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Re: <nettime> Debt Campaign Launch
Ed Phillips on Sat, 10 Dec 2011 05:57:25 +0100 (CET)


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Re: <nettime> Debt Campaign Launch


I've been chewing over and ruminating on this conversation and on some
of the posts that Brian Holmes linked to from another list, and I'm
asking myself what some of the broad themes are and what kind of
idiosyncratic foray I might make that could add to the conversation.

Ted always contributes with a creatively idiosyncratic style that I
find inspires me to respond as creatively as I can. I read some of CLR
James and I note that Keith seems to always only mention particularly
appropriate writers.

Mariners, Renegades and Castaways (by James) seems an apt title for the motley
lot of general intellect adrift in the sea of precarity. James also
reads like he were posting to nettime. He combines analysis and
synthesis with direct address and pointed comment.

The situation is so open-ended and on the surface seems to be so
various and dancing on the head of the pin of the moment that I do
think it important to note the historical invariants that might be obscured by
the use of new terms. Rent-seeking for example is nothing new and in
fact could be said to represent the appearance of the same thing in a
truer, more definite, form due to "progress". Of a man that married one wealthy
wife after another, it was said, the first time it was good luck and
the second time, it was a "skill set."

It's not quite right to say as Keith did that Victorians got rich by
producing something useful cheaper and not by rent-seeking as now. Some did,
surely, as they do today. But the original rentiers and treasury
looters were there first and survived alongside the price driven
markets as they do today. Maybe it was not as much of a skill set as
it is now, but chalk that up to progress.

Keith makes the excellent point in his latest blog post on The Memory
Bank that Hegel was both a prophet and critic of National Capitalism
and its attendant bureaucracies, both state and corporate. Whether that
great trend toward enormous state and corporate bureaucracies is in
its apotheosis or no, no one can say, but we can say that the
sovereign states and the quasi-sovereign corps that survive are growing
larger even as they reach the limits of the absurd. 

They may flicker like mirages and many may go down in flames but the
form itself is strong and consolidating. How does a large bureaucracy
function today, how does it go, and what are the skill sets of its
managers?

A bureaucracy is anything but efficient. Here, the large universities
and large public institutions as well as big corporations come to
mind. They are not the "well
oiled machines" that Brian calls them in a post. Their inefficiency is
a part of their self-validation, and the players must have
inefficiency bred into the bone in order to function within such a
creaking, plodding, dithering machine. 

There is an inflationary bias built into these big creaking machines
that require and must then validate huge overhead costs: administrative, ancillary,
executive compensation, advertising, etc. Firms and institutions with
"market power" offer their goods and services at prices that they
set enough above total current and projected costs to "validate" the
viability of the institution and provide a margin of safety to "debt
owners". The more capital intensive the "production process" is of large
bureaucracies the more of revenue that needs to allocated to servicing
financial needs (debts, capital assets). 

The natural form of capital intensive production is oligopoly and
monopoly (Minsky, 1986); these entities require protection from market forces and from
the efficiency that market competition would bring. These large
entities are best interpreted as "special forms of tax farmers"
(Minsky, 1986).

Big dithering bureaucracies in the midst of systemic financial crisis
don't look so promising. However, they are the result of a long dominant trend
of history, and they are supported by the tax structure, by the
structure of the financial system, by laws and by subsidy, and they
gain "market power" during times of crisis.

What does it take for an individual to survive or to thrive in a large bureaucracy?
Taking in the admonition of Chesterton that any critique ought to
point to the strengths of a subject of inquiry, I want to just conjure
the image of one particular bureaucrat in the US and look at his
capacities as a leader, his skill set.

During Obama's recent lackluster speech to Congress about "jobs", the Speaker
of the House, Boehner, could be seen behind him. It seemed to me as if
every member of Congress were fighting the irresistible urge to nod
off in boredom at the empty ritual. Boehner looked straight ahead,
unmoving, with a perfectly poised and perfectly blank thousand
mile stare. Not the stare of stress or crisis, perhaps that stare 
should be considered a skill and an
achievement of the highest order for a leader in enormous, inefficient
bureaucracy. More than the dotting of the i or the crossing of
the t in Hegel's discussion of the leader, that blank stare puts a
point on the overdeveloped, creaking machine of the oligopoly.

The blank stare says neither yes nor no, it stays still without
occupying any position; it is perfectly comfortable in empty ritual,
in a game in which unspeaking collusion and/or chess has
become instinctual, unthinking.

Oligopolies have their limits and their problems. One of those limits
is what is called the kink in the demand curve, the point at which
they can no longer raise prices without losing customers. For the big
universities that kink was smoothed by the student loan system, by the
institution of the student loan, and by the students' optimism during
the great credit bubble.

Whither goes the status quo? The great blank stare of the Regent is
fixed, the unmoving sovereign in an elaborate game of chess, hemmed in
at all sides by rules and procedures, a kind of death in-life and life
in-death. The more elaborate the hierarchy, the less the chess king
moves or needs to move, thinks or needs to think. Stasis and
lassitude, boredom and empty ritual are more the tenor of the game than the
glamorized movement and change of markets.

If markets are for rigging, are commodity and price markets only the outward
circumference of a vast system of cultural investment and investiture,
the balance of which is protected from markets and from competition?

The only entities that outflank or can outflank the oligopolies are
the people both in and out of the large bureaucracies who are truth
starved enough to light out, the new distributists: the mariners,
castaways, and renegades.

On Wed, Nov 23, 2011 at 10:54:16PM +0100, Keith Hart wrote:

> Thanks for this, Ted. I enjoyed Mark's rant, although I knew it played to
> my old fart tendency. It was well-written too. Brian did a great job of
> reasoning with people of unlike mind. But your post and Ed's (which is on
> the other half of this split thread)  both cranked up the intellectual and
> political stakes, galvanizing me into action.
 <...>


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