to make them equally achievable for all.

The economic elite provide campaign contributions to both parties, which allow them to place key individuals in regulatory positions in Washington. This means decisions in government are handled from the perspective of the economic elite. The 2016 election exposed the level of degradation of the public sphere. A propaganda system created by the economic elite and their proxies manipulates the public through misinformation and echo chambers. Because of this control of information, the public only gets to agree, rather than provide an alternative vision of progress. The politics of fear is used as a driving or motivating factor for the people, to get them to vote a particular way, allow excesses in spending, or accept policies they might otherwise abhor. It’s banking on the fact that presenting people with an alleged threat to their well-being will elicit a powerful emotional response that can override reason and prevent a critical assessment of policies.

Markets will also not by themselves be able to ensure the ecological balance of our planet. Thus, functioning markets need rules and preconditions that will not be established by the market itself. These public goods will not be provided by the markets themselves. They must be provided by society. In a society where wealth is distributed on a performance-base, those owning or earning above average must contribute more to these public goods. The idea of social progress is based on a better quality of life for all. This goes far beyond increasing consumption, which can be provided by markets. People do not achieve sense in life through commodities you can buy on the market. Humans want to be part of the society, and are striving for security, participation and emancipation. Security means being protected against fundamental risks like unemployment, illness and old age (which is a “risk” only in an economic sense). It also means being protected against discrimination and exploitation.

The Good Society, based on the notion of sustainability understood as social, economic, and environmental sustainability, needs a functioning public sphere. The idea of a public sphere is an ideal of good and accountable governance. Its requisites are the free flows of information, free expression, and free debate. Such a public sphere is truly participatory and the best protection against abuse. In reality, we only find approximations of this ideal to create the inclusive society in which the  government might be organized to serve the collective interests of ordinary people – the public – rather than the personal interests of rulers and economic elites. Progressive politics can develop an alternative vision of progress that combines the dynamism of markets with more equal societies. The Good Society is built on the idea that more equality is possible; is values-based, and the challenge is more to bring these values back into our daily political and social lives, rather than changing them.3

1 Claire Andre and Manuel Velasquez. (Spring, 1992) Creating the Good Society

2 An Analysis of the Circulation of Elites in America (10 June 2018)

3 Andrea Nahles (31 March 2011) Equality and The Good Society

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We Must Take Back Control of the Public Sphere

The “public sphere” is generally conceived as the social space in which different opinions are expressed, problems of general concern are discussed, and collective solutions are developed communicatively. Thus, the public sphere is the central arena for societal communication. In large-scale societies, mass media and, more recently, online network media support and sustain communication in the public sphere. Jürgen Habermas thinks that the public sphere is important for democracy, facilitating participation in democracy. In its ideal form, the public sphere is “made up of private people gathered together as a public and articulating the needs of society with the state”. Through acts of assembly and dialogue, the public sphere generates opinions and attitudes which serve to affirm or challenge – therefore, to guide the affairs of state. In ideal terms, the public sphere is the source of public opinion needed to legitimate authority in any functioning democracy.

The Structural Transformation of the Public Sphere (1962) is Habermas’s examination of a kind of publicity that originated in the eighteenth century, but still has modern relevance. It begins by attempting to demarcate what Habermas calls the bourgeois public sphere. He defines the public sphere as the sphere of private people who join together to form a “public.” He traces the history of the division between public and private in language and philosophy. The most important feature of the public sphere as it existed in the eighteenth century was the public use of reason in rational-critical debate. This checked domination by the state, or the illegitimate use of power. Rational-critical debate occurred within the bourgeois reading public, in response to literature, and in institutions such as salons and coffee-houses. The public sphere was by definition inclusive, but entry depended on one’s education and qualification as a property owner.

Habermas emphasizes the role of the public sphere as a way for civil society to articulate its interests. Before the bourgeois public sphere came representative publicity, which existed from the Middle Ages until the eighteenth century, it involved the king or lord representing himself before an audience. The King was the only public person, and all others were spectators. The public and private realms were not separated. The development of the fully political public sphere occurred first in Britain in the eighteenth century. The public sphere became institutionalized within the European bourgeois constitutional states of the nineteenth century, where public consensus was enshrined as a way of checking domination. The fully developed public sphere was therefore dependent on many social conditions, which eventually shifted. The bourgeois public sphere eventually eroded because of economic and structural changes. 1

The boundaries between state and society blurred, leading to what Habermas calls the refeudalization of society. State and society became involved in each other’s spheres; the private sphere collapsed into itself. The key feature of the public sphere – rational-critical debate – was replaced by leisure, and private people no longer existed as a public of property owners. Habermas argues that the world of the mass media is cheap and powerful. He says that it attempts to manipulate and create a public where none exists, and to manufacture consensus. This is particularly evident in modern politics, with the rise of new disciplines such as advertising and public relations. These, and large non-governmental organizations, replace the old institutions of the public sphere. Advertising and internet have invaded and corrupted the private sphere. The public sphere takes on a feudal aspect again, as politicians and organizations represent themselves before the voters.

Habermas’ concept of ideal speech is a situation in which everyone would have an equal chance to argue and question, without those who are more powerful, confident or prestigious having an unequal say – an important aspect of the cultural dimension of modernism. This activity is oriented towards developing an understanding, and when agreement is reached, it is the knowledge and truth of the situation. The phenomena of blogging and citizen journalist creates challenges investigating the identification of quality information accessible via the web. Habermas claims it is not so much the possession of particular knowledge, but rather in “how speaking and acting subjects acquire and use knowledge.” The sheer diversity of information available today raises a critical question: how do we know which information to pay attention to, and which to discard?2

In response to concerns raised in the 1970s the corporate elite set in motion processes to dismantle the New Deal social compact, clearly recognizing that some people will now do with less to ensure an elite (big business) have more. This response to the crisis in capitalism also included moves to union busting. A key hegemonic claim is that the market provides a natural mechanism for rational economic allocation. Thus, attempts to regulate capital via political decisions produce suboptimal outcomes. This thinking is used to undermine the mechanics of popular engagement in determining policy. The actual individuals – the economic elite – who control the decision-making undermine other associations, like unions, under the rhetoric of personal freedom. Neoliberalism’s nonsense of individual freedom and equality, and its promise of prosperity and growth, are slowly being revealed as fabrications. Economic nationalism serves to distract the working-class from the very real questions about domestic distribution of economic resources by casting dispersion on foreigners.

The Internet was acclaimed as leading to a new age of enlightenment through easy communication and universal access to information. Instead, observers see the emergence of an increasingly polluted information environment. We face torrents of false or at least distorted tweets, video clips, and blog posts. We also observe the formation of many echo chambers, groups that reinforce those groups’ chosen visions, selecting what to accept as true, and amplifying each other’s biases. Public opinion is now manipulative, and, more rarely, still critical. We still need a strong public sphere to check domination by the state and non-governmental organizations. There are deliberate fakes created to deceive the public and then there are misleading images shared, often during breaking news situations, that are entirely unrelated to the story. The Internet is distorting our collective grasp on the truth – many of us have burrowed into our own echo chambers of information.

Neoliberalism has ushered in a new Gilded Age in which the logic of the market now governs every aspect of media, culture, and social life from schooling to health care to old age. Of course, the goal was to weaken the welfare state and any commitment to full employment, and – always – to cut taxes and deregulate. But neoliberalism is more than a standard right wing wish list. It is a way of reordering social reality, and of rethinking our status as individuals. In short, neoliberalism is not simply a name for pro-market policies, or for the compromises with finance capitalism made just to support the autocracy. It is a name for a premise that, quietly, has come to regulate all we practice and believe: that the only a way of structuring all reality is the model of economic competition. The economic elite use Internet tools, especially social media, to create distractions to advance this agenda.2

Information manufactured by people and institutions with money supports the pervasiveness of neoliberal thought that allows it to be presented and perceived not as one option, but as the only one even imaginable. In 2008 there was nothing on the other side from neoliberalism, demonstrating its ubiquity and consensual nature that the only way society’s imagination could react to the crisis of neoliberalism was more of the same. We are beholding to Donald Trump for pulling back the curtain and drawing attention to the mechanism of the social repression behind the illusion of minimal government and austerity. He governs like a king – as the only public person – re-enforcing the fact that ‘people’ are spectators with no real input into government decisions. We must begin the process to end big money’s grip on politics to take back control of the public sphere to ensure the ongoing transformation in structures of public communication in order to overcome social repression.

The neoliberal ideological project is geared to making itself invisible – is almost never mentioned in the mainstream political world. Today, the neoliberal state is the extension of the economic elite – propagated by the economic elite and their proxies who can speak no other language than that of the privileged status of capital, and who hold the belief they are serving the greater good. With the dismantling of the social safety nets and the ongoing increasing economic inequality between the wealthy and rest of society the state now becomes an agent of social repression, becoming a protection agency for the activities of the economic elite. Today “public opinion” is created at election time by the media controlled by the economic elite, thus instead of criticizing and examining the government, the manipulated public is meant merely to agree. To prevent the decline of democracy it is necessary to remove the corrupting influence of money to ensure the public sphere once more becomes the public opinion needed for participatory democracy.

1 Jürgen Habermas And The Public Sphere

2 Habermas, Jurgen. Structural Transformation of the Public Sphere

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The Dilemma of Postmodern Metaphors in Economics

When explaining something the ideal rational language is literal and straightforward and has a unique relationship to the truth. Until the last 40 years metaphors were dismissed as deviant, misleading embellishments imposed on otherwise clear discourse. Metaphors can’t change reality; only shed light on it. When people use metaphors to take liberties with reality, their words can be misleading at best and mendacious at worst. The most pervasive false metaphors occur in economics in the support of trickle-down economics. Friedrich Hayek regards the metaphor of the ‘invisible hand’ as Smith’s most important contribution to social theory. Hayek claims, “Adam Smith was the first to perceive that we have stumbled upon methods of ordering human economic co-operation that exceed our knowledge and perception.” Milton Friedman was a believer in the metaphor of biological evolution as a predictor of the economy – to help rather than replace a fundamentally mechanistic paradigm.

Since the turn of the 20th century, there has been a belief that technology and reason could make us masters of our own environment and would continue to make life better. This was part of the modernist view that all people are equal, each person has the freedom to make his own choices, therefore we can use our intelligence and rationality to make the world a better place. Also, individual rights should be subservient to the general needs of society. Metaphors are a primary method of proposing abstract concepts. Modernist thinkers viewed metaphors as a stylistic form of speech or simile that is used to make comparisons. Within the modernist tradition, metaphors are often described as mere ornaments of language and not a constitutive part of language and understanding. By way of contrast, postmodern scholars suggest that a metaphors are basic to understanding, and consequently that they are not so much a form of speech but rather a fundamental form of thought.

Postmodernism is a 1980s movement characterized by broad skepticism, subjectivism, or relativism; a general suspicion of reason; and an acute sensitivity to the role of ideology in asserting and maintaining political and economic power. The postmodernist now doubts the end project of all technological advances will be to improve our lives. The fact is that they may not deliver leaves the feeling that the quality of life will deteriorate. Now one realizes legal attempts to grant all people equally will not make it possible for all people to have the same quality of life. With such a mindset they are unable to separate rationality from emotional attachment to a particular set of cultural values that have no basis for over-ruling cultural values. The progress of history is not consistent, and life may become worse for all of us.

For the postmodernist the intellectual, liberal belief that everyone should sacrifice for the overall benefit of society has miserably failed to replace the mythic and religious arguments for altruism. Each person is not a self-made individual but is dependent on social and environmental factors in developing their values, and the social elements that most advocated individual freedoms and self-determined values. These individuals have become, themselves, a tragedy of depressed, suicidal, and self-indulgent individuals that leads to a narcissistic society, turning their backs on the poor, and the working class. Jacques Derrida’s philosophy of deconstruction has become the foundation of many postmodern ideas today. Under deconstruction the idea is to tear apart the theories of anyone that purports to prevent a theory that is grounded in some sort of reality. This concern is that people who think they have a grasp of truth are the people who try to control others and cause suffering and pain for others. They believe that there isn’t such a thing as absolute truth.

Postmodern scholars suggest that perceived realities may change as the metaphors used to understand “reality” change. Social reality is distinct from biological reality or individual cognitive reality, representing as it does a phenomenological level created through social interaction and thereby transcending individual motives and actions. Knowledge and people’s conceptions (and beliefs) of what reality becomes embedded in the institutional fabric of society. Reality is therefore said to be socially constructed. Postmodernists believe that the West’s claims of freedom and prosperity continue to be nothing more than empty promises and have not met the needs of humanity. They believe that truth is relative and truth is up to each individual to determine for himself. Postmodernists do not attempt to refine their thoughts about what is right or wrong, true or false, good or evil.1

The US has placed great trust in the compatibility of market competition with the dedication to freedom of expression. Since 1980s a succession of administrations pursued a policy based on delivering public benefits by deregulating and relying on private market mechanisms. Neoliberalism is a consequence of restructuring of class power in favour of the economic elite. It has no vision of the Good Society or the public good and no mechanism for addressing society’s major economic, political and social problems. Today neoliberal ideology defines the social relationships of poor people and the attitude towards them that supports an economic system that creates inequality. Neoliberal capitalism is associated with increasing income gradient between the rich and the rest of society. This increasing economic inequality between the rich and the rest of society over the past four decades led to the hollowing out of the middle class, leaving many people disillusioned.

Postmodernism introduces the attitude of skepticism or distrust towards ideology and various tenets of universalism. Supporters believe knowledge and truth are products of social, historical and political discourses or interpretations, and therefore contextual or socially constructed. Postmodernism is still alive in economic theory – economic truths are socially constructed. Postmodernism is supposed to be the end of the ‘grand narrative’ or the metanarrative apparatus of legitimization. Postmodernism and neoliberalism share some common themes. Both emphasize the positive role of the pursuit of individual interest and promote individual rights rather than duty to society. Questions related to the Good Society are irrelevant to both. Neoliberals advocate deregulation in economic life while postmodernists advocate deregulation in the cultural sphere. Both currents of thought place the isolated individual in the centre of attention. Everybody has his/her own culture.2 The main dilemma of postmodernism is the quest for meaning.

The postmodern philosophy can be traced to the work of Hegel and is reflected in critiques of Hegel by the Existentialists and Marxists. Hegel’s use of Greek dialectic to introduce what has become the core of the postmodern view that “truth” evolves and is culture/context dependent is the key issue in the change. The pre-Hegelian view was that truth was attached to reality and that by training our minds to weed out error, we could know this reality. The tools that were developed: the scientific method, the utilitarian ethical system, refined logical systems, inductive logic, linguistics, statistics, and the phenomenological method of doing anthropology, history, sociology, and the study of religion, all were expected to bring us closer to an accurate “picture” of how our world really worked. This knowledge would let us become the masters of our fate and do away with chance.1 Christopher Hitchens notes, “The Postmodernist’s tyranny wears people down by boredom and semi-literate prose.”

Gareth Morgan identified eight metaphors of organization in his book Images of Organization. In his late writing Hayek described a theory of spontaneous order, which is brought about because individuals are restrained by certain rules, while the order resulting from their ‘observing these rules’ is wholly beyond their knowledge and intentions. Jürgen Habermas’s theory of social evolution describes the developmental logic for the reproduction of society, social change and the directional character of social change. Darwin’s narrative was that competition favors traits and behavior according to how they affect the success of individuals, not species or other groups. The real reason for regulations is to protect ourselves from excessive competition with one another. Market failures in Adam Smith’s framework occur only when competition is limited. Darwin’s view of the competitive process will prevail over Smith’s in the end because it offers a far more rigorous explanation of the behaviour patterns observed.3

Jürgen Habermas warns of the crisis around the demise of ideals from inept politicians and the dark forces of the market. With respect to postmodernism it implies re-inventing modernity, believing in the possibility and the necessity of social progress. This includes the need to steer social development and to think about the Good Society. As Habermas noticed, the Enlightenment is an unfinished project – we must aspire to a public sphere that serves to make things better. Today “the public” is created at election time by the technicians of public opinion, in order to give a simple endorsement of state power. Instead of criticizing and examining the government, this manipulated public is meant merely to agree. Habermas makes it clear that a successful democracy needs a vibrant, critical public sphere instead of the present fake messaging.4 Such a public sphere creates hope for a future of a political system based on the equal rights and obligations of citizens, and provides a response to postmodern metaphors in economics.

1 Wm. S. Jamison (11 July 2016) The Dilemma of Postmodernism.

2 Hans von Zon (2013) The unholy alliance of neoliberalism and postmodernism.

3 Darwin’s Invisible Hand Narrative: A New Paradigm. (10 April 2018)

4 Structural Transformation of the Public Sphere

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An Analysis of the Circulation of Elites in America

At the turn of the 20th century, Vilfredo Pareto (1848-1923) was attempting to refute the claim that socialism provided a superior solution to economic problems. Pareto became concerned that if liberalism was superior why wasn’t it being generally practiced. This led him from economics to sociology. He observed that 80% of Italy’s land was owned by 20% of the people. He coined the term ‘elite’ in 1902 in his descriptions of these apparent ‘efficiencies’ in society. Pareto believed that elite behaviors reflected patterned distributions of individual psychological characteristics. He developed from his economic work a coherent and insightful general theory of social stratification and mobility. His theory of circulation of elites claimed regime change occurs when one elite replaces another – not when rulers are overthrown from below. The role of ordinary people in such transformation is not that of initiators or principle actors, but as followers of one elite or another.

The ‘elite’ is key to understanding society as a whole – for whatever value this elite incarnated would be reflected in society. Elites do not automatically adjust to fit changing conditions, rather an entrenched, maladaptive elite eventually emerges and tends to cling to power for years. The question is why this apparent failure of elites happened. Pareto’s theory of elite cycles frames a sobering answer. He theorized that over time a distinct psychosocial propensity – manifested by personality traits, mentalities, beliefs and actions – becomes predominant in governing elites. They are no longer able to detect or recognize risks that matter to decision-makers. This renders them, especially their leaders, prone to bias, closure, rigidity and cumulating blunders. A gradual process of decline or degeneration takes hold and leads eventually to a profound crisis during which groups and persons disposed toward the opposite propensity ascend, only to have a lengthy process of decline or degeneration begin anew.

Pareto conceived of elites as ‘governing classes’ – as complex aggregations of powerful political, economic and social groups, the inner leaderships of which are located in governments. In Pareto’s usage, governing elites encompass opposing parties and allies, rotating in and out of government offices and squabbling endlessly over policy matters. But these rotations and squabbles do not alter basic psychosocial propensities and governing styles. Elite members are disposed to combine the two modes of political rule, force and persuasion, but over time they, and especially their leaders, come to rely primarily on one mode, one style of governance. Elites always rule, leading to the domination of a minority over a majority. Not withstanding, there is a continuous decline of the elite, thereby making way for a new elite.

Cycles of elite circulation and degeneration can never be eliminated, Pareto observed. However, the start of a cycle may provide a temporary respite – an interval of renewal and hope – because the influx of new elite groups and leaders supplies needed flexibility, innovation, talent, and vigour. A measure of temporary equilibrium is achieved, and a honeymoon period for the new elite unfolds. But this is bound to be short-lived, because the new elite tends to attribute its predecessor’s downfall to specific errors and stylistic shortcomings, rather than to more general bias and closure, political mediocrities in high positions and inflexible policies. The lesson learned is less the need for elite openness and a ruthlessly honest internal discourse than for a more conciliatory or confrontational posture. Sooner than later, complacency and hubris again take hold, policies become rigid and doctrinaire, vices replace virtues and ill-advised undertakings mount.1

World War II’s technological advances, pent-up consumer savings and upgraded workforces provided the revamped American governing elites with relatively easy tasks of political management during the early postwar period. Intertwined Keynesian and welfare state precepts formed the intellectual umbrella for the 1945 – 1980 cycle. They taught that smooth economic sailing could be assured by employing fiscal stimuli in times of falling demand and that political peace could be purchased through social compacts – in partnership with unions. Republicans grudgingly accepted the limited welfare state constructed by Democrats during the pre-war depression and wartime years. After a rash of spending during the Vietnam War, there was not enough gold to cover the amount of dollars in circulation. In response the Nixon administration pulled the US out of the Bretton Woods Accord – abandoning the Gold Standard. In addition, countries led by the US, expanded their money supplies concerned that currency values would fluctuate unpredictably for a time. This in turn, led to the depreciation of the dollar and other currencies, followed directly by massive inflation and recession.

In 1980s, a new elite, the Reagan administration, introduced minimal government and deregulation. The elites’ inner cores consisted of tough-minded leaders and trusted advisors who viewed deregulated markets, reduced interest rates, lower taxes, and trimmed welfare programs as essential for economic growth. Important for the longer run, the Reagan and George H.W. Bush administrations implemented measures enabling homebuyers to obtain mortgages without substantial equity down payments, thus planting the seeds of what eventually became a gigantic housing bubble and a precipitous decline in consumer savings. When these panaceas had costly consequences, as in US bailouts of S&Ls and Long Term Capital, and when large corporations such as Enron, Global Crossing, and WorldCom went bankrupt a short time later, they were treated as instances of mismanagement, not harbingers of crisis. The blithe attitude of the governing elites about these developments was encapsulated by Vice President Dick Cheney’s flip remark, ‘Reagan proved deficits don’t matter.’

In November 2008, voters in the US were reacting to a shattering economic crisis – a failure of the governing elites – defined by the biggest decline in consumption and investment since the Great Depression. John McCain faced an impossible task that election. However, there was little change as President Obama’s election resulted in one elite being replaced with another with similar thinking. Obama signed The Recovery and Reinvestment Act – the boldest counter cyclical fiscal stimulus in American history. It included $787 billion of tax cuts and spending, with the total split roughly one-third tax cuts, one-third government investments, and one-third aid to the people most directly harmed by the recession and to troubled state and local governments. Despite Obama’s public posture has always been that he resents the political influence of special interests and financial elites, he was quite comfortable with appointing bankers to key positions in his government.

According to Pareto, circulation or upward and downward circulation amongst the members of elite and non-elite is a typical characteristic of the elite. Social change occurs with individuals circulating between the elite and the non-elite. This replacement takes place in two ways: either by gradual process of infiltration, or by complete change of the guard. During the 2016 Democratic primaries there was an opportunity for sudden change in one of the major governing elites in America. These potential changes outlined from Bernie Sanders platform include: a new federal minimum wage of $15 per hour, significant plans for an infrastructure bank to lead the renewal of the US’ roads, railways, ports and bridges, to higher taxes on the 0.1% of top income earners, to a public option for healthcare cost reduction, to environmental protection, to greater intra-party democracy. Bernie Sanders remains an important progressive voice in the Democratic Party.2

The elite manipulate overtly or covertly the political power. Donald Trump’s election is an illustration. Following Machiavellian formula of power, Pareto observes elites are able to manipulate and control the masses by resorting to two methods. First, elites adopt flexibility to environmental and situational exigencies. This group prefers materialistic to idealistic goals, but lack fidelity and principles, and use strategies that vary from emotional appeal to unadulterated fraud. The second method encompasses the conservative elite, bound by faith and ideology, who display group loyalty and class solidarity. Today’s Republican Party is an amalgamation of both methods of manipulation and control. The members of an elite will always try to ensure that the non-elites should not influence social, economic and political processes in any way. The present Republican Party, under the control of faith groups and autocracy, is closed to circulation from non-elites. In a perfectly free society there would be constant and free circulation of elites.

In 2018, there is an opportunity for the non-elites to circulate amongst members of the elite. It is presently restricted to the Democratic Party, and the primaries allow these individuals an opportunity to participate. The rate of social change in the US will depend on these non-elites – many who are women embracing many of the progressive ideas espoused by Bernie Sanders – being successfully elected in November. The task is to reverse the decline of democracy. With the moral degradation of the present political governing elites; the lack of virtuous men in power positions, now politics is not a profession, but a profitable part-time job for some seeking to promote and attain certain private advantage. “By the circulation of elites,“ Pareto wrote, “the governing elite is in a state of continuous and slow transformation. It flows like a river, and what it is today is different from what it was yesterday.”

1 John Higley and Jan Pakulski Pareto’s Theory of Elite Cycles: A Reconsideration and Application

2 Inderjeet Parmar (24 Aug 2016) America’s New Normal is Threatening the ‘Naturalness’ of Elite Rule

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The Rise of the Kleptocracy: America’s Security Threat

Milton Friedman’s neoliberal triumvirate of privatization, deregulation – free trade, and drastic cuts to government spending laid the groundwork for Reagan economic policies of deregulation that began in the 1980s. This, in turn, launched globalization which was supposed to undermine authoritarianism. It was believed that the openness of the new century generated an advantage for emerging middle classes, on-line dissidents, NGOs and democratic movements. The lobbying profession exploded, and industries began writing legislation affecting their sectors; public services such as incarceration and war fighting were privatized; the brakes on money in politics were released; and presidents began filling top regulatory positions with bankers. Since the 1970s the technology of moving money around has changed radically, as both technological and political changes dovetailed. The dismantling of capital controls and the creation of global capital markets, tied together with instantaneous money transfer and effective free movement for the mass affluent, has created an environment highly suited to kleptocracy.

This rapid deregulation has made wealth easier both to hide and defend. Since the 1970s the complex of lawyers, bankers, lobbyists, accountants, and public relations experts – the ‘wealth services industry’ – have matured in power and skill. Not only has it successfully defended its clients from taxation, it has created new legal tools for them to avoid it: for example, the ability to keep cash owned by foreign subsidiaries in U.S. banks, untaxed but controlled in all but name by the U.S. parent company. At the same time, the wealth defense industry enables an escalation of offshore tax avoidance: consider the 30 major U.S. corporations which, between 2008 and 2010, collectively paid more in lobbying fees related to promoting tax avoidance measures in Congress than they did in federal income taxes. The wealth services industry has evolved from more or less defending Western clients into a global concern whose kleptocracy clientele now includes Russian, Chinese, Central Asian, and Gulf autocrats.

The World Bank has shown how frighteningly easy it is to launder money with complete anonymity. Under international guidelines, incorporation agents are supposed to establish the identity of a beneficial owner. The purpose of this requirement is to prevent the ability of criminals to launder funds through the system, though in reality this flimsy stipulation has broken down in the contemporary offshore environment. A recent World Bank study found that 42 out of 102 incorporation agents surveyed failed to establish the identities of their clients. This finding was further corroborated by the Global Shell Games project, an academic research project that posed as 21 aliases mimicking everything from terrorists to corrupt officials and contacted nearly 4,000 incorporation agents worldwide. This project revealed that one quarter of these agents were ready to create a shell company without any documentation, and half were ready to do so without meeting the requirements of the law.1

The key element in maintaining the kleptocracy is the anonymous or “shell” company, a company stripped to its legal essence that provides neither goods nor services. Shell companies are used to hold funds and conceal their owners’ identities. Rather than be misled by the designation of “company,” it is best to conceptualize these entities as something closer to secret codes. Shell companies are often mathematically generated legal formulas, a chain of interlocking companies and holding companies, created simply for the benefit of anonymity. This is, of course, exactly what a criminal or kleptocrat needs in order to avoid detection in either his own country or the West. Once established, these shell companies can freely acquire assets across the West with anonymity. Russian, Chinese, Central Asian, and Gulf ruling classes have shown a marked preference for laundering their wealth into prime real estate assets in Western capitals through these same anonymity devices.

Why is anonymity so important? This is the successful criminal’s dilemma. Once you are successfully stealing, your problem becomes not simply the ability to steal more, but the ability to launder these ill-gotten gains effectively. The successful criminal is accumulating dirty black cash that he cannot easily use or secure and needs to convert it into clean white cash: this is why money laundering is so important. The easier it is to launder money, the richer, more powerful, and more influential criminals become, and the quicker it becomes for the proceeds of crime to turn into new sources of power and activity. This is why nothing is more beautiful for a corrupt dictator than the ability to anonymously and untraceably move enormous sums electronically around the world. This empowers him, both at home and abroad. Gigantic sums of money are now travelling the world incognito. This dirty money is undermining democracy, weakening capitalism, and threatening security – both in America and abroad.

Globalization has created the golden age of money laundering and the rise of kleptocracy. Nestling in Western economies are offshore financial structures (and their professional enablers) which allow funds to instantaneously and anonymously jump between countries, empowering authoritarians and corrupting Western institutions. The International Monetary Fund estimates up to 5 percent of the world’s GDP is laundered money – and only 1 percent of it ever gets spotted. It has never been simpler or safer to be a kleptocrat. Globalization’s deep, structural motors are in fact enabling authoritarians. Not only can capital now mask itself and disappear without any trace, but gigantic sums of money are now traveling the world in a concealed manner. This is why the closest places to see the results of the looting are not in Africa or Central Asia but in downtown Manhattan and central London, where hundreds of “ghost apartments” now sit empty. Their primary function is no longer as residences, but as deposit boxes for illicit, laundered wealth.1

Globalization apologists optimistically predicted opportunities for peace, prosperity, and freedom would be created. Rather than retreat, democratize, and reform towards the rule of law, the autocratic ruling classes of Russia, China, Central Asia, the Arabian Gulf, and beyond have globalized with great success. The openness of the new century, the U.S. and the EU are now finding, is in fact rather well suited to the kleptocracy behind a dictator – with a coterie of American lawyers, French bankers, German accountants, and British public relations teams in tow. When a kleptocrat seeks to secure his illicitly gained and vulnerable assets, he is enabled at every step by Western bankers, lawyers, accountants, and other professionals. Recent corruption scandals have shown that major financial institutions such as HSBC, Deutsche Bank, UBS, and BNP Paribas have all participated in such money transfers. This has significantly altered the psychological perception and relationship between authoritarian and Western elites.1

Authoritarian conduct is now shaped by the ease and ability to move both their money and their persons easily offshore and into the Western world. The modus operandi of the contemporary authoritarian kleptocratic is: steal in a zone without the rule of law, and then secure it in a state with the rule of law. This changes the psychology of contemporary authoritarians. They have much less to lose if they lose power, so they can rule more avariciously and engage in much less state building when in office. This mechanism behind kleptocracy has been clear to Western bankers, lawyers, accountants, and public relations specialists for over a decade. Globalization has made it easier for corrupt officials to sequester their assets abroad. The White House, still with one foot in the Kennan paradigm, has been slower to catch on. The Robert Mueller investigation includes probing how offshore financial structures allow economic elite to corrupt American institutions and politics.

On the night of February 22, 1946, a young U.S. diplomat named George Kennan, then based in Moscow, sent a famous telegram outlining what he saw as a gathering conflict with the Soviet Union. In embryonic form, that telegram prefigured a strategy Kennan would later term “containment”: a “long-term, patient but firm and vigilant” resistance to Soviet expansion. The telegram was about Soviet behavior after their threats on Poland in 1945, and especially with regards to their refusal to join the newly created World Bank and International Monetary Fund. As the Western financial system became hospitable to authoritarian elites, powerful players from authoritarian regimes have taken advantage of offshore anonymity to amass fortunes worth billions of dollars with the aid of western enablers. Today the Kremlin uses the methods and connections of the Russian kleptocracy, and the power and influence they generate, to advance its agenda abroad.

Though unanticipated, the growth of opaque financial systems has become one of the key features of globalization: enormous amounts of money are now moving around the world covertly. Kleptocratic regimes not only are able to wield power inside Western institutions and game them to their own ends, but also use their financial heft to project influence on international media and events. These processes include undermining American foreign policy: crippling development, threatening democracy, damaging Western soft power, and fuelling state collapses. The response requires a new paradigm to replace the Cold War paradigm. These forces have become a multifaceted threat to democracy that requires a coordinated and sophisticated transnational response. It is necessary to shut down the corrupt wealth services industry involved in laundering money for clientele that includes Russian, Chinese, Central Asian, and Gulf aristocrats. Ending the anonymous shell companies must become a national security priority for the US.

1 Judah, Ben. October, 2016. Kleptocracy Initiative of the Hudson Institute. The Kleptocracy Curse: Rethinking Containment

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