Saturday, April 30, 2016

comment on an economic book review, Michael Hudson's "Killing The Host"

This entire book is explaining how Marx was clueless when it came to the dangers of finance capital displacing industrial capital. As Hudson explains, Marx was far too optimistic about capitalism. Marx thought banks would make loans to build capital infrastructure, not to merely to gain access to iPhone patents nor to buy 4 years of work from 2 moderately-intelligent people for $1 billion dollars (Google, FB, Snapchat, Whatsapp, Youtube) merely as a way to gain market-share eyes to advance monopolies on search, social connections, messaging, and  videos.  But the worst of the anglo-dutch loan situation is the loaning to drive up asset prices that stifles worker cost-efficiency and diverting what could have been tax revenue instead of bank profit, and the loans to take over infrastructure in order to sell it off, making a profit for the hawks and banks mainly by nullifying retiree plans and capitalizing on adverse stock market fluctuations. Notice there is no illegality in any of this detrimental behavior. There is only an absence of a functioning government that could stop macro activity that hurts the strength of us all. Good government enables and advances system-wide profit from cooperative behavior (prisoner's dilemma solution) at a level above the individual transactions. Individual transactions have zero concern about the system-wide effects of their transactions. A functioning healthy body results from the development of a governing brain over the system that keeps the cells from acting merely for highest profit (cancer).

Notice that Veblen (the only author Einstein liked as much as Bertrand Russell) and Marx's home country (Germany) is the one dominating the EU production world by NOT following anglo-dutch debtor-as-slave (heads bank wins, tails bank win) which is very different from stock investments where "creditor" (investor) depends on success of debtor.**  Or rather, regulations from GOVERNMENT (oh, the horror) on loans in Germany enabled Marx's capitalistic axioms to actually apply, propelling Germany to recurrent greatness without the fallout Marx thought would occur. How close is Germany to what Marx desired?  "Communistic" oligarchies like old Russia and old China from 1930's to 1989 (not the new ones) are not "Marxism" in action, but strong democracies are not far off as I'll explain.

**Except German attitude towards Greece where German banks want to follow anglo-dutch rules.

But as far as a world-order goes, this reviewer might be right: Hudson's godfather was Trotsky, who differed from Lenin in his Marxism by saying the world instead of individual countries should defend itself against capitalistic lobbying of government. Marxism was at its core an uprising against government from worker consciousness. How ironic "free market" capitalists also want an overthrowing, except they want some purely theoretical form of cooperative anarchy instead of "for the people" socialism.  We need more good governing and less bad governing, not more anarchy.  In the 3rd world there is not enough tax income to create a functioning government. It results in a very good model of anarchy. It can improve if outsiders allow them to engage in equitable trade, but only by getting together and forming a functioning democratic government ("capitalistic socialism").   Oligarchies are often the result of a democracy that failed to be as socialistic as the oligarchs promised. Not kicking private companies out is compatible with socialism. "For the people, by the people" is a socialist slogan, not just an American one. Venezuela is a democracy, pretending to have socialism when it has little.  Price controls (Nixon) and oligarchies (Venezuela) are not socialism, but they did occur in democracies (or "Republic" for the unimaginative). When a democratic vote turns into an oligarchy people wrongly yell "socialism". They should yell "democracy". The goal of lobbyists is to turn a democracy away from socialism into legalized capitalistic monopolies having a free-for-all via bad laws. Is it the government's fault the lobbyists are in the way, or the voters?  Will those former voters function better in anarchy?  

Socialism in the U.S. is being subverted by democratic voting that is allowing capitalism to lobby the government.

The entire reason democracy exists is so that it can bias capitalism in favor of socialism by giving everyone a single vote, subverting the non-equal money in capitalism, giving the poor future opportunity.Workers do not own all the shares like Marx wanted, but they can tax away ridiculous profits that were unfairly gained from capitalizing on society's need for a single-Search, single-social site, and dominant messaging apps. They succeed not by work, intelligence, or moral superiority, but by merely being the first that was good enough for society to bless with its need for a single-player monopoly.

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