Category Archives: Economy

Alas, Poor Uncle Sam

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. . . I knew him, Horacio — a fellow of infinite jest… Where be your gibes now? your gambols? your songs?

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Mariner has become frayed and disillusioned wandering the foxholes and ditches of daily politics, economics and social conflict. It reminds him of those old news videos of doughboys running in the trenches of World War I. Mariner searches desperately for reason, cohesiveness and purpose.

Alas, the trenches of Somme are the nation’s reality. Cash replaces tear gas; international trade replaces cannon fodder; political dialogue replaces machine guns; technology replaces bombs and strafing. And now an accelerant, Covid-19, has introduced the urgency of a raging forest fire.

Not only is shelter-in-place an urgent pragmatism, it is a metaphor for our times; it is our trench.

Meanwhile, out on the battlefield, Covid-19 has expedited cultural change. It has made space for artificial intelligence to rush in and set new standards. It has disrupted political change from an incompetent form of democracy to one that relates to the battlefield. It has destroyed the nation’s economy.

More than a million soldiers were killed or wounded on the fields of Somme representing seven nations. It was brutally personal. Currently in the United States 23,000 citizens have died and the plague is still progressing. It is brutally personal.

Subtly, a new force has joined the war: global warming. As today’s global war of change fights its way into the future, as small steps of stability are put in place, global warming will attack across all fronts – politics, economics and society. Global warming will introduce a new dimension of destruction just as the atomic bomb did at Hiroshima and Nagasaki.

In the United States today, political smoke fills the air, explosions erupt in the halls of government and reason dies under attack from greed, prejudice and moral decline. Yet, no different than the Battle of Somme, this time of great, historical change must continue to be fought. It is not nation against nation so much as it is faction against faction. It is the wealthy against the poor, the average, the good of all; it is the plutocracy of government fatally infected with cash and privilege; it is corporate America flushed with opportunity to monopolize society; it is data technology that will erase the idiosyncrasy of each citizen while all around this war the biosphere dies more rapidly every day.

Will reason, cohesiveness and purpose ever again exist? Will humanity survive? Is all this commotion part of the Sixth Extinction?

Ancient Mariner

 

Business and cultural survival

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Mariner has highlighted a broad concern about the virus spinoff of big data corporations to use their endless clouds of tracking, identifying and profiling individuals to diminish privacy and security. Willingly, as ‘good fellows,’ they have offered their immense, person-identified databases to government agencies to help track the virus. Many editors and journalists have said, in so many words, ‘we will never get this snake back in the bag.’

This same phenomenon applies to the economy. Private equity firms, corporations, banks and investment firms will benefit from government handouts because the emergency legislation has profit loopholes in its wording. The Economist Magazine made this issue their lead story in this week’s addition. Mariner quotes the relevant section below:

“Don’t go from crisis to stasis

The last long-term shift is less certain and more unwelcome: a further rise in corporate concentration and cronyism, as government cash floods the private sector and big firms grow even more dominant. Already, two-thirds of American industries have become more concentrated since the 1990s, sapping the economy’s vitality. Now some powerful bosses are heralding a new era of co-operation between politicians and big businesses—especially those on the ever-expanding list of firms that are considered “strategic”. Voters, consumers and investors should fight this idea since it will mean more graft, less competition and slower economic growth. Like all crises the covid-19 calamity will pass and in time a fresh wave of business energy will be unleashed. Far better if this is not muffled by permanently supersized government and a new oligarchy of well-connected firms.”

Referencing mariner’s last post, corporatism is a form of authoritarianism.

Ancient Mariner

Welcome to the underbelly

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Speaking quite generally but based on intrinsic differences, a direction of cash flow can be determined for each economic philosophy. In times of duress, for example Covid-19, the Great Depression and the collapse of the Soviet Union, the direction of cash flow is clearly visible.

Capitalism. The cash flow is always upward toward the core wealth of the economy. If suddenly cash flow ceases, it will not deter the upward flow – it simply will slow down. The end result is those at the bottom have little if any cash because what’s left of the flow is always toward the core wealth of the economy. In other words, if a citizen has no means to generate cash, that person is dispensable; nothing is owed to them.

Socialism. The cash flow is circular. The core wealth of the economy is always in flux. The end result is that no one can truly tilt the flow toward them so they can be unendingly wealthy. On the other hand, the extraordinary political power that can emerge from the inordinately wealthy is not available in a socialist economy. As well, no citizen is limited in his worth because he does not contribute to the flow of cash.

Communism. The cash flow is similar to the ocean tide. It moves in and out according to the overall moment in history. Ebb and flow is not a good way to run an economy; it is difficult to generate economic flow to purposefully produce economic leverage. Everyone suffers the moment together – good or bad. A common repair is to move toward authoritarianism. Note China in the last century.

Authoritarianism. This includes any form of dictatorship, monarchy or its clubby version, plutocracy of which corporatism is a subset. Cash flow is not toward the core wealth as it is in capitalism; it is an extraction of wealth from the economy altogether. Eventually, there is not enough cash flow across the economy as a whole and national bankruptcy ensues. Note the state of oil-rich Venezuela.

The way to test which direction cash flows is to introduce a great calamity, for example, a worldwide pandemic. In the US, public sources of cash flow have stopped. No rent, no restaurant, no transportation, no mortgage, no factories, etc. The reader should note that the relative impact between holders of labor income and those holding the core wealth is not a similar experience. Hence, cash flow moves upward. The US must be a capitalist nation.

Ancient Mariner

 

A nation divided . . .

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A bill has been introduced in Congress to make Chicago the 51st state. Illinois is one of many states where one or more very large cities, like Chicago, dominate state politics. Mariner lives near the Illinois line and he knows downstate Illinois is no Chicago! It is classic conservative versus liberal, rural versus urban, agriculture versus manufacturing, republican versus democrat. The situation in Illinois is how Donald can brag he won Illinois because he won 90 counties out of 102. Donald does not mention that he lost Illinois to Hillary 5 to 3 in the popular vote.

By party affiliation Illinois is the third most democratic state in the Union behind New York and California. Converting the state from counties to districts which directly affects representation to the Electoral College, there are 18 congressional districts plus two at large for a total of 20. As it turned out, Hillary took all 20 because Illinois is one of those states that require all Electoral College representatives to represent the popular vote. However, seven of those districts were won by Donald. Many states do not follow Illinois’ interpretation and allow each district to represent its own vote. This is how Donald won the Electoral College in 2016.

So much for statistics. The real issue is a split society. These circumstances remind mariner of Ancient Greece during the era of city-states; it reminds him of the south versus the north in 1860; it reminds him of the generational dichotomy during the 1960’s. Now, it is conflict between thinly populated, monolithic agricultural regions versus crowded, high tech, internet-linked, culturally diverse cities.

The latest news demonstrates the defensiveness between rural and city in that nine states refuse to participate in Covid-19 recommendations. Defiance in either culture is a dangerous sign.

The US, among many nations around the world, is confronted by the Big Four: Economy, Global Warming, Artificial Intelligence and Role of Government. But now for the US, there is a fifth: cultural bifurcation.

This situation literally forces the Republic’s governments and its citizens to take control of dysfunctional relationships between the cultures. Specifically, the relationships in disarray are:

Taxes, Senate representation of population, gerrymandering, term limits, Electoral College and plutocracy (money runs the government).

Coronavirus certainly picked a terrible time to join the battle.

Ancient Mariner

Gig Workers

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Why are gig workers striking? “The sharing economy is built on a risk shift from the companies onto the workers. As a result, the workers don’t have access to basic protections, and they don’t have the kind of power that we imagine even a Walmart worker has. I can’t imagine a starker power dynamic than the CEO of Uber, who has direct connections to everyone in Congress, and then a gig worker who can’t even get a low-level bureaucrat at Uber to answer his or her basic questions.” [Protocol Source Code]

Gig workers are workers whose employment relationship with their employers is temporary. The term ‘gig’ probably is best known by show business types saying, “I have a gig in Houston.” There are several conditions under which a person is hired temporarily but not as a full-fledged employee: construction, show business, clerical, consultant, instructor, and so forth.

Mariner is unusually aware of the gig life. For decades he was a gig worker – a systems consultant for operating system conversions. Except for an active market, his first gig could have been his last.

Specialized, in demand gig workers make decent salaries often well above the standard wage in their profession. On the other hand, their job security is short-lived and typical benefits are not available. Mariner has witnessed countless times when gig workers were required to take residence in the government jurisdiction that held their contract. They would sell their homes, move family, and adjust to new standards of living – only to be terminated months later when the winds of corporate finances changed.

A chimera gig worker is a worker who may appear to be normally employed, receive benefits and draw a standard paycheck. However, this worker is still a gig worker in that they are used sporadically, do not have union rights, and have no guarantee of being called to work. A substitute teacher (associate) is a common example.

For a creative person or one with exceptional skills or education, gig work can be an entertaining, well paid career. However, in times of economic uncertainty or great cultural shift, gig workers are the first to be dismissed.

The nation is in the midst of historic cultural and economic change. Gig workers may be the heroes who help adjust to the change but they also are the most expendable. There is no doubt that restructuring the job market in anticipation of artificial intelligence will take an unusually large gig force – temporarily. There needs to be a special unemployment structure for gig workers.

Ancient Mariner

Restricted to the compound

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֎ The ‘shelter in place’ has not affected mariner much. He mostly stays at home anyway. However, the garden season is fast approaching and mariner has begun to start many, well, too many projects for garden improvement; he has added organizing the basement and is adding more shelves in his workshop.

Focusing on the compound increases mariner’s awareness of small things. For example, he and his wife maintain a bird feeder outside the kitchen window. A large variety of birds, rodents, squirrels and rabbits are regular visitors. This draws predators as well. Mariner and his wife have seen a red tailed hawk swoop in to capture a small rodent, a large cat visits regularly and a fox was seen carrying a squirrel carcass.

Mariner’s town has had resident foxes the past few years which has kept the rabbit population low. Five years ago there were rabbits under every bush and rhubarb plant. One year he planted 40 perennials in a border; as they started to grow, they all disappeared in one night. In self-defense mariner now has a 117 gauge bb rifle at hand. Recently, the rabbits don’t visit very often thanks to the predators.

The other irritating creature is Japanese beetles. Mariner has advice for readers: don’t ever use beetle traps because every Japanese beetle in town will swarm to the reader’s garden. Mariner tried it once; he had to replace the little bag that comes with the trap with a 40-gallon trash bag. That bag weighed 23 pounds and mariner still had thousands of beetles in his apple trees, rosebushes, and shrubs.

֎ So much for mariner’s shut-in world. As the ‘shelter in place’ restriction and the accompanying crowd limitations spreads to significant portions of the United States, mariner is fascinated by the way social interaction changed. It’s as if the virus has forced society to do a training drill for how society will change as new concepts of economy emerge, how working from home will be a major aspect of jobs under artificial intelligence, as the retail world finally succumbs to online purchase and delivery and how active group experiences among friends, neighbors and extended families is adapting to Internet communication.

A new Skype-type product, ZOOM, is a fast rising software product. A full harmonic orchestra was able to play classical music together with ZOOM. Check it out with the reader’s search engine.

It is, however, a harrowing time. Pandemics have and will change the path of the future. Given the nation’s political conflicts, it is a good feeling to have everyone united for a common cause.

Ancient Mariner

 

The Twenty-first Century

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Has the reader ever tried to walk on a railroad rail? It seems easy enough but it isn’t long before most walkers fall off. Now imagine that the rail isn’t still; it is slithering like a snake slithers through grass. Add to this unstable situation the fact that it is snowing hard along with a stiff wind. Finally, there is no choice but to walk this rail all the way to the reader’s home two miles away.

Welcome to the twenty-first century.

There have been terrible life ending moments in Planet Earth’s history. For example, around 439 million years ago, 86% of life on Earth was wiped out in an event called the Ordovician–Silurian Extinction – the first of five global extinctions. The most recent extinction, the Cretaceous-Paleogene brought on the extinction of dinosaurs. A combination of volcanic activity, asteroid impact, and climate change effectively ended 76% of life on earth 65 million years ago. As noted, there have been five such extinctions. Mariner has cited Elizabeth Kolbert’s book ‘The Sixth Extinction’ in earlier posts. Elizabeth claims that this extinction already is occurring.

She likely is correct in her assumptions: The International Union for Conservation of Nature reported more than 800 animal and plant species have gone extinct in the past five centuries. Today there are nearly 17,000 threatened with extinction.

Like snow falling on a shifting rail, add the issue of global warming. The Ordovician–Silurian Extinction had a similar situation but in reverse; the Earth grew very cold.

– – – –

What else is new for the twenty-first century? Not much of significance has been added to the world of economics since John Maynard Keynes (floating dollar) and Milton Friedman (free market) contributed early in the last century. In the twenty-first century, the world needs something new; the world economy is beginning to stumble; most economists believe there will be a worldwide recession any time now. Everything from a shifting of population age to the disappearance of earthly resources (Helium, gypsum, indium and rare earth minerals, (the last a vital ingredient in smartphones, hybrid cars, wind turbines, computers, etc.) just to name a few.

Further, it may be theories of territory are the elephant in the room of economics, that is, nations. The speed of the Internet and the power of computers have warped the timeline of economics, often running over small nations, nations without competitive economies and nations with limited natural resources.

Something else affecting world economy is the disappearance of natural conditions like unused land, fresh water and climate control due to abuses with fossil fuels and disregard for the needs of nature (estuaries, breeding grounds, etc.).

– – – –

Hmmm, what else is new for the twenty-first century? Oh yes – artificial intelligence. Can humans handle all this new stuff for the new century: extinctions, failing economy, global warming and do it all with massive changes in culture as well? There’s no choice, home is still two miles away.

Just months ago David Brooks, a political/economic pundit on PBS News Hour, wrote “The Second Mountain” which suggests that the nuclear family is a disadvantaged unit in modern times. Shall everyone revisit polygamy or return to communes? David makes a valid point that nuclear families, especially at lower income levels, do not have enough income to sustain a happy, rewarding life – whether it’s a home, salary, transportation, health or education. A simple insight: how many minimum wage earners take a vacation to a pleasurable place? Could they if there were four or five wage earners in the family?

Multiply the challenge to the nuclear family by taking away 80 percent of the jobs that support these families. This situation alone calls for a new economic theory and it isn’t capitalism, corporatism or free market.

– – – –

How about human privacy? When mariner was a young adult, he spent time at an Atlantic coast city. He learned that the city knew how many visitors were in town by the amount of waste water discharged. In other words, population was counted by how many folks were flushing toilets. At least the city didn’t know specifically that it was mariner using the toilet. Today, they know. If corporations and insurance companies have their way, they will know mariner ate too much bacon today and skipped his walk. His health insurance will cost more and he will have to pay for another automatic delivery of bacon with money he never personally controlled.

Welcome to the twenty-first century.

Ancient Mariner

 

 

Sheltered

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It’s been a few days. Herding humans may be a lot like herding cats. Even in mariner’s household of two, the days are drawn out and have empty spots. It used to be before sheltering that in mariner’s retired family they had two or three trips to visit friends, attend meetings and other gatherings, and shop. This busyness has stopped, of course, leaving just a run to get groceries. What else has stopped is sports – all sports! What fills this empty time?

Communication must go on. Every social media site has had a notable increase in usage. So has porn, gaming, email, telephone, smartphone and picture telephone (Skype, Facetime et al). Siri and Alexa have started to complain that the signal is bad and they have to hang up for a while. Interestingly, television programs haven’t shown an uptick. Late shows and afternoon talk shows are suffering in quality even though they are doing their best with a hopeless situation. Scanning the cable guide, one realizes they have seen everything at least twice – including Roy Rogers and Ozzie and Harriet. What has increased is viewers of live streaming and On Demand options.

That leaves TrumpNews. No matter how lonely or how bored the reader may be, don’t be tempted. Check out PBS, NPR, Newsy, Politico, The Atlantic, Protocol, RealClearPolitics, Axios, Propublica and The Economist. All these websites have an ethic about the difference between gossip, news, fake news and uncontrolled political bias.

The psychology types both online and in print suggest that family members deliberately attempt to make the whole family the focus of daily activity. This is a lost motivation because most of the time parents are working, children are at school, and the smartphone has cleaved relationships into small pieces.

Everyone should put on their ‘pass it forward’ hat to find ways to help with the financial hardship that far too many citizens will suffer from job loss, cut hours and the virus itself. These genuinely are historically terrible times.

Finally, although many months late, Congress has passed a decent fiscal package to see citizens through the economic uncertainty. Congratulations.

Regarding the virus, stay in touch daily with trusted news sources.

By the way, Happy Easter . . .

Ancient Mariner

 

What would Socrates say?

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Mariner recently reported on the corruption of Wells Fargo Bank forcing line level employees to create false customer accounts in order to increase bank profits. Mariner knows he is an eccentric but the word profit is a synonym for selfishness, is an abuse of power, and metaphorically profit is comparable to reusable resources that are thrown away every day rather than make further use of them. Power and profit often are the same coin. To wit:

A Newsy and USA TODAY investigation reveals that former employees of one of America’s fastest-growing dental chains say they saw dentists — under pressure to hit revenue targets — repeatedly suggesting treatments patients didn’t need. Patients complained they were diagnosed with a mouthful of cavities only to later discover nothing was wrong with their teeth. Former employees said they felt uncomfortable with what they witnessed. “I have watched them drilling perfectly healthy teeth multiple times a day every day,” said dental assistant Ashley Hughes. Watch “Open Wide” on Newsy.com or stream it anytime on Roku and Fire TV.

The clearest example of a remedy for the profit disease is set by the Native American Indians (mariner has cited this example on numerous occasions). The notable person in the society was the hunter. What sustained Indian culture for thousands of years was that whatever the hunter brought home did not belong to him; it belonged to the tribe and was distributed accordingly. Not until white man appeared did ideas like profit, wealth and supply and demand become cultural terms. One of mariner’s heroes, Will Rogers, lived by the code of his Native American ancestors.

Everyone deserves to be comfortable in life and to have feelings of fiscal sustainability. However, to possess billions of dollars just to possess them is tantamount to leftover food tossed in the trash rather than redistributing it for re-purposing.

A hackneyed complaint of mariner’s is the pharmaceutical industry. CEOs take home an average of $26 million as an annual salary. Meanwhile, the ‘tribe’ has lives ruined – if not ended – to sustain a corporate profit based on what the marketplace will tolerate. Mariner speculates that no person can make meaningful use of profits beyond what it takes to live quite comfortably; excess profits are an abuse of power and a rejection of tribal responsibility.

When FDR was confronted with the great depression, he changed tax laws to limit income to $33,000 annually[1]. If anyone earned more, that amount was sent to the government as tax due. The principle was that the government needed every dollar it could muster to sustain the nation. In perspective, today virtually every major corporation hides billions of dollars in profit – and the privileged class does as well. These dormant assets are not in use; they are in a cash attic. True, these assets can be used to hoard additional cash through investment and that profit, too, is put in the attic.

It was Socrates who questioned whether wealth was a good thing. He also pondered what was good for the human condition, which he felt was a preeminent concept to understand if humanity was to be happy. Today’s societies, if not at war or destitute, are too busy becoming rich or richer to notice that more and more humans are not happy and cannot sustain themselves financially.

Socrates wasn’t sure about democracy, either. He believed that the ultimate power in life was knowledge – even to the point of denouncing trial by one’s peers. He saw in the democratic method an easy boat to sink because voting was not controlled by knowledge but by the myriad vices of the population.

We need Socrates today. In what direction is wisdom? In what direction is happiness? Donald is a classic antagonist for the US: he can’t read, lead, believe valid truths, or have compassion. Only wealth calls his name.

Beyond Donald, humanity around the planet watches an entire civilization crumble. Is the Coronavirus one of the four horsemen along with artificial intelligence, rampant capitalism and cannibalism of the human soul by big data? What kind of culture will emerge that will bring happiness to humanity? Does today’s world know what is good for the human condition? If it did, could it abide?

Ancient Mariner

[1] $656,644 today.

Sustainability

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Increasingly, mariner sees the word ‘sustainability’ popping up in news releases and articles. This is a good sign. It is raising the political thought that classism, elitism, nationalism and identity politics don’t really solve the problems of today’s world.

Were it not for the presence of a global pandemic, failing international economies and global warming, the idea of sustainability may not have emerged so quickly. Thinking in the abstract, as Guru is wont to do, the world may not be able to support oligarchy much longer. The liquidity and business investment value is needed to assuage true hardship experienced by everyone else in the world.

Beyond economics, global warming and pandemics don’t recognize borders or class distinctions. The politics that must deal with these subjects requires sustainability – by everyone. Sustainability is a unification word; it means the solution is more important than individual nations, individual cultures, corporations or individual political movements.

For several decades nations have been trying to deal with global warming by any means that will work other than sustainability (none do). The prime example is the fossil fuel industry dodging sustainability at every turn because its investment value will diminish greatly as the world population insists on moving to more sustainable energy resources.

As to pandemics, if properly funded and given direction, science will slowly make progress in dealing with pandemics from the perspective of sustainable practices, economics and politics. For example, it is not a sustainable behavior when items like face masks suffer price gouging under the not-so-sustainable concept of supply and demand.

One can hope sooner than later that war and its destructive conclusions will be seen as a solution that does not support sustainability.

Sustainability is an updated word that no longer means just surviving on a homestead; it also means surviving on a planet. Perhaps finally the United Nations may come into its own as THE organization responsible for sustainability. Goodness knows it has been trying.

Ancient Mariner