Frank Stilwell in Sustaining What? at Overland says that an emissions trading policy, which is the central response to climate change by western governments, has its roots in orthodox neoclassical economic theory. He says that:
According to that orthodoxy, if a limit is set on the total volume of carbon emissions and if the restricted number of permits to pollute are traded in the market, then the permits will be acquired by the businesses with the greatest need to pollute and the greatest ability to pay for doing so. The prices of goods and services will rise to the extent to which the purchase of emissions trading permits adds to their costs of production. Products whose manufacture and supply requires the burning of fossil fuel will become significantly more expensive. Aluminium is a case in point, because its manufacture involves enormous amounts of electricity, typically produced in Australia by burning coal. Proponents of emission trading argue that, if aluminum products become more expensive, consumers will switch to buying cheaper, less environmentally degrading alternatives.
Stilwell adds that selling the environment in order to save it’ is a strange principle. It does not recognise that the more fundamental problem associated with capitalism as an expansionary economic system is that the extension of markets created the environmental stresses in the first place. It is a kind of ‘fine-tuning’ that leaves the underlying orientation towards relentless profit-driven economic expansion unchanged.
Ali Muhammad Rizvi in Foucault and Capitalist Rationality: A Reconstruction builds on the insights of the governmentality theorists about a liberal mode of governance ( a history of the present) to reconstruct Foucault’s understanding of capitalist rationality. He says that the originality of Foucault’s analysis lies in his realisation that capitalism manages individuals and populations (primarily) through freedom and not (primarily) through repression.
Rizvi says:
It is normally understood that Foucault studies the strategies of the accumulation of men as the function of the problem of governance but what is seldom understood is that Foucault treats the problem of governance not in isolation but in relationship to the problem of the accumulation of capital. The problem is not just the governance but the type of governance that provides the space in which hindrances to capital accumulation are the least while its possibilities are being utilised to the maximum. Thus the problem is not just one of producing docile bodies but one of producing docile bodies which are also useful. The purpose of producing docility is to maximise utility. The type of docility that hampers utility is unacceptable. Therefore the problem of governance in Foucault is the problem of the governance for capital accumulation (and for nothing else).
It is not the case that there is one system for the production of docility - of governance and there is another system for the production of utility - of capital, which are then correlated and reinforce each other. Prior to this and as the condition of the possibility of this correlation and reinforcement, there exists, so to speak, a primordial order which is at once the way of governance and capital accumulation.... The polity in capitalist order is already a capitalist polity.In a capitalist system both polity and economy are geared towards the singular aim of simultaneously producing utility and docility. The polity and economy are equally productive in a capitalist order.
He adds:
The apparent paradox of capitalism is that in order to increase the utility and productive capacity of individuals and populations it requires continuous expansion in the ambit of freedom and diversity. But in order to make individuals docile and hence governable, it needs to limit this diversity. It is on the maintenance of this delicate balance between diversity and singularity that the sustenance and continuity of the whole capitalist system rests. Curbing freedom and diversity would decrease utility and productivity and hence slow down the motor of production and innovation on whose ever-increasing speed the legitimacy of the whole system depends. On the other hand expansion in the ambit of freedom and diversity to the extent that it becomes untraceable to a singularity would de-link diversity from capital accumulation. It would become ungovernable (hence creating a crisis of governance) in the sense that it would no longer be a capitalist governance i.e. governance for capital accumulation. (and it alone)
David Bromwich in America's Wars at Tom Dispatch argues that war has become the normal state of things rather than an aberration. The language is one threats, wars, conflicts, decades, tomorrows wars.
A new-modeled usage has been brought into English to ease the change of view. In the language of think-tank papers and journalistic profiles over the past two years, one finds a strange conceit beginning to be presented as matter-of-fact: namely the plausibility of the U.S. mapping with forethought a string of wars.....weird prospect that this usage -- "tomorrow's wars" -- renders routine is that we anticipate a good many wars in the near future. We are the ascendant democracy, the exceptional nation in the world of nations. To fight wars is our destiny and our duty. Thus the word "wars" -- increasingly in the plural -- is becoming the common way we identify not just the wars we are fighting now but all the wars we expect to fight.
The future wars of choice for the Defense Department appear to be wars of heavy bombing and light-to-medium occupation. The weapons will be drones in the sky and the soldiers will be, as far as possible, special forces operatives charged with executing "black ops" from village to village and tribe to tribe. It seems improbable that such wars -- which will require free passage over sovereign states for the Army, Marines, and Air Force, and the suppression of native resistance to occupation -- can long be pursued without de facto reliance on regime change. Only a puppet government can be thoroughly trusted to act against its own people in support of a foreign power.
In this review of Mark R. Levin's Liberty and Tyranny A Conservative Manifesto Peter Berkowitz makes some good points. He says that Levin's conservatism puts liberty first while respecting the claims of faith and traditional morality.
Like Goldwater's, Levin argues that liberty and tradition are mutually supportive: Faith and traditional morality educate citizens for liberty, and liberty provides the best protection for faith and traditional morality against the major threat to them, encroaching government power. And like Goldwater, Levin greatly understates the conflict between liberty and tradition: Freedom encourages impatience with (and skepticism of) inherited authority and custom; tradition generates impatience with (and skepticism of) innovation, novelty, and diversity.
Berkowitz says that Levin observes that the market generates what Joseph Schumpeter called "creative destruction," the process by which capitalism's endless innovation and entrepreneurship constantly give birth to new products and companies and render others obsolete and ruin them. However, Levin only brings up the market's destabilizing power to criticize efforts by the statist left to eliminate through law the uncertainty and hardship inherent in capitalism.Berkowitz says:
As Irving Kristol, Daniel Bell, and George Will (among others) have pointed out, capitalism also creates significant problems for conservatism. Its churning change erodes the traditional beliefs, practices, and institutions that the conservative rightly sees as essential to moral education in a free society. Because both liberty and tradition are good, because each provides the other crucial support, and because at the same time they often reflect opposing impulses and issue contradictory demands, the conservative, who cherishes both, is constantly called upon to strike a prudent balance between them, or exercise moderation.
Slavoj Žižek in his article on authoritarian capitalism at the London Review of Books says that:
It is democracy’s authentic potential that is losing ground with the rise of authoritarian capitalism, whose tentacles are coming closer and closer to the West. The change always takes place in accordance with a country’s values: Putin’s capitalism with ‘Russian values’ (the brutal display of power), Berlusconi’s capitalism with ‘Italian values’ (comical posturing). Both Putin and Berlusconi rule in democracies which are gradually being reduced to an empty shell, and, in spite of the rapidly worsening economic situation, they both enjoy popular support (more than two-thirds of the electorate).
Žižek says that Berlusconi is a significant figure, and Italy an experimental laboratory where our future is being worked out. If our political choice is between permissive-liberal technocratism and fundamentalist populism, Berlusconi’s great achievement has been to reconcile the two, to embody both at the same time.
Surveillance and Society is aptly named given the turn to the ‘top-down’ forms of monitoring and surveillance--- of employees by employers and citizens by the state---in liberal democracies. This normalisation of camera surveillance on the streets of Australia, the UK and the US is coupled with the rejection of concerns about the invasions of privacy cares as outmoded arguments by civil libertarians in the name of we need to feel safe and secure.
The press have played a central role in legitimating the visual surveillance of human behaviour in public space. The press does this by “representing order” (social control) through discourses of ‘safety’ and ‘quality of life’ that are a central foundation for the power and practice of urban development and growth under a neo-liberal mode of governance.
Roy Coleman says that:
As a process of ‘creative destruction’, neoliberalism has been destructive of forms of welfare provision, regulation of financial and monetary speculation, forms of targeted public funding and certain rights and social entitlements. At the same time it has produced “moments of creation”, including the building of free trade zones; and privatised spaces for high earner consumption; the unleashing of zero tolerance initiatives and targeted surveillance; and the development of powerful and insidious discourses aiming to re-image cities within a vernacular of “renaissance”.
Coleman says:
Firstly, through the eye of a street camera a host of urban social problems; including popular protest, homelessness, street trading and petty violations to local byelaw become detached from any social context, and instead defined through the lens of rime and disorder. Secondly, what is most obvious and yet often unacknowledged is that cameras overwhelmingly focus on the street and ‘street people’. This reinforces prevailing definitions of ‘crime’, ‘risk’, ‘and ‘harm’ as emanating solely from powerless and ‘disaffected’
people.
A group of economists: (Joshua Gans, Nicholas Gruen, Christoper Joye, Stephen King, Sam Wylie and John Quiggin) have issued a statement calling from a comprehensive inquiry into the financial system.
Joshua Gans, Nicholas Gruen, Christopher Joye, Stephen King, John Quiggin and Sam Wylie
Ever since the severe market failures in Australia’s securitisation industry were identified in 2008, we have been concerned that these problems were partly attributable to more fundamental flaws in Australia’s ageing regulatory architecture and the inadequately defined role of government in dealing with such crises.
The shortcomings within our governance system have been exacerbated by the relentless changes that have occurred in financial markets since the essential elements of our regulatory infrastructure were put in place decades ago. One example of this is the 1996 Wallis Inquiry’s rejection of the use of deposit guarantees, which have been critical tools for maintaining stability during the current crisis. Following the lessons that have been learned during the global financial crisis, and the 12 years that have elapsed since the last such exercise, we believe that a broad-based inquiry into the integrity of Australia’s financial system is now warranted.
While the $40-50 billion per annum residential mortgage-backed securities (RMBS) market supplied the funding for up to a quarter of all Australian home loans it did so with little-to-no government oversight or support. The growing depth and liquidity of this market enabled the emergence of significant alternatives to the major banks in the form of empowered regional banks and building societies, and smaller non-bank lenders. When this market disappeared due to an entirely external shock—the US sub-prime crisis—many of these institutions were brought to the brink of collapse and forced to withdraw from lending altogether or merge with competitors. At least one smaller Australian bank would likely have failed had it not done so.
The biggest beneficiaries of this chaos have been the four major banks that receive the most favourable regulatory treatment under the existing system, which was not conceived with many of their smaller rivals, and the new markets that they rely on, in mind. Yet the forced ‘reintermediation’ of the major banks into the residential lending arena has had other unintended effects, with the pressure placed on their balance-sheets in turn compelling them to ration credit to the higher risk small business, corporate, and commercial property sectors.
We are still in the midst of understanding the consequences of the global financial crisis and the actions of governments (including Australia’s) in response to it. Importantly, it remains uncertain to what degree Australia’s comparatively successful performance in navigating through this catastrophe has been due to our own regulatory foresight or just good luck. We would do well not to discount the possibility that a ‘good roll of the dice’ left us without more significant system failures such as those seen in the UK. In future crises, we may not be so lucky.
This cataclysm was imposed upon us by the increasingly interconnected and globalised nature of capital markets. These interdependencies also extend to government policy. The catalytic event that was US sub-prime borrowers defaulting on home loans that barely exist in Australia pushed the world into a deep recession and has subjected Australia to a marked slowdown accompanied by significant job losses. As a nation with a large foreign debt that has continually increased its liabilities via enormous current account deficits, Australia’s vulnerability to foreign shocks is in many respects greater than most of our peers.
It is, therefore, critical that policymakers take this opportunity to thoroughly review the existing system and evaluate whether changes need to be made to it. Although the dependence of financial institutions on national governments has been reinforced by the crisis, global capital market integration is not going away. We have little comprehension of the consequences of the raft of new policies that are being implemented by other nation states. What effect will the whole or partial nationalisation of banking systems around the world have on Australian institutions and, more specifically, our ability to source foreign credit? Will the UK Government’s recent decision to guarantee securitised home loans along the lines of the Canadian model place Australian lenders at a competitive disadvantage in a global capital raising context? What are the long-term ramifications for Australia of the new regulatory regime being instituted by the Obama Administration?
These linkages cannot be ignored and should be examined under the auspices of a first-principles system review process similar to that undertaken by Campbell in 1981 and Wallis in 1996 with the benefit of new insights.
If there is any doubt as to why Australia needs to urgently revisit the foundations of its financial architecture, and evaluate what renovations might be required in light of the current crisis, consider that the following questions remain unanswered:
· Will the Australian government seek to establish a regulated clearinghouse for the hundreds of billions of dollars worth of over-the-counter derivatives contracts that are otherwise beyond the remit of policymakers;
· Should banks be subject to a ‘systemic capital charge’ to account for the risks associated with the correlation between bank balance sheets given that current capital charges reflect the idiosyncratic risks to the institution itself, and may not be collectively large enough to compensate for system-wide catastrophes;
· Will the deposit and/or wholesale funding guarantees be phased out and, if so, what new policy guidelines will explain how they might be redeployed when capital markets seize up again in a manner that minimises disruptions to other sectors (such as the knock-on effects seen in non-guaranteed areas like the commercial paper debt markets, the mortgage trust industry, and the CMBS and RMBS markets). If they are not phased out, how will the terms and price of these subsidies be determined and what regulatory constraints will be applied to prevent the emergence of moral hazard risks. More broadly, what parts of the credit markets will or will not be guaranteed in the future;
· Should APRA impose ‘automatic stablisers’ that require banks to accumulate capital in good times to serve as insurance against the bad;
· Has this crisis reminded us that Australia’s major banks fulfill a unique community role akin to public-private utilities that warrant special controls to guard against system stability risks? Here it is odd that we’ve been repeatedly told that our banks were lucky not to have had substantial overseas exposures and yet they now appear to be rushing offshore to obtain exactly these;
· What new regulations will govern executive compensation at banks and securities firms to mitigate the ‘call-option’ like payoffs that have tainted these arrangements in the past and how might these be tied to prudential supervision (eg, higher risk-weightings for firms that have short-termist structures and/or claw-backs on remuneration for executive negligence and adventurism);
· Can real competition emerge while consumers face significant costs in switching between financial institutions? Does a government-regulated securitisation market provide an opportunity to consolidate mortgage account standards and more effectively enable switching;
· Where government guarantees are deemed necessary is it preferable for them to be offered against complex institutions like banks, or against tangible portfolios of assets the characteristics of which can be relatively easily assessed by independent experts;
· Should citizens who feel unsure and unqualified to shop wisely in our financial markets be able to access basic savings, payments, and wealth management products that have been vouchsafed by governments as being safe and professionally managed (eg, why can’t Australians invest with the Future Fund)? In this regard, is there a role for a publicly-owned entity, akin to KiwiBank in New Zealand, to offer essential services in Australia’s finance sector that leverage off unique government infrastructure (eg, Australia Post, the tax system, and the government bond market);
· How will policymakers remedy the regulatory asymmetry between institutions like the larger banks that rely on short-term retail deposits as their primary source of funding (in combination with wholesale debt) and many of their competitors that depend on the longer-term and (ironically) ‘matched’ funding furnished by the RMBS market? Whereas banks benefit from a range of government subsidies (implicit and explicit deposit guarantees, term funding guarantees, RBA liquidity support, etc), which glue together the enormous asset-liability mismatch created by funding 30 year loans with at-call deposits, Australia’s regulatory architecture does nothing to maintain the liquidity and integrity of its securitisation market. This contrasts with the Canadian system, which has remained open and functional throughout the crisis (and displayed lower default rates than Australia);
· Should the RBA ‘lean against’ incipient asset-price booms fuelled by increases in system-wide leverage;
· Should Australia’s global foreign debt position be the subject of any general policy oversight and, if so, what measures should be pursued to ensure that these exposures are prudent;
· What position should Australia take in relation to the restructuring of the global financial architecture? This will begin in earnest once it is clear that the worst of the crisis has passed. We need to be prepared for the negotiations that lead to new organisations, treaties and the global regulation of finance. For example, European states appear to favour a global super-regulatory body. The US has not embraced this approach. Where should Australia stand? And what will Australia’s views be on other key issues, such as the uniform global reform and regulation of rating agencies and hedge funds; and finally
· What does Australia want to achieve from trade negotiations relating to the opening of foreign financial systems to overseas firms? Australia should be able to expand its supply of global financial services because of its location, political stability, resilient financial infrastructure, skilled workforce and competitive institutions. What steps will be taken to optimise Australia’s ability to both import and export financial services?
These are but a small subset of the many profound policy questions facing Australia and its financial system. Our relatively strong economic position offers an opportunity to review, investigate, consolidate and reform (if necessary). We need to take active steps to avoid the temptation of complacency and accept the lure of challenge. Only a full-scale independent commission on the financial system—roots and branch—can put us on a path to continued stability and insulation against the unpredictable. Following in the footsteps of Campbell in 1981 and Wallis in 1996, such a review’s time has now come.
This is via infinite thought
This piece is copyright-free. Please distribute widely.
In the past two weeks, the majority of people in Tehran and other cities in Iran (including Shiraz, Ahwaz, Tabriz, Isfihan) have been on the streets, protesting against the theft of the presidential election by a handful of state’s agents at the top level. It was not a rigging in the usual western sense, no added votes or replaced ballot boxes, the election went on properly, the votes were taken and probably even counted, the figures transmitted to the ministry of interior, and it was there that they were totally disregarded and replaced by totally fictitious figures. That is why all the opposition forces (Sazman-e-Mojahedin-e-Enghelab, Mosharekat party...) together with people called it a coup d’état.
Global public opinion and, especially, the body of (leftist) intellectuals, Inspired by recent events in the middle Asia and east Europe, mostly regard this Iranian mass protest as another version of the well-known, newly invented, neo-liberal, U.S.-sponsored, colour-coded revolutions, as in Georgia and Ukraine. But is it the case in Iran? This article intends to clarify the issue, to reveal the properly political essence of current mass movement, and to demonstrate that this movement has the potentiality of a self-transcendence, of surpassing its actual demands, of traversing its current phantasy. To do this, we shall first examine the contemporary tradition of radical politics in Iran. Without these references, the current movement, which truly deserves this title, can not be understood correctly.
People, whether consciously or not, are frequently recollecting the 1979 Revolution and the 1997 Reform Movement. Many of their slogans are transformed slogans of the '79 Revolution. The paths of demonstrations are symbolically significantly, the same as those against Shah. But this does not mean that people are imitating the '79 Revolution: there are many new possibilities and creativities, many formal and thematic inventions. As for the 1997 Reform Movement, and its aftermath (the crushing of student protest in 1999), the affinities are even more obvious. Khatami, along with Mir Hossein Mousavi, is one of the most significant leaders and supporters of the protest. It is as if people are trying to redeem the 2nd of Khordad (May 23, 1997), to revive the unfinished hopes and dreams of those days. But this time, the protest is by no means limited to students and intellectuals. Although Khatami in 1997 was elected with 20 million votes from the most varied sections of the nation, the movement was characterized by the political and cultural demands of the middle-class, of students and educated people. But, apart from this, what is the true significance of the 2nd of Khordad Front for politics in Iran?
On the 2nd of Khordad, for the first time since Iranian Revolution, we were encountering a dichotomy between the state and the total system of Islamic Republic of Iran, known as Nezam (System, which is based on the principle of Velayat-e-Faghih, the supreme authority of high-ranked Mullahs). This duality was partly due to the fact that the leader of the opposition, Khatami, was at the same time the chief of the state. It was the only occasion where this duality, which is, in a sense, one between the development of productive forces and cultural, political backwardness, between secular democracy and religious fanaticism, could be revealed. Before and after that period, the state and Nezam have been basically in accordance, as it had been in the Shah's Regime. One of the reasons, if not the main reason, why elections in Iran are of such importance for democratic movements, despite trends to boycott them, lies precisely in the significance of this very duality. Seen from a classical-Marxist perspective, in order to pave the way for the development of productive forces, in order to accomplish the ‘civilizing mission’ of capitalism, there must emerge a bourgeois state capable of carrying out the process of democratization and modernization. Whenever the state has been in full accordance with Nezam, this process fails to go on.
Besides this, we deal with yet another duality, one between the capital and the state, the former as the means of development (with all its discontents, aptly and righteously exposed by the Marxist tradition), and the latter as the organ of regression and anti-modernism. So, the progressive and socialist opposition in Iran are faced with the unprecedented, hard task of fighting in two fronts: against religious fanaticism and the authoritarian factions in a semi-democratic government, and simultaneously against global capitalism and its hegemony by means of the production of wars. In a sense, intelligentsia in Iran are very similar to that of Russia and Germany of 19th century. We are a handful of schizophrenics who are, at one and the same time, against and for progress, development, capitalism, state management and so on. In other words, for us, the Faustian problematic, his tragedy, is formulated in a typically Hamletian way.
This ambivalent attitude (to western civilization) can be characterized by the dialectic of state and politics. We are neither dealing with a pure politics a la Alain Badiou, nor with a classical Marxist politics, exhausted in class struggles, nor with the liberal-democratic politics of human rights, which was, by the way, the dominant discourse of opposition in Iran before Mousavi. Our supposedly radical politics consists of every one of these elements, but is not reducible to any of them. To deploy Agamben’s terminology, it is a politics of people against People, i.e. voiceless, suppressed people, against People officially constructed by the state. The current movement materializes, in many respects, this very politics.
But the question, which has confused the western (left) intelligentsia and has caused the most varied misunderstandings regarding Iran, is whether Ahmadinejad is a leftist, anti-imperialist, anti-privatization, anti-globalization figure. The common answer is a positive one. That is why certain misguided western leftists tend to regard the current mass movement in support of Mir Hossein Mousavi and against Ahmadinejad as the struggle of liberalism against anti-imperialism, of privatization, liberal-democracy against the enemies of global hegemony of America.
The main aim of this article is to expose, to expel this widespread illusion. As regards the other confused camp, the Western, more or less, Islamophobic liberals, who are inclined to identify Ahmadinjad with Al-Qaeda, who refer to Mousavi, because of his Islamic-Republican career in 80’s, as another version of Islamic, anti-democratic Ideology, one could say that they too are caught up in an illusion based on easy Euro-centrist generalizations and lack of familiarity with the Iranian historical context. We should thus answer the simple question: what is actually at the stake? Apart from the triad of French Revolution, the triad of modern emancipatory politics, liberty, equality, fraternity, one could maintain that the main bone of contention in this struggle is precisely politics itself, its life and survival. Our government is called the Islamic Republic of Iran. Now the republican moment, which has always been downgraded by the conservatives, is presently being annihilated. It is precisely through this very outlet that any popular politics, from social movement of dissent and class politics to the defence of human rights, might survive.
Another common approach, no matter how radical, supportive, or conservative, to mass protest in Iran is the following: it is a youth movement, at its best, similar to 68’s student protests. New young generation in Iran, armed with Internet, socialized by social networking sites, tired of Islamic ideology, has awakened, claiming its own way of life, and so on. According to this attitude, which is evoked by a number of journalists, it is only the middle-class intellectuals, students, feminists, and other educated people in large cities who are rallying on the streets, communicating with each other thanks to the internet. What is striking is that the state discourse in Iran widely promotes this very attitude. The ruling elite, based on a populist rhetoric, tends to single out a certain section of the nation and call it the People. The state television, Seda-va-Sima, is the main place where this People is represented, indeed constructed, mostly through the usual populist tactic of one nation versus the evil external enemy who is the cause of all trouble. It presents a unified, pure, integrated image of People, all devoting themselves to Nezam, all law-abiding, religious, etc. This image of People is daily imposed on the masses and inscribed onto the body politic.
Against this formally constructed People, with the state as its formal face, there has come out another people, a subaltern, muted people, claiming its own place, its own part in the political scene. June 2009 Election was a decisive opportunity for this people to declare itself, in the figure of Mousavi, who from the beginning insisted on people’s dignity as a true political right. But why him? Why not, say, Karroubi, the other reformist candidate? Has Mousvai, now the leader of the mass movement, appeared on the scene in a purely contingent way? Has he by mere chance, by force of circumstances, as it were, become the leading figure, the reform-freedom-democracy incarnate? The answer is positively negative. To elucidate this, we have to draw attention to the tradition from which he has emerged and to which he has repeatedly referred during his electoral campaign. As we said before, this tradition is rooted in 1979 Revolution and has been revived in the 2th of Khordad Movement -- whereas, Karroubi’s ‘politics’ was based on a subjectless process in which different identity groups would present their demands to the almighty state and act as its passive, divided, depoliticized supporters. In fact, Karroubi’s campaign, with its appeal to Western media, using the word ‘change’ in English, and profiting from celebrity figures, was the one that could be called a Western liberal human-rights-loving, even pro-capitalist movement. The fact that millions transcending their identity and immediate interests joined a typically universal militant politics by risking their lives in defence of Mousavi and their dignity, should be enough to cast out all doubts or misguided pseudo-leftist dogmas.
Morad Farhadpour and Omid Mehrgan [translators and philosophers based in Tehran]