No Austrians In Foxholes

The old joke goes there are no athiests in foxholes. With the crash of international financial capitalism there are no Austrians in foxholes. Capitalism rushes to the embrace of it's state to bail it out. Everyone now accepts that State Capitalism resulted from the previous Great Depression and in order to avoid another one, the State is required to save the financial market. Some American libertarians and conservatives decried the state bail out of the banks, but no rational self interested capitalist was listening to them.

Nor contrary to some wags were they thumbing through the Communist manifesto to find a solution. They simply were returning to their Keynesian roots, apologizing abjectly for their folly of declaring him dead and useless.

Suddenly the darlings of the neo-cons, Ayn Rand, von Mises and Hyaek, were no longer the belle's of the ball. They once again quickly became relegated to the dustbing of history. Once again an anomaly of booming capitalism, a joyful ideology for those who embraced the greed of an unregulated market, an excuse to line pockets of the wealthy while ignoring the neccisity of producing real value; goods, services, infrastructure. Today the bankers and financiers are now fully fledged Keyensians.

In the Nouvel Observateur weekly, columnist Jacques
Julliard rejoiced that France was no longer hearing “diatribes” against its
“archaic” system.“Where have the (economic)
liberals gone?” he asked. “Since Bush nationalized the American banking system
we don’t hear from them anymore.

Even the most stalwart follower of Ayn Rand has admitted the failure of her ideology.

Alan
Greenspan is having a crisis of faith.
The former chairman of the Federal
Reserve and long-time deregulator admitted to U.S. lawmakers yesterday he "made
a mistake" in assuming banks could self-regulate the complex derivatives
market.
It was an about-face for Mr. Greenspan, a diehard supporter of
deregulation. He was a close friend of Ayn Rand, the most notable of
libertarians who champion the individual over the state. Yesterday, he threw her
theories under the bus, but it was no shock to Ms. Rand's followers.

It is in fact startling to hear the right wing President of France sounding like a socialist, but not unexpected given the gravitas of the current crisis.

"The
idea of the all-powerful market that must not be constrained by any rules,
by any political intervention, was mad. The idea that markets were always right
was mad," Mr Sarkozy said. "The present crisis must incite us to refound
capitalism on the basis of ethics and work & Self-regulation as a way of
solving all problems is finished. Laissez-faire is finished. The all-powerful
market that always knows best is finished," he added.

In fact it appears that the only ones proclaming the joys of unregulated markets are those from the Eastern Bloc, former communists and socialists who have never experienced the joys of American capitalism in all its gory glory.

In a
letter published on Tuesday by the daily Mladá fronta Dnes, Czech
President
Václav Klaus says that the global financial crisis did not result
from
insufficient market regulation, but, on the contrary, from excessive
government
interventions and increasing public spending.
According to
Klaus, there is a
risk that the rescue packages proposed by some governments
will turn the
European banking system into a partially state-owned and
centrally regulated
sector.

Ironic that. He sounds like Bush, Paulson, and Greenspan prior to the crash. They now have abandoned their faith in self regulated markets, and have embraced the need for state capitalism; a regulated capitalism supported by huge investments of public funds.

"I
know many Americans have reservations about the government's
approach,
especially about allowing the government to hold shares in private
banks. As
a strong believer in free markets, I would oppose such measures under
ordinary circumstances. But these are not ordinary circumstances," Bush
said.

But in reality the state promoted the ideals of the financial and monopoly capitalists as their own, they did their bidding, even as they do it now. Its about power in and over the markets. There never was an unbridled capitalism of small self employed artisans, which is the libertarian ideal, in fact capitalism is not about work or business, but about accrual of capital for its own sake.

Whether it was Keynes and the social contract after WWII or the shift towards monetarist policies and free trade in the seventies, eighties and ninties, it was all done by the capitalist state, in order to maintain and stabilize capitalism.

The mistake made by the left and the right was to assume that state capitalism was 'socialism'.

This mistaken link between public ownership and socialism was the result of the ideologues of the 2nd International, who adovcated that capitalism would evolve into socialism, that is public capitalism would arise from private monopoly capitalism.

After the Bolshevik revolution, and the subsequent Great Depression, capitalism was in a historical crisis, its old models no longer sufficient to meet the demands of those who create capital, the working class. Class war was on the horizon, the final death knell of capitalism was being wrung by a mobilized militant working class and by the failure of financial capitals coinciding.

The capitalist state was reformed to meet this crisis,based on variations of models of Keynes General Theory. State Capitalism is the highest form of capitalism, and that is what Randites and Austrian School apologists forgot.

Is this ciris out of the ordinary as Bush claims? Was i unpredicatable as Greenspan and Volker claim. Why no. Many pundits have pointed ot the similarities of this crash to those in the past; some going as far back as the Great Crash of 1873 in the U.S., the Great Depression of 1931-33, the 1973 post Viet Nam war crash.

What do all these crashes have in common? They occurred in relation to rapid industrialization of economies during and after large scale wars. In the case of 1873, it occurred after the civil war destroyed the last of the small scale artisinal base of American industry replacing family shoe making businesses and the like with large scale factory production.

The Great Depression occurred after WWI and the 1973 crash occurred as a result of America's incurssion into Viet Nam.

At the begining of the Bush regime in the U.S. the Republican government went from having a surplus to having a deficit. And those wags on the right, the very same neo-cons who a decade before had deonounced government deficits that led to expanded public sector infrastructure growth, now were cheering on the Bush government to expand its deficit especially when it came to planning for war against Afghanistan and then Iraq.

The wat in Iraq led to a government deficit that dwarfs those of the seventies and eighties.

That is the elephant in the room. America celebrated like it was 1929 for eight years under Bush, while sending their sons and dughters to fight in a foriegn war. There was no war rationing, no draft call, no need to commit by Joe or Jane Yank to Bush's war. So it was party time back home.

America also ended it dominance in manufacturing and actual production during the Reagan era. As we entered the new millineum right wing libertarian mags like Reason praised the end of America's dominance in production claiming the new capitalism in America would be based on service sector jobs.

And they were partially right. With contracting out and offshoring an essential part of the New World Order of the WTO and expanding globalization of capital, America now found itself no longer manufacturing goods at home, but buying them at WalMart from newly emerging fordist economies in Asia.

Americans laid off in manufacturing ended up in low paid jobs selling products they once made at the local WalMart. America now relied upon its citizens to produce capital not through manufacturing but through consumption.

America made credit easily available, and American's liquidated their savings in an orgy of spending that kept America going for the past eight years.

Was this crash unexpected? Of course not. It began a year ago, but Bush, Paulson, Greenspan, Bernake, and the right wing neo-cons were in denial. I have blogged as have others predicting this crash. That it would be as serious as the Great Depressions of 1873 and 1933 was also not unexpected, nor was the fact that the monopoly and financial capitalists flight back into the safe arms of the Nanny State unexpected.

There are no Austrians in foxholes when the economy melts down. Ideology is tossed out and capitalists and their politicians once again embrace state capitalism to bail them out.


SEE:

CRASH
Black Gold
The Return Of Hawley—Smoot
Canadian Banks and The Great Depression
Bank Run
U.S. Economy Entering Twilight Zone


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Greenspan Bitch Slaps Bush

According to the Wall Street Journal in his new biography ex Fed Chairman Greenspan, a follower of Ayn Rand, bitch slaps the Bush regime. Too bad he didn't say this when he was still Fed Chairman.

Mr. Greenspan, who calls himself a "lifelong libertarian Republican," writes that he advised the White House to veto some bills to curb "out-of-control" spending while the Republicans controlled Congress. He says President Bush's failure to do so "was a major mistake." Republicans in Congress, he writes, "swapped principle for power. They ended up with neither. They deserved to lose."

Mr. Greenspan discovered that in the Bush White House, the "political operation was far more dominant" than in Mr. Ford's. "Little value was placed on rigorous economic policy debate or the weighing of long-term consequences," he writes.

And interestingly he takes no blame for the current housing crisis sub-prime melt down that he created when he was fed chairman.

Many economists say the Fed, by cutting short-term interest rates to 1% in mid-2003 and keeping them there for a year, helped foster a housing bubble that is now bursting.

Instead he blames communism, or at least the melt down of the Soviet Union.

He attributes the housing boom to the end of communism, which he says unleashed hundreds of millions of workers on global markets, putting downward pressure on wages and prices, and thus on long-term interest rates.

So it was not the Fed that brought down interest rates, or created the global capitalist boom rather it was the devolution of the Soviet Union and the massive amount of unemployed workers available world wide to drive down wages.

The wave of migrant workers now flooding Europe, like those flooding into America, created the housing boom, by being a cheap source of construction labour and as consumers of the housing.

Mr. Greenspan returns repeatedly to the far-reaching importance of communism's collapse. He says it discredited central planning throughout the world and inspired China and later India to throw off socialist policies.

As well as cheap labour in the new fordist economies of China and India, especially the formers transformation from state capitalism to monopoly capitalism directly impacted on the American and global markets more than anything he and his monetarist pals did.

Confession is good for the soul. Ironically that confession fits classic Marxism more than it does the wacky ideology of his idol Ayn Rand.

And here is another irony that the joy expressed by the monetarists over the transformation of state capitalist economies to fordist monopoly capitalism will result in more inflation, their bugaboo.

In coming years, as the globalization process winds down, he predicts inflation will become harder to contain. Recent increases in the price of imports from China and a rise in long-term interest rates suggest "the turn may be upon us sooner rather than later."

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Ron Paul Quotes Ayn Rand

Ron Paul quotes Ayn Rand in the Republican Presidential Debate last night on the controversy of Gays and Lesbians in the Military.

Should gays and lesbians be allowed to serve openly in the U.S. military? The audience applauded Texas Rep. Ron Paul’s answer.

“We don’t get our rights because we’re gays or women or minorities. We get our rights from our creator as individuals. So every individual should be treated the same way,” Paul said.

“If there is homosexual behavior in the military that is disruptive, it should be dealt with. But if there’s heterosexual sexual behavior that is disruptive, it should be dealt with.

“So it isn’t the issue of homosexuality. It’s the concept and the understanding of individual rights,” he said.

Individual rights are not subject to a public vote;

a majority has no right to vote away the rights of a

minority; the political function of rights is

precisely to protect minorities from oppression by

majorities (and the smallest minority on earth is

the individual).

- Ayn Rand

Of course discrimination is never against an individual but against a social group the individual belongs to. Bigotry does not recognize the individual or their rights. Prejudice lumps people into categories of; them and us. Which is why it is discrimination.

See:

Ron Paul

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Why the Conservatives Are Not Libertarians 2

Gee this sounds like Trudeau. The classic liberalism that social conservatives hate.

Individual rights are not subject to a public vote;

a majority has no right to vote away the rights of a

minority; the political function of rights is

precisely to protect minorities from oppression by

majorities (and the smallest minority on earth is

the individual).

- Ayn Rand

Why The Conservatives Are Not Libertarians

Not A Libertarian Among Them

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"Are Anarchists Thugs?"

A follow up on my; " Why The Conservatives Are Not Libertarians" in this case an explanation as to why todays right wingers who call themselves Libertarians are not. Because homegrown individualist anarchism which was Libertarianism was replaced after Benjamin Tuckers death with the pro capitalist ideology and idealization of Russian reactionary Ayn Rand and later still with the rantings of the Anti-Labour Theory of Value; Austrian School of Economics.

Neither Bombs Nor Ballots: Liberty & The Strategy Of Anarchism

In an article entitled "Are Anarchists Thugs?", Tucker offered a breakdown by profession of Liberty's anarchists. The greatest part proves to be of the professional/intellectual class; the remainder includes independent manufacturers and merchants, farmers, artisans and skilled workers. We see that, although the anarchists - especially of the Liberty group - were not latter-day Jeffersonians in any deep sense, they owned some characteristics in common. The anarchists' hard-core supporters were the socio-economic equivalents of Jefferson's yeoman-farmers and craftsworkers: a freeholder - artisan - independent merchant class allied with free-thinking professionals and intellectuals. These groups - in Europe as well as America - had socio-economic independence, and through their desire to maintain and improve their relatively free positions, had also the incentive to oppose the growing encroachments of the capitalist State.

Individualist anarchism, although suffering from the repression directed against the anarchists in general, appears to have dwindled into political insignificance largely because of the erosion of its political-economic base, rather than from a simple failure of its strategy. With the impetus of the Civil War, capitalism and the State had too great a head start on the centralization of economic and political life for the anarchists to catch up. This centralization reduced the independence of the intellectual/professional and merchant artisian groups that were the mainstay of the Liberty circle.

In 1911 Tucker judged that this centralizing process had created an accumulation of wealth in the "trusts" that had superseded their need for the "four monopolies." He argued that "even the freest competition" could not presently hope to destroy the trusts, which could afford to sacrifice large sums of money to remove new competition. Tucker thought that only political or revolutionary forces could now whittle down this concentration of capital. He warned, however, that the anarchistic economic solution - "and there is no other solution" - must be taught to following generations. In the meantime, anarchists who aid the "propaganda of State Socialism or [violent] revolution make a sad mistake indeed, "hastening the advent of revolution before the people were prepared to do without the State."

See:

The Era Of The Common Man

Once More On the Fourth

Keep Coulter I'll Take Paglia

New Libertarian Journal

State-less Socialism

The Right To Be Greedy

A Lesson in Mutual Aid

Political Imbalance

Libertarian Anti-Imperialism

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Radical Capitalists Not So Radical

Louis Rosetto, the "radical capitalist" who founded Wired magazine, is not a 'libertarian" despite what the Wall Street Journal says, he is an Ayn Rand capitalist apologist as is his magazine.

Wired Magazine in the nineties predicted that high tech capitalism was booming and would do so for the next 25 years. And then the dot.com bubble burst.

And yet the article made it onto the market as a book. A self fulfilling prophecy for the pre-Enron generation in Silicon Valley.

For the most part, the book lacks historical perspective--unless you count the authors' use of ''future history.'' For much of the book, they write as if they were looking back from the 21st century, giving their arguments an undeserved aura of certainty. This conceit may confound serious readers, for it produces a bizarre blend of real and imaginary companies in the index. For example, New York Times is followed there by a listing for Nippon Nano, a fictitious Japanese nanotechnology giant supposedly operating in the middle of the next century.

And we should give credence to these dweebs who call themselves 'libertarians" when in reality they are merely apologists for the newest regime of robber baron capitalism.

Like most of the Utopian idealists of the right they believe in what Ayn Rand called; Capitalism The Unknown Ideal. And that is what it is, an unknown ideal because the historical reality of capitalism clashes with their Walt Disney notions of idealized capitalism.

There has never been a free market under capitalism, because capitalism dominates markets, it abhors freedom and demands monopoly. It was in fact capitalism that created the State, the very state these dweebs protest against. If they had their idealized free market, capitalism would again create a State to to regulate competition and allow for the powers that be to gain a monopoly, which is how real life capitalism operates.

Capitalism as a "mode of production," Marx argued, is a historically new and distinct form of human society. True, in both the ancient world and feudalism there were "capitalists." That is, there was trade and money, there were merchants profiting from buying and selling. But these, by themselves, were insufficient to establish capital as the ruling principle and regulator of society.

To understand a mode of production, Marx suggested, we must look to the very core of society, and specifically to the way that surplus is pumped out of the direct producers. In previous forms of class society, exploitation took a definite form. The characteristic dominant social relation was that between lord and peasant, with the peasant family laboring more or less under its own self-direction and compelled, by force, to hand over surplus products and surplus labor to its exploiters.

In capitalism, by contrast, the dominant class relationship is that between capitalist and worker. The worker unlike the peasant is radically "dispossessed." Where the peasant family could sustain itself on the products of its own labor, modern workers cannot, for they lack direct access to the very means to live. They cannot feed themselves from their labor on the land, nor sell the products of their own labor, for they have access to neither land nor the tools and materials required for modern production. Instead, they must hire out the one thing they own - their "labor power," their human creative capacities - to employers in return for money wages, which they can spend purchasing the means to satisfy their needs. The principles of the market, money, exchange, profit, and the like thus penetrate into the very inner fabric of capitalist society in a way that was simply not true for earlier forms of society. The key to the emergence of capitalism was something new: the creation of this radically dispossessed figure, the wage worker.

h/t to Diogenes Borealis


See:

Monopoly Capitalism in Cyberspace

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