The Vast Left-Wing Conspiracy

(((Michele Bachmann is either completely certifiable or utterly cynical; intimations -- but not accusations! not at all! -- of sinister Dem plots to poison the US with swine flu.)))

This is hilarious, mainly because it seems right out of a segment of the Colbert Report: Minnesota Republican representative Michele Bachmann remarked on the "coincidence" that the last swine flu outbreak in the US also occurred in a Democratic administration.

Except, of course, that it didn't. It was the Ford administration (which the linked AP article helpfully notes).

So either she believes that all those Democrats are, as she called them to Chris Matthews, un-American, and so out to get America, to the point where she misremembers things so that they fit this twisted view of her political opponents, or she makes it up because she knows it gets her fans and she doesn't care that it's not true. Either way, it is Bad.

And for what it's worth, it's never occurred to me that someone like George Bush or Karl Rove hates America. They love it. It's just that most of what they love about it is what I hate about it.

Activist Judges Threaten CEO Compensation

(((Richard Posner as "activist judge;" the market is structurally incapable of setting CEO compensation and mutual fund fees; and this according to none other than Posner.)))

Eliot Spitzer (srsly?) has a piece in Slate examining Chicago School free-marketeer Richard Posner's comments in a recent decision:

In an opinion dissenting from the "denial of rehearing en banc"—a sequence of words only a lawyer could love—Posner wrote that there are growing indications that CEO compensation "is excessive because of the feeble incentives of board of directors to police compensation. … Directors are often CEOs of other companies and naturally think that CEOs should be well paid. And often they are picked by the CEO." He then examined the conflicts inherent in the process of CEO compensation determination, concluding that "[c]ompetition ... can't be counted on to solve the problem because the same structure of incentives operates on all large corporations and similar entities, including mutual funds" [emphasis added]. [ . . . ]

In other words, there is precisely no check within the market, because the people deciding how much the CEO should make are the same people who stand to gain if CEOs are highly valued, or -- dare I say it? -- overvalued.

Spitzer continues:

Posner concluded that while judges shouldn't directly review corporate salaries, evidence of unreasonable compensation could be evidence of a breach of fiduciary duty. Yes, these are legal words, but they reveal a remarkable conclusion—courts should take a hard look at private-compensation issues—and demonstrate how far, and rapidly, the world has shifted.

So in other words, the solution is for courts to keep an eye on the situation and to consider compensation and fees in the context of, or as aspects of, the fiduciary duties of governing boards. So here come the activist judges once again threatening the American way of life, at least, if that's understood as the right to marry only someone of the opposite sex, or the right to make as much money as you can legally convince someone to pay you.

Isn't it ironic, though, that the activist judge in this case is Judge Posner? It sounds so Adam Smith, so old school capitalist, so . . . moral. So much of the socialist objection to capitalism is the tendency to socialize costs while privatizing profits (see the bailout), but here's Posner acknowledging that it's not all about how much money you can make.

The Wikipedia page on the Chicago School quotes this interesting little snippet from Posner: "[the central] meaning of justice, perhaps the most common is – efficiency… [because] in a world of scarce resources waste should be regarded as immoral." We don't have to agree with this conception of justice to see that, in its terms, CEO compensation and mutual fund fees have become essentially wasteful and, hence, immoral. And that the inability of the market to account for this means that the market is, to that extent, inefficient and, well, yeah: immoral.

The Red(coat)s are Coming!

(((More accusations of "socialism;" if you don't actually say who you mean, you don't have to explain why your use of the term is accurate or appropriate, or maybe not even what you mean by it.)))

Politico.com has a note on Spencer Bachus' ominous hinting that the Soviet Union left behind plants in the US Congress to turn us commie long after the Old Girl bit the dust. They were so clever that way.

Unfortunately, Politico actually takes this somewhat seriously.

“Socialism” is one of the more elastic nouns in the political lexicon. In the broadest sense, it defines a system that provides for state ownership of some private industries and governmental commitments to providing direct housing, health care, education and income supports.

To many on the left, it’s a relatively benign — if outdated — term, representing an activist, interventionist government that prioritizes economic security over the unfettered freedom of the marketplace.

To many on the right, it’s practically an epithet — suggesting a return to Soviet-style Communism or a leap toward a hyper-regulated European brand of capitalism that stifles innovation and hikes taxes.

But this is already to cede too much ground to Bachus's rationality and integrity. It's not "practically an epithet;" it is an epithet. Calling someone a socialist in the US is roughly equivalent to standing up in church and saying that some people sitting in nearby pews worship the devil; or in this case, like someone in the choir saying there are some unnamed choir members who worship the devil. Everyone agrees devil worship is bad, or at least no one is going to go standing up for the devil, so instead of defending devil worship, everyone trips over themselves to prove they don't worship the devil. The accusation is already the damning evidence, so the burden of proof is on the accused.

Enter the godless [sic] commie.

But socialism is not devil worship. Unless maybe poverty, unemployment, illness, and the desire for a meaningful life outside of wage slavery are sins. In that case, sign me up with whoever calls bullshit.

Anyway, I don't think Bachus pulled that number out of his behind. I expect him to name his names. That's why he came out with a number. He knows who he's prepared to make some kind of case about. So let's have 'em.

Bridge Metaphor to Nowhere

((("Bridge to nowhere;" auto industry bail-out; Washington "pork" spending; tiresome spin masquerading as cleverness.)))

Am I really the only one who is sick to death of hearing spin-meisters on TV calling the auto industry loan the "bridge loan to nowhere"? How about "bridge loan to stabilized unemployment"? Or "bridge loan to an economy not in the tank"?

Never mind whether the loan is a good idea. Never mind if it's throwing good money after bad. Can someone please just stop the insanity of the metaphor slicer-dicer to nowhere (with Scandinavian snowball earrings yours to keep if you can stop it right now)? Or clean up this metaphorical spill with the sham-wow of political discourse?

Please?

Michael Perelman on the Bubble and the Bailout

(((Nice rant; physicists can't make something out of nothing, but financial whiz-kids keep trying, and the rest of us pay when they fail; all that is solid melts into air.)))

Michael Perelman has a great, succinct rant on the sorry, avoidable mess we're in.

Skilled physicists do not know how to take nothing and turn it into matter and antimatter, but finance behaves as if it had the capacity to do something similar. Imagine a simple market economy about to create a bubble. I want to tell the story of this bubble, only to put the current, crazy stimulus package into perspective.

Somebody says to me they have a piece of paper worth $1 million. I can buy for half the price. I borrow the money to cover most of the cost. People are willing to lend me the money confident in the belief that my paper will increase in value. Other people are engaging in the same transaction, spreading confidence that these papers are now increasing in value, say to $600,000.

The seller of the paper now has a half-million dollars, having given up nothing but blank piece of paper. I have a capital gain of hundred thousand dollars. My lenders have a credit with a half-million dollars. We are all better off, even though nothing has been produced. [snip]

At some point, people realize that this paper is nothing more than a blank sheet of writing paper. The bubble may have stimulated some investment that is capable of producing real economic benefits, but mostly it has induced people to consume and commit themselves to pay back debts.

Credit Democracy

(((Not universal healthcare, but universal credit; except when you marry your dream girl and you didn't know her credit was bad; relationship between credit, democracy, and housing, especially housing bubbles; credit is not the way to provide housing.)))

Ross McKibbin in the LRB. Aspects are quite specific to Britain, but some fundamental observations are not.

The second inescapable obligation is the return of housing to its proper function: as providing places to live in rather than to speculate on. The relationship of housing to politics in both Britain and the United States is not fully understood even by those who transformed it. They don’t understand it because that would require confronting awkward facts about Anglo-American democracy. Fundamentally, private housing has become a compensation for the increasingly gross maldistribution of income. Inadequate incomes mean that large numbers of people don’t have access to the style of life that has always been the ultimate justification of neoliberalism and to which, reasonably enough, they now believe they have a right. What does give them access to it (in the short term) is credit. But credit has to be secured, and that’s what housing does. However, it works only if house prices keep rising and people have enough income to repay debt. When prices stop going up and people can no longer repay what they owe, the financial system begins to disintegrate. This is what has happened; and it has happened because we have replaced something like social democracy with credit democracy, or universal access to credit, and credit is a thoroughly inadequate substitute because sooner or later it has to be repaid. Which means that people’s incomes have to be sufficient to repay it, and in many cases they aren’t. What we have put in place is a dynamically destructive cycle. The number of houses is rationed in order to force up prices [this ir related to a specific Tory policy]; people buy houses in order to secure credit on the strength of those prices; this encourages a heady belief in perpetual profit and thus both risky lending and risky borrowing; this renders the banking system unstable; and lending both to individuals and among banks then collapses. Such a cycle involves a paradox. Since these credit democracies still hold elections, governments are forced to underwrite savers at the expense of creditors and stockholders. And if savers are also small shareholders, as many are, the price they pay for protecting their deposits is the devaluation of their shares. This is absolutely not what was originally intended. The rationing of house building has one other consequence: it means that many cannot acquire somewhere adequate to live.

There Is Only One World

(((Alain Badiou on what it means to be communist today, the necessity for courage, a distillation of a communist "hypothesis" in the form less of a manifesto proper (communism already has one) but maybe a sort of post-manifesto?, communism is not properly speaking utopian (or religious for that matter :-))))

From a Badiou essay mainly about Sarkozy in the New Left Review:

What is the communist hypothesis? In its generic sense, given in its canonic Manifesto, ‘communist’ means, first, that the logic of class—the fundamental subordination of labour to a dominant class, the arrangement that has persisted since Antiquity—is not inevitable; it can be overcome. The communist hypothesis is that a different collective organization is practicable, one that will eliminate the inequality of wealth and even the division of labour. The private appropriation of massive fortunes and their transmission by inheritance will disappear. The existence of a coercive state, separate from civil society, will no longer appear a necessity: a long process of reorganization based on a free association of producers will see it withering away.

‘Communism’ as such denotes only this very general set of intellectual representations. It is what Kant called an Idea, with a regulatory function, rather than a programme. It is foolish to call such communist principles utopian; in the sense that I have defined them here they are intellectual patterns, always actualized in a different fashion. As a pure Idea of equality, the communist hypothesis has no doubt existed since the beginnings of the state.

Note that "state" is used here in a historically specified sense, but understood this way, communism is surely an essentially contra-statist idea, a reaction to (and against) the state-formation as a mechanism of oppression and repression, which it can hardly not be, to greater or lesser degrees. Of course, communism has become bound up with statism even more than Nazism (an expressly statist ideology), for reasons that require no explanation. The question before is us how to proceed in the world as communists while leaving behind (we might say, negating, in that technical sense of Badiou's) the statist/party politics of the 20th century. That's the challenge, and it is of course both a theoretical and a practical challenge, a universal and a local challenge (how can it possibly be one and not at the same time the other?). So what we set ourselves is not the proverbial ideologue's task (to figure out what is wrong with the world while maintaining our theory), but the goal of rethinking the theory and the practice together. Again, what does it mean to do anything else? What we DO maintain is the idea, the hypothesis, that another world is possible; indeed, that one world is possible.

The (19th-century) movement and the (20th-century) party were specific modes of the communist hypothesis; it is no longer possible to return to them. Instead, after the negative experiences of the ‘socialist’ states and the ambiguous lessons of the Cultural Revolution and May 68, our task is to bring the communist hypothesis into existence in another mode, to help it emerge within new forms of political experience. This is why our work is so complicated, so experimental. We must focus on its conditions of existence, rather than just improving its methods. We need to re-install the communist hypothesis—the proposition that the subordination of labour to the dominant class is not inevitable—within the ideological sphere.

What might this involve? Experimentally, we might conceive of finding a point that would stand outside the temporality of the dominant order and what Lacan once called ‘the service of wealth’. Any point, so long as it is in formal opposition to such service, and offers the discipline of a universal truth. One such might be the declaration: ‘There is only one world’. What would this imply? Contemporary capitalism boasts, of course, that it has created a global order; its opponents too speak of ‘alter-globalization’. Essentially, they propose a definition of politics as a practical means of moving from the world as it is to the world as we would wish it to be. But does a single world of human subjects exist? The ‘one world’ of globalization is solely one of things—objects for sale—and monetary signs: the world market as foreseen by Marx. The overwhelming majority of the population have at best restricted access to this world. They are locked out, often literally so.

The fall of the Berlin Wall was supposed to signal the advent of the single world of freedom and democracy. Twenty years later, it is clear that the world’s wall has simply shifted: instead of separating East and West it now divides the rich capitalist North from the poor and devastated South. New walls are being constructed all over the world: between Palestinians and Israelis, between Mexico and the United States, between Africa and the Spanish enclaves, between the pleasures of wealth and the desires of the poor, whether they be peasants in villages or urban dwellers in favelas, banlieues, estates, hostels, squats and shantytowns. The price of the supposedly unified world of capital is the brutal division of human existence into regions separated by police dogs, bureaucratic controls, naval patrols, barbed wire and expulsions. The ‘problem of immigration’ is, in reality, the fact that the conditions faced by workers from other countries provide living proof that—in human terms—the ‘unified world’ of globalization is a sham.

We maintain the idea of one world against a contradictory capitalist idea of division deserved and unification deferred. Capitalism, liberalism, insists that it is the best way to achieve the goal of one world, despite all the evidence to the contrary, but also despite a hypothesis that insists that such class divisions as there are, are the fault of the world—lazy people who don't work hard enough or at all, for example, and so do not deserve to live in the upper classes, if they deserve to live at all—and at the very same time the very meting out of justice according to the hypothesis. Extraordinarily, capitalism (usually, I think, by means of economic growth) is both supposed to spread the wealth to everyone and at the same time (by means of its meritocratic logic) to redistribute wealth from the undeserving (the sign of whose moral bankruptcy is their very poverty) to the deserving (the sign of whose moral superiority is their very wealth).

In its compassionate, liberal moments, it recognizes the falsity of that claim, but insists instead that, in Thatcher's words, there is no alternative, or at least no democratic alternative, no alternative compatible with the idea of the individual. But I've run out of the steam right now to respond to that. So go read the essay. Maybe, probably, I will take it up soon. But surely we can understand that the constitution of identity under capitalism is woefully underformed and binds us each to our several worlds, worlds in which our identity is often already constituted for us, but that even when we participate, we do so in the only way we can in a world of competing worlds: we pick a world.