What a fantastic article by Nigel Latta in the NZ Herald (30/8/14).
In it, Latta lists the 10 biggest lessons he learned during the making of his 6 part documentary series, in which he investigated some of what he believed to be the important issues facing 21st century New Zealanders. I won’t list them here, but take a look at the article if you haven’t already.
But what’s really interesting is how it links to the truly extraordinary alleged revelations regarding Judith Collins, Snake Oil and Mark Hotchins. How?
Latta’s number one is “People Do Really Care About People.” This is an interesting statement for a number of reasons, and The Spec believes, goes to the heart of why we are where we are; individually indebted to the eyeballs, absent from our wives, husbands and children for most of their lives, and addicted to anti-depressants, alcohol and sport.
First of all, it’s an incredible statement in that it even needs saying. Why?
A safe guess puts our species as having lived successfully in communities for about 200,000 years. In that time, Homo Sapiens has faced just about every planet changing natural disaster there is. Yet despite getting down to a global population estimated at about 10,000 during the last Ice Age, we have survived everything Nature has thrown at us. How?
Evolution’s greatest achievement has been said to be the emergence of self-awareness. However, the creation of empathy-based cooperation; the core fundamental of any community that stems from the physiology of self-awareness, is what underpins all our greatest triumphs today.
For example; Mr Whale Oil is self-aware (we assume). But one might also assume that empathy and cooperation were not enduring behaviours that featured in the Oil household, when young Whale was a naive and impressionable calf, suckling at his mother’s bosom. Consequently, we now observe what can only really be described as a “feral” kind of individual; obsessed with his own power and influence and prepared to resort to inhumane tactics to increase them. Hardly humankind’s greatest triumph.
In the last 5,000 years, the advent of farming many millenia earlier has led to the rise of organised civilisations, and what we now call the nation-state. The nation state, while certainly delivering extraordinary benefits, has also cursed us with two phenomena that are solely responsible for our afore-mentioned addictions, indebtedness and absences. These are; The Polyarchy, and Debt-Based Currency, and their lethal combination.
These two real-life phenomena – now reaching their 5,000 year zenith – have done more to uproot community and communities, diminish individuals and shred the purpose of our existence than anything God, Nature or Fate could subject our sorry ape asses to since we came out of the trees and gathered around a fire.
A polyarchy can be defined as “..a system where small groups actually rule on behalf of Capital, and the majority’s decision making is confined to choosing among a selective number of elites within tightly controlled elective processes. It is form of consensual domination made possible by the structural domination of the global capital which initially allowed the concentration of political powers.” (Robinson: 1996)
The polyarchs have never had it so good. The 0.05% who control over 75% of the world’s wealth are untouchable. They control the world’s most lethal military machines, its natural resources, a large chunk of the output from scientific endeavour and the power to invent and control the global system of debt-based money. And should the great unwashed successfully revolt or transform into zombies, they have invested in every possible hideaway, from underground complexes in ex-missile silos, to remote luxury islands. They are estimated to have stashed $20 trillion in offshore funds.
Before some of you inevitably race to label me a conspiracy theorist, I am in no way suggesting that there is one homogeneous elite. Far from it. For example; the oligarchs of Russia and the polyarchs of Europe are currently locked in a battle for the right to plunder the Ukraine’s resources, and to smother it in loans.
Similarly, the US and Chinese oligarchs and polyarchs are bound in a form of economic mutually assured destruction. With the Chinese owning and purchasing trillions of dollars of US debt, the US can continue to create more debt and thus fund its ludicrous military obsessed economy. The Chinese can use that debt to manipulate their currency’s exchange rate, rendering their exports cheaper than their US competitors. Each needs the other’s complicity to ensure, on the one hand, the US has the military might to contain China, while on the other, China can manipulate exchange rates to undercut US industry. I guess you’d call it Simultaneous Mutually-Assured Back Scratching Stabbing.
It is the ripples and waves from the battle between these small groups with such enormous power that affect the daily lives of the other 99.95%. How?
Putting aside those parts of the world where war is the manifestation of this conflict, there is one that affects all Western democracies, but is far more insidious.
This is modern debt-based money. As the Bank of England announced a few months ago, everything you learn in economics about money – and the history of money – is wrong. Despite years of economists’ assertions, about 97% of the value of almost any national currency is made up of debt created by private banks and lent to consumers and businesses as electronic funds. But what about all the money the government prints and spends, I hear you cry?
First, you need to make a clear distinction between printing money and creating money (not made any easier by the fact that many “experts” deliberately use the term “printing money” to actually describe “creating money”). Yes, the government (for simplicity’s sake I’m not going to bother with the various roles played here by the Central Bank and The Treasury, as it differs in the US, the EC and NZ) prints actual dollar notes, but these make up only about 2.0% of the total money supply, which isn’t going to buy a lot of hospitals, roads or frigates. The government does not create any money. It borrows it as debt from the banks by issuing bonds (basically an IOU). The bond essentially says “Please loan me $100m.” The banks then create that money as debt – out of thin air – as electronic data entries, and issue it as a loan to the government, which pays the banks interest (again, this is not exactly how it happens in the EU because of the single currency restrictions, but the principle is similar).
But rest assured, it was the tens of trillions (a trillion is a thousand billion) of debt-based money created in this way that led to the last global financial meltdown.
So who was all this money being lent to? Surely that sort of investment would have led to a huge boom in production, investment, GDP and jobs. No. Just house prices and stockmarkets. Oh, and a bunch of extremely reckless gamblers.
The Chair of the Federal Reserve Ben Bernanke called these gamblers the “shadow banking system.” Shadow banking includes entities such as hedge funds, money market funds, structured investment vehicles, credit investment funds, exchange-traded funds, credit hedge funds, private equity funds, securities broker dealers, credit insurance providers, securitization and finance companies.
All of these are just clever terms to describe what are essentially gambling operations.
In this case however, the casino’s patrons, who also own the casinos, are provided with – almost literally – an infinite amount of this “thin air” money by the banks (who in many cases had their own casinos) to gamble on new games they had invented. These games had fancy names like “securitisations” and “collateral debt-based obligations” and were nothing more than bets on possible events in the future, or bets on the degree of reliability of loan contracts between various parties. They were largely non-productive, and in fact were quite destructive, but the patrons and the casinos got paid a shed load of bonuses for making them and laying bets on them. And we all know how important a bonus is to a banker.
In 2007, just before the crash, this insane game of nihilistic indulgence was valued globally at around $50 trillion. That is, this tiny oligarchy of around 100,000 individuals were playing a covert game of roulette that was twice the value of the combined GDPs of US and China. And what they didn’t lose, they stole. And got away with it.
If you haven’t already, crack open a bottle of something medicinal, pour yourself a glass, recline and take a sip. Your first thought (after “Wo”) might be, how did our governments let this happen? Good question; and the answer lies in simply replacing the “our” in that last sentence with “their.” Remember the definition of polyarchy.
Have another sip. As the vapours of that excellent Chardonnay begin to free your mental faculties from the day’s travails, your next question might be; “What about all those bloody experts, like economists. Couldn’t they see this coming?”Another good question.
If you understand a) where all the “money” came from to buy that stuff, b) who it was loaned to, and c) how much was loaned, you already know more about the real world than most mainstream economists and for that matter, most mainstream journalists, pundits and other television talking heads.
For example; if you were to ask a mainstream economist if banks were in any way responsible for the banking crisis, they would answer, primly – “No.” Because economists, like any community of zealots, suffer from a lack of exposure to reality. They refuse to accept banks create money, instead believing banks are simply intermediaries that loan out their deposits. Which is why the announcement from the Bank of England was so significant, because in one short statement earlier this year, it blew a gargantuan hole in the soiled and feeble fabric of modern economic theory.
So: what the hell does all this have to do with Nigel Latta?
Hopefully the answer is becoming clear, despite that second glass of Chardonnay (which I didn’t give you permission to neck, but what the hell). When the power to create and destroy on such a magnitude exists in the hands of such a dangerous, narcissistic few who still remain unaccountable for the global chaos they caused, everyone not part of that gang risks extinction, slavery or penury. We’re already half way there; mortgaged to the hilt, addicted to whatever, removed from our families and communities. And that’s us relatively comfortable burghers of Devonport.
These 100,000 Whale Oils, Judith Collins and Mark Hotchins are people – The Spec would wager – who do not care about people. These are people who will do anything to destroy those who get in the way of them retaining or gaining membership of that polyarchy, or access to that infinite line of credit, which in turn provides them with the wherewithal to go Viking on the world’s communities. To the rest of us, they are the enemy that poses the most immediate threat; more so than ISIS, Al Qaeda, or even the Wallabies.
In his article, Latta says “We are a nation of people who care about each other. Yes, there are divisions, and factions, and cynical opinion-piece writers, and toxic bloggers, but the rest of us really do care. That might seem a little hokey to some people, but it makes me feel better about it all.” No Nigel. That does not seem hokey at all. The vast majority of the human race thinks like that, and has thought like that, for tens of thousands of years. Neo-liberalism – the perverse religion and its God “The Invisible Hand” that justifies all this – is an abomination whose dark roots can be traced back only 100-odd years (before some of you fly off the handle, Adam Smith was not a neo-liberal and would be disgusted by it) .
While we remain under threat, those of us who are people who do care for other people, should add a necessary caveat to their philosophy. Something like; “We should only care for those people who also care for other people.” Like the communities of old, those who won’t share are shunned. There aren’t many of them, but boy, do they currently call the shots. There are the Oiled (and now boiled) Whales, Collins and Hotchins, who may genuinely think like that. Then there is a broad swathe of people who have become conditioned to being cynical about their fellow humans by the toxic claptrap of neo-liberal politicians, economists and businessmen. And then there are those of us who remain optimists, and who have the evidence of history, science and empirical research on their side.
While there is no pleasure in watching any person crash and burn, we should not mourn the demise of these true “ferals.” If we want to protect our families, communities and environment, we are ultimately going to have to do more than just remain bystanders to the carnage, or leave it to the John Mintos and Nicky Hagers to take the flak. It’s time to start digging out those old placards from 1981. Good ol’ George Gair had the guts to stand up for what he thought was right when he ensured the success of homosexual law reform; so can we. Those of you who remember the shit you took for being “anti-tour” or “pro homo” in the 1980s? Now’s the time to stand up and be counted. And those of you who got it wrong back then; now’s your chance to get it right.
But also remember that these true “ferals” skulk wherever there is a sniff of power or money. That is something that transcends political persuasion, gender, race, sexual orientation or any other arbitrary category. That means unfortunately, that you can vote in protest to get rid of these people by voting for someone else, but you can never be sure that those you vote for are not cut from the same cloth. And therein lies the value – whether you like it or not – of people like Nicky Hager, and for those of you who remember The Speculator’s reflections on our local board, Jan O’Connor.
Many of us don’t realise it yet, but because of this scandal, we have just dodged a bullet. Once again, this incredible country has slowed the descent into the polyarchial cesspool in which the US, the UK and Europe have ended up. We’re by no means perfect, and still need to ensure Key is not planning to sign away our sovereignty under the TPP. But just be thankful that this has come out, and will be investigated.
History now agrees that the 1981 Springbok tour protesters were right (to the extent that Key can’t even admit to being on the other side), as were those on the side of homosexual law reform. It would be a shame if we have to wait another 20-odd years before Nicky Hager is similarly hailed. Winston has also, once again, played his part, as has Kim Dotcom. You don’t have to like these characters, or support their motives. But with the rest of us chained with our noses to the grindstone, they’re the ones uncovering the allegations that must now be disproved.
And so, with the last drop of that mellifluous Chardonnay, raise a toast to those unlikely heroes who play the thankless, but very real role, of the protectors of our democracy, and our communities. To Nigel, Nicky and The Whale That Whored.
William I Robinson; Globalisation: nine theses of our epoch, Race & Class 38(2) 1996