December 13, 2011

Responses to M.C. Planck's comments on my most recent OWC article

Mr. Planck has brought up some interesting issues in response to my most recent Occupy Wall Street assessment, which I think are worth addressing. Here’s an extract from his comments:

“Another flaw in our public media is this meme of equivalency. Yes, there are loons on the Left; but sheer honesty compels us to admit that the Right, especially Fox news, is completely out of control. Yes, Dems play partisan politics; but the current environment of automatic filibuster and non-negotiation is unprecedented.

“And yet the media, which tries so hard to paint OWS as ugly, refuses to show history: that Republicans are acting ahistorically obstructionist, that the wealth gap is ahistorically large, that the rejection of science and embrace of religion by politicans is ahistorically pointed. We are in a period of truly frightening change, and all of it is coming from one side of the line.

“Despite OWS, we can't expect more than 50% of young people to bother to vote. Despite OWS, we can't expect anybody to understand bank regulation or support it. Despite everything that has happened, the American electorate simply can't be bothered to pay attention, learn a little history, and vote.”

I am not entirely sure what Mr. Planck is referring to as the public media’s “meme of equivalency“. I admit that I do not spend hours rigorously scouring television and the internet everyday, tallying up the sentiment, but on the whole it appears to me that the public media is only becoming ever more partisan. In some cases, this no doubt reflects the genuine political sentiment of the owners and the editors of the media outlets in question. In other cases, it is probably just the natural outcome of the discovery that inflammatory positions are good for ratings. In any case, I have seen very little news coverage lately that implied the opposing parties in American politics were “equivalent”. I do take the position that they are equivalent, in some sense. So does Ralph Nader, in a somewhat different sense. There is a certain tendency among the more moderate media outlets to pretend that we are not in pivotal times, and that if you ignore the world and click the heels of your ruby slippers together three times you’ll be just fine. If this is what Mr. Planck has in mind, I would agree that some portion of the press has been deceitfully inattentive. Whatever one may feel about the state of the world, one may not rationally believe that we can settle back down into a state of inert material bliss in which smart people in high places will take care of everything. Economics and nature both have other ideas.

Unlike Mr. Planck, I really do see a sense in which the two great motive groups within American politics are essentially equivalent, though not necessarily similar. I choose my words carefully here. I say “motive groups” because there now appears to be considerable weakness in both formal political parties. Inevitably, I will have to over-generalize simply to be coherent, using the terms “right” and “left” as though they represented homogeneous groups – which neither term does.

I would distill the current aggregate position of the American right as follows:

America is in an economic and security crisis because of a weak president, a corrupt congress, and decades of failed liberal policies. We need to restore our economy by de-regulating business and reducing the tax burden on people who create jobs. We need to restore our standing in the world by getting tough, particularly with the enemies of Israel. We need to get back to our traditional values to stop the general rot of our culture. We have plenty of oil; the liberal environmentalists are all that stand between us and energy independence.

Alright, now let’s take this apart. For me, that last position is the most important and the most absurd, so we’ll start with that. Newt Gingrich and others have recently made the claim that the US not only has enough oil for itself, but enough to supply Europe as well. In reality, the US hit peak oil production in the early 1970’s and has been in a general decline ever since. Under the second Bush administration the US oil industry experienced the most favorable conditions imaginable: high prices, self-regulation, and massive subsidies. Yet oil production didn’t rise. Is it plausible that, in the most heavily explored region of the globe, we’ve now suddenly discovered oil we couldn’t find for the last four decades – and right before an election? No, it isn’t plausible. The politicians are simply jiggering the numbers as usual, counting all the theoretical oil reserves, and not the recoverable reserves. Since the real basis of economics in any modern industrial state is energy, this misconception is the linchpin for all the others. The real economy, the manufacture of real tangible wealth as opposed to the practice of inventing money out of thin air, cannot take place without energy consumption. Growth cannot take place without increasing energy consumption. The broadly acknowledged global peak production of oil is now several years behind us. Globally, we are now in something a bit worse than a zero-sum game. Until or unless someone finds a viable replacement for oil, we are in a declining game. Thus, none of the Reagan era thinking about just giving business a free hand can make any headway against the erratic but remorseless decline in liquid fuel supplies we can expect. Money left in the hands of the wealthy will probably do what it has done since the fall of 2008 – wait for favorable conditions that may never come again. In the mean time, all the trumped up jingoism does nothing but provide a conscience-saving veil to hide our ongoing efforts to control the world’s remaining oil reserves. If Bin Laden had never existed, we would have had to invent him soon. The minor resurgence in traditional values issues is, in part, is a genuine reaction to a culture which has grown nauseatingly decadent and valueless. It is also, in part, merely a na├»ve attempt to reclaim a half-remembered past when ordinary Americans were better off and more secure. On the whole, rather little about the worldview of the right is grounded in reality. It is bound to lead to disappointment, to put it very mildly.

Now let’s look at the current aggregate position of the American left:

American is in an economic crisis because of the greed of the ultra-rich and their Republican cronies. Our security crisis is the result of militarism and adventurism by Republicans, culminating in the second Bush administration. We need to help the poor, the unemployed, the underprivileged, and the immigrant population until such time as the crisis has passed and they can help themselves. We can do this by taking a fair share from the rich. We won’t need to worry about the rest of the world if we just show them what nice people we are. Our only significant cultural problem we have is the racism of the right . We might be running out of oil, but global warming is a bigger problem. Both will be solved by some combination of wind, solar, and biodiesel, which will also jump start the economy by producing new jobs.

Having taken the position that energy is the key issue on the table, I will start with that again. Wind, solar, biodiesel, et al, are lovely and useful things. We’ll see more of them in our future. To borrow a phrase from James Kunstler though, they “will not be enough to run Disney World, Walmart, and the interstate highway system.” The numbers don’t add up. You can’t have a liberal, middle-class, 20th century lifestyle on green energy any more than you can have a conservative, middle-class, 20th century lifestyle on non-recoverable oil. Neither Volvos nor Suburbans run on dreams. Nature never guaranteed us a perpetuation of the present -- only nicer. Likewise, while green energy will no doubt produce some number of new jobs, you cannot rebuild prosperity by making the energy sector more expensive and more labor intensive. Cheap oil was the magic of the industrial age. Without it, we are now in a completely different game. Given this reality, the dream of government riding to the rescue of ever growing numbers of unfortunates is simply untenable. Keynesian economics depend on periods of prosperity to restock the coffers of the treasury. If the depression goes on long enough, spurred by high energy costs and the high cost of the international competition for a variety or scarce resources, Keynesianism is thrown back on the fatal option of an inflationary monetary policy to pay its bills. It is painfully apparent that we’re already there, with the government creating money to make up for a revenue shortfall with no end in sight. The bitter irony is that inflation is the most regressive tax of all. The only people who prosper in inflationary times are people who own real, tangible assets (gold, land, capital equipment) – this is to say, predominately the rich. The poor may subsist for now on various “entitlements,” but they must also become ever more dependent on them, in an environment in which everyone’s dollar buys less and less. On the matter of foreign policy, it is true that the Bush administration undermined any affection the rest of the world might have had for the US, but we are now entering and era of global completion for dwindling resources -- which will not be decided by popularity in any case. The Arab world will not give up their remaining oil because we institute a Muslim outreach program, and neither will the Chinese give up their toe-hold on prosperity to make sure Americans can retain their lifestyle. As I’ve said, this is a whole new game. Taxing the rich of their increasingly devalued paper may or may not be justified, but it will not resolve the underlying problem of a shrinking economy. This is a political strategy, not an economic one.

To summarize, the left and the right share a common problem of having utopian delusions of endless and inevitable progress – they simply have delusions of different flavors. Personally, I’m not very interested in determining which unworkable fantasy is better than the other. They are equivalent insofar as neither is tenable.

On the matter of Mr. Planck’s lament that “Despite OWS, we can't expect more than 50% of young people to bother to vote,” I am compelled to ask – what encouragement did OWS ever give anyone to vote? OWS was, from its inception, an abrogation of the normal political process of voting. Their goal was never to elect people to represent them, but simply to blackmail the existing leadership into compliance by creating disorder. They may well be correct in this approach, given the corrupt condition of our public institutions, but it seems odd to even ask why they have not spawned voters and candidates. The Tea Party movement, whatever one thinks about it, must be admitted to have been far more focused on “getting out the vote.” OWS, a symptom of our decline, has no solutions to offer at all – not even untenable ones.


  1. You are correct - the media is becoming more partisan even while it commits itself to false equivalence. In effect the media says, "There is no objective truth: there is only their side and our side, and our duty is to show you both sides so you can pick one." An example is that the mainstream media tend to report that both Dems and Reps failed to pass a bill in Congress, even when the truth is one Dem and every single Rep voted against it.

    It is also true that OWS is so dysfunctional they aren't even trying to drive people to the voting booth. I just meant that despite the fact young people had energy and attention to protest, they don't actually have the sense to do anything useful (i.e. vote).

    I do agree with you that the hard realities of energy are the dominant themes of our times. And yes, the Left can be considered somewhat optimistic. Yet isn't it true that at least the Left is aware there is a problem? While the Right (particularly represented by the Tea Party) actively embraces a denialist fantasy. These two positions are not equal; they are not equivalent. Both are short of the truth, but one is far shorter than the other. Based on this, shouldn't you find more common cause with Lefties than with the Tea Party?

    Saying "a pox on both their houses" is exactly the false equivalence I was talking about. One side is amenable to a solution; the other is not. Sheer responsibility requires one to work with the side most likely to reach a reasonable conclusion.

    As member of a nation far more socialist than America ever was, I have to say that the notion that the poor become "dependent" on entitlements is just not true. Massive government programs to transfer wealth from the "producers" to the "consumers" actually results in greater wealth for both classes (as America's own history shows). Ongoing investments in quality of life for poor people pays off in dividends less obvious than tax receipts, but no less tangible. There is a reason average life expectancy, crime rates, and citizen participation are lower in America than in social democracies.

    And finally, the entire notion of the "producer" class is bullshit. It always has been, but when the ruling class was making cars and televisions it wasn't obvious. Now that the ruling class makes its money by finance, it should be patently clear just how much their so-called "production" is really mere rules-fixing. It is perfectly possible to reward and encourage geniuses for their efforts while still paying society its fair share (keep in mind that not one of these geniuses would be worth diddly squat if they had been born in Somalia). It is so possible that America did it for 50 years. It was only the advent of Reganomics that broke the back of the middle-class.

    So yes, we have hard times ahead: but the Tea Party's dream of a simpler time is not helping, nor is the Randian fantasy of John Galt. What we need is a strong social commitment to reducing energy use and sharing dwindling supplies fairly while relentlessly searching for replacements. This is a state of affairs that can only be achieved by government. It is simply beyond the free market's ability.

    Should we be concerned about surrendering so much power to the government? Of course, but the alternatives - power to corporations and failure to address the issue - is worse. It does one no good to be free if it just means the freedom to starve.

  2. Re: MCP’s response

    There is too much here to answer in a short time, but I will try to address the most relevant points.

    I will not attempt to defend the right’s absurdist notion of energy independence at the current rate of consumption. On the other hand, to say the left, as a group, really understands the problem is simply false. In my experience, some of them are dimly aware of it – but they tend to see it as something easily solved with wind, solar, and French fry grease. They are no more willing to give up their lifestyles than the right. Even the few who are, living on their gardens and self-righteously pedaling to their university jobs, don’t seem to understand that their lifestyle isn’t scalable to mega cities or, really, to most modern nations dependent of fossil fuels. They have their narrative – don’t disturb them with the math. Thus, they simply want to stop all fossil fuel development now, and it never seems to occur to them than this means real people will eventually get to freeze or starve.

    Neither side is amenable to a solution. I deny the dilemma. One does not have to choose from two irrational positions. If anyone solves, or more likely merely attenuates, the energy situation they will have to repudiate both camps to do so. Failing this, nature will solve the problem for us.

    The relative merits of social democracies is a topic in itself, however your denial that the poor do not become dependent on entitlement is not supported. I can cite nummerous instances in which they have, but I don’t care to argue the point any further here.

    The denial of the existence of a “producer class” is a straw man. I did not use this phrase, nor would I. You do not seem to be arguing with me, so much as you are arguing with Fox’s John Stossel. I will note, though, that while you rail against the term “producer class” you use the term “ruling class” unflinchingly, as though you were talking about some dark, homogenous, conspiratorial body. The left does not seem prepared to single out the investment bankers, most of whom are intimately connected with the US Federal Reserve. Rather, it is easier to throw the net over everyone who makes more than a certain threshold of income, whether they are producers, employers, or merely well-dressed thieves.

    I would agree that market forces will not fix the energy situation. Our government, as presently constituted, will not fix it either. Both parties refuse to even discuss it honestly, the ghost of Jimmy Carter’s “malaise” speech no doubt prominent in their minds. I tend to agree with Kunstler – these things will get worked out locally once the centralized authorities, both Federal and corporate, become impotent under their own dead weight.