Superfunds and ‘We are the shareholders’

February 19, 2018

Australian Banks are trying to defend their excessive profits and lack of competition by using the furphy that because Superannuation funds are large owners of shares, that their profits benefit ordinary Australians who own the shares through those funds. However, reality is more complicated than that

1) Large amounts of fees are siphoned off in fees to the super funds, and go to superfund managers – so the main beneficiaries are the managers and people with large superfund holdings, not ordinary Australians, unless perhaps the funds are industry based. The first fund I was in cost more in entrance and exit fees than I could possibly earn on input. This is clearly not the banks fault, but it indicates something odd about the way ‘we’ own these shares. Putting it in another way, the rational action of fund managers acting for their own benefit with these shares, does not have to deliver maximum benefit to the people who pay into the fund.

2) We “ordinary Australians” do not own the shares. We cannot vote, we cannot influence bank policy because of those shares. We do not hold the rights associated with those shares. Those shares are owned by the superfund, and any input into the bank will tend to benefit the fund not its members. It is irrelevant as to whether it might be ‘better’ for large institutions to take those rights away from us and exercise them as if they owned the shares – which they do (again the point is that the institutions have the ownership not ordinary Australians).

3) This fictitious ownership only exists as long as we keep paying the super company. Again we do not own the shares, we pay the Superfunds to own them, hopefully (but certainly not guaranteedly) on our behalf.

4) However, we take the costs and losses associated with those shares, the funds continue to pay out to themselves, irrespective of loss. This is the usual privatization of profits, publicization of loss common in capitalism.

5) The banks may also have holdings in the Superfund, and thus outweigh any objections that individual members have to the way they operate. and use the shareholdings to benefit themselves and shut down inquiries by the fund into the way profits are made, declared and distributed.

6) It is more than likely that most of the bank shares are owned by a very few, and only a few shares owned by the many.

As usual, the market is structured by political action, usually the action taken by those who are wealthy, and is intended to benefit them. The market is rarely ever neutral – it is intertwined with power relations.

(Some of these arguments borrowed from a critical thread in response to an article on the Conversation)


Flux and Transformation

February 18, 2018

This is a comment inspired by a video whose URL is at the end of the post, about interconnectivity, and how the human body replaces itself, by absorption and excretion.

There are a lot of processes which demonstrate interconnectivity, however, far more importantly this argument really demonstrates the possible basis of reality is flux, change and transformation.

This is difficult to get, because the whole trend of western metaphysics is towards the idea that reality is eternal and unchanging, whether this is expressed in notions of the unchanging God, or the unchanging archetypes, or the unchanging nature of elementary particles such as atoms. All of these ideas can support interconnectivity, but it is the interconnectivity between things which do not change – at best it is about ‘flow’ of unchanging things.

This view of reality as fixed, seems to lead towards pathological behaviour, as action becomes setting up the perfect structures, the perfect reality and clinging to it. Spirituality is about clutching to peace, or growing in a particular way. Psychology can insist that we should always be happy or self-actualising or something. Politics is about holding to the structures you have pronounced to be the best – at the moment our politics seems devoted to maintaining the power of established corporations and their plutocracy rather than the survival, or gentle transformation, of the world they depend upon.

However, if reality is flux and transformation, then everything changes all the time. Furthermore, given complex systems theory, it seems that everything changes unpredictably in specific; we might be able to predict trends, but we cannot predict specific results. One of the properties specified by what we call ‘reflexivity’ is that if people think they understand the ‘systems’ they are in, then their behaviour changes and the system changes the way it works. This change may not be for the better.

In his book known as ‘metaphysics’, Aristotle points out that Plato accepted the world is flux, but insisted that real reality is fixed, because otherwise it is impossible to speak truth. If everything is constantly changing then you cannot say anything true about them, as they will have changed. Aristotle seems correct in his interpretation of Plato to me, and this is a classic example of a philosopher encountering an uncomfortable position (ie everything is flux) and deciding that because it is uncomfortable it is untrue.

There are other ways around this problem. Firstly it may not be possible to speak absolute truth, but that does not mean we cannot speak and think as accurately as we can (and that means accepting flux, misunderstanding and degrees of uncertainty). We can also speak in terms of flux, talking say of ‘patterns’ rather than structures, and temporary stasis rather than permanent equilibrium, we can give up expectations that we should know how things will turn out, and be prepared to learn from events as they happen. At the moment, if our actions produce bad results we are prone to deny this, and apply our actions more stringently and rigorously.

To reiterate, we are caught in and part of a series of largely unpredictable fluxations. However, if we think that things should be eternal and unchanging, or we think that good things should be unchanging, we attempt to imprison that flux. This generally adds to suffering and increases apparent destruction and disorder. A current example, is the refusal to deal with climate change, and the tendency in Australian and US politics of trying to accelerate and maintain fossil fuels, old styles of concrete, environmental clearing and de-naturing. This is an attempt to cling onto an old order which nowadays produces destruction, and will produce more and more suffering the longer it is clung to.

These points should be obvious to Jungians, as expectation of flux comes out of alchemy, and alchemy is the art and science of transformation. It tells us that the world is constantly transmuting, and that transmutation processes can look messy and chaotic, and that attempts to avoid the realisations of painful stages can be disastrous. It also provides symbolic guides for working with events rather than against events, or providing direction without compulsion. As such alchemy is still the radical way, and difficult for us to really approach, but it may be necessary.

Origins of Capitalism?

February 7, 2018

Capitalism is a mode of power (primarily economic), based on appropriation of people’s goods and labour, and the distribution of wealth.

There are a number of forms of what is called capitalism. In my lifetime, where I live, we have had socialist-capitalism and we now have neoliberal capitalism, with more or less complete domination by the corporate sector. Scandinavian capitalism differs from French capitalism, differs from Anglo-capitalism and so on.

Capitalism is not trade. Trade exists in all societies, including ones that most people would not call capitalist. (China is weird, if people want to praise it they point out it is now capitalist, and if they want to condemn it they point out it is now communist. In either case there is trade.)

The origins of any of these forms of capitalism depend upon a heap of contingent factors, particularly including politics, and clearly cannot be summarized in a readable post – so this is only a summary for Anglo-capitalism.

Historically, one argument is that this capitalism grew out of the inequalities, violence and wealth accumulations of feudalism. It was boosted in the UK by dispossession of people from their land, which provided a class dependent on wage labor for survival, and who could be hired and dismissed with little cost or sense of social obligation. Wealth accumulation was also boosted by the slave plantations in the Americas, which pretty obviously depended on dispossession and non consensual labour. It was also boosted by private citizens engaging in piracy on the Spanish treasure ships on behalf of the crown. The British Tudor (and later) Monarchy promoted non-aristocratic citizens to positions of power and wealth, which weakened the aristocracy. This movement was accompanied by the rise of a powerful mercantile class, and between them they began to change the form of British politics and economic structures into one far less dependent upon royal patronage or the ties of feudal obligation.

Then the development of the steam engine, together with an abundance of coal, plus further political action and repression, allowed the relatively secure work and trade of crafts people to be destroyed, so more people became dependent upon capitalist industrialists for survival and more profit was channeled towards those who owned and controlled the technologies of production. The search for markets and resources to support this production led to Empires, as for example when the East India company took over India and destroyed local crafts and to help with their exports of cheap machine made materials (made with Indian cotton). There is a little dispute, but basically the now-standard argument is that the company and its accompanying British Rule completely destroyed the Indian non-capitalist economy and was largely responsible for the mass poverty and inequality that the 20th Century Indian State has had to deal with.

Capitalism has also taken advantage of fossilised energy. It is the development of energy, from slavery, wage labour to coal that produced whatever abundance was shared by the more fortunate members of capitalist society. The steam engine depended upon coal, but around about the start of the 20th Century, oil and petroleum upped the portability and effectiveness of energy once again and with it the apparent abundance. However, this abundance depends on power relations and law which allows pollution and poisoning costs to be ignored by the producer, or diffused onto those of ‘lesser importance’. It is always the way that the poor have pollution poured on top of them. This could be realistically known as ‘trickle down economics’. The current problem for capitalism is that the pollution it, and its variants, are engendering is likely to destroy the ecological systems it has depended upon but has refused to acknowledge. Today we see that battle being conducted in the form of a struggle over climate change and appropriate action.

While the economy is not natural, but political and embedded in power relations, it does need to be acknowledged that conquest and appropriation, in itself, does not lead to capitalism. The way plunder was organized in the Spanish Empire, for example, seems to have destroyed their economy. It was not invested in manufactures and trade – the ‘bloated’ aristocracy won out over the mercantile class and the peasants.

Everywhere that capitalism has gone, it has tried to destroy non-capitalist economies, through dispossession of property, the imposition of wage or indentured labour, and taxes which required people to pay cash which they had to earn through wage labour. There are endless colonial and business reports complaining about the laziness and irrationality of ‘natives’, who had better things to do with their lives than hold down jobs, and who did not need jobs to survive(until that independence was destroyed).

Capitalists always argue that capitalists are wealth creators and deserve special privilege and powers. Because large capitalists end up owning most of that wealth they are usually able to buy politicians and propaganda, and control society to act to give them those special privileges and powers. Hence capitalist power tends to reinforce itself, and make all life even more dependent on capitalist action, and capitalism seems like “common sense”.

We had a relatively generally prosperous period when capitalists feared revolution, but since that period has passed, wealth and power now accumulate primarily at the high ends.

Stages of social collapse….

February 2, 2018

Slightly Edited from “How societies collapse” by Umair Haque

Step one. The economy stagnates, [and social mobility declines. Largely because the elites, (religious, military, or mercantile) monopolise property, markets, and information, and control the government to protect themselves. They keep up, or increase, patterns of behavior that destroy the ecology they depend upon]. Life becomes harder and meaner for most people. The elites will deny the stagnation and destruction because, otherwise, they have admitted that they have failed, or are making things worse: in this way, a social contract and any sense of mutual obligation is broken and never gets repaired. [Note after and during the Great Depression and post WWII, there was an attempt to fix things up, because it seemed obvious that the ruling elites faced revolution if they did not.]

Step two. Ordinary people end up competing more and more viciously to maintain their living standards [as there is no means of co-operation which is allowed. Unions and other cooperative activities are broken or declared to be evil, as they could form challenges to the elites. Competition between each other and loyalty to the elite is lauded as prime virtues.]. Social bonds break and social norms begin to disintegrate.

Step three. People turn to supposed strongmen in the hope of gaining the safety democracy has failed to give them. This is the moment when decline implodes into true collapse. [Most of these ‘strongmen’ will defend the ruling elites while pretending to defend the people or the nation. People can regain valued cooperation by supporting the visible elite through patriotism, nationalism, party loyalty or religious fundamentalism. Things can feel better for some. There is hope.]

Step four. The strongest groups begin to exterminate the weaker perfectly legally. The insiders’ economic portions are kept stable by excluding, or eliminating, whole social groups altogether. [Or the dominant groups intensify application of the techniques which have given them wealth and which destroy life] This fact is kept from the people, officially — but who cannot be aware at some level?

Step five. Because the problem of stagnation is rarely solved by exterminating the weak [or destroying the ecology], the society has doomed itself to forever attempting to take its neighbouring societies harvests’ or falling apart. [In so doing, it generates enemies which can boost internal loyalty, and keep the system going until total collapse.] This is how fascism leads to atrocity, war, and mass murder.


Bitcoin and others

February 2, 2018

The value of any currency (and that includes gold) depends on magic.

  • 1) Whether there is faith in the currency.
  • 2) Whether there is faith in the people who issue the currency and their ability to enforce value (through violence or expectation of violence). The value of currency is tied up with perceptions of power. If an issuer cannot generate the perception of power in others, then their currency will become worthless.
  • 3) Whether there is faith that other people value the currency.
  • 4) Whether there is demand for the currency – ie other people will accept it or exchange it for other currencies.
  • 5) How plentiful the currency is perceived to be.
  • All currency is subject to bubbles and over enthusiasms. However the more stable the issuer, the more it is likely to be valued.

    Currency is about politics, and politics is about persuasion and power, that is ritual and magic (and usually a bit of human sacrifice, because nothing shows power better than this).

    Some Comments on The State of the Union

    February 1, 2018

    Some comments on parts of Donald Trump’s State of the Union address, from his point of view…..

    “All Americans deserve accountability and respect — and that is what we are giving them. So tonight, I call on the Congress to empower every Cabinet Secretary with the authority to reward good workers — and to remove Federal employees who undermine the public trust or fail the American people.”

    I want to get rid of public servants that are not convinced that I, Donald Trump, am god, and replace them with loyal sycophants – because people who agree with me know a super genius when they meet one.

    “In our drive to make Washington accountable, we have eliminated more regulations in our first year than any administration in history.”

    I am making Washington accountable, by removing its ability to prevent corporations from poisoning the environment or you. That’s what makes America Great!

    “We have ended the war on American Energy — and we have ended the war on clean coal. We are now an exporter of energy to the world”

    We can now cheer loudly as we destroy the world for profit. I’m going to make a real killing here.

    “To speed access to breakthrough cures and affordable generic drugs, last year the FDA approved more new and generic drugs and medical devices than ever before in our history.”

    Pharmaceutical corporation profit is much more important than your health. America runs on profit not people.

    “People who are terminally ill should not have to go from country to country to seek a cure — I want to give them a chance right here at home. It is time for the Congress to give these wonderful Americans the “right to try.””

    That is they have the “right to try” prayer, because it is all they can afford. And American religion is the best.

    “Any bill must also streamline the permitting and approval process — getting it down to no more than two years, and perhaps even one.”

    Because every loyal American wants a motorway going through their backyard, and should have no right to protest, because protestors are all Anti-fa scum.

    “For decades, open borders have allowed drugs and gangs to pour into our most vulnerable communities.”

    I keep telling you, immigrants are gang members and should be shot on sight. Get with it!

    “Around the world, we face rogue regimes, terrorist groups, and rivals like China and Russia that challenge our interests, our economy, and our values. In confronting these dangers, we know that weakness is the surest path to conflict, and unmatched power is the surest means of our defense.”

    Another arms race is a really productive way of getting taxpayer dollars into the pockets of hard working arms manufacturers. And, because we will let them sell their stuff everywhere, we need to pour even more taxpayer money into arms to keep ahead. The NRA will love it!

    “We must modernize and rebuild our nuclear arsenal”

    Because I like threatening people with nuclear war, and its ok because I’m not Hillary.

    And don’t forget I’m all about unifying America. Unity means praising me. That’s how you tell we are unified. We need to get rid of negative people now….

    Some remarks on Geo-Engineering

    January 22, 2018

    Geoengineering (GE) involves the attempt to solve the problems of climate change by altering the Earth’s ecology.

    It comes in two forms:
    Solar Radiation Management (SRM) in which you try and lower the amount of the Sun’s energy/heat reaching the earth’s surface. This can involve: mirrors in space, reflective gasses in the upper atmosphere, or painting mountains white.

    Carbon Dioxide Removal (CDR) in which you try and suck CO2 from power stations or from the atmosphere. One problem with this technique is the question of what you do with the CO2 once it is extracted.

    The idea of GE is that we can continue on with polluting, and try and lower the effects of that pollution. A common argument is that there is no evidence we can halt CO2 production and climate change, at this moment, so GE may give us a longer period in which we can change, or transition to a new set of energy generators.

    The primary question for both SRM and CDR is a simple one. GE, like everything else that depends on humans, is unlikely to be immune to its social bases. If the dynamics of contemporary societies are inherently destructive of ecologies, then GE is unlikely to prevent that destruction, nor to give a breathing space for new developments. It is likely to help make things worse, or continue the destructive dynamics of that system.

    Clearly if we use SRM, the system has to be continually maintained, and that will cost billions. There will be ongoing arguments over who should pay, and how much they should pay. If there is a financial collapse or large scale war, then that maintenance is unlikely to be without problems. In which case climate change would have the brakes taken off, and would accelerate rapidly, causing even worse climate turmoil.

    The governing idea of SRM seems that it is easier to change the whole ecological system than to change a political arrangement of economic power and profit. This I’m not sure about. The risk of unintended consequences when fiddling with a system as complex as that of climate is very high. We may already be living in a complex maladaptive system, which is bent on its own destruction and SRM simply magnifies this.

    GE could be the equivalent of encouraging smoking to preserve corporate profits, while trying to do research in the hope of some day being able to postpone the inevitable and increasing cancer toll. It might be simpler to discourage people from smoking and to make cigarettes less profitable.

    Basically, it can be suggested that if GE becomes the main way of dealing with problems of Climate change, then we live in a society in which ‘instrumental reason’ does not function very well as there are cheaper and possibly better options available, but those options require us to challenge established corporate power, and we are unlikely to do that successfully. I think the last 20 to 30 years of politics in the English Speaking world demonstrates that this failure is very likely to be the case.

    Amazingly it is true that among people who both support corporate dominance and deny climate change, GE is quite popular. At the moment I can hypothesise this is precisely because GE does not challenge corporate power, and provides an opportunity for leeching money away from the taxpayers, but I don’t know. It certainly strikes me that if you really wanted less State intervention in life, then you would not want geoengineering.

    I have not seen any viable self-supporting GE proposals. Nearly all of them require massive tax-payer subsidies, and some require appear to need massive cross-national governance and regulation. Of course we could give the massive subsidies to private enterprise and hope they do they job without any oversight, but I doubt that will appeal even to the pro-corporate power lobby. With CDR when that involves storage of CO2 underground, we know that ultimate and infinite responsibility of checking for leaks and collapse of storage, will reside with governments and taxpayers, as corporations do not last that long and will not take on those responsibilities. At the least, it seems probable that people will be concerned about other countries freeloading on their efforts, and there will be massive governmental jaunts to try and sort this out. The likelihood of small government and GE seems miniscule.

    More Government?

    January 22, 2018

    In my work I often come across people writing something like:

    There’s a category of people, often found mollycoddled inside government institutions such as universities, for whom “more government” is the answer to absolutely every problem.

    This annoys me.

    For one, in my entire and pretty lengthy life, I have never met anyone who thinks the answer to anything is “more government”. Never. It is a completely false accusation.

    There are, however, a large number of people who object to giving all governmental power to the corporate sector (as is the usual results of actions by those who supposedly support ‘small government’), and there are those who think that ‘the people’ should be able to participate in their own government and challenge corporate dominance.

    As you might expect both positions are easily misrepresented by people who work for the dominant powers who heavily fund think tanks and now permeate the university system. We might even say, by those cosseted by capitalism, for thinking ‘righteously’. They can pretend that wanting to be able to challenge corporate dominance, is a call for more government, knowing that hardly anyone will protest in favour of more government, once it is framed that way. This is also fundamentally dishonest.

    The real questions are: do you want input into the government, do you want to participate in government, or do you want to leave it to the corporately sponsored and paid for elites? Do you want to keep wondering why government decisions always seem to benefit that class, or do you want to do something about it?

    Capitalism appears to inherently intertwine itself into the State, resulting in more liberty for corporations, and more oppressive government for everyone else, unless it is challenged. At least I do not know of a historical circumstance in which this is not true. The fact that other systems can be even worse, does not disprove this.

    We need to challenge these glib pro-corporate memes which try and construct corporate interests and peoples interests as always the same and always coinciding only with corporate interests, and replace them with ones that reflect reality.

    What is Socialism?

    January 19, 2018

    Usually socialism means that ‘the people’ have the right to try and influence market power, so that the inherently top down processes of capitalism involving corporations and other elites do not tread all over them. Socialism also tries to provide increased opportunity for those who are disadvantaged, or who don’t have the luck to be born to wealthy parents, without lowering the opportunities for those who start off more fortunate. Capitalism seems to try to make it harder for people to succeed if they are not born into the right class. Metaphorically, if capitalism wants dancers, it breaks the legs of everyone who is poor, has them set badly, and then claims that the wealthy dance better because they have worked harder and have more intrinsic talent. Sure some people with broken legs will find a new way of dancing, but the corporate media will scoff endlessly. Socialism approves of social mobility and people bettering themselves, even when they are not of the right class.

    Attempting to curb corporate power and insure against bad luck, usually translates into government policies such as there should be a minimum wage (rather than that competition between workers should bottom out below what is needed to live). There should be some kind of unemployment benefits (so that people can risk changing work, or not be forced to work for wages less than the benefits) and this benefit should not just time out. There is usually some kind of provision for health care, so that poor people do not have to ‘choose’ to die or suffer unnecessarily. There is usually a provision for basic pensions, or a compensation scheme, for people who are ill or injured and cannot work.

    Socialism believes that a people can only govern themselves if there is a good education system not influenced entirely by commercial factors, as commerce has little relationship to truth. So it usually believes that spending taxpayers; money on such a system is a good investment, although it allows people to spend their own money without subsidy, on their ideas of education, provided it meets some basic quality standards – there will always be debate about these. A socialist state usually has a well funded and independent media provider – which is free of government intervention and commercial control – this has to be fought for, as capitalists like controlling all information. Ideally a socialist government should not be able to declare war unless there is a direct attack on the country, or it consults with the people.

    There are usually regulations on the ‘free market’ (as the desire of corporations to control markets completely is known), so that people cannot be injured, maimed or killed at work without some employer responsibility or compensation from the system. There are usually regulations so that corporations cannot poison, or pollute with complete impunity. It is usually expected that money earned in a country should be taxed in that country, as the money is earned in a situation built by that taxation and spending. Socialism encourages unions so that workers have some bargaining power at work and some rough power equality with their employers.

    The classic socialist states usually ran businesses in competition with private companies. The idea of this is to prevent cartels forming, to have real competition, and to try and foster innovation which is commercially risky. Socialist governments usually try and make sure there is an independent science sector as well to avoid commercial control and to try and prevent patents from inhibiting research.

    Basically socialism is about minimising the top down organisation that you get in capitalism where, when things are unchecked, you end up with a simple plutocracy and those who have the money have all the power – like we have now.

    Naturally plutocrats hate the idea of sharing power, so they spend a lot of money pretending that capitalist practice leads to liberty and good for all. It has never done so. Capitalism always leads to capitalists capturing the government and using it to further their interests at the expense of everyone else.

    Some Quotations from Adam Smith

    January 18, 2018

    “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the publick, or in some contrivance to raise prices.”

    “The capricious ambition of kings and ministers has not, during the present and the preceding century, been more fatal to the repose of Europe, than the impertinent jealousy of merchants and manufacturers”

    “Civil government, so far as it is instituted for the security of property, is in reality instituted for the defence of the rich against the poor, or of those who have some property against those who have none at all.”

    “Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to only so far as it may be necessary for promoting that of the consumer. The maxim is so perfectly self-evident that it would be absurd to attempt to prove it. But in the mercantile system the interest of the consumer is almost constantly sacrificed to that of the producer; and it seems to consider production, and not consumption, as the ultimate end and object of all industry and commerce.”

    “Folly and injustice seem to have been the principles which presided over and directed the first project of establishing those colonies [in the Americas]; the folly of hunting after gold and silver mines, and the injustice of coveting the possession of a country whose harmless natives, far from having ever injured the people of Europe, had received the first adventurers with every mark of kindness and hospitality.”