Tag Archives: capitalism

Business, Idea Soup

Hedging With Death

Wiertz-burial

I’ve never met a hedge fund guy. I don’t think I ever will. They’re invariably male and white. Hedge fund guys move in very different circles than mere mortgage-bound morals like me, usually orbited by billions of dollars and extravagant toys like 200 ft yachts, Tuscan palazzos and a Lamborghini on every continent. At least that’s the popular stereotype.

I’m not sure I like the idea of hedge funds and hedge fund guys with their complex and obfuscated financial transactions, nano-second trading, risk shifting strategies, corporate raids and restructurings. I’m not against gazillionaires per se — but I much prefer the billionaires who invent and make things over those who simply bet and gamble and destroy.

So, it comes as no surprise to learn that one predatory hedge fund guy has found a way to make money from the death of strangers. His name is Donald F. “Jay” Lathen Jr. and his hedge fund is known as Eden Arc Capital Management. Lathen found a neat way for his hedge fund to profit from bonds and CDs (certificates of deposit) with survivor options. For each of his “death transactions” there would be two named survivors: himself or an associate and a terminally-ill patient at a nursing home or hospice. In exchange for naming Lathen as a financial beneficiary the patient would collect $10,000 from Lathen. Lathen would then rake in far greater sums from the redeemed bonds when the patient died.

Lathen’s trick was to enter into such deals only with patients that he calculated to be closest to death. Nothing illegal here, but certainly ethically head-scratching. Don’t you just love capitalism!

From Bloomberg:

A vital function of the financial system is to shift risk, but that is mostly a euphemism. Finance can’t make risks go away, or even really move them all that much. When the financial system shifts the risk of X happening from Y to Z, all that means is that Z gives Y money if X happens. If X was going to happen to Y, it’s still going to happen to Y. But now Y gets money.

Death is a central fact of human existence, the fundamental datum that gives meaning to life, but it is also a risk — you never know when it will happen! — and so the financial industry has figured out ways to shift it. Not in any supernatural sense, I mean, but in the regular financial-industry sense: by giving people money when death happens to them. One cannot know for certain how much of a consolation that is.

Another vital function of the financial system is to brutally punish the mispricing of risk through arbitrage. Actually I don’t really know how vital that one is, but people are pretty into it. If someone under- or overestimates a risk, someone else will find a way to make them pay for it. That’s how markets, even the market for death, stay efficient.

The normal way to shift the risk of death is life insurance — you die, the insurance company gives you money — but there are other, more esoteric versions, and they are more susceptible to arbitrage. One version involves “medium and long-term bonds and certificates of deposit (‘CDs’) that contain ‘survivor options’ or ‘death puts.'” Schematically, the idea is that a financial institution issues a bond that pays back $100 when it matures in 2040 or whatever. But if the buyer of the bond dies, he gets his $100 back immediately, instead of having to wait until 2040. He’s still dead, though.

But the bond can be owned jointly by two people, and when one of them dies, the other one gets the $100 back. If you and your friend buy a bond like that for $80, and then your friend dies, you make a quick $20.

But what are the odds of that? “Pretty low” was presumably the thinking of the companies issuing these bonds. But they didn’t reckon with Donald F. “Jay” Lathen Jr. and his hedge fund Eden Arc Capital Management:

Using contacts at nursing homes and hospices to identify patients that had a prognosis of less than six months left to live, and conducting due diligence into the patients’ medical condition, Lathen found Participants he could use to execute the Fund’s strategy. In return for agreeing to become a joint owner on an account with Lathen and/or another individual, the Participants were promised a fixed fee—typically, $10,000.

That is, needless to say, from the Securities and Exchange Commission administrative action against Lathen and Eden Arc. Lathen and a terminally ill patient would buy survivor-option bonds in a joint account, using Eden Arc’s money; the patient would die, Lathen would redeem the bonds, and Eden Arc would get the money. You are … somehow … not supposed to do this?

Read the entire story here.

Image: Antoine Wiertz’s painting of a man buried alive, 1854. Courtesy: Wiertz Museum, Netherlands / Wikipedia. Public Domain.

tD

The American Dream: Socialism for the Rich Or Capitalism For All?

You know that something’s up when the Wall Street Journal begins running op-ed columns that question capitalism. Has even the WSJ now realized that American capitalism thrives by two sets of rules: one for the rich socialists, the crony capitalists who manipulate markets (and politics), invent loopholes, skirt regulation, and place enormous bets with others’ wealth; the other, for the poor capitalists, who innovate, work hard and create tangible value.

Now even Bill Gates — the world’s richest citizen — tells us that only socialism can address climate change! It’s clear that the continued appeal of Bernie Sanders to those on the political left, and the likes of Ben Carson and that-other-guy-with-the-strange-hair-and-big-mouth-and-even-bigger-ego to those on the right, highlights significant public distaste for our societal inequality and political morass. At times I feel as if I’ve been transported to a parallel universe, a la 1Q84, where the 99 percent will rise and finally realize meaningful change through social and economic justice. Can it really happen?

Nah! It’ll never happen. The tentacles that connect politicians and their donors are too intertwined; the pathways that connect the billionaires, oligarchs, plutocrats and corporations to lobbyists to regulators to lawmakers are too well-protected, too ingrained. Until these links are broken the rich will continue to get richer and the poor will continue to dream. So, for the time being remember: the rich are just too big to fail.

From the WSJ:

If you want to find people who still believe in “the American dream”—the magnetic idea that anyone can build a better life for themselves and their families, regardless of circumstance—you might be best advised to travel to Mumbai. Half of the Indians in a recent poll agreed that “the next generation will probably be richer, safer and healthier than the last.”

The Indians are the most sanguine of the more than 1,000 adults in each of seven nations surveyed in early September by the market-research firm YouGov for the London-based Legatum Institute (with which I am affiliated). The percentage of optimists drops to 42 in Thailand, 39 in Indonesia, 29 in Brazil, 19 in the U.K. and 15 in Germany. But it isn’t old-world Britain or Germany that is gloomiest about the future. It is new-world America, where only 14% of those surveyed think that life will be better for their children, and 52% disagree.

The trajectory of the world doesn’t justify this pessimism. People are living longer on every continent. They’re doing less arduous, backbreaking work. Natural disasters are killing fewer people. Fewer crops are failing. Some 100,000 people are being lifted out of poverty every day, according to World Bank data.

Life is also getting better in the U.S., on multiple measures, but the survey found that 55% of Americans think the “rich get richer” and the “poor get poorer” under capitalism. Sixty-five percent agree that most big businesses have “dodged taxes, damaged the environment or bought special favors from politicians,” and 58% want restrictions on the import of manufactured goods.

…

Friends of capitalism cannot be complacent, however. The findings of the survey underline the extent to which people think that wealth creation is a dirty business. When big majorities in so many major nations think that big corporations behave unethically and even illegally, it is a system that is always vulnerable to attack from populist politicians.

John Mackey, the CEO of Whole Foods, has long worried about the sustainability of the free enterprise system if large numbers of voters come to think of businesses as “basically a bunch of psychopaths running around trying to line their own pockets.” If the public doesn’t think business is fundamentally good, he has argued, then business is inviting destructive regulation. If, by contrast, business shows responsibility to all its stakeholders—customers, employees, investors, suppliers and the wider community—“the impulse to regulate and control would be lessened.”

Read the entire column here.

Art, Environs, Idea Soup

Can Burning Man Be Saved?

Burning-Man-2015-gallery

I thought it rather appropriate to revisit Burning Man one day after Guy Fawkes Day in the UK. I must say that Burning Man has grown into more of a corporate event compared with the cheesy pyrotechnic festivities in Britain on the 5th of November. So, even though Burners have a bigger, bolder, brasher event please remember-remember, we Brits had the original burning man — by 380 years.

The once-counter-cultural phenomenon known as Burning Man seems to be maturing into an executive-level tech-fest. Let’s face it, if I can read about the festival in the mainstream media it can’t be as revolutionary as it once set out to be. Though, the founders‘ desire to keep the festival radically inclusive means that organizers can’t turn away those who may end up razing Burning Man to the ground due to corporate excess. VCs and the tech elite from Silicon Valley now descend in their hoards, having firmly placed Burning Man on their app-party circuit. Until recently, Burners mingled relatively freely throughout the week-long temporary metropolis in the Nevada desert; now, the nouveau riche arrive on private jets and “camp” in exclusive wagon-circles of luxury RVs catered to by corporate chefs and personal costume designers. It certainly seems like some of Larry Harvey’s 10 Principles delineating Burning Man’s cultural ethos are on shaky ground. Oh well, capitalism ruins another great idea! But, go once before you die.

From NYT:

There are two disciplines in which Silicon Valley entrepreneurs excel above almost everyone else. The first is making exorbitant amounts of money. The second is pretending they don’t care about that money.

To understand this, let’s enter into evidence Exhibit A: the annual Burning Man festival in Black Rock City, Nev.

If you have never been to Burning Man, your perception is likely this: a white-hot desert filled with 50,000 stoned, half-naked hippies doing sun salutations while techno music thumps through the air.

A few years ago, this assumption would have been mostly correct. But now things are a little different. Over the last two years, Burning Man, which this year runs from Aug. 25 to Sept. 1, has been the annual getaway for a new crop of millionaire and billionaire technology moguls, many of whom are one-upping one another in a secret game of I-can-spend-more-money-than-you-can and, some say, ruining it for everyone else.

Some of the biggest names in technology have been making the pilgrimage to the desert for years, happily blending in unnoticed. These include Larry Page and Sergey Brin, the Google founders, and Jeff Bezos, chief executive of Amazon. But now a new set of younger rich techies are heading east, including Mark Zuckerberg of Facebook, employees from Twitter, Zynga and Uber, and a slew of khaki-wearing venture capitalists.

Before I explain just how ridiculous the spending habits of these baby billionaires have become, let’s go over the rules of Burning Man: You bring your own place to sleep (often a tent), food to eat (often ramen noodles) and the strangest clothing possible for the week (often not much). There is no Internet or cell reception. While drugs are technically illegal, they are easier to find than candy on Halloween. And as for money, with the exception of coffee and ice, you cannot buy anything at the festival. Selling things to people is also a strict no-no. Instead, Burners (as they are called) simply give things away. What’s yours is mine. And that often means everything from a meal to saliva.

In recent years, the competition for who in the tech world could outdo who evolved from a need for more luxurious sleeping quarters. People went from spending the night in tents, to renting R.V.s, to building actual structures.

“We used to have R.V.s and precooked meals,” said a man who attends Burning Man with a group of Silicon Valley entrepreneurs. (He asked not to be named so as not to jeopardize those relationships.) “Now, we have the craziest chefs in the world and people who build yurts for us that have beds and air-conditioning.” He added with a sense of amazement, “Yes, air-conditioning in the middle of the desert!”

His camp includes about 100 people from the Valley and Hollywood start-ups, as well as several venture capital firms. And while dues for most non-tech camps run about $300 a person, he said his camp’s fees this year were $25,000 a person. A few people, mostly female models flown in from New York, get to go free, but when all is told, the weekend accommodations will collectively cost the partygoers over $2 million.

This is drastically different from the way most people experience the event. When I attended Burning Man a few years ago, we slept in tents and a U-Haul moving van. We lived on cereal and beef jerky for a week. And while Burning Man was one of the best experiences of my life, using the public Porta-Potty toilets was certainly one of the most revolting experiences thus far. But that’s what makes Burning Man so great: at least you’re all experiencing those gross toilets together.

That is, until recently. Now the rich are spending thousands of dollars to get their own luxury restroom trailers, just like those used on movie sets.

“Anyone who has been going to Burning Man for the last five years is now seeing things on a level of expense or flash that didn’t exist before,” said Brian Doherty, author of the book “This Is Burning Man.” “It does have this feeling that, ‘Oh, look, the rich people have moved into my neighborhood.’ It’s gentrifying.”

For those with even more money to squander, there are camps that come with “Sherpas,” who are essentially paid help.

Tyler Hanson, who started going to Burning Man in 1995, decided a couple of years ago to try working as a paid Sherpa at one of these luxury camps. He described the experience this way: Lavish R.V.s are driven in and connected together to create a private forted area, ensuring that no outsiders can get in. The rich are flown in on private planes, then picked up at the Burning Man airport, driven to their camp and served like kings and queens for a week. (Their meals are prepared by teams of chefs, which can include sushi, lobster boils and steak tartare — yes, in the middle of 110-degree heat.)

“Your food, your drugs, your costumes are all handled for you, so all you have to do is show up,” Mr. Hanson said. “In the camp where I was working, there were about 30 Sherpas for 12 attendees.”

Mr. Hanson said he won’t be going back to Burning Man anytime soon. The Sherpas, the money, the blockaded camps and the tech elite were too much for him. “The tech start-ups now go to Burning Man and eat drugs in search of the next greatest app,” he said. “Burning Man is no longer a counterculture revolution. It’s now become a mirror of society.”

Strangely, the tech elite won’t disagree with Mr. Hanson about it being a reflection of society. This year at the premiere of the HBO show “Silicon Valley,” Elon Musk, an entrepreneur who was a founder of PayPal, complained that Mike Judge, the show’s creator, didn’t get the tech world because — wait for it — he had not attended the annual party in the desert.

“I really feel like Mike Judge has never been to Burning Man, which is Silicon Valley,” Mr. Musk said to a Re/Code reporter, while using a number of expletives to describe the festival. “If you haven’t been, you just don’t get it.”

Read the entire story here.

Image: Burning Man gallery. Courtesy of Burners.

Idea Soup

The Post-Capitalism Dream

Anti-capitalism_color

I’m not sure that I fully agree with the premises and conclusions that author Paul Mason outlines in his essay below excerpted from his new book, Postcapitalism (published on 30 July 2015). However, I’d like to believe that we could all very soon thrive in a much more equitable and socially just future society. While the sharing economy has gone someway to democratizing work effort, Mason points out other, and growing, areas of society that are marching to the beat of a different, non-capitalist drum: volunteerism, alternative currencies, cooperatives, gig-economy, self-managed spaces, social sharing, time banks. This is all good.

It will undoubtedly take generations for society to grapple with the consequences of these shifts and more importantly dealing with the ongoing and accelerating upheaval wrought by ubiquitous automation. Meanwhile, the vested interests — the capitalist heads of state, the oligarchs, the monopolists, the aging plutocrats and their assorted (political) sycophants  — will most certainly fight until the very bitter end to maintain an iron grip on the invisible hand of the market.

From the Guardian:

The red flags and marching songs of Syriza during the Greek crisis, plus the expectation that the banks would be nationalised, revived briefly a 20th-century dream: the forced destruction of the market from above. For much of the 20th century this was how the left conceived the first stage of an economy beyond capitalism. The force would be applied by the working class, either at the ballot box or on the barricades. The lever would be the state. The opportunity would come through frequent episodes of economic collapse.

Instead over the past 25 years it has been the left’s project that has collapsed. The market destroyed the plan; individualism replaced collectivism and solidarity; the hugely expanded workforce of the world looks like a “proletariat”, but no longer thinks or behaves as it once did.

If you lived through all this, and disliked capitalism, it was traumatic. But in the process technology has created a new route out, which the remnants of the old left – and all other forces influenced by it – have either to embrace or die. Capitalism, it turns out, will not be abolished by forced-march techniques. It will be abolished by creating something more dynamic that exists, at first, almost unseen within the old system, but which will break through, reshaping the economy around new values and behaviours. I call this postcapitalism.

As with the end of feudalism 500 years ago, capitalism’s replacement by postcapitalism will be accelerated by external shocks and shaped by the emergence of a new kind of human being. And it has started.

Postcapitalism is possible because of three major changes information technology has brought about in the past 25 years. First, it has reduced the need for work, blurred the edges between work and free time and loosened the relationship between work and wages. The coming wave of automation, currently stalled because our social infrastructure cannot bear the consequences, will hugely diminish the amount of work needed – not just to subsist but to provide a decent life for all.

Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. The system’s defence mechanism is to form monopolies – the giant tech companies – on a scale not seen in the past 200 years, yet they cannot last. By building business models and share valuations based on the capture and privatisation of all socially produced information, such firms are constructing a fragile corporate edifice at odds with the most basic need of humanity, which is to use ideas freely.

Third, we’re seeing the spontaneous rise of collaborative production: goods, services and organisations are appearing that no longer respond to the dictates of the market and the managerial hierarchy. The biggest information product in the world – Wikipedia – is made by volunteers for free, abolishing the encyclopedia business and depriving the advertising industry of an estimated $3bn a year in revenue.

Almost unnoticed, in the niches and hollows of the market system, whole swaths of economic life are beginning to move to a different rhythm. Parallel currencies, time banks, cooperatives and self-managed spaces have proliferated, barely noticed by the economics profession, and often as a direct result of the shattering of the old structures in the post-2008 crisis.

You only find this new economy if you look hard for it. In Greece, when a grassroots NGO mapped the country’s food co-ops, alternative producers, parallel currencies and local exchange systems they found more than 70 substantive projects and hundreds of smaller initiatives ranging from squats to carpools to free kindergartens. To mainstream economics such things seem barely to qualify as economic activity – but that’s the point. They exist because they trade, however haltingly and inefficiently, in the currency of postcapitalism: free time, networked activity and free stuff. It seems a meagre and unofficial and even dangerous thing from which to craft an entire alternative to a global system, but so did money and credit in the age of Edward III.

New forms of ownership, new forms of lending, new legal contracts: a whole business subculture has emerged over the past 10 years, which the media has dubbed the “sharing economy”. Buzzwords such as the “commons” and “peer-production” are thrown around, but few have bothered to ask what this development means for capitalism itself.

I believe it offers an escape route – but only if these micro-level projects are nurtured, promoted and protected by a fundamental change in what governments do. And this must be driven by a change in our thinking – about technology, ownership and work. So that, when we create the elements of the new system, we can say to ourselves, and to others: “This is no longer simply my survival mechanism, my bolt hole from the neoliberal world; this is a new way of living in the process of formation.”

…

The power of imagination will become critical. In an information society, no thought, debate or dream is wasted – whether conceived in a tent camp, prison cell or the table football space of a startup company.

As with virtual manufacturing, in the transition to postcapitalism the work done at the design stage can reduce mistakes in the implementation stage. And the design of the postcapitalist world, as with software, can be modular. Different people can work on it in different places, at different speeds, with relative autonomy from each other. If I could summon one thing into existence for free it would be a global institution that modelled capitalism correctly: an open source model of the whole economy; official, grey and black. Every experiment run through it would enrich it; it would be open source and with as many datapoints as the most complex climate models.

The main contradiction today is between the possibility of free, abundant goods and information; and a system of monopolies, banks and governments trying to keep things private, scarce and commercial. Everything comes down to the struggle between the network and the hierarchy: between old forms of society moulded around capitalism and new forms of society that prefigure what comes next.

…

Is it utopian to believe we’re on the verge of an evolution beyond capitalism? We live in a world in which gay men and women can marry, and in which contraception has, within the space of 50 years, made the average working-class woman freer than the craziest libertine of the Bloomsbury era. Why do we, then, find it so hard to imagine economic freedom?

It is the elites – cut off in their dark-limo world – whose project looks as forlorn as that of the millennial sects of the 19th century. The democracy of riot squads, corrupt politicians, magnate-controlled newspapers and the surveillance state looks as phoney and fragile as East Germany did 30 years ago.

All readings of human history have to allow for the possibility of a negative outcome. It haunts us in the zombie movie, the disaster movie, in the post-apocalytic wasteland of films such as The Road or Elysium. But why should we not form a picture of the ideal life, built out of abundant information, non-hierarchical work and the dissociation of work from wages?

Millions of people are beginning to realise they have been sold a dream at odds with what reality can deliver. Their response is anger – and retreat towards national forms of capitalism that can only tear the world apart. Watching these emerge, from the pro-Grexit left factions in Syriza to the Front National and the isolationism of the American right has been like watching the nightmares we had during the Lehman Brothers crisis come true.

We need more than just a bunch of utopian dreams and small-scale horizontal projects. We need a project based on reason, evidence and testable designs, that cuts with the grain of history and is sustainable by the planet. And we need to get on with it.

Read the excerpt here.

Image: The Industrial Workers of the World poster “Pyramid of Capitalist System” (1911). Courtesy of Wikipedia. Public Domain.

Idea Soup

Anthropo-Fracking — Monetizing You

While not known as retail innovators banks started charging us all manner of fees for every minutiae some time ago: the bounced check fee, the monthly checking fee, the statement fee, the paperwork fee, the outgoing wire fee, the incoming wire fee, the secondary account fee, the document discovery fee, the check copy fee, etc.

Then airlines jumped on the bandwagon: their cunning ploy to awe us with low fares while simultaneously shocking us with all manner of “ancillary fees”: the checked bag fee, the excess baggage fee, the large baggage fee, the food fee, the drink fee, the ticketing fee, the wifi fee, the check-in early fee, the seat selection fee, the group fee, the fee-fie-fo-fum fee, etc etc.

So, while you may believe that you are a valuable and marketable brand of one, most enterprises actually look upon you something more lowly, but financially attractive — you are nothing more than a cow to be milked, or a landscape to be fracked, of fees. Sadly, this movement towards “personal-fracking” — the monetization and mining of you — has only just entered its early stages. So, hold on tight to your wallet.

From the Guardian:

Fracking. Could there be a more perfect model for how we’re getting rinsed by this current conspiracy of government and commerce? In a world turned upside down, “conservative” now means the absolute opposite of “leaving things as they are”. Conservative means changing everything. It means dismantling things and selling off the bits. It means drilling into our lives and extracting the marrow.

Conservatism and conservation are now about as far apart as it’s possible to get. Friends of Conservation are the ones protecting the countryside. The ones who stand around self-consciously in terrible fancy dress, holding passive-aggressive placards in praise of the noble, selfless badger. Or basically any mammal that looks good in a waistcoat.

Friends of Conservatism, on the other hand, are the ones who roll up on heavy machinery like a pissed Ukrainian militia. The ones who drill deep beneath that area of local countryside whose only “use” so far has been as a picnic site. And who then pump into the ground powerful jets of high-pressure hydrogunk, splintering rock as easily as a walnut. And who, having sucked up a sky’s worth of valuable gas through a massive crack pipe, then pack up and lumber off to fracture and steal someone else’s underground treasure.

Welcome to capitalism’s late late show. If you can power-hose the last drop of value out of something, you now have an amoral imperative to do it. Fracking is the chief inspiration for today’s entrepreneurs, those “heroic wealth creators” so admired by Andy Pandery Burnham and half the Labour party. Everything is up for grabs now. The age of the racketeer is over. It’s all about fracketeering now.

A gang of London estate agents has invented something called a “client progression feeHere is a recent example. A gang of London estate agents has invented something called a “client progression fee”. Yeah, ha ha, the cheeky peaky blinders are leaching an extra grand and a half out of buyers just for accepting their offer on a property. Imagine that. Charging people for agreeing to sell them something. Arbitrarily monetising something that customers are obliged to do anyway.

It’s almost as if the property industry is a pirate economy serviced by unscrupulous thieving bastards drenched in melancholy duty-free fragrances. Let’s face it, estate agents have pretty much perfected the art of taking the piss with a straight face. One former estate agent told me the other day he was always instructed to make admin fees “whatever you think you can get away with … go high, then drop as a favour”. Classic surcharge frackery.

I had decided that of all the agents – sports, double, biological – estate agents were definitely the worst. Then I asked people on Twitter how they had been fracked over lately and they reminded me about letting agents. And about how every single person I’ve ever known who has had any dealings with a letting agent has had to recalibrate their view of the human race as a result. Has anyone ever got their exorbitant deposit back in full without an exhausting argument pointing out that three years of normal wear and tear can’t be classed as catastrophic damage? I’ve been hearing about people being charged a £90-per-person “reference fee” when moving between two properties run by the same agent, “so that’s £180 to ask themselves how we were as tenants”. Or being charged £50 for printing six pages of a rental contract. “I asked them to email it so I could print it. They said no.”

The world of fracketeering is infinitely flexible and contradictory. Buy tickets online and you could be charged an admin fee for an attachment that requires you to print them at home. The original online booking fee – you’ve come this far in the buying process, hand over an extra 12 quid now or write off the previous 20 minutes of your life – has mutated into exotic versions of itself.

The confirmation fee. The convenience fee. Someone who bought tickets for a tennis event at the O2 sent me this pithy tweet: “4 tickets. 4 Facility Fees + 4 Service Charge + 1 Standard Mail £2.75 = 15% of overall £!”. Definitely a grand slam.

It’s amazing to think of a world that existed before the admin charge. It almost makes you nostalgic for a simpler and more innocent time, when racketeers would work out what it was we wanted and then supply it at an inflated price. You remember racketeers. Snappy dressers, little moustaches, connections to organised crime. Some of them did very well and went on to become successful publishers or peers of the realm. Quite a few old-school racketeers went into the “hospitality and leisure” business, where these days fracking is in full effect.

Read the entire story here.

 

Idea Soup

Socialism and Capitalism Share the Same Parent

Expanding on the work of Immanuel Kant in the late 18th century, German philosopher Georg Wilhelm Friedrich Hegel laid the foundations for what would later become two opposing political systems, socialism and free market capitalism. His comprehensive framework of Absolute Idealism influenced numerous philosophers and thinkers of all shades including Karl Marx and Ralph Waldo Emerson. While many thinkers later rounded on Hegel’s world view as nothing but a thinly veiled attempt to justify totalitarianism in his own nation, there is no argument as to the profound influence of his works on later thinkers from both the left and the right wings of the political spectrum.

[div class=attrib]From FairObserver:[end-div]

It is common knowledge that among developed western countries the two leading socioeconomic systems are socialism and capitalism. The former is often associated more closely with European systems of governance and the latter with the American free market economy. It is also generally known that these two systems are rooted in two fundamentally different assumptions about how a healthy society progresses. What is not as well known is that they both stem from the same philosophical roots, namely the evolutionary philosophy of Georg Wilhelm Friedrich Hegel.

Georg Wilhelm Friedrich Hegel was a leading figure in the movement known as German Idealism that had its beginnings in the late 18th century. That philosophical movement was initiated by another prominent German thinker, Immanuel Kant. Kant published “The Critique of Pure Reason” in 1781, offering a radical new way to understand how we as human beings get along in the world. Hegel expanded on Kant’s theory of knowledge by adding a theory of social and historical progress. Both socialism and capitalism were inspired by different, and to some extent apposing, interpretations of Hegel’s philosophical system.

Immanuel Kant recognized that human beings create their view of reality by incorporating new information into their previous understanding of reality using the laws of reason. As this integrative process unfolds we are compelled to maintain a coherent picture of what is real in order to operate effectively in the world. The coherent picture of reality that we maintain Kant called a necessary transcendental unity. It can be understood as the overarching picture of reality, or worldview, that helps us make sense of the world and against which we interpret and judge all new experiences and information.

Hegel realized that not only must individuals maintain a cohesive picture of reality, but societies and cultures must also maintain a collectively held and unified understanding of what is real. To use a gross example, it is not enough for me to know what a dollar bill is and what it is worth. If I am to be able to buy something with my money, then other people must agree on its value. Reality is not merely an individual event; it is a collective affair of shared agreement. Hegel further saw that the collective understanding of reality that is held in common by many human beings in any given society develops over the course of history. In his book “The Philosophy of History”, Hegel outlines his theory of how this development occurs. Karl Marx started with Hegel’s philosophy and then added his own profound insights – especially in regards to how oppression and class struggle drive the course of history.

Across the Atlantic in America, there was another thinker, Ralph Waldo Emerson, who was strongly influenced by German Idealism and especially the philosophy of Hegel. In the development of the American mind one cannot overstate the role that Emerson played as the pathfinder who marked trails of thought that continue to guide the  current American worldview. His ideas became grooves in consciousness set so deeply in the American psyche that they are often simply experienced as truth.  What excited Emerson about Hegel was his description of how reality emerged from a universal mind. Emerson similarly believed that what we as human beings experience as real has emerged through time from a universal source of intelligence. This distinctly Hegelian tone in Emerson can be heard clearly in this passage from his essay entitled “History”:

“There is one mind common to all individual men. Of the works of this mind history is the record. Man is explicable by nothing less than all his history. All the facts of history pre-exist as laws. Each law in turn is made by circumstances predominant. The creation of a thousand forests is in one acorn, and Egypt, Greece, Rome, Gaul, Britain, America, lie folded already in the first man. Epoch after epoch, camp, kingdom, empire, republic, democracy, are merely the application of this manifold spirit to the manifold world.”

[div class=attrib]Read the entire article following the jump.[end-div]

[div class=attrib]Image: The portrait of G.W.F. Hegel (1770-1831); Steel engraving by Lazarus Sichling after a lithograph by Julius L. Sebbers. Courtesy of Wikipedia.[end-div]

Idea Soup

Work as Punishment (and For the Sake of Leisure)

Gary Gutting, professor of philosophy at the University of Notre Dame reminds us that work is punishment for Adam’s sin, according to the Book of Genesis. No doubt, many who hold other faiths, as well as those who don’t, may tend to agree with this basic notion.

So, what on earth is work for?

Gutting goes on to remind us that Aristotle and Bertrand Russell had it right: that work is for the sake of leisure.

[div class=attrib]From the New York Times:[end-div]

Is work good or bad?  A fatuous question, it may seem, with unemployment such a pressing national concern.  (Apart from the names of the two candidates, “jobs” was the politically relevant word most used by speakers at the Republican and Democratic conventions.) Even apart from current worries, the goodness of work is deep in our culture. We applaud people for their work ethic, judge our economy by its productivity and even honor work with a national holiday.

But there’s an underlying ambivalence: we celebrate Labor Day by not working, the Book of Genesis says work is punishment for Adam’s sin, and many of us count the days to the next vacation and see a contented retirement as the only reason for working.

We’re ambivalent about work because in our capitalist system it means work-for-pay (wage-labor), not for its own sake.  It is what philosophers call an instrumental good, something valuable not in itself but for what we can use it to achieve.  For most of us, a paying job is still utterly essential — as masses of unemployed people know all too well.  But in our economic system, most of us inevitably see our work as a means to something else: it makes a living, but it doesn’t make a life.

What, then, is work for? Aristotle has a striking answer: “we work to have leisure, on which happiness depends.” This may at first seem absurd. How can we be happy just doing nothing, however sweetly (dolce far niente)?  Doesn’t idleness lead to boredom, the life-destroying ennui portrayed in so many novels, at least since “Madame Bovary”?

Everything depends on how we understand leisure. Is it mere idleness, simply doing nothing?  Then a life of leisure is at best boring (a lesson of Voltaire’s “Candide”), and at worst terrifying (leaving us, as Pascal says, with nothing to distract from the thought of death).  No, the leisure Aristotle has in mind is productive activity enjoyed for its own sake, while work is done for something else.

We can pass by for now the question of just what activities are truly enjoyable for their own sake — perhaps eating and drinking, sports, love, adventure, art, contemplation? The point is that engaging in such activities — and sharing them with others — is what makes a good life. Leisure, not work, should be our primary goal.

Bertrand Russell, in his classic essay “In Praise of Idleness,” agrees. ”A great deal of harm,” he says, “is being done in the modern world by belief in the virtuousness of work.” Instead, “the road to happiness and prosperity lies in an organized diminution of work.” Before the technological breakthroughs of the last two centuries, leisure could be only “the prerogative of small privileged classes,” supported by slave labor or a near equivalent. But this is no longer necessary: “The morality of work is the morality of slaves, and the modern world has no need of slavery.”

[div class=attrib]Read the entire article after the jump.[end-div]

[div class=attrib]Image: Bust of Aristotle. Marble, Roman copy after a Greek bronze original by Lysippos from 330 BC; the alabaster mantle is a modern addition. Courtesy of Wikipedia.[end-div]

Idea Soup

Crony Capitalism

We excerpt below a fascinating article from the WSJ on the increasingly incestuous and damaging relationship between the finance industry and our political institutions.

[div class=attrib]From the Wall Street Journal:[end-div]

Mitt Romney’s résumé at Bain should be a slam dunk. He has been a successful capitalist, and capitalism is the best thing that has ever happened to the material condition of the human race. From the dawn of history until the 18th century, every society in the world was impoverished, with only the thinnest film of wealth on top. Then came capitalism and the Industrial Revolution. Everywhere that capitalism subsequently took hold, national wealth began to increase and poverty began to fall. Everywhere that capitalism didn’t take hold, people remained impoverished. Everywhere that capitalism has been rejected since then, poverty has increased.

Capitalism has lifted the world out of poverty because it gives people a chance to get rich by creating value and reaping the rewards. Who better to be president of the greatest of all capitalist nations than a man who got rich by being a brilliant capitalist?

Yet it hasn’t worked out that way for Mr. Romney. “Capitalist” has become an accusation. The creative destruction that is at the heart of a growing economy is now seen as evil. Americans increasingly appear to accept the mind-set that kept the world in poverty for millennia: If you’ve gotten rich, it is because you made someone else poorer.

What happened to turn the mood of the country so far from our historic celebration of economic success?

Two important changes in objective conditions have contributed to this change in mood. One is the rise of collusive capitalism. Part of that phenomenon involves crony capitalism, whereby the people on top take care of each other at shareholder expense (search on “golden parachutes”).

But the problem of crony capitalism is trivial compared with the collusion engendered by government. In today’s world, every business’s operations and bottom line are affected by rules set by legislators and bureaucrats. The result has been corruption on a massive scale. Sometimes the corruption is retail, whereby a single corporation creates a competitive advantage through the cooperation of regulators or politicians (search on “earmarks”). Sometimes the corruption is wholesale, creating an industrywide potential for profit that would not exist in the absence of government subsidies or regulations (like ethanol used to fuel cars and low-interest mortgages for people who are unlikely to pay them back). Collusive capitalism has become visible to the public and increasingly defines capitalism in the public mind.

Another change in objective conditions has been the emergence of great fortunes made quickly in the financial markets. It has always been easy for Americans to applaud people who get rich by creating products and services that people want to buy. That is why Thomas Edison and Henry Ford were American heroes a century ago, and Steve Jobs was one when he died last year.

When great wealth is generated instead by making smart buy and sell decisions in the markets, it smacks of inside knowledge, arcane financial instruments, opportunities that aren’t accessible to ordinary people, and hocus-pocus. The good that these rich people have done in the process of getting rich is obscure. The benefits of more efficient allocation of capital are huge, but they are really, really hard to explain simply and persuasively. It looks to a large proportion of the public as if we’ve got some fabulously wealthy people who haven’t done anything to deserve their wealth.

The objective changes in capitalism as it is practiced plausibly account for much of the hostility toward capitalism. But they don’t account for the unwillingness of capitalists who are getting rich the old-fashioned way—earning it—to defend themselves.

I assign that timidity to two other causes. First, large numbers of today’s successful capitalists are people of the political left who may think their own work is legitimate but feel no allegiance to capitalism as a system or kinship with capitalists on the other side of the political fence. Furthermore, these capitalists of the left are concentrated where it counts most. The most visible entrepreneurs of the high-tech industry are predominantly liberal. So are most of the people who run the entertainment and news industries. Even leaders of the financial industry increasingly share the politics of George Soros. Whether measured by fundraising data or by the members of Congress elected from the ZIP Codes where they live, the elite centers with the most clout in the culture are filled with people who are embarrassed to identify themselves as capitalists, and it shows in the cultural effect of their work.

Another factor is the segregation of capitalism from virtue. Historically, the merits of free enterprise and the obligations of success were intertwined in the national catechism. McGuffey’s Readers, the books on which generations of American children were raised, have plenty of stories treating initiative, hard work and entrepreneurialism as virtues, but just as many stories praising the virtues of self-restraint, personal integrity and concern for those who depend on you. The freedom to act and a stern moral obligation to act in certain ways were seen as two sides of the same American coin. Little of that has survived.

[div class=attrib]Read the entire article after the jump.[end-div]

[div class=attrib]Image: The Industrial Revolution brought about the end of true capitalism. Courtesy: Time Life Pictures/Mansell/Time Life Pictures/Getty Images.[end-div]

 

Idea Soup

Resurgence of Western Marxism

The death-knell for Western capitalism has yet to sound. However, increasing economic turmoil, continued shenanigans in the financial industry, burgeoning inequity, and acute global political unease, are combining to undermine the appeal of capitalism to a growing number of young people. Welcome to Marxism 2.012.

[div class=attrib]From the Guardian:[end-div]

Class conflict once seemed so straightforward. Marx and Engels wrote in the second best-selling book of all time, The Communist Manifesto: “What the bourgeoisie therefore produces, above all, are its own grave-diggers. Its fall and the victory of the proletariat are equally inevitable.” (The best-selling book of all time, incidentally, is the Bible – it only feels like it’s 50 Shades of Grey.)

Today, 164 years after Marx and Engels wrote about grave-diggers, the truth is almost the exact opposite. The proletariat, far from burying capitalism, are keeping it on life support. Overworked, underpaid workers ostensibly liberated by the largest socialist revolution in history (China’s) are driven to the brink of suicide to keep those in the west playing with their iPads. Chinese money bankrolls an otherwise bankrupt America.

The irony is scarcely wasted on leading Marxist thinkers. “The domination of capitalism globally depends today on the existence of a Chinese Communist party that gives de-localised capitalist enterprises cheap labour to lower prices and deprive workers of the rights of self-organisation,” says Jacques Rancière, the French marxist thinker and Professor of Philosophy at the University of Paris VIII. “Happily, it is possible to hope for a world less absurd and more just than today’s.”

That hope, perhaps, explains another improbable truth of our economically catastrophic times – the revival in interest in Marx and Marxist thought. Sales of Das Kapital, Marx’s masterpiece of political economy, have soared ever since 2008, as have those of The Communist Manifesto and the Grundrisse (or, to give it its English title, Outlines of the Critique of Political Economy). Their sales rose as British workers bailed out the banks to keep the degraded system going and the snouts of the rich firmly in their troughs while the rest of us struggle in debt, job insecurity or worse. There’s even a Chinese theatre director called He Nian who capitalised on Das Kapital’s renaissance to create an all-singing, all-dancing musical.

And in perhaps the most lovely reversal of the luxuriantly bearded revolutionary theorist’s fortunes, Karl Marx was recently chosen from a list of 10 contenders to appear on a new issue of MasterCard by customers of German bank Sparkasse in Chemnitz. In communist East Germany from 1953 to 1990, Chemnitz was known as Karl Marx Stadt. Clearly, more than two decades after the fall of the Berlin Wall, the former East Germany hasn’t airbrushed its Marxist past. In 2008, Reuters reports, a survey of east Germans found 52% believed the free-market economy was “unsuitable” and 43% said they wanted socialism back. Karl Marx may be dead and buried in Highgate cemetery, but he’s alive and well among credit-hungry Germans. Would Marx have appreciated the irony of his image being deployed on a card to get Germans deeper in debt? You’d think.

Later this week in London, several thousand people will attend Marxism 2012, a five-day festival organised by the Socialist Workers’ Party. It’s an annual event, but what strikes organiser Joseph Choonara is how, in recent years, many more of its attendees are young. “The revival of interest in Marxism, especially for young people comes because it provides tools for analysing capitalism, and especially capitalist crises such as the one we’re in now,” Choonara says.

There has been a glut of books trumpeting Marxism’s relevance. English literature professor Terry Eagleton last year published a book called Why Marx Was Right. French Maoist philosopher Alain Badiou published a little red book called The Communist Hypothesis with a red star on the cover (very Mao, very now) in which he rallied the faithful to usher in the third era of the communist idea (the previous two having gone from the establishment of the French Republic in 1792 to the massacre of the Paris communards in 1871, and from 1917 to the collapse of Mao’s Cultural Revolution in 1976). Isn’t this all a delusion?

Aren’t Marx’s venerable ideas as useful to us as the hand loom would be to shoring up Apple’s reputation for innovation? Isn’t the dream of socialist revolution and communist society an irrelevance in 2012? After all, I suggest to Rancière, the bourgeoisie has failed to produce its own gravediggers. Rancière refuses to be downbeat: “The bourgeoisie has learned to make the exploited pay for its crisis and to use them to disarm its adversaries. But we must not reverse the idea of historical necessity and conclude that the current situation is eternal. The gravediggers are still here, in the form of workers in precarious conditions like the over-exploited workers of factories in the far east. And today’s popular movements – Greece or elsewhere – also indicate that there’s a new will not to let our governments and our bankers inflict their crisis on the people.”

That, at least, is the perspective of a seventysomething Marxist professor. What about younger people of a Marxist temper? I ask Jaswinder Blackwell-Pal, a 22 year-old English and drama student at Goldsmiths College, London, who has just finished her BA course in English and Drama, why she considers Marxist thought still relevant. “The point is that younger people weren’t around when Thatcher was in power or when Marxism was associated with the Soviet Union,” she says. “We tend to see it more as a way of understanding what we’re going through now. Think of what’s happening in Egypt. When Mubarak fell it was so inspiring. It broke so many stereotypes – democracy wasn’t supposed to be something that people would fight for in the Muslim world. It vindicates revolution as a process, not as an event. So there was a revolution in Egypt, and a counter-revolution and a counter-counter revolution. What we learned from it was the importance of organisation.”

This, surely is the key to understanding Marxism’s renaissance in the west: for younger people, it is untainted by association with Stalinist gulags. For younger people too, Francis Fukuyama’s triumphalism in his 1992 book The End of History – in which capitalism seemed incontrovertible, its overthrow impossible to imagine – exercises less of a choke-hold on their imaginations than it does on those of their elders.

Blackwell-Pal will be speaking Thursday on Che Guevara and the Cuban revolution at the Marxism festival. “It’s going to be the first time I’ll have spoken on Marxism,” she says nervously. But what’s the point thinking about Guevara and Castro in this day and age? Surely violent socialist revolution is irrelevant to workers’ struggles today? “Not at all!” she replies. “What’s happening in Britain is quite interesting. We have a very, very weak government mired in in-fighting. I think if we can really organise we can oust them.” Could Britain have its Tahrir Square, its equivalent to Castro’s 26th of July Movement? Let a young woman dream. After last year’s riots and today with most of Britain alienated from the rich men in its government’s cabinet, only a fool would rule it out.

[div class=attrib]Read the entire article after the jump.[end-div]

[div class=attrib]Image: Portrait of Karl Marx. Courtesy of International Institute of Social History in Amsterdam, Netherlands / Wikipedia.[end-div]

Art

Burning Man as Counterculture? Think Again

Fascinating insight into the Burning Man festival courtesy of co-founder, Larry Harvey. It may be more like Wall Street than Haight-Ashbury.

[div class=attrib]From Washington Post:[end-div]

Go to Burning Man, and you’ll find everything from a thunderdome battle between a couple in tiger-striped bodypaint to a man dressed as a gigantic blueberry muffin on wheels. But underneath it all, says the festival’s co-founder, Larry Harvey, is “old-fashioned capitalism.”

There’s not a corporate logo in sight at the countercultural arts festival, and nothing is for sale but ice and coffee. But at its core, Harvey believes that Burning Man hews closely to the true spirit of a free-enterprise democracy: Ingenuity is celebrated, autonomy is affirmed, and self-reliance is expected. “If you’re talking about old-fashioned, Main Street Republicanism, we could be the poster child,” says Harvey, who hastens to add that the festival is non-ideological — and doesn’t anticipate being in GOP campaign ads anytime soon.

For more than two decades, the festival has funded itself entirely through donations and ticket sales — which now go up to $300 a pop — and it’s almost never gone in the red. And on the dry, barren plains of the Nevada desert where Burning Man materializes for a week each summer, you’re judged by what you do — your art, costumes and participation in a community that expects everyone to contribute in some form and frowns upon those who’ve come simply to gawk or mooch off others.

That’s part of the message that Harvey and his colleagues have brought to Washington this week, in his meetings with congressional staffers and the Interior Department to discuss the future of Burning Man. In fact, the festival is already a known quantity on the Hill: Harvey and his colleagues have been coming to Washington for years to explain the festival to policymakers, in least part because Burning Man takes place on public land that’s managed by the Interior Department.

In fact, Burning Man’s current challenge stems come because it’s so immensely popular, growing beyond 50,000 participants since it started some 20 years ago. “We’re no longer so taxed in explaining that it’s not a hippie debauch,” Harvey tells me over sodas in downtown Washington. “The word has leaked out so well that everyone now wants to come.” In fact, the Interior Department’s Bureau of Land Management that oversees the Black Rock Desert recently put the festival on probation for exceeding the land’s permitted crowd limits — a decision that organizers are now appealing.

Harvey now hopes to direct the enormous passion that Burning Man has stoked in its devotees over the years outside of Nevada’s Black Rock Desert, in the U.S. and overseas — the primary focus of this week’s visit to Washington. Last year, Burning Man transitioned from a limited liability corporation into a 501(c)3 nonprofit, which organizers believed was a better way to support their activities — not just for the festival, but for outside projects and collaborations in what festival-goers often refer to as “the default world.”

These days, Harvey — now in his mid-60s, dressed in a gray cowboy hat, silver western shirt, and aviator sunglasses — is just as likely to reference Richard Florida as the beatniks he once met on Haight Street. Most recently, he’s been talking with Tony Hsieh, the CEO of Zappos, who shares his vision of revitalizing Las Vegas, one of the cities hardest hit by the recent housing bust. “Urban renewal? We’re qualified. We’ve built up and torn down cities for 20 years,” says Harvey. “Cities everywhere are calling for artists, and it’s a blank slate there, blocks and blocks. … We want to extend the civil experiment — to see if business and art can coincide and not maim one another.”

Harvey points out that there’s been long-standing ties between Burning Man artists and to some of the private sector’s most successful executives. Its arts foundation, which distributes grants for festival projects, has received backing from everyone from real-estate magnate Christopher Bently to Mark Pincus, head of online gaming giant Zynga, as the Wall Street Journal points out. “There are a fair number of billionaires” who come to the festival every year, says Harvey, adding that some of the art is privately funded as well. In this way, Burning Man is a microcosm of San Francisco itself, stripping the bohemian artists and the Silicon Valley entrepreneurs of their usual tribal markers on the blank slate of the Nevada desert. At Burning Man, “when someone asks, ‘what do you do?’ — they meant, what did you just do” that day, he explains.

It’s one of the many apparent contradictions at the core of the festival: Paired with the philosophy of “radical self-reliance” — one that demands that participants cart out all their own food, water and shelter into a dust-filled desert for a week — is the festival’s communitarian ethos. Burning Man celebrates a gift economy that inspires random acts of generosity, and volunteer “rangers” traverse the festival to aid those in trouble. The climactic burning of the festival’s iconic “man”— along with a wooden temple filled with notes and memorials — is a ritual of togetherness and belonging for many participants. At the same time, one of the festival’s mottos is, ‘You have a right to hurt yourself.’ It’s the opposite of a nanny state,” Harvey says, recounting the time a participant unsuccessfully tried to sue the festival: He had walked out onto the coals after the “man”was set on fire and, predictably, burned himself.

[div class=attrib]Read the entire article after the jump.[end-div]

[div class=attrib]Image courtesy of Jailbreak.[end-div]

Art

I Scream, You Scream, We Should All Scream for The Scream

On May 2, 2012 The Scream sold at auction in New York for just under $120,000,000.

The Scream, actually one of 4 slightly different originals, painted by Edvard Munch, has become as iconic as the Apple or McDonalds corporate logo. And, that sums up the crass, financial madness that continues to envelop the art world, and indeed most of society.

[div class=attrib]More from Jonathan Jones on Art:[end-div]

I used to like The Scream. Its sky of blood and zombie despair seemed to say so much, so honestly. Munch is a poet in colours. His pictures portray moods, most of which are dark. But sometimes on a spring day on the banks of Oslofjord he can muster a bit of uneasy delight in the world. Right now, I would rather look at his painting Ashes, a portrayal of the aftermath of sex in a Norwegian wood, or Girls on a Pier, whose lyrical longing is fraught with loneliness, than at Munch’s most famous epitome of the modern condition.

The modern art market is becoming violent and destructive. It spoils what it sells and leaves nothing but ashes. The greatest works of art are churned through a sausage mill of celebrity and chatter and become, at the end of it all, just a price tag. The Scream has been too famous for too long: too famous for its own good. Its apotheosis by this auction of the only version in private hands turns the introspection of a man in the grip of terrible visions into a number: 120,000,000. Dollars, that is. It is no longer a great painting: it is an event in the madness of our time. As all the world screams at inequality and the tyranny of a finance-led model of capitalism that is failing to provide the general wellbeing that might justify its excesses, the 1% rub salt in the wound by turning profound insights into saleable playthings.

Disgust rises at the thought of that grotesque number, so gross and absurd that it destroys actual value. Art has become the meaningless totem of a world that no longer feels the emotions it was created to express. We can no longer create art like The Scream (the closest we can get is a diamond skull). But we are good at turning the profundities of the past into price tags.

Think about it. Munch’s Scream is an unadulterated vision of modern life as a shudder of despair. Pain vibrates across the entire surface of the painting like a pool of tears rippled by a cry. Munch’s world of poverty and illness, as Sue Prideaux makes clear in her devastating biography, more than justified such a scream. His other paintings, such as The Sick Child and Evening on Karl-Johan reveal his comprehensive unhappiness and alienation that reaches its purest lucidity in The Scream.

[div class=attrib]Read the entire article after the jump.[end-div]

[div class=attrib]Image: One of several versions of the painting “The Scream”. Painted in 1893, Edvard Munch. Courtesy of The National Gallery, Oslo, Norway.[end-div]

Idea Soup

America: Paradoxical icon of the new

[div class=attrib]From Eurozine:[end-div]

Blaming the American Way of Life for the ills of post-industrial European society is a poor excuse for Europeans’ own partiality to consumer pleasures, writes Petr Fischer. On a positive note, American individualism could teach Europe a thing or two about social solidarity.

“Business–Answer–Solution” reads the advertising banner of the subsidiary of a foreign company in the centre of Prague. At first sight, the banner is not particularly interesting, in this case meaning that it is not particularly surprising. Surprising things are those that capture our attention, that shock us in their particular way. This corporate motto repeats the famous, infinitely repeated mantra of aggressive global capitalism, its focus purely pragmatic: give us a problem and we will come up with a solution that profits both you and us. “Win-win capitalism”, one could say in today’s international newspeak.

What is interesting – in other words disconcerting – is the fact that the banner covers the window of a small shop situated directly behind the National Museum, a building that – as in every other European city – symbolizes a certain perception of historicity cultivated on the old continent at least since the nineteenth century. The National Museum preserves the history of the Czech nation, and the people who work in it analyse and reflect on Czech national existence, its peculiarity, uniqueness, difference or connectedness. This activity is not governed by the pragmatic slogan of performance, of completed things, of faits accomplis; rather, it is ruled by a different three words, directed at thinking and its incessant, uncertain movement: Discussion–Question–Searching.

Both slogans represent two sides of the same coin of western civilization, two sides that, so far, have been more or less separate. The first represents the straightforward American way, leveraging everything along the way, everything at hand that can help business; the latter represents the difficult, reflective way of the old continent, left by its American child so that it could later be changed according to America’s picture. The fact that the multinational company’s motto is located just “behind” the building that, synecdochically, expresses the basic historic orientation of all European nations, is symbolic. “Behind”, meta in Greek, describes, in the European tradition, something that transcends everything we can arrive at though normal reasoning. In Aristotle’s canon, so the philosophical legend has it, such was the name of the texts found in the library behind the thinker’s treatise on physics. However metaphysics has since come to signify a system of thought that transcends the world of tangible facts and things, that represents some invisible internal order of the world. Business–Answer–Solution, the catchword of American pragmatism, is, as its location behind the National Museum suggests, perhaps the only really functioning metaphysics of today’s world.

New is always better

Since its discovery, America has been referred to as the New World. But what exactly is new about it for the Europeans? In De la démocratie en Amérique, Alexis de Tocqueville – one of the first to systematically analyse American institutions, republican political systems, and above all what today is called the “American way of life” – concluded that the newness of America consist mostly of a kind of neophilia, a love of all that is new.

“The Americans live in a country of wonders, everything around them is in incessant motion, and every motion seems to be progress,” says de Tocqueville. “The image of the new is closely connected with the image of the better. They see no limits set by Nature on man’s efforts; in American eyes, that which does not exist is what no one has yet tried.” In this extension of the purest Enlightenment optimism, the new is associated with a higher, moral quality. The gaze of the man turns toward the future, the past ceases to be important because, in the rush towards the new, the better, it loses its value, becomes inferior. The essential is what will be, or rather, what part of the future can be realized “now”.

[div class=attrib]More from theSource here.[end-div]