Tuesday, January 13, 2015

Niall Ferguson on Kisssinger's "World Order" [Part Three]

Niall Ferguson on Kissinger's World Order  [Part Three]
Thomas Riggins

Ferguson points out a basic question that Kissinger asks regarding our ability to understand international order. “Is there a single concept and mechanism logically uniting all things, in a way that can be discovered and explicated … or is the world too complicated and humanity too diverse to approach these questions through logic alone, requiring a kind of intuition and an almost esoteric element of statecraft?”  

This is a meaningless jumble of words. Logic is a method for determining the validity and soundness of arguments not a method for discovering how the world works. Discovery is basically an empirical affair of data collection from which generalizations can be made based on the coherence and correspondence of the data to our experience and understanding of its significance.

Kissinger does not think that "logic" can do the trick of understanding the world order but his alternative is not likely to do the trick either. Ferguson says Kissinger opts for “intuition” (the Muslims are yearning for us to intervene in their part of the world—oops wrong intuition) and the almost “esoteric” or the secret mysterious  ways of seeking out the truth. If we follow these ideas, I don’t think we will be seeing an improvement in US foreign policy any time soon.

Ferguson gives an example of Kissinger’s intuition— it can’t be demonstrated, but here it is. The “players” in “the great game of foreign policy” make their moves based on their understanding of history made by a “deep study of the past.” Since the US has made so many foreign policy mistakes it must be due to a “shallow” study or no study of the past. But wait— it doesn’t seem to be the history of the world or other countries that is the issue, but rather “self-understanding “ of your own history.

The US only needs to know its own deep history not, for example, the history of the Middle East to play the game there. Kissinger says, “For nations, history plays the role that character confers on human beings.” So don’t trust those Germans, Adolf, you know who, is still there lurking about in their esoteric intuitional subconscious. This is bad intuition. We get nowhere with the equation Tsar = Stalin = Putin or Russian Empire = Soviet Union = Russian Federation. 

Nations are not people anymore than corporations are and the human character cannot be applied to them. It is not an esoteric element we need to master but concrete social forces that can be studied in a scientific way. Looking at class struggles and economic interests and who wants to exploit whom will better explain how the “great game” is played. 

At this point there follows a long section about earlier works by Kissinger and more indulgent fawning over his ideas. To show what a great thinker Kissinger is I will resume this review with Ferguson's discussion of his views on Islam. 

From it's very beginnings Islam was, Kissinger says, "a religion, a multiethnic superstate, and a new world order."  In dealing with the Islamic Middle East today Ferguson says he has never seen Kissinger so critical of Bush and Obama as well as of Saudi Arabia. Here is his critique of the Saudis. The Saudi's have a very reactionary fundamentalist form of Islam as their state creed (Kissenger calls it "austere") and they have been supporting jihadists and fundamentalists around the world (some of whom are enemies of the US).

Kissinger says they have been making a great "error" in thinking they could support reactionary Islamist groups abroad and not have these groups also turn against them. The US, by the way, had this experience: it supported the most horrible Islamist terrorist groups you could imagine against the Soviets in Afghanistan only to have them turn against it after the Soviets were gone. 9/11 was an act of the US's Frankenstein's monster. The Saudi's can expect the same.

What isn't mentioned in this review is that Saudi Arabia is a medieval despotism that denies even basic democratic rights to its citizens. But the US is an ally of the Saudi state and thus itself a big supporter, de facto, of medieval despotism. Kissinger's criticism of the Saudis applies as well as to his and his successors attitudes toward that barbaric kingdom. It is love of oil, however, that is the true religion motivating US policy not engaging with  Islam.

Ferguson says Kissinger thinks the greatest problem for world order today is the sinking of the Middle East into sectarian strife. He doesn't mention that US policy is one of the major causes and supports of this strife which it promotes to justify its continued political (and military) interference. War and war profiteering is big business domestically. 

Instead, Ferguson says, regarding Kissinger's views,  "Even as the Sunni monarchies struggle to defend themselves against a rapidly metastasizing jihadist 'cancer'  that is in a large measure their own creation, Shia Iran edges steadily closer to being a nuclear-armed power."  What does one have to do with the other?

The main struggle of the Sunni monarchies is, however, against their own people who want democratic rights--- a struggle the US does not support as the case of Bahrain shows. The  "jihadi" threat is a cover for the repression of democracy. All talk about Iran's drive for nuclear weapons is meaningless blather as long as Israel is allowed to have nuclear weapons with no protest from the West.  


We will continue this review in part four.

Friday, January 9, 2015

Niall Ferguson on Kissinger's new book "World Order" [Part Two]

Thomas Riggins

‘Vice is a monster of so frightful mien,
 As, to be hated, needs but to be seen;
 Yet, seen too oft, familiar with her face,
 We first endure, then pity, then embrace.’
(Pope, Essay on Man)

Ferguson tells us that Kissinger (whose ideas he seems to embrace) does not  pay much attention to Obama’s “strategic incoherence” in his book. Ferguson, however, can read between the lines and detects that Kissinger was inspired by his “dismay” over “the amateurism of the past six years” of Obama foreign policy. Here is a quote from the great man himself: Kissinger asks: ”Where, in a world of ubiquitous social networks, does the individual find the space to develop the fortitude to make decisions that, by definition, cannot be based on a consensus.” Maybe it is foolishness, not fortitude, to try and make decisions based simply on what the “individual” thinks or feels. What decisions, other than what  you personally want to eat for dinner, want to do in you spare time, or what movie you want to watch, and the like are “by definition” impossible to decide by consensus?

Kissinger goes on to say that candidates running for office may be forced to spend more time  raising money then dealing with the big issues. Does a candidate try to explain his ideas to the people or does he tailor what he thinks to please the  voters. Ferguson implies that is what Obama types do because Kissinger's concerns would not have been aroused by the campaigns of such stalwart individuals as John McCain or Mitt Romney who took “scant regards” to focus groups in coming up with their absurd “foreign policy positions.”  

Perhaps if they had  they would have found out what people were really concerned about and would have abandoned some of their more looney ideas and made a better showings at the polls. Would anyone respect the foreign policy ideas of someone who picked a nut job for his running mate?

Ferguson reveals his own ineptitude when he says Obama made fun of Romney in a debate on foreign policy by saying “The 1980s are now calling to ask for their foreign policy back”  and thinks that those policies would offer better ways “of dealing with Vladimir Putin.” Well, Putin is no Gorbachev and if Ferguson thinks using thirty year old cold war techniques with Russia in the 21st Century is the way to go then he, not Obama, is the one who is “no master strategist.”

The “starting point” of Kissinger’s book, Fergunson writes, is that we are at the end of an "American world order” that was at its high point in the 1980s. The real title, then, of Kissinger’s book should have been, I think, The Loss of American World Domination.  Here is how Kissinger himself describes this 1980s word order: it was a time of “an inexorably expanding cooperative order of states observing common rules and norms, embracing liberal economic systems, forswearing territorial conquest, respecting national sovereignty, and adopting participatory and democratic systems of governance.”

 A quite imaginary fantasy on Kissinger’s part. Where was the respect for the sovereignty of Nicaragua, of Cuba, of Iran, of Grenada, of Cambodia, of the DPKR, of Vietnam, of Libya. What democratic systems were supported in Central America where the US supported genocide (Guatamala) and fascist regimes in other countries, not to mention in Indonesia and Chile.  The “cooperative order” only included states kowtowing to US interests. Kissinger himself helped, in 1970s, overthrow the democratically elected government in Chile and helped institute a fascist regime.

It seems that the American people no longer believe in this “definition” of world order. What Kissinger and Fergunson should have pointed out is that educated American people don’t believe that this fantastic description ever applied to “an American world order.”

 We are told there are now three other contending kinds of “world order” on the agenda. They are: 1) A “post-Westphalian European order” [i.e., post the 1648 Peace of Westphalia ending the Thirty Years War and other hostilities], one in Kissinger’s words  which is “a system of independent states refraining from interference in each other’s domestic affairs [the US will never stop doing this] and checking each other’s ambitions through a general equilibrium of power.” But the US is a super power, how could such an equilibrium be imposed? 

 2) An “Islamic world order” based on the ideas of Sultan Mehmed II (who conquered Constantinople in 1453 thus ending the (Eastern) Roman Empire) and who proclaimed “one empire, one faith, and one sovereignty in the world” and

 3) a “Chinese order” based on the imperial (actually Confucian) idea of “harmony under heaven” (tian-xia, maybe not such a bad idea, nothing wrong with harmony).

Let’s look more closely at these four kinds of “ideal” world order— American, European, Islamic, and Chinese.  We will look at them through the (jaundiced) eyes of Kissinger as reported by Ferguson. Let us dismiss the “American” order as we have already pointed out that it was a Kissinger fantasy. It boiled down to the attempted implementation of a US diktat in international affairs dressed up in democratic phraseology by Kissinger and his likes. It is still the US’s favorite modus operandi but as American power weakens it is becoming harder and harder to enforce.

The other three systems are also flawed. Kissinger thinks the “European” system is departing from its “Westphalian” ideals by trying to form the EU which combines “pooled sovereignty” with attempts to “limit the element of power” in the new institutions it is creating. The problem is that none of the countries in the EU want to end up bossed around by Germany which is where “pooled sovereignty” is taking them. 

The problem of the “Islamist world order” [other than the fact that it doesn’t exist] is, according to Kissinger, that it is “based on the fundamentalist version of their religion” and quests for “a global revolution.” This is to take the Islamic State, ISIS, ISIL or whatever you want to call it and the jihadists as far more historically significant than they are. 

They are local disturbances, generated in reaction to the failures of the American diktat in their part of the world, and will vanish as soon as  the Americans realize it is their own policies, based on ignorance of the culture, religion, and history of the area and motivated more by economic motives than anything else, which cause these groups to form and they then take steps to really disengage from meddling in the area. The UN will have to help the US get out gracefully as the US has shown it is incapable of conducting itself rationally when it comes to dealing with the people in this part of the world.

As for the “Chinese order” (another culture area of which Americans seem ignorant), Kissinger says earlier ideas about the “Middle Kingdom and its tributaries” have been “jettisoned.” It seems the Chinese (and others) are acting as “hyper-Westphalians” and see the area in terms “of aggressively competing nation states.” Kissinger finds this (his own imaginary construct) as “inapplicable” for this region.


There is a slight interruption in Fergunson’s review at this point so that he  can fawn all over Kissinger the statesman, the academic, the historical thinker ( he leaves out the war criminal, the supporter of fascists, the accomplice in murder, torture and genocide ). We will return to Ferguson’s analysis in our next installment (part 3 of the review of World Order.)

Piketty for Progressives -- Part 5

Thomas Riggins

This posting will cover sections 11 and 12 in Piketty's introduction to Capital in the 21st Century.

11. The Fundamental Force for Divergence: r > g

This formula, r is greater than g, where r is the  average annual rate of return on capital and g is the rate of annual economic growth “sums up the over all logic” of Piketty’s arguments regarding growing inequality under capitalism.

Piketty thinks the outlook for the 21st century is that r will be much greater than g and this means that inherited wealth will be greater than output or income. Under the rule of r > g it follows that people with wealth need save only a small fraction of their income and it will accumulate faster than the economy does thus increasing inequality. A real possibility exists that the increase in inequality will undermine the principles upon which bourgeois democracy is based. Billionaires, for example, could be able to sink so much money into elections and lobbying that they will basically control the electoral process and the government and people’s democratic rights will honored in name only if at all.

Piketty thinks that this scenario is a real possibility but it is not inevitable. Besides this powerful D-force there are also C-forces at work that could delay or even completely counteract it. He thinks, however, that the decrease of g in the coming decades is very likely.

His view is, he says, less “apocalyptic” than Marx’s view. But I think he mischaracterizes Marx’s outlook. He says Marx has a principle of “infinite accumulation and perpetual divergence” because he thinks g will be 0  due to 0 growth in productivity. Because of this there will be a revolution to overthrow capitalism (the Apocalypse). But this isn’t Marx’s view at all. His view, somewhat simplified, is that  capitalism will eventually run out of markets due to a crisis of over production and will breakdown because it won’t have the profits needed to sustain itself.

Piketty says his theory of r > g has nothing to do with any “Imperfections” in the market. It is not inevitable but is a likely occurrence and we should be aware of it. He stresses that the “more perfect” the capital market the more likely is r > g. Does this imply that the “better” the capitalist system is the more inequality it will create? This would make it incompatible with any kind of democracy and logically implies that some sort of fascist anti-democratic state is its natural outcome.

Piketty thinks the capitalist state will have to intervene and manipulate the outcome of the “more perfect” capitalist market to counteract the negative effects of r > g. He suggests “a progressive global tax on capital.” He doesn’t think this will be a real world solution to the problem and whatever the different nation states end up doing will be “less effective.” Does this mean that, after all, in the real world r > g is actually unstoppable? Is the Apocalypse destined to be our fate?

12. The Geographical and Historical Boundaries of Piketty’s Study

The upshot of this section is, that while Piketty will use information from many areas of the world to bolster and develop his views, he will rely “primarily on the historical experience of the leading historical countries: the United States, Japan, Germany, France, and Great Britain.”

He thinks the UK and France are particularly  important because they have the best economic records kept from the 19th century and they were the leading countries of the “first globalization” (1870-1914) of international trade and finance. This, by the way was the period analyzed by Lenin in his Imperialism: The Highest Stage of Capitalism. This first globalization was, Piketty says, “prodigiously inegalitarian.”

Piketty notes that the “first globalization,”  is “in many ways similar” to the second one which has been going on “since the 1970s.”  It is so similar that Lenin’s book on Imperialism is still largely relevant for understanding it. One of the weaknesses of Piketty’s book is that neither “Lenin” nor “Imperialism” appear in its index — a strange omission in a work trying to explain the origins of, and remedies for, inequality.

One of the similarities Piketty notes is the fact it was not until beginning of the 21st century that the leading imperialist countries attained the level of stock market capitalization  vis a vis GDP as the UK and France had at the beginning of the 20th century.

He next explains why he spends so much time on France. The first reason is that it has records going all the way back to the late 1700’s. The second reason is he thinks France is more typical than the US and its future will more likely be what most states will experience rather than that of the US. This is because the US population went from 3 million in 1776 to 300 million today. That quantitative leap has had its qualitative accompaniment  and the US “is no longer the same country it was.” France meanwhile has only doubled its population from 30 to 60 million over two hundred years not increased it a hundred fold. It is still basically the same country. Piketty doesn’t see the world population increasing 100 fold in the next two hundred years so French development is more likely representative to the future.

He means the trends in inequality seen in French history are more useful to predict future developments than are those seen in US history. This is another example of “American Exceptionalism" as the US experience “is in some sense not generalizable” and social class and inequality in the US are “so peculiar” when contrasted with other countries.

The third reason is that France is “interesting” because its revolution was more “bourgeois” than the English (1688) or the American (1776). The English kept their nobility and the Americans their slaves while the French actually established “ the ideal of legal equality [of men]  in relation to the market.”  This has important implications in discussing the growth and future development of inequality. Piketty also says that the concentration of wealth was  the same in Britain as in France so even though the French had legal equality for all and the British did not this was not enough to “ensure equality of rights tout court.”

We will finish the introduction to Piketty's book in the next posting.

Monday, January 5, 2015

Niall Ferguson on Kissinger's "World Order" [Part One]

Niall Ferguson on Kissinger's World Order  [Part One]
Thomas Riggins

A good book review both gives the gist of the book and allows you to decide if the book is worth reading or not. This is just what Niall Ferguson's review of Henry Kissinger's new 432 page "magisterial meditation" on world politics, World Order does  ["K of the Castle"- TLS 11/28/2014].  I'll give you the gist of Ferguson's review and enough quotes from Kissinger's book for you to decide for yourselves.

Spoiler alert! In case you are unfamiliar with the politics of Henry Kissinger (Nixon's Secretary of State) I can almost sum up his views in one sentence: He never met a fascist he didn't like. 

Ferguson seems to be a big fan of Kissinger and before getting down to the business of reviewing his book gives us a rather long prologue condemning the foreign policy of President Obama, "no master strategist" who "has been responsible for a succession of foreign policy debacles." 

I have no brief for Obama's foreign policies; they are policies aimed at maintaining the world hegemony of US imperialism and the economic impoverishment and virtual slavery of billions of people, the goals of which are basically the same as Kissinger's, but I object to Ferguson's attempt to personally blame Obama for "failures" that are inherent in the very nature and ends of imperialist policies themselves-- policies he inherited from even worse "master strategists" then he, one of whom was Kissinger himself.

What "debacles" does Ferguson have in mind.  We will give Obama an "F" if Ferguson is right about this, or an "E" for Effort if Furguson doesn't know what he is talking about. These are subjective letter grades but I think they are closer to reality than Ferguson's "debacles" view. Here are five "debacles" according to Ferguson:

1. The "reset" with Russia. This really failed, contra Ferguson, because Obama followed the strategy, already in place, of  pushing NATO right up as far as possible to the Russian borders. The policy was one of keeping "set" American and NATO goals and for the Russians to "reset" their opposition to acceptance of US plans. E

2. The "pivot" from the Middle East to East Asia. This is actually still on going, Ferguson's complaint is premature, but delayed because Obama's predecessors so screwed up the Middle East that it will be almost impossible for any American president to unscrew it. E

3. His "incoherence" with respect to Egypt: supporting the revolution against an ally (Hosni Mubarak) ! [only after it was a  fait accompli], then the Muslim Brotherhood after it won elections [isn't that kosher?], then supporting  a "bloody military coup" [is this the first time we have done this?] and, Ferguson might add, support for the new military government (which won an election too). As a matter of fact it has been standard American policy to support Egypt as an "ally" whatever government it has as long it will "play ball" with us. Obama is no different than any other president. E

4. His refusal to back up his "red line" on the use of chemical weapons in Syria. What is Ferguson talking about? Syria has turned over its chemical weapons. It is still unclear who all the actors are in chemical weapons use in Syria. Obama refused to start a military adventure vis a vis the "red line" because Congress and the American people were against it. E

5. His "hubris" in saying he doesn't "need George Kennan right now." Well Kissinger himself doubts that a George Kennan type of  strategy is applicable in all cases today. It's evidently only "hubris" ( "hubris" is not a "debacle" anyway) if Obama thinks that way. E

These examples are enough to see that Ferguson is just a mouth piece for the ultra right anti-Obama opposition to anything the first Black president of the US tries to do. Everyone of the above "failures" is based on the right wing Republican world view which Ferguson ultimately represents.

Ferguson goes on to say Obama’s “nadir” has been his “U-turn” reaction vis a vis Iraqi and Syria due to the rise of ISIS or IS, the Islamic State and its barbarism.  Isis is disgustingly "barbaric" but it is no more so than the US as the US's actions in Vietnam, Central America, and the Middle East, among other places, amply demonstrate. Ferguson says Obama has been forced to reengage in Iraq and is now bombing a Sunni force, the Islamic State, which was fighting against Bashir al-Assad whose government he has said should be overthrown. The attempt to overthrow Assad is probably a "debacle."

Why is that Obama’s “nadir?” It is the “nadir” of long standing American foreign policy going back over many years that has finally begun to unravel on Obama’s watch. He has to react as best he can to the problems resulting from the disastrous polices stretching back at least to the Reagan years (if not to the beginnings of the of the Cold War itself) with which he has been confronted. 

The real “nadir” was the George Bush administration’s illegal and immoral invasion of Iraq which upset the entire political equilibrium, such as it was,  in the Middle East and created a monstrous terrorist movement that had no real international traction until it was fueled by US imperialist hubris and the desire to control the oil resources of the area.

Ferguson accuses Obama of having no strategy for all this disorder. This is just like attacking the Fire Department for running hither and thither whenever a major fire breaks out due to arsonists running amok in the city. That may be the only strategy available until a way can be found to eliminate the arsonists. The arsonists that set the Middle East afire are still politically active in the US Senate and House of Representatives as well as in the board rooms of the military-industrial complex which makes billions of dollars in profits through wars and overseas US interventions.

Ferguson says that George W. Bush was blamed by the left for invading Iraq, but, unlike the hapless Obama, “at least Bush had a strategy.” Yes he did. It was invade, then introduce "democracy'', get rid of the evil doers, accept the love and appreciation of the people, then leave in triumph. His strategy was over on May 1, 2003 with his “Mission Accomplished” speech— about a month and a half after the invasion of Iraq. A strategy that led to complete and utter failure and a mission that 11 years later has no end in sight.  This is the strategy of "Do stupid stuff" the opposite of Obama's ("stuff" is a toned down version of the original sentiment).


Finally, after venting his spleen on Obama's policies [actually due to the failure of the Bush “strategy”] Ferguson turns to Kissinger’s book. But I have already exceeded my suggested word count so I will deal with this part of Ferguson’s review in my next installment. Stay tuned for Part Two

Friday, November 14, 2014

Piketty for Progressives -- Part 4


Thomas Riggins

9. The Major Results of Piketty's Study

Piketty says his study has arrived at two major results. First, that economic determinism is not  the answer to why we have inequality in wealth and income between people. But no economist worth his or her salt has ever been an economic determinist, so this is not a very startling conclusion.

Any Marxist would ready agree with this observation by Piketty (it is commonplace in the writings of Marx, Engels and Lenin): inequality results from the interplay and conflict of forces between people in the economic, political, and social institutions in which they find themselves and the relative power they have at their disposal to enforce their values and choices; inequality "is the joint product of all the relative actors combined." Marxists might be a little more concrete about who these actors are (classes and social strata) and what the power relations rest upon (ownership of the means of production, ability to create surplus value and such) but the first major result of Capital in the 21st Century echoes one of the major results of Capital in the 19th Century.

But, "the heart of the book" Piketty says, is his second major result. This is that there are major forces at work that push both towards increasing inequality (divergence) and decreasing inequality (convergence). I will call these D-forces and C-forces.

What is important, and will be rejected by all apologists of the Ann Rand version of laissez faire capitalist hokum (surely there are no intelligent Randists left after Greenspan's The Age of Turbulence) as well as mainstream bourgeois economists, is Piketty's findings that there is no internal mechanism within capitalism itself that can regulate and control the D-forces and prevent them from increasing "permanently."

Marxists would say the internal contradiction within capitalism between the C- and D-forces is certainly not permanent. Ultimately the build up of the pressure from the D-forces will explode the system (there cannot be infinite inequality). Piketty's language is not the language of Marxism, but in his own way he has restated, in the language of neoclassical economics, the objective reality of Marx's Apocalypse.

The D-forces are heading in that direction and Piketty wants to find a program that can bolster the strength of the C-forces and drag  back the D-forces, if not to a stop, at least to a non-critical mass. This won't be done within the capitalist system qua capitalist so the energy required by the C-forces must come from outside. There's the rub.

The above states the main points of this section. However, Piketty mentions two theories which have been put forth to counter the D-forces from within the system without extraneous help for the C-forces. Both of these theories are logically possible but their practical implementation as a solution to growing inequality is "largely illusory" if the history of capitalism has anything to tell us about them. I will only mention them in passing as Piketty doesn't put much stock in them.

The first is the  "human capital hypothesis." As technology advances workers need more and more skills and hence have to be paid more so capital will be transferred from the money bags to the working class increasing the C-forces and leading to greater democratic control of society. A pipe dream.

The second is that "class warfare" will be replaced by "generational warfare" because science is making people live longer. This type of "warfare" is more benign since all young people will end up old people (all workers won't end up capitalists on the class war model).  Young people will begin saving up for old age so they will have enough to mitigate the effects of the D-forces. The young will be ants and not grasshoppers. Another pipe dream.

It says something about "economics," as taught in bourgeois educational establishments, that capitalism's existential threat (unsustainable D-force pressure) can produce solutions that amount to pipe dreams.

The real counter to the D-forces, Piketty says, as revealed by history has been "the diffusion of knowledge and skills."  This "diffusion" must be an external factor independent of the capitalist system because Pitketty has said capitalism  has no
internal mechanism to prevent run away D-forces, or if it is an internal factor then it cannot prevent the Marxist Apocalypse.

10. Forces of Convergence, Forces of Divergence

Piketty says that while the diffusion of knowledge and skills is the main source for the C-forces, it is nevertheless a fact that the D-forces can overcome it and increase in power. This is because the C-forces need to be reinforced by social policies that are not sufficiently built into the mechanism of capitalism to counter the the D-forces (which are built in) on their own.

Presently there are two major D-forces  independently at work in the world economy. The threat, Piketty says, is that these two forces may merge and become unified thus creating a new and super powerful motor driving inequality.  From what would this Super D-force be composed? From the current D1-force which is the ability of top-earners to “quickly separate themselves from the rest by a wide margin” and the current D2-force which is itself an amalgamation of forces that bring about “an accumulation and concentration of wealth when growth is weak and the return on capital is high.” The D2-force is the “principal threat’’ to income equality.

Piketty uses the example of the United States from 1910 to 2010 to show how the D1-force has been developing. What has happened is an explosion in the income of the top managers of the large capitalist enterprises that dominate the economy. Gigantic inequality gaps separate this capitalist elite from ordinary workers and citizens. Piketty says the most likely explanation of this inequality gap is the power these capitalists have of setting “their own remuneration”  and to do so independently “of their individual productivity.”

This, by the way, this could never have come about in a properly functioning democratic society. It suggests that capitalism is incapable of creating such a society and that the problems of inequality cannot be solved within the parameters of such a society.

Bad as this D1-force is, it is the D2-force that Piketty considers the main threat to equality and the growth of the C-forces under capitalism. It is this second force that we will deal with in the next installment of “Piketty for Progressives.”

Monday, November 3, 2014

The Death of Klinghoffer: Reflections


Thomas Riggins 

All the recent fuss at the Metropolitan Opera over John Adams' 1991 opera The Death of Klinghoffer led me get the DVD from Netflix to watch. The DVD gave me the opportunity to start and stop and replay parts of the opera and the subtitles (even though the opera is in English) allowed me to follow the exact wording that was being used to express the ideas and emotions of the singers. The DVD is of the Penny Woolcock film version made for British TV in 2003 and is generally considered faithful to the staged version of the opera.

I think I can safely say there is nothing anti-Semitic or anti-Jewish or pro-terrorist about this opera. I can also say that those who claim that it is so have not seen it, or not understood it, or have a personal agenda to espouse having nothing to do with the merits of the opera.

In our political context in the US the main objection to the opera is that it is not anti-Palestinian either. The objectors seem to be of the opinion that you cannot be against anti-Semitism  unless you are also for anti-Palestinianism. The opera takes a stand against terrorism qua terrorism  and shows the futility and horror of trying to solve social and political problems waging terrorist actions against unarmed civilians.

The opera highlights three species of terrorism-- it sympathizes  with none of them. It highlights the terrorism waged against the Jews of Europe by European Christians who formed the core of the fascist movements in World War II and led to the concentration camps and the Holocaust.

 It also shows the terrorism unleashed against the civilian Arab population in Palestine by the Zionists after the independence of Israel when tens of thousands were driven from their homes and land and had their houses and fields turned over to Jewish settlers without recompense and many Arab men, women, and children were murdered by terrorist groups such as the Irgun led by future Prime Minister Menachem Begin: this was the Nakba.

And it shows the terrorism elicited by the Nakba in which the Palestinians engage. The high jacking of the Italian cruise ship the  Achille Lauro and the cold blooded murder of wheelchair bound senior citizen Leon Klinghoffer is the subject of the opera and it makes no excuse or attempt to glorify the action of the terrorists involved: members of the Palestine Liberation Front.

The Germans and the Israelis have made peace and the Germans have paid reparations to try and make up for the unforgivable and impossible to make up for actions of their terrorist forebears. Perhaps Israel can do the same for those who were the victims of the  Nakba and more recent acts of terrorism such as the killing of over two thousand civilians (including 500 children) in Gaza. Perhaps the Palestinian terrorists would reciprocate by stopping the killing of Israeli civilians including peaceful women and children.

If this opera has any message it is that terrorism breeds terrorism and is never justified as it diminishes the humanity of all who engage in it. The root cause of terrorism (one group's cruel and inhumane treatment of others) must be addressed without evasion and excuses.

Saturday, October 11, 2014

Piketty for Progressives -- Part 3

Thomas Riggins

5. From Marx to Kuznets, or Apocalypse to Fairy Tale

As we have seen, Piketty rejects Marx's views about the future of capitalistic inequality, which  he called "Apocalyptic", and in this section he will also reject the views of Simon Kuznets (1901-1985) which he finds too optimistic.  Kuznets engaged in empirical studies and arrived at the view that as capitalism became more advanced income inequality would decrease-- on the principle (mis-attributed to President Kennedy) that "a rising tide lifts all boats."

Although Piketty does not accept Kuznets’ conclusions, he credits him with being the first to empirically utilize two sources of information which must be used in conjunction to be able to meaningfully study income inequality and its evolution__ i.e., growth of national income for a country and the distribution of that income to individuals. It was using such information that Kuznets arrived at his views regarding the decrease of inequality. The question is--  did the data reflect universal trends within advanced capitalism or just an historical fluke? If the latter then Kuznets’ theory was a "fairy tale"-- as Piketty suggests by this section title.

6. The Kuznets Curve: Good News in the Midst of the Cold War

In this section Piketty says that Kuznets admitted his statistical discovery of a decrease in inequality in the US (the period covered was 1913 to 1948) was “largely accidental.” In his 1953 book Shares of Upper Income Groups in Income and Savings he even admonished his readers not to jump to conclusions based on his data. But that is just what he did himself two years later in a famous lecture where he proposed a bell curve to explain the relation between capitalism and inequality. As capitalism begins to develop inequality increases between the capitalists and the general population and peaks just as capitalism becomes mature and widespread, thereafter it begins to decline as the benefits of the capitalist system begin to be shared by all.

Even in this lecture Kuznets says his statistics reflect unique historical circumstances, but also suggests that, despite the historical specificity that shaped his curve, the inherent nature of the capitalist system itself would also work to produce the curve. This was simply cold war propaganda posing as science. Piketty points out that in the lecture Kuznets told his audience (it was a speech to the American Economics Association) that he was giving an optimistic twist to his theory to, in his own words, keep the Third World “within the orbit of the free world.”

Nevertheless, despite this lecture and other papers, Piketty says that Kuznets showed the true “scientific spirit” in his big 1953 book (the supposed first use of meaningful statistical analysis) even if the Kuznets curve is a fairy tale. It was the two world wars and the Great Depression that brought about a decrease in inequality not the inherent tendency of capitalism.

7. Putting the Distributional Question Back at the Heart of Economic Analysis

Piketty thinks the question about how wealth is distributed is important. He says there has been a big increase in economic inequality since the 1970s— in all the developed countries, but especially in the U.S. In the Third World it is possible that economic development may decrease inequality— especially the development of China. All of this, he says, is a cause “of deep anxiety.” He does not make clear why this should be so— whether it is the growth of inequality, the development of China, or both.

Also, markets that are supposed to exhibit “balanced growth” according to Kuznets and others ( real estate, oil and financial) are showing remarkable “disequilibrium.” Piketty asks who will be running the show in 2050 or 2100 (i.e., controlling the world as it were). He lists several possibilities, one of which is the Bank of China. I can see the origin of “anxiety.” The Bank of China is ultimately under the control of the Chinese Communist Party (it is state owned).

In any case, the distribution of wealth becomes, for Piketty, the most important area of study if we are to understand the growth of inequality. To determine this we must collect data on the economic history of many countries and forecast future developments by a scientific understanding of past and present trends.

8. The Sources Used in Piketty’s Book

Piketty says his work is basically an extension of the work begun by Kuznets in his study of the period 1913-1948 in the U.S.  Kuznets’ statistical methods were extended to France, the contemporary U.S., and to other countries. But “the primary source of data” for the book comes from the World’s Top Incomes Database (WTID). [Google: The World’s Top Incomes Database]

Piketty says there are TWO components of income— from labor and from capital.
He says labor income consists of wages, salaries, bonuses, non-wage labor, and income “statutorily classified” as such [tips?]. Capital income consists of rent, interest, dividends, profits, royalties, capital gains, and “other income” from land, real estate, financial instruments, industrial equipment, etc. [!]. It is obvious that this is an un-Marxist way of treating income but Piketty can define his categories anyway he chooses since he is not a Marxist economist. We shall see later how useful, or not, his definitions are.

Piketty says his book “stands out” from those before it because he has “made an effort to collect as complete and consistent a set of historical sources as possible" for the study of the distribution of income and wealth “over the long run.”

We will resume the fourth installment  of this commentary on Piketty’s introduction with the 9th section :“The Major Result’s of Piketty’s Study.”