Reaching the End of Early Stimulus – What’s Ahead?

Many people thought that COVID-19 would be gone with a short shutdown. They also thought that the world’s economic problems could be cured with a six month “dose” of stimulus.

It is increasingly clear that neither of these assumptions is correct. Despite the claims of epidemiologists, our best efforts have never been able to reduce the number of newly reported COVID-19 cases for the world as a whole for any significant period of time. In fact, the latest week seems to be the highest week so far.

Figure 1. Chart of worldwide COVID-19 new cases, in chart prepared by Worldometer with data through September 20, 2020.

At the same time, the economy, despite all of the stimulus, is not doing very well. Airlines are doing very poorly. The parts of the economy that are dependent upon tourism are having huge problems. This reduces the “upside” of economic recovery, pretty much everywhere, until it can be corrected.

Another part of the world economy doing poorly is clothing sales. For example, many fewer people are attending concerts, weddings, funerals, out-of-town business meetings and conventions, leading to a need for fewer “dressy” clothes. Also, with air travel greatly reduced, people don’t need new clothing for visiting places with different climates, either. Most clothing is bought by people from rich countries but made by people in poor countries. This cutback in clothing purchases disproportionately affects people who are already very poor. The loss of jobs in these countries may lead to an inability to afford food, for those who are laid off.

Besides these difficult to solve problems, initial programs set up to help mitigate job losses are running out. What kinds of things might governments do, if they are running short of borrowing capacity, and medical solutions still seem to be far away?

In Section A of this post, I outline what I see as some approaches that governments might take to try to “kick the can down the road” a while longer, as well as some general trends regarding near term outcomes.

In Section B, I explain how our current problems seem to be related to the more general “overshoot and collapse” problems of many prior economies. I show that historically, these overshoot and collapse situations seem to have played out over a number of years. In many ways, the outcome might look more like “overshoot and decline” than “overshoot and collapse” from the point of view of an observer at the time.

In Section C, I explain two different types of “breakage” we can expect going forward, if we are really dealing with an overshoot and collapse situation. In the first, oil production is likely to fall because of the collapse of some of the governments of oil exporters. In the second, the international trade system breaks down because of problems with the financial system and countries no longer trusting each other’s currencies.

[A] Ideas for “Sort of” Addressing the Economic Problems at Hand 

The following are a few ideas regarding possible mitigation approaches, and the expected results of these attempted solutions:

[1] Programs to keep citizens in their homes will likely be extended. Mortgage repayment programs will be extended. Renters will be allowed to stay where they are, even if they cannot afford the rent.

[2] New programs may be added, allowing those without adequate income to pay for electricity, heat, water and sewer connections. These programs may be debt-based. For example, homeowners and renters may be given loans to pay for these programs, with the hope that eventually the economy will bounce back, and the loans can be repaid.

[3] More food bank programs will be added, with governments buying food from farmers and donating it to food banks. There is even an outside chance that people will be given loans so that they can “buy” food from the food bank, with the hope that they can someday repay the loans. All of these loan-based programs will appear to be “cost free” to the government, since “certainly” the crisis will go away, and borrowers will be able to repay the loans.

[4] Loans to students will increasingly be put in forbearance, to be repaid when the crisis is over. Auto loans and credit card debt may be also be put into forbearance, if the person with the debt has inadequate income.

[5] Even with all of these actions, families will tend to move back together into a smaller total number of residences. This will happen partly because citizens won’t want to be burdened with even more debt, if they can avoid it. Also, older citizens won’t want to move into facilities offering care for the elderly because they know that COVID restrictions may limit with whom they can have contact. They will much prefer moving in with a relative, if anyone will take them in return for a suitable monthly payment.

[6] As extended families move in together, the total number of housing units required will tend to fall. Prices of homes will tend to fall, especially in areas where citizens no longer want to live. Governments will encourage banks and other mortgage holders to look the other way as prices fall, but as homes are sold, this will be increasingly difficult to do. In many cases, when homes are sold, the selling prices will fall below the balance of the debt outstanding. Governments will pass laws not allowing financial institutions to try to obtain the shortfall from citizens, at least until the crisis is over.

[7] Some businesses, such as restaurants without enough patrons and colleges without enough students, will need to close. Clothing stores without enough sales will also need to close, as will retirement homes without enough residents. All of these closures will lead to a huge amount of excess commercial space. It will also lead to the loss of more jobs, raising the number of unemployed people.

With these closed businesses, the price of commercial real estate will tend to fall. Lenders will be encouraged to “extend the loans” and “pretend that asset prices will soon recover,” when renewing loans. Even this approach won’t be enough in many cases, as businesses file for bankruptcy.

[8] With fewer residences and business properties occupied, the amount of electricity required will fall. Wholesale prices for electricity will tend to fall, pushing ever more fossil fuel and nuclear electricity providers out of business. Electricity outages will become an increasing problem, as renewables become a larger share of the electricity mix and are unable to increase supply when needed. Rolling outages will become more common.

[9] Pensions of all kinds will become more difficult to pay. Government programs, such as Social Security in the US, will have less revenue to pay pensions. There are funds set aside in the Social Security Trust Fund to cover a shortfall in funding, but these funds are simply non-marketable US government debt. In theory, the US government could add more debt to the Trust Fund and make payments on the basis of this added debt. Otherwise, the US will likely need to either raise taxes or increase the “regular” government debt level, in order to continue to pay Social Security pensions as planned.

Private pensions, backed by bonds and shares of stock (and perhaps other assets), will find the values of their available assets are falling. Governments, if they are able to, will try to hide this problem. For example, regulators may develop a new way to value assets, so as to make pension funding shortfalls mostly disappear.

In the case of pension bankruptcy, government insurance is often theoretically available. In the US, Pension Benefit Guaranty Corporation provides coverage; other countries may have similar programs. Unfortunately, this program is not set up to handle a large influx of new bankrupt plans, without raising taxes. The problem then will be raising taxes enough so that one year’s pension benefits can be paid, pushing the problem down the road a bit longer.

Bank accounts have similar guarantees, with similar funding problems. The guarantee organization has very little funds available, without raising taxes or somehow increasing debt.

[10] Stock market prices will tend to fall, leading those who have purchased shares using debt to want to sell quickly, pushing the stock market down further. Currency relativities will fluctuate wildly. Derivatives of many kinds will encounter payment problems. Many ETFs likely won’t work as planned. Governments will try to figure out ways to somehow mitigate these problems to the extent possible. For example, stock markets may be closed for a time to hide the problems. Or, additional time may be given to settle purchases, so that perhaps the deficiencies can be corrected. Eventually, some banks may be taken over by governments, to assure the operation of the parts deemed essential.

[11] Eventually, governments may find it necessary to nationalize a wide range of essential businesses. These could range from trucking companies to banks to oil companies to electricity transmission repair companies. If the balance sheets of these companies are too bad, governments may simply stop publishing them.

[12] These types of actions will mostly be available to “rich” countries. Poor countries can tap their “rainy day” funds, but these will soon be exhausted. In this case, poor countries will find that there is little they can do unless international organizations bail them out. Because of cutbacks in tourism and in orders of finished goods, such as clothing, these countries are likely to encounter high levels of unemployment. Without aid, the poorer citizens of these countries will find it impossible to afford an adequate diet. With inadequate nutrition, the health of low income citizens will decline, and they will easily succumb to communicable diseases, such as tuberculosis and malaria. Death rates are likely to skyrocket.

[B] What Happens When an Economy Outgrows Its Resources? 

Most people think that the issue we are dealing with is a temporary problem associated with a new coronavirus. I think that we are dealing with a much worse problem: The world’s population has outgrown the world’s resource limits. This is why our current problems look so difficult to solve from a financial point of view. This is part of the reason many people feel that shutting down the economy for COVID-19 is a good choice. There are really many reasons for the shutdowns, besides preventing the spread of COVID-19: Keeping people inside stops the many protests related to low wages. The shutdowns appear to restore order to a troubled system. Broken supply lines from shutdowns elsewhere reduce raw materials availability, making it more difficult to keep production in one part of the world operating, when others are closed.

Overshoot and collapse is a problem that many smaller economies have encountered over the years. If I am right that we are now encountering a similar situation, there is a big change ahead. The change will not be instantaneous, however. The big question that arises is, “Over what time scale does such a collapse take place?” If it takes place over a number of years, it may look more like “overshoot and decline” than “overshoot and collapse” to those who are living through the era.

A recent partial collapse was that of the Soviet Union in 1991. The Soviet Union was an oil exporter. Oil prices had hit a high in 1981 and had been declining for 10 years when the Soviet Union collapsed. With low oil prices, it had been difficult to earn enough revenue to reinvest in new oil fields to replace the production that naturally declines as oil is extracted. Oil, directly and indirectly, had provided many jobs for the Soviet Union. After ten years of stress, the central government of the Soviet Union collapsed in 1991.

Low oil prices first slowed production growth between 1982 and 1987 (Figure 2). Oil production began to decline in 1988, three years before the government collapsed. Production gradually rose again in the early 2000s, as oil prices rose again.

Figure 2. Oil production and price of the former Soviet Union (FSU), based on BP’s Statistical Review of World Energy 2015.

What was surprising to me was the fact that consumption of all types of energy by the Soviet Union fell at the time of the central government collapse in 1991, even hydroelectric. The overall level of energy consumption never bounced back to its previous level.

Figure 3. Former Soviet Union energy consumption by fuel, based on data of BP’s Statistical Review of World Energy 2018.

What happened was that many inefficient industries were forced to close. Some of these industries were in the Ukraine; others were in Russia and elsewhere. As they closed, less electricity and less oil and gas were used.

The loss in energy consumption was pretty much permanent. The manufacturing that left the Soviet Union was replaced by other, more efficient, manufacturing elsewhere. Also, without their previous manufacturing jobs, the people of the former Soviet Union were poorer. They could not afford to buy cars and homes, keeping fuel consumption lower.

Another indicator regarding the speed of collapses is the analysis done by researchers Peter Turchin and Sergey Nefedov, regarding collapses of eight agricultural economies from earlier periods. I compiled the information they provided in the book Secular Cycles in the chart shown in Figure 4. In the cycles they analyzed, the “crisis period” seemed to last 20 to 50 years. One thing that is striking in their analysis is that epidemics often played a major role in the declines. As wage disparity grew, poorer workers ate less well. They became more vulnerable to epidemics and often died.

Figure 4. Chart by author based on information provided in Turchin and Nefedov’s book, Secular Cycles.

In these early cycles, the major industry was farming. These collapses were in the days before electricity use. In these situations, collapses tended to play out over 20 to 50 years. Our more modern economy, with its just-in-time supply lines, would seem likely to collapse more quickly, but we can’t know for certain. This analysis is thus another data point that suggests that what may be ahead could be closer to “overshoot and decline” than “overshoot and collapse.”

[C] What May Be Ahead

[1] We are likely to experience the collapse of central governments of several of the oil exporting nations, in a manner not entirely different from the collapse of the Soviet Union in 1991.

Oil prices have been low for a very long time, since 2008, or at least since 2014.

Figure 5. Weekly average spot oil prices for Brent, based on data of the US Energy Information Administration.

Most OPEC oil producers seem to require prices in the $100+ per barrel range in order to be able to fund the programs their people expect (Figure 6). One important program provides subsidies for imported food; other programs provide jobs. Without these programs, revolutions to overthrow the current leaders seem much more likely.

Figure 6. Estimate of OPEC break-even oil prices, including tax requirements by parent countries, from APICORP. Figure is from 2014.

At this point, oil prices have been below $100 per barrel since 2014, a period of 6 years (Figure 5). Stress is increasing; OPEC producers have cut production in an attempt to try to get prices up. Prices are now in the low $40s.

We should not be surprised if, over the next few years, oil production starts to fall in several areas around the world because of internal problems. Another possible impetus for the drop in production may be wars with other nations. Some such wars might be started simply to try to get the price of oil up to a more acceptable level.

We have been falsely led to believe that oil is not important; renewables can handle our needs in the future. In fact, oil is essential for today’s farming. It is essential for transportation of goods and services of all kinds. It is essential for the construction industry and for mining. Researchers in academic institutions have received grants, encouraging them to put together models regarding what could be ahead. These models tend to be extremely unrealistic.

One of the most absurd models is by Mark Jacobson. He claims that by 2050, the world economy can operate almost entirely using wind, solar, and hydroelectric. Unfortunately, we don’t have until 2050; world oil, coal, and natural gas supplies look likely to decline in the 2020 to 2025 timeframe because of low prices. Another problem with this approach is that there is not very much fossil fuel to extract, because most of what appears to be available from resource studies cannot really be extracted at the low prices set by physics. 

The underlying problem is confusion about which direction prices go, as an economy reaches limits. Economists assume that scarcity will cause prices to rise; the real story is that fossil fuel prices are set by the laws for physics because the economy is a dissipative structure. As the economy approaches limits, prices tend to fall too low for producers, rather than rise too high for consumers.The sad truth is that we can’t even count on the continued extraction of the small amount of fossil fuels that Jacobson assumes will exist after 2050.

[2] We are likely to see a huge change in the international financial system and in the international trade system in the next few years. 

As long as there were plenty of resources, relative to the world population, the optimal approach was to do as much international trade as possible. This approach would maximize world GDP. It would also add jobs in developing areas of the world without too huge an impact on job availability in the countries moving their manufacturing to lower-cost areas.

In the last few years, it has become increasingly evident that there aren’t enough jobs that pay well to go around. This is really the underlying problem with respect to the increased hostility among nations, such as between the US and China. Tariffs are being used to try to bring jobs that pay well back to those who need them. Strange as it may seem, it takes fossil fuels to create jobs that pay well.

Figure 7. World Trade as a percentage of GDP, based on data of the World Bank.

Figure 7 shows that international trade was rising as a percentage of GDP for many years, and it hit a high point in 2008. Since then it has bounced around a little below that high point. In 2020, it will clearly take a big step down because of all of the cancellation of trade related to COVID-19 restrictions.

We saw earlier that commodity prices tend to fall too low for producers. Indirectly, this means that profits tend to fall too low. Interest rates tend to follow these low profits down, since businesses cannot afford to pay high interest rates.

With these low profits and low wages, the financial system gets strained. “Debt and more debt” seems to be the way to fix the system. Growing debt at ever-lower interest rates is encouraged. These low interest rates tend to raise asset prices because monthly payments to buy these assets fall with the falling interest rates. Stock markets tend to rise, even when the economy is doing poorly.

If the many strange approaches I outlined in Section A are used to add even more debt to keep the system afloat, eventually some part of the system is going to “break.” For example, banks will stop issuing letters of credit with respect to purchases made by buyers that don’t seem sufficiently creditworthy. Banks may stop trusting other banks, especially if the banks do not really seem to be solvent. At some point, the international financial system seems likely to start “coming apart.” Eventually, the US dollar will stop being the world’s reserve currency.

My guess is that a new two currency system will develop. Governments will issue a lot of currency for local use. It will not be useful for buying goods from other countries. Much of it will be used for buying locally produced food and other locally produced goods.

Very little international trade will be done. Any international trade that will be done will occur between trusted partners, at agreed upon exchange rates. Perhaps a special currency will be used for this purpose.

In this new world, individual countries will be very much on their own. With very little fossil fuel, countries will tend to lose electricity availability very quickly. Transmission lines will go unrepaired. It will become impossible to fix existing wind turbines. Road repair will become impossible. Electric cars will likely be as unusable as gasoline powered ones.

There will likely be fighting about resources that are available, leading to countries subdividing into smaller and smaller units, hoarding what little resources they have available.

Note:

1Energy prices tend to fall too low because, as the economy gets more complex, wage and wealth disparity tend to grow, reflecting differences in training and responsibility. The problem occurs because low-paid workers cannot afford to buy very large quantities of goods and services produced by the economy. For example, many cannot afford a car or a home of their own. The spending of high-paid workers does not offset the loss of demand by low-paid workers because high-paid workers tend to spend their wages more on services, such as advanced education, which require proportionately less energy consumption. Ultimately, the lack of demand by low-paid workers tends to pull down the prices of oil and other commodities below the level required by producers.

This entry was posted in Financial Implications and tagged , , , , by Gail Tverberg. Bookmark the permalink.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.

2,450 thoughts on “Reaching the End of Early Stimulus – What’s Ahead?

  1. https://www.lifesitenews.com/news/australian-prime-minister-covid-vaccine-will-be-as-mandatory-as-you-can-possibly-make-it

    AUSTRALIA, August 19, 2020 (LifeSiteNews) – The Australian Prime Minister has said that he expects a coronavirus vaccine will be made “as mandatory as you can possibly make it.”

    Scott Morrison, who has been Prime Minister since August 2018, has subsequently somewhat walked back the comments, saying that there will be “no compulsory vaccine but there will be a lot of encouragement and measures to get as high a rate of acceptance as usual.”

    Morrison’s original comments were made during a 3AW radio interview.

    Within 24 hours Australia’s senior politician had backtracked, saying in a subsequent radio interview on 2GB that “it is not going to be compulsory to have the vaccine, OK? It’s not compulsory. There are no compulsory vaccines in Australia.”

    Morrison said that “there are no things that force people to do things,” adding that there will be “no compulsory vaccine, but there will be a lot of encouragement and measures to get as high a rate of acceptance as usual.”

    When questioned by the interviewer, who said that he understood that Morrison had wanted to make the vaccine mandatory, the Prime Minister replied: “there are no mechanisms for compulsory, I mean we can’t hold someone down and make them take it.”

    [They can know hold you down and make you take it in western Australia!]

    On Tuesday Morrison announced that the Australian government has made an agreement with British pharmaceutical company AstraZeneca to supply Australians with their coronavirus vaccine for free, providing that the vaccine passes clinical trials. AstraZeneca are using the HEK-293 cell line made from fetal cells harvested from an aborted baby decades ago in the production of their coronavirus vaccine.

    LifeSiteNews has spoken with a number of Australians who are very concerned about the new coronavirus vaccine and their government’s plans.

    One Australian mother told LifeSiteNews that the sorts of “encouragements and measures” that will be used to get people to take the coronavirus vaccine are already in places for a host of other vaccines. While there are differences in the exact requirements in each state, as a matter of national policy children in Australia must “meet immunization requirements” in order for families to qualify for particular family tax benefits or assistance with child care fees. In the past 24 hours, Morrison has boasted of his role in creating this policy while promoting the coronavirus vaccine.

    Among the various Australians interviewed by LifeSiteNews, John Mac, speaking from lockdown in the state of Victoria, detailed Morrison’s record as Social Services Minister.

    “This is the guy who removed conscientious objection to medical treatment. As a junior minister, he extended the government’s ‘no jab, no play’ into a ‘no pay’ policy by withdrawing essential support from parents who refused to immunize their children. At this rate he’d have us believe that the government not only knows better, but cares more for our children than we do,” he said.

    “For decades we’ve been told that nothing can come between a woman’s decision and her doctor, but after today’s announcement it seems that choice and medical autonomy aren’t so absolute after all.”

    In May, Home Affairs Minister Peter Dutton urged the NRL, the governing body for the professional rugby league in Australia, to adopt a “no jab, no play” policy after several players cited religious grounds for refusing a flu vaccine.

    “We shouldn’t give any credibility to people that preach what is a religion for some, for a small minority, because it’s dangerous,” Dutton said.

    In Melbourne, Australia’s second-biggest city, police now have the power to enter private homes without a warrant or permission to carry out “spot checks,” as part of a new state-wide lockdown regime after politicians declared a “state of disaster” in response to an alleged rise in coronavirus associated deaths and positive test results.

    Speaking on August 3, Victoria police chief commissioner Shane Patton was unapologetic as he explained that police had in some instances been smashing car windows due to people inside the cars not cooperating with police or following the newly imposed health guidelines.

    • They can’t make you take the vaccine but “wink wink” they can restrict your freedom movement and make your life miserable, making you wish you had taken it.

      I wonder how many will refuse the vaccine on religious grounds “i.e. The Mark Of the Beast”?

    • Requiring vaccine is moot for the near time. When it first becomes available so many people, including me, will be clambering for it. I appreciate the refusers who take themselves out of line, so I will get it sooner.
      Anyway, with enough immune people, either from the vaccine or from infections herd immunity will kick in. Let the non-vaccinated live out their death wish.

      • Ha ha. their “death wish” of being part of the 99.9% of people on the planet who will survive covid exposure (whatever that may or mayn’t be) naturally.

        Perhaps you mean “clamor” rather than “clamber”?

        • I can pretty much guarantee that Anthony Fauci and Bill Gates won’t be begging for any of those Covid 19 vaccines. This Covid 19 hoax is all about The Great Reset which has been in the works for decades. Fortunately Klaus Schwab let the cat out of the bag and exposed this hoax during the World Economic Forum.

          • Vaccines/injections/implants protect the pharmaceutical industry, who are immune to any lawsuits!

            • people make a lot of money producing anaesthetics

              and many people have died as a reaction to using them

              when they were first introduced there was much resistance to using them

              maybe they should be banned too?

            • @ Norman Pagett

              Banned? Has anyone suggested banning anything? The resistance to these forced injections is from people who wish to manage their own immune systems.

              When did my immune system become part of a national franchise in the global Big Pharma-Government protection racket?

              Nice family you got there. Be too bad if the government had to take your kids away from you. Don’t say that hasn’t been mooted!

              You and others want injections, have at it! You’ll be protected and supposedly I won’t be. How is that any skin off your nose?

            • @Kim “You and others want injections, have at it! YOU’LL BE PROTECTED and supposedly I won’t be. How is that any skin off your nose?”

              Or will they? A vaccine test study in the UK was temporarily shutdown do to a major illness from a Covid 19 vaccination. I forget if it was a Glaxo test vaccine but the individual became ill with an unexplained spinal illness shortly after being given a vaccine.

              https://www.huffpost.com/entry/astrazeneca-coronavirus-vaccine-hold_n_5f5829edc5b6b48507f8f6e5

    • The majority would probably be happy with that, and only too happy to be deprived of free speech.

      Consider how many regret the social security the Soviet state offered.

      Civil liberties were, after all, generally won from kings by the aristocracy and the bourgeoisie (I generalise hugely, of course, but they were never won by the mass of the people.)

      Forward, Comrades!

      • Perhaps they appreciated the trade off between empty “civil liberties” to be slaughter by w. capital (WWI+WWII) for a little bit of ~modest comforts for a while. Then failed gov maneuver during late cold war, color revolution, another episode of w. plundering, now a brief respite and consolidation.. Conclusion, the disease of liberalism is dead for several centuries for them now, the hard earned antibodies are hopefully drilled into the genes.

        • Quite so, worldof, for the mass of people, without property, civil liberties meant nothing, and they will always be traded for a full stomach, sex and alcohol – particularly if resistance means death or a nasty exile.

        • One of my French ancestors was at Runnymede – but on King John’s side as a bodyguard. The usual family good judgement….. 🙂

          In Britain the peerage brought down the Stuart dynasty because they feared a French-style absolutist regime, which wouldn’t allow them to enjoy their wealth and liberty in peace, but the mass of people benefited indirectly in so far as they had any property.

          • Xabier, the Stuart dynasty plunged Britain into three civil wars in just 159 years. I doubt the mass of people benefited much from that.

  2. “Mid-year stocktaking by the Switzerland-based Internal Displacement Monitoring Centre finds escalating conflict and violence in the first half of this year have triggered an upsurge in the numbers of people fleeing their homes and becoming newly displaced within their own countries.

    “Around 14.6 million people in 127 countries have been newly displaced between January and July because of natural and man-made disasters. This is about one million more than in the first half of last year.”

    https://www.voanews.com/africa/millions-newly-displaced-escalating-conflict-violence-year

          • the bottom line on the refugee crisis is that we (the rich west that is) went in and screwed up their countries over the last century or two

            now they are returning the favour

            • fair enough

              but that would mean that:

              we didn’t loot Africa’s energy resources in the form of human slaves

              or strip africa’s gold and diamond mines

              or in 1885 hold a conference of European nations and divide up Africa between them, with no consultation with the African people

              Or when oil was found in the middle east we didnt loot their oil at the expense of the native peoples who live there,

              Or ferment wars to keep the oil flowing to sustain our ‘western’ lifestyle

              we didn’t alter the climate so that their lands are becoming unlivable

              (to mention just a few points)

              It would be interesting to know just where marxism fits into all that?

            • Norman, please calculate any short-term benefit of African slaves versus their cumulative cost to western societies up to the current day. I think you will find the putative “investment” to have backfired.

            • Who is this “we”, Norman? You and the rest of the Normans may have been members of the raping and pillaging imperialist faction, but we Anglo Saxons had no part in any of it. We’ve been peasants and wage slaves all the way back to 1066 and beyond.

            • “Norman, please calculate any short-term benefit of African slaves versus their cumulative cost to western societies up to the current day. I think you will find the putative “investment” to have backfired.”

              Scott Adams says reparations in the USA would be negative:

            • you may well be right

              but hand a calculator to someone in a rubber boat trying to cross the Med

              and ask him to figure it out

            • Norman, by “ferment”, I think you might mean “foment”.
              The West has done far more in the way of increasing population in Africa than in extracting resources from her. African countries can feed themselves when whites are in charge, and not otherwise. There is no way around this.

            • Lidia you are correct. We ferment wine and beer. And our armpits ferment if we don’t wash them often enough. But wars get formented and their victims get tormented.

            • Every society and empire on earth has had slavery, from the Mahapajit of Java taking slaves from the Phillipines to the slave states of the Inca, to the huge and long-lasting slave-based empires of Islam.

              Central Africa itself was ruled by vast, constantly warring slave states which traded captives to places as far away as India prior to the days of European colonialism. There are still pockets of descendant “black” Indians to be found on the west coast of India today.

              Slavery ate into Europe too with the Barbary pirates famously making slaving raids not just in the Meditteranean but also to Ireland, the south of England, Atlantic France and Iceland for the Ottoman slave trade.

              According to the Cambridge World History of Slavery Vol. 2, the Ottoman trade took 100,000 white slaves anually during the middle decades of the 16th century. That is an annual number that is multiples larger than for any period of the triangular trade.

              Perhaps the European Union should dun Mr Erdogan for suitable reparations?

            • Read what I wrote again, Norman. Maybe it will help you if I flip it around: If YouTube *has* censored it, you might find it on Vimeo or Bit-chute

            • Did you do that Norman? Did anyone you know do that? If not were you and others born into karmic debt by your race and nationality? Marxism must have class differentiation to operate. No class differentiation no Marxism. The trouble is if we all have any chance of getting along and not slitting each others throats with rusty knives we cant hold BS ideas about victimization. If Marxism didnt have at its root violence and enmity i could perhaps consider its principles. People who are attracted to violence, have hero ideas will find one way or another to actualize them. The choice of which route seems largely determined IMO by which philosophy the majority of women in the deciders population hold. The reality of conflict , of war usually destroys those who survive it. That choice that karma is real not BS.

  3. “The next financial crisis may be coming soon: Fears of a credit crunch have already hit business confidence and worried banks…

    “…a financial crisis does not always materialise in the same way it did with the Lehman Brothers’ collapse. Sometimes financial stress emerges in a more insidious manner…

    “One problem haunting finance, as Carmen Reinhart, chief economist of the World Bank, notes, is that leverage at many institutions was sky-high even before Covid-19. “If you look at financial sector vulnerabilities, in the longer term it is difficult to not be pretty bleak,” she told me.”

    https://www.ft.com/content/c95e5a72-8322-4cfc-b36a-69e8998aea01

    • “The major banks are far more risk averse and better capitalised than in the past crisis, and the housing industry is prospering from the refinancing boom made possible by Fed easing. Since the Lehman/2008 crisis, risk has been moved off bank balance sheets and into securitisation markets.

      “That is why I think it is more likely that the coming financial crisis will be triggered by the market’s rejection of a few classes of securities. Something like this happened in 1929 with the collapse of pyramided securities holding companies.
      So to find the point of vulnerability in the US financial markets, I believe we have to look for the least legally flexible credit securities that can move the fastest from low risk to visibly defaulted.

      “Those would be the commercial mortgage-backed securities (CMBS), particularly those floated in the market between 2012 and 2017. Because they are (mostly) not held on bank balance sheets, there is no bank that can decide, say, to amortise their principal and interest payments over a longer timescale.

      “Unlike almost all collateralised loan obligations, CMBS cannot have any substitution of collateral. Meaning you cannot move a few bad assets to the sponsor’s own balance sheet and replace them with performing assets that can be added to the CMBS collateral pool.”

      https://www.ft.com/content/f9ff9ed0-c7ff-4718-a65b-8be712379e84

      • High octane debate at Surplus raging in past ~two days.
        People debate sequencing for the next stimulus or not.

        Also Don made very interesting comment about the MIC, industrial, financial and tech sphere interests within a state. As well as the more macro view about conflict of financial vs technocratic dominated empires.

        Not sure he meant that way, but even in the first part it is possible to speculate that the jockeying position among the internal factions change over time. Take the MIC, these guys mellowed somewhat from exalted WWII and ~hot-cold war period, now they mostly joystick bomb foreign lands via sat link, and organize color revolutions with diminishing results, their msm and hired political clowns not winning popular contest either. While the best talent and enthusiasm pours into tech ~exclusively. Color me naive but this unbalance must fruit some bigger change over time. I’d say sooner or later the structure of financial-tech duo with their MIC sidekick could turn into even more vertical power order of tech giants on top with their two subordinated sidekicks the fin oligarchy and MIC operators bellow.

        Now, for the “fun part” it’s too late for the tech futurists to leverage newly gained power for turning the situation around. One can easily imagine pursuing personal (tribe – member’s area) obsessions only, e.g. Muskian “settlers” expedition to Mars in ~2030s, while most of the societies on Earth degenerate into unemployment and chaos. The end game being the colony obviously not able jump starting stable settlement, but capable introducing some modified microbiota bugs to colonize that space. While back home the Earth finally shuns the humanoids as they depower into oblivion. The next few decades will be interesting times.

        • Oh, it finally occurred to them that the fin/economy racket floats on top of tech and natural resource extraction.

          The mil-ind complex is nothing without tech + darpa, etc.

          When will they reach the insight that all humans are puppets? Yup, it’s all Machine now.

        • Oh, it finally occurred to them that the fin/economy racket floats on top of tech and natural resource extraction.

          When the finance became fin “tech”. That was the game over moment.

          It’s all Machine from now on.

      • Large companies have many factories, offices or retail outlets, in many cities. They choose a bank, therefore, that has many branches close enough to serve these components and their employees. A bank with fewer branches is therefore less attractive to its most valuable customers, and therefore is at risk of losing them. What deutsche bank is doing is popularly called a death spiral. May it be so!

  4. When I heard the announcement regarding California requiring cars to run on electricity, my first thought was, “These folks don’t have enough electricity now to keep the lights on. What possibly are they thinking about?”

    Apparently, the WSJ has the same thought. It has an article, California Wants Cars to Run on Electricity. It’s Going to Need a Much Bigger Grid
    The state has recently struggled with rolling blackouts due to tight power supplies. Going all electric in 15 years will dramatically increase electricity demand.

    Energy consultants and academics say converting all passenger cars and trucks to run on electricity in California could raise power demand by as much as 25%. That poses a major challenge for a state already facing periodic rolling blackouts as it rapidly transitions to renewable energy.

    Electricity is an even bigger challenge than oil. The idea is based on the “Grass is greener on the other side of the fence” principle.

    • Lets put aside the goal being ~slightly unrealistic, as even per most optimistic scenarios the econobox EVs segment won’t start at ~$20k. Apart from declaratory political, the goal is likely to lure in the early adopters (well advanced adopters at this stage lol), companies, aka money.

      Their advisers and assorted lobbies simply ran the numbers, and figured out, that it is possibly to run most of the local/state bound miles out of [residential renewables]. How and if they are capable to match it with the grid itself 24/365 incl. extreme situations (long overcast weather, failed backup power stations etc.) is another and valid point.

      My guess it’s too late for this plan in this political-social-economic climate.. it could have been done (jump started) few decades earlier..

      • The Hirsch Report realised just that. The car industry transition should take 50 years if it goes smoothly. So as we started it in the 70’s (cough) there will be no Problems going further…

      • If the vehicle batteries can be run of household photovoltaic during the day when the house batteries are already full its a win. Panels are cheap so upgrading to accommodate two battery sets is not much cost maybe another charge controller also. but u know all this already hman :).

  5. Hunger is stalking more and more Americans, although food remains plenrtiful

    THE LEVEL OF hunger in U.S. households almost tripled between 2019 and August of this year, according to an analysis of new data from the Census Bureau and the Department of Agriculture. Even more alarming, the proportion of American children who sometimes do not have enough to eat is now as much as 14 times higher than it was last year.

    The Agriculture Department conducts yearly studies on food insecurity in the U.S., with its report on 2019 released this month. The Census Bureau began frequent household surveys in April in response to Covid-19 that include questions about hunger.

    The analysis, by the Washington, D.C.-based Center on Budget and Policy Priorities, found that 3.7 percent of U.S. households reported they sometimes or often had “not enough to eat” during 2019. Meanwhile, the most recent Census data from the end of August of this year showed that 10 percent of households said they sometimes or often did not have enough to eat within the past seven days. Levels of food insecurity in Black and Latino households are significantly higher, at 19 percent and 17 percent, respectively, compared to 7 percent in white households.

    Even worse, while about 1 percent of adults with children said their children sometimes or often went hungry in 2019, between 9 and 14 percent of such adults said the same about their kids in August 2020. CBPP estimates that this adds up to about 5 million school-aged children in such households.

    “What I see every day from the pandemic is amazingly-increased numbers of severely underweight children coming to our clinic, and parents really panicked about how they’re going to find enough food,” says Dr. Megan Sandel, an associate professor of pediatrics at Boston University School of Medicine.

    https://theintercept.com/2020/09/23/hunger-food-insecurity-coronavirus-children-census/

      • They need a lot of energy supplies, so they eat food that causes the accumulation of energy supplies, i.e. obesity.

        • more precisely junk food overdose.. lot of sugars and various processed “stuffing” ingredients; there is also the social factor of broken families with no prior history of family prepared meals across generations aka bad eating habits for decades..

          • Tim’s point was that there was a shortage of food and there clearly is not given the very poorest get obese. The western world seems awash with food at the present, it’s everywhere you look. This week I watched hundreds of acres of sweetcorn harvested and sent to a bio-fuel enterprise.

      • The food that they eat doesn’t have the nutrients that people really need. That is why it is called “junk food.” But unfortunately, junk food tends to be very cheap in terms of the cost of calories per dollar or pound.

        • During this pandemic my wife and I started having more organic salads about 6 of 7 nights a week and I stopped eating fast food completely. My wife had already been having this diet, but for me the results are amazing! Lower weight, lower blood pressure, and a healthy glow to my face in my mid 60’s! I can work harder, longer hours.

          My wife says leafy greens are the most nutritious food available and that seems obvious now. Nothing else in a diet seems to do what leafy greens do, so I highly recommend them to people. I’ll never go back to a bad diet again.

          Also, in the morning try a bowl of organic oats with blueberries, blackberries and sliced banana with unsweet soy milk. High in roughage.

          For calories I’ve been having peanut butter on toast. The body does need calories.

          Also try cans of Swanson (no antibiotic fed) chicken breast with low fat mayo on toast.

          My other advice is avoid cheese. That stuff is deadly to the vascular system as the fats from it build up in the vascular system.

          64 and my blood pressure just taken is 128 over 84 and that’s with no medication. In fact when I rarely go to a doctor they are amazed I take no meds, but they often try to get me on meds to get my 2nd blood pressure number down to 80. I’ve tried them and my body overreacts and my blood pressure rises, so I really have to do it with diet.

          • You made a wise move stopping the fast food and eating more organic veggies, and your body is thanking you for that.

            There’s cheese and then there’s cheese. The synthetic stuff that is usually served melted on a pizza topping is probably not very good for you, but the good wholesome organic stuff is the nearest thing we mortals can get to ambrosia.

            There are a dozen reasons why people say its good for you and a dozen reasons why people say its bad for you. Overall, in moderation, and if you enjoy eating it, it will do you more good than harm. But if you are going to worry about the harm it may be doing you, then it might be better to avoid it, as the mind itself is a major factor in health and disease.

            There was once an Indian hermit who lived in a cave and was 171 years old. He subsisted entirely on oatmeal swimming in goat’s milk, twice a day, morning and evening, with an extra helping on Sundays. When the doctor paid a visit to the cave to give the man a check up, he said he’d never seen such perfect blood pressure on a hermit that old before. When he asked what the man’s secret to long life and health was, the hermit replied that from a young age he had religiously eliminated all foods that any health authority had ever advised people to avoid. “After all, you are what you eat,” he concluded.

            • Herdsmen who ate a LOT of their own cheese were always noted for their longevity and health.

              Olive oil, vinegar, lamb, cured sausage, strong red wine, pasta, lots of garlic, onions, lettuce in season – and none of it buggered about with.

              They exercised a lot, too, as part of the job – it’s not so hard to be healthy that way.

              Right, that puts me in mood for a carbonara with home-grown lettuce, the last of the season, and 14.5% Catalan wine. Then a few miles on the bike and whack some logs with a maul……

          • Nobody needs “roughage”. That is just a way for breakfast cereal makers to get you to pay for the waste they would otherwise throw away.

            In fact, we should not eat things that are in fact “inedible” as such material only contributes to so-called leaky gut, where undigested proteins pass through microscopic perforations in the gut lining and provoke immune responses that become ultimately overactive.

            You really, really don’t want that.

            • I’m no expert, but I’m going to have to respectful disagree with the “Nobody needs ‘roughage’ advice.

              If you’ve got a leaky gut, you would obviously be well-advised to take special care of it. But I’ve never seen any evidence that eating roughage causes that condition. On the other hand, it may well be that not eating enough roughage is a risk factor.

              For instance, diabetes is considered a risk factor for IBS, and roughage can help to control diabetes.

              No, the more I ponder this on, the more I feel it in my gut that our society is neglecting its dietary health but not ensuring that everyone gets enough roughage!

            • Have to agree with Kim on this one. Lettuce has almost no nutritional value. It can actually take more calories to digest, then it provides. Good if you are already fat, but not good if you are starving.

              It has more value feeding it to a chicken and eating their eggs.

              I do use lettuce to soak up more fat in my salad or omelette though.

            • Tim, anecdotal, but there is a movement now of IBS suffers who have cut out vegetables and fiber completely from their diet with great success. Like, life changing success. Proponents of this way of eating are trying to get funding for a study, but there is a lot of push back from the main stream.

      • https://efficiencyiseverything.com/the-highest-calorie-per-dollar-food-in-human-history-flour-vs-oil/

        The highest calorie-per-dollar food on the US market is canola (rapeseed) oil, of which 90+% is GM (meaning it is likely to have gut-harming glyphosate residue).

        Runners-up are conventional wheat flour and sugar, so that morning doughnut is the cheapest way to achieve your caloric, if not your overall nutritional, needs.

        Things rich people eat, like fresh fish, arugula, etc., are extremely low on the calorie-per-monetary-unit scale. Fresh raspberries were at the bottom of the limited classification presented at the site above, coming in at 13 calories and zero grams of protein per dollar.

        • I have ankylosing spondylitis, a hereditary type of spinal arthritis.

          At age 49 I thought I was not many years from a wheelchair. I would get little sleep ith the nightly pain and wake up each morning exhausted and bent to the side like the letter C. It took me two hours to straighten up each day. I changed my diet to a quite strict but still delicious low-inflammatory diet. The only oils I will eat are animal fats, coconut, olive and palm oil. The other factory oils are evil and I won’t touch them. Nothing that has ever been near glyphosate!

          Now, at 61, I run 40 metre sprints and work out daily on gymnastic rings. Sleep fine. Little pain.

          But I do miss a drink. So I always have a glass of red when I catch a plane.

          • I should also add that changing from being a sun avoider to a sun lover made a huge, immediately noticeable positive effect on my health.

          • Good move, Kim. But how do you manage to avoid glyphosate? I eat a lot of greens, but most of them are no produced by me, and as i dont regularly buy organic food, i’m sure i’ve some glyphosate in every meal eat. How to avoid it without growing all your food (which is almost impossible). At least in my country, glyphosate seem to be everywhere:

            “Study detects glyphosate in the urine of Portuguese, although 80% of participants are regular consumers of organic products”
            The researchers gathered urine samples from 79 portuguese participants, aged between 20 and 68 years,and urine samples were analyzed by two “different analytical methodologies. According to the researchers, the two urine samples from each volunteer were sent to two laboratories, at “different time points”, where they were analyzed based on “gas chromatography coupled to mass spectrometry” and liquid chromatography coupled to mass spectrometry “.

            According to the published study, in the first round of tests, 28% and 50% of the participants had detectable levels of glyphosate and AMPA [chemical compound], respectively, with average values ​​of 0.25 and 0.16 micrograms per liter.

            In the second round, 73% and 97% of the participants had detectable levels of glyphosate and AMPA, respectively, with average values ​​of 0.13 and 0.10 micrograms per liter. Even though it is a “pilot study with preliminary results” and does not allow “robust conclusions” to be drawn, the researchers say that the “percentage level of participants where the substance was detected are, in fact, higher than studies carried out” in other countries, such as Ireland and Germany.
            In 2017, VISÃO asked a laboratory to test 113 foodstuffs sold as organic, in what was the largest study of its kind in Portugal. The investigation revealed that 20% of the products had traces of synthetic pesticides. A cabbage even had 1.2 mg of glyphosate, 12 times more than the legal safety limit.

            https://visao.sapo.pt/atualidade/ambiente/2020-09-10-estudo-deteta-exposicao-ao-glifosato-em-amostras-de-urina-de-adultos-portugueses/

            • How to avoid glyphosate? Well, the truth is I can’t entirely so I try to minimize it. I don’t eat any grains, as they are actually also soaked in it after harvest to keep them dry, I believe. No pulses. No factory oils except palm oil, which has very little processing.

              I also eat no high-glycemic vegetables such as potatoes. And nothing out of any kind of packet. I would trust eating locally grown cassava as that is never directly sprayed.

              My diet is meat, fish, eggs, but predominantly vegetables, especially leafy veges. The plate is full of veges. And some fruit. And I eat sauerkraut daily.

              I am very fortunate in that my meat – beef and goat – and eggs all come from local peasant farms where the animals are essentially free range or hand-fed with grass that rows by the roadside. The grass could be sprayed. of course. But it would be minimal. The chickens walks around everywhere pecking. Fish straight from the sea.

              People who live in Western cities will of course have a big problem getting this kind of clean food.

      • I noticed the same in the US, back when food stamps were pieces of paper: the people who paid with food stamps seemed to eat too much and badly. Story: as the sole breadwinner for a family of seven, I always tried to buy cheap healthy food, which was not particularly hard. One day at the checkout, with my basked of c.h.f, I noticed that the woman in front of me was buying a few kilos of prime steak. One of the children was with me, and when he saw the steak he said “Father, why don’t we eat steak?”

        And as the food stamps came out, I replied, “Sorry, son, we’re not poor enough to eat steak.” The person in front, who was female, grossly obese, and a person whose “life mattered”, gave me a look that would have incinerated me on the spot.

    • Boston is in one of the most liberal, high-income areas of the country. Massachusetts is very liberal when it comes to giving benefits to everyone for everything. It is known as “Taxachusetts.” I am surprised that a pediatrician there is seeing more severely underweight children.

      • “Trotskyist ideas won at the end of the 20th century in the USA and brightly manifested themselves in the ideology of the liberal globalism of a part of the contemporary American political elite (globalists).”

        Igor Panarin – that Russian fellow who some years ago was predicting the collapse of the USA in 2010.

  6. Some time ago there were some interesting posts here on OFW regarding slavery. In the book The Half Has Never Been Told: Slavery and the Making of American Capitalism, historian Edward E. Baptist argues against historians who regard slavery as an uninteresting siding in US economic history. Baptist shows that slavery was not only cruel, it also generated enormous economic growth and large revenues.

    Through the strategic use of torture, slave owners managed to generate production increases the world has hardly seen before. Whipping, sexual assault, electroshock, branding and waterboarding were all techniques used to make slaves pick more and faster.

    In 1860 cotton production was 130 times higher than in 1800. Around 1850, the United States had 3.2 million slaves with a market value of $ 1.3 billion, equivalent to one-fifth of the United States ‘wealth, about as much as the United States’ then GDP.

    The slaves served as solid security for the large banks in the Northern States who invested willingly in the profitable cotton production. At the outbreak of the Civil War in 1860, all the richest people in the United States were plantation owners.

    • Marx and Engels approached the question of early modern USA capitalist slavery quite differently to present moralists. For them it was not a moral category but an economic category ‘like any other’. They saw it as a massively positive thing in terms of historical economic progress. It allowed for the development of modern industry and world trade. The development of modern commerce and civilisation would not have been possible without it.

      Only further global economic development, for which USA slavery had provided the basis, allowed for its abolition, once the north industrialised to export and there was global competition in the cotton trade. Similarly, we now see feudalism as morally a ‘downer’ but it allowed for the emergence of early capitalism. It is the economic development in one period and way of doing things that allows for the transition to the next period and way.

      I am not an economic historian, so I cannot vouch for that reading of the historical economic import of USA slavery. They were there and that is how they read it at the time. Certainly the BLM tendency to approach USA slavery as primarily a moral category is not the approach of Marx and Engels. It seems doubtful that their analysis is orthodox ‘Marxist’.

      > …. Slavery is an economic category like any other. Thus it also has its two sides. Let us leave alone the bad side and talk about the good side of slavery. Needless to say, we are dealing only with direct slavery, with Negro slavery in Surinam, in Brazil, in the Southern States of North America.

      Direct slavery is just as much the pivot of bourgeois industry as machinery, credits, etc. Without slavery you have no cotton; without cotton you have no modern industry. It is slavery that gave the colonies their value; it is the colonies that created world trade, and it is world trade that is the precondition of large-scale industry. Thus slavery is an economic category of the greatest importance.

      Without slavery North America, the most progressive of countries, would be transformed into a patriarchal country. Wipe North America off the map of the world, and you will have anarchy – the complete decay of modern commerce and civilization. Cause slavery to disappear and you will have wiped America off the map of nations.[*1]

      Thus slavery, because it is an economic category, has always existed among the institutions of the peoples. Modern nations have been able only to disguise slavery in their own countries [wage labour], but they have imposed it without disguise upon the New World.

      *1. This was perfectly correct for the year 1847. At that time the world trade of the United States was limited mainly to import of immigrants and industrial products, and export of cotton and tobacco, i.e., of the products of southern slave labour. The Northern States produced mainly corn and meat for the slave states. It was only when the North produced corn and meat for export and also became an industrial country, and when the American cotton monopoly had to face powerful competition, in India, Egypt, Brazil, etc., that the abolition of slavery became possible. And even then this led to the ruin of the South, which did not succeed in replacing the open Negro slavery by the disguised slavery of Indian and Chinese coolies. [Note by Frederick Engels, to the 1885 German Edition.]

      – Marx, The Poverty of Philosophy

      https://www.marxists.org/archive/marx/works/1847/poverty-philosophy/ch02.htm

      • all nations with econo/commercial infrastructures used slaves until machines were developed to take over their labour

        we might think of slavery as people being owned and worked to death

        well—that is the way all ‘energy producers’ have been used

        farmworkers and miners were prime energy producers, the serf came as part of the landholding itself in the middle ages, and were not free to move away

        later the serfs were freed, but were paid so little as to make it slmost impossible to move away, and could be arrested for vagrancy if they were found elsewhere.

        miners too were paid barely enough to survive.

        they were slaves in all but name, to support a society that treated them with disdain as an underclass

        The british empire was made possibe by these ‘primary energy’ producers.

        Without them it could not have existed

        • Yes, I totally agree, thanks for that. BLM seem to lack any knowledge of economic history – and maybe just common sense too.

    • Marx and Engels explained their theory more generally elsewhere. It is economic development, that occurs gradually through history, that allows for the replacement of one way of doing things with another, and for the abolition of feudalism and slavery. Moral-economic categories, as part of the historical material-ideological structure, are secondary and they reflect the stage of development of the economic base – and as we might now say, the complexity of the dissipate structure.

      Feudal serfdom and ‘duty’ used to be seen as a ‘good thing’ because they allowed the society to function according to its level of economic development – just as wage labour is seen as the moral-economic ‘good’ today. One day wage labour, the necessary selling of time and labour to the propertied, would be seen as an ‘evil’, once it is no longer necessary to the functioning of the economy. Likely we will now never reach that stage of economic development, due to energy constraints, but the point remains theoretically correct if counterfactual.

      So, again it seems doubtful that the whole ‘moral’ emphasis of BLM in their critique of early modern USA slavery has got much to do with orthodox Marxism. If they base their analysis on the assumption of timeless moral-economic categories then they are either utopian or plain bourgeois. Really, what sort of ‘Marxists’ take the bourgeois property relations implied in wage labour as the basis for a moral critique of past economic categories? Feudalism was not waged labour either.

      Why not apply that same moralistic logic to feudalism and call for the removal of the statues of the old kings and queens? Why stop at slavery and imperialism (another historically progressive economic category that allowed for massive global economic development) when the entirety of economic history is just as morally ‘problematic’? It is a completely unrealistic approach to the past, frankly rather childish. If anything, BLM is simply reinforcing post-imperialist, globalist capitalist ideology and doing the capitalist state a massive.

      > Preconditions of the Real Liberation of Man

      …. Nor will we explain to them that it is only possible to achieve real liberation in the real world and by employing real means, that slavery cannot be abolished without the steam-engine and the mule and spinning-jenny, serfdom cannot be abolished without improved agriculture, and that, in general, people cannot be liberated as long as they are unable to obtain food and drink, housing and clothing in adequate quality and quantity. “Liberation” is an historical and not a mental act, and it is brought about by historical conditions, the development of industry, commerce, agriculture, the conditions of intercourse.

      – Marx and Engels, The German Ideology

      https://www.marxists.org/archive/marx/works/1845/german-ideology/ch01b.htm

      • Marx must of had a time machine.
        His analysis of capitalism (the difference between user and exchange value taken by someone doing none of the work) was uncanny.
        A new political system?
        Light, and a little optimistic.

        • However, all contemporary “communist” regimes have never even made it to the “dictator of the proletariat” stage.
          Hierarchical organizations all seem to have a elite control–
          That is why horizontal organizations are needed.

      • But how relevant are M+E to processing our current predicament? To what extent did they perceive surplus energy (in addition to labor) as an important input to industrial economies? Their focus on “development” doesn’t seem much different in conceit from the techno-optimists with their UBI, etc.

        The “abolition of feudalism and slavery” seems like quite a modern thing, indeed, and can hardly be teased away from the increasing fossil-fuel bonanza of that time leading into our own.

        I also sort of wonder at what the M+E idea of “liberation” would look like, since I am much happier to be poor with my own thoughts than to be taking a salary listening to and promulgating Critical Race Theory all day. (I admit it’s a bourgeois privilege to contemplate a putative choice between slavery of the body and slavery of the mind.)

        Oh dear, I don’t think I am at your level of sophistication in these analyses, but wonder whether you might comment in a more simplified fashion.

        M+E represented a certain [well-off, Jewish, intellectual] demographic seeking an outcome that may not be at all consonant with the wellbeing of the average person, and in fact modern Marxists seem to have extreme contempt for the average person. The handful of declared Marxists I have met are all professors with exorbitant salaries and pensions. They don’t seem interested in the actual state of the proletariat and, generally speaking, tend to stay as far away from such deplorables as is humanly possible, perhaps passing them on the highway while on the way to their summer homes.

        My perception is that the idea of leading some kind of “vanguard” of workers to break away from their chains is about as authentic as Jimmy Swaggart’s call to the faithful to renounce sin. Without workers in chains somewhere, who would fund TIAA-CREF, I ask you?!

        • Before fossil fuels, it is my understanding that road paving was often done by slaves. The work was too heavy for most people to voluntarily do the work.

          In New Testament times, there wasn’t a separate word for slave and servant in Greek. Pretty much everyone in a servant role was a slave.

        • Lidia, thanks for the reply, you are witty.

          Briefly:

          How relevant is Marxist analysis today? Well slavery is the past, so I do not see why a Marxist analysis would not help people today to understand the past.

          Also, we are still in capitalism and Marxism helps us to understand what is going on in the present with capitalist states and their fixation on BAU and GDP growth.

          As for the future, some concepts will still be relevant, like base and superstructure – what use people make of them will be up to them. It will retain its value as a theoretical historical materialist interpretative tool. I personally would still find it useful to understand what is going on after collapse and to orientate to it.

          Yes, fossil fuels became usable due to technology developed during the capitalist stage of economic development, and in turn they allowed for further technological development during the capitalist period. The two historically go together.

          I doubt that M n E would be the least interested in ‘critical race theory’ and they might well have dismissed it as bourgeois rubbish. You are subject to the stuff in a capitalist society, not a socialist, let us be honest about that. No socialist society ever developed that stuff.

          I hope this reply is ‘simple’, what can I say on that point?

          M n E were active participants in international working class movements during the 1st International Working Men’s Association along with many other socialists. They were not merely book worms but active members of working class resistance to capitalism. Again, the professors that you speak of are products of capitalist societies. Engels was not Jewish btw. and Marx was obviously secular.

          The ‘vanguard’ is a Leninist concept. M n E argued in the Communist Manifesto that communists should not have their own party but work with other labour parties. They saw working class liberation as the work of the working class itself.

          Thanks again for your reply, it is always a pleasure.

          • Even if slavery seems to be in the past, it may come back when there are clearly not enough resources to go around. Food, in particular, will be lacking. If a rich person will tell a poor person without a job, come, move onto my farm and work for me. I won’t be able to pay you wages, but I will give you food, clothing and a place to stay. I will expect you to work for what you get.

            Of course, the poor person will have no real ability to move elsewhere. He/she will have a hard time objecting to bad working conditions. The choice of spouses will likely be severely limited. Transportation and cell phones won’t be part of any deal. It will be just, “work from dawn to dusk” pretty much every day.

            • Yes, basically it is ‘base and superstructure’. The property relations and work arrangements, and the location of the social power, depend on the material economic situation at the time and place. Those basic ‘laws’ of history will still apply after collapse. Some of Marxism is just common sense now. It might still have seemed necessary to ‘demystify’ social relations in their historical, material locatedness, in mid-19th c. semi-feudal German society, but it hardly seems necessary today. We are all ‘Marxists’ now in that sense.

              As you say, an historical material perspective suggests to us what to expect after collapse. If energy consumption plummets, much complex technology disappears, and people are left with limited productive means, like farmland and less advanced tools, then people are going to enter into whatever property relations and working arrangements, and social power relations, that they can. And it may be slavery in all but name – because that is what then works and allows society to function according to its economic conditions.

              Slavery would not then be ‘immoral’, it would just be reality, as it was in the past, as historically, materially located according to the prevailing economic conditions. If anything it would be ‘good’ because it would allow society to function, and people to survive, if not to prosper. It would be conducive to life and to the expression of its drives, organic function (lol) and energy dissipation, and therefore ‘good’ as it was before, as feudalism was before and as capitalism is now. That is why the BLM sort of moral critique of past economic forms is so naïve, and it certainly has nothing to do with Marxism.

              It all depends on how deep collapse is. We may be able to maintain some of the social relations that we have become accustomed to, like wage labour, some pretence of democracy, if the productive means remain available to allow society to function on that basis. And if that is possible that then would be ‘good’ and even ‘better’ according to the prevailing material conditions. It all remains to be seen what happens. But at least an historical, material perspective allows us to understand what the preconditions are, and to adapt without illusions as new scenarios present themselves.

            • In my country, in rural regions, even in 1950 it was not uncommon for people to work just for the food. Nobody called it slavery, and formally it wasn’t, since the worker was free to refuse these conditions and try to find something better. But for many there was no alternative, and between quasi-slavery and hunger, the choice was obvious…

            • I understand that in Russia, after the collapse, the cafeterias in many businesses kept serving food. Workers came to work, even if they weren’t getting paid, apart from the free lunches. The subway was still running. And they had their gardens for food. I am sure there was other food as well.

        • Marx was mentally ill and a fantasist: in a letter to Engel’s he wrote, excitedly, that he dreamed of starting a Revolution and then being ‘crushed and swallowed up’ by it. Pretty sick stuff! To envisage oneself as a human sacrifice in this way is far from noble.

          Ironic, of course, that his Revolution when it came did swallow up and lead to the pitiless murder of millions.

          If one treats his economic theories seriously without looking at his perverted psychology and day-dreaming, one fails to comprehend what kind of man he was.

          And you’re spot on, Lydia, in identifying his other weaknesses, too: a creature of his times, no more.

          The only good to be said for him, possibly, is that the grave threat of Marxist revolution in the West post-WW2 led to humane social reforms.

          My family are -except for the raving Ultra-Catholics – all champagne (or more accurately, cava) Marxists such a joke to see their posturing from mansions and tenured university posts, without any contact with the real workers.

    • There is a quote from an English navy bosun around 1750, ‘in terms of work output, one enlisted sailor is worth four slaves’.

      • The Duchess of Devonshire informed her brother, who was in charge of the Navy c 1800, that the recruits who were supplied by the parish councils or seized and made to join -‘Join the Navy or else’ – were very poor stuff compared to willing volunteers, and they also caused lots of trouble once aboard.

        This partly explains the failure of collectivist, coercive, systems in which individual effort and choice are discounted.

        And yet Collectivism is being talked up now -in contrast to ‘wicked and egoistic’ Capitalism – as if the 20th century and its truly disastrous social and economic experiments had never happened.

      • An observation that was abundantly confirmed by the battle of Lepanto, where a smaller fleet manned by Christian knights and volunteers defeated a larger fleet manned largely by slaves. And, by the way, the anniversary of this battle, one of the decisive battles of the world, is coming up on 7 October. Domino Gloria!

    • Electroshock torture in 1860? Somebody has been smoking too much leftwing propaganda. And since a slave was probably the most valuable thing a cotton farmer could own, why would he severely degrade its value by torture? Of course, he didn’t: the (black) slaves were ordered around by (black) overseers while the owner drank mint juleps. karl Marx wrote an analysis of US chattel slavery that is much closer to the truth, besides being almost contemporary.

    • Marx was correct that slavery is/was an institution of all people’s.
      Your claim and the books claim that slaves generated 1/5 of the nations GDP in 1860..Is a bit stretched in my opinion. Other GDP estimates of the US at that time are above $30B. In this case cotton was a smaller portion of that and the value of slaves not even close to 1/5 th.

      But back then the many millions of farmers and their families, that were largely self sufficient, and their labors did not get included in GDP numbers since they mostly consumed what they produced. One also must include that most transactions in small towns, many of which were barter and many untaxed, were inevitably not included in GDP estimates. The enormous amount of ‘off the books’ labor of these farmers were also not included.

      One would have to intentionally misrepresent that slaves were generating 1/5th of GDP and everybody else was sitting around doing nothing. To the contrary, the millions of non-slave holders were laboring and generating wealth by establishing homes and industries.

      My great great grandfather was one of them, farming and ranching, working his proverbial rear end off, without slaves, and also fighting for Texas in the Confederacy, as a cavalryman. He fought for his state, and not for slavery. But to the point…he created wealth without slavery, just like to majority of people did. His products probably did not get equal billing as GDP since they did not export from a port and easily get recorded.

      It is true that cotton exports were a huge portion of the total US exports by 1860. Of course the problem then, as now, was that oligarchies of the day controlled most of the slavery and the big money flow that resulted. Same problem as today….oligarchies.

      Slavery built fortunes for oligarchs, and undoubtedly tax revenue for the state, as well as wealth for the government officials that were bribed by the slave owning oligarchs of the day. The banks that funded the slave owning oligarchs of the day also profited.

      But to the point of your assertion and that of the book, what makes sense that slavery generated cotton was a huge portion of the nations exports, but it cannot be said that hence, slavery built Americas wealth. A portion, of course, but I have to also value the labor and industriousness of all the non slave owners. There were far more of them than slave owners. The vast majority of the nations wealth was built without slavery.

      • I was hoping that someone else, besides the author of the book would have a perspective on this. A book will sell better if its makes very bold assertions, some of which are not quite true.

        The people outside the slave-owning area at least at one point did fairly well. But land fertility went down, as soil was overused, without fertilizer/crop rotation. I expect that this was a problem especially in the South, where cotton and tobacco were grown. Also, population grew, partly from continued immigration and partly from better hygiene. The result was falling food output per person. Army recruits became shorter before the US Civil War, indicating food supply problems, especially among poorer people.

        The situation was one of overshoot and collapse (or decline). The value of the slaves had been very high at one time, but suddenly was a whole lot lower as the economy was less able to afford their output.

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